Where is the investor going?

International consulting company AT Kearney published its annual ranking of the most promising for investment in retail trade markets (The 2012 Global Retail Development Index, GRDI). The ranking includes 30 developing countries, and for the second year in a row, Brazil is becoming the most attractive for retailers. “Several factors speak in favor of this country as the main direction for retail chains: a growing economy on the shoulders of the middle class, high levels of consumption, a large urban population and a decreased political and financial risk,” AT Kearney reports.

In addition to Brazil, two more Latin American countries entered the top five in the ranking - Chile (second place, as in 2011) and Uruguay (fourth place, in 2011 - third). China was ranked third, ranking only sixth in 2011. The top 5 is rounded out by India, which was in fourth place last year.

The markets of the BRIC countries are still very important for the largest global networks, but at the same time there are many other undeveloped markets that provide new growth opportunities. Georgia (6 place), Oman (8), Mongolia (9) and Azerbaijan (17) have become much more attractive for global players, and especially for manufacturers of specialized and luxury goods. These markets, albeit small in terms of sales, have strong fundamental indicators in which retailers interested in concentrated wealth and striving to be the first in fast-growing markets are interested.

Russia took 26 place in the ranking of the most promising countries for investment in retail trade. In 2011, it was on the 14 line. However, this should not be regarded as a loss of attractiveness of the Russian market as a whole for foreign retailers, said Per Hong, one of the co-authors of the study, managing partner of the Moscow office of ATKearney.

“Russian retail trade has already recovered from the 2009 downturn, indicators have returned to pre-crisis levels, and growth continues. Growth prospects are quite favorable, and at the same time, when compiling this rating, we take into account not only the attractiveness of the market, but also country risk, market saturation and the possibility of delaying the entry of retailers. The difficulties of doing business in Russia are well known, there is a shortage of suitable real estate (and it is expensive), the market is highly fragmented. The rating indicates that the Russian market is definitely no longer a market for emerging opportunities, and GRDI is looking at just such markets. Rather, it is entering a phase where it will need to be compared with more developed countries in Europe, ”says Per Hong.

The revenue of leading Russian retailers such as the Х5 Retail Group, Okay and Magnit has been growing at the level of 30% or more in recent years, with the expansion of modern retail trade. If buyers in Western Europe tightened their belts during the crisis, this did not happen in Russia. The growth of incomes of the population played a role, as well as the fact that Russians save only a small part of their income and gravitate towards luxury and premium brands. This significantly increases the attractiveness of the market for international retailers seeking to compensate for the short-term decline in demand in developed countries.

Trends vary slightly depending on the channel. In 2011, Russia opened 100 new hypermarkets. Foreign retailers have long been present in the country and are aggressively expanding. Auchan and Metro today took the third and fourth place in Russia in terms of sales among food retailers, and are actively launching new formats in response to changing consumer demands. Auchan will open six hypermarkets in 2012 and expand its Atak supermarket chain from 50 to 200 to 2015. Metro plans to open 15 stores this year, and the group's Real chain has recently launched small-box stores.

“The retail industry in Russia is still highly fragmented - the five leaders occupy less than 15% of the market, which leads to persistent discussion of when and how to expect the emergence of foreign retailers that are still not present in Russia, such as Wal- mart. The question, in my opinion, is rather not whether they will come, but when it will happen, ”Per Hong said.

The Russian luxury market is booming after being squeezed during a recession. Most international luxury brands are already present in Russia, and many of them have refused intermediaries in the past five years and have chosen to act independently. Prada recently opened its first store in Moscow, and by the end of the year, new Ralph Lauren, Chanel and Cartier boutiques will also appear in the city.

Another important feature of the Russian market is a significant increase in e-commerce. Today in Russia, the volume of the online trading market has already exceeded $ 9 billion per year. It is reported by retailer.ru.