Understanding Failure in International Retailing: An Institutional Framework for Future Investigation

Abstract

Retailing is rapidly becoming a global industry, and many of the world’s well-known retailers already derive a large part of their sales from international operations. The last two decades have witnessed increase in retail foreign direct investment (FDI) into a range of emerging markets across East Asia, Central and Eastern Europe and Latin America. A small group of food and general merchandise retailers from Western Europe, and to a lesser extent, North America have led the way (Coe and Wrigley, 2007: 341). On average, the top 250 retailers operated in 6.8 countries in 2007 up from 6.2 countries in 2006 and 5.9 in 2005 (Deloitte, 2009). In total, 21.3 per cent of sales came from outside retailers’ home countries (Deloitte, 2009). The average Top 250 European retailers had a presence in 14.9 countries in 2010, up from 11.1 countries in 2007, and over 40 per cent of their total sales were from foreign operation in 2010, up from 35.1 per cent in 2009 (Deloitte, 2012). French and German retailers are the most international in scope (Deloitte, 2012). The estimated global retail sale for the Top 250 retailers in 2010 was US$ 3.94 trillion (Deloitte, 2012).