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JULY 2009 T h e O n l i n e E x e c u t i v e N e w s f o r C o r p o r a t e L e a d e r s p10 Executive Newswire C B R E C B R i c h a r d E l l i s , G l o b a l R e s e a r c h & C o n s u l t i n g 2 0 0 9 E d i t i o n , E x e c u t i v e S u m m a r y How Global is the Business in Retail: CB Richard Ellis’s survey of 280 retailers across 67 countries examines the footprint of these retailers at national and city levels, highlighting differences between sectors and regions and identifying trends in global retail expansion. Which country attracts the most international retailers? Key findings: Almost half of all retailers in the survey (46%) had some presence in each of the three main global regions. However, the globalization of retail is still at a relatively early stage. The United Kingdom remains the country which attracts the most international retails, with 58% of non-UK retailers in the survey present in the country. In general, Europe is the most international retail market. All five of the largest European economies are ranked within the top eight international retailer destinations. Luxury retailers and those from the clothing/footwear sectors are significantly more international than retailers from other sectors. Luxury retailers are typically present in over 27 countries, compared with an average of just over 14 countries for the other retailers in the sample. Which emerging markets are the new retail hot spots? The emerging markets have been a major focus of new retail activity, the rankings of the most “international” retail markets have changed from last year, with a number of markets making significant moves up the global hierarchy: notable amongst these were Saudi Arabia (from 31st to 15th), Kuwait (from 30th to 19th), Canada (from 18th to 13th) and China (from 10th to 6th). The pattern of new openings is due to a combination of factors which have attracted retailers to the emerging markets. A common strategic driver has been increasing consumer affluence (linked to rising commodity prices and/or inward investment). Finding Which dominant city attracts 60% of all international retailers? Will global expansion remain a key strategic aim for retailers? London is the dominant retail city, attracting almost 60% of all retailers in the survey. Paris and New York rank second and third respectively, with Dubai in forth place. This is largely due to their attractiveness to the luxury and clothing/footwear sectors. Retailers from all sectors continued to expand their global footprint during 2008 despite a rapid weakening in business sentiment and increased risk aversion in response to the global economic downturn. Retailers in the survey were on average present in 16.5 international countries at the end of 2008 compared to 14.7 countries in late 2007 – an average increase of 1.8 countries per retailer, or 12%. Retailers have continued not just to internationalize, but to globalize. Over 40% of all new openings during 2008 were outside the home region of the retailer concerned. suitable real estate is also a common barrier to entry. The opening of a major new shopping center is therefore often the trigger for international retailers to open their first store in the country. In thinking about likely future globalization of retail activity, it is crucial to distinguish between short-term cyclical patterns and longer-term strategic trends. The strategic imperative to expand their international footprint and develop their brand at regional and global levels will remain a key theme for many retailers. For some retailers, the current environment may offer unprecedented opportunities to seize market share, through There were some variations between different types of retailers domiciled in different parts of the world. Growth was primarily driven by luxury and clothing/footwear retailers from Europe (mainly, Italy, France, UK and Spain) and, to a lesser extent, the US. On average, luxury retailers opened in 3.4 new countries in 2008, whilst clothing/ footwear retailers entered 1.9 new markets. Geographically, the primary beneficiaries of this global expansion process were the emerging markets, with Middle Eastern, Asian and Easter European countries dominating the list of new openings. The presence of significant franchising opportunities, particularly in Asia and the Middle East, has helped some retailers establish a presence in these markets at a reduced cost, and with lower risk than would have been possible by establishing a directly managed outlet. organic growth or acquisition of weaker competitors. Well capitalize private retailers may have greater short-term flexibility n their activities than their publicly listed counterparts who face greater scrutiny of their actions. Tactically, retail expansion needs to be viewed in the context of a very difficult trading environment. Many retailers are likely to delay their international expansion plans, at least temporarily, until the economic and financial outlook is less uncertain p1
p1 Top20 S T A N T O N C H A S E I N T E R N A T I O N A L Top 20 Most International Retail Cities Rank City % of International Retailers Present 1 London 60% 2 Paris 50% 3 New York 47% 4 Dubai 46% 5 Madrid 44% 6 Moscow 42% 7 Berlin 40% 8 Munich 40% 9 Barcelona 39% 10 Tokyo 39% 11 Singapore 38% 12 Hamburg 38% 13 Hong Kong 38% 14 Milan 38% 15 Beijing 36% 16 Istanbul 36% 17 Manchester 36% 18 Vienna 36% 19 Rome 36% 20 Chicago 35% Top 20 Most International Retail Countries Rank Country % of International Retailers Present Rank 2007 2008 2009 1 United Kingdom 58% 55% 1 2 Spain 48% 47% 2 3 France 46% 43% 4 4 U.A.E. 45% 39% 6 5 Germany 45% 44% 3 6 China 42% 37% 10 7 Russia 41% 38% 9 8 Italy 41% 40% 5 9 Switzerland 40% 38% 8 10 United States 39% 39% 7 11 Belgium 38% 34% 12 12 Austria 38% 36% 11 13 Canada 37% 31% 18 14 Japan 37% 33% 13 15 Saudi Arabia 37% 24% 31 16 Singapore 36% 33% 14 17 Turkey 36% 30% 23 18 Hong Kong 34% 31% 19 19 Kuwait 34% 25% 30 20 Ireland 34% 31% 20 20 Poland 34% 32% 16 20 Portugal 34% 31% 20 Dubai Updates Facts & figures (Q1 -2009) ISSUE 2 p11 Banking *positive results –ONLY ↓4% profits & ↑2% assets *ENBD ↑5% profits ↓ interest rates (EIBOR) Dubai International Airport *traffic passengers ↑2% (April ↑6.5%) *expected growth for 2009 is 10% Tourism (source: DTCM) *↑5% in hotel guests *occupancy 73% vs. 86% *Capacity ↑17% hotel rooms & ↑30% apartments *UK tourists 195k from 210k ↓7% Electricity & Water *Demand: Elec↑13% -water ↑7% Population for 2009 (Source: MOE) *UAE ↑6% -5.1m *Dubai ↑8% -1.7m Education(source: KHDA) *registered students 46k vs 45k (Indian schools in Dubai↑2%) Dubai is the top FDI destination city in the world by FT report Real estate & Construction sectors - concerns
Page 1 and 2: JULY 2009 The Online Executive News
Page 3 and 4: By Wassin Karkabi S T A N T O N C H
Page 5 and 6: By Nicolas Dietz Saudi Arabia, the
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Page 9: p1 By Juan D. Morales The logistics

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