These Franchises Have Stopped Doing Business in Russia
As the country's invasion of Ukraine wears on, more and more major franchises are halting operations inside the Eastern European power.
With some exceptions, most major U.S.- and European-based businesses have cut ties with Russia since it invaded neighboring Ukraine on February 24. For publicly traded corporations like Apple, it's a shrewd maneuver, regardless of ethical calculations. But whatever the motivation, cutting off access to familiar technology, retail and other creature comforts and necessities has fomented considerable agitation among Russia's residents, not all of whom support President Vladimir Putin's unprovoked attack on Ukraine's sovereignty. And those who oppose the war hope that unrest becomes one more means of pressuring Putin toward compromise.
Along with tech giants and big-name manufacturers, notable franchises have followed suit and indefinitely ceased operations inside Russia. And as the brutal assaults on innocent Ukrainians persist and outrage from global consumers swells, more will likely be added to the list.
Here is a brief roll call of select, high-profile franchises that have closed their doors or otherwise halted commerce in Russia over the past several weeks, along with links to their public statements. We will update the list if/when additional high-profile companies make similar announcements.
On March 8, the Golden Arches formally announced temporary closure of all locations in Russia. Although this has demonstrably anguished customers, CEO Chris Kempczinski assured the public that, "We understand the impact this will have on our Russian colleagues and partners, which is why we are prepared to support all three legs of the stool in Ukraine and Russia. This includes salary continuation for all McDonald's employees in Russia."
Meanwhile, Russia has an apparent plan B. A trademark was recently filed for an alternative fast-food hub dubbed Uncle Vanya's. Does the logo look familiar?
This one comes with a caveat. Burger King's parent company, Restaurant Brands International (RBI), announced on March 7 that, "Burger King has suspended all of its corporate support for the Russian market, including operations, marketing and supply chain in addition to refusing approvals for investment and expansion." But because all BK locations in Russia are run by a "local master franchisee," RBI does not have the authority to close those restaurants. It has, however, committed to "redirecting any profits from franchised operations to humanitarian aid for Ukrainian refugees" and working to distribute vouchers for free Whopper meals to Ukrainian refugees across Europe.
On March 4, the Seattle-based coffee behemoth fully paused both retail operations and importation of products to Russia. In a statement, then-CEO Kevin Johnson (Johnson separately announced his imminent retirement this week) said, "Through this dynamic situation, we will continue to make decisions that are true to our mission and values and communicate with transparency." (Franchising a Starbucks location is not an option in the U.S. or Canada, but is overseas.)
Like McDonald's, Starbucks pledges to financially support the "nearly 2,000 partners in Russia who depend on Starbucks for their livelihood" amid its temporary break in business.
After getting heat for purchasing a large shipment of Russian crude oil early in the invasion of Ukraine, Shell issued a public apology, stating, "We are acutely aware that our decision ... was not the right one and we are sorry." The company has since avowed to stop buying Russian crude amid the conflict and shut all service stations across the country, among other measures. Said CEO Ben van Beurden, "These societal challenges highlight the dilemma between putting pressure on the Russian government over its atrocities in Ukraine and ensuring stable, secure energy supplies across Europe."
The Colorado-based casual-footwear giant shared on March 9 that it "made a decision to pause its direct-to-consumer business, inclusive of ecommerce and retail operations in Russia," along with temporarily ceasing importation of its products. Crocs will continue compensating both corporate and retail staff in Russia and has touted its charitable contributions to UNICEF to support those impacted by the war.
The Swedish-founded home-goods chain was quick to cut ties, releasing an announcement on March 3 that read, in part, "The war has had a huge human impact already. It is also resulting in serious disruptions to supply chain and trading conditions. For all of these reasons, the company groups have decided to temporarily pause IKEA operations in Russia." (Ceasing of imports and exports extends to Belarus as well.)
Like the other franchises on this list, IKEA intends to acknowledge the everyday Russian employees this will affect in the immediate, adding, "These decisions have a direct impact on 15,000 IKEA co-workers. The ambitions of the company groups are long term and we have secured employment and income stability for the immediate future and provide support to them and their families in the region."
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