Indian retailers cope with foreign players

India is a nation of shop-keepers — 12.2 million shop keepers to take care of the needs of over a billion people. The ratio of shop to human being is better than the ratio of doctor to human being in this country. The Indian retail industry is divided into three segments:

  • a nano-percentage of stores that are large-format supermarkets
  • larger medium-sized grocer and retailer
  • small shopkeepers who help this country run its business

The small shopkeeper will largely remain unaffected by the aggregation of business with retailers from overseas entering the Indian market. These nifty operators are widely dispersed in terms of geography and cater to an important need of the masses. Organized retail as attempted in developed economies cannot aspire to cater to this role played by the micro-outfits of the day with efficiency. These tiny outfits will therefore not only survive, but thrive as well.

The ones who will be really hit are the medium-sized stores. They will fall between two stools. At one end they do not have the scale and the efficiency that comes from scale. These medium-sized retailers will suffer a process of sudden death. As large-format retail enters the Indian market, it will take all of 2-5 years for these medium-sized retailers to collapse, reinvent other models to survive, and migrate out of the retail business altogether.

Comments

Post a Comment

Popular posts from this blog

Image
Nathula Pass The India-China bilateral trade is expected to exceed $20 billion in 2006, the reopening of Nathula Pass on July 6, 2006 linking Sikkim with Tibet and neighbouring areas of China marks a new chapter.This route was used to trade silk between two countries was halted following the Indo-China war in 1962 and after 44 years it has opened again. This will become the third trade point between the two counties the other two being Gunji in Uttranchal Namgaya Shipkila in Himachal Pradesh The agreement to open the pass was signed when former Prime Minister Mr. Atal Bihari Vajpayee visited china in 2003. A total of 29 items can be exported and 15 items can be imported.
Read more
Inclusive branding Inclusive branding is about building brand propositions that embrace one and all and make the brand accessible to an inclusive mass of people. For example let’s take the brand portioning of toothpaste: In the beginning, one spoke of a toothpaste that brushes your teeth well and clean Then it went on to say that it whitens the best. And then one added colours to the toothpaste. There came red stripes and then blue and then all three red, white and blue in one toothpaste. When consumers got tired of this, in came the gels of different colours. The colours kept changing. When consumers got tired of this, in came the gels of different colours. The colours kept changing. Even this is done to death. Toothpaste that can make you fall in love? A toothpaste that can get you a new job? And then one taps into the final frontier. This frontier is what I call `inclusive branding. Branding is essentially an exclusive pr...
Read more
Indian Agriculture The number of deaths reported in the last 10 years has exceeded 30000 and almost all state have been effected at one time or another. So, Prime Minister Dr. Manmohan Singh has announced a relief plan of 3750 crore for resuscitates the enervated lives of tens of thousands of farmers in six district of Vidarbha region of Maharashtra . The cotton econonly is rather doing well the last three season with rising production 250 lakh bales, higher yields over 400kg a hectare and better price. Indeed India has begun to export cotton in a big way 35 lakh bales in 2005-06.
Read more