PHILIPPINE RETAILING
World News
In today’s hyperconnected world,
convenience is the ultimate
currency—Nielsen
Around the globe, consumers need and look for convenience in
all forms—whether simplicity, time saving or suitability to keep
pace with an accelerated lifestyle, according to Nielsen’s latest
report The Quest for Convenience.
When it comes to the fast-moving consumer goods (FMCG) space, convenience
is not only about store formats, products or packaging, the latest technologies
or new engagement strategies. Rather, it is about every encounter, interaction
and action that can help fulfil consumers’ growing demand for efficiency, the
report says.
Globally, Nielsen’s global retail growth strategies survey found that 46% of
consumers view shopping as a chore—given the consequences of coping with
busy lifestyles, commuting times and smaller living spaces.
As a result, consumers are replacing stock-up grocery shopping trips with
smaller, more frequent needs-based trips. In fact, the reports says that 10% of
shoppers claim they buy just for the meal they plan to have on that specific day.
Across all regions, smaller stores are posting higher growth than larger ones
with smaller stores now account for 25% of FMCG sales and 70% of shopping
trips.
Large format
retailers in
Asia to grow
3.3% annually
to 2022—IGD
“There is a lot of speculation
that FMCG development
will be exclusively in
the online space as the
demand for convenience
pulls consumers toward
e-commerce. Many view
the growth of non-physical
channels as bad news for
bricks and mortar formats,
but I see opportunities,”
said Peter Gale, Managing
Director, Nielsen Retailer
Services South East Asia.
“Convenience solutions can
greatly enhance physical
retailing—think
cashless
and automated payments,
grab-and-go products, and
click-and-collect. There will
always be demand for physical stores, although in the evolving retail landscape,
FMCG players will need omnichannel presence.”
Even in areas where online shopping has not been well adopted to date, such
as in fresh food shopping, the tides are shifting as projected by the Global
E-Commerce Study which found that 26% of consumers have bought fresh
(Nielsen, 8/7/2018)
groceries online, up 15% from 2016.
offering a good range at reasonable prices. Online retailers continue to invest
heavily to gain new customers. Besides expansion to new regions, retailers
are also digitizing physical stores to create a seamless shopping experience in
more matured markets. Large format retailers therefore need to balance their
investments in existing stores, as well as network expansion in order to stay
relevant to shoppers.
“Vietnam is dominated by traditional trade, but modern retail is picking up
pace,” according to IGD’s Head of Asia Pacific Nick Miles.
Asia’s large format retailers are set to grow 3.3% a year to 2022,
with Vietnam, India and Philippines forecast to see double-digit
growth from large format players over five years, according to
global research organization IGD.
Most of this growth is predicted to be driven by domestic retailers, except for
Vietnam where foreign retailers have been investing to gain a foothold in this
fast-growing market. Indonesia will have steady growth also driven mainly by
domestic players, with China coming through as another market with significant
growth opportunities due to its vast geography. Many large format retailers
in Asia are still enjoying steady growth through expansion although they are
facing pressures from increased competition in more developed markets.
More convenience stores are opening in close proximity to offices and homes,
He added that foreign retailers are investing in large malls and building
hypermarkets and supermarkets as anchors to draw shoppers, with focus on
big cities like Ho Chi Minh City, Hanoi, Danang and Can Tho.
For India, he said that the country’s modern grocery retail landscape is highly
fragmented. “New entrants to the market usually focus on building their
distribution within a tight geography to focus their investment and create
efficiency in the supply chain,” he added.
“There are great opportunities for modern retail growth in the Philippines.
Local retailers are well established, with large format stores maintaining strong
growth through network expansion. Retailers are adding stores in major urban
cities and new regions like the Visayas and Mindanao,” he commented on the
(IGD.com, 7/27/2018)
Philippines.
Asia-Pacific retailers
ramp up overseas
expansion
Asia-Pacific retailers as increasingly
embracing
overseas
expansion,
according to new research by
commercial real estate company
CBRE.
8
3RD QUARTER 2018
The report, Rise of Apac Retailers 2018,
analyzed 600 openings in the region,
showing the proportion of Apac retailers
(predominantly F&B operators, fashion and
beauty brands) had increased from 17 to 30
percent between 2014 and last year, accounting
for almost a third of new regional entrants. The strongest
target markets are China, Hong Kong, Taiwan and
Singapore, while the expansion itself has been shown to
strengthen brands in their home markets. Most retailers
expanding into Apac territories are from Australia, Japan
and Korea.
The firm’s head of retail, advisory and transaction services
Asia Vivek Kaul said, “Apac retailers are becoming a driving
force in the region, spurred on by potential revenue
growth and the need for stronger brand awareness. This
expansion is not focused on one single market – instead,
it reflects the diversity and dynamism within Asia Pacific’s
retail sector.”
Associate director of Asia Pacific research Liz Hung said
whether they are establishing flagship stores in gateway
cities or testing the waters in emerging markets, Apac
brands are “increasingly adopting a savvier approach” to
(Inside Retail Asia,09/18/2018)
regional expansion.