Retail markets of Phl, other Asian nations offer opportunities

MANILA, Philippines - The expanding retail markets of the Philippines and other Asian countries are hotter and bursting with opportunity.

Exporters can thus gear their marketing efforts towards expanding the local retail market and tapping other emerging countries for retail development, said Dennis Orlina, president of the Philippine Chamber of Handicraft Industries, Inc. (PCHI).

Orlina made this recommendation following the release of the 2011 Global Retail Development Index (GRDI) indicating that six Asian markets, including the Philippines, were among the top 30 destinations for global retailers.  

He said the data suggest that aside from the local market, exporters can set their sights on these countries as their alternative markets, in addition to their traditional buyers.

“Many developed markets have been slower to recover from the global economic downturn than emerging markets and are often over-stored and facing wary customers,” he said. “New markets offer new opportunities, as well as new challenges. Global expansion is more than knowing where to go; it is knowing when and how to do it.” 

Citing GRDI result released by international management consulting firm A.T. Kearney, Orlina said the Philippines has improved its position as top emerging markets for retail development.

He said the Filipinos’ purchasing power is supported by two contributing sectors to the rise of the “new” middle income class. These are the business processing outsourcing sector now employing an estimated 350,000 Filipinos and the remittances sent to their families here by the overseas Filipino workers.

“So we just have to shift our gears. If we cannot export and be competitive, why don’t we work on the emerging retail markets?”, Orlina said.

The GRDI found that the Philippine urban areas are fueling growth, with a rising number of dual-income, middle-class families and young professionals driving the retail sales. Half of the country’s total retail sales are concentrated in the Manila metropolitan area.

“The Philippines, 24th this year, is expected to see retail sales grow from $39 billion in 2011 to $42 billion by 2015, thanks to an expanding urban population and rising consumer spending that is fueling growth in organized retail,” the report noted.

Other Asian emerging countries ideal for retail development are India, China, Indonesia, Malaysia and Vietnam. Others are Middle East and North Africa (MENA) and South American countries.

“The outlook for Southeast Asia remains bright, with increased domestic demand and exports, stabilizing retail sales and improving consumer confidence. Grocery remains the region’s most important sector, accounting for almost two-thirds of total organized retail sales,” the report added.

Orlina said the Chamber has been using results of the GRDI report as a benchmark to study movements of buyers.