Tucked away down a heavily graffitied concrete passage behind a sportswear shop in central Belgrade, Choomich Belgrade Design District has housed the shops and ateliers of young Serbian designers since 2010. But with consumer spending low and growing competition from international high street brands, the BDD's future is uncertain.
Back in the 1990s, Choomich was the first high-end mall in Belgrade, stocking brands most people could only dream about buying. Two decades later, the mall was "practically dead", according to Tijana Pavlov, one of a group of young Serbian designers who approached the owners and asked for a deal on rent.
Belgrade's designers are a close-knit community, influenced by Serbia's years in political isolation. "Our country was almost hermetically sealed, we developed unique fashions, something a bit underground," says Pavlov. She and fellow designer Aleksandra Ziravac say the BDD is important for providing affordable retail space and the chance for consumer feedback. "We're not designing for Lady Gaga, but for ordinary people," Ziravac says.
Unfortunately, since every shop in the mall has a different owner, the designers have never been able to renovate, or even replace the cracked, stained floor tiles. According to Pavlov, Belgrade city council has been unhelpful, never promoting the district or putting up signposts. And now the leases are due to expire in November 2012, casting doubt over the district's future. "We have a long way to go to keep the BDD alive," says designer Ana Ljubinkovic. "At a time when the Serbian national gallery and the Museum of Modern Arts were closed, we created an art district. We know we did something great, but BDD is not as popular as brand new shopping malls because we don't have money for big advertising, and that is sad."
With few customers in sight, many of the designers spend their days smoking and drinking coffee together. Others have an air of desperation as they offer to make alterations or run up a dress in a different fabric if none of their stock appeals. The pool of clients is small, mainly limited to Belgrade's artistic and media elite. As a result, many BDD designers are in a dire financial situation. "I am famous in Serbia but I don't earn enough to eat," Pavlov sighs.
To an extent, this reflects the situation in the Serbian retail sector as a whole. According to the Statistical Office of the Republic of Serbia, the sector declined steadily throughout 2011, with sales volume dropping 18.3% in September alone. A Cushman & Wakefield report describes market conditions as "challenging" and warns "a recovery in consumer sentiment is unlikely in 2012."
Recent years have seen some international brands enter the market, though Serbia lags behind other Emerging European countries because of low spending power, lack of modern retail space and continuing perceptions of political instability. "Per-capita shopping centre provision is very low by European standards, although provision across Serbia should increase in the next few years," says the C&W report. Zara was one of the first entrants to the Serbian market. Delta Sport, the Zara distributor for Serbia and Montenegro, opened the first store in 2006, and others have followed. They provide stiff competition for local designers, and with the economy expected to remain sluggish - the IMF forecasts 0.5% growth 2012 - there is not a lot of spending power to go around.
One businessman has, however, managed to find a way to support local designers and writers while also turning a profit. Already the owner of several successful restaurants, Slavko Markovic in November 2008 launched Concept Supermarket, a shop, restaurant and event space on StrahinjiÄa Bana Street - dubbed "silicone valley" thanks to the many surgically enhanced fashionistas frequenting its outdoor cafes. "We launched just after the crisis started. It seemed like the worst period for starting something new, but Supermarket happened to suit the new age we were entering," he tells bne. "The crisis inspired a different way of thinking, that was less about money and more about life, the environment and other people."
Markovic wanted to support new ideas and designers, selling local fashions alongside international brands. He believes that domestic products have gradually become more acceptable to consumers. "Previously, locally-made was a symbol for expensive and bad. We are slowly starting to see domestic products competing with goods from abroad."
Running a restaurant in addition to the shop - all housed in a former food supermarket - provided an alternate source of revenue. Even so, Markovic had to continue putting more money in to keep Supermarket afloat. Now, however, it has started to turn a profit, albeit a small one.
Given the small size and relative poverty of the Serbian market, the next step will be expansion abroad. A small version of Supermarket is going to open at Porto Montenegro, the largest marina on the Mediterranean currently being built in neighbouring Montenegro by a group of billionaires including Canadian gold miner Peter Munk and Oleg Deripaska. "After that, we want to open in Berlin and then spread to other major cities with a community of people who live for their art," Markovic says.