PRODUCT-LINE PURCHASING POWER Retail potential for food, clothing, consumer electron-ics and watches & jewelry in Belgium, Croatia, Italy and Poland

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date:

data source:

June 2018

GfK study on 2017 product purchasing power in Belgium, Croatia, Italy and Poland

GfK Purchasing Power for International Retail Product Lines (June 2018) 2

Belgium, Croatia, Italy and Poland: Four very diverse European retail markets

With 60 million inhabitants, Italy is in the forefront when it comes to population size. Second place goes to Poland with 38 million inhabitants, followed by Bel-gium with 11 million and Croatia with four million.

In line with its larger population, Italy has the most re-tail purchasing power at €285.8 bil. Retail purchasing power refers to the amount of the population's net in-come available for brick-and-mortar retail purchases in a given year. Belgians’ incomes are far above the European average, resulting in a total retail purchas-ing power of €81.9 bil. This sum comes close to Po-land’s retail purchasing power (€93.3 bil.), even though Poland has almost 3.5 times the inhabitants of Belgium. This reflects the enduring unequal distribu-tion of wealth across Europe. Due to its comparatively low number of inhabitants, Croatia has a retail pur-chasing power of €13.8 bil., although the country’s av-erage per capita income is somewhat higher than Po-land’s.

Comparing per capita values and retail purchasing power’s share of general purchasing power is also insightful. With 47%, Croatia has the highest percentage of general purchasing power for retail purchases. This equates to an average of €3,278 per person. The share in Belgium is 38%, which amounts to an average of €7,232 per person. With a retail share of 36%, Poles have a per capita re-tail purchasing power of €2,427. Although Italy has more purchasing power, its retail share is only 28%, which corresponds to €4,716 per person.

81.9

13.8

285.8

93.3

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50.0

100.0

150.0

200.0

250.0

300.0

350.0

Belgium Croatia Italy Poland

Retail purchasing power in bil. EUR

7,232

3,278

4,716

2,427

19,198

6,969

17,119

6,710

0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 16,000 18,000 20,000

Belgium

Croatia

Italy

Poland

General and retail purchasing power per inhabitant in EUR

28

47

36

38

GfK Purchasing Power for International Retail Product Lines (June 2018) 3

Belgium

With a per capita purchasing power of €19,198, Belgium has around 37% more purchasing power than the European average, putting it in fourteenth place.

Retail purchasing power in Belgium comprises 38% of its general purchasing power, which is an un-typically high proportion for a country with high purchasing power. This is because the retail share usually decreases as general purchasing power increases, leaving more funds available for other types of spending, such as recreation and services, or for saving.

The share of purchasing power available for food is higher in Belgium than in other countries with high purchasing power: Belgians have almost 45% of their retail purchasing power available for food purchases. Nearly one-tenth (9.8%) is available for clothing, while 4.7% is devoted to consumer electronics and 1.1% to watches and jewelry.

The regional distribution of product-line potential in Belgium is relatively balanced across all product

10044.9

9.84.7

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0 10 20 30 40 50 60 70 80 90 100

retail purchasing powerfood

clothingCE

watches, jewelry

Share as a % CE = consumer electronics, ICT and photo

low high average

Purchasing power index per inhab.

GfK Purchasing Power for International Retail Product Lines (June 2018) 4

groups. But with respect to clothing and consumer electronics, there is a dividing line between the somewhat more affluent region of Flanders in the north and the less affluent region of Wallonia in the south.

Interestingly, the capital district of Brussels is somewhat below average in terms of retail potential for clothing and watches & jewelry. But on the whole, the larger capital province of Brussels is an above-average area, with the greatest wealth concentrated in a belt around the capital region. The province of East Flanders also has above-average values for all of the product lines considered above.

Croatia

Croatia comes in at twenty-eighth place in the 2017 European purchasing power rankings, just ahead of Poland. Croatians have around half of the European per capita average at their disposal.

At €3,278, Croatia’s per capita retail purchasing power is very high: Around 47% of the country’s general purchasing power is available for retail purchases.

Almost half of this goes to food product lines, while approximately 10.5% goes to clothing. Con-sumer electronics has a share of 2.7%, with watches and jewelry coming in at 1.5%.

10049.0

10.52.7

1.5

0 10 20 30 40 50 60 70 80 90 100

retail purchasing powerfood

clothingCE

watches, jewelry

Share as a % CE = consumer electronics, ICT and photo

low high average

Purchasing power index per inhab.

GfK Purchasing Power for International Retail Product Lines (June 2018) 5

Product-line potential is distributed very unevenly across Croatia. The Dalmatian coast does particu-larly well in terms of food product lines. Clothing is also strong in this area, which is also the case for Karlovac and the capital city Zagreb. Potential for consumer electronics is even more above average in these two cities, while the eastern part of the country trails behind, with the exception of Osijek.

Potential for watches and jewelry is even more polarized, with values ranging from 30% above the national average to 30% below. Urban regions significantly surpass rural ones.

Italy

When it comes to general purchasing power, Italy is ranked sixteenth in Europe, just after the Neth-erlands. With a per capita purchasing power of €17,119, Italians have almost 23% more than the Eu-ropean average. But at 28%, retail’s share of general purchasing power is lower than in any of the other considered countries.

Italians’ passion for food is apparent in the high share of retail purchasing power devoted to this product group (44.6% or €2,104 per person). The share available for clothing is also very high at 13.2%. The figure is 10-11% for the other covered countries. Consumer electronics has a share of just 3%, while watches and jewelry comprise 2.2%.

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13.23.02.2

0 10 20 30 40 50 60 70 80 90 100

retail purchasing powerfood

clothingCE

watches, jewelry

Share as a %

GfK Purchasing Power for International Retail Product Lines (June 2018) 6

The north-south divide is also apparent in Italy’s potential for product lines. Among those considered here, the potential for food purchases is most evenly distributed. Watches and jewelry are the least evenly distributed. Regions in the north reach values 20-30% above the national average, while the opposite is true of Sicily in the south, with values up to 30% below the national average.

low high average

Purchasing power index per inhab.

GfK Purchasing Power for International Retail Product Lines (June 2018) 7

Poland

Poland places twenty-ninth in the 2017 European purchasing power rankings. With €2,427 per per-son, Poland’s retail purchasing power comprises around 36% of the country’s general purchasing power.

Approximately €1,046 per person or around 43.1% of this goes to food product lines. Clothing’s share of Poland’s per capita retail purchasing power is around 11.2%. At €123 per person, consum-er electronics’ share is just 5.1%, while watches and jewelry comprise an even lower proportion at €36 per person or 1.5%.

As the maps illustrate, Poland’s purchasing power varies widely according to product line. As ex-pected, potential for food product lines is relatively evenly distributed, as food purchases are a basic

10043.1

11.25.1

1.5

0 10 20 30 40 50 60 70 80 90 100

retail purchasing powerfood

clothingCE

watches, jewelry

Share as a %

low high average

Purchasing power index per inhab.

GfK Purchasing Power for International Retail Product Lines (June 2018) 8

need irrespective of a region’s overall wealth. There is a clear hotspot for clothing around Warsaw, but second-tier cities also have significantly above-average potential for this product line. Potential for consumer electronics is strongly polarized across Poland’s regions: The north and southeast lie significantly below the national average. This is also true for the region around Posen (but not the city itself and its immediate surroundings). Potential for watches and jewelry peaks along a corridor in the middle of the country as well as in several cities in close proximity to borders and coasts.

Overview: Per capita product-line purchasing power & product-line share

7,23

2

3,24

7

712

336

82

3,27

8

1,60

5

343

89 49

4,71

6

2,10

4

622

140

103

2,42

7

1,04

6

271

123

36

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

retail purchasingpower

food clothing CE watches/jewelry

Product-line purchasing powerin € per inhab.

Belgium Croatia Italy Poland CE = consumer electronics, ICT and h t

GfK Purchasing Power for International Retail Product Lines (June 2018) 9

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44.9

9.8

4.7

1.1

49.0

10.5

2.7

1.5

44.6

13.2

3.0

2.2

43.1

11.2

5.1

1.5

0.0 10.0 20.0 30.0 40.0 50.0 60.0

food

clothing

CE

watches/jewelry

Product-line shares as a %

Poland Italy Croatia Belgium CE = consumer electronics, ICT and photo