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Rural retailing


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Rural retailing

  2. 2. About Retailing  Retail is the sale of goods and services from individuals or businesses to the end-user.  Retail comes from the Old French word tailler, which means "to cut off, clip, pare, divide" in terms of tailoring (1365).  It was first recorded as a noun with the meaning of a "sale in small quantities" in 1433
  3. 3. Evolution of retail in India
  4. 4. Retail in India  India is a leading destination for retail investment  Efficient logistics and supply chain is one of the key factors for success.  Retail sector proves to be a backbone to a host of allied sectors (eg.: agriculture, logistics etc).  Organised retail sector – 3%  Unorganised retail sector – 97%
  5. 5. Rural Markets-Overview  70% population lives in villages  About 66,000 villages are in India  Rural retail are growing @7%  A real source of energy  Hub of raw materials
  6. 6. Scope of Rural retailing  rural retail market — currently estimated at $112 billion, and growing at around 10 percent of the size of the Indian GDP.  The size of FMCG industry in India at Rs.200, 000 crore. Out of this, domestic consumption accounts for Rs.17, 189 crore.  "FMCG sector in rural areas is expected to grow by 40 per cent compared to 25 per cent in urban areas.  Rising rural incomes, healthy agricultural growth, boost in demand, better penetration of FMCG products in the rural market are contributing to high growth and rapid expansion of the FMCG industry in rural India.  " As far as the auto sector is concerned, the rural market has been largely accepted to tractors and two-wheelers
  7. 7. Consumption Contribution of Rural India Consumption contribution Rural Urban Soft Drink 46% 54% Cigarettes 59% 41% Consumer durables 59% 41% FMCG 53% 47% Motorcycle 49% 51%
  8. 8. Cont…
  9. 9. Challenges in rural Retail  Large number of small markets  Human Resource  Poor road connectivity  Poor availability of suitable dealers  Inadequate banks and credit facilities  Poor storage system  Low investment capacity of retailers  Poor visibility and display of products on rural shop shelves.
  10. 10. Opportunity in rural retail  Developing new markets  Increasing disposable income  Increasing per capita income  Large population  Higher purchasing capacity  Market growth
  11. 11. MODELS IN RURAL RETAILING  HARIYALI KISAAN BAZAAR MODEL Hariyali Kisaan Bazaar was one-stop solution for farmers offering range of products such as farm inputs and FMCG goods among others items with about more than 300 outlets about an years ago.
  12. 12. Cont…  AADHAAR MODEL Aadhaar is a joint venture between The Future Group & Godrej Agrovet Ltd which focuses on retail distribution of and consumer products for personal and household use in rural and semi-urban India
  13. 13. Cont…  E-CHAUPAL: E- Chaupal is the backbone of these rural malls. While the first layer (E-Chaupal ) provides the farmers necessary information about weather and prices, this hypermarket initiative will provide them another platform to sell their produce and purchase necessary farm and household goods under the same roof.
  14. 14. Cont…
  15. 15. What should keep in mind to get success in Rural market? The 4A Approach  Availability  Affordability  Acceptability  Awareness
  16. 16. Conclusion The world is changing like never before. This change is more attributed to the way business practices and strategies are changing across the globe. Business organizations are rapidly changing their domain and strategy to take benefit of this emerging global order. Rural marketing endeavours have to be seen and implemented as investment for better tomorrow. Thus successful company will be one which meets consumer's expectations through products offered at affordable cost and still is in position to earn a decent return on investment because of its strong, efficient and intelligent distribution channel.
  17. 17. Thank you