Vovk debuted in Poland in 2023 with high hopes, opening its first showroom in Warsaw's Blue City shopping center.
Read also: Poland will sign SAFE agreements with the European Commission. Magdalena Sobkowiak reveals details
Investment worth approx 300 thousand euro it was supposed to be just the beginning of expansion. However, reality turned out to be brutal for the brand, which manages an impressive network of 56 stores in Ukraine.
Location trap and late internet
The company's management, analyzing the reasons for the failure, beats its chest. One of the main sins was choosing the place of debut. Blue City did not attract a target group on a scale that would ensure profitability. Moreover, the brand fell into the trap of too narrow targeting.
The company based its strategy too strongly on customers of Ukrainian nationality living in Poland, instead of fighting for the Polish consumer more broadly. – admit representatives of the network.
The situation was made worse by the fact that in the era of digitalization of trade, Vovk ignored the potential of online sales. The online store was launched only a year after the opening of the stationary branch, which is an almost unforgivable mistake in the fashion industry and significantly limited the building of brand recognition among Polish women.
Read also: Maximum fuel prices for Tuesday. This is what drivers will pay
An expensive lesson in European business
The chain's authorities do not hide their surprise at the differences in the realities of running a business. What worked in Ukraine became a logistical and financial burden on the Vistula River. The main challenges included drastically higher rents in shopping malls and labor costs.
The shopping habits of Polish customers also turned out to be an unexpected problem. As the company points out, it has become a major financial burden a specific approach to returns of goods – the trend of frequently returning purchases, which is standard in Poland, turned out to be too expensive for the Ukrainian business model.
Shopping patriotism is an impenetrable barrier
Vovk also had to face the strong position of local and global players. The Polish clothing market is saturated, and consumers are very attached to domestic products or proven giants.
“Polish consumers' strong attachment to domestic products and the established position of clothing giants such as Zara, H&M and Reserved have created a barrier that is difficult to break.” – say the company's authorities.
What's next for the Ukrainian network?
Despite the defeat in Poland Vovk's position in Ukraine remains stable – the company still employs approximately 650 people there. Currently, the brand is changing its business model, focusing on production services as a subcontractor for other entities.
However, leaving the Polish market will be extremely costly for the company. It is estimated that the penalties for early termination of the lease in Warsaw alone may exceed the original investment costs, which makes the Polish adventure of the Vovk brand one of the most expensive lessons in the company's history.
