Migros and Coop remain among the world's 50 largest retailers

The world's 250 largest retailers generated revenue of USD 4.53 trillion in the 2017 financial year, which corresponds to growth of 5.7 percent overall. In the "Global Powers of Retailing" report, Deloitte identifies the world's 250 largest retailers based on publicly available data from the 2017 financial year (financial years ending June 2018). 

The global economy enjoyed strong growth until the beginning of 2018. But recently, inflation has picked up in key markets, a number of governments are changing their monetary and fiscal policies, and currencies in various emerging markets are falling significantly, meaning that the global economy could cool down in the near future. For retailers, this means slower growth in consumer spending, higher consumer prices and a disruption of global supply chains. 

In Switzerland, the outlook is more promising, says Konstantin von Radowitz, Managing Partner Consumer and Industrial Products at Deloitte Switzerland. "2018 was a decent year for the Swiss retail sector compared to other countries," says von Radowitz. "Sales in the Swiss retail sector increased by an estimated 0.4% thanks to the healthy economic environment in Switzerland. Despite global uncertainty, the overall outlook for the Swiss economy in 2019 is good. Private consumption is also expected to remain stable."

Little has changed among the world's ten largest retailers

In the 2017 financial year, the ten largest retailers were responsible for almost a third (31.6%) of the total turnover of the top 250 companies worldwide. The three largest retailers, US-based Wal-Mart, Costco and The Kroger, defended their positions. Amazon continues to grow and moved up to fourth place, thanks in part to the acquisition of Whole Foods. Over the past five financial years, the company has moved up eleven places.

With growth of 6.1%, the ten largest retailers performed slightly better than the 250 largest retailers as a whole, which grew by 5.7%. However, the net return on sales for the top 10 was weaker than in the previous year and also weaker than for the 250 largest retailers. This is largely due to the fact that eight of the ten largest retailers operate in a sector where products are sold quickly and are relatively inexpensive. Margins are coming under pressure here because costs are rising, because pricing power is decreasing due to increasing competition and transparency and because investments need to be made in the digital transformation of the business. 

Migros and Coop remain in the top 50

Migros and Coop are at the top of the Swiss retail market, and both maintained their strong positions in the Top 250 ranking: Migros (with retail sales of USD 24.5 billion in the 2017 financial year) reached 39th place and Coop (USD 22.5 billion) 44th place. Richemont, the Geneva-based holding company for luxury goods, moved up nine places to 129th place, while duty-free group Dufry continued its growth trajectory and took 123rd place. Dufry is one of the fastest-growing retailers in the world over the past five years (annual growth rate of 21.7%). 

"It is impressive that Migros and Coop are keeping pace with the growth of the global retail trade, while the Swiss market offers only limited opportunities for growth. Switzerland is a small country and there are only small economies of scale in the stationary retail trade. In addition, consumers from Switzerland are still flocking across the border to shop there, even if cross-border shopping has become less attractive for Swiss shoppers in terms of price," says Konstantin von Radowitz. 

He adds: "E-commerce has not yet had a significant impact on the Swiss retail trade. Internet sales continue to grow, but their share of the overall retail business is still low: in 2018, online sales accounted for less than 10 percent of total retail sales in Switzerland. On the other hand, there are more and more foreign players such as Amazon, Zalando and AliExpress, which continue to grow strongly in the Swiss market. Swiss retailers must therefore continue to invest in their online business."