RETAIL

Prolonged store closures and economic recession to hit discretionary retail hard

S

SENSITIVE RISK for entreprises

  • Fragmentation

  • Internationalization

  • Capital Intensity

  • Profitability

  • Resilience of household consumption for food and staples
  • “Modern retail” still has a lot of room for expansion in emerging markets
  • Expertise of established players on supply-chain issues
  • Changing consumer habits are an opportunity
  • Expertise of established players on supply-chain issues
  • Strong price competition and overall limited room for differentiation for food retailers
  • Cut-throat competition between online and incumbent discretionary retailers
  • Household consumption for non-food items is far more volatile and sensitive to economic downturns
  • In the face of growing e-commerce penetration, adaptation to new business models proves very challenging for incumbent retailers

Key players

Country Role Sector risk
United States

#1 retail market

C

Sensitive risk

China

#1 retail market

C

Sensitive risk

Japan

#3 retail market

C

Sensitive risk

Contact Euler Hermes

Economic Research Team

research@eulerhermes.com

Sector Risk Analyst

Aurélien Duthoit

aurelien.duthoit@eulerhermes.com

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