Advantage "Retail India"
The Indian retail industry, over-ridden by social and economic considerations and dominated by the unorganised sector till the Economic Liberalisation in the 1990s, is heading for a big explosion of intense competitive business activities. Retail India is poised to become a dream destination that would sustain and lead the revenue opportunities of important global retail companies. India’s population would remain young for a very long period of time (600 million in 2050A.D), offering the retail companies an opportunity to devise long-term retail strategies as brands potentially have a lifetime of growth before them. The psyche of the Indian consumer has undergone a paradigm shift, as they become more aware of their economic purchasing power. And with the corresponding increase in their income levels, the concept of quality product and service delivery earlier unknown to the Indian consumers have become a necessity, altering their shopping pattern from need-based to bulk-storage based. These developments have led to the large scale entry and expression of interest by many global retail majors in the Indian organized retail market. The Indian retail marketplace is set to become a battlefield of the dominant global retail players and the competition is going to be fierce.
India is slowly emerging as the hot-spot retail destination as the established global retail companies train their eyes on a strong and rapidly growing economy and a young population with high buying potential. In an accelerating retail revolution, where economic growth becomes the principal drivers for consumerism, the highly paid young Indians are surely getting more and more confident of their buying potential. In fact, different statistics say that India has the potential to outpace the most developed economies by 2050, if it maintains the present rate of economic growth. And the burgeoning young educated English speaking middle class workforce make India a must in the itinerary of the global retail majors. Retail India has a clear cut advantage outweighing and outclassing any of its closer rivals due to a few important factors:
- » Favourable Demography (A Young India): India is clearly on a firm pedestal with almost 35% of its population under the age of 14, when the rest of the world has a frighteningly ageing demography. With a whopping 60% of the young population expecting to join the workforce by 2050, and two-thirds of Indians under 35 years of age with a median age of 24 years against the world’s median age of 33, India is definitely a market with enormous potential in the near future. As 20% of the world’s population (potential workforce) under the age of 25 lives in India, the Indian retail market would be a playing field of the global retail giants sooner than later.
- » Potential Virgin Market: India is at the radar of all the global retail companies, classified as the number one priority in the immediate future due to its huge market potentials. With over 75 million households (annual income ranging from 1000USD to 4700USD) creating a perfect consumer base, Indian retail market has ample space for the entry of new retail players and enough room for the expansion of established retail players. The ever increasing population of the rich and the super rich make up a wide spectrum consumers from rural retail to luxury retail. Availability of impressive retail space in the rapidly growing Tier II and III cities, low market penetration, and the prospect for rural retail are significant add-ons to the Indian retail industry.
- » Skilled and Talented Workforce: India scores over other retail destinations due to its huge English speaking talented and skilled workforce. Roughly, India has over 50,000,000 students enrolled in 150,000 pre-college and another 15,700, 000 in over14, 000 higher institutes, preparing to add to the existing workforce in the retail sector. With Retail Education becoming a premium and much sought after course of study in the recent years, companies can put aside their worries of talent crunch to manage the booming retail industry.
- » Low Operating Costs: Low costs play an important role in making India a hot spot for global retail. The Tier II and III cities have significant costs savings in terms of human resources, as many of the rural graduates flocking to the cities for employment turn out to be ideal and perfect candidates for sales and marketing in the organised retail sector.
