Evolution of Indian retail• The emergence of the neighborhood Kirana’s stores catering to the convenience of the consumers• Era of government support for rural retail: Indigenous franchise model of store chains run by Khadi & Village Industries Commission• 1980s experienced slow change as India began to open up economy.• The latter half of the 1990s saw a fresh wave of entrants with a shift from Manufactures to Pure Retailers.
Contd……• For e.g. Subhiksha• Post 1995 onwards saw an emergence of shopping centers, mainly in urban areas, with facilities like car parking targeted to provide a complete destination experience for all segments of society• Emergence of hyper and super markets trying to provide customer with 3 V’s -Value, Variety and Volume
Reforms in retail• In January 2012, India approved reforms for single-brand stores welcoming anyone in the world to innovate in Indian retail market with 100% ownership, but imposed the requirement that the single brand retailer source 30 percent of its goods from India.• Indian government continues the hold on retail reforms for multi-brand stores
Contd……• The reform seeks to attract investments in production and marketing• Improve the availability of goods for the consumer• Encourage increased sourcing of goods from India, and enhance competitiveness of Indian enterprises through access to global designs• Technologies and management practices.• This requires single-brand retailer, with greater than 51% foreign ownership, to source at least 30% of the value of products from Indian small industries, village and cottage industries, artisans and craftsmen.• India needs trillions of dollar to build its infrastructure, hospitals, housing and schools for its growing population.
Social impact and controversy with retail reforms• Independent stores will close, leading to massive job losses. So, Small shops should switch to super markets. As India retailers provide good relationships between buyer and seller, loyalty, discounts.• Work will be done by Indians, profits will go to foreigners.• Remember East India Company. It entered India as a trader and then took over politically.
MARKET SIZE• The size of retail industry in an economy depends on many factors and the level of consumer spending is the most important among these factors. The retail sector in India has grown by leaps and bounds in the last five years. The reason behind this growth has been the synergy of many propellants.• the present situation is just a depiction of nascent stage.• The future of the trajectory may not be as steep as it is now or may be even slope downward.
MARKET SIZE (cont’d)• The present value of the Indian retail market is estimated by the Indian Retail Report to be around Rs. 12,00,000 crore.• Annual growth rate is 5.7 percent.• Retail market for food and grocery with a worth of Rs. 7,43,900 crore.• Country’s retail sector share in GDP(%) is 10.
MAJOR PLAYERS• Shopper’s Stop: Shoppers Stop is famous for the expertise and acumen relating to the current practices of the industry. It provides quality services, products and the right kind of shopping environment.• Westside(Trend): Tata Group founded Trent Ltd. (Westside) in 1998. The acquisition of a London-based retail chain Littlewoods by the Tatas was followed by the establishment of Trent Ltd, which was later renamed as Westside.• Future group(big bazaar): Pantaloon Retail is the flagship enterprise of the Future Group. Pantaloon Retail (India) Limited has spread across various businesses and cities in India. Pantaloon owns multiple retail formats and is able to cater to a large section of the society.
• Lifestyle• RPG Retail• Crossword Local players like ITC, the A.V. Birla Group and Tatas have given the hints to enter organised retail. France’s Carrefour SA and Britain’s Tesco too were recently in news for their future plans to explore the Indian retail market.
MARKET SHARE OF THE PLAYERS• Shopper’s Stop: They currently have a 59% stake in Crosswords -- the book and music store.• Lifestyle: While lifestyle accounts for 15 per cent of the consumer’s spend, 60 -65 per cent comes from food and grocery and it is this segment Shoppers is setting its sight on.• Pantaloons(big bazaar):7.1%
MAJOR CHALLENGES TO THE RETAIL INDUSTRY IN INDIA1. THE KIRANAS CONTINUE2. RETAIL NOT BEING RECOGNIZED AS AN INDUSTRY IN INDIA.3. THE HIGH COSTS OF REAL ESTATE4. HIGH STAMP DUTIES5. LACK OF ADEQUATE INFRASTRUCTURE6. MULTIPLE AND COMPLEX TAXATION SYSTEM7. DIFFICULTY TO RETAIN CUSTOMERS8. LACK OF TRAINED WORK FORCE9. TOO BIG TO MANAGE
TOP 10 GLOBAL PLAYERS IN RETAIL INDUSTRY1. Wal-Mart• Country of Origin: US• Countries of operation: 162. Carrefour• Country of Origin: France• Countries of operation: 363. Metro AG• Country of Origin: Germany• Countries of operation: 334. Tesco• Country of Origin: UK• Countries of operation: 135. Schwarz Unternehmens Treuhand KG• Country of Origin: Germany• Countries of operation: 25
6. The Kroger Co.• Country of Origin: US• Countries of operation: 17. Costco Wholesale Corp.• Country of Origin: US• Countries of operation: 98. Aldi Einkauf GmbH & Co.• Country of Origin: Germany• Countries of operation: 189. The Home Depot• Country of Origin: US• Countries of operation: 510. Target• Country of Origin: US• Countries of operation: 1Source: Deloittes Global Powers of Retailing
IMPACT OF GLOBAL CRISIS ON RETAIL INDUSTRY• Markets in recession worldwide• Reduced purchasing power of customers• Downfall in us economy
Retail formats in IndiaMallsDiscount storesDepartment storesHyper markets/supermarketsConvenience stores
Latest trends in domestic retail industryIndustry concentrationBrands under pressureTechnological advances E – commerceGlobal sourcing
Latest trends globally in retail industrySupplier retailer relationshipsInnovations in transportation logisticsFormatsSocial trendsOnline retailingImpact on technologyFood safety issues
PROFILE OF OWNERS/TOP EXECUTIVES Big bazaar• Founder and group CEO: MR. Kishore Biyani• Established : In 1994• Born on: 9th August,1961• Awards: young entreprenuer of the year award• CNBC indian buisness leaders awards 2006• The first generation entreprenuer of the year
Bharti retail limited• CEO and president: MR. Vinod Sawhney• Education : MBA(XLRI Jamshedpur) 1981-83 BE Hons.(Birla institute) 1975-80• Joined Bharti in: Jan 2007 – Jan 2010(3 years 1 month)
Shoppers stop• CEO: MR. B.S Nagesh• Started his career: as sales officer with Blowplast. Post this he worked with Orson electronics as branch manager• Awards: Top CEO award 2001 instituted by institute of marketing management• Most admired apparel retail professinal of the year at the inaugural fashion awards 2000.