In recent weeks, Russia’s Wildberries has been in the news. Though little known in the West, Wildberries is the country’s largest e-commerce platform, with many likening it to Amazon.
However, Wildberries is in the news for no reason a company wants to be: In recent weeks its warehouses have been heavily targeted by Ukraine in the ongoing conflict between the two countries. Here’s what you need to know about Wildberries and why its logistics facilities are being targeted.
What is Wildberries?
Wildberries is Russia’s leading e-commerce provider. The company was founded in 2004 by Tatyana Kim when she was just 28. Kim is Russia’s richest woman, with an estimated net worth of around $8.1 billion, according to Forbes.
Much like Amazon, Wildberries operates on a hybrid model, selling goods directly to customers while also serving as a marketplace for third-party sellers who can open storefronts and list items for sale, which are then fulfilled by Wildberries.
In addition to its logistics warehouse and fulfillment centers, Wildberries operates tens of thousands of pickup points across Russia, where customers can collect their orders.
The company’s online store sells many of the typical wares you might find on Amazon, including clothing, beauty products, tools, and electronics. The company also offers digital wallet, banking, and travel services.
Why is Wildberries in the news now?
Not for any reason the company is happy about. Since at least July, Wildberries’ warehouses and similar facilities inside Russia have been continuously targeted by Ukraine amidst its ongoing conflict with Russia.
As reported by the New York Times, since mid-July, Ukrainian forces have so far struck at least 23 Wildberries facilities. The strikes usually involve drones delivering explosives, and they have so far resulted in at least nine Wildberries workers being killed.
The NYT cites the Moscow-based Data Insight e-commerce consultancy as stating that the attack on Wildberries facilities has resulted in the destruction of about $5.9 billion worth of goods contained in the warehouses hit.
The strikes have also reduced Wildberries’ warehouse space by about a third.
Not all of the items being destroyed inside the warehouses are owned by Wildberries. The company stores items for its many third-party sellers, who have also reported the destruction of some of their inventory, according to the Times.
Why is Ukraine targeting Wildberries’ facilities?
According to the Times, Ukraine’s stated rationale for targeting Wildberries facilities is that the Russian e-commerce giant sells military-related goods on its website, including spare parts for drones. The Russian military uses drones in its airstrikes against Ukraine.
Wildberries has said that it bars the sale of weapons and armaments on its platform.
Regardless of the rationale, the attacks could also provide Ukraine with another advantage in its fight against Russia. The bombing of Wildberries’ facilities has disrupted not just the company but also its customers.
The Times notes that Wildberries accounts for about 10% of all of Russia’s retail sales.
If its customers face ongoing problems in getting the goods they order, it could result in psychological discontent and an increase in Russians who are sick of seeing their lives disrupted by the war.
This discontent could put political pressure on Russian President Vladimir Putin to look for an exit strategy from the hostilities. Of course, whether that scenario plays out remains to be seen.
But perhaps what the Wildberries attacks signal most is that in the 21st century, private companies are no longer immune to being directly—militarily—targeted by a country’s enemies.
Indeed, earlier this year, Iran struck multiple Amazon-owned data centers in the United Arab Emirates. As the Conversation noted at the time, the facilities housed Amazon Web Services (AWS). The Amazon data center attacks are believed to have been carried out by Iran because the country believed Amazon’s compute was being used to support U.S. military operations in the region.