Indian Retail Industry

Presented by: Ravindra

Timeline of Retailing in India Source: Citigroup Research .

GDP growth and Retail Retail. GDP growth Organized Retail in 2010 .

Organized Vs Unorganized Retail Sector  Organized Retail Sector  Unorganized Retail Sector .

Market Share Market Growth Challenges . Unorganized Retail Sector Traditional form of retailing Mom n Pop stores. hand cart.Organized Vs Unorganized Retail Sector Factor Definition Examples Organized Retail Sector Modern form of retailing Hypermarket. aggressive expansion etc. Retail chain etc. pavement vendors etc 97% 6% Use of labour intensive technology. 3% 35% Poor supply chain management. lack of government support etc.

The organized players  Indian companies            Foreign Players     Future Group Reliance Retail Bharti Shoppers'Stop Pyramid Aditya Birla Group Subhiksha Spencer Group Tata ± Westside. Tata ± Chroma Nike (Single brand) Levis (Single brand) Wal-mart (JV) Metro (Cash&Carry) .

5 mn sq. All India space. home solutions. Various segment including food & grocery. Health & Beauty product etc. expecting to reach 30 mn by 2010. Recent Innovations include e-commerce µHybrid Format of µSmall shops    . consumer electronics.000 people.ft.Pantaloon Retail  Headquartered in Mumbai 450 stores across the country employing more than 18.

retail space with turnover of 6.52.000 sq.Raheja Group  First Departmental store in India. MOU with Home retail group of UK Plan to establish network of 55 hypermarkets across the country with sales turnover of US$ 100 million by2010.ft. Home stop etc.75 millions Crossword. Mothercare.      . SHOPPERS STOP Member of IGDS 7.

expecting sales of Rs.Reliance Retail  More than 300 Reliance fresh store and first Reliance Mart hypermarket in Ahmedabed Expansion in two tier cities like Vijaywada.30. Pune.000 cr by 2010   . Ludhiana etc Investment of Rs.000 cr to set up new formats of retail .90.

5 mn sq.ft.subsidies of Tata group operates Westside and Star India Bazaar. of space in the next 12 DLF malls   . Croma Plans to pen more than 27 stores across its retail formats adding 1.Tata Retail Group  Established in 1998 Trent.

Van Heusen.Madura Garments Owned Brands like Louis Phillipe. Pune & other two tier cities    .8000-9000 cr in the first 3 years till 2010 ³MORE´ range of 15 supermarkets open at Nashik. Allen Solly.Aditya Birla Group  Strong presence in apparel. Peter England Investment plan ± Rs.

Organized retail and volume growth Total size of retail Size of organized retail $300bln $8bln 3% % share of Organized retail Source: Economics times retail knowledge series .

building scale to achieve cost efficiencies will be critical . Stores Main challenge to mom and pop stores How to compensate for facilities that mom and pop stores provide namely Home Delivery and Monthly Credit ? Immense Competitions. limited competition Entrenched in Indian Mindset Score on shopping experience Stress on branding Price not critical as they cater to upper income class Well Hypermarkets new concept. but already as big as department stores Growing fast. but competition to intensify Price Discount and Wide Varieties act as key attractions Key to success will be efficient Supply Chains and Store locations Relatively Supermarkets and Conv.Major Retail Formats Department Stores established.

Trinethra   Source: India Retail Report. Merrill Lynch . Lifestyle. Pantaloons Hypermarkets: Big Bazaar. Stores: Subhiksha. 2007. Spencer Supermarkets and Conv.Market Profile of Various Formats  Department Stores: Shopper Stop.

Government Policies  51% FDI allowed in single-brand formats 100% FDI in cash-and-carry format NO FDI in multi-brand stores ( like Wal-Mart) Trends indicate that the FDI would open up in retail sector. however political consensus has to be reached before that happens    .

Higher Incomes Favorable Demographics Changing Lifestyles and Preferences Real estate boom Manufacturing Reforms Reduction in import dutiesoffering .Growth Drivers & Barriers Growth Drivers Consumption Barriers to Entry Regulatory barriers  Fragmented Suppliers  Lack of infrastructure  Supply Chain Complexities  Lack of skilled Human Resource  Differential Taxation System  Labor Legislation  Clustering of Malls  Boom.

patient capital should survive but weak players likely to exit in the near term Consolidation is on the cards Driven more by traffic growth than ticket growth Convenience stores to remain integral part of retail Need for catering to local flavors Internet retailing still to pick up in India .Outlook and challenges         Strong long-term growth potential Severe cost pressure largely related to property rentals Profitability likely to remain low .

the world¶s largest retail company. plans capital spending of 2.Heard from the street««  Four years after announcing its wholesale joint venture with Bharti Enterprises. Aditya Birla Retail. which runs stores under the More brand.5 billion rupees ($55.  . is still waiting for the multi-brand retail sector in India to open for foreign direct investment (FDI).3 million) during the fiscal year that ends in March 2012. Walmart.

Walmart in talks to pick up stake in Future Group's Big Bazaar  . Retail chain Shoppers Stop today said it may increase prices of its products by 6-7 per cent from April this year in order to offset the 10 per cent excise duty imposed on branded apparel in the Budget 2011-12.

THANK YOU .

Master your semester with Scribd & The New York Times

Special offer for students: Only $4.99/month.

Master your semester with Scribd & The New York Times

Cancel anytime.