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AN OVERVIEW of RETAIL SECTOR

Retailing Worlds largest private industry

US$ 6.6 trillion sales annually Indian retailing

Largest employer after agriculture - 8% ofpopulation

Highest outlet density in world Around 12 mn outlets

Still evolving as an industry Long way to go

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Organized Retailing as a % of totalRetailing

CountryCurrent share of org.

retailing (%)USA 80

Argentina 40Brazil 40

Thailand 40

Korea 35

Taiwan 35

China 20

Malaysia 20

Poland 20

India 2

*DATA OF 2008

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Retailing & India Largest private industry in India

2nd Largest Employer after agriculture

Contributes 10% of GDP

Highest Retail outlet density in the World

Growth @ 2% (1995-2005)

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Segment-wise recent trends anddevelopment in retailing

Food and grocery Textile and apparel Consumer durables

Music and books Jewellery Wooden furniture Leather footwear

Handicrafts Fast food chains Real estate Fuel retailing

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Traditional/Pervasive

Reach

GovernmentSupported

Modern Formats/International

Historic/

RuralReach

EVOLUTION OF INDIAN RETAIL

Exclusive Brand Outlets Hyper/Super Markets Department Stores Shopping Malls

PDS Outlets Khadi Stores Cooperatives

Convenience Stores Mom and Pop/Kiranas

Weekly Markets Village Fairs Melas

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Classifying Indian retail

Modern Format retailers (organized) Supermarkets Hypermarket (3000-5000 sq ft) Department Stores (1000-2000sq ft)

Convenience Stores (750-1000 sq ft) Company Owned Company Operated

Traditional Format Retailers (unorganized)

Kiranas: Traditional Mom and Pop Stores Kiosks Street Markets Exclusive /Multiple Brand Outlets

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Categories of Indian retail

Corporate Houses Tatas: Tata Trent RPG group: Food World, Health and Glow, etc ITC: Wills Life Style

Rahejas (ShoppersStop), Hiranandani(Haiko),DLF(DT cinemas) etc.

Dedicated brand outletsNike, Reebok, Zodiac etc

Multi-brand outletsVijay Sales, Viveks etc

Manufacturers/ Exporters Pantaloons, Bata, Weekender

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Large Indian retailersHypermarket

Big BazaarGiantsShopriteStar

Department storeLifestylePantaloonsPyramidsShoppers StopTrent

EntertainmentFame AdlabsFun RepublicInox

PVR

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Entry Routes of Foreign Retailers Franchise

International company gives name andtechnology to local partner. Gets royalty inreturn

In case master franchise is appointed for regionor country, he has right to appoint localfranchisees

Nike, Pizza Hut, Tommy Hilfiger, Marks andSpencer, Mango

Manufacturing Company sets up Indian arm for production

Bata India,has right to retail in India

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Entry Routes of Foreign Retailers Distribution

International company sets up localdistribution office

Supply products to Indian retailers to sell Also set up franchised outlets for brand

Swarovski, Hugo Boss Wholesale trading

Cash and Carry operations 100% FDI permitted

Metro Cash n Carry

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COMPANIES WHO WANT TO ENTER INDIANRETAIL MARKET

WALMART (worlds largest turnover company) withBHARTI

Italian designer GIOGRGIO ARMANI with DLF

ltd.(51% share of armani) 2nd biggest retailer Frances

CARREFOUR by 2009.

Britains MARKS & SPENCERwants to expand in India.

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WHY FDI SHOULD BE PERMITTED? Improve competition Develop the market Greater level of exports due to increased sourcing by

major players

Investment in technology Better lifestyle

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WHY FDI SHOULD BE PERMITTED?

Manpower and skill developmentTourism DevelopmentInvestment in whole supply chainLong term benefits

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Politics nd FDI in retailing

BJP hints at scrapping FDI in retail if voted to power

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RECOMMENDATIONS

Allow FDI in Retailing First bring foreign companies in less sensitive

sector. FDI regime should be gradual Invest in supply chain infrastructure

Provide retailers with easy access to finance

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CONCLUSION

FDI in retailing would surely an advantage to Indiaand it would also help India in becoming 'developedcountry'. As the people also accept the retailing itwill be an advantage to them also. So the

government should also open the retail sector to theforeign investment, as it also serves as anemployment generator.

So, 'FDI in retailing is the need of the hour'

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TH NKYOU