Concentration of Retail in Austria

For many years, Austria has been a country with a very high degree of concentration in the retail market. Compared to other countries, the degrees of concentration in the food and drugstore/perfumery sectors are particularly notable. The reasons for this are twofold: on the one hand, Austria is a small country, so retailers are able to quickly establish nationwide outlet networks. On the other hand, the country is culturally and geographically close to the German market, which has helped German corporations become market leaders or at least be one of the big players in most retail sectors in Austria.
Viewed over a longer period, one can observe that contrary to common expectations, retail concentration has not been rising in all cases, and there large sector-specific differences. While the degree of concentration is continuing to increase strongly in food retail, drugstore/perfumery, and furniture, it is stagnating in the apparel, electronics, and sporting goods sectors. Retail concentration is even decreasing in DIY and footwear, which is mostly attributable to the decline of some previously dominant market players.
If current developments in the respective sectors are taken into account (e.g. the bankruptcies of Baumax and Zielpunkt) and the expansion plans of companies are considered, then concentration is expected to increase in the coming years, particularly in food retail (continuing expansion of the market leaders) and DIY (Obi’s takeover of Baumax).
The online market is having a curbing effect on all sectors: The number of pure internet companies (pure players) such as Amazon, Zalando, etc. has increased such that some markets now have additional new market players beyond brick-and-mortar, which considerably decreases the degree of market concentration. Currently this is the case especially in the electronics, apparel, and footwear sectors.


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