Retailing and Organized Retailing

Retailing is defined as the sale of goods or commodities in small quantities directly to consumers. Organized retail or modern retail is usually chain stores, all owned or franchised by a central entity, or a single store that is larger than some cut-off point.

Phases in the evolution of retail Sector

Classification of organized retail evolution in India

Initiation Pre 1990s Conceptualization 1990 2005 Retail Expansion 2005 through 2010 Consolidation and Growth 2010 onwards

Market segments in India

Worldwide food &grocery Retail Sales

Favorite Destination for Retailers in India

Key drivers for growth of organized food retailing

Increasing need for convenience Availability of quality retail space Higher disposable income Demographic changes Economic growth Growing working women population Growth in urban population

Technological advances Electronic media Rise in the use of plastic money

Key impediments for organized food retailing

Lack of infrastructure and technology Lack of capital Large transactions Low price strategy Indian consumer behaviors Location Fraud in retail is expensive

Retailing formats in India

Malls Specialty Stores Discount Stores Large Stores Departmental Stores Hyper marts/Supermarkets Convenience Stores Multi Brand outlets

Impact of Organized Retailing

on Unorganized Retailers on Consumers on Intermediaries on Farmers on Manufacturers

Decadal Analysis of the Food Retail Sector

Supply Side Demand Side

Current FDI Policy- Implications

Requirement of State permission Identifying states for FDI investment Any additional State conditions for allowing/approving FDI/s Minimum FDI of Rs. 450Cr and maximum stake of 51% Availability of Indian partner/s to enter into joint ventures Willingness of Indian partner/s to invest at least `432Cr

Current FDI Policy- Implications

30% manufactured products should be sourced from SME Margins and quality of products sourced from SMEs Reactions of consumers for products from SMEs FDI is likely to be permitted only in the six big metros Current competition landscape in the six metros Availability and price/rentals of prime locations for multibrand retail outlets in the six metros

Emerging Trends
Likely Transformation of the Supply Chain Supplier Retailer Relationships Innovations in Transportation Logistics Formats Social Trends Online Retailing Impact of Technology Food Safety Issues

Entry of MNCs
Wal-Mart Carrefour Costco Wholesale Corp Tesco

Major Players - Indias Top Food Retailers

Major Players - Indias Top Food Retailers

Conclusion
Shift in the consumption and buying behaviour Consumers are looking for value options which are increasingly becoming price plus Need-based products face the risk of rapid commoditization. Positive broad-basing of economic activity in India