The 2014 Retail Outlook highlights modest growth for the retail sector at 3.8%, driven by tough competition and cautious consumer behavior. Key trends include the emergence of new players with innovative business practices, increased capital expenditures, and a shift towards larger competitors. The document emphasizes the importance of retail brand power and the challenge of customer-driven shopping in an increasingly international marketplace.

1. 2014 RETAIL
OUTLOOK & TRENDS
BNC Tech Forum
March 5, 2014
Peter Woolford

2. AGENDA
• Retail Council of Canada
• 2014 Outlook
– Sales, Costs, Margins, Investment
• Retail Trends – WIIFM?
– Internationalization
– Consolidation
– Retail Brand Power
– Online shopping

3. THE VOICE OF RETAIL
• 45,000 storefronts
• All formats, sizes, and channels
• Member services:
– Advocacy – Events
– Education – Publications

4. 2014 OUTLOOK

5. DÉJÀ VU, AGAIN
• Modest growth – 3.8%
• Tough competition
• Cautious customers
• Cost pressures

6. MODERATE GROWTH

7. WORK THE INVENTORIES

8. THE BIG SQUEEZE

9. PRICES / MERCH COSTS

10. CAPITAL EXPENDITURE
• 47% will increase cap ex
• 25% will decrease cap ex
• More diversity in investments
• 71% will increase selling space

11. RETAIL TRENDS

12. NEW KIDS ON THE BLOCK
• New players bring
– new concepts, business practices
– I.T., investment
– strong capital base, low overheads
• Online
• HQ consolidation
– Fewer decision-makers in Canada

13. FEWER & BIGGER
• Bipolar customer
• Share moving to larger
competitors
• Mass merchants, big boxes,
specialists
• Selling to / competing with fewer,
more powerful retailers

14. RETAIL RULES
• Power of retail brands
• Aggregator of demand
• Private label
• Vertical integration
• “Coopetition” – Music example

15. BRAVE NEW WORLD
• Truly international
• Canada lags
• Customer-driven, not tech-driven
• Omni-channel, but customer
shops differently
• All about price / complete price
transparency

16. QUESTIONS?
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