Asia will account for 45 per cent of global retail sales next year
The world’s retail market is expected to slow down next year, but Asia will account for 45 per cent of global retail sales, according to a new report from economic and business research group The Economist Intelligence Unit.
In terms of volume, sales growth will slow compared to this year, but in US-dollar terms growth will accelerate. This divergence will reflect differing regional trends in demand, pricing and exchange rates, with developing markets outpacing developed ones.
“It’s a mixed picture for global retail sales in 2020,” said The Economist Intelligence Unit consumer goods analyst Shveta Sharma. “Although there will be areas of opportunity, particularly in Asia, there are several threats to the industry.
“The US-China trade war, Brexit and the protests in Hong Kong will all take a toll, while some retailers will also struggle to keep up with the continued shift online. We expect more store closures and job cuts.”
Online retail will continue to undermine the competitiveness of brick and mortar stores next year, she said. Growth will be driven by social media apps such as TikTok and Instagram, as well as better digital payment systems. Retailers and consumer goods producers will need to adapt quickly to changing local conditions, shifting suppliers and closing stores as demand patterns change.
The EU, however, is leading a backlash, scrutinising the marketing tactics of online players as well as their efforts to avoid taxes. The scale of job cuts will also prompt more scrutiny in the US, in the run up to November’s presidential election.
The group’s full report on global retail sales is available for download here.