CBRE: London is number one destination for world's top retailers (UK)

London has emerged as the most international retail city in the world, attracting 60% of the world's top retailers, according to the latest retail research report from CB Richard Ellis, How Global is the Business of Retail? London was followed by Paris (49% of retailers) and New York (47%) to round out the top three most popular destinations for retailers, but the surprise entry in fourth position was Dubai, enforcing its importance to the global retail landscape.

CBRE's annual study mapped the global footprint of 280 of the world's top retailers across 67 countries, exploring the globalization of the retail industry and highlighting differences between sectors and regions, thereby identifying trends in the patterns of global retail expansion. For the first time, the 2009 report also analyses retail globalization at a city level, allowing for additional scrutiny of retailer expansion strategies.

Europe's major capital cities dominated the survey's ranking of the top 10 most international retail cities, comprising seven of the 10 leading destinations. New York City, Dubai and Tokyo were the exceptions to this rule, representing their respective global regions. Dubai's fourth position ranking, closely trailing New York, confirms its position as a new force in global retailing. Its rapid emergence as a retail hot spot can be attributed to a number of factors: the recent development boom in Dubai which created significant amounts of new retail space; the region's appetite for international brands; and the network of franchise partners which help retailers to effectively expand into this market. Asian cities were also strongly represented in the global ranking, with Tokyo, Singapore, Hong Kong and Beijing all featuring in the top 15 most international retail cities.

The study also analyzed retailer expansion into primary versus secondary cities within specific markets, unveiling some interesting insights into the international expansion strategies adopted by the retailers surveyed. Whilst 'primary' cities, such as London and Paris, continue to attract the majority of international retailers, secondary cities such as Manchester and Lyon respectively (the next largest cities in those markets) only draw 60% of the international retailers present in the capitals. This trend is also reflected in the US, where cities outside New York only attract 65-75% of the retailers present in New York. Across all global markets surveyed, the secondary city in a market has on average 58% of the retailers that are found in the primary city. Germany however, is a market which bucks this trend, with over three quarters of all international retailers present in Berlin also represented in Munich, Hamburg and Cologne.

Some international retailers enter a new market in order to build a presence across a variety of cities, allowing them to exploit fully the opportunities within a particular country using a network of stores. The other entry strategy is via a 'flagship' store, where presence in one city allows them to target a high proportion of their potential market in that country. The flagship approach is commonly the preferred expansion strategy of luxury brand retailers, particularly within emerging markets where there is a high concentration of national wealth in the principal city. The target cities of a flagship network are also often among the most visited tourist destinations in the world, giving added exposure. The flagship model also appeals to luxury brands. Being present only in the leading cities of the world creates additional exclusivity and allure, characteristics which luxury retailers aspire to.

Peter Gold, Head of EMEA Cross Border Retail, CB Richard Ellis, said: "Now more than ever, retailers are less concerned with 'markets' and more with 'shopping populations' – it is often the city and not the country which is important. Our study emphasizes this micro-level focus, showing that the expansion of an international retailer into one city does not necessarily imply they will expand across other cities in th

Related News