Retailers should definitely take a closer look at Finland. For some reason, this interesting market is usually ignored or forgotten about. The Finnish people are well educated, have high disposable income and are tired of a never changing retail landscape. The upside is of course the many opportunities you will find if you just scratch the surface.
The market is still undeveloped and the competition is not deadly. Having said that, it does not mean that things are not happening. During the last two years some major actions has been taken, especially in Helsinki. For instance, Finland’s largest department store Stockmann has become bigger and better, the luxury galleria Kämp has made some radical rearrangements and galleria Kluuvi has gone from a no name to a respected competitor in the dense Helsinki shopping scene. When things like this happens you want to be there. New innovative concepts are welcomed with open arms and new playing rules are written. The race is not over and this will naturally grow the demand for change also outside the metropolitan area. There are far too many shopping malls with identical offer. This has to change!
If we instead talk about competition, we have to consider the Swedish brands. Companies like H&M, Clas Ohlson (home appliance), Nilson Group (shoes), Stadium (sports), Gina Tricot (fashion), Kicks (cosmetics) and Indiska (fashion and interior decorating), just to mention a few, are all contributing to the Swedish domination. There are also strong Finnish brands to keep an eye on. You can for instance find strong concepts in the home deco sector, such as Marimekko, Iittala and Pentik.
But even in this segment there are openings. The lack of strong lower price inner city chain becomes obvious if you take a down town tour in Helsinki, Espoo, Turku and Tampere, the four largest cities in Finland. Another need is innovative and healthy fast-food concepts and cafes. The existing chains have been operating far too long without strong competition. Good discounters and factory outlets are also things the Finnish people would like to hear and see more of.
Another very interesting aspect with Finland is the growing tourism from Russia. The demand for luxury goods has increased and the main reason for a Louis Vuitton flagship store in central Helsinki is definitely not Finnish consumers. This leads us to a finding you definitely will get if you study the Finnish market closer. Why are Finnish retailers not established in western European countries? Well, some are, for instance Marimekko and Iittala, but the list does not get much longer. The simple answer is that the Finnish retailers have instead looked eastwards. Two companies that have long experience in operating in these countries are Stockmann (dept. store) and Seppälä (the Finnish version of H&M). Therefore, the idea of having Finland as an entry platform for expansion in the Baltics and Russia could be a good strategy.
If we add words and sentences such as “a safe business environment”, “the best country in the world according to Newsweek” and “the most livable city in the world is Helsinki according to Monocle 2011″, it becomes clear that Finland should be on your map if you are looking for a Nordic expansion. Finally, the Finns are open to new technology and easily adapt to new innovative concepts and trends. E-commerce is growing and the IT-infrastructure is excellent.
Written by Magnus H - Diamon Expert