Decoding the secret Success of Austria’s Retail Market
Well, that was exactly what a lot of international high quality retailers also thought in the recent years and which made Austria one of the top and most sought after retail locations within Europe. Needless to say, Vienna, the capital city of Austria, made its way into the top 10 of the most important retail locations in the world for the first time in 2013.
What you should know about Austria:
In the centre of Europe, ideally located between the Western and Eastern countries, Austria has proved to be a very stable and promising economy. Its retail market is strongly influenced by the country´s high concentration of shopping centres. All together there are currently about 210 shopping centres and retail parks, which comprise an overall GLA of about 3.5 million sqm. Admittedly, the top spots for potential investors and market entries are rare as the demand consistently exceeds the supply. However, the Austrian retail market in the bigger inner cities of the country is considerable strong and attractive for every new investor.
New Retailers and Brands everywhere
Even in rough times of multichannel retailing, the Austrian retail market still scores significant growth of retail spaces and several international retail chains have just successfully edged their way onto the Austrian market:
- 7 for all mankind
- Miu Miu
- Scotch & Soda
- Stefano Ricci
- True Religion
- Vivienne Westwood
Millions of consumers, not only domestic inhabitants, but also "shopping tourists" with unbelievable purchasing power, contribute to a secure and stable retail market year after year. Already in 2012, the stable consumer demand resulted in retail sales achieving a nominal growth of 1.1% and total sales amounted to EUR 52.8 billion (net, in preliminary value!). These remarkably high numbers will even further increase, according to the Austrian Institute of Economic Research. It thus comes not as a surprise that the Austrian retail market constantly attracts new brands to expand their business to Austria.
A great Opportunity
When it comes to very promising fashion retail concepts, plus size clothing as well as men’s and children´s fashion is a hot topic, as demand is growing rapidly and consumers are still missing an adequate supply in Austria. Regarding other retail sectors, the food sector is unsurprisingly continuing to grow while the Austrians are increasingly spending more money on eating out. Especially fast food restaurants, which are bringing new healthier options into the market, are profiting from this trend.
An Environment to prosper
Talking in numbers, the average turnover of Austrian top 15 centres is about EUR 5,500 per sqm per year, whereas the best of those manage to even hit the EUR 10,000 benchmark with ease. The net rents range from about EUR 10 to EUR 80 per sqm per month in shopping centres, and EUR 20 in less frequented streets up to EUR 340 per sqm in Austria´s top high-street locations. With this prosperous environment the Austrian retail market offers, it becomes clear that Austria should be on your map if you are looking for a successful, central-European expansion!
To finally convince the last skeptics, we can provide this highly promising last quote from the latest Austrian Retail Market report: "Nine out of ten investors defined the Austrian market as attractive".
Written by Hannes Pachler, Diamon Expert Austria