In face of competitive pressure, retailers must be innovative in developing store formats and offering a wide range of products to secure market share in the low-growth home market, a marketing professor said yesterday.
While Wal-Mart and Carrefour have evolved into leading retail firms, smaller players would not necessarily find themselves squeezed out as long as they are innovative and efficient, John Dawson of the University of Edinburgh told the Taipei Times.
For example, in Spain, where Carrefour has a strong presence, traditional markets and smaller hypermarkets able to take locations that complement those of Carrefour are doing well, he said.
"The key to success for retailers lies in innovation and the totality of the stores, ie, total in-door experience of receiving services and buying products, which determines whether shoppers want to come back again," he said.
Innovative approaches are already seen in the UK's largest retailer Tesco and Japan's Ito-Yokado. Tesco has developed from its core hypermarket business in the UK to offer insurance, telecommunications and Internet shopping, while Ito-Yokado provides banking services in its convenience stores, he said.
Since Tesco entered the local market in 2000, it has offered 24-hour service in its four outlets. A fifth outlet, in Taichung, will open at the end of this year.
Except for the Taipei outlet, all Tesco's stores present an integration of hypermarket and shopping mall which have an average of 70 retail and food outlets, said David Orchard-Smith, chief executive of Tesco Stores (Taiwan) Co.
Its fifth outlet will follow the same format, he said.
Carrefour Taiwan will launch its first hypermarket-cum-shopping mall next Friday in Hsintien. It has invested NT$1.4 billion (US$45 million) in the complex that will house B&Q Taiwan, an indoor golf practice court, a gym and 80 other tenants.