Venezuela Retail Report

Published 23 June 2015

  • 61 pages
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  • Includes 3 free updated quarterly reports
 
$1,295.00
Venezuela Retail Report

BMI View: As a result of high inflation and a chronic shortage of basic goods in Venezuela the economic outlook remains unstable at the beginning of our period which has seen us forecast negative year-on-year growth rates of total household spending in 2015 and 2016. Moreover, the tough regulatory environment looks set to remain a barrier to entry for international investors within the retail sector until 2019. However, the burgeoning middle-class will stimulate growth in the sector which will see a more positive outlook for retailers by the end of our period.

Low oil prices, high inflation and a poor business environment will see Venezuela's recession stretch into its second year in 2015 and persist into 2016. Following the release of data suggesting that price growth has accelerated, real private consumption growth will be even more subdued than we previously anticipated, prompting us to downgrade our real GDP growth forecasts. We have downgraded our growth forecast from contractions of 3.6% in 2015 and 1.5% in 2016 to declines of 5.6% and 2.9% respectively. We forecast that growth will return to positive territory thereafter but remain low by historical standards. Consumer purchasing power and the government's credibility for macroeconomic governance will both continue to erode, weighing heavily on real GDP growth and household spending levels. This will constrain growth in the retail sector.

Our projections have been downgraded for growth rates across all sub-sectors of the retail sector and we expect all sub-sectors of the retail sector to experience negative growth over 2015 and not recover 2014 levels till beyond 2019. High inflation is a key driver behind this trend, with inflation hitting 64% in Q314 and remaining high since. The government has implemented price controls on certain goods, subsidising basics such as milk and soap however, it is such products which are now in severe shortage in Venezuela and has led to many retailers limiting the...

Table of Contents

BMI Industry View
7
SWOT
9
Political
11
Economic
12
Industry Forecast
13
Headline Retail Forecast
13
Table: Total Household Spending (Venezuela 2012-2019)
13
Table: Retail Sector Spending, % Of Total (Venezuela 2012-2019)
14
Table: Retail Sector Spending, % of GDP (Venezuela 2012-2019)
15
Table: Headline Retail Sector Spending (Venezuela 2012-2019)
16
Retail Sub-Sectors Forecast
17
Food And Drink
18
Table: Food, Drink & Tobacco Spending (Venezuela 2012-2019)
18
Clothing And Footwear
19
Table: Clothing & Footwear Spending (Venezuela 2012-2019)
19
Household Goods
20
Table: Household Goods Spending (Venezuela 2012-2019)
21
Personal Care
21
Table: Personal Care Spending (Venezuela 2012-2019)
22
Household Income And Numbers Forecast
23
Table: Household Data, 2011-2018
23
Table: Labour Market Data, 2011-2018
25
Demographic Forecast
26
Table: Total Population (Venezuela 2012-2019)
27
Table: Population: Babies (Venezuela 2012-2019)
27
Table: Population: Young Children (Venezuela 2012-2019)
27
Table: Population: Children (Venezuela 2012-2019)
28
Table: Population: Young Teens and Older Children (Venezuela 2012-2019)
28
Table: Population: Young People (Venezuela 2012-2019)
28
Table: Population: Older Teenagers (Venezuela 2012-2019)
29
Table: Population: 21yrs + (Venezuela 2012-2019)
29
Table: Population: Young Adults (Venezuela 2012-2019)
29
Table: Population: Middle Aged (Venezuela 2012-2019)
30
Table: Population: Urban (Venezuela 2012-2019)
30
Macroeconomic Forecasts
31
Economic Analysis
31
Industry Risk Reward Ratings
35
Latin America Risk/Reward Index
35
Table: Latin America Retail Risk/Reward Index
35
Industry Risk/Reward Index
36
Rewards
36
Risks
36
Market Overview
37
Retail Subsectors
38
Tourism
40
Competitive Landscape
41
Malls And Department Stores
41
Mass Grocery Retail
41
Fashion
42
Glossary
43
Methodology
51
Industry Forecast Methodology
51
Sources
54
Risk/Reward Index Methodology
54
Table: Retail Risk/Reward Index Indicators
55
Table: Weighting Of Indicators
57

The Venezuela 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 Venezuela 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.

Key Benefits

  • Benchmark BMI's independent retail industry forecasts for Venezuela to test other views - a key input for successful budgeting and strategic business planning in the Venezuelan retail market.
  • Target business opportunities and risks in Venezuela through our reviews of latest industry trends, regulatory changes and major deals, projects and investments.

Coverage

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.

Market Overview

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.

Competitive Landscape

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.

Sources

The Retail Reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc