Top 5 strategies for successful retail 2024: Part 4, have a global view

In today's ever-evolving retail landscape, balancing immediate hurdles with future growth is crucial for success. High inflation, the lingering effects of the pandemic, and geopolitical tensions present retailers with soaring costs and consumers with financial strains.

However, some retailers have flourished amidst these adversities thanks to their agility, deep consumer insights, and strategic investments. The question is, how have these factors contributed to their success, and what are their plans for 2024? The latest Retail Report for 2024, featuring insights from 44 leaders of UK and international firms, sees these retailers share their strategies for the coming year.

Marked by an overarching sense of optimism, here we share part four of five main takeaways for retailers looking to fine-tune their strategies for 2024.

#4 A global comparison

In today's shifting landscape, having a global viewpoint can make all the difference between success and failure. In addition to investing in new technologies and store employees, a "significant" number of the retail leaders surveyed for the report, including executive management members at Primark, Bravissimo, Mamas & Papas, and Fat Face, highlighted international expansion as one of their main three investment areas for 2024.

Some, such as Primark, already operate an international network of retail locations. In contrast, others noted that they were investing in building strong foundations for expansion by setting up customer support teams or establishing multichannel strategies.

Retailers' focus on international expansion comes as the global economic outlook appears more promising in 2024 versus 2023. According to the European Commission, the collective economies of its 27 member countries are expected to expand by an average of 1.7 percent in the coming year. Meanwhile, the International Monetary Fund (IMF) projects the US economy to grow by 1.1 percent and the Asia-Pacific region by 2.4 percent.

International opportunities for retailers

Several of the UK retail leaders surveyed noted that the Middle East and North America were the main areas of focus for retail expansion and building an international presence. UK retailers, including Fat Face and Primark, are investing in expansion in North America in 2024, focusing on strengthening their retail footprint in critical locations. At the same time, these retailers are also growing their presence in different locations, such as Europe, taking a digital approach in some cases.

Other retailers questioned revealed they are opting for franchise agreements, especially in the Middle East, as it allows them to reach international markets faster while leveraging off the franchisee's capital investment, infrastructure, and local expertise. With a lower risk threshold, a franchise model can be the ideal vehicle for many retailers as long as the brand identity and concept are carried over effectively.

With retail sales growing in the US and expected to reach between 5.13 trillion USD and 5.23 trillion USD this year, according to the National Retail Federation (NRF), the market is becoming more and more appealing to international retailers. In fact, the 2023 forecast for retail sales growth in the US, exceeding the pre-pandemic annual average of 3.6 percent, further positions it as a key market for UK retailers looking towards international expansion.

Online and offline expansion

Although many of the retail leaders surveyed are looking to physical retail expansion, the report also found that online expansion was gaining more traction and could offer retailers another pathway for growth. US online retailer Outfittery highlighted the importance of technological investments like AI to help drive personalization at scale while ensuring it continues to meet customer expectations by having the correct items available.

Overall, retail leaders stressed the importance of exploring new retail strategies in 2024, which could take shape in international expansion into new markets, growing in emerging online marketplaces, or creating a new retail experience - all of which offer them a way to connect with new customers and new avenues for growth.

Stay tuned for the final instalment next week, part 5.