A recent report released by CBRE has determined that cross-border retail activity grew 3.1 per cent last year. The report, “How Global is the Business of Retail?” analyzes the operational networks of 334 leading international brands across 61 countries, accounting for a majority of the world’s economy.
To assess the degree to which these companies expanded their global operations, CBRE measured all the international retailers entering each of the markets it covered.
Interesting findings from the study include:
• Hong Kong was the hottest market in 2015, with 73 new brands opening there. Singapore is in second place with 63 new brands, followed by Tokyo (57), Taipei (47), Moscow (40), London (39), Dubai (38), Beijing (37), Bucharest (35) and Doha (29).
• Unlike in previous years the cities in the top rankings are all from different markets, with no two cities from the same country
• European retailers dominate cross-border retailer activity, and are increasingly global in their outlook. European brands accounted for 59% of new market entrants globally.
• Expansion into North America increased significantly in 2015, up from 3% to 13%. Strong upward trends in consumer indicators, such as employment and job growth prospects, may be attracting retailers who are looking at the longer-term growth prospects in this region.
Anthony Buono, executive managing director of retail services in the Americas, suggests that some brands may be focusing more on the global stage to compensate for slow sales in their home markets.
“Broadly speaking, there are only certain levers that retailers can use to grow their brands,” he said. “One way is expanding in the current country they’re in, but in the U.S. there’s more optimization. They can expand the brand in other channels.”
As these leading brands continue to expand into international markets, retailers will need to reconsider marketing and sales strategies in order to compete with their big name competitors. For more information, view the report here.
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