The United Arab Emirates was placed second on the 2013 Retail Apparel Index. The index is part of AT Kearney’s 2013 Global Retail Development report which was recently published. The country stands out with its impressive market attractiveness and overall retail development.
United Arab Emirates
According to the index, retails are interested in UAE’s market due to its big expat community, developed retail industry and the high number of tourists who visit the country. In addition, many of them choose to grow their retail business there because of the various incentives for business owners.
The report adds that many famous fashion brands have opened stores in the country over the last couple of years. Among them are, for example, Bloomingdale’s and Bulgari in Abu Dhabi and Prada, Gap and Calvin Klein in Dubai. Soon they will be joined by other brands like Yves Saint Laurent and Abercrombie & Fitch.
The Middle East
The list includes two other countries from the Middle East– Kuwait (4) and Saudi Arabia (6). The index points out that the region’s apparel sector still manages to attract a lot of consumers. The newest retailers on the local markets offer apparel on prices that can suit nearly anyone. Also, the Middle East is now seen as a fashion center thanks to the different fashion shows, events and brands that operate there. In addition, the report has found that many of the new foreign retailers prefer to team up with local brands because of the foreign direct investment requirements in the area.
China
The leader in the list is China. The country continues to hold the first spot mainly due to the massive growth in the sales of clothing. Also, the index identifies three main trends in China’s retail apparel sector. The first of them is the increase in e-commerce. While in the majority of emerging countries e-commerce is estimated at under 1%, in China is amounts to 6%. The second big trend in the Asian country’s retail apparel sphere is the boom in fast fashion. The boom was triggered by China’s middle class’ high demand for the newest apparel trends. Last but, not least, is the transformation of the luxury market in the country. Due to China’s large market, world-known luxury retail brands are attracted by the country. Ralph Lauren, for instance, will open about 60 stores in China by 2016.
Latin America
Similar to the Middle East region, Latin America has three representatives on the list – Chile (3), Brazil (5) and Mexico (9). The retail apparel expansions on the continent are just beginning. The global retail brands’ plans for Latin America are often more ambitious than those for China. According to the report, Brazil is the biggest apparel market on the continent. Its sales in the sector are estimated at $42 billion. However, retailers still prefer to first expand in Mexico and Chile because of Brazil’s rough business conditions.
Russia, Malaysia and Turkey
The countries which diversify the index are Russia (7), Malaysia (8) and Turkey (10). Turkey has a stable reputation of a fashion hub and it has a lot of promising fashion talents. Retailers are drawn to the country due to its increasing middle class, large population and credit growth. Russia, on the other hand, impresses with its rapid retail development. In this category, the country has a score much higher than that of most of the top-rated entries in the chart, like the United Arab Emirate (2), Chile (3) and Saudi Arabia (6). Nevertheless, the highest retail development was registered in Malaysia (8). The country tops even the leader in the index, China. However, its low market attractiveness pushes it down the list.
The report concludes that the developing markets are still of high importance for the global retail sector. Moreover, small and big developing countries continue to attract retailers from all over the world even in the most challenging times.
Here is the complete 2013 Retail Apparel Index:
- China
- United Arab Emirates
- Chile
- Kuwait
- Brazil
- Saudi Arabia
- Russia
- Malaysia
- Mexico
- Turkey
