CHAPTER -1

Overview of Retail Industry

1.1 Introduction

1.2 What is Retail?

1.3 Global Retail Industry

1.4 Key Players in world of Retail

1.4.1 Wal-Mart

1.4.2 Carrefour

1.4.3 Tesco

1.4.4 IKEA

1.4.5 Metro Group

1.4.6 McDonald’s

1.4.7 Home Depot

1.4.8 Kroger

1.5 Retail Industry in India

1.6 Growth of Retail Industry in India

1.7 Types of Retail Chain in India

1.7.1 Food & Grocery retail

2

1.7.2 Apparel

1.7.3 Jewellery and Watches

1.7.4 Consumer Electronics, Durables, Mobiles & IT

1.7.5 Pharmacy

1.7.6 Home Furnishing & Furniture

1.7.7 Food & Beverages Services

1.7.8 Footwear

1.8 Key Players in Retail Chains in India

1.8.1 Future Group

1.8.2 Pyramid Retail Ltd

1.8.3 Shoppers Stop

1.8.4 Trent-Westside

1.8.5 Vishal Retail

1.8.6 RPG Group

1.8.7 Viveks-The Unlimited Shop

1.8.8 Metro-Cash & Carry India

1.8.9 Aditya Birla-More

1.8.10 Bharti- Wal-Mart

1.8.11 Reliance Retail

3

1.1 INTRODUCTION

India is one of the emerging markets in the global economy. Since liberalization, the

country has witnessed growth at unprecedented rate. With reforms in almost all the

sectors, the country has seen growth in infrastructure, capital markets, banking,

insurance, etc. This advancement has given rise to a new sector in the country in the

form of retail industry. With growth of industry, the employment levels have increased

and that has led to the increase of disposable income of the common consumer.

The gradual increase in GDP and the purchasing power of Indians provides an excellent

opportunity for organized retailing. The fast and furious pace of growth of the Indian

economy is the driving force for Indian consumerism. Projections by analysts

suggest that India has the potential to be labeled the fastest-growing economy and

outpace the developed economies by 2050. India presents a significant market

with its young population just beginning to embrace significant lifestyle changes.

The demographic and economic facts widely quoted are undoubtedly impressive but

— in order to assess the true nature of retail opportunities, we need to understand

the deep transformation that is occurring in Indian consumer behavior due to

changing lifestyles, rising aspirations and the emergence of a dynamic youth

culture. Against the backdrop of an accelerating modern retail revolution, India

offers to be an attractive destination for global corporations and leading retailers

seeking emerging markets overseas.

4

Retailing in India is receiving global recognition and attention and this emerging

market is witnessing a significant change in its growth and investment pattern. Some of

the highlights of the Indian Retail sector are: The Indian retail industry accounts for

10% of GDP and 8% of employment.

� India is being touted as the next big retail destination with an average three

year compounded annual growth rate of 46.64%.

� The Indian economy is poised to take the third position in the world in terms

of Purchasing Power Parity by the year 2010.

� The Indian Retail Market is an Rs.1, 200,000 million markets as per the Images

India Retail Report 2007.

� Organized Retail market is zooming ahead with an annual growth rate of 30%.2

The Retail sector is vibrant with growth happening in all related areas - be they

malls, hypermarkets or single brand luxury stores, they have dotted the commercial

landscape of the metros, and have even percolated to the Tier II and Tier III cities.

It is not just the global players like Wal-Mart, Tesco and Metro group are eying to

capture a pie of this market but also the domestic corporate behemoths like Reliance, KK

Modi, Aditya Birla group, and Bharti group too are at some stage of retail

development. Reliance, announced that it will invest $3.4 billion to become the

country's largest modern retailer by establishing a chain of 1,575 stores by March 2007.3

5

Development of mega malls in India is adding new dimensions to the booming retail

sector. Shopping experience in the nation of shopkeepers is changing and changing very

fast. Malls are fast becoming sought-after entertainment hotspots. From a situation

where there were no malls about a decade ago, the country has 300 malls translating to

over 100 million sq ft is available mall space by the end of 2007.

Food and Grocery retail holds the most potential, as almost 99% of it is unorganized.

A number of big players are entering the field of organized food retail like Reliance,

Aditya Birla Group and the Bharti Group, which has tied up with the world’s

largest retailer -WalMart. All these major players are expected to show an annual

growth rate of 25- 30%.

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1.2 WHAT IS RETAIL?

Retail is the final stage of any economic activity. By virtue of this fact, retail occupies

an important place in the world economy. In an attempt to understand the scope of the

term retail, various definitions of the term have been examined.

According to Philip Kotler , ‘Retailing includes all the activities involved in selling

goods or services to the final consumers for personal, non-business use. A retailer or

retail store is any business enterprise whose sale volume comes primarily from

retailing.

Any organization selling to final consumers whether it is a manufacturer, wholesaler or

retailer is doing retailing. It does not matter how the goods or services are sold (by

person, mail, telephone, vending machine or internet or where they are sold- in a store,

on the street or in the consumer’s home)’.

The North American Industry Classification System (NAICS) specifies that the retail

trade sector comprises establishments primarily engaged in retailing merchandise,

generally without transformation, and rendering services incidental to the sale of

merchandise.

7

The word retail is derived from the French word retailer, which means to cut of a piece

or to break bulk. Therefore, a retailer may be defined, as a ‘dealer or trader who sells

goods in small quantities or one who repeats or relates’.

Retailing thus, may be understood as the final step in the distribution of merchandise,

for consumption by the end consumers. Put simply, any firm that sells products to the

final consumer is performing the function of retailing. It thus consists of all activities

involved in the marketing of goods and services directly to the consumers, for their

personal, family or household use.

It is necessary to understand that in the complex world of trade today, retail would

include not only goods but also services that may be provided to the end consumer. In

an age where the customer is the king and marketers are focusing on consumer delight,

retail may be redefined as the first point of customer contact.

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1.3 GLOBAL RETAIL INDUSTRY: SOME FACTS

� Worldwide retail sales are estimated at $7 trillion (USD).

� The top 200 largest retailers account for 30% of worldwide demand.

� The money spent on household consumption worldwide increased 68%

between 1980 and 1998.

� Retail sales are generally driven by people’s ability (disposable income)

and willingness (consumer confidence) to buy.

� The world’s population is poised to expand 50% by 2050. The world is

currently 78% poor, 11% middle income and 11% rich.

� Some two-thirds or $6.6 trillion out of the $10 trillion American

economy is consumer spending. About 40% of that ($3 trillion) is spending on

discretionary products and services.

� Retail turnover in the EU was almost €2,000 billion in 2001 and the

sector’s better than average growth looks set to continue in the future.

� Retail trade in Europe employs 15% of the European workforce (3 million

firms and 13 million workers)

� Time and quality of life are becoming relatively more important than

money; 60% of Americans want to simplify their lives.

� In U.S Product performance was found to be the top purchasing

criterion, while environmental features were a close second in a survey.

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1.4 KEY PLAYERS IN THE WORLD OF RETAIL

1.4.1 Wal-Mart

When one thinks of Wal-Mart, one thinks big! It's the world's biggest retailer and also

the biggest employer with over 1.8 million full- and part-time workers. It operates

Wal-Mart stores along with Sam's Club membership warehouses in the U.S. and 15

foreign countries. Known for its low pricing and wide selection of goods, Wal-Mart has

become the undisputed king of retailing. It is also a feared giant for its sheer size and

pricing power. For fiscal 2005, Wal-Mart had record revenues of $312.4 billion and

net income of $11.2 billion. U.S. sales rose 3.0% in Wal-Mart stores and 5.0% in

Sam's Club stores.

Wal-Mart has more than 3,800 stores worldwide. The company has been growing

rapidly overseas, especially in China. It now generates 20% revenues internationally.

With its growth and dominance, Wal-Mart has become a target of opposition for its low

worker pay and sheer size. In response, the company has tried to improve its image and

announced a new program to offer health plans to part-time workers. Recently the

world’s biggest retailer, Wal-Mart, also entered India with a 50:50 JV with Bharti

Group. The group aims of holding 15-18 Million Sq. ft. by FY10. It is expected to

provide employment to around 60000 people by 2010 and be a major player in retail

sector.

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1.4.2 Carrefour

The supermarket of tomorrow, the Carrefour group specializes in large scale distribution

and has come a long way since the creation of its first supermarket in

1963.Carrefour is the European leader in distribution, the World’s second, owns a

number of other brands such as Shopi, Champion, Norte, Dia and ED, and has 11 000

shops in 32 countries, including in China. It is no mere chance that Carrefour today

serves more than 2 billion customers. The customer is king and the group is constantly

innovating. From the development of ranges of local products to the implementation of

supply chain management (product tracking, respect for the environment), it is

constantly adapting to its customers' new consumption patterns. The group has also

developed a number of other customer services, such as the sale of financial

products, theatre and concert tickets, holidays and Internet-selling. The group's

long-term aim is to become the supermarket of the future where the customer can

find everything they need under one roof.5

1.4.3 Tesco

Tesco operates 923 stores and employs 240,000 people, giving access to a population of

260 million across our nine markets. Over the past five years, the company has

expanded from traditional UK supermarket base into new countries, products and

services, including a major non-food business, personal finance and internet

shopping. The increasing scale and internationalization of sales and purchasing

operations makes a significant contribution to efficiency and profitability, as it has

progress towards the long-term goal of becoming a truly international retailer.

11

Tesco has 702 stores in U.K and is the largest food retailer in the United Kingdom.

Tesco continues to increase market share through the policy of cheaper prices, offering

better value and providing more choice and convenience for customers. The share of

the UK market has grown steadily since the early nineties as a result of customer

focused strategy: their market share is now 16.2%. Tesco operates 4 store formats in

the United Kingdom.

Table 1.4.3 Types of stores of Tesco

Source: www.tesco.com

1.4.4 IKEA

IKEA is a world wide furnishing company with operations in 42 countries and a total

number of 70,000 employees of which 59,000 work in Europe. It is a Swedish based

company built on the idea to “offer a wide range of well-designed, functional home

furnishing products at prices so low, that as many people as possible will be able to

afford them”. It started out in the 1940s by the entrepreneur Ingvar Kamprad, who

still has control over the company through the INGKA foundation, situated in the

Netherlands. The IKEA group is solely owned by the Foundation through a holding

company (INGKA holding B.V). It is therefore not listed on any stock exchange.

Originally, IKEA sold pens, wallets, picture frames, table runners, watches, jewelry

and nylon stockings or practically anything.

TYPE No of Stores Etras 29 Superstore 450 Metro/high Street 167 Express 56 Total 702

12

Furniture was firs added to the IKEA product range in 1947 and, in 1955, IKEA

began to design its own furniture. The company motto is: "Affordable Solutions for

Better Living". The bulk of the operations are that of retail business with 165 stores in

22 countries and a total of 75% of the employees in this area. In addition to purchasing

from outside suppliers the IKEA group also produces some of its own furniture through

the IKEA industrial group, Swedwood.

1.4.5 The Metro Group

The METRO Group was created in 1996 through the merger of leading retailing

companies. The corporate group is composed of high-performance, operationally

independent companies and businesses. The group includes:

� Metro Cash & Carry, the world’s market leader in cash & carry.

� Real hypermarkets and Extra supermarkets.

� Media Market and Saturn, Europe’s leader in consumer electronic retailing.

� Galeria Kaufhof, the system leader in the department store business

Metro Cash & Carry is the global market leader in self-service wholesale and at the

same time also the most international retail brand with the highest sales volume at

the METRO Group. A mature, efficient and internationally reproducible concept

guarantees the successful tapping of new markets. It offers commercial customers a

high assortment competence in food and nonfood products at favorable wholesale

prices. This makes Metro Cash & Carry the ideal partner for commercial customers

in numerous countries of the world. The assortment and service portfolio are

geared to meeting the special needs of professionals, mainly from the restaurant and

retailing sectors. In India, the company is expected to invest close to Rs. 1800-2000

crore in the next three years to open 15-18 stores in all major cities across the country.

13

1.4.6 Mc. Donald’s

Mc. Donald’s is the leading global foodservice retailer with more than 30,000

local restaurants serving nearly 50 million people in more than 119 countries each day.

It is one of the world's most well-known and valuable brands and holds a leading share

in the globally branded quick service restaurant segment of the informal eating-out

market in virtually every country in which it does business. McDonald’s Corporation

operates as a foodservice retailer worldwide .McDonald was founded in 1948 and is

based in Oak Brook, Illinois. Ray Kroc opened the Des Plaines restaurant in 1955.

In 1965 McDonald's went public with the company's first offering on the stock

exchange.. The company also operates Boston Market and Chipotle Mexican Grill

concept restaurants, as well as owns a minority interest in U.K.based Pret A Manger, a

quick-service food concept. As of December 8, 2006, it operated approximately

30,000 restaurants in 100 countries.

1.4.7 HOME DEPOT

The Home Depot is an American retailer of home improvement and construction

products and services. In terms of overall revenue reported to the U.S. Securities and

Exchange Commission, The Home Depot is the largest home improvement retailer in

the United States, ahead of rival Lowe's. The store operates out of large warehouse

style buildings averaging 105,000 ft² (9,755 m²) with mega stores operating in larger

facilities (the company's largest store, located in Union, New Jersey is 225,000 ft²).

14

1.4.8 KROGER

In 1883, Bernard "Barney" Kroger invested his life savings of $372 (roughly equal to

$9,278.74 today) to open a grocery store in the Mount Airy neighborhood of

Cincinnati. Kroger was the son of a merchant, and his slogan was simple: “Be

particular. Never sell anything you would not want yourself.” Kroger tried many ways

to satisfy customers. He tried to make his own products, such as bread, so that

customers would not need to go to a separate bakery. In the 1930s, Kroger was the first

grocery chain to monitor product quality and test foods offered to customers, and also

the first to have a store surrounded on all four sides by parking lots. In 1955, Kroger

acquired Henke & Pilot. Kroger rebranded that chain as Kroger in 1966. In the 1970s,

Kroger became the first grocer in America to test an electronic scanner, and the first to

formalize consumer research.

15

1.5 INDIA RETAIL MARKET: OVERALL MARKET TRANSFORMING INDIAN RETAIL SECTOR :

India’s retail sector is wearing new clothes and with a three-year compounded annual

growth rate of 46.64 per cent, Retail is the fastest growing sector in the Indian

economy. Western style malls have begun appearing in metros and second-rung cities

alike, introducing the Indian consumer to an unparalleled shopping experience.

Graph 1.5.1 Retail growth in India

Source: Technopak Estimates

While organized retail in India is only four per cent of the total US$ 302 billion retail

industry, it is expected to grow 25 per cent annually, driven by changing lifestyles,

strong income growth and favorable demographic patterns. The penetration levels of

organized retail are expected to touch 8% by 2010, thereby taking the total organized

retail business to around Rs. 1095 billion. Organized retail is expected to grow at 25-

30% per annum, with home décor and food & grocery emerging as the fastest

growing segments. The proliferation of hypermarkets and supermarkets has led to a

growth in food and grocery retail. The other high growth verticals are apparel and

durables.

Overall Retail Market US$billion

0

100

200

300

400

500

600

700

800

2006 2011 2016

Year

$ b

illi

on

Series1

16

1.6 Growth of Retail Industry in India

Growth over 1997-2010

India in 1997 allowed foreign direct investment (FDI) in cash and carry wholesale.

Then, it required government approval. The approval requirement was relaxed, and

automatic permission was granted in 2006. Between 2000 to 2010, Indian retail

attracted about $1.8 billion in foreign direct investment, representing a very small 1.5%

of total investment flow into India.

Single brand retailing attracted 94 proposals between 2006 and 2010, of which 57 were

approved and implemented. For a country of 1.2 billion people, this is a very small

number. Some claim one of the primary restraint inhibiting better participation was that

India required single brand retailers to limit their ownership in Indian outlets to 51%.

China in contrast allows 100% ownership by foreign companies in both single brand

and multi-brand retail presence.

Indian retail has experienced limited growth, and its spoilage of food harvest is

amongst the highest in the world, because of very limited integrated cold-chain and

other infrastructure. India has only 5386 stand-alone cold storages, having a total

capacity of 23.6 million metric tons. However, 80 percent of this storage is used only

for potatoes. The remaining infrastructure capacity is less than 1% of the annual farm

output of India, and grossly inadequate during peak harvest seasons. This leads to about

30% losses in certain perishable agricultural output in India, on average, every year.

17

Indian laws already allow foreign direct investment in cold-chain infrastructure to the

extent of 100 percent. There has been no interest in foreign direct investment in cold

storage infrastructure build out. Experts claim that cold storage infrastructure will

become economically viable only when there is strong and contractually binding

demand from organized retail. The risk of cold storing perishable food, without an

assured way to move and sell it, puts the economic viability of expensive cold storage

in doubt. In the absence of organized retail competition and with a ban on foreign direct

investment in multi-brand retailers, foreign direct investments are unlikely to begin in

cold storage and farm logistics infrastructure.

Growth after 2011

Before 2011, India had prevented innovation and organized competition in its consumer

retail industry. Several studies claim that the lack of infrastructure and competitive

retail industry is a key cause of India's persistently high inflation. Furthermore, because

of unorganized retail, in a nation where malnutrition remains a serious problem, food

waste is rife. Well over 30% of food staples and perishable goods produced in India

spoil because poor infrastructure and small retail outlets prevent hygienic storage and

movement of the goods from the farmer to the consumer.

One report estimates the 2011 Indian retail market as generating sales of about $470

billion a year, of which a miniscule $27 billion comes from organized retail such as

supermarkets, chain stores with centralized operations and shops in malls. The opening

of retail industry to free market competition, some claim will enable rapid growth in

retail sector of Indian economy. Others believe the growth of Indian retail industry will

take time, with organized retail possibly needing a decade to grow to a 25% share.

18

The Economist forecasts that Indian retail will nearly double in economic value,

expanding by about $400 billion by 2020.19 The projected increase alone is equivalent

to the current retail market size of France.

In 2011, food accounted for 70% of Indian retail, but was under-represented by

organized retail. A.T. Kearney estimates India's organized retail had a 31% share in

clothing and apparel, while the home supplies retail was growing between 20% to 30%

per year. These data correspond to retail prospects prior to November announcement of

the retail reform. The Indian market offers endless possibilities for investors.

19

1.7 Types of Retail Chains

A) Food and Grocery

B) Apparel

C) Jewellery and Watches

D) Consumer Durables, Mobiles and IT

E) Pharmacy

F) Home Furnishing and Furniture

G) Food and Beverages services

H) Footwear

20

(A) FOOD AND GROCERY RETAIL

• Food and Grocery market in India is estimated at US$ 325 Bn in 2011 (69% of the overall

retail ) and is expected to grow to US$ 425 Bn by 2016 (63% of the overall retail ), @

CAGR of 5.5%

• The organized Food and Grocery retail market in India is estimated at US$ 9 Bn in 2011

and is expected to grow to US$ 34 Bn by 2016, @ CAGR of 30%

Table 1.7.1

Source: Technopak analysis

Food and Grocery

217

325

425

2 934

0

50

100

150

200

250

300

350

400

450

2006 2011 2016

Year

$ b

illi

on

Total Market

Organized retail market

21

(B) APPAREL

• Apparel market in India is estimated at US$ 35 Bn in 2011 and is expected to grow to

US$ 50 Bn by 2016, @ CAGR of 7.5%

• The organized Apparel retail market in India is estimated at US$ 5.5 Bn in 2011 and is

expected to grow to US$ 8 Bn by 2016, @ CAGR of 8.5%

Table 1.7.2

Source: Technopak analysis

Apparel

25

35

50

3.5 5.58

0

10

20

30

40

50

60

2006 2011 2016

Year

$ b

illi

on

Total Market

Organized retail market

22

(C) JEWELLERY & WATCHES:

• The Jewellery & Watches market in India is estimated at US$ 26 Bn in 2011 and is

expected to grow to US$ 44 Bn by 2016, @ CAGR of 11.5%

• The organized Jewellery & Watches retail market in India is estimated at US$ 2.5 Bn

in 2011 and is expected to grow to US$ 7.5 Bn by 2016, @ CAGR of 25%

Table 1.7.3

Source: Technopak analysis

Jewellery and Watches

17

26

44

1 2.5

7.5

0

5

10

15

20

25

30

35

40

45

50

2006 2011 2016

Year

$ b

illi

on

Total Market

Organized retail market

23

D) CONSUMER ELECTRONICS, DURABLES, MOBILE & IT

• The Consumer Electronics, Durables, Mobiles & IT market in India is estimated at US$

23 Bn in 2011 and is expected to grow to US$ 43 Bn by 2016, @ CAGR of 13.5%

• The organized Consumer Electronics & IT retail market in India is estimated at US$ 4 Bn

in 2011 and is expected to grow to US$ 18 Bn by 2016, @ CAGR of 35%

Table 1.7.4

Source: Technopak analysis

ConsumerDurables, Mobile and IT

17

23

43

1.54

18

0

5

10

15

20

25

30

35

40

45

50

2006 2011 2016

Year

$ b

illi

on

Total Market

Organized retail market

24

E) PHARMACY

• The Pharmacy market in India is estimated at US$ 14 Bn in 2011 and is expected to grow

to US$ 23 Bn by 2016, @ CAGR of 11.0%

• The organized Pharmacy retail market in India is estimated at US$ 0.8 Bn in 2011 and is

expected to grow to US$ 4.5 Bn by 2016, @ CAGR of 41%

Table 1.7.5

Source: Technopak analysis

Pharmacy

8

14

23

0.2 0.8

4.5

0

5

10

15

20

25

2006 2011 2016

Year

$ b

illi

on

Total Market

Organized retail market

25

F) HOME FURNISHING AND FURNITURE

• The Home Furnishings and Furniture market in India is estimated at US$ 8 Bn in 2011

and is expected to grow to US$ 17 Bn by 2016, @ CAGR of 13.5%

• The organized Home Furnishings and Furniture retail market in India is estimated at US$

0.7 Bn in 2011 and is expected to grow to US$ 1.2 Bn by 2016, @ CAGR of 12%

Table 1.7.6

Source: Technopak analysis

Home furnishing and furniture

7

9

17

0.4 0.7 1.2

0

2

4

6

8

10

12

14

16

18

2006 2011 2016

Year

$ b

illi

on

Total Market

Organized retail market

26

G) FOOD AND BEVERAGES SERVICES

• The Food & Beverages Services market in India is estimated at US$ 9 Bn in 2011 and is

expected to grow to US$ 16 Bn by 2016, @ CAGR of 12.5%

• The organized Food & Beverages Services retail market in India is estimated at US$ 1.5

Bn in 2011 and is expected to grow to US$ 6 Bn by 2016, @ CAGR of 30%

Table 1.7.7

Source: Technopak analysis

food and beverages

5

9

16

0.51.5

6

0

2

4

6

8

10

12

14

16

18

2006 2011 2016

Year

$ b

illi

on

Total Market

Organized retail market

27

H) FOOTWEAR

• The Footwear market in India is estimated at US$ 5 Bn in 2011 and is expected to grow

to US$ 8 Bn by 2016, @ CAGR of 13.0%

• The organized Footwear retail market in India is estimated at US$ 1.7 Bn in 2011 and is

expected to grow to US$ 3.8 Bn by 2016, @ CAGR of 17.5%

Table 1.7.8

Source: Technopak analysis

Footwear

4

5

8

11.7

3.8

0

1

2

3

4

5

6

7

8

9

2006 2011 2016

Year

$ b

illi

on

Total Market

Organized retail market

28

1.8 KEY PLAYERS IN RETAIL CHAINS IN INDIA

1.8.1 Future Group.

India's leading retailer with a turnover close to INR 11 billion (US$242 million) for

the financial year ended June 2005. The company was incorporated on October 12,

1987, as Men’s Wear Private Ltd. It converted into a public limited company in

September 1991. The company sold branded garments under the Pantaloon, Bare, and

John Miller brands and set up its first Men’s wear Pantaloon Shoppe outlet in 1993. Its

name was changed to Pantaloon Retail (India) ltd. in 1999.

Type of Stores

The Future Group operates through six verticals: Future Retail, Future Capital,

Future Brands, Future Space, Future Media and Future Logistics. Today, Future Group

has presence across multiple segments including food, fashion and footwear,

home solutions and consumer electronics, books and music, wellness and beauty,

general merchandise, telecom and IT, E-tailing, leisure and entertainment and

financial products and services. The company has entered into a multi-format

department stores and hypermarkets. Future Group has effectively blended multiple

strategies and thereby, successfully addressed a high share of the customer’s basket.

29

(a) Lifestyle Segment

� Pantaloon: Private Apparel stores addressing the needs of the family. Its main

target customer belongs to SEC A and SEC B in urban India. It offers a wide

range of garments, accessories and lifestyle products.

� Central: Central are large format malls located in the heart of the city. They have

a store space in the range of 125000 square feet to 250000 square feet.

� Blue Sky: Blue Sky is a national chain of stores offering a wide selection of

branded and private label sunglasses and watches.

� ALL: A Little Larger houses a wide range of ready-to-wear fashionable clothes and

accessories that are otherwise not easily available for plus size customers. ALL brings

forth a wide collection of clothing to select from, be it Western wear, Indo-western or

Ethnic wear in both Formal and Casual categories.

(b)Value Segment

� Big Bazaar: Big Bazaar is a large hypermarket with store sizes ranging from 30000

to more than 1,00,000 square feet. Its sells food items, utensils, luggage, white goods,

electronics, cosmetics, jewellery, pharmaceuticals, grocery items, etc, at a discount. The

stores are targeted at the spectrum of population with a high propensity.

� Food Bazaar: Food Bazaar replicates the local market to provide the much important

‘touch and feel’ factor that Indian housewives are used to in a local bazaar. It

represents the company’s entry into food retail and is targeted across all classes of

population.

� Fashion Station: Fashion station stores also address the needs of the family. Trendy

yet affordable, it offers apparels at affordable prices.

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Future Group also operates in other segments such as healthcare and beauty services

under the brand names Star & Sitara and Health Village, kids wear under the brand

name Gini & Jony, and Depot for books, music and gifts, stationery, etc. The

Health Village brand is targeted at the lower and middle income segment. Its sub-

brands will include Star & Sitara for its beauty salons, Tulsi for its pharmacy, Turmeric

for its beauty stores centers, Roots for its fitness centers, and Elaichi for its health café.

The company also plans to launch e-zone, a portal for e-retailing in the near future as

another delivery format. Headquartered in Mumbai, the company operates has over

100 stores across 25 cities in the country. Till date, Future Group has secured about

10 million sq.ft of additional retail space that will be operational by end of 2008.

1.8.2 Pyramid Retail Ltd.

In September 1999, Primal Enterprises made its foray into retail with the launch of

three retail concepts: India's first true shopping mall of international standards, called

Crossroads; a lifestyle department store called Pyramid Megastore; and a family

entertainment centre known as Jammin. Pyramid Mega store and Jammin are the

anchor tenants for Crossroads (recently sold to Pantaloon for INR 4 billion). In 2001,

the group entered the business of food & grocery retail with the launch of Pyramid

supermarkets in Pune. To expand its pure-play retail operations, Pyramid Retail Ltd.

announced an IPO raising INR 1.08 billion. Pyramid’s plans include adding 1.75

million sq.ft of retail space in operations and 150 stores across the country in the next

five years. Its operations, divided between two formats -department stores (seven

Pyramid Mega stores) and supermarkets (12 True art stores).

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1.8.3 Shoppers Stop

Shoppers’ Stop, promoted by the real estate group K Raheja, was one of the first movers

to have set up a large retail outlet in New Delhi with international ambience. Shopper’s

Stop Ltd now has a considerable presence all over the country with over 7 lakh square

feet of retail space and stocks over 200 brands of garments and accessories. The stores

are spread all over India with presence in Mumbai, Delhi, Bangalore, Hyderabad, Jaipur,

Pune, Kolkata, Gurgaon, Chennai & Ghaziabad. The stores offer a complete range of

apparel and lifestyle accessories for the entire family. From apparel brands like Provogue,

Color Plus, Arrow, Levi’s, Scullers, Zodiac to cosmetic brands like Lakme, Chambor,

Le Teint Ricci etc., Shoppers’ Stop caters to almost every lifestyle need.

1.8.4 Trent - Westside

Established in 1998, Trent operates some of the nation's largest and fastest growing

retail store chains. A beginning was made in 1998 with Westside, a lifestyle retail

chain, which was followed up in 2004 with Star India Bazaar, a hypermarket with a large

assortment of products at the lowest prices. In 2005, it acquired Landmark, India's

largest book and music retailer. In a recently signed deal, Trent has agreed to anchor 12

malls set up by DLF Universal Ltd across the country, at its Westside, Landmark and

Star India Bazaar outlets. This amounts to about 27 locations, totaling to about a

million square feet of space. Trent retails garments and household

accessories for men, women and children, cosmetics and perfumes at Westside, food,

beverages, health and beauty products, vegetables, fruits, dairy products, consumer

electronics and household items at Star India Bazaar and books, music and stationery at

Landmark.

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Westside has 25 outlets across 17 cities in India offering a variety of designs and styles in

garments, footwear and accessories, as table linens, artifacts, home accessories and

furnishings. Well-designed interiors, sprawling space, prime locations and coffee

shops enhance the customers' shopping experience. Trent also runs another chain of

retail stores called Star India Bazaar. Launched in 2004, Star India Bazaar provides a

large assortment of high quality products made available at the lowest prices coupled

with a unique shopping experience.

1.8.5 Vishal Retail

Vishal Mega Mart, a Delhi-based retailer started with selling primarily

clothing and accessories. Today, it operates 32 large stores and clocked sales of INR

2.88 billion last year. Vishal's ambitious retail plans by year 2010 include an IPO,

pumping in investments close to INR 12.5 billion and 220 outlets, taking its

cumulative retail space to 5 million sq.ft and a sales turnover of INR 50 billion. In

the current fiscal the chain plans to invest INR 3 billion and targets sales of over INR

7 billion. Moving away from franchising Vishal no wants to operate only though

company-owned outlets. Having already signed 32 deals for real estate acquisition for

this year itself, taking its retail space to 1.4 million sq.ft by the year end, the chain,

which was hitherto concentrated in north India, now wants to spread all over the

country. Eleven of the real estate deals signed include locations in Bangalore and

Hyderabad in the south and Ahmedabad, Vadodara, Nashik, Goa and Aurangabad in

the west. Out of the 60 new stores planned in the current fiscal, 15 each will come up

in the east, west and the north. Five stores would open in the southern region and 10

more will be in the central region, covering Delhi, Uttar Pradesh and Madhya Pradesh.

The group recently launched its first hypermarket in Udaipur. Spread over 25,000 sq ft.

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1.8.6 RPG Group

The RPG Group was the first to get into the organized

retailing business in India and expand beyond the south, the

only region where organized retail flourished with

retailers like Nilgiri's, Subhiksha, Viveks etc. RPG Retail

was also the first to venture into different formats and

categories. RPG Enterprises is one of India’s largest

business groups. It has business interests in retail,

technology, entertainment, power and transmission, tyres,

life sciences and specialties. The group entered in the

retail sector in 1996 by setting up Food world

Supermarket in collaboration with Dairy stores, Music

World and Health & Glow, respectively. In 2001, the

company commenced its hypermarket business with the

Giant Fascia.

STORES & CATEGORIES:

Food world began as a division of Spencer & Co, a part of the

RPG Group, in May 1996, and opened its first supermarket in

Chennai. Three years later, in August 1999, Food world was

hived off as a separate company. A 51-49 per cent joint

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venture between Spencer & Co and Dairy Farm International

(DFI) of the Jar dine Matheson Group (a US $ 4.5 billion retail

giant operating in the Asia-Pacific markets) was agreed upon.

By early 2005 Food world became an INR 3 billion company.

Most of the outlets are in South India. A typical Food world

store has the following product mix:

� Fruits & Vegetables - 7-10%

� Staples & Commodities - 18-25%

� FMCG products - 40%

� General Merchandise - 8%

In June 2000, the company entered into a JV with DFI to

operate cash and carry or discount stores across the country

where the later was to invest $4 million for a 49 per cent

stake in the new company, to be called Great Wholesale Club

Ltd (GWCL). However RPG decided to set up a new

hypermarket model with the 'Giant' brand and soon DFI

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decided to break ties with Spencer. Post-split Giant was

renamed as Spencer Hypermarket and GWCL announced

new formats - Spencer's Hyper (25,000 sq.ft), Spencer's

Super (8,000-15,000 sq.ft), Spencer's Daily (4,000-7,000

sq.ft) and Spencer's Fresh (2,000 sq.ft). The company’s

hypermarket concentrates on the food grocery range and it has

the following mix:

� Supermarket range - 75-80%

� Extended range - 25-30% (includes thermo wear, daily

garments, white goods)

In 1997 RPG launched yet another chain called Music World

which by 2003, grew to nearly 170 outlets covering nine

cities in India operating in three different formats - Music

World Destination (14 stores of about 4,000 sq.ft. each),

Music World Express (29 outlets of about 300 - 600 sq.ft)

and Music World Unplugged. The main competitor of Music

world is Planet M, which belongs to the Bennett & Coleman

Group.

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Music World runs 3 Types of stores:

� Destination stores: Main stores with an area of over

4000 square feet.

� Express stores: These are 300-600 square feet stores.

� unplugged: These are small gondolas, which operate in

department and large stores.

Health & Glow: In 1997, a similar JV came into existence

as RPG Guardian Private Limited to launch the country's

first retail chain 'Health & Glow' in the pharmacy and

beauty care segment. The chain is spread across major

cities of the south and is also present in Pune. Dairy

Farm International now owns this chain. With its

existing stores Spencer's Hyper, Spencer's Super,

Spencer's Daily and Spencer's Fresh formats and

Music World outlets, covering about six lakh sq.ft of

retail space, RPG Retail is expected to register a turnover

of INR 4.5 billion.

1.8.7 Viveks- The Unlimited Shop

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Vivek Limited is a professionally managed public limited

company carrying three retail brands -Viveks, Jainsons,

Premier and continuously adding to the formidable

strength of 1000 employees. Vivek Ltd is the largest

consumer electronics & home appliances retail chain

in India. Viveks popularized several brands by creating

visibility and have the distinction of being market leaders

and trendsetters with continuous support from the

principal companies. Viveks evolved its strategies to

suit the larger scene where there was a stigma attached

to borrowing. Very few hire purchase options were

available and hence Viveks started Vivek Hire Purchase

and Leasing Ltd to finance consumer durables, which

enhanced the core retailing business also.Viveks

streamlined the marketing and advertising activities and

shopping ambience was improved.

1.8.8 .METRO - CASH & CARRY INDIA

METRO Group today, is the third largest trading and

retailing group in the world. The company employs over 2,

50,000 staff in 30 countries. In the year 2005 METRO

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Group had generated sales of over €55.7 billion; 53% of

total sales came from outside Germany. METRO Cash &

Carry started operations in India in 2003 with two

Distribution Centres in Bangalore. With this METRO

introduced the concept of Cash & Carry to India. These

Centres offer the benefit of quality products at the best

wholesale price to over 150,000 businesses in Bangalore.

METRO offers assortment of over 18000 articles across

food and non food at the best wholesale prices to business

customers such as Hotels, Restaurants, Caterers, Food

and Non-food Traders, Institutional buyers and

professionals. Metro’s Cash & Carry business model is

based on a Business to Business (B2B) concept and

focuses on meeting all the needs and requirements of

business customers. It is a modern format of

wholesale trading, catering only to business customers.

1.8.9 Aditya Birla-MORE

The Aditya Birla Group is India's first truly multinational

corporation. Global in vision, rooted in values, the Group is

driven by a performance ethic pegged on value creation for

its multiple stakeholders. A US$ 24 billion conglomerate, with

a market capitalization of US$ 23 billion and in the League of

Fortune 500, it is anchored by an extraordinary force of

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100,000 employees belonging to over 25 different

nationalities. Over 50 per cent of its revenues flow from

its operations across the world.” Our mission is to change the

way people shop. We will give them more.” says Mr. Kumar

Mangalam Birla, Chairman, Aditya Birla Group. The more

for you advantage: more. Promises a world-class pleasurable

shopping experience to Indian consumers in their very own

neighborhood more. Quality, more, variety, more convenience

and more value are the four delivery cornerstones of the more

chain of supermarket stores.

1.8.10 Bharti -Wal-Mart

Bharti Retail (Pvt.) Ltd. unveiled the roadmap for its retail

venture on 19th February, 2007 envisaging an investment of

$2.5 billion with expectation of revenue of $4.5 billion (about

Rs. 20,000 crore) from this business by 2015. The first retail

outlet is expected to open somewhere in the month of August

.Bharti’s plan is to invest $2.5 billion by 2015 and open

stores across all major cities. This investment would be only

for setting up front-end stores. The modalities for its back-end

linkage, including its joint venture with the world's largest

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retailer Wal-Mart, are in the process of being worked out. A

high-level team from Wal-Mart was visited India in the later

part of February to work out the details of the back-end chain.

While Bharti would manage front-end of the retail venture,

Wal-Mart would be involved in the back-end, including

logistics, supply chain and cash-and-carry, he added.

1.6.11Reliance Retail

Reliance Retail, Ltd. is a subsidiary company of Reliance

Industries. Founded in 2006 and based in Mumbai, it is the

second largest retailer in India. Its retail outlets offer foods,

groceries, apparel and footwear, lifestyle and home

improvement products, electronic goods, and farm

implements and inputs. The company’s outlets also provide

vegetables, fruits, and flowers. It focuses on consumer goods,

consumer durables, travel services, energy, entertainment

and leisure, and health and well-being products, as well as on

educational products and services.

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On June 26, 2006, Mukesh Ambani, Chairman and

Industries Limited, announced an Rs 25,000-crore investment

in the retail sector. Reliance Retail started its retail operation

with “Reliance Fresh”, a grocery store that sells vegetables,

fruits, personal care items and other food products. Soon, these

retail outlets will also be selling apparel and footwear, lifestyle

and home improvement products, electronic goods and farm

implements and inputs. They will also offer products and

services in energy, travel, health and entertainment. In addition

to this, partnerships would be developed to bring the best of

global luxury brands to India as well.

Reliance Retail plans to extend it’s footprint to cover 1,500

Indian cities and towns with outlets of a varied format, a mix

of neighborhood convenience stores, supermarkets, specialty

stores and hypermarkets. Reliance also plans to open

restaurant outlets, financial services marts and tourism

counters within its stores. Mukesh Ambani’s ultimate ambition

seems to be to create the Indian equivalent of Wal-Mart by

scaling up the business to unprecedented heights to reach

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every nook and corner of the country. With its retailing

venture, Reliance expected a revenue target of US $20 billion

through its retail operations by 2010. Over a span of five

years, RRL expects a 20% return-on-investment. The first

store christened “Reliance Fresh” opened in November

2006 at Hyderabad. Within a few months they have now

opened stores in Mumbai, Pune and Ahmedabad and plans

foray into other cities on a rapid scale Managing Director,

Reliance.