In 2012, retailers have continued their entrances into new markets, such as Asia-Pacific, Africa and Latin America, based on the promise of new customers and regional expansion. But expanding overseas requires a lot of prep work. It means understanding market conditions, having a supply chain in place, building brand awareness and getting to know the vagaries of each region’s real estate laws and structures.
To grapple with the ramifications of this, ICSC will be hosting the Retail Real Estate World Summit from September 11 through 14 in Shanghai, China.
The summit will assemble industry, political and financial leaders who will openly discuss the globalization of retail. Areas that will be discussed include the globalization of retail, the state of retail real estate investment, the effect of macroeconomic conditions and political climate and best practices for global retail property development.
Glenn Rufrano, president & CEO of Cushman & Wakefield and an ICSC past trustee is speaking on the summit on a session entitled The Global Retail Panorama. Rufrano sat down with Retail Traffic to discuss the conference as well as how retailers go about deciding to expand internationally and what happens after they make that decision.
Retail Traffic: Why are U.S. retailers increasingly considering international expansion?
Glenn Rufrano: If you think about what’s going on here, we certainly, as did other places, from 2008 to 2010 had some issues in the economy, including high unemployment and reduced consumer spending. So that creates an environment without much growth. Even today, with things a bit better, retailers are looking at 1.5 percent to 2.0 percent growth rates. So you have to think about where you can be where there is more growth.
Additionally, many retailers have matured in their penetration of markets within the United States. And so they say, “Well, I now need new stores. What can I do?”
Two questions arise. Are there areas growing more than the United States? Yes there are. And, secondly, where can I put myself that is the most profitable?
That will translate for many retailers into looking at dense urban centers. So can they find growth markets and can they find dense urban centers and can they find growth markets with dense urban centers?
Continue reading the interview at RetailTraffic.com.