Key Sectors of Indian Retail and FDI in Indian Retail

 Retail is the process of selling consumer goods or services to
customers through multiple channels of distribution to earn a
profit.
 Retail management has become one of the fastest growing
career in the industry with the tremendous growth in the
economy.
 Retail Market of India is the most attractive and emerging
market in the world.

Indian Retail Sector
 Fashion, Fitness and Personal Care
 Health and Pharmaceuticals
 Entertainment Retailing
 Food and Grocery
 Catering Retailing
 Consumer Electronics

 This sector is divided into beauty parlours health centres,
spa, gym, and yoga centres. This sector is characterized by
large formats, which are fairly price competitive.
 With growth in incomes, Indians have been spending
enough money on fashion, fitness and personal care
products. India has over 1 million retailers, of whom 50 %
belong to personal care.
Fashion, Fitness and Personal Care

Retailers in this sector are:
 Lakme Liver
 Health and Glow
 Avon Beauty
 OTC Medicines
 Oriflame Stores
 Shahnaz Hussain

Health and Pharmaceuticals
 Today due to increase in per capita income, all over the
world, people are becoming health conscious and have been
spending more on health and pharmaceutical products.
 Currently, India has over 5 million retailers, of whom 16 %
are chemists.
 Most of the independent retailers have started providing
value added services for the consumers, such as free home
delivery, order over phone and other reminder services.

 In addition, pharmaceutical stores consist of self-diagnostic
digital equipment, skin care, blood pressure, sugar control
products, and toiletries among other things.
Leaders in this segment:
 Life Spring
 SRL Ranbaxy
 OTC
 Oriflame Outlets

Entertainment Retailing
 There are specialized retailers for each category of products
in this sector.
 A few retail chains have emerged particularly in the retailing
of amusement parks, music products and movies.
 This sector is mainly characterized by franchising and retail
chain arrangements/tie-ups.

This retail segment includes :
 Theme parks
 Water parks
 Cyber cafes
 Music stores
 Amusement parks
 Resorts
 Clubs

Food and Grocery
 The food and grocery sector is divided into restaurants, fast
food, coffee shops, juice bars, intercontinental food courts
etc.
 World over, grocery being the largest sector in retailing.
Wal-Mart, Mc Donalds, and Carrefour are some of the key
global players in this sector.
 Food sales accounted for 77% of total sales, growing to 70.7
lakh crores from 35 lakh crores in 2005.

Catering Retailing
 Catering retail is the business of providing food and services
at desired area. It may include Packaged lunch to full service
catering with serving staff at dining tables or in the form of
self-serve buffet.
 The food may be prepared at caterer’s place and final
touching at the place of event or entirely cooked at the place
of event.
 Catering service is usually provided at convention centers,
venues for conferences, seminars, official meetings, weddings
and orientation programmes of big corporates.

Consumer Electronics
 Consumer Electronics Retailing is one of the most amazing
developments in the field of retailing since the advent of
Direct Response Marketing in India.
 Today it is the fast growing segment of the retail industry
after food and grocery.
 The way Indian masses are spending money on luxury and
items of standard living, it is the golden opportunity for every
businessman who is planning of entering into retail industry.

 The Government of India was initially very apprehensive of
the introduction of the Foreign Direct Investment in the Retail
Sector in India. There are different viewpoints on the impact of
FDI in the retail sector in India,
 According to one viewpoint, the US evidence is a proof to the
fact that FDI in the retail sector does not lead to any collapse in
the existing employment opportunities.
 There are divergent views as well. According to the UK
Competition Commission, there was mass scale job loss with
entry of the hypermarkets brought about by FDI.

 Until 2011, foreign direct investment (FDI) was not allowed
in multi-brand retail, forbidding foreign companies from any
ownership in supermarkets, convenience stores or any retail
outlets.
 In January 2012, India allowed 100% FDI investment in
single-brand stores. On 7 December 2012, India allowed 51
per cent FDI in multi-brand retail.
 Now the announcement of retail FDI in India has triggered a
series of debates on both positive and negative notes and
become political issue.

Advantages of FDI in retail sector in India:
 Growth in economy
Due to coming of foreign companies new infrastructure will be
build, thus real estate sector will grow consequently banking
sector, as money need to be required to build infrastructure would
be provided by banks.
 Job opportunities
Estimates shows that this will create about 80Lakh jobs. These
career opportunities will be created mostly in retail, real estate

 Benefits to consumers
Consumer will get variety of products at low prices
compared to market rates, and will have more choice to
get international brands at one place.

Disadvantages of FDI in retail sector in India
 The domestic organized retail sector might not be
competitive enough to tackle international players and
might lose its market share.
 Many of the small business owners and workers from
other functional areas may lose their jobs, as lots of people
are into unorganized retail business such as small shops.

Key Sectors of Indian Retail and FDI in Indian Retail

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Key Sectors of Indian Retail and FDI in Indian Retail