The sustained growth of the economy in the past few years has attracted big foreign businesses to make significant investments in the country. One of the most prominent examples of this is the increase in multinational retail brands that have expanded their operations in the Philippines.
Indeed, the attractiveness for foreign brands to set up shop in the Philippines will only increase once the government enacts changes to its capital requirements. Last October, it was reported that the government plans to reduce the minimum paid-up capital required of foreign retailers from $2.5 million to $200,000.
For property consultancy Colliers International Philippines, this presents one of the best opportunities for multinational businesses to start opening stores in the country. But in its report on the retail property market for the third quarter of 2017, it pointed out that opportunities for foreign retailers vary by type of product. Some product lines are already dominated by foreign brands while others are dominated by domestic brands.
In the infographic above, we show Colliers’ analysis of eight types of items and how many local and foreign brands are carried by retailers, particularly in malls. According to its data, goods such as home furnishing, jewelry, and food and beverage (F&B) see high representation from local brands. On the other hand, the market sees more foreign brands in shoes, sporting goods and apparel.
For Colliers, the dominance of local retailers in some goods, particularly home furnishing and F&B, presents more opportunities for foreign businesses intending to enter the Philippine market. It added that this is supported by “a sustained demand for home furnishing" and an increasingly diversifying F&B mix in the country, particularly in Metro Manila and other urban hubs.
“We encourage foreign retailers planning to enter the Philippine retail market to zero in on the thriving F&B and home furnishing opportunities,” wrote Colliers in the report.
Lorenzo Kyle Subido is a staff writer of Entrepreneur PH