BMI View: The growth outlook for Poland ' s large and diversified retail market is mostly positive. Healthy economic growth in the country, where GDP is forecast to increase by 3.7% in 2016, along with falling oil prices and strong employment growth all indicate a rise in average household income rates and we are currently forecasting spending increases across all retail subsectors when measured in local currency term s, though t he loss of the value of the zloty against the dollar means in US dollar terms the market will contract in the short-term, before returning to positive growth. There are some potential downside risks. A number of government policies enacted in recent months have been seen as anti-foreign investment and there are limitations in the labour market which will hamper both the sourcing of adequate skilled labour and hamper wage growth over the coming years .
|Headline Household Spending|
|e/f = BMI estimate/forecast. Source: Eurostat, BMI|
Key Views And Developments
Poland's retail sector continues to attract foreign investment. UK based Tesco announced in June 2016 it was opening a new distribution centre in Poznan which will service 140 stores from September 2016, reiterating its committment to the market following the closure of nine stores in 2015.
In July 2016 Poland's ruling Law and Justice party approved the implementation of a new retail revenue tax which imposes a 0.8% on monthly sales revenue between PLN17mn and PLN170mn and a 1.4% levy on monthly sales venue over PLN170mn. The government claims this will benefit smaller chains competing with large foreign retailers however critics argue the tax will deter investors in a market where profit margins are already slim.
Poland presents retailers with one of the largest potential consumer markets in the region, with a population of around 38.6mn (in 2016). Urbanisation rates are also growing, with the percentage of the population living in urban areas forecast to reach 60.7% in 2020.
Improving employment rates amidst a tight labour market is boosting income levels and the number of households in the key USD10,000+ bracket is expected to reach almost 9.5mn in 2016 - accounting for almost 70% of all households and indicating an increasingly afluent consumer base.
The Poland Retail Report has been researched at source and features BMI Research's independent assessment and forecasts for the retail sector. The report examines key drivers of retail sales growth and future prospects, including consumer spending and private sector investment.
BMI's Poland Retail Report also examines the level of development and potential for growth of the retail sector, the commercial initiatives of major players, changing consumer demographics that influence demand and the regulatory environment. Key sub-sectors include mass grocery retail, autos, over-the-counter pharmaceuticals, computers and consumer electronics.
- Benchmark BMI's independent retail industry forecasts for Poland to test other views - a key input for successful budgeting and strategic business planning in the Polish retail market.
- Target business opportunities and risks in Poland through our reviews of latest industry trends, regulatory changes and major deals, projects and investments.
BMI Industry View
Summary of BMI’s key forecasts and industry analysis, plus a discussion of major industry developments and a snapshot of key short-term demand-driving macroeconomic movements.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the retail sector and within the broader political, economic and business environment.
BMI Industry Forecasts
There are four separate 5-year forecast modules in the retail reports. These are:
- Headline Retail Forecast: Total household spending (local currency and USDbn, % growth, % GDP, per capita, per household), spending by retail sector (food & non-alcoholic drink, alcoholic drink, clothing & footwear, housing & utilities, furnishings & home, health, transport, recreation, education, restaurants & hotels, personal care & insurance (local currency and USDbn, % growth, % GDP, % of total spending)
- Retail Sector Forecast: Breakdown of Food, Non Alcoholic Drink, Alcohol, Tobacco, Clothing, Footwear, Household Goods, Furnishings, Appliances, Glass and Tablewear, Household Textiles, Consumer Electronics, Garden Toys and Pets, Home and Garden tools, Personal Care, Personal Effects Spending (USDbn, % Growth)
- Household Income and Numbers Forecast: Number of Households (‘000, % growth); gross income per household and per capita; net income per household and per capita; tax and social contributions per capita; breakdown of household incomes – USD5000+, USD10,000+ USD50000+ (‘000, % of total); labour force, employment and unemployment (‘000, % change)
- Demographic Forecast: Total population; Babies 0-12 months; Young Children 0-4yrs; Children 5-9yrs; Young Teens and Older Children 10-14yrs; Older Teens 15-19yrs; Adults 21yrs +; Young Adults 21-29yrs; Middle Aged 40-64yrs (‘000, % growth, male, female); Urban Population (‘000, % population); Rural Population (‘000, % population).
BMI’s Retail Risk Reward Index
BMI’s Risk Reward Indices provide investors looking for opportunities in the region with a clear country comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.
Provides a detailed country-specific analysis of the key trends and developments in the retail sector as a whole, as well as an assessment of the main drivers affecting the major retail segments including mass grocery retail, fashion, pharmacies, consumer electronics, home improvement and personal care. The market overview also considers the most effective store formats in a given country and the impact of these factors on the main international and domestic players’ development strategies.
This provides a brief overview of the key players in each subsection of the retail sector including MGR, Fashion, Home Improvement, Consumer Electronics, Pharmacies, and Department Store chains.
The Retail Reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.