Retail in a global economy has unlocked multiple channels and opportunities for retailers to enter or expand operations in developing growth markets. The diversification of business demand is critical to counter economic stagnation. But, the capability to safely and successfully port your brand across continents is harnessed through streamlined core operations. Retailers need to be more strategic, as each marketplace represents unique advantages and challenges. While India’s PPP ranking is high, its foreign investment policies remain restrictive. China’s increased demand for western goods needs to be carefully routed through its extensive tax regime.
Retail brands are adapting to local culture, skill-sets and eco-systems. They balance localization with customer expectations by fine-tuning store models and personalizing online strategies. For example, Walmart in America is focused on bargains and selection; the same is true in China, but for different items. Real estate is much more expensive in China, so Walmart purchases a small plot of land and creates several levels, like a mini shopping mall, instead of a single level that is spread across what seems like acres in America. However, the quantities are kept smaller in China as most houses in China are small and do not have room to store bulk purchases. Samsung plays an active role in understanding local appetites, customs or preferences to meet customer needs – In Bulgaria, yogurt is an important part of the local diet so they developed an oven able to produce the perfect homemade yogurt in seconds.
Regional retailers are also flexing their marketing muscle to maintain growth, as global players increase footprint in their respective regions. The future will lead to increased localization efforts by foreign retailers to fortify market positions. Consequently, regional retailers would focus on strengthening existent customer connect while emulating the proven best practices of the larger retail competitors. Technology has played a vital role in enabling globalization across multiple industries including retail. From manufacturing processes established at different continents for cheaper labour and raw material costs to end consumer analytics for determining the right product and market matrix; retailers can expand their supply strategies and introduce cost-effective innovations to operations. This helps optimize business capital expenditure to support local market efficacy and boost global expansion.