Analysing the Retail Industry

Topics: Retailing, Department store, Shopping mall Pages: 10 (4005 words) Published: September 12, 2010
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Analyzing the Indian Retail Industry
Description: The globalization of the Indian Economy has brought forward a change in the Indian consumerism psyche with the consumer becoming more aware of his/her value of money strength and their economic purchasing power becoming more evident than in the previous generations. The concept of product quality and service delivery which were earlier not very engraved in the consumer psyche are now very much demanded and delivered for in the new age format of organized product retailing in the Indian consumer goods market. These changes have led to the overall increase of professionalism in the service delivery as well as the consumer purchase patterns shifting from “need only” based to “extended storage-based bulk purchase characteristics. These have led to the entry and expression of interest by many global retail majors in the Indian organized retail market wherein many products and services are offered to the same consumer at the same location which present multiple attractions to their monthly disposable incomes. The middle class has been a leading adaptor of this change process by its changing lifestyles, strong income growth and changing demographic patterns which are placing the growth projections for this industry comfortably at 25% annually. Today, synergies based on huge consumer bases developed in unrelated industries like telecom to retail are being seen in the Indian market as the combined purchase affinity of the middle class far outstrips the specialist purchase patterns of the higher income strata in the Indian sub continent; with the industry projected to become a US$175-200 billion business by 2016 and the economy playing a comfortable upswing role, the competition in the marketplace is expected to be fierce. The present scenario of the industry is focused on forward buying of retail real estate in order to reap balance sheet advantages later in the business cycle and also rapid ramping of operations in presently operating outlets in order that the loyalty purchase habits of consumers are built over a period of time before the world majors enter the market with deeper pockets and buying power. The Asian retailers are not willing to give in an easy competitive fight on their home turf as well as the smart small time mom & pop store retailer known as the “kirana store” in India is also wizening up to the challenge and building personal relationships apart from increasing the service spectrum like never before. The market in all seems to be ready for a big explosion of intense competitive activity over ridden by social and economic considerations which will make it one of a kind business study in the corporate universe as an economy which did not open up till the early 1990’s where in the industry was dominated by unorganized retailer till then and any kind of central purchase or retail formats where only propagated by the government for which the awareness as well as effort were low. Aruvian's R'search’s report - Analyzing the Indian Retail Industry 2007 - on the Indian Retail Industry is an in-depth and comprehensive cross industry review on the Indian Retail Industry which explores the macroeconomic scenario of Indian economy which coupled with growth of GDP led to the shift of consumer purchase patterns and the build up confidence in the retail sector thereby giving shape to the government allowance for FDI in the Indian retail sector. The report provides an overview of the industry along with the investment inflow in the industry which has also been channelized into the rural sector in India by some of the players. The report also attempts to place an estimate on the volume of the unorganized retail sector of India in comparison to the overall industry size. This report follows the changing consumer preferences of the Indian buyer along with the gender driven increase of purchasing...
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