How to Grow Successfully in Emerging Retail Markets with Openbravo October 27th, Openbravo Inc. All Rights Reserved. 1

Simple steps to increase the value of today s webinar experience Today s presentation is available to download on the Attachment tab on the webinar page. Visit openbravo.com/retailers/resources/overview/ Check out additional resources and don t forget to share them with your colleagues. Have a question? Click on the Question tab. Q&A will be at the end of today s presentation. Submit additional questions or comments after the webinar on Twitter. Hashtag: #webinar_ob 2016 Openbravo Inc. All Rights Reserved. 3

Go for Growth in Emerging Markets $1.490 Retail Sales Per Capita $525 2000 2015 More than half of retail spending in the world now comes from consumers in emerging markets. Source: Credit Suisse 2016 Openbravo Inc. All Rights Reserved. 7

Emerging Markets Outpace Developed Markets 2000-2008 2009-2012 2013-2015 Emerging Markets 11.4% 11.7% 0.0% Developed Markets 5.7% 4.0% -2.7% Total 7.8% 7.4% -1.3% Emerging Developed Retail Sales in Emerging and Developed Markets (USD trillion) Source: AT Kearny 2016 Openbravo Inc. All Rights Reserved. 8

Initial Focus on Luxury Consumer No. millionaires % of population China 1.3m 0.1% India 185,000 0.0% Brazil 168,000 0.1% Mexico 122,000 0.2% Source: Credit Suisse 2016 Openbravo Inc. All Rights Reserved. 9

Rising Expectations Expanding middle class + Increased purchasing power What is the impact on retailers? Expanded assortments Higher margins Increased spending on durables Increased spending on apparel 2016 Openbravo Inc. All Rights Reserved. 11

Lessons Learned Mind the gap Watch out for gaps in the supply and value chain, such as logistics or personnel. Price is still king Consumers buy a lot of low-priced products but also care about quality. Think locally Understand local product and service standards to provide a differentiated experience. 2016 Openbravo Inc. All Rights Reserved. 12

China Population of 1.37 billion Median age: 37.1 % of people aged 15-64: 73% $3.05 trillion in total retail sales 9.7% CAGR in retail sales (2013-2015) Advantage: Huge potential market Disadvantage: Very competitive market, supply chain weaknesses 2016 Openbravo Inc. All Rights Reserved. 15

India Population:1.31 billion Median age: 27.6 % of people aged 15-64: 66% $1.01 trillion in retail sales 8.8% CAGR in retail sales (2013-2015) Advantage Economic stability, regulatory reforms create more business-friendly environment Disadvantage Real estate availability, intermittent network connectivity, and weak logistics 2016 Openbravo Inc. All Rights Reserved. 16

Mexico Population:127 million Median age: 28 % of people aged 15-64: 66% $465 million in total retail sales 5.2% CAGR in retail sales (2010-2014) Advantage Growing private consumption, increased access to credit, and strong job creation expand retail market Disadvantage Market is approaching maturity 2016 Openbravo Inc. All Rights Reserved. 17

Other Countries Country Population (million) Total Retail Sales (billions) CAGR Retail Sales (%) Indonesia 256 324 2.6 Vietnam 92 87 7.1 Colombia 48 91 (-11.9) Peru 32 70 (-3.3) Sri Lanka 20.7 29.8 10.3 Kenya 44 26 4.6 2016 Openbravo Inc. All Rights Reserved. 18

How Openbravo Helps You Succeed in Emerging Markets Key Business Challenges Impacting Technology Selection 1. Ambitious Expansion Plans 2. Fast-Changing Market Environment 3. Poor Network Reliability 4. Fast-Growing Competition 5. Workforce Challenges 6. Strong Budget Constraints 2016 Openbravo Inc. All Rights Reserved. 20

Challenge 1: Ambitious Expansion Plans Need for Featured customer SPEED Decathlon Sports India, Sporting Goods, India How does Openbravo help? Key Features Key Benefits Full web and Cloud-ready. Centralized multi-store management. Highly interoperable platform. Simplified IT landscape with faster technology deployments in AWS. Set-up of new stores in less than one business day. Faster integration and visibility from HQ with capacity to seamlessly integrate with any ERP. 2016 Openbravo Inc. All Rights Reserved. 22

Challenge 2: Fast-Changing Market Environment Need for Featured customer FLEXIBILITY & ADAPTABILITY How does Openbravo help? PT. Bintang Indo Jaya, Bakery, Indonesia Key Features Key Benefits Truly modular and highly scalable architecture in the Cloud. Scalable from a Store Solution to an All-in-one Retail ERP. Fast update of products, prices and promotions. Adapt faster to local needs and grow with confidence in the Cloud. Extend easily to future new business needs in a single product Make new products and prices available in your stores in minutes. 2016 Openbravo Inc. All Rights Reserved. 24

Challenge 3: Poor Network Reliability Need for Featured customer ISOLATION FROM NETWORK OUTAGES How does Openbravo help? Halsted, Building Materials, Zimbabwe Key Features Key Benefits Standard browser-managed off-line support. Store Server component for more demanding scenarios. Ensure uninterrupted sales operations. Gain greater deployment flexibility with hybrid deployment scenarios. 2016 Openbravo Inc. All Rights Reserved. 26

Challenge 4: Fast-Growing Competition Need for Featured customer INNOVATION & DIFFERENTIATION How does Openbravo help? M&B Footwear, Footwear, India Key Features Key Benefits Modern mobile and Web POS. Flexible technology platform ready to build omnichannel services. Truly modular commerce architecture. Deliver a highly differentiated assisted sale everywhere in the store. Gain capacity to integrate online and offline seamlessly. Adapt easier and faster for competitiveness. 2016 Openbravo Inc. All Rights Reserved. 28

Challenge 5: Workforce Challenges Need for Featured customer MODERN & EASE OF USE Materiales Amezcua, Building Materials, México How does Openbravo help? Key Features Key Benefits Stylish, very easy to use and highly productive solution. Mobile Web POS with training mode. Mobile-enabled platform: sales, inventory. Attract talented people, increase user adoption and boost team collaboration. Train new store associates in minutes to ensure customer service levels. Embrace mobility for greater staff productivity. 2016 Openbravo Inc. All Rights Reserved. 30

Challenge 6: Strong Budget Constraints Need for Featured customer AFFORDABILITY Cheers, Wine, China How does Openbravo help? Key Features Key Benefits Open source stack. Flexible subscription-based pricing. Full web and cloud-ready architecture. Eliminate need of additional licenses, so reducing total software cost. Reduce initial risk with lower initial investments. Gain IT store agility while lowering overall store IT costs. 2016 Openbravo Inc. All Rights Reserved. 32

Key Takeaways More than half of retail spending in the world now comes from consumers in emerging markets. Emerging markets are by definition in transition, so consumers tastes and habits are evolving and unpredictable. Increased competition in many emerging markets obliges retailers to adopt efficient systems and boost productivity. Emerging market retailers do not often have legacy IT issues so they are ideally placed to benefit from state-of-the art retail IT solutions. 2016 Openbravo Inc. All Rights Reserved. 33

Thank you very much for your attention www.openbravo.com/contact info@openbravo.com Web: Email: Spain Office: +34 932 725 947 France Office: +33 (0)1 70 08 73 62 India Office: +91 33 23576501 Mexico Office: +52 (155) 2506 1878 2016 Openbravo Inc. All Rights Reserved. 36