THE battle for the minds and wallets of consumers has resumed, after more than a two-year hiatus brought on by the Great Recession- With retail sales rising again, development opportunities are surfacing fast, though not uniformly, for retail property developers, managers and retailers, with the most promising seen in developing economies-According to the 2010 Global Retail Development Index (GRDI) by global management consultant firm AT Kearney, while recession-bruised developed economies may take a while to climb out of the deep hole they are in, markets in Asia, Latin America and the Middle East appear increasingly well-poised for spectacular growth-The annual study, already into its ninth year, selected 30 emerging countries from a list of 185 and ranked them based on 25 macroeconomic and retail-specific variables, with the aim of comparing their prospects for retail expansion-Drawing from the findings revealed in the firm's past studies, it found "windows of opportunities"-BRIC remain top targets for expansionIn the world's top three economies - China, India and Russia - AT Kearney said that even though their markets were supposed to have peaked in 2006 and matured in 2010, competition for market share is still fierce, with consumers unrelenting in their demand and real estate values continuing to escalate-China took top spot in the 2010 GRDI (the last time it ranked so high was in 2002), due to the country's huge population, rapid pace of urbanisation and expanding middleclass segment- In terms of retail formats, AT Kearney found that the Chinese still prefer the hypermarket, but said that it could be displaced by high-end retail centres as demand for luxury products makes China the world's largest luxury market by 2015-The 2009 GRDI winner, India, fell to third place (after Kuwait) because of limited and desirable real estate, foreign investment restrictions and an increasingly crowded market caused by an influx of foreign players-However, AT Kearney said these setbacks are not likely to hold back investors and that it is confident India's retail segment will continue growing rapidly because of its fast growing middle-class who are also demanding higher quality shopping environments and stronger brands-Although Russia, which occupied second position in the 2009 GRDI, fell to 10th last year, it managed to remain at the forefront of Eastern Europe, thanks to its large consumer market, rising disposal incomes and an expanding middleclass-Driving the development of the country's most popular retail format, the big-box store, are foreign retailers in the form of Metro Group and Auchan (which operates 40 hypermarkets)-Together with Brazil, these countries, collectively known as the BRIC nations, take the highest priority for retail expansion for most of the 60 global retail companies interviewed by AT Kearney for its 2010 survey- Close to 80 per cent of them said one of these markets were part of their expansion plans internationally for the immediate term, due to their tremendous growth opportunities in organised retail-Besides the BRIC nations, smaller heavily urbanised countries with wealthy populations are also on the radar of these retailers, and include Kuwait, Uruguay, Albania and Macedonia-High expectationsInterestingly, the retailers seeking expansion are not just from developed nations but also developing ones too-Malaysia's Parkson Corporation, for instance, has expanded into Vietnam, Chile's Falabella chain has entered the Peruvian and Columbian markets and China's AS Watson is operating over 1,000 stores in Europe-Notwithstanding the fact that competition today is much stiffer than before and consumers are a more demanding lot, many retailers are expecting to reap profits within the first three years of operations in a new market, which stands in stark contrast to the five to seven years expected of new-market entry as revealed in AT Kearney's 2005 study-Granted there will be no shortage of consumers going by the demographics and economic growth outlook of emerging markets, and luxury buying has rebounded-But out of the economic collapse also came what consumer analysts called the new normal or the great reset- After being hammered by the Great Recession, consumers are changing their shopping habits - a trend that will shift the global retail competitive landscape-Global retail players will have to be prepared for these unprecedented conditions in a whole new retail battlefield-Lim Lay Ying is managing director of Research Inc- (Asia), a company specialising in market research and consultancy for all facets of real estate development-...

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