A Comparative Study of Retailing in India by International Retailers
Gagandeep Kaur
MBA(IB)2011-13, 13 C
A Comparative Study of Retailing in India by International Retailers
A COMPARATIVE STUDY OF RETAILING IN INDIA BY INTERNATIONAL RETAILERS
BACKGROUND:
According to AT Kearney, India’s retail industry comprises US$ 435 billion. It entails only 6 per cent of itself as organised retail segment as of 2010, according to Booz and Co (India) Pvt Ltd. Hence, there is a great potential to be explored by domestic and international players, especially after Cabinet's decision to allow up to 51% foreign direct investment (FDI) in multi-brand retail sector and 100% FDI in single-brand retail. (Why India is a big market: refer page 23, Annexure)
The Business Monitor International (BMI) India Retail Report for the fourth-quarter of 2011 forecasts that the total retail sales will grow from US$ 411.28 billion in 2011 to US$ 804.06 billion by 2015. The report has underlined factors like economic growth, population expansion, increasing wealth of individuals and rapid construction of organized retail infrastructure as major drivers for the optimistic forecast figures. (Refer Annexure, fig 2)
According to a research report named ‘Retail Sector in India’ by Research and Markets, Indian retail sector accounts for 22 per cent of the country’s gross domestic product (GDP) and contributes to 8 per cent of the total employment.
FDI in single-brand retail currently is 0.03% of cumulative FDI of around $149 billion from April 2000 to September 2011. The announcement is expected to generate 10 million jobs over three years, without impacting smaller and domestic retailers.
FDI in retail will provide the farming community a new support by investing in good farming practices and providing them with better prices.
The international players will bring a sophisticated front-end that will boost investment in infrastructure by retail players, third-party supply-chain companies and the government. This will improve efficiencies in the supply chain, cut
MBA(IB)2011-13, 13 C
A Comparative Study of Retailing in India by International Retailers
A COMPARATIVE STUDY OF RETAILING IN INDIA BY INTERNATIONAL RETAILERS
BACKGROUND:
According to AT Kearney, India’s retail industry comprises US$ 435 billion. It entails only 6 per cent of itself as organised retail segment as of 2010, according to Booz and Co (India) Pvt Ltd. Hence, there is a great potential to be explored by domestic and international players, especially after Cabinet's decision to allow up to 51% foreign direct investment (FDI) in multi-brand retail sector and 100% FDI in single-brand retail. (Why India is a big market: refer page 23, Annexure)
The Business Monitor International (BMI) India Retail Report for the fourth-quarter of 2011 forecasts that the total retail sales will grow from US$ 411.28 billion in 2011 to US$ 804.06 billion by 2015. The report has underlined factors like economic growth, population expansion, increasing wealth of individuals and rapid construction of organized retail infrastructure as major drivers for the optimistic forecast figures. (Refer Annexure, fig 2)
According to a research report named ‘Retail Sector in India’ by Research and Markets, Indian retail sector accounts for 22 per cent of the country’s gross domestic product (GDP) and contributes to 8 per cent of the total employment.
FDI in single-brand retail currently is 0.03% of cumulative FDI of around $149 billion from April 2000 to September 2011. The announcement is expected to generate 10 million jobs over three years, without impacting smaller and domestic retailers.
FDI in retail will provide the farming community a new support by investing in good farming practices and providing them with better prices.
The international players will bring a sophisticated front-end that will boost investment in infrastructure by retail players, third-party supply-chain companies and the government. This will improve efficiencies in the supply chain, cut