organised retailing

Presented By,Poovanna B S

R&SCM

ORGANIZED RETAILING IN INDIA

Retailing may be defined as, “The sale of goods or commodities in small quantities directly to consumers.”

RETAILING

The Indian Retail Industry is the fifth largest in the world. Comprising of organized and unorganized Sectors.

Indian retail industry is one of the fastest growing industries in India, especially over the last few years.

Initially the retail industry in India was mostly unorganized, however with the change of taste and preferences of consumers, the Industry is getting more popular these days and getting organized as well.

The Indian Retail Industry is expected to grow from US$330 billion in 2007 to US$640 billion by 2015.

RETAILING IN INDIA

Indian Retail Market accounts for 22% of country’s GDP and it contributes to 8% of the total employment.

According to the 10th Annual Global Retail Development Index (GRDI) of A.T. Kearney, India is having a very strong growth fundamental base that’s why it’s the perfect time to enter into Indian Retail Market.

The total retail spending is estimated to double in the next five years. Of this, organized retail –currently growing at a CAGR of 22%- is estimated to be 21% of total expenditure.

The unorganized retail sector is expected to grow at about 10% per annum with sales expected to rise from $309 billion in 2006-07 to $496 billion in 2011-12.

MARKET OVERVIEW

REF: IBEF REPORT ON RETAIL ,DATED NOVEMBER 2010

Hypermarkets - Spencers, Big BazaarCash & Carry- Easy Day, MetroDepartment stores- Lifestyle, Shoppers StopSupermarkets- Food BazaarShop in Shop- Infinity Specialty Stores- Brand factoryCategory killers- The Loft, CentralDiscount Stores- SubhikshaConvenience Stores-Safal, In& Out

ORGANIZED RETAIL FORMATS

Emergence of Multiple franchisee ModelRural retailingJV’s for International productsVertical IntegrationCollaboration for back-end resource sharingIncreasing Market ReachInnovation in new retail formatsDirect Sourcing & Private Labels

KEY TRENDS

Expansion PlansM&AStrategic AlliancesPolicy and Regulatory FrameworkGST

INVESTMENTS IN ORGANIZED RETAIL

STRENGTH

Increasing demand driven by the country’s young working population

Increase in per capita income which in turn increases the household consumption

Create win-win situation for all links in value chain ( suppliers, producers, retailers and customers).

Improvement in the standard of living.

Technology intensive industry

WEAKNESS

Lack of expertise in Supply Chain Management

Inadequate Infrastructure

Stringent Labor Laws

Lack of specialized professionals in Industry

Lack of industry status.

Non-Availability of Government Land.

Change in consumer behavior pattern and increase in disposable income.

It is estimated that 15 million people would be engaged in Retail and Retail support activities by 2010

Indian rural markets offer a sea of an opportunity for the retail sector.

Upcoming international Players

Healthy prospect for the fashion industry.

OPPORTUNITIES

Indian taxation system favors small retail business.

Competition from unorganized Sector to the organized Sector.

Middle class Psychology.

Increasing Real Estate prices

THREATS

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