Reaching the consumers

Marketing opportunities

Consumer behavior

The price factor has most value for the Ukrainian consumer. In addition, he is greatly attracted by western products, which he can see are of higher quality than national products, and he is very enthusiastic about them since he knows that these products are often difficult to obtain in the hinterland. The quality of after-sales service is a criterion which can set a foreign company apart, for in Ukraine shops very rarely exchange defective goods, and for this reason consumers have a very poor image of this aspect of sales in the country.

Consumer profile and purchasing power

A household's average income is estimated at 450 EUR, and 90% of the average Ukrainian's budget is devoted to primary expenses (food and housing). The middle class, in the western sense of the term, represents about 9% of the population, and its number is growing at the same time as the country's economy; it is strongly attracted by western products. A large proportion of the popular classes also identifies with the middle class, since a third of the population feels it belongs to this group. Most Ukrainian consumers belong to the 35-49 age bracket, and to the 10-20 one. This latter category stands out for its greater consumption of western products, while the former contribute most to the real estate and ready-to-wear markets.

Consumers associations

Ukrainian consumer association

Main advertising agencies

Leo Burnett Ukraine
Saatchi & Saatchi Ukraine
EURO RSCG Ukraine
Sahar
Inart

Distributing a product

Market shares

Non-organized retail shops have 43% of the market, local shops control 25%, while supermarkets have approximately 12% market share.

Organizations in the retail sector

Association of Ukrainian Distributors

Market access procedures

International Conventions

Member of World Trade Organisation
Party to the Kyoto protocol

Non tariff barriers

The only important barrier to trade and investment in Ukraine is the country's difficulty in transiting from a planned economy to a market economy. Following economic reforms, the country experienced a relative success concerning export and investment but all this requires perspectives and a long-term strategy. There are real structural barriers putting a brake on trade and investment in Ukraine : corruption, lack of protection in terms of intellectual or industrial property, lack of foreign exchange, an ill defined or too bureaucratic hierarchy, an inefficient and little developed banking system, law, license and tariff changes... Investment is precisely curbed by the absence of private property and a coherent privatization programme, non convertibility of the country's currency and lack of financial liquidity, change of legislation relating to investment, lack of quality, lack of competitive prices for hiring or purchasing representative offices, poor infrastructures, political instability...

Customs duties and taxes on imports

1 litre of  ethyl alcohol: 23 UAH.

1 litre of Cognac: 14 UAH.

Cigarettes with filters: 60 UAH.

Customs classification

The import duties to be paid by a foreign importer in Ukraine vary according to the type of product: alcohol, tobacco, motor cars, tires, jewelry and other luxury products. The payment of these duties must be effected in the country's currency. Excise duties are also paid in the local currency and are calculated as follows: for non luxury products, a percentage is applied and for luxury products the excise duty is not calculated on the customs declared value but according to volume, number of units or weight of the import.

Import procedures

The import duties to be paid by a foreign importer in Ukraine vary according to the type of product: alcohol, tobacco, motor cars, tires, jewelry and other luxury products. The payment of these duties must be effected in the country's currency. Excise duties are also paid in the local currency and are calculated as follows: for non luxury products, a percentage is applied and for luxury products the excise duty is not calculated on the customs declared value but according to volume, number of units or weight of the import.

Organizing goods transport

Ports

The port of Odessa
The ports of Ukraine
The port of Illitchevsk
The port of Nikolaev
The port of Yuzhny (website in Russian)
Location of the main ports in Ukraine

Airports

Borispil international airport, Kiev
Donetsk international airport
Dniepropetrovsk international airport
Lviv international airport
Odessa international airport

Air transport organizations

National Civil Aviation Administration (website in Ukrainian)

Road transport organizations

National Road Department

Rail transport organizations

National Railway Administration

Identifying a supplier

Type of production

Metallurgy and metal processing represented 20% of the country's GDP in 2007. Growth in production reached +8.3% in 2007 (production of cast iron, steel and iron alloys, manufacturing of finished products, metal casting). Mechanical construction represented, in 2007, 12.9% of Ukraine's GDP. The growth of industrial production in 2007 reached +28.6% in comparison with 2006. This increase in volume is due firstly to the rise in production of automobiles (+60.6%), machines for the mining industry (+34.3%), and wagons for rail transport (+31.1%). The agrifood sector represents 17% of Ukraine's GDP. The growth of this sector is on average 20% per year. For companies involved in the food and agricultural product processing industries, in 2007 the volume of production increased by +10% in comparison with 2006. Ukraine has a very strong agricultural potential with lands which are among the most fertile in the world. The chemical and petrochemical industries represented 6.7% of the country's GDP in 2007. Ukraine is a big exporter especially of fertilizer (70 countries). The share of investment in the chemical and petrochemical sectors represents 15.8%. The volume of production in 2007 increased by +6.2% in comparison with 2006.

Business directories

Ukraine Yellow pages , Business contacts

Manufacturers associations of the main industries

Association of Ukrainian Motor Vehicle Manufacturers
Association of oil manufacturers of Ukraine

Trade Agencies and their representations abroad

Ukrainian Chamber of Commerce and Industry