2014-03-30 03:35:48 - New Retailing market report from Business Monitor International: "Bahrain Retail Report Q2 2014"
Bahrain's increasingly sophisticated urban population is forecast to continue spending on nonessential items such as luxury clothing and jewellery over the next few years, leading to a steady expansion of the kingdom's retail sector. This will result in a strong rise in household spending across all retail subsectors, with the growth prospects for food & non-alcoholic drinks and recreation & culture being particularly strong. Spending on personal care, communications, clothing & footwear and furnishing & home is also projected to increase significantly between 2014 and 2018. However, we expect housing & utilities expenditure to remain by far the highest throughout our forecast period.
Full Report Details at
The new Bahrain retail report provides an extensive and comprehensive forecast of
various retail indicators including household spending, and headline total spending across each retail subsector, household income and employment forecasts, demographic forecasts, and a detailed breakdown of household and per capita spending across a large number of retail areas including food & drink, healthcare and insurance, consumer electronics, toys, pets, gardens, household goods, and a number of other subsectors.
The Bahrain retail market is substantially less developed than those of Dubai or Abu Dhabi, with convenience stores still very much part of the retail scene and traditional markets (souks) continuing to dominate the market for traditional services and goods such as gold, fabric and sweets. However, Bahrain's love affair with modern retail is intensifying, with 'super malls' such as the Bahrain City Centre development revolutionising the retail scene. Bahrain's growing population, increasing levels of disposable income and proximity to Eastern Province in Saudi Arabia have all contributed to a significant increase in the size of the retail market in the past decade.
We forecast that the average net household income will be around US$67,339 in 2014, with more than 87% of all households in the middle-income bracket of US$10,000+. A significant percentage (46.8%) of households falls into the highest US$50,000+ wage bracket, and this is forecast to rise to 55.8% by 2018.
This represents the key demographic for increased household spending on luxury items beyond necessities such as food, utilities and transport, and will result in a corresponding increase in household spending on health, communications and personal care.
However, we note downside risks to our forecasts from the continued uncertainty of Bahrain's political trajectory. We expect Bahrain's political impasse to remain unresolved throughout 2014, and see few signs that a breakthrough is possible over the coming quarters. The regime will remain firmly entrenched for now, having adopted a successful but short-term strategy of 'divide and conquer' against the Shi'a opposition.
Recent Developments Include:
British premium supermarket retailer Waitrose's six shops in Bahrain have closed after its local partner Supa Save Bahrain went into liquidation; it has been reported that two of the shops will reopen as Jawad-branded supermarkets. The Al Rashid Group has announced plans to open 15 new stores over the next few years in Juffair, Hamad Town, Riffa and Muharraq. Ford Middle East has reported a 23% rise in sales in Bahrain in 2013.
Key BMI Forecasts:
* We expect total household spending to be US$15.0bn in 2014.
* Household numbers will reach almost 150,000 in 2014, representing growth of 0.8% year-on-year. We expect the rate of growth to accelerate slightly throughout our forecast period, averaging 1.3% annual growth to reach 159,053 households by 2018.
* More than 70,000 households will be in the US$50,000-plus income bracket by the end of 2014, according to our forecasts, and we expect this figure to increase to 89,000 by 2018.
* In our proprietary Risk/Reward Ratings, Bahrain sits in sixth place regionally overall, with its overall score boosted by high per capita household spending but dented by its small population.
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