Out of retailers surveyed, 51 per cent said they were more likely to acquire space in an own-store format when expanding their presence in the Europe, Middle East and Africa (EMEA) region. This preference is particularly notable among retailers entering Western European and more mature markets such as Germany, Spain, France and the UK, according to the report.

Despite this shift towards owner-operated store formats, CBRE found that retailers pursuing a franchise model tend to be the more expansive. Of those surveyed, 40 per cent were looking to acquire more than 20 stores in 2010, while 34 per cent are likely to acquire more than 30 stores. In addition, the results showed that the grocery and food and beverage sector was more likely to franchise with 72 per cent opting for this route. In comparison 88 per cent of luxury fashion retailers who own their own stores were unlikely to opt for the franchise model.

CBRE’s research, How Active are Retailers in EMEA?, examines the attitudes and expansion plans of 220 leading retailers. Peter Gold, Head of EMEA Cross Border Retail, CB Richard Ellis, said that franchising is now more important for retailers targeting mature markets as well as emerging markets. “However, in some cases the failure of previous franchise operations is forcing leading retailers to review their existing strategies. A number of major global brands have faced difficult decisions when confronted by a struggling franchisee – do they allow their partners to fail, with consequent impact on the brand, or do they finance them to buy them out directly, which can entail an increase in risk and resource commitment? Some retailers are also hesitant to enter a market without 100% ownership, as they want to maintain full brand control.”

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