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Foreign retail brands making successful inroads into Pakistan market

Despite security concerns in Pakistan, the country has witnessed an influx of foreign retail brands. It is a fact that international brands are making entry into the country’s lucrative market by opening their franchises in mega cities and towns. Certainly, the growing number of international entrants in the local market establishes this fact. This year, Xiaomi, a Chinese brand and the world’s third largest smartphone maker made entry into the Pakistani market, a booming market of mobile consumers worth 40 million. China’s most popular smartphone brand has partnered with a Pakistani company ‘Smart Link Technologies’ for distribution and after-sales service, according to officials of company. Xiaomi plans to launch popular smartphones Redmi Note 4 and the Redmi Note 4A, and bezel-less arge Mi Max in the Pakistani market. Vivo, another Chinese brand, plans to enter Pakistan this year. The Chinese company manufactures and designs smartphones, mobile accessories, online services and software. The software development by Vivo include its App Store, proprietary Android-based operating system called Funtouch OS and iManager. With entry of new smartphone players in the market, users will get huge variety of mobile phones.

Moreover, there are many luxury and mass retail brands, which have made entry into the local market. Ralph Lauren and Armani Collezioni have already entered the Pakistani market by launching retail group Sefam. Armani, which currently stocks for only men, keeps standards and prices abreast with those across the world. Armani’s entry into Pakistan shows they deemed it to be an inarguably viable front for sales. Moreover, the entry of BHS and US Polo in the market is also expected. Other international brands Calvin Klein, On Top Barcelona and Silvian Heach are all set to arrive in the market.

Pakistani market currently has the presence of leading international fast food franchises and consumer brands, which are successfully doing their business in the country. This franchise model is actually transferring improved training, technology and business know-how to the local market. This model generates world class professional knowhow. There is a lot to learn from this global franchise model both for the local business chains and the consumers. Foreign brands also give Pakistan a soft image. It is just because of the fast food franchises that we have the presence of auxiliary industries like the home-delivery service and suppliers of quality poultry, meat etc, according to modern quality standards. Presence of international franchises not only retains foreign exchange but also generates jobs. These international franchises provide the rich and affluent, who used to shop abroad, an opportunity to shop and spend money within the country.

IMPRESSIVE GROWTH

With the induction of global brands and outlets, Pakistan’s retail sector is presently witnessing a booming and impressive growth. The local retailers are expanding their boundaries to compete with their larger foreign competitors. With an estimated size of the retail market at around $50 billion, the country’s retail sector is growing faster than its economy. The phenomenal growth in retail sector bodes well for the country’s economic health, as the sector can create enormous job opportunities and attract foreign investment into the country by alluring global brands to the local market.

Today, we find in our cities like Karachi and Lahore big shopping malls and hypermarkets and small and medium scale outlets providing which various different categories of products under one roof. The phenomenal growth in retail sector bodes well for the country’s economic health, as the sector can create enormous job opportunities and attract foreign investment into the country by alluring global brands to the local market. The retailing in Pakistan is going to be shaped in coming years on global retail format. The competition between global retail outlets and local department stores will intensify in future. Research studies show that in Pakistan’s mega cities a majority of households with larger family sizes shop at general stores, while those with smaller family sizes shop at large supermarkets.

Quality shopping has led consumers towards modern retail shopping options. A majority of consumers seek quality products in adequate quantities under one roof. The retail stores and shopping malls have become very attractive to the consumers in Pakistan. For many Pakistanis, a visit to modern retail, hyperstar market and wholesale centers has become a pleasant family outing. New global chains of grocery and life style stores are likely to enter in the country’s market in future. With the entry of giant global retailer, the process of retail modernization may accelerate in the country. The key decision by Pakistani entrepreneurs and professional working for national and multinational companies operating in the country will decide direction of the future growth of retailing industry.

Still there is long way to go and some key initiatives by the government and entrepreneurs need to be taken to meet the future challenges confronting retailing industry in Pakistan. Presently, there is dearth of malls major cities, which means there is not enough space for foreign brands for its operations in the local market. New malls with international standards and according to the needs of international brands must be constructed in major cities such as Karachi, Lahore, Rawalpindi and Peshawar. Lack of good quality retail space is another challenge. All steps must be taken to get the local market ready for arrival of foreign brands such as H&M, Forever 21.

The entry of foreign retail franchises into Pakistan is testament to the enhanced demand of foreign brands among local consumers. The trend of foreign retail outlets continues to expand into other products, services, and brands in the country. Last year, Clarks, the international shoe manufacturer and retailer, arrived in Pakistan by launching its first- ever store in Karachi. The store was inaugurated by the acting Deputy High Commissioner of the British High Commission Gillian Atkinson. The stores are also being opened up in Lahore and Islamabad. The brand has a unique heritage of almost 200 years in remarkable shoe design. It has been successful in becoming the leading shoe company in the UK and a global business in over 100 markets worldwide. With their latest franchise in Pakistan, the brand intends to penetrate the markets and set impeccable shoe-trends. The brand is also well-known for its celebrity clientele and collaborations with high-fashion designers.

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