IndiaRetailBiz

“As the Indian consumer goes all out to seek new experiences from food and wine, installs an in-home spa and holidays in exotic destinations, modern retail is well on the way to being the key driver of the Indian economy over the next decade because India’s consumer demand is simply unstoppable.” — Geoff Hiscock, Author.

“India’s Store Wars: Retail Revolution and the Battle for the Next 500 million Shoppers,” is the title of a book on India’s retail revolution, written by Geoff Hiscock, an Australian Author, that has just hit the stands in India.

The book explores the changes in the demographic profile, tastes and spending habits of the Indian consumer, how younger Indians have more confidence and are willing to borrow to finance their consumption.

India Retail Report 2009, a recent study on retail spending of Indian consumers, has estimated that the spending will rise from Rs.13.30 lakh crore now to Rs.18.10 lakh crore (US$280 billion to US$380 billion) by 2010.

“That is a huge increase in spending, and we can put it down to the fact that not only are incomes rising but younger people entering the workforce are more prepared to spend money than their parents were. The ’save’ mentality is being replaced by the ’spend’ mentality,” Hiscock said.

According to another research report prepared by Images F&R Research, which was released at the recently concluded India Retail Forum 2008, modern retail’s share of the total consumer spending at only 3-4 percent a few years ago, after growing at more than 40 percent in 2007, has gone up to 5.9 percent and is expected to reach a 13 percent by 2010.

Apart from the global economic slowdown, according to Hiscock, modern retail must contend with some specific problems that affect retail sector in India. Since, poor supply chain leads to terrible wastages in the shipping, storage, and distribution of fresh products (like fruits, vegetables and dairy products) India needs to fix logistics, including a comprehensive cold chain system in transportation, says the author.

While, drawing attention on near absence of information technology backbones and lack of skills in retail management, Hiscoc rues high real estate prices and extreme competition in the key metropolitan markets.

Hiscoc is unhappy about volatile political environment where lobbies representing interests of middlemen, small traders, grocers and street vendors, who are fearful for their economic future, are opposing local and foreign corporates that are foraying into the retail sector.

“But overall, I’m confident India’s modern retail sector can work through these issues, and the consumption boom will continue, thereby driving up India’s growth rate,” concludes the author.