Not Quite Business as Usual

For many of the traveling ilk, one of the first thoughts before a big trip is consideration for the spunky souvenirs you might bring home to wow family and friends. But have you wondered how shop owners and street sellers have fared over the past two years?

In St. Petersburg, souvenir hawkers have managed to scrape by. They are welcoming a slow increase in foreign tourists but have had little problem wooing Russian customers.

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Down the street behind St. Petersburg’s Church of the Savior on Blood, I was gently accosted at a souvenir stand. I was too careless, too cold, and weighed down from a day of walking to request the salesman’s name, but he asked for mine. He had been to the United States twice, and seemed to want to practice his thrumming, somewhat British-English, despite my attempt to keep it to Russian. Once he visited New York, and once Houston, Texas: “Two different countries,” he said.

How he lit up when he spoke! He had gotten caught up in a conversation in a bar in Houston with a farmer who loved his tractor. Four hours, the souvenir-man told me, four hours he sat and listened to the American talk about everything you could ever wonder about a tractor… until finally, the merchant said, enough! Let’s change the subject. Even a Russian in America can get bored.

I walked away without purchasing anything, though the man was still happy to show me the dual-toned cashmere scarf, one side a forest green, the other cream, without “trying to sell [me] anything.”

Folks like this make me wonder who in Russia really misses us, the foreigners; the Americans, the Westerners, the tourists?

If what I learned from three other souvenir sellers is true, then no one seems to be all that sore over our absence.

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Ilya, tall enough to stand above the strolling pedestrians and with a round boyish face, stood to the left of a little table displaying his handmade bronze castings. When asked for an interview, he explained in his deep voice that he prefers not to be photographed or recorded. Why not? I asked. Why did I choose my hat? My purse? he replied. The last time he has had his picture taken was in 2016 when he was 20 and had to get his passport.

Switching to excellent English, Ilya explained that he has been selling his bronze figures – winged lions, tigers, superheroes, anthropomorphic cat couples sitting on benches beneath lamps, all manners of other realistic and fantastical figures – for many years, but the pandemic forced him to close out his small store. Now, he is in the streets.

Who are his customers? Mostly Russians, Ilya said, but that was always the case when he was selling outside of his shop. Foreigners don’t tend to trust street-sellers, he believes, because they read bad reviews online about scams and higher prices for non-locals.

Work in the street can be tough, but Ilya had felt there was no other choice. In effect, his shop was left without the pandemic support that kept other enterprises afloat. President Vladimir Putin had called for measures to provide all small and medium enterprises with rent forgiveness, but the bureaucracy was such a hindrance, Ilya said, and you had to gather so many documents that it made it almost impossible for many businesses. He did not have the time to jump through the necessary hoops.

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Online Russian journal RBС (RosBiznesConsulting) reported in February 2021 that many businesses found it difficult or impossible to get support in the first year of the pandemic.

“Government support in the pandemic during 2020 was mainly aimed at businesses from the official list of affected industries, and most companies could not count on them. About a quarter of the businesses surveyed did not try to get state support during the crisis, and almost a third of businessmen (31.8%) were unable to take advantage of any support measures, despite the fact that they tried to do so.”

Measures included loans, tax and credit deferrals, and debt restructuring to counter declining revenue. Besides weak demand, “the top three business problems also included the inability to pay property tax and pay rent, as well as the lack of funds to pay salaries to employees and insurance premiums from the payroll.”

How did they adapt?

Some clever artists did what any shrewd salesperson would and kept up with the latest trend to increase sales.  In the city of Semyonov during the spring of 2020, artist and woodworker Tamara Koreva began adding masks to her matryoshkas, or Russian nesting dolls, as well as other images inspired by the coronavirus.

But as with Ilya, many other businesses closed their doors, although this trend was prominent in different groups of business. According to the online publication Expert South, Russian small businesses actually saw greater closure in 2019, before the pandemic hit – for comparison, in 2019 the Southern Federal District of Russia lost 8.4 percent of small businesses whereas in 2020 the total decreased by 2.6 percent. In fact, the number of medium-sized businesses in varying Russian regions actually increased in 2020.

Most business closures in the Southern Federal District during the pandemic were microenterprises, generally in the agriculture, construction, manufacturing, and trade industries. Of these microenterprises, approximately 70 percent are individual entrepreneurs, much like Ilya and others in the souvenir trade.

An October 2020 article from Izvestiya reported that “net closings… amounted to 247 thousand firms” from August 2019 to August 2020; an April 2021 article from Vedomosti said that, in 2020, the number of small businesses declined by 220,000 due to the pandemic. The number of Russian small businesses at the time, announced during the April 2021 Krasnoyarsk Economic Forum, was 5,780,000.

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Despite the initial struggle, some business sectors in Russia are nearly back to normal.

In an interview with Expert South, Anton Butenko, regional manager of Alfa-Bank in Rostov-on-Don explained that their medium-sized business clients were hardly affected by the pandemic, and small business was the fastest to recover from the initial hit.

For some, souvenir sales also seem to be doing well at the beginning of 2022.

Funnyman Vasily, stationed next to the ticket booth at St. Isaac’s Cathedral with his hood pulled over his winter cap, spoke to me like he was letting me in on a secret. He almost always replied to my questions with his hand cupped to the right side of his mouth. Though his face was weathered, Vasily’s smile curled up like a cat’s; most of his answers were curt, as though his words found it hard to pass lips that pulled somewhat inward.

Plucky, bouncy, leaning in and back out while talking to me, he told me he’d been working the souvenir gig for almost 30 years.  His wares ranged from coins minted with presumably helpful Russian expressions – “Don’t drink” or “Definitely drink,” for example – to the obligatory keychains, bottle openers, magnets, and mugs stamped with the handsome face of Sergei Bodrov Junior, of the iconic film “Brother.”

Before the pandemic, Vasiliy said, business was excellent. “There were people, a squall, a whole ocean. Not one, but two oceans.” Once the pandemic hit, of course, there were nearly no foreigners and fewer Russians buying his goods. Sales ceased.

Tourists returned slowly after the first lockdown. Now, as with Ilya, most of Vasily’s customers are Russian. Many come from Moscow.

Crowds today are back to normal. Vasily pointed to the ticket booth to our left: “Look at how many people! Lots of people. Super.” He loves the work, because he likes people, likes to chat with people – and what he likes best, of course, is “when people buy.”

Though I did not buy, Vasily, grinning, wished me “a pleasant day” in English as I walked away.

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Shifts in tourism patterns brought some of the most significant challenges to Russia’s economy – and many economies globally – at the beginning of the pandemic.

In 2020, Russia’s resort sector closed for two and a half months and only gradually reopened. In Crimea, for example, tourism decreased by about 15 percent during the year, and foreign tourism is down to a trickle.

However, the effect of the continued closure of international borders was partially offset by an increase of domestic tourism to recreational spaces as well as natural and cultural attractions.

As reported in a May 2021 Vedomosti article, while the first half of the year was terrible for domestic tourism and overall the percentages decreased from 35-40 percent compared to 2019, the sales director of Moscow’s 5-star Moss hotel claimed that they have seen a 30 percent increase in domestic tourists since 2019 due to a special cashback program to stimulate bookings in Russian hotels.

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I encountered Daniel with his folding table set up in the Alexander Garden across from St. Isaac’s Cathedral, his regular haunt. He has been at this work for almost fifteen years.

The salesman is in his forties and communicated with an open vibrancy. Somewhat grungy, with a long, ginger beard speckled with white – longer than what you’ll usually see on Russian men today – Daniel had pulled a somewhat threadbare hoodie up over his winter hat.

At the beginning of the pandemic, “purchasing power fell,” Daniel said, and his income just about halved. Still, he is not quite making what he used to.

Who buys his wares? “My compatriots.” Daniel laughed. “Russians.” There are still few foreigners.

He partners with two artists, a bronze maker and a ceramicist who creates funky magnets, and Daniel finds the more cliché tourist fare – keychains, znachki, other items – on his own. He calls this “speculation”: hunting for and reselling mass-produced souvenirs and other cheap trinkets. 

There is a negative connotation to the term “speculation” enduring from the Soviet period.
“In society, people don’t welcome it. No one will say it directly, but implicitly, people in Russia respect people who do something by hand more. Engineers, builders, etcetera.”

But a person who heads out into the street to sell something? In the Soviet Union, the merchant would be called a “torgash,” loosely translated as “huckster.” The word has a “rude… black color.”

This is changing today. For people in their twenties and thirties, the negative connotation is at least not fully conscious, although people might still pick up on it in the media.

Still, the “speculation” doesn’t bother him. “I bought it for five rubles in one place, sold it for fifteen in another place – there’s no creative effort, no mental component.” Daniel says he has more of an “American worldview,” and this type of work is normal for him.

“Americans are raised on this from childhood, right? Go there, put out lemonade by your home, sell it. It’s normal. Oh! What a cool dude, he’s over there making money.”

So does Daniel like to sell? “Probably not. I like to communicate, to chat. I’m chatting with you now – I get pleasure out of it. That is, I exchange energy with you, it’s a process. I influence something, I change something.” Rather than some rote exchange where he sells, goes home, eats dinner, sleeps, goes to the toilet – “simply human functions” – our conversation becomes an experience for both of us, and we are somewhat “changing the system.”

Like any good “speculator” should, Daniel managed to hustle – and certainly influenced my day. I walked off with two znachki and a magnet reading “All tasty goodies go to the thighs.”

Maybe, just maybe, Daniel will miss me.