ORGANIZED RETAILING IN INDIA- AN EMPIRICAL STUDY OF APPROPRIATE FORMATS AND EXPECTED TRENDS
August 11, 2021
The retail sector and its environment have experienced radical changes in the last decade. Most of the challenges are due to changing demographic, social, politic, business climate, and changes in the retail sector including the addition of Wall Mart, Carrefour, K-Mart, etc. This paper examines the relative importance of the various products purchased at organized retail outlets and the choice of format, the consumer has when purchasing a product. The paper also discusses the expected development of organized retail in the future, focusing on aspects with potential effects on consumer purchasing behavior. Not all items are equally important for retail outlets and various products need specific retail formats.
The estimated value of retailing in India is USD 200 billion, of which organized retailing (i.e. modern trade) makes up approximately 3 percent or USD 6.4 billion. Expected annual growth of organized retail is 25-30 percent and is likely to reach USD 23 billion by 2010. At these levels, organized retail would constitute about 9 percent of overall retail sales. In modern retailing, a key strategic choice is format. Innovations in formats can provide an edge to retailers. Post-World War II, the key demographic trend was migration away from the city-centre towards the suburbs. This led to the emergence of the 'shopping centre', a cluster of outlets in a location offering a range of merchandise catering to most needs of the immediate suburb. The 50s saw the emergence of the 'enclosed' shopping mall, providing an end-to-end shopping and entertainment experience from food courts, theatres to shopping outlets.
