Annual Report 2004 - HL Display

the region attractive to the multinational chains, and most are
now active in this area. It has also meant that the Western chains
are now dominant in the region. Foreign investments were initially
targeted towards Poland, Hungary and the Czech Republic, which
has led to these markets now starting to become saturated, with
a higher degree of owner concentration. As in Western Europe, the
popularity of the low-price chains is also increasing rapidly.
The countries where retail concentration is lower are now at the
top of the agenda for the multinational chains. Slovenia, Turkey,
Rumania and Russia are examples of countries where the retail
sector is expanding rapidly.
Revolutionary developments in Asia
The Asian retail sector has undergone a revolutionary development
in a short period of time – from traditional markets to modern
hypermarkets and supermarkets. Western influences, economic
developments, better education and an improved standard of living
have caused changes to consumers’ tastes and needs. The
retail sector nowadays is not just about price, consumers also
place great emphasis on the in-store environment, hygiene and a
broad product range.
Major differences between countries
Even though modern retail has made its presence felt in the Asian
region as a whole, there are major differences between countries.
Singapore, Hong Kong, Japan, South Korea and Taiwan have a wellestablished
retail sector, and developments are proceeding apace
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in China, Indonesia, Malaysia and Thailand. At the same time there
are countries in the region where the retail sector is still undeveloped,
such as Laos and Vietnam.
The countries where market concentration has made most
progress are Hong Kong, Malaysia, South Korea and Thailand.
However, concentration is low by Western European standards,
with the five biggest retail chains in these countries having a total
market share of less than 40 per cent.
High retail growth in China
For many years the large western chains have been expanding rapidly
in Asia. In many cases the multinational companies have used
the hypermarket format to establish themselves in the market.
But it is not only western chains that are expanding, there are also
several regional players that are expanding their market shares,
such as Ito-Yokado and Dairy Farm Group. The growth potential
continues to be considerable, and the large multinationals are
maintaining a rapid rate of expansion especially in China, Indonesia,
Malaysia and Thailand.
Not unexpectedly, growth during the year has been highest in
China, where the number of stores has increased by around 40
per cent. The retail market in China has been valued at around
USD 240 billion, and has been dominated by local players such as
Beijing Wangfujing Group and Wumart Stores. Multinational chains
such as Carrefour, Wal-Mart, Tesco and Metro are increasing their
investments, with Carrefour, for example, already having around 50
hypermarkets in the country.
MARKNAD
HL DISPLAY ANNUAL REPORT 2004