retail asia 2013 analysis & top 40

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Retail Asia's Top 40 Retailers in Asia Pacific Ranking Top 500 retailers in the region generated sales topping US$1 trillion in 2012. Euromonitor International’s latest retailing research places retail sales for Asia Pacific (including Australa- sia) at US$4 trillion in 2012. The Top 500 retailers alone accounted for nearly 24% of total retail sales in the region. Copyright 2013 Euromonitor International.

TRANSCRIPT

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    2013 retail asia-pacific top 500o v e r v i e w

    Internet retailing emerges as a rising star in Asia-Pacific

    In the 10th edition of the Retail Asia-Pacific Top 500, we review key numbers unveiled by markets and formats across the Top 14 economies in the region. Internet retailing takes the spotlight this

    year, and for the first time, we are pleased to share the ranking of the Top 10 Internet retailers in the Asia-Pacific region. We also hear from Euromoni-tor Internationals team of analysts, led by Geok Leng Loo, head of research, who will bring you up to speed with the latest in Internet retail developments in their respective markets.

    Market highlights by numbers

    Top 500 retailers in the region generated sales topping US$1 trillion in 2012. Euromonitor Internationals latest retailing research places retail sales for Asia Pacific (including Australa-sia) at US$4 trillion in 2012. The Top 500 retailers alone accounted for nearly 24% of total retail sales in the region.

    Sales value of the regions Top 500 retailers grew by 5.4% in current value terms in 2012. Growth was muted as the greenback weakened considerably against a number of local cur-rencies such as the Japanese yen.

    Having ousted Japan from pole position in the last edition, China emerged once again as the country having the most number of entries in the Top 500 rankings in 2012, taking 147 of the 500 positions available.

    Retailers in Japan in the Top 500 rankings accounted for the lions share of value sales gener-ated, even though this share is being chipped away by the rising presence of Chinese retailers in the rankings over the years.

    The representation of China in the Top 500 rankings saw the biggest increase of nine entries amongst the 14 Asia-Pacific markets.

    Indias presence in the rankings was the hardest hit by the ascent of the retailers in China. Retailers in India ceded six entries in this edition of the Top 500.

    Value sales generated by Indonesian retailers in the Top 500 rankings saw an increase of 19% in 2012. Domestic economy growth remained positive in 2012, with lower unemployment rates and relatedly, rising disposable incomes. Against this positive backdrop, retailers in the country generally benefited.

    Vietnamese retailers in the Top 500 rankings witnessed a 11% decline in sales, due to a cutback in spending as a result of the faltering domestic economy.

    US$1,053 billion

    +5.4% current terms

    147 entries

    47% value share

    +9 entries

    -6 entries

    +19% current terms

    -11% current terms

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    Having overtaken department stores previously, hardline remained the key format among the Top 500 retailers in this edition. Hardline retailers took 84 of the 500 entries this year. The significance of hardline retailers in the Top 500 can be attributed to Asia-Pacific consumers being house-proud and their embracement of electronic gadgets and appliances.

    As before, department stores continued to account for the majority of the Top 500 retailers value sales. This is despite the format seeing its representation in the rankings being whittled away gradually over the years.

    Clothing, footwear and accessories retailers saw an increase in representation in the Top 500 rankings this year. The yen for specialised shops offering specific brands not commonly found elsewhere, continued and rising aspirational lifestyles which fuel the expansion of luxury clothing, footwear and accessories retailers as well as the provision of personalised services are but some of the factors working in the favour of clothing, footwear and acces-sories retailers in the region.

    Format highlights by numbers

    Ranking Retail Company 1 Alibaba Group Holding Ltd 2 Rakuten Inc 3 Amazon.com Inc 4 360buy.com 5 eBay Inc 6 Apple Inc 7 Dell Inc 8 Suning Appliance Co Ltd 9 Yahoo! Inc

    10 Lotte Group

    84 entries

    +20% value share

    +3 entries

    In the jostling for a slice of the rankings, convenience stores witnessed a loss of four entries to the other formats.

    -4 entries

    Clocking the lowest growth are retailers in the sports goods format. Many other formats such as department stores and even hypermarkets also retail sports apparel and related products. Not to mention, there remain consumers who do not see the need to be fully kitted out to engage in sports.

    Hypermarkets sales per sqm remained the lowest relative to the other formats covered in the Top 500 rankings.

    Hypermarkets saw the biggest increase in value sales in 2012. The channels value-for-money positioning, on top of strong expansion and wide range of both grocery and non-grocery products on offer, served to benefit hypermarkets in this regard.

    +10.9% current terms

    +2.4% current terms

    US$2,650 per sqm

    Who leads Internet retailing in Asia-PacificInternet retailing is a channel that has gained tremendous interest from retail-

    ers and consumers alike. For the 10th edition of the Retail Asia-Pacific Top 500 rankings, other than shining the spotlight on the Top 500 retailers in the region, the Top 10 retailers by format and the Top 10 retailers by country, we also focus on the leading Internet retailers in the region.

    Euromonitor International defines Internet re-tailing as the sale of consumer goods to the general public via the Internet. Consumers purchase goods online through the Web platform. Sales data is at-tributed to the country where the consumer is based, rather than where the retailer is based. Sales gener-ated by businesses with consumers through online shopping centres, malls and marketplaces, such as eBay, are included in Internet retailing. Therefore, sales figures should include sales over auction sites

    Top 10 Internet Retailers in Asia-Pacific

    Note: Based on 2012 retail value sales ex VAT, US$, current prices

    Convenience stores continued to come up tops in terms of the format generating the highest sales per sqm.

    US$1,053 per sqm

    that are generated between a business and a con-sumer; however, no business-to-business (B2B) sales or consumer-to-consumer (C2C) sales are included.

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    Chinese players take three spotsChinese companies came up thrice amongst the Top 10 Internet retailers in the region. The leading Internet retailer in the Asia-Pacific region was Alibaba Group Holding Ltd. Running Tmall.com, it is the largest Internet retailer in China, as well as the region. Tmall.com will continue its business-to-consumer (B2C) platform strategy, to provide a one-stop shopping experience for online consumers through enriched product and brand portfolios.

    The online platform will strengthen its coopera-tion with small and medium-sized sellers to increase diversification, assisted by enhanced microblogging marketing and shopping search engines, and so on, in order to provide a smooth shopping experience for consumers.

    Owing to its growing consumer base and a wide range of consumer products at competitive prices, Taobao.com has enjoyed strong growth in Internet

    retailing in China. Boasting over 82 million active online members in the first half of 2012, Tmall.com has far outperformed its major rivals in In-ternet retailing in China. Aggressive marketing activities, including the Shopping Spree Festival held annu-

    ally on November 11 since 2009, as well as massive price discounts, have attracted consumers and kept them active users of Tmall.com in the review period.

    360buy.com, also an Internet retailer operating in China, took fourth position last year. The company is the second-ranked Internet retailer in China. Diversity is an important development strategy for 360buy.com. In addition to being the leading online shopping mall focusing on consumer electronics products in China, 360buy.com continued to explore other lucrative market categories in the review period, with the successful launch of a series of sub-brand Internet retail platforms, including ehaoyao.com, 360Top.com and minitiao.com in late 2011, focusing on medicines and healthcare products, luxuries, as well as Japan- and Korea-originated commodities, respectively. The latest addition is en.360buy.com, launched in October last year, an English-language online shopping mall, targeting overseas, particularly western, markets.

    Suning Appliance Co Ltd is the other Chinese player who took the eighth spot in the ranking of the Top 10 Internet retailers in Asia-Pacific. The company is one of the leading hardline retailers in the country. To gain a foothold in Internet retailing in China, the company launched the online B2C platform www.suning.com, offering mainly consumer appliances and electronics to Chinese consumers. Extensive product lines, convenient online payment, advanced logistics, an extensive distribution network supported by its existing outlets across the country, and good after-sales service enabled Suning to record strong growth in its Internet business over the period of 2011-12.

    Suning.com is expected to continue its low price strategy for its online channel, including no annual service fee for suppliers of the online channel. To extend its online business, the company acquired

    Redbaby.com.cn in mid-2012, a local Internet re-tailer specialised in online retailing of mother and baby products.

    Vast product offerings win players a place in the Top 10It is noteworthy that the top five Internet retailers are all specialising in more than one particular product type. Rather, these players provi