The last few years have seen rapid transformation in many areas, settling scalable and profitable retail models across categories. Indian consumers are rapidly evolving and accepting modern formats overwhelmingly. Retail space is no more a constraint for growth. India is on the radar of global retailers and supplier / brands worldwide are wiling to partner with retailers here.
Further large Indian corporate groups, as also foreign investors and private equity players are firming up plans to identify investment opportunities in the Indian retail sector. The quantum of investments is likely to sky rocket as the inherent attractiveness the segment lures more and more investors to earn large profits.
With the largest young population in the world over 890 million people below 45 years of age India is indeed resplendent market. India has more English speaking people than in the while of Europe taken together: It s 300 million odd middle class, the Real consumers is catching the attention of the world. As the economy grows so does India’s middle class. It is estimated that 70 million Indians earn a salary of over INR 800,000 ($18,000) a year, a figure that is set to rise to 140 million by 2011. The number of effective consumers is expected to swell to over 600 million by 2010 – sufficient to establish India as one of the largest consumer markets of the world.
Favorable demographic and psychographic changes relating to India’s consumer class, international exposure availability of increasing quality retail space, wider availability of products and brand communications are some of the factors that are catalyzing organized retail in India. Over the last few years many international retailers have entered the Indian market on the strength of rising affluence levels of the young Indian population along with the heightened awareness of global brands and international shopping experiences and the increased availability of retail real estate space. Development of India as sourcing hub shall further make India an attractive retail opportunity for the global retailers. Retailers like Wal-Mart , GAP, Tesco, JC Penney, H&M Karstadt Quelle etc are stepping up their sourcing requirements from India and moving from third party buying offices to establishing their own wholly owned / wholly managed sourcing and buying offices, which shall further make India as an attractive retail opportunity for the global players.
With him changing face of retail, the Indian consumer is in a rapid transformation. Consumer spending continues to grow at double digit figures. According to India, retail report 2007, the total private consumption touched INR 20,000 billion ( US $ 445 million) at current prices in the calendar year 2006, with organized sector accounting for INR 55,000 crore ($12.4 billion) worth of business increasing it share to 4.6 per cent of the total Indian Retail Value that stood at INR 12,000 billion ($270 billion). Moving forward, organized retailing is projected to grow at the rate of about 37 per cent in 2007 and 42 per cent in 2008. Organized retail in India has the potential to add over INR 2,000 billion ($45 billion) worth f business by the year 2010.
This consumer spending is ultimately pushing the economy into the growth and liberalization mode. The Indian market is becoming bolder by the day, with the economy now expected to grow at over 8 per cent an averages salaries being hiked by about 15 percent there will a lot more consumption and a lot more potential for organized retail.
In the year 1991, department’s stores were on the top of the perception mp, the increase in the types of to stores and choice available to the customer available to the consumer. The repositioning of the department store had happened in the perception map of the customer. This change was not attributed to anything done by the customer but to the maturing of the customer.
The customer had evolved to a different lifestyle and the Company realized that it could not afford to be where it was in terms of positioning in some categories the store had kept pace with the changes in the customer and in some cases it lagged behind. At this point in me, the Company made a conscious decision to more upwards as shopper’s stop the brand. It was envisaged than this entire exercise would be spread over a period of 15-18 months.