Retail Facts Finland 2020 Join us! OPPORTUNITIES FOR INTERNATIONAL RETAILERS A stable, Why Finland? transparent and well-performing Nordic country Population The presence grows rapidly in of international retailers has been the largest cities, FINLAND OVERVIEW especially in steadily growing 3 Helsinki *The in Finland happiest 8 THE FINNISH RETAIL MARKET country 15 HELSINKI METROPOLITAN AREA in the world third year in a row Growing 24 TAMPERE shopping centre Retail market is growing market, high quality 28 TURKU opportunities for faster than the retail brands Eurozone 32 ESTABLISHMENT FACTS Wealthy consumers with purchasing power 33 CONTACT INFORMATION among the top 10 in EU *Sustainable Development Solutions Network, World Happiness Report 2020 Cover photo: Oodi / Tuomas Uusheimo Chapter 1 Finland overview Photo: The Night of Arts, Senate Square / Julia Kivelä Well-performing stable Nordic country A member of the European Union and the only Nordic country in the Eurozone The Nordic region continues to outperform the rest of Europe in rankings. All Nordic countries are ranked in the top 10 best countries in the world for doing business and the region’s residents are among the happiest and the wealthiest. €9,700 RETAIL AND F&B SALES KEY FACTS FINLAND PER CAPITA 2019 Population 2019 5.5 million GDP per capita 2019 EUR 43,484 FINLAND GDP growth 2019 1,00 % Tampere Ination 2019 1.02 % SWEDEN NORWAY Unemployment rate (March 2020) 7.30 % RUSSIA Turku Disposable income per capita 2018 EUR 23,900 Oslo Helsinki Retail sales 2018 (VAT 0%) EUR 39,400 million 3h 30min Retail sales growth 2019 2.20 % Stockholm F&B sales 2018 (VAT 0%) EUR 5,600 million 2h St. Petersburg F&B sales growth 2019 5.1 0% Tallinn Retail and F&B sales per capita 2018 (incl. VAT) EUR 9,700 ESTONIA Corporate tax rate 20 % Source: Statistics Finland DENMARK Copenhagen FInland overview // 4 Finland’s economy has made it through the COVID-19 pandemic relatively unscathed Finland’s economy has made it through the average, EU countries’ GDP plunged by 14 Q2 2020: GDP change from previous year, % pandemic relatively unscathed compared percent. to other EU countries. Finland did better at Before COVID-19, Finland’s GDP grew Spain -22 controlling the spread of the illness. Much for several years in a row. In 2019 the econ- UK -22 of the labour force transitioned smoothly to omy grew by 1.0 %. Finland’s GDP per working remotely, thanks to solid digital capita was 9.2 % above the EU average. France -19 skills and infrastructure. Also Finnish spending potential Italy -18 Based on Eurostat gures, Finland's exceeds the EU average. Finland is among Portugal -16 economy fared the second best of any in the top 10 EU-countries based on purchas- Malta -15 the EU last spring. Finland's seasonally ing power per capita (2018). Euro area -15 (19 countries) adjusted GDP plunged by 6.3 percent Sources: Eurostat Belgium -14 year-on-year in the second quarter. On EU -14 (28 countries) Hungary -14 Slovenia -13 TOP 10 COUNTRIES IN EU, 2018 Austria -13 DISPOSABLE INCOME PER CAPITA IN PPS, EU Cyprus -12 Germany -11 Luxembourg 33,332 Czechia -11 Germany 29,258 -11 Austria 27,374 Romania Belgium 25,911 Netherlands -9.2 Netherlands 25,648 Latvia -8.6 France 25,358 Denmark -8.2 Denmark 24,997 -7.9 24,918 Poland S Finland S o o u Sweden 24,661 u Sweden -7.7 r r c c e: Euro area e: 24,251 Estonia -6.5 E (19 countries) E u u r European Union 22,828 r o o -6.3 s (28 countries) s Finland t t a 22,421 a t Italy t Lithuania -4 0 -5 -10 -15 -20 FInland overview // 5 Population grows rapidly especially in Helsinki Finland has three city regions with more than 300,000 inhabitants. Almost 42 % of the population lives in these three regions and the share is set to increase thanks to a growing population and continuous urbanization. FINLAND'S LARGEST CITY REGIONS Population 2019 Forecasted 5-year population growth 1 Helsinki region 1,572,161 5.3 % 2 Tampere region 410,689 4.1 % 3 Turku region 332,288 2.8 % 4 Oulu region 252,559 3.5 % 5 Lahti region 199,604 -1.5 % Oulu 6 Jyväskylä region 186,252 2.9 % 4 7 Kuopio region 140,705 1.3 % 8 Pori region 131,368 -3.4 % 9 Seinäjoki region 126,732 -0.4 % 10 Joensuu region 124,152 -0.6 % Seinäjoki Kuopio Source: Statistics Finland Joensuu 9 7 TAMPERE Jyväskylä 10 6 Pori 2 8 Lahti TURKU 42% 5.3% 5 LIVES IN 5YEAR GROWTH 3 1 THE THREE LARGEST IN HELSINKI REGION REGIONS HELSINKI FInland overview // 6 Top performer in international rankings Finland retains its good position in many international This illustrates Finland’s reputation as a respected Nordic rankings regarding the competitiveness of the economy where stability, transparency, high-quality economy or the overall welfare of its citizens. education and healthcare support business and living. 1st 3rd The best country in The third most tolerant institutions and nation in the world macroeconomic stability st nd rd Legatum Institute th World Economic Forum, The Foundation, The Legatum 4 1 Global Competitiveness 2 3 Prosperity Index 2019 The third best AA+ credit ratings Report 2019 The second-best The fourth best country country for gender from all major global country in skills for business in Europe equality in the world rating agencies World Economic Forum, The European Chamber, Best Fitch, Moody’s, Global Competitiveness World Economic Forum, European countries for Standard&Poor’s Report 2019 The Global Gender Gap business 2019 Report 2020 1st 1st 11th 7th The most stable Top Nordic country in a 11th most competitive 7th best business country in the world number of foreign direct economy in the world environment in the world for 10 years in a row investment projects st Word Economic Forum, The th World Economic Forum, The The Fund for Peace, Fragile 1 EY’s Nordics Attractiveness Global Competitiveness Travel & Tourism States Index 2020 Survey 2019 Report 2019 7 Competitiveness The happiest 7th best English skills Report 2019 country in the world among the adults in the Sustainable Development world Solutions Network, World Happiness Report 2020 Education First (EF), English Proficiency Index Helsinki Sauna Day / Helsinki Marketing / Eetu Ahanen / Eetu / Helsinki Marketing Helsinki Sauna Day Photo: Chapter 2 The Finnish retail market Uhana / Finnish Design / Laura Vanzo Uhana / Finnish Design Laura Photo: Retail consumption is over 15% higher than that of the Eurozone Finnish retail sales increased by 2.2 % in Finns spend a large share of their 2019. The food & beverage sector has income on retail and leisure activities.Retail accounts for 34 % of total household TOP 10 COUNTRIES IN EU been growing fast almost the whole CONSUMPTION EXPENDITURE PER CAPITA 2018, EUR decade, by 5.1 % in 2019. The retail market expenditure. Adding food & beverage and has been growing faster than the Euro- leisure services, the share is approx. 40 % - 5 450 zone on average. EUR 8,900 per capita. 5 690 1 870 19 850 Luxembourg 32 860 Finnish retail consumption per capita Sources: Eurostat, Statistics Finland 5 390 5 880 3 350 18 080 is slightly higher than in Sweden and on Iceland 32 700 the 6th place in the EU. 3 560 4 960 1 260 14 110 Denmark 23 890 2 540 5 080 1 750 13 440 UK 22 810 2 930 5 110 2 430 12 100 Austria 22 570 3 460 4 150 1 310 12 440 Finland 21 360 RETAIL, F&B AND GDP DEVELOPMENT 2011-2019 2 720 2 960 2 880 11 470 Ireland 20 030 % 2 790 4 440 860 11 920 Germany 20 010 8.6 3 200 4 350 1 220 11 210 Sweden 19 980 6.4 3 290 3 880 1 130 11 480 4.8 5.0 5.1 Belgium 19 780 4.4 4.3 4.1 3.6 3.1 2 920 3 490 1 290 10 220 2.7 2.6 2.8 2.5 2.2 Eurozone 17 920 1.6 1.6 (19 countries) 1.3 1.0 2 690 3 360 1 170 9 580 0.5 -1.4 0.2 -0.9 -1.0 -0.4 -0.8 0.0 EU 16 800 (28 countries) 2011 2012 2013 2014 2015 2016 2017 2018 2019 Retail sales F&B sales GDP growth Source: Statistics Finland Groceries Specialty retail Restaurants Other Source: Eurostat The Finnish retail market // 9 RETAIL SALES PER SEGMENT (VAT 0) FOOD AND BEVERAGE SALES PER SEGMENT (VAT 0) +2.2% in 2019 +5.1 % in 2019 Fashion & Other Food kiosks Catering accessories Bars & night clubs % % 5% %2 2 % 2 Furnishing & 4 Cafes 4% home decor 5% Leisure % & sport 5 Canteens 17 Restaurants % Electronics 5% Groceries 44 % 51 40 % 5.9 8% EUR billion EUR billion Hardware 2018 2018 & construction 8% Health & beauty 28 Fast-food % 10 Department restaurants % stores Source: Statistics Finland Source: Statistics Finland ONLINE RETAIL GOODS (VAT 0) +12 % in 2019 Books & other Other entertainment % Health & 3% 3 beauty 4% Electronics Furnishing & home decor 9% 30 % 11 % Sports & 4.5 equipment EUR billion 2019 12 % Hardware & construction, pets Fashion & 28 footwear % Source: Finnish Commerce Federation / Kantar TNS Sello shopping centre, Espoo Sello shopping centre, Photo: Opportunities for international retailers Scandinavian chains dominate the fashion and S Group, but German Lidl has increased its Photo: Ainoa shopping centre and sports market. Largest companies are market share. Swedish H&M and Stadium, Norwegian The presence of international retailers in Varner Group and XXL and Danish Best- Finland has steadily grown in recent years.