Chicago -- For the third consecutive year, Brazil ranked number one in the top 30 developing countries for retail investment worldwide by A.T. Kearney. Rounding out the top five are: Chile, Uruguay, China and the United Arab Emirates.
The 2013 A.T. Kearney Global Retail Development Index (GRDI) revealed that South and Latin America remain significant growth markets for retailers. Sub-Saharan Africa continues to build momentum, with Botswana and Namibia in the rankings and a few other nations ranked just outside the top 30. Africa is a dramatic retail opportunity if business and political risk can be managed, according to the survey.
A number of small countries with unique characteristics of wealth and consumer focus including Uruguay (3rd) Mongolia (7th), Georgia (8th), and Armenia (10th) are ranked in the GRDI. For luxury retailers, these are new-found hubs. For general retailers, these countries can be the beginning of a regional strategy.
“Shopping centers and malls are driving much of the progress in organized retail in developing countries, as they solve regulatory and real estate issues for many retailers, “ said Althea Peng, A.T. Kearney partner and study co-leader.
In other survey findings, India dropped nine places in the ranking, landing at number 14. The global slowdown did not spare India, whose GDP growth rate slipped to 5% to 6%, while same-store sales volume growth slowed in 2012 across all retail segments. High operating costs, low bargaining power with vendors, and a need to discount heavily to improve sales have put pressure on margins and, therefore, retailers’ expansion plans. Real estate cost and space availability have been important issues as well.
The top 10 countries
- United Arab Emirates
Published since 2002, the GRDI ranks the top 30 developing countries for retail investment worldwide. The Index analyzes 25 macroeconomic and retail-specific variables to help retailers devise successful global strategies and to identify emerging market investment opportunities.
To read the full 2012 GRDI Report, visit grdi.atkearney.com.