Executives and economists at the World Retail Congress said strong economic growth and rising middle classes were drawing their attention to countries such as Colombia, Egypt, Indonesia, Mexico, South Africa, Turkey and Vietnam.
"These otherwise disparate countries have one thing in common: They are all on the radar screen of some of the world's leading retailers," consultants Deloitte and Planet Retail said in a report presented at the conference.
Some store groups have already identified their targets.
U.S. group Wal-Mart , the world's biggest retailer, said last month it was in talks to buy South Africa's Massmart in a potential $4 billion that would give it a launchpad to expand through sub-Saharan Africa.
Ira Kalish, director of global research at Deloitte, said that with many U.S. and European retailers sitting on big cash piles and facing sluggish growth at home, the industry was primed for a pick up in dealmaking.
"I think within retail we are going to see a lot of transaction activity, a lot of cross-border transaction activity," he told delegates.
Wary of the retail industry's chequered history of mergers and acquisitions, some groups will prefer to open their own stores or work with local partners.
Kingfisher , Europe's biggest home improvements retailer, told Reuters it was interested in buying parcels of stores in existing markets, which include Poland and Turkey, and would also look at franchise deals in eastern Europe and the Middle East, though not for two or three years.
Reducing the Risks
Mark Olbrich, an industry veteran who has helped retailers expand in central and eastern Europe, said expanding alone or with local partners both ran dangers.
Opening new stores takes longer and costs more money than working with a local retailer, while using a partner risks losing control of a brand and diluting profits, he said.
However, there are signs that retailers are finding less risky ways to expand in unfamiliar markets.
One emerging trend is for companies to work with a partner and then buy them out, or take stakes in them, when the local business has become established.
British luxury group Burberry announced a deal in July to buy 50 stores in China from its franchisees, while mother and baby goods chain Mothercare has taken stakes in its Australian and Indian franchise operations.
Some retailers are also looking to the internet as a low cost way of testing out new markets.
"It's the advance guard (for overseas expansion)," said Stuart Rose, chairman of Britain's Marks & Spencer .
Martin Sorrell, chief executive of WPP , the world's biggest advertising group, underscored the growing importance of a range of emerging markets to companies, including retailers.
What he called the "BRICs and next eleven" emerging markets have grown to account for about 28 percent of group revenues, closing in on its goal of 33 percent and leading him to talk about raising that target towards 40 percent. (Reuters)
