Hungary Retail Report Q2 2012

Date: February 11, 2012
Pages: 84
US$ 1,295.00
Report type: Strategic Report
Delivery: E-mail Delivery (PDF), Download

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The Q212 BMI Hungary Retail Report forecasts that the country’s total retail sales will increase by 15% between 2012 and 2016, growing from a predicted HUF6.82trn (US$39.54bn) to HUF7.84trn (US$45.48bn). Rising economic prosperity (despite the financial crisis), easier access to credit and the demand for premium products are the principal factors behind modest retail market expansion, contributing to forecast annual retail sales growth of 3.4% (in local currency terms) over 2012-2016.

The release of Q211 GDP by expenditure data for Hungary shows that most areas of the economy are now displaying pronounced weakness. Given also the deteriorating global macroeconomic backdrop, we have been prompted to lower our real GDP growth forecast for 2011 to 2.0% from 2.9% and highlight that risks to this forecast are firmly to the downside.

The demand for premium products and convenience are the driving factors behind value growth across the Hungarian retail industry, with consumers increasingly regarding their purchases as status symbols. But local consumption patterns vary significantly according to income, with the forecast average wage of US$16,730 in 2011 much lower than professional salaries. The government’s austerity programme, which has reduced consumer expenditure, also means many consumers are extremely price-conscious.

Hungary’s median population age is rising steadily, with the proportion of those aged 20-44 (a key sector for retail sales) in 2010 estimated by the UN Population Division to be 35.6% of the total, up from 35.3% in 2005.

Retail sub-sectors that are likely to grow over the forecast period include consumer electronics. The market offers continued growth potential due to relatively low household penetration rates for digital product groups such as notebook computers (66% CAGR projected) and LCD TVs (21% CAGR). Consumer electronics sales are forecast to rise from an expected US$2.46bn in 2012 to US$3.03bn by 2016, an increase of more than 23%.

Over the counter (OTC) pharmaceuticals are forecast to expand by nearly 12% from US$0.49bn in 2012 to US$0.55bn in 2016.

BMI’s food consumption data suggest the food retail segment will have a market share of 52.8% in 2012. The sub-sector is forecast to be worth US$20.89bn in 2012, and sales are expected to grow by 28.3% to US$26.80bn by 2016, when the market share will be 58.9%.

Mass grocery retail (MGR) sales are forecast to reach US$16.11bn in 2012 and to grow faster than overall food sales throughout the forecast period to US$19.46bn by 2016. This would take MGR’s share of the overall food market from 66.6% in 2012 to 71.1% by the end of the forecast period. Changing consumer habits and increasing use of cars suggest that modern MGR outlets will continue to expand their market share.

Retail sales for the BMI universe of CEE countries in 2012 are forecast to amount to US$1,342bn based on the varying national definitions. Total consumer spending for the region based on BMI’s macroeconomic database is expected to be US$2,172bn. Russia, Turkey and Poland are predicted to account for an estimated 79% of regional retail sales in 2012, falling slightly to 78% by 2016. Hungary’s forecast market share of 2.9% in 2012 is expected to fall to 2.8% by the end of the forecast period.
Executive Summary
SWOT Analysis
Hungary Retail Business Environment SWOT
Hungary Political SWOT
Hungary Economic SWOT
Market Overview
Current Trends
Key Players
Industry Forecast Scenario
Consumer Outlook
Retail Growth Outlook
  Table: Hungary’s Retail Indicators, 2010-2016
  Table: Retail Sales By Segment, 2012f
Macroeconomic Outlook
  Table: Hungary – Economic Activity
Regional Retail Outlook
  Table: Regional Retail Trends, 2010-2016
  Table: Regional Retail Sales, 2010-2016 (US$bn)
  Table: Countries By Percentage Share of Regional Retail Sales, 2010-2016
Regional Retail Trends
Business Environment Outlook
Hungary’s Retail Rating
Limits To Potential Returns
Risks To Realisation Of Returns
Mass Grocery Retail
Hungary Mass Grocery Retail Industry SWOT
Market Overview
Leading Retailers
  Table: Hungary – Structure Of The Mass Retail Grocery Market By Number Of Outlets
  Table: Hungary – Structure Of The MGR Market By Value
  Table: Hungary Value Of Sales Per Outlet 2011
Industry Forecast Scenario
  Table: Hungary Mass Grocery Retail – Value Sales By Format – Historical Data & Forecasts
  Table: Grocery Retail Sales By Format – Historical Data and Forecasts
Industry Developments
Consumer Electronics
Hungary Consumer Electronics Market SWOT
Market Overview
  Table: PC Sales
AV Devices
  Table: AV Sales
Mobile Handsets
  Table: Mobile Communications
Industry Forecast Scenario
Consumer Electronics Market
  Table: Consumer Electronics Overview
Industry Developments
Hungary Autos Industry SWOT
Market Overview
  Table: Hungary – Top 10 Best-Selling Models 2010
Fresh Investment
Industry News
Industry Forecast Scenario
  Table: Hungary Autos Production
  Table: Hungary Autos Sales
  Table: Hungary Autos Trade
BMI Methodology
How We Generate Our Industry Forecasts
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