Watching the Global Economy is no less than experiencing a Roller Coaster ride, the higher it goes the faster it falls. In the past few years the global economy witnessed a slowdown that affected all the Businesses and Industries. But despite these tough economic conditions, there is one industry that showed continuous growth throughout this period – The Global Retail Industry. Since 2010, the retail industry has shown a consistent rise of 5% in their revenues per annum. More than 80% of the top retailers registered an increase in their retail revenue despite most companies experiencing declining total sales.
Now if we only consider the Top 10 retailers as a group against the Top 250 overall, we see figures that emphasize the fact that no wonder these are the Top 10 ! The Top 10 have a much larger geographical footprint than the rest of the industry leaders combined. These retail giants have operations spread out in almost 16 countries. Even with new entrants coming-in into the retail market and consuming a noticeable part of the market share, the Top 10 or as I’ll refer them – The Giants seem to be unaffected and continue to grow and prosper even in this competitive market. These top retailers operate big-box format stores across their network. A big-box format store is typically a physically large retail establishment also so called as a Super-Store or a Mega-Mart.
Now let us look at the list of these “ Top 10 Global Powers of Retailing ” we have been talking about –
The Target Corporation originally known as the Dayton Dry Goods Company is an American Retailing Company. It is the second largest discount retailer in the U.S. just after Walmart. The company features at number 38 in the Fortune 500 list. It has about 1,788 stores operating globally. With its recent expansion into Canada, Target setup more than 100 stores all over the country.
It was built by a banker whose primary source of wealth was farm mortgages. He had no prior experience in retail but held tight control over the company and ran it as an enterprise. The store strictly forbade the sale of alcohol and had a policy of no business on Sundays. Following his strict inhibition for alcohol, the Dayton Company did not advertise in newspapers the sponsored liquor ads. Most of the money that was generated via this enterprise was redirected for a noble charitable cause.
By the 1920’s, the Dayton enterprise had now become a million dollar venture. After the death of Mr. Dayton and his son, the company went into the hands of the cousins that were lower in the family hierarchy. And then the company took a new turn as the new managers gave a different direction to the company. They gave away the earlier policies and started opening on Sundays and the Brand started selling alcohol to promote sales. They favored a more radical, aggressive, innovative, costly, and expansive management style. This began a spree of expansion and Target stores were all over the country and since then there is no stopping them.
Target has a logo that leaves an indelible mark on everyone. It has a Bulls Eye Logo in red color and has had the same since the transition in name from the Dayton Goods Company to Target. It is ranked as the most philanthropic and admired companies.
#9 The Home Depot
The Home Depot is an American Retailer of home improvement and construction products and services. It has its major influences in the United States, Canada, Mexico and China. In terms of revenue it is the largest Home-Improvement retailer worldwide. Also, it has been given the title of the fastest growing retailer in the History of U.S.A. It operates in warehouse style buildings with an average store being 105,000 sq ft. which is almost twice the size of a standard football field. But this still is not the largest that the company operates, company’s largest store is located in New Jersey with a size of 225,000 sq ft.
Home Depot’s has had several slogans since its inception, the first one being “When you’re at Home Depot, You’ll feel right at home”, later came “The Home Depot, Low prices are just the beginning”. But after several slogan changes, the one that has stuck is “More Saving, More Doing”.
With the growth of connectivity via the internet and the growth of e-Commerce as a main stream industry for retail, the traditional bricks-and-mortar retail store is no longer the dominant medium for purchasing goods. Instead, it only serves as one of many ways to connect a retailer’s brand to its customers. Earlier the retailers tried to create enjoyable shopping experiences for customers at their retail stores but with the internet revolution, most retailers had to adopt the aesthetics of the iPad and get a larger share of there resources online. The Home Depot was no different in adopting this approach.They also chose social sharing media to promote its growth. The domain homedepot.com attracts at least 150 million visitors annually. It is also a major promoter of several causes and redirects a huge sum of its funds to Environmental causes, Medical centers, Human Rights Campaigns and also sports.
The Walgreen Company (Walgreens) is the largest drug retailing chain in the United States. The company operates around 8,300 stores only in the U.S. Walgreens provides access to consumer goods and services, plus pharmacy, health and wellness services in America through its retail drugstores. Walgreens has a very good online presence with several online stores namely Beauty.com, Drugstore.com, VisionDirect.com.
The company started off as a single drugstore that was later expanded to a chain of 20 stores. Then the company introduced a malted milkshake, which led to it establishing ice cream manufacturing plants. In a few years down the line they had 397 stores with annual sales of about $4,000,000. But this expansion was majorly attributed to sale of alcohol and whisky which they often stocked under the counter. Walgreens initially started off by acquiring the drug stores in cities and operated in the same manner till it surpassed the $1 billion mark and then they decided to open their first freely standing store and also introduced a very catchy concept that became quite popular – Drive-Through pharmacies. The drug store files about 450 Million prescriptions in the country.
Walgreens as a whole has come to be known as the go-to source for nearly all pharmaceutical needs and they show no signs of slowing down anytime soon. An important aspect of this tremendous growth is their simple logo which has been well recognized by the consumers and whether someone needs a quick snack or a medication refilled, Walgreens is sure to cross their mind.
Aldi Einkauf GmbH & Compagnie also simply known as Aldi is a global discount supermarket chain based in Germany. The chain is made up of two separate groups Aldi Nord also known as Aldi Markt and Aldi Sud. Basically they have divided their operations into North and South and let these two firms operate independently. Aldi is also the owner of the “Trader Joe’s” chain that is operated in the U.S.
Sometimes people say “Aldi is Germany and Germany is Aldi”. Aldi’s founder wasn’t just another entrepreneur. He had his own way of controlling things, despite being ridiculed for selling low quality stuff, he continued with his sense of order, sparse logic of logistics and above all determination. The concept of super cheap groceries wasn’t invented in the U.S., it was rather invented by the Abrechts.
They have their presence in several countries such as Denmark, France, Ireland, UK, Switzerland, Australia and many more. Like most of the others on this list, it started of as a small store which was advertised as the cheapest food source. And now the group operates over 8,000 store worldwide and a store opens roughly every week in Britain alone. Aldi’s specialities include staple items such as food, beverages, toilet paper, sanitary articles and other inexpensive household items. Many of it’s products are own brands, thus leading to greater profits. Also, Aldi is the largest wine retailer in Germany.
Originally these shops were ridiculed for being cheap and selling low quality goods, whose customers could not afford to shop elsewhere. However, being held in low esteem didn’t seem to tint their growth. Also, Aldi has it’s one of a kind mobile virtual network in Germany called Aldi Talk.
Schwarz Pharma was a bio-pharmaceutical company engaged in the discovery, development and marketing of pharmaceutical and biotechnological products. It focused on various therapeutic areas such as central neurology, cardiovascular, central nervous system, asthma etc. As of August 2009, the company was overtaken by UCB SA, Brussels.
UCB is a bio-pharma manufacturer that promotes neuroscience research. UCB is a US$4 billion company that primarily focuses on R&D, specifically involving medications centered around epilepsy and parkinson’s disease.
Costco Wholesale Corporation is a membership-only warehouse club that provides a wide selection of merchandise. It is the second largest retailer in the United States and the fifth largest retailer in the world. Also, it is the largest membership club chain in the world.
Costco has about 626 stores globally with presence in UK, Australia, Canada, Mexico, South Korea, Japan, United States and many more. In the United States, Costco faces tough competition from “Sam’s Club” owned by Walmart. Although Sam’s Club has more Warehouses but Costco has higher total sales volume.
Costco was one of the first companies to grow from 0 to $3 billion mark in just over 5 years. It’s no wonder that it is featured highly on the Fortune 500 list. Over the years, Costco has won the title of the number one in the speciality retail store industry. They focused on selling high volume of products at low price. If the management felt that the wholesale price of a product is too high, they refused to stock the product. For example – The retail giant refused to sell Coca-Cola products when Coca-Cola refused to lower down their Wholesale prices. Later this deal was resumed. Also, they save their money by having a “Customer get your own bag” policy.
The domain Costco.com attracts about 60 Million visitors. Costco has also set foot in Travel and Food industry.
Kroger is an American Retailer which is the country’s largest grocery store chain. It is the second largest general retailer by revenue. It operates a variety of store formats namely supermarkets, superstores, departmental stores, convenience stores and mall jewelry stores. It started of as a grocery store founded by Barney Kroger using his savings.
Kroger was the son of a merchant, and his slogan was simple: “Be particular. Never sell anything you would not want yourself.” Kroger tried many ways to satisfy customers. He tried to make his own products, such as bread, so that customers would not need to go to a separate bakery. Also it’s a one of its kind grocery store that monitors product quality and tests the foods offered to customers.
Tesco is a British Multinational grocery and general merchandise retailer. It is the second largest retailer in the world measured by profits (Just after Walmart). It has its presence in almost 15 countries across Asia, Europe and North America. Just in a few years from its initiation, Tesco was able to expand to a 100 stores across the country with rapid business expansion plans. Since then it has been diversifying geographically and into areas such as books, clothing, furniture, electronics, petrol, software, financial services, telecom, internet services and the list goes on and on. It has more than 6,351 stores till date.
#2 Metro AG
Metro AG otherwise known as the Metro Group is a German retailer and wholesale group. It has the largest market share in its home market, and is one of the most globalised retail and wholesale corporations. It has its international presence all over Europe, Asia and Africa.
In 2012, the company made a bold move by threatening Microsoft with legal action for infringing on “Metro” trademarks held by Metro AG. “Metro” is the same name as Microsoft’s new “Windows 8-style” user interface.
Wal-Mart is the undisputed retail leader in North America and tops the global list of retailers, but the company’s international operations in 15 countries outside the United States generate just under 25 percent of annual sales. Their Slogan “Save Money, Live Better” is very customer friendly. The company is the world’s third largest public corporation, according to the Fortune Global 500 list. The company employs nearly 2 million people and is the biggest private employer worldwide. Wal-Mart has 8,900 stores spanning 15 countries under 55 different names. In India, it operates under the name “Best-Price”.
As Wal-mart grew rapidly into the world’s largest corporation, people started criticizing its impact on local stores, particularly small towns with “mom and pop” type stores. Even studies suggested that such an expansion would lead to shutting down of small town shops and local businesses. This was also one of the primary reasons several economies were initially hesitant in allowing them to open up their stores in their country.
The primary reason why Wal-mart is famous is because of the considerably low prices offered and that is the reason for its huge base of loyal customers. This truly reflects the “Low prices, always” advertising slogan that Wal-Mart started with. An interesting fact is that a survey suggested that the average income of a customer who shops at Wal-mart is much below the calculated national average. And if that’s surprising then the next fact is a shocker, about one-fifth of them lack a bank account.
Interesting Fact – A poll was conducted after the 2004 US Presidential Elections, which revealed that 76% of voters who shopped at Wal-mart atleast once a week had voted for George.W.Bush, while the rest 23% supported John Kerry. This revealed that in comparison to other voters, Wal-mart shoppers were most politically conservative.