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The Accenture Globalization Index results show a growing appeal for small-format stores and international expansion among emerging market retailers.
The index analyzes Planet Retail’s data of nearly 500 of the largest global retailers and examines their entry into new markets. Based on the data gathered for three successive periods, Accenture has identified a number of retail trends.
An expansion into the emerging markets of Asia by retailers in the middle of 2012 was tempered by holiday sales and the need for multichannel reorganization at the end of 2012.
In this report, Accenture sheds light on two trends:
New market entries appear to be focused on small formats, e-commerce sites and temporary stores.
Emerging market retailers are starting to make international moves.
In a challenging economic climate and with more sophisticated and demanding shoppers, globalization is fast becoming a vital component of any retailer’s long-term success strategy.
Planet Retail offered its global retail intelligence to facilitate Accenture’s analysis of market entries and their impact on the global retail strategy.
The retailer universe identified by Accenture and Planet Retail encompassed the top retailers by grocery and nonfood sales—a total of 489 retailers. New market entries grew to 25 in the third period (January 16, 2013–April 15, 2013) from 17 in the second period (October 16, 2012–January 15, 2013).
According to the index, retailers are rethinking investments in big estates of large stores in new markets, especially if they have excessive space in their home market.
Instead, they are entering new markets with small-format and temporary stores—pop-ups—to gauge consumer interest and the potential success of a permanent store presence.
Globally, the retail landscape continues to evolve at a rapid pace amid social, economic and technological changes, which are influencing retailers’ investment decisions.
Accenture believes that international expansion by many emerging market-based retailers suggests both a growing confidence among those retailers and potentially, the early warning signs of saturation in some emerging markets.
Read the full results of each quarterly report: Accenture Globalization Index: July 2013 [PDF, 1.18 MB]Accenture Globalization Index: May 2013Accenture Globalization Index: February 2013Accenture Globalization Index: November 2012
Emerging market retailers made up 20 percent of all market entries in this third period, compared with 0 percent in the second period and 12 percent in the first period.
Over the three periods, seven of the nine entries by emerging market-based retailers were into other emerging markets.
Accenture believes that this trend will grow strongly as two primary drivers for international expansion fall into place:
Growing saturation in the home market and emerging markets becoming more competitive.
Having the capital and talent resources for investment in researching and entering new markets. (Many emerging market retailers are reaching this state.)
July 10, 2013
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