The Digital Economist

The young demographics of the country, the rising disposable income of its young population, remain as key drivers of domestic consumption. There are other factors that drive the retail industry to grow such as: Increased consumer spending due to reduced unemployment rate brought by the BPO and the overseas work.  This increase in income of the households is boosting retail sales. Easy Bank Loans: Bank is offering credit with easy terms to the retail companies and financing up to 60% of capital.  There is a high availability of financing channels. Increase in Demand is leading to the growth of Organized Retail:   Entry of foreign brands and consumers desire to try new brands is driving retail industry; this increases the availability of product options. Omni Channel , the rise in a multi-channel sales approach that provides the customer with an integrated customer experience. The customer can be shopping online from a desktop or mobile device, or by telephone, ...

The Philippines remains at the forefront of the Asia Pacific (APAC) growth, underpinned by solid macro fundamentals that are driving sustained positive economic expansion. The country posted a 6.7% Gross Domestic Product (GDP) growth at the end of 2017.  Strong investment in infrastructure and construction, and solid household consumption, stimulated by low inflation and interest rates, boosted the economic growth of the country.  Beyond these indicators, the potential gains from the demographic dividend combined with the large volume of mall space and competitive occupancy costs remain as its two distinct advantages, overall, which should help the country become one of the attractive retailer destinations in APAC.

Although many prefer online shopping, it only amounts to 39% e-commerce penetration, as of end of 2017. According to We are Social and Hootsuite, e-commerce shoppers in the Philippines spent an average of $37 (Php 1,900)  in 2017. 

What does the Philippine Retail Industry looks like? It is composed of diverse players, tapping on what appeals to the market considering the psychographics of Filipino consumers: Awareness of Global brands among Filipinos. With the advent of smartphones, access to internet and information, Filipinos are now more knowledgeable about the products available in the market. Changing Global Retail Landscape. More foreign brands want to invest in the Philippine Market.  In the 2017 report of Cushman & Wakefield: How Global Brands are Shaping the Metro Manila Retailer Landscape,  foreign brands view Philippines to be one of the key focus markets within the Asia Pacific region due to the rising disposable income of its young population and increasing demand for household consumption. Increasing preference for online shopping. With the convenience and product options e-commerce has to offer, more and more shoppers are now going online. Franchising of Brands. Franchising...

What does it looks like? The Philippines with its solid macroeconomic fundamentals; young working population, rising disposable income of its young population, is an attractive destination for global brands. Economic activities that are a driving sustained positive economic expansion. Rising disposable income triggering the demand move in upward slope. This rising disposable income and increase in demand for a variety of commodities attracts foreign brands to enter the Philippine retail landscape. In a research conducted by the Business Insider in United States, 8,053 retail outlet closures were announced in 2017, and more than 3,800 will close in 2018. These figures are driven by the increasing preference for online shopping. While many retail stores in the United States and elsewhere in the world have been affected over the last few years, rendered obsolete by the consumer’s growing preference for online shopping among other factors, the Philippines meanwhile h...

Retail ecommerce sales in Asia-Pacific grew 31.1% in 2017 to $1.349 trillion. Gains were fueled by retailer competition, falling prices and mobile shopping uptake among consumers. Nearly 83% of sales came from China alone—the biggest e-commerce market in the world. Total retail sales in Asia-Pacific increased 7.7% in 2017, matching to $9.268 trillion. Several markets experienced higher consumer spending and e-commerce activity, as well as improving export business.