PwC Middle Market Barometer - Retail Industry

14/03/16

 

 

 

PwC Malta’s first market barometer for 2016 reports on the business of local retailers during the 2015 festive season. Interviews were carried out with over 280 retailers, representing operators in the food and beverage, clothing, ICT, and the cultural and recreational businesses. The population sample covers retailers in Valletta, Sliema, St Julian’s, Hamrun, Paola and Gozo. Kevin Valenzia, Territory Senior Partner at PwC Malta, pointed out that the results of these barometers demonstrate the resilience of retailers in an environment which continues to offer opportunity for business despite being increasingly competitive.

The detailed results of the barometer indicate that last December was probably the most positive festive season in the last 3 years. On an aggregate level, 32% of the businesses interviewed registered an increase in turnover as compared to 18% in 2014 and 2013. 32% of retailers experienced a decrease in turnover, a notable decline when compared to the 48% and 31% reported in 2014 and 2013 respectively. From a geographical perspective, in contrast to figures reported in 2014, retailers in Paola reported a marked turnaround in business, with 48% reporting an increase. From an industry analysis, retailers engaged in the sale of food experienced the highest increase in business. It also transpired that operators in ICT are less upbeat.

The retailers interviewed in the barometer were asked to indicate their top business concern and parking and accessibility emerges as the most common factor. Retailers in Sliema, at 56%, top the list of businesses that identified parking and accessibility as their top concern, whilst Valletta, Hamrun and Gozo follow at 47%, 39% and 37% respectively. As expected, the emergence of online shopping continues to be the other major concern across all sectors included in the Barometer, with 28% of those interviewed highlighting this area. The exception was the retail of food and beverages, with this sector identifying shopping malls as their major threat.

The barometer confirms a trend, which sees customers looking out for particular brands in their shopping considerations. 42% of businesses interviewed consider that their customers are increasingly becoming brand conscious. Brand considerations are most pertinent in the ICT and clothing industry and the barometer reports that 63% and 43% of the customers in the respective industry sector link spending to their brand loyalty.

Local retailers are increasingly keen in promoting their products on social media. 31% of the businesses interviewed listed social media, particularly Facebook, as their primary marketing medium. Online adverts, and radio and TV, at 8% and 6% respectively follows as the most popular marketing media used by retailers.

37% of local retailers hold a positive outlook for the next 6 months. This represents an increase of 15 percentage points when compared to last year, but falls short of the 2013 mark, when 41% held a positive outlook.

The percentage of retailers holding a negative outlook, at 13%, is the lowest registered in the last 3 years by the PwC Retail Market Barometer. Sliema and Gozo retailers appear to be the most upbeat about business prospects for the next 6 months.

The results of the market barometer is analysed by locality and sector, may be found on www.pwc.com/mt/barometer


 

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Contact us

David Valenzia

Territory Senior Partner, PwC Malta

Tel: +356 2564 6892

Elizabeth Camilleri

Communications, PwC Malta

Tel: +356 2564 6734

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