Drivers of Retail Growth in India

DEMOGRAPHICS

1. 60 % of Indian population is less than 30 years of age
2. 6 metropolitan cities contributes 6% of Indian population , 14 % of Indian GDP & 60 % of shopping malls.
3. Urban population spends 2.5 times more than rural population.
4. Greater per capita income
5. Increase in disposable income of middle class household

• Growing at a pace of over 10% per annum over last decade
• Falling interest rates.
• Easier consumer credit

6.The Urban Consumer

• Getting exposed to international lifestyle
• Inclined to acquiring assets
• More discerning and demanding than ever
• No longer need-based shopping
• Shopping is a family experience
• Increasing tendency to spend
• Post Liberalization children coming of age
• 100 mn 17-21 year olds. Tend to spend freely.
• Greater levels of education

ECONOMIC STABILITY

• 8% annual growth.( service driven GDP growth)
• FER( foreign exchange reserve)= USB$140
• FDI = USB$8
• 20 % increase in export from last year..
• Private consumption is 68% of GDP( India is the highest nation in terms of private consumption).
• Second most favoured destination after china for FDI.
• Unemployment rate has decreased to 7.8% in 2006 as against 10.3% in 2003.
• 24% decrease in unemployment post liberalization.
• India ranked 1st in the A.T Kearney Global Retail Development Index.
  (Considering the Country risk, Market Attractiveness, Saturation & Time Pressure)

PWC India Retail Report for 2007

Are The Indian Customers ready for self checkout system at showrooms?

The question from Kabilan prompted me to think about the modernity in the mind of the consumer. Modernity is it ? Or would it be a need based act? So many apprehensions in the service providers minds emerge from the vastness and uniqueness of the Indian customer. As I look at it, in the vastness and uniqueness lies the answer to all the questions. The variety in our behaviour and the volatility is in some ways a huge opportunity. As if to better that, a service driven economy is a ramification of the fact that we adapt to new technology with a fair amount of ease. So all's well I think for IT providers. Volume driven formats would have no go eventually but to adapt high end technology rather than depend on people purely because of customer convenience and consistency across stores. Watch out for Self Check out technology implementation and keep me posted too!!

LinkedIn: Answers: Are the Indian customers ready for self checkout system at showrooms?

Real Estate and Retail In india - Friends or Foes?

What prompted me to write this was(besides the fact that I hadnt written in along time and was missing it) was the acquisition of Piramyd Retail by Indiabulls Real Estate (through their subsidiary Indiabulls Wholesale Services).

At many forums lately, I have sen the explicit (and some times tacit) conflict between real estate developers and retailers. Now that India has some of the most expensive mall/business districts, it is difficult to fathom the relationship any other way. This definitely isnt helping the mass retailers, especially if they havent been foresighted in space acquisition.

An if you turned this process around, real estate developers are leveraging the space availability and treading into retail. And like they say, makes it convenient to acquire an existing chain

Books on Retail Management

I have been teaching at various B Schools as adjunct faculty for more than 3 years now. The process has evoked mixed feelings and thoughts. While its wonderful to see so many students prepare themselves - mostly,for the corporate world, the gaps in education strike me as glaring. More on that later....

Because I teach Retail management, I have had the opportunity to read many a text book in this time, and some books have been as good as to inspire me to write a text book myself.

Amongst the Indian books I find, Swapna Pradhan's book - Retail Management - text and cases, holds a lot of information in the Indian context.

ANd then, IIM-A Prof Piyush Kumar Sinha's and Prof D P Uniyal's co-authored book titled ‘Managing Retailing’ is very insightful and contextual for Indian students. The approach taken in this book is especially worth mentioning, because it is that of 'retail decision making'. also, it gives retail the imporatnce that it deserves- that of creating value for all the stakeholders. So if you want to learn it the right way, go with it.

Catalog Retailing or Multi Channel Strategy

I have been wondering about the appropriate timing of catalog retailing in India. Was glancing through one of the zillion retail newsletters yesterday, which had this report on how online shopping has increased leaps and bounds in India. And believe me, I have met many VCs who have made me open my eyes to the opportunities in the internet space.

And then I think, buying movie tickets, railway tickets, air tickets, music, books etc.etc is one thing and shopping for clothes, personal products, even gifts is quite another.

So, has the time for catalog retailing in India arrived? I saw the Hypercity-Argos site (www.hypercityargos.com) and interestingly,their catalog shopping was 3 pronged - you could shop online/phone/brick n' mortar store , have merchandise delivered home/pick it up from the store. Catalog retailing? More like multi-channel retailing. And I but agree, the time is right for multi channel retail!!

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