Indian Retail Industry

Presented By:-Deepti MahraAmar Kanti

RETAIL INDUSTRY IN DYNAMIC BUSINESS ENVIRONMENT

What is Retail??

Retail Philosophy — “By The People, For The People and Of The People”

Retailing involves selling products and services to consumers for their individual or family use. As the final link between consumers and manufacturers, retailers are a vital part of the business world. Retailers add value to products by making it easier for manufactures to sell and consumers to buy.

The Indian Retail Sector can be broadly classified into—

Corporate Houses Tatas: Tata Trent, Croma RPG group: Food World, Health and Glow, etc ITC: Wills Life Style Rahejas: ShoppersStop

Dedicated brand outlets Nike, Reebok, Zodiac etc

Multi-brand outlets Vijay Sales, Viveks etc

Manufacturers/ Exporters Pantaloons, Bata, Weekender

Categories of Indian retailCategories of Indian retail

Big Bazaar Giants Shoprite Star Lifestyle Pantaloons Piramyds Shoppers Stop Trent

Entertainment Fame Adlabs Fun Republic Inox PVR

Large Indian retailersLarge Indian retailers

Major players Major players

Source:-www.Naukrihub.com & Economic Times

Tremendous OpportunitiesChanged behavior pattern of Indian consumers.Now the Indian consumer gets more hefty pay- packages; is younger, a large number of women are working, western influences, and more disposable income have opened a lot of opportunities in Indian organized retail sector. The Indian consumer wants to shop, eat and get entertainment in one place and is have also given Indian organized retail sector an opportunity to grow.

There are about 300 new malls, 1500 supermarkets and 325 departmental stores currently under construction.

Attributes driving Indian Retail Industry

The certain points which can be taken under consideration: • Economic prosperity • Rising incomes • increased per capita spending • rapid urbanization • Improved infrastructure • liberalization of the Indian economy • Flourishing manufacturing and services sectors

• Market is larger than ever and drawing both global and local retailers.

• Foreign direct investment (FDI) inflows as on January 2009, in single-brand retail trading, stood at approx. US$ 25.18 million, according to the Department of Industrial Policy and Promotion (DIPP).

India is ranked 5th in the A.T Kearney Global Retail Development Index

Second only to China in Asia

India ranked 3rd in the Global A T Kearney FDI Confidence Index in 2004

Least saturated of all global markets studiedThe least competitive of all global markets studied

Implies lower barriers of entry for global players Considering tremendous market size, excellent potential for foreign players

The Indian advantage

Demographic FactorDemographic Factor

Started a month earlierOnam,Ganesh Chaturthi in AugustIt’ll be followed by Dashahra and Divali(when corporate and personal gifting will be on top along with apparels) & The year is going to be wrapped up with Christmas and New Year celebration

Demographic FactorDemographic Factor

Income in rural households comes twice a year when the crops are harvested but the expenditure is spread across the year. And if along with this cruel picture monsoon also plays with them the situation has to be ponder over.And the same happened when India faced draught this year.The agriculture witnessed a growth of mere 1.2% as compared to 4.1% in 2008.

Economic FactorEconomic Factor

The first half of 2008-09 was quite okay. But then global meltdown coupled with stock crash brought growth to a halt from the third quarter last year.Shoppers Stop alone witnessed a drop of 20% in footfalls last year.This average for whole retail industry was 15-25%

Source:- Economic Times

Some political parties want the government to amend laws and improve curbs so that the mega players can't openlydecimate the unorganized retail sector. This is a conclusion based on a myopicoutlook and must be amended for a long term strategy. The fear is baseless. The mega stores will no doubt provide employment to the less educated masses. Also taking business away especially from small food vendors is more easily said than done. Instead the limiting move will send wrong signals to the investors and will ward off investments when the states need it most. Allowing percent retail FDI in this sector is a welcome move in this direction,but again this should move ahead. It is expected that the government will create further opportunities for the organized retail to come up.

Hindrances from government

Political EnvironmentPolitical Environment

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Narega and high support prices for key crops had improved the purchasing power of rural consumers. many such schemes will improve the penetration power of rural market. And government is going for it.

Political EnvirnmentPolitical Envirnment

(National Rural Employment Guarantee Scheeme)

(Investment of Rs.20,000crore & 150 workdays)

(PM announcement of 20km road per day)

Future Prospects of retail Industry

• The next phase of growth is expected to come from rural markets, with rural India accounting for almost half of the domestic retail market, valued over US$ 300 billion.

• Rural India is set to witness an economic boom, with per capita income having grown by 50 per cent over the last 10 years, mainly on account of rising commodity prices and improved productivity.

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