Global retailers slowdown expansion plans – Accenture

Retailers were less focused on expansion into Brazil, Russia, and India in the first quarter. In fact, Brazil and Russia recorded just one new retail market entry each and India had no recorded retailer market entries. Market entries into Brazil did increase slightly, however, with three market entries recorded in the second quarter.

“The timing of entry into a new market is crucial; too early and the market is not ready, too late and the competition is entrenched,” said Donnelly. “These findings suggest that retailers are already eyeing the next big thing for international growth. Previously, Brazil, Russia and India were a greater focus for retailers seeking to expand into new markets. The experiences of the early retail entrants shed light on the challenges they faced and provided the next wave of entrants with more information about the risks and rewards.”

Among the other highlights of the study:

- The most popular modes of market entry globally in the first quarter were organic growth – 17 of 43 market entries – followed by website launches with 13 market entries.

- During the second quarter, franchise expansion was the leading mode of market entry, with eight entries recorded. However, organic growth and website launches accounted for the vast majority of the other market entries during this period.

- Apparel retailers recorded 15 market entries in the first quarter of monitoring and also led the market entries in the second quarter, representing five of the 17 entries recorded.

- Of the entries recorded between July and October, 13 were conducted through physical store openings and two through website launches.

- The first-quarter entries spanned 12 countries in both mature and emerging markets: China, Colombia, Dominican Republic, Hong Kong, Japan, Latvia, Malaysia, Mexico, South Africa, Thailand, the United Kingdom and the United States.

- Grocery retailers made 12 market entries during the first quarter of monitoring, but accounted for only four of the 17 market entries during the second quarter. The first-quarter entries were noteworthy since the three ecommerce expansions by three of the largest global grocers were all made in emerging markets.

Accenture