RETAIL INDUSTRY

PRESENTED BY:- RITA PATILSHIVAJI

What is Retailing?“Retailing- includes all the activities

involved selling goods or Services directly to final consumers for personal use, not for business use”.

Evolution of Retail Industry Traditionally retailing in India can be traced to -

• Weekly Markets Village Fairs & Melas.

• The emergence of the neighborhood ‘Kirana’ stores catering to the convenience of the consumers

• Era of government support for rural retail: Indigenous franchise model of store chains run by Khadi

& Village Industries Commission

• The latter half of the 1990s saw a fresh wave of entrants with a shift from Manufactures to Pure Retailers.

• Emergence of hyper and super markets trying to provide customer with 3 V’s - Value, Variety and Volume

4

Weekly MarketsVillage FairsMelas

Convenience Stores/Kiranas

Khadi & Village StoresCooperatives

Exclusive Brand OutletsHyper/Super MarketsDepartment StoresShopping Malls

Traditional/Pervasive Reach

Government Supported

Historic/Rural Reach

Modern Formats/ International

Evolution of Indian retail

Source of Entertainmen

t

Neighborhood Stores/Convenie

nce

Availability/ Low Costs / Distribution

Shopping Experience/Efficie

ncy

*

TYPES OF RETAIL MARKET

Organized market Unorganized marketProfessionally managed has

a accounting transparency with proper usage accounting standards.

These include the corporate backed hypermarkets and retail chains.

Owner lacks technical & accounting standardization.

For example, owner manned general stores, convenience stores, handcart,

Kiranas store.

Unorganized Retail Market Market size - 92% It includes owner managed general store, convenience

store, kirana store Location – Residential area, Main roads Lacks technical and accounting standard Space limitation

Shift from Unorganized to Organized self service outlets

Changing Scenario

BEFORE AFTER

Organized Retail Market Market size - 8%(rapidly growing) It includes Larger malls, Retail chain, Supermarket Professionally managed with accounting standard Customer are mostly brand conscious and use lifestyle

products Customer are shifting from buying to shopping

experience No space limitation

Reasons for preferring retail:• Customer convenience• Availability of choice (price, product)• Space and design convenience• Long term relationship

Type of products in retail industry : Retail is classified based on products type:Food products: cold storage facility is required.Durable goods : These goods do not get weared out quickly.

( electronic goods, furniture, sporting goods)Soft goods: These goods consists of limited period of usage. ( clothing, apparel and other fabrics)

KEY PLAYERS IN INDIATata groupRelianceRPG RetailLandmark groupFuture group• Shoppers' Stop• Westside (Trent) • Pantaloon (Big Bazaar) • RPG Retail (Food world, Music world) • Crossword • Wills Lifestyle • Globus• Piramals ( Pyramid & Crosswords) • Ebony Retail Holdings Ltd.

Global Top 10 Retailers World WideRetailer Home Country

Wal-Mart StoresCarrefour GroupThe Home Depot, IncThe Kroger Co.Royal AholdMetro AGTarget CorporationAlbertson’s,Inc.Sears, Roebuck and Co.Kmart Corporation

USAFranceUSAUSANetherlandsGermanyUSAUSAUSAUSA

PEST AnalysisPolitical analysis1995- General agreement by world trade organization’s on

services in the trade which include the both wholesale and retailing services.

In 2011, FDI in single brand retail permitted to 100%In 2012, September , FDI in multi brand retail permitted to 51%Government argument :Huge amount of investment will increase employment

opportunities.Help farmers by eliminating middlemen.Local players may learn the effective supply chain efficiencies

from foreign retail.

Economic analysisIndian retail sector cover the 14-15% of the GDP.Indian retail market stands in the top five retail market in

the world.Benefits to farmers-7-10% higher price as compare to Mandi3-4% incentive if they produced good quality goods.Increase the standard of living.

Social analysisProvide employment on large basis from lower level to

top management.Prices of good will be much affordable.Better quality products.Better service.Companies should purchase most of its good from local

markets rather than outsourcing. Increase in InfrastructureFulfilment of unemployment gap

Technological analysis

•Foreign companies will bring best technologies to increase their productivity and profit.

•They have a direct touch with farmers and trained them for new technologies

•Farmers are getting trained freely with new technologies

SWOT Analysis STRENGTH• Products are cheaper

than the market price.• Technology intensive

industry• Variety in products• Demographic Presence• Rising disposable

income• Urbanization• Shopping convenience• Low skilled labor cost

Weakness• Has not yet trapped the

whole market.• Facing problems due to

political environment• Customer loyalty• Limited consumer insight• Inadequate human

resources• Underdeveloped supply

chain• Lack of adequate facilities

OPPORUNITY• Kids and teens are

moving towards retailing segment

• Rural retailing• Sectors has high

growth potential• Locational

advantage• Falling real estate

cost• E-retailing• Franchising

THREATS• Shopping culture• Political issues• Social issues• Lack of

differentiation among the malls that are coming

• Poor inventory turns and stock availability measures

Problems &Challenges for Retail in India1. The organized retail industry in India is facing

competition from the unorganized sector.2. Intensifying competition is exerting downward

pressure on prices.3. The industry is facing a severe shortage of talented

professionals, especially at the middle-management level.

4. Lack of Supply chain management.5. Lack of adequate infrastructure like power,

transport, communication6. Lack of Finance- Due to lack of finance to a existing

and new players. This affects growth and expansion plans.

7. Requirement of numerous license, permits and registration

ConclusionIndian Retail industry has a huge room for

development and very bright future prospect.

Proper government measure can assure healthy growth.

Indian Retail Industry helps to grow Indian economy in terms of income and employment generation.