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Germany, UK top destinations for world retail

By Simone Preuss

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Business

Germany and the UK are the most sought after retail destinations in the world, followed by France and China. This is what the sixth edition of Los Angeles-based real estate services company CBRE's annual report "How Active are Retailers Globally?" found.

According to the report, a solid network of brick-and-mortar stores is still key: "Given the ongoing challenges retailers face from cost escalation, e-commerce and changes in consumer behaviour, it is increasingly important for them to have a strong network of stores to effectively represent their brand."

The report examined once more the global expansion ambitions of more than 115 retailers, which were divided into three territories: the Americas; Europe, Middle East and Africa (EMEA), and Asia Pacific (APAC). Of those retailers surveyed, 40 percent said they would target Germany for expansion in 2015; 33 percent the UK; 31 percent France and 28 percent China.

Retail brands in Germany, UK, US and Italy most active

In terms of country of origin, retail brands in Germany, the UK, the US and Italy are the most active with the 16 percent of the former three looking to expand overseas in 2015 and 11 percent of Italian retailers. "Physical stores remain the destination of choice for consumers. Recognising this, retailers continue to open stores in diverse locations," states the report.

Thus, 50 percent of retailers based in Asia Pacific mentioned South Korea as their preferred expansion target while 47 percent of retailers based in Europe, the Middle East or Africa designated Germany as their top target market. Among the American retailers, 43 percent are planning to expand in Japan, China and Hong Kong in 2015.

By segement, Asia Pacific remains the preferred target territory of 85 percent of luxury and business fashion retailers and 67 percent of coffee and restaurant retailers, while 78 percent of mid-range fashion retailers are looking at Europe, the Middle East and Africa.

As their biggest concern, 47 percent of all retailers surveyed mentioned cost escalation and unclear economic prospects; of least concern were foreign direct investments (1 percent) and an insufficient logistics network (2 percent). By territory, American retailers worried most about a lack of quality retail space (57 percent) and unclear economic prospects (50 percent), while retailers in Asia Pacific mentioned cost escalation as their biggest concern (49 percent), followed by unclear economic prospects (42 percent), which was shared by 49 percent of retailers based in Europe, the Middle East or Africa. Their second biggest concern was cost escalation (46 percent).

Images: CBRE Research
CBRE
global retail survey