Two of the largest mobile retailers in Russia and as many wireless carriers have stopped buying Samsung smartphone because of growing concerns about defective units and disagreements over repair guarantees, these carriers and retailers operate over 11,000 stores combined in the country so their decision to not buy Samsung’s products is certainly going to eat into the company’s bottom line in that country.
Retailers Euroset Holding NV and Svyaznoy have made this decision to stop purchasing smartphones from Samsung alongside carriers VimpelCom Ltd. and PJSC MegaFon. VimpelCom decided to stop its purchases after faulty units among Samsung devices reportedly reached as high as 7% which was more than other brands. Svyaznoy stopped ordering smartphones and tablets from Samsung in June and it’s currently selling whatever stock is left, the retailer estimates that following this move Samsung’s sales in Russia may have dropped by up to 25% over the past month. In an email to Bloomberg the company said that it “remains committed to providing the best possible products for Russian consumers,” but declined to comment on its relationship with Russian retailers.
Research group IDC estimates that Samsung sold smartphones worth close to $1.46 billion in Russia last year which accounted for 23% of unit sales in the entire country. With major retailers stepping back and carriers no longer ordering units before issues related to defective units and repair costs are settled, it appears that Samsung’s market share in Russia might be up for grabs if the company doesn’t get this matter sorted out soon.