Retail Scene in India: An Overview and Opportunities

Dr. Mandeep Singh

Ravneet Kaur Bindra

Booming Economy of India

Current GDP - 8.8 % Expected Growth- 10%

Indian Retailing Industry

GDP contribution- 10% Expected growth- More than 27%

Provision of Employment- 8%
Current Sizeapprox.) USD 427 Billion (18,00,000 crores

Purchase Power Parity- 4th largest in the world (US,

Japan and China)

RETAILING:
The term Retailing refers to any activity that involves a sale to an individual customer. Retailing is the interface between the producer and the individual consumer buying for personal consumption.
Retail

Organized
(Less than 10 employees)

Unorganized
(More than 10 employees)

Phased Growth of Indian Retail Market

2010 Continued Growth. Expected growth- USD 427 billion Retail boom is at peak. This phase is termed as High Gold Rush Maintaining its #1 position. Indian retail market grew to USD330 billion Beginning of indian Retail Boom. Ranked as #1 market for Global retailers to enter

2008

2007

2006

2003

Standing at USD 230 billion, enters the Growth phase, characterized by Entry of New Domestic and International participants and Expansion by existing retailers in India.
Indian Retail market classified as the Emerging Market

1995

Stages of Growth Retail Market

Opening
(Beginning)

Closing
(less opportunity, High penetration of modern Retail, discount models & Non-food formats)

Peaking
(Developing)

Declining
(Still big and Growing, tighter for new entrants)

Stages of Retail Market

Kazakistan,2006 India,1995 China,1995
I Opening (Market in the initial state of Retailing) II Peaking (ready for modern Retail)

India,2006 China,2003 Russia,2005 Vietnam,2006

IV Closing

III

(Market with high penetration of modern retail)

Declining
(Tighter space for New entrants)

Hungary,2006

China,2006

Key Trends and Drivers of Retail Growth

Rapid Economic Growth The Young India Potential Untapped Market Cost Effectiveness Changing Face of Indian Consumerism Increasing Urbanization Easy Availability of Credit Increasing Technology Adoption

Rapid Economic Growth

Leads to Indian Consumerism High disposable Income Fastest growing economy Expected Growth rate- 10% Private Consumption- 62% of Indias GDP in 2008-09

The Young India

Largely Young Population Age structure

1564 years: 64.3% 014 years: 35% 65+ years: 4.9%

Median age- 23 years 2/3rd of population is under 35 years
,

Potential Untapped Market

Pantaloon Retail India Limited- 0.3 %of total Indian market Tesco Plc14.3% of Englands market Walmart20 per cent of USAs market Insight into the large untapped market potential. Organized and Unorganized retail sector

Cost Effectiveness
Singapore
Korea 10743 3429 2705 2450 1192 1000 729 0 5000 10000 15000 20000 25000 Series 1 21317

Countries

Malaysia Thailand Philippines India Indonesia China

Value US$ per annum

Changing Face of Indian Consumerism

Favorable Demographics High Disposable Income Redefining Lifestyle patterns- western values, brand
consciousness

Thriving Service sector Kirana shopping Mall Hopping Availability of Domestic and International Brands

Increasing Urbanization
Urban Population 2001- 286 million 27.8% of total population, 1029 2010- 468 million (approx.) 33.4% of total population, 1400 million (approx.) Indias urban population is 2nd Largest in the World. Increase in young employed exec. and Women employees stimulating growth of retail.

Easy Availability of Credit

Credit Cards and Debit Cards subscription
Change in consumer habits Preference of Plastic Money issued credit cards- 16.6 million in 2005-06 Annual growth rate- 28% since then

Loan Service Offering

Increasing Technology Adoption

Information Technology Tool- supply chain,
warehousing and logistic requirement

Retail sector contribution to IT- 8% in 200506

IT solutions

Contd..
Saving Spending Consumer Exposure to Latest Trends

Conclusion
Increased Productivity (Goods and services) Reliance on Retail sector as a locomotive of growth Largest among all industries (10% of GDP, 8% of
emploment) Dynamic and fast paced (several players entering)

Gradually inching its way

Thank you..