Retail industry

Presented by: Ashish sahani

Jasmine bhagria
Nivedita pandey
Neha gopal
Bhawna rani

12/15/09
Introduction

 Retailing includes all activities involved

in selling goods or services directly to
final consumers for personal, non-
business use.

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Types of retailers

1. Store retailer
2. Non Store retailer
3. Retail Organization

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Major non-store retailer
types:
 Direct Selling: Example: Eureka Forbes
 Automatic Vending: Example - ATM
 Buying services :Example - Amazon.
COM
 Direct marketing :Example: Dell
Computers

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Retail Organization mainly
falls into 4 major categories:
1. Corporate chains: Example -
Pantaloons, Westside
2. Retail Co-operative: Example - Amul,
Samavaika, Khadi Gram Yudog
3. Consumer Co-operative: Example -
Apna Bazaar
4. Franchise Organization: Example -
Monginis, Mc-Donald's
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Retailing formats
 Malls:
 Specialty Stores:
 Discount Stores:
 Department Stores:
 Hyper marts/Supermarkets:
 Convenience Stores:
 MBO’s

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Retail and India

 The sector is on a high growth trajectory

and is expected to grow by more than 27 per
cent over the next 5 to 6 years
 Retail is one of India’s largest industries,
contributing to about 10 per cent of the GDP
and providing employment to 8 per cent of
the nation’s workforce

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Traditional and modern
retailing: The India story
 Prevalence of traditional retailing is highly
pronounced in small towns and cities with
primary presence of neighbourhood “kirana”
stores, push-cart vendors, “melas” and
“mandis”
 mom-and-pop retailing outlets

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Major retailers

 Big Bazaar -(Future Group) and headed by

Kishore Biyani
 Bharti Retail
 Reliance Retail
 DLF Shopping Malls
 Other players who have recently joined
include - A.V. Birla Group , LM group
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International retailers
 Mango
 KFC
 Reebok
 Ruby Tuesday
 TGI Friday’s
 Mc Donalds
 Levi’s
 Arrow
 Lacoste
 Subway 12/15/09
Coming soon…..

 France’s Carrefour SA
 Britain’s Tesco
 Wal-mart

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Trend

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Changing phase

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Competitive Markets
 Perfectly competitive market
 Influential prices because of the presence of
large number of players operating at large
scale
 Homogenous products being sold makes the
market a perfectly competitive market
 Charged price gets noticed
 Entry and exit
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Elasticity and cross elasticity

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s

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SWOT analysis

 Strengths
› Technology : successful organized retailer
today work closely with their vendors to
predict consumer demand, shorten lead time
reduce inventory holding and ultimately save
cost

 Weakness
› 1. Less Conversion level
› 2. Customer Loyalty
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 Opportunities
› Rural Retailing :India huge rural population has
caught the eye of retailer looking for new areas of
growth
› Percolating down: expected to enter into tiers-II
cities
› Organized retail :expected to grow by 20-25% p.a

 Threats
› unorganized retailers :they are parallel to large
supermarket with high degree of flexibility in
merchandise, prices and turnover
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› Shopping Culture
Contribution of Retail

 itwill also help strengthen the linkages

between the different sectors so as to
break the vicious circle of poverty and
ensure a bright future for the next
generation.
 The benefit of retailing to general public
includes growing awareness and brand
consciousness.
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 Indian Retail: Past Vs
Present
Yardstick Situation in 04-05 Situation in 07-08

Value of retail sales Rs. 10,20,000 crore Rs 12,00,000 crore

Annual growth rate 5% 5.7%
Value of organized market Rs 35,000 crore Rs 55,000 crore

Share of organized market 3.4% 4.6%

in the sector
Forecasts (after 5 years) Over Rs. 1,00,000 crore Rs. 2,00,000 crore
about size of organized
retail market

Forecasts about growth Around 30% Around 40%

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rate of organized retail
market
FDI in Retailing
 ForeignDirect Investment in the retailing
sector can have immense benefits
› It can generate huge employment for the semi-
skilled as well as illiterate population which
otherwise can't be employed in the already
confined rural and organized sector
› it can facilitate the improvement of the standard of
living of farmers by purchasing commodities at a
reasonable cost
› It also stems out an indirect employment
generation channel by training and employing
people in the transportation and distribution
sectors such as drivers, mechanics etc 12/15/09
 E.g.. Bharti Retail- a wholly owned subsidiary of
Bharti Enterprises. has announced two joint ventures
(JV)with the international retailing behemoth, Wal-
Mart.

 The first JV ensures cash and carry business, in which

100 percent FDI is permitted and it can sell only to
retailers and distributors. The second JV concerns the
franchise arrangement. Sunil Mittal, Chairman of the
Bharti Group assured that the ventures will use “low
prices every day” and “best practices for the
satisfaction of the customer”. 12/15/09
Wal-mart facts

 Retail Sales of Wal-Mart for the year

2003 was US $ 25,632.9 Crore; higher
than the size of Indian retail industry.
 The size of any Wal-Mart store is much
higher than the size of any existing
shopping mall in India.
 Wal-Mart has over 4,800 stores, which
is unparallel to any of the India's large
format store. 12/15/09
 New stores opened annually by Wal-Mart
are about 420, much higher than all
organized Indian retailers put together.
 The sales per hour of $2.2 Crore are
incomparable to any retailer in the
world.
 Wal-Mart has around 30,000 suppliers
throughout the world and more than
600,000 SBU's on its web site, a number
that cannot be compared.

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Impact of Recession on Retail
Industry
 The suddenly disturbed economic
status, consumers are gradually losing
interest on buying.
 For those interested, the unbalanced
income, followed by the economic
slowdown is not meeting their buying
requirements

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Growth in other retail sectors

 Growthof FMCG: expected to grow

by 60% by 2010

 Growthof Consumer Durables:

expected to grow by 40%
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Challenges
 Supply Chain Management :facing the
challenge in logistic, because of constant
change in consumer preference and
evolution of new retail formats.
 Frauds in Retail : vendors
fraud,thefts,shoplifting.
 Challenges with Infrastructure :lack of
infrastructure in country results in the
inefficient process.
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Conclusion

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THANK YOU

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