Rethinking growth strategies

January 29, 2020 | By RetailME Bureau

Economic development and trade policy remain the most significant factors in shaping retail growth in consumer markets, indicate research firm AT Kearney’s Global Retail Development Index (GRDI) 2019.

Taxation policies dictate discretionary consumer spend, impacting everything from cost-of-goods to the consumer to the cost of doing business in a country; and lead certain companies to operate or not operate in individual markets; and even determine the quality and quantity of goods for sale. In 2018, to diversify away from its dependence on oil revenues, Saudi Arabia adopted a value-added tax (VAT) of 5% across a broad range of goods, causing a decline in spending.

Geopolitical instability and growing power of local and regional competition in emerging markets are forcing global retailers to rethink their strategies continually. While social media and e-commerce fuel the evolution of global consumers, local realities such as internet connectivity and availability and cost of labour, continue to shape retail developments in the Middle East.

The Middle Eastern spotlights 

The bi-annual study of the global retailing landscape also revealed that the UAE remains a resilient retail environment with an overall growth rate of 3-4%. This year, retail in the UAE is seeing a new era of disruption, with e-commerce growth estimated at upwards of 20% per year.

A key theme in this year’s findings is also the ‘Arrival of the Middle East and Africa’ – 10 of the top 30 countries fall into this bucket, suggesting that emerging economies are maturing, and the next wave of retail development and growth will undoubtedly be in the broader region.

Economies in the region have made significant gains in the GRDI rankings. They have caught the attention of leading retailers driven by government-led economic reforms, a large and digitally connected youth consumer segment and growing purchasing power. In addition to local retailers investing in-country, many regional names – including Majid Al Futtaim, Landmark Group, Lulu Group – as well as international brands – such as Zara, IKEA – are investing in both brick-and-mortar and digital across these markets.

Among other significant findings from the MENA region included in GDRI:

  • Saudi Arabia:In the Kingdom of Saudi Arabia (KSA), the government’s comprehensive reforms are yielding positive results. The retail sector is all set to grow faster; as a result, contributing to over one million additional jobs and an increase of women labour force participation to 30%.
  • Egypt:The country, debuting in AT Kearney’s GRDI, has seen retail sector growth of 25% between 2017 and 2018 on the back of economic and fiscal reforms. Egypt is ‘open’ for business, as many regional and international retailers are aggressively entering the market and transforming the landscape from traditional to modern trade.
  • Jordan:The Jordanian retail sector is expected to grow between 4-and-5% as the country transforms into a modern trade environment. Catering for a price-sensitive consumer and navigating complex logistics can result in faster growth.
  • Ghana:It is Africa’s new ‘bright spot’ driven by increased foreign and public investment as well as urbanisation of the population. As a result, department stores/shopping store space are forecast to grow by 15% per year and many international retailers are taking notice.

To read the full article, subscribe to RetailME January edition



Previous Article Next Article


UAE-based grocery retail chain, Grandiose has opened its first hypermarket in Abu 

Continue Reading

June 2, 2021 | By RetailME Bureau

UAE-based Carrefour announced its theme and plans for Ramadan 2021. The brand 

Continue Reading

March 31, 2021 | By RetailME Bureau

Locally owned supermarket Spinneys celebrates 60 years of doing business in the 

Continue Reading

March 9, 2021 | By RetailME Bureau
Almarai, Carrefour, Emirates have the most loyal customers

UAE-based Carrefour will become the first retailer in the region to offer new levels 

Continue Reading

February 22, 2021 | By RetailME Bureau

The Organic Farmers’ Market is back in Bay Avenue for its 12th 

Continue Reading

February 17, 2021 | By RetailME Bureau

UAE-based  Lulu Group recently inaugurated its first-ever all-female staff store in Jeddah, 

Continue Reading

February 15, 2021 | By RetailME Bureau
Jones the grocer

Jones the Grocer, the gourmet grocer and cheese retailer launches the Jones 

Continue Reading

February 1, 2021 | By RetailME Bureau

UAE-based Al Maya Supermarkets is hosting a two-week food festival at select 

Continue Reading

January 17, 2021 | By Lawrence Pinto

Locally-owned supermarket Spinneys has launched its ‘Power of Plants’ initiative in the 

Continue Reading

January 17, 2021 | By RetailME Bureau

Carrefour UAE has launched “Cookit Yourself” — a curated recipe box created 

Continue Reading

January 5, 2021 | By RetailME Bureau
Al Islami Plant-Based Burger

UAE-based Al Islami Foods, one of the largest frozen food companies in 

Continue Reading

January 3, 2021 | By RetailME Bureau
Marks & Spencer's plant-based range

Marks & Spencer’s plant-based range now offers over 25 vegan products including meat-free 

Continue Reading

December 23, 2020 | By RetailME Bureau

Download Images RetailME Magazine