Retail Management 12th Edition by Barry Berman ,Joel Evans

Exercise 4

Case 4: Growth Reimagined: Prospects in Emerging Markets
Let us examine the findings of a recent Price water house Coopers (PwC) Annual Global CEO study. In particular, that report looked at how 75 retail CEOs (chief executive officers) in 30 countries are approaching growth prospects at a time when economic growth is uncertain. At the time this study was conducted, the global economy was still recovering from the worst economic crisis in the past 75 years.
PwC found that, in general, retail CEOs have renewed confidence in their firms' growth prospects. Ninety percent of the CEOs expect to have higher sales within a one-year period, and 93 percent expect sales to climb over the next three years. This shows more confidence than the prior year's study when only 74 percent of retail CEOs were either somewhat or very confident of having increased sales over the next fiscal year. The respondents were particularly positive about their Asian operations, with 93 percent of the respondents stating that they should be able to expand their Asian operations over the next year. In addition, 55 percent of the CEOs also saw promise in their West European retail operations.
In the recent study, the CEOs were also very positive about emerging markets, such as China and India, due to rising consumer affluence, the growing middle class, good economic growth (especially as compared with developed economies), and new legal developments. Indian regulators, for example, have been considering whether to allow foreign "big-box" retailers to own up to 49 percent of joint ventures with Indian retailers as majority partners. Before this development, foreign retailers could only sell one brand in each store. Thirty-three percent of retail CEOs view China as one of the three foreign countries most critical to their companies' growth.
In earlier PwC studies, retail CEOs viewed their best opportunities for growth to be obtaining higher market shares in their core markets. The latest study shows the shift to developing new products and services relating to mobile devices and social networks, green products, and achieving shared priorities with governments.
Globally, retail CEOs are aware of the greater importance of mobile devices and social networks that affect the shopping process and information search. Fifty-three percent of the respondents stated that they are making major changes in their retail strategies to capitalize on these developments. Fifty-seven percent of the retail CEOs stated that one of the major reasons they are investing in information technology is to support mobile devices and social networks. Interesting, even though all of the retailers had Web sites, only two-thirds of the retail firms could handle an E-commerce transaction.
While only 52 percent of the respondents view their responsibilities to include developing green products, many CEOs have become more involved with using sustainable products, developing products with low emissions, and becoming more active with product recycling. These retailers are working closely with suppliers to develop ecologically suitable products.
Lastly, retail CEOs are concerned about the impact of reduced local, state, and federal budgets on economic growth, employment, and consumer spending.
1. Discuss the pros and cons of a retailer's developing new stores in domestic markets instead of China and India.
2. Develop a research study proposal to evaluate the impact of mobile devices on a consumer's information search behavior.
3. What factors explain the relatively low percent of retailers capable of handling an E-commerce transaction
4. Devise a brief survey to show how much interest that people have in shopping with retailers that are environmentally conscious.