This presentation is on Retail Sector in India after Globalization...SWOT Analysis is also shown

1. Globalization & Retail Sector
By-P1103
P1125
P1146
P1152
P1157

2. Globalisation
– An economic phenomenon
– A social phenomenon
– A cultural phenomenon

3. Globalisation

4. Benefits of Globalisation
 Increased choice
 Greater potential for growth
 Increase international
economies of scale
 Greater employment
opportunities
 Massive increases in wealth
for many countries

5. Disadvantages of Globalisation
 Increase in gap between the
rich and the poor
 Dominance of global trade
by the rich, northern
hemisphere countries
 Lack of opportunities for the
poor to be able to have
access to markets
 Exploitation of workers and
growers

6. Retail Sector
• Goods and Services(Marketing Intermediary)
• 14% GDP
• 2nd Sector
• 5th in World
• 2nd in Asia

7. Different products involved in Retailing
Food
Books & Magazines
Fashion & Clothing
Personal Care
Electronics
Sport & Leisure
Home Ware
Footwear & Leather
Toys & Games
Jewellery & Watches
Furniture
Petrol

8. Division of Retail Sectors
• Organized
• Unorganized

9. Manufacturers
Whole seller
Organized Sector
Distributor
Retailer

10. Organized Sector
Super markets
(Low Price and Low margin basis)

11. Organized Sector
Hypermarkets
(Food and Non-food things)

12. Organized Sector
Departmental stores
(Retail outlets)

13. Organized Sector
Specialty stores
(Books and Sales of Music Cassettes)

14. Unorganized Sector

15. Customers
Bargain Hunters Casual Shoppers
Devoted Customers

16. Share of Organized Retail

19. International Retail: At a Glance
3% 2% 9%
8% 38%
13%
27%
USA EU Japan China
India Russia Others

20. Government Policies
 The retail industry in India is growing at a significant pace. However, there are
several problems faced by the industry. The major challenges for the
organized sector include:
 Taxation laws that favor small retailers.
 Multi-point octroi collection.
 Indian retailers need to emulate worldwide retail practices such as
accuracy in financial reporting, increased levels of corporate governance
and greater accountability among employees.
 Foreign Equity does not go beyond 51 percent.
 Additions to the product categories to be sold under ‘single brand’ require
fresh govt. approval.

21. Why FDI?
 Improve competition
 Develop the market
 Greater level of exports due to increased
Benefits of sourcing by major players
FDI
 Sourcing by Wal-Mart from China improved
multifold after FDI permitted in China
 Similar increase in sourcing observed for
Metro in India
 Provides access to global markets for
Indian producers

22. Why FDI?
 Investment in technology
 Cold storage chains solve the perennial problem
of wastage
 Greater investment in the food processing sector
Benefits of technology
FDI  Better operations in production cycle and
distribution
 Better lifestyle
 Greater level of wages paid by international
players usually
 More product variety
 Newer product categories
 Economies of scale to help lower consumer price
 Increased purchasing capacity of consumers

23. How FDI ?
 FDI should be allowed in stages
2 yrs
 Initial stages: 26% FDI
 Establishment Phase: 49% FDI 2 yrs
How FDI ?
 Mature Phase: 100% FDI 2 yrs
 FDI policy
 No incentives needed to attract FDI
 Market size and potential are sufficient
inducers
 No need for costly tax breaks, import duty
exemptions, land and power subsidies, and
other enticements

24. SWOT Analysis

25. Strength
 Increasing demand
 Because of increase in per capita income
household consumption also well increase
 WIN-WIN situation for all
( suppliers, producers, retailers and customers).
 Improvement in the standard of living.
 Technology intensive industry

26. Weakness
 Lack of expertise in Supply Chain Management
 Inadequate Infrastructure
 Labor Laws
 Lack of specialized professionals in Industry
 Lack of industry status.
 Government Restrictions on FDI
 Non-Availability of Government Land

27. Opportunities
 Change in consumer behavior pattern and increase
in disposable income
 More than 15 million people would be engaged in
Retail Industry by 2015
 Indian rural markets offer a sea of an opportunity
for the retail sector
 Upcoming international Players
 Healthy prospect for the fashion industry

28. Threats
 Indian taxation system favors small retail
business.
 Competition from unorganized Sector to the
organized Sector.
 Middle class Psychology.
 Increasing Real Estate prices