Organized Retail Current And Future Prospects

The word Retail comes from the French "retaillier" which means "to cut a piece of" or "to break bulk". Retail will involve activities whereby products can be purchased to consumers in small volumes according to their requirements. The retail sector in India is growing and undergoing change. Early on consumers use to go to kirana stores for his or her daily essentials but with the advancement of retail formats with products under one roof, consumers were attracted to it. Retail types have trained personnel that cater to consumer requirements and it is more sorted out. Organized retailing provides consumers an event characterized with comfort, style and swiftness. It provides consumers more control, convenience and choice. Organised stores have a network of retail outlets that are monitored by specialists.


India is a spot for most retail giants because of its vast middle income inhabitants and untapped retail marketplaces. The retail industry in India has seen a changeover. An annual progress of 25% is expected in India. In the last couple of years, India has witnessed a tremendous development. Change in consumer information and demographics, upsurge in the amount of international brands in the market, government plans, urbanization, credit availability, upgraded infrastructure, increasing opportunities in technology and real estate will be the factors responsible for the retail boom in India. The retail sector has provided career to people in rural areas and contributes to 10% of its GDP and 8% career. In India 3% of the market is arranged whereas 97% of the marketplace consists of mommy and pop stores. The retail sector is little by little increasing. Retail sector can be broadly categorised into food and groceries, textile and clothing, consumer durables, footwear, charms and watches, furniture and furnishing, catering services, literature, music and presents, mobile handsets as well as others. Retail professionals make sophisticated decisions in selecting their aim for market segments and location. Determining want merchandize and service to provide to consumers. The circulation channels to be utilized are another important step for the sellers. They need to make complicated decisions on training and motivating sales affiliates and on deciding how to price, promote and present merchandize. Retail in India is not at the same pace as other Asian counterparts but is gearing up. India has a secured a great position in the international market. India provides huge scope for companies because of its demographic composition. These businesses bring different products and aim for different consumer segments. Global Retail Development Index has situated India as the foremost vacation spot for retail investment and business development. This is because of the large human population comprising of this group 20-34 having high purchasing ability, which has brought on high upsurge in demand in the metropolitan market. Thus leading to expansion in the retail business.



Increase in disposable income

India becoming a popular destination for foreign retailers

India revamping its retail sector

24% expansion in departmental sales annually

Growing society of dual income individuals

Use of information technology

Rural markets as emerging markets for retail

Organised retail basically present in urban areas

Successful in locations credited to consumer buying behaviour


Retail sector in India is going by having a transitional stage and has faced many challenges. A number of the challenges faced are the following

97% of the market is unorganized comprising of mother and pop stores. They have low cost, negligible real estate and labour cost, little if any taxes to pay. Consumers for generations to generations have a tendency to visit these mother and pop stores and have gained favorability.

Organized sector has huge expenditures and need to keep the prices low to match the traditional store prices

The organized retail sector is not recognized as an industry. Thus being struggling to get funds and thereby affecting growth and growth plans.

Investing in real house is very costly. Retailers need to pay large amount to make retail formats. The hire or rent to be paid is high. The high rent or hire reduces profitability.

High stamp obligations that require to be paid by vendors. The stamp duties vary from express to state.

Lack of infrastructure poses difficult to sellers. Poor streets and transportation. Insufficient cold storage space in food and food segments.

Retailers often face multiple taxes in different areas. Value added taxes system.

Approval of foreign retail in India is no programmed process.

Regulations enforced on purchasing real real estate.

Local laws.

Tax policies that favor smaller businesses.

Poor supply string and information technology infrastructure.

Lack of skilled and trained employees.

Low degrees of skill in retail segment.

Rapid price change.

Threat of products becoming outdated.

Threat of low margins


Organized retail provides product awareness and a program for customer interaction.

It assists with launching new products and its own variants

Helps is market penetration and enlargement.

It has wider product range and fast delivery process.

Due to urbanization, consumers can be catered to through an individual retail outlet.

Nuclear households have to generating members which increases the available disposable income. Because of insufficient time consumers want everything under one roof.

Retail retailers have various payments methods like cash payments and repayments through credit or debit card.

Retail shops have proper infrastructure, air conditioning, well maintained complexes, trained staff, electric machines, parking facilities and categorical screen of goods.

It provides customer an experience and improves customer engagement.

Organized retail provides employment opportunities to skilled. Semi-skilled as well as unskilled individuals.

It plays a part in social- economical development of the country.

Due to emergence of retail outlets, there is a great deal of competition. Thus suppliers offer discounts, promotional events, celebration offers etc.

It reduces source chain management process


The retail industry in India keeps growing more and more speedily. The retail sector in the small towns and places is likely to increase 50-60%.

The factors that play an essential role in shaping the continuing future of the retail sector are the following

Due to the upsurge in the income of the average individual, the purchasing ability is increasing.

There is improvement in the infrastructure and thus is contributing to market development.

With liberal regulations formulated by the federal government, foreign shareholders can enter the Indian market and make investment.

As Indian consumers are innovating through purchase of different products and services. The national and international brands are benefitting.

The internet has made it easy for international brands to comprehend Indian consumers and affect them before entering into the market. Because of internet penetration in the remotest market segments, consumers are aware of global products and service offerings.

With well toned retail, large regions of land lying ideal in primary location with governmental and non-governmental businesses may be used to create large retail forms and cater to the requirements of the consumers.

Major tourist destinations have well organized retail areas. Thus, more developed retail industries can attract vacationer to the town and promote it.

Realizing the necessity gap is important in the retail sector.

Use of decision support system by retailers.

Use of technological innovations to provide real-time information of products sold, thus managing inventory levels.

Building store brand by creating footfalls and transforming them into sales.

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