The 18th edition of the ‘Global Powers of Retailing’ report from Deloitte identifies Woolworths among the largest retailers around the world by revenue. Woolworths is number two in the Asia Pacific top 10, after Japanese retailer Aeon.
Woolworths ranked 18th in the world, according to the report. While this is lower than last year’s rankings (15th), the drop is largely driven by about 11% devaluation in the Australian dollar against the US dollar. Excluding this exchange rate movement, Woolworths would have remained in the top 20, growing retail revenue in excess of about 4%, excluding exchange rate fluctuations.
The composition of the top 10 global retailers remains the same as last year, with Walmart continuing to be the world’s largest retailer by some margin. However, there has been some movement in the rankings within the top 10. Costco has leapfrogged Tesco into second place, driven both by its impressive ongoing sales growth as well as a strengthening in the Euro compared to the US dollar. Tesco dropped from second place last year to fifth, as a result of both declining sales and a weaker British pound against the US dollar.
The report also highlights that 37 of the world’s top 250 retailers are now operating in Australia (up from 30 last year) and the trend of global retailers establishing a presence in Australia is expected to continue apace in 2015.
“In 2014 we saw the likes of H&M, Fast Retailing [Uniqlo], Forever 21 and, most recently, Sephora entering the Australian market with bricks and mortar stores,” said David White, Deloitte Australia partner and retail industry leader. “There was also the takeover of David Jones by South African-based retailer Woolworths SA.
“With a weakening Australian dollar and ever-increasing competitive pressures, we expect to see further interest by overseas retailers in the Australian retail market. As major global players continue to enter the Australian market, and existing global retailers expand their store footprint, Australian retailers across all segments will continue to face significant challenges and increased competition. The ability to innovate, drive improved processes and to connect with the consumer will be critical in order to remain competitive.”