200 foreign brands entered
Close to 200 mid-range and luxury foreign retail brands have entered the local market over the last seven years as international retailers seek growth opportunities in fast-emerging Asia-Pacific economies such as the Philippines.
According to a Cushman & Wakefield Research Publication entitled ‘’How Global Brands are Shaping the Metro Manila Retailer Landscape,’’ the last three years have seen a significant number of new foreign retailers in the market, with 2014 serving as the banner year with at least 45 new brands having entered the country.
According to the publication issued this month, the young and growing demographics in the Philippines, accompanied by rising income levels and a healthy stock of retail space offering competitive rents, underpinned the strong retailer interest in the country.
‘’Indeed, the Philippines is a desirable market for international retailers. The strong economic fundamentals and demographics of the country should drive healthy appetite for retail goods,’’ Cushman & Wakefield said in the report. ‘’Retail competition may tighten as existing brands compete against new retailers for the increasingly sophisticated consumer market and limited available shopping space. However, a healthy shopping mall pipeline and presence of latent demand in other areas of the country should be able to accommodate new retailer entrants to the market.’’
According to the global real estate adviser, the Philippines’ expanding middle class, supported by the sustained growth of the business process outsourcing (BPO) industry and overseas Filipino remittances, is driving healthy consumption, which should maintain the country’s attractiveness toward foreign retailers, particularly the mid-range retailers that comprise about 79 percent of the foreign brands that have established presence locally.
‘’Mid-range food and clothing retailers have exhibited the largest growth in the last seven years. Fast fashion brands such as Forever 21, CottonOn, and Uniqlo continue to take up large retail spaces, while quick service food and beverage restaurants/stores such as BonChon, Happy Lemon and J. Co. Donuts, albeit taking up smaller spaces, are active in store expansions,’’ the report stated.
‘’New designer labels such as Hermes, Stuart Weitzman and Casadei have entered the Philippines while select existing brands opened their first dedicated stores in the country. High-end watches Hublot, Baume & Mercier, Breitling,Tudor, IWC and Jaeger-LeCoultre simultaneously opened their first stand-alone stores in Central Square in Bonifacio Global City last 2013,’’ it said.
According to the report, an estimated 123 foreign brands were western retailers. European brands, particularly from France, Italy and United Kingdom, led retail activity from the region.
‘’Alexander McQueen, H&M, Burton Menswear London Stefanel, and Uno de 50 are some of the new European brands that took up spaces in shopping malls in Metro Manila. Nevertheless, American retailers continue to have healthy presence in the country given the historical ties and cultural affinity between the United States and the Philippines,’’ it noted.
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