Veena Mathur
Advisor-Speciality
Polyethylenes Marketing &
Business Development
Reliance Industries Ltd.
The Indian retail sector is going
through a dramatic change.The
neighbourhood kirana shops
selling basic commodities in loose or
poorly packed form, are making way
for organized retail. A silent but rapid
transformation is taking place. Shopping
complexes, speciality malls and
large mall complexes offering a very
wide range of goods, services, entertainment
and food are coming up.
Challenge and Opportunity
What is the basic requirement of all
goods sold in the malls – PACKAGING.
At present the organized sector
holds only a miniscule 1.2% of the
current US$ 245 billion retail business
in India, but this is expected to explode
to US$ 385 billion in the next 3 – 5
years.
The change in the social formats
has led to the development of modern
retail outlets. Demand of the Indian
consumers for quality products at the
right price and environment with the
perfect service and ambiance is fueling
the growth of the Indian retail industry.
With consumers looking at
convenience with multiplicity of
choice under one roof and expectations
evolving over time, consumer
demand is truly the driving force for
organized retailing in the country.
Food and beverages form the main
chunk of the retail market followed by
apparel, footwear and electronics.
The retail sector has thrown up a
wide range of opportunities for Indian
agribusiness on account of increased
popularity of food retailing in an organized
manner.
The emergence of organized sector
retail chain stores and a rise in competition
is likely to be a catalyst for
bringing about much needed reforms
in the agriculture-related supply chain.
The large players in the retail sector
and fast moving consumer goods are
also influencing the government to liberalize
the regulations, which hitherto
have constricted the operational environment.
In addition, political pressure
is rising, invoking a response from
the government to change the regulations
so as to enable farmers to operate
more productively. The new environment
should help boost productivity
growth and per capital income
in the rural economy, where almost
70% of the Indian population resides.
Retail Models in India:
Current & Emerging
The Indian food retail market is
characterised by several co-existing
types and formats. These are:
* The roadside hawkers and the mobile
(pushcart variety) retailers.
* The kirana stores (the Indian
equivalent of the mom-and-pop
stores of the US), within which are:
Open format more organized outlets
or small to medium food retail
outlets.
Within modern trade (organized),
we have:
* The discounter (Subhiksha, Apna
Bazaar, Margin Free)
* The value-for-money store
(Nilgiris)
* The experience shop (Foodworld,
Trinethra)
* The home delivery (Fabmart)
....contd.
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