Venezuela Retail Report

Published 05 January 2015

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

BMI View: As a result of the adverse business environment, particularly in terms of import restrictions and an expected fall in household income, the outlook for the Venezuelan retail sector remains bleak over our forecast period. We expect to see negative growth in total household spending in 2015 and 2016 although positive growth is forec ast to continue from 2017 as the long-term economic outlook appears brighter.

Economic instability and Venezuela's business environment are two key drivers behind our decision to downgrade projections over the forecast period. Investing in the country's retail sector presents challenges as high inflation and exchange rate issues have seriously dampened purchasing power. In September 2014, Venezuela's inflation rate rose to 63.4%, the highest in Latin America, resulting in soaring prices for many goods and consumers' inability to afford products, particularly imported ones. Moreover, the government have imposed exchange controls since 2003 and have since then tightened its restrictive policy, making it harder for companies to import foreign items. This has severely limited the range and number of items available in the retail market, deterring new entrants and limiting household spending.

Also, due to supply issues resulting from import restrictions, international players such as fashion retailers Bershka and Zara have had to limit consumer purchases. As a result of offering low-prices in their outlets across Venezuela, both retailers have experienced a surge in demand for their products which led to the decision to restrict the number of purchases possible per customer. This indicates that purchases will be largely price-driven during our period; and as inflation rates look set to remain relatively unstable, consumers are likely to bulk-buy available items when prices are low. Discount retailers will benefit from this, as price sensitivity largely determines the level of household spending.

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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 2011-2018)
13
Table: Retail Sector Spending, % Of Total (Venezuela 2011-2018)
14
Table: Retail Sector Spending, % of GDP (Venezuela 2011-2018)
15
Table: Headline Retail Sector Spending (Venezuela 2011-2018)
16
Retail Sub-Sectors Forecast
18
Food And Drink
19
Table: Food, Drink & Tobacco Spending (Venezuela 2011-2018)
20
Clothing And Footwear
20
Table: Clothing & Footwear Spending (Venezuela 2011-2018)
21
Household Goods
21
Table: Household Goods Spending (Venezuela 2011-2018)
22
Personal Care
22
Table: Personal Care Spending (Venezuela 2011-2018)
23
Household Income And Numbers Forecast
24
Table: Household Data, 2011-2018
24
Table: Labour Market Data, 2011-2018
26
Demographic Forecast
27
Table: Total Population (Venezuela 2011-2018)
28
Table: Population: Babies (Venezuela 2011-2018)
28
Table: Population: Young Children (Venezuela 2011-2018)
28
Table: Population: Children (Venezuela 2011-2018)
29
Table: Population: Young Teens and Older Children (Venezuela 2011-2018)
29
Table: Population: Young People (Venezuela 2011-2018)
29
Table: Population: Older Teenagers (Venezuela 2011-2018)
30
Table: Population: 21yrs + (Venezuela 2011-2018)
30
Table: Population: Young Adults (Venezuela 2011-2018)
30
Table: Population: Middle Aged (Venezuela 2011-2018)
31
Table: Population: Urban (Venezuela 2011-2018)
31
Macroeconomic Forecasts
32
Economic Analysis
32
Table: Economic Activity (Venezuela 2009-2018)
36
Industry Risk Reward Ratings
37
Latin America Risk/Reward Ratings
37
Table: Latin America Retail Risk/Reward Ratings
37
Industry Risk/Reward Ratings
38
Rewards
38
Risks
38
Market Overview
39
Retail Subsectors
40
Tourism
42
Competitive Landscape
43
Malls And Department Stores
43
Mass Grocery Retail
43
Glossary
45
Methodology
53
Industry Forecast Methodology
53
Sources
56
Risk/Reward Rating Methodology
56
Table: Retail Risk/Reward Ratings Indicators
58
Table: Weighting Of Indicators
59

The Venezuela Retail Report has been researched at source and features Business Monitor International (BMI)'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