Changing spending patterns and competition push companies towards e-commerce in Trinidad and Tobago

Trinidad and Tobago’s retail sector has been impacted by the national economy’s recent period of slow growth, with consumer behaviour – including reduced consumption and evolving spending patterns – accounting for shortfalls in an otherwise promisings sector.

State of Play

The national government has been keen to highlight the importance of the retail sector both to the consumer and the economy, with data from the Central Statistics Office (CSO) showing that the sector contributed $12.2bn to GDP in 2018, equating to 3.7% of the total. However, according to the Central Bank’s “Monetary Policy Report”, sales fell by 1.2% year-on-year (y-o-y) in May 2019, largely due to reduced sales of motor vehicles and parts (-3.0%), household appliances and furnishings (-6.1%), textiles and clothing (-3.9%), and groceries (-6.5%). These declines outweighed increases in other subcategories of the index, including dry goods (1.7%), and materials and hardware (2.9%). In terms of gross prices, most subindices detailed by the report reflected minimal growth, with the exception of the drink and tobacco subindex, which registered a marginal decline.

At the same time, the landscape has become competitive, particularly for food retail, with one retail distributor telling OBG that luxury product sales have recently fallen. Indeed, according to central bank data, the distribution sector contracted during the second quarter of 2019. Producer prices, as measured by the CSO’s producer price index (PPI), remained muted in the first quarter of 2019, and the PPI increased by just 0.8% y-o-y during the second quarter of the year. The retail price index of goods remained stable throughout 2019, finishing August at 108.7, a slight increase on the August 2018 figure of 107.4. Food, beverages and tobacco were all up, while there was a notable fall in the clothing and footwear index compared to 2018.

There are some bright signs, however. Paula Gopee-Scoon, the minister of trade and industry, stated in April 2019 that up to TT$7.6bn ($1.1bn) could be generated – and as many as 3108 jobs created – in the retail sector between 2016 and 2021.

Retail Spaces

Several new projects have been seen across the country. Brentwood Mall in central Trinidad is due to open in mid-2020 and will offer a new retail experience for the Brentwood and Brookhaven neighbourhoods. It has a primary catchment area of 25,000 people and opens up secondary and tertiary markets of around 270,000. Elsewhere, Pennywise Cosmetics inaugurated its second shopping complex in November to complement its existing 10 stores and six pharmacies throughout T&T. The new facility will span 3345 sq metres and host 22 store fronts, representing a multimillion-dollar investment that will create an estimated 500 jobs in the area. Pennywise plans to expand even further into pharmaceuticals and real estate, with the company already controlling 65% of the personal care market and over 80% of the perfumes trade in the country.


In 2019 a number of new retail opportunities were pursued by investors and franchise owners, signalling increased expansion in the sector. The Caribbean’s first Bath & Body Works store opened at the Falls of Westmall complex in Port of Spain in April 2019, a new branch of the Aeropostale clothing franchise opened in November 2019, and new locations for Pita Pit and Domino’s Pizza were added. Meanwhile, Clear Channel Airports has been awarded a five-year contract to deliver advertising services to T&T’s two main international airports, Piarco International and ANR Robinson International, which together see over 3m passengers annually. However, as the penetration of foreign franchised brands increases, concerns have been raised that more foreign exchange will leave the country (see Economy chapter).

Going In-house

According to retailers, a decline in spending has taken place over a number of years, and many are seeing reduced sales as the market softens. One notable behavioural change is that consumers are less particular about food brands and are increasingly making choices based on value; suppliers have had to react accordingly. T&T-based distributor A S Bryden and Sons, whose two main divisions are food and alcoholic beverages, has decided to focus on its own brands in each key business area and many food imports now come from Turkey due to their competitive value. The company is currently looking to Latin America as a burgeoning import market, and is distributing Colombian brands ColCafe and Colombina, and Bon Ice Cream from the Dominican Republic. In order to effectively lessen the shocks of changing consumer habits on its retail enterprise, Bryden is also looking into manufacturing products locally.


The Caribbean has traditionally been slow to develop and implement new technology. However, pilot self-service checkouts for supermarkets are due to commence before the end of the year, and other forms of online shopping are gaining traction in the local market. Online clothes and appliance purchases are common, but online food shopping has not yet caught up, and many local retailers do not have websites, instead relying on Facebook and other social media platforms to drive sales.

Although there are around 10 retailers offering e-commerce to the local population, even when e-commerce is available, consumers generally prefer to shop online at US stores for better quality, variety and price. The government estimates that Trinbagonians spend $500m annually on US purchases via e-commerce. Very little business-to-business e-commerce exists in the country, and while online payments are growing, they remain low and mobile e-commerce is rarer still.

The government placed a 7% tax on online shopping in 2017, but this has made done little to reduce online sales. Over 140 local small and medium-sized enterprises participated in an e-commerce forum in March 2019, and as of September 180 entrepreneurs were participating in training sessions organised by the Ministry of Trade and Industry and ExporTT.


As is the case in many markets, digital marketing in T&T has become increasingly popular due to the prohibitive costs of other types of marketing, along with the possibility of directly targeting desirable market segments. Digital marketing takes place primarily on Facebook and YouTube.

Local companies are also working to digitalise their business models and have a better understanding of supply chains. “One area we have identified for improvement is combining software with hardware,” Derek Lawrence, managing director of Insepra, a distributor based close to Port of Spain, told OBG. “This would enable us to track and trace our manufacturers’ products throughout the entire supply chain, from raw material to distribution.” However, fully capitalising on digitalisation’s benefits may take some time. “The world is moving towards Industry 4.0, an era of manufacturing that uses artificial intelligence to improve efficiency, but T&T has some catching up to do in this regard,” Brian James, general manager of industry services at the MIC Institute of Technology, told OBG.

Leveraging digitalisation to improve the general business environment is also of focus. “Simple things like paying for many government services is still not electronic, which is inefficient. Many of the requirements for optimising the benefits of the CARICOM Single Market Economy are not operational, such as a regional registry for companies and regional filings for intellectual property,” Gabriel Faria, CEO of the T&T Chamber of Industry and Commerce, told OBG. “We need regional governments to focus on improving the ease of doing business so the private sector can focus on making a positive impact on employment, intraregional business and global competitiveness.”

Stumbling Blocks

One of the most commonly identified barriers to growth for retailers is the apparent ease with which high tax regimes on retail goods – such as alcohol – can be circumvented by illegal imports. A 2016 tax increase on imported alcoholic beverages exacerbated the problem, squeezing margins for those complying with regulations. Another issue is the speed of value-added tax (VAT) refunds. VAT is levied at 12.5% and registered businesses must collect the tax from customers, submit returns and pay the VAT that they owe. While they can then deduct any VAT paid when purchasing goods and services for the business, the government still owes the private sector a significant amount of money in VAT refunds, according to Faria, which also hinders investment decisions and export development. As such, small companies with limited liquidity cannot absorb these slow refunds in the same way larger enterprises can, effectively penalising businesses for their compliance.


With new investments and growing penetration of large retailers in the region, the sector is in good health. While stakeholders are looking for greater autonomy for the private sector moving forward, the general barrier for retail pertains to tackling issues affecting distribution. Digitalisation and the uptake of e-commerce could go a long way in addressing these.

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The Report: Trinidad & Tobago 2020

Industry & Retail chapter from The Report: Trinidad & Tobago 2020

Cover of The Report: Trinidad & Tobago 2020

The Report

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