Almost half of British retailers find the USA the toughest market to crack, according to Barclays
Cracking America is as much of a challenge for our retailers as it is for some of our favourite music stars, if new research from Barclays is anything to go by.
A survey from the banking giant questioned retailers on their attitudes towards international expansion and how they plan to expand, for example, via online channels, opening stores or joint ventures.
Nearly half (46%) of those surveyed said the USA remains the hardest market in which to achieve commercial success, despite being the current destination of choice.
Reports have surfaced recently that Sir Philip Green is hoping to turn Topshop into a $1 billion US business within the next five years, with Hobbs also planning an expansion over the pond.
Nevertheless, despite the growth of online which provides a low-cost means of entry, the States is still considered the most challenging market, followed closely by China with 33% of retailers saying they had trouble setting up shop there.
Asia, more widely, was third with 19% of those retailers questioned claiming they had experienced difficulties.
Asked about future expansion, nearly a quarter (23%) of retailers said Germany was their number one choice for overseas expansion in the next five years, closely followed by China and Australia.
Richard Lowe, head of retail & wholesale at Barclays, said: “On the surface the USA would appear to be an easy market in which to secure a foothold but its sheer scale means achieving commercial success across the whole country is an incredible feat. As for China, nothing is impossible but, everything is difficult.”
Finally, only 21% of retailers said they currently generate sales on the continent with 53% of those who do explaining that South Africa is their top market.
Other markets currently providing revenues for British retailers in Africa include Chad, Congo, Morocco and Nigeria.
Perhaps our retailers should turn to One Direction for some advice – although we suspect most of them have too much pride at stake.