TridentGroup unveils its new range of corporate gifts at Giftex 2014
178021 633758384389
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1
Retailing World’s largest private industry
US$ 6.6 trillion sales annually
Indian retailing Largest employer after agriculture -
8%* of population Highest outlet density in world
Around 12 mn outlets Still evolving as an industry
Long way to go
An overview
Retailing: An overview
2
Wal-Mart Topmost global Fortune 500
company(3 Consecutive Years) Annual Sales of over US$ 250 bn India’s two largest retail player
turnover around US$ 158 mn (Bata) and US$ 102 mn (Shoppers Stop)
Fortune 100 9 Retailers Carrefour, Ahold, Home Depot,
Kroger, Metro, Kmart-Sears, Target, Albertsons’
An overview
Retailing: An overview
3
Weekly MarketsVillage FairsMelas
Convenience StoresMom and Pop/Kiranas
PDS OutletsKhadi StoresCooperatives
Exclusive Brand OutletsHyper/Super MarketsDepartment StoresShopping Malls
Traditional/Pervasive Reach
Government Supported
Historic/Rural Reach
Modern Formats/ International
Evolution of Indian retail
Source of Entertainmen
t
Neighborhood Stores/Convenie
nce
Availability/ Low Costs / Distribution
Shopping Experience/Efficie
ncy
4
Informal retailing Sector Typically small retailers. Evasion of taxes
Difficulty in enforcing tax collection mechanisms
No monitoring of labor laws
Formal Retailing Sector Typically large retailers Greater enforcement of taxation
mechanisms High level of labor usage monitoring
Indian retail
Evolution of Indian retail
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Corporate Houses Tatas: Tata Trent RPG group: Food World, Health and Glow, etc ITC: Wills Life Style Rahejas(ShoppersStop), Hiranandani(Haiko), DLF(DT cinemas) etc.
Dedicated brand outlets Nike, Reebok, Zodiac etc
Multi-brand outlets Vijay Sales, Viveks etc
Manufacturers/ Exporters Pantaloons, Bata, Weekender
Indian retail
Categories of Indian retail
6
Modern Format retailers Supermarkets
(Foodworld) Hypermarkets (Big
Bazaar) Department Stores (S Stop) Specialty Chains (Ikea) Company Owned Company Operated
Traditional Format Retailers Kiranas: Traditional Mom and Pop
Stores Kiosks Street Markets Exclusive /Multiple Brand Outlets
Indian retail
Classifying Indian retail
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Hypermarket Big Bazaar Giants Shoprite Star
Department store Lifestyle Pantaloons Piramyds Shoppers Stop Trent
Entertainment Fame Adlabs Fun Republic Inox PVR
Indian retailers
Large Indian retailers
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Greater per capita income Increase in disposable income of
middle class households 20.9%* growth in real disposable
income in ’99-’03. Growing high and middle income
population Growing at a pace of over 10%* per
annum over last decade Affordability growth
Falling interest rates Easier consumer credit Greater variety and quality at all
price points
Indian consumer
The changing Indian consumer
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The urban consumer Getting exposed to international
lifestyles Inclined to acquiring asset More discerning and demanding
than ever
No longer need-based shopping Shopping is a family experience
Changing Mindset Increasing tendency to spend Post Liberalization children coming
of age100 mn 17-21 year olds*. Tend to spend freely.
Greater levels of education
Indian consumer
The changing Indian consumer
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Market size Current market size is roughly US$
286 bn* 96% of the 12 Million stores are less
than 500 Sq. ft. Forecast Growth rate for the retailing
industry is roughly 8.3% for 2003-2008
Sales from large format stores would rise by 24-49%**
Formal and modern format retailing would enjoy rapid growth
Anticipated growth
Anticipated growth
11
Growth determining factors Government Policy Infrastructure development GDP growth Employment generation and job
creationIn several new sunrise industriesImplies greater purchasing power
Growth factors
Growth factors
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India ranked 5th in the Global A.T Kearney Retail Development Index
Second only to China in Asia Least saturated of all global
markets studied The least competitive of all global
markets studied Implies lower barriers of entry for global players Considering tremendous market size, excellent potential for foreign players
India ranked 3rd in the Global A T Kearney FDI Confidence Index in 2004
Improved from Rank 6 in Year 2003
Advantage India
The Indian advantage
Employment in retailing is increasing
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Employment in Retailing
0
10
20
30
40
50
60
90 91 92 93 94 95 96 97 98 99 00 01
Year
Em
plo
ym
ent
in
Reta
il a
nd
whole
sale
(M
n)
0.00%
1.00%
2.00%
3.00%
4.00%
5.00%
6.00%
7.00%
8.00%
% o
f Tota
l Labor
forc
e
Employment %
14