Report from MAPIC 2015: US Expansion Still Hot Topic

The Goulston & Storrs’ MAPIC team has returned from the 21st annual MAPIC (le marché international professionnel de l’implantation commerciale et de la distribution) conference in Cannes, France.  From November 16-18, MAPIC hosted its international retail conference at the Palais de Festivals et des Congrès in Cannes. Approximately 8,000 international attendees, including over 2,000 retailers, from 74 countries participated in 3 days of exhibition, conferences and networking events. MAPIC reported that 470 new brands participated this year and over 700 companies exhibited at the conference.  Determined to stand strong in the face of the terrorist events which transpired in Paris only days before the conference, attendees arrived in Cannes with a sense of resolve and resiliency.  This year marked the 5th year that G&S has attended MAPIC.

It was a particularly important year for the G&S MAPIC team because the United States was the “Country of Honor” at the conference.  Each year, MAPIC designates one country as the featured nation and highlights the country’s retail accomplishments and developments through forums and panel discussions and an exhibition area.  This year’s U.S. focus provided the G&S MAPIC team with even more opportunities to share their expertise and insight with international retailers looking to expand into the United States.

Although we sensed more optimism about the European economy than in prior years, expansion into the U.S. still appears to be a significant goal of many international retailers. A few of the topics discussed with these retailers included the U.S. litigation climate and outlook, and its impact on retail expansion; the breadth of initial expansion; potential partnerships with U.S. operating partners; and the selection of retail consultants and real estate brokers.

The most active debates, however, focused on locational and timing considerations, such as where and when to expand into the U.S.  Although many international retailers initially believe that they need to open their first U.S. store in Manhattan or Los Angeles despite the high costs, others look to established malls throughout the U.S. as a less expensive entry point.  Factors, other than costs, which impact these decisions include the location of customers (urban or suburban), the price point of customers, and the retailer’s overall motivation for expansion (to grow revenue or heighten brand awareness, or both).  Although these factors are not new, each year at MAPIC we learn varying perspectives from international retailers and enjoy lively discussions about the different strategy for entering the U.S. market.

As always, we have our pulse on these issues and will report back in future Retail Law Advisor posts.

Related topics: Retail