Will supermarkets replace hypermarkets in the future?

Will supermarkets replace hypermarkets in the future?

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The Indian modern trade scene is increasingly getting complex day-by-day. The hypermarket format that used to be sensation a few years ago is shrinking in size and is expected to loose its sheen in the future for various reasons – increasing rentals and consumer convenience to name a few. Instead, the supermarket format, which occupies less space and offers more convenience is expected to rule the roost as far as food retail is concerned.

Will supermarkets replace hypermarkets in the future?
Over the last decade, Hypermarkets were growing at a fast pace and had gained the position of shopping recreation centre for an entire Indian family

What Is A Supermarket?

A supermarket, a large form of the traditional grocery store, is a self-service shop offering a wide variety of food and household products, organized into aisles. It is larger and has a more wide selection than that of a traditional grocery store, but is smaller and more limited in the range of merchandise than a hypermarket or big-box market.

What Is A Hypermarket?

In commerce, a hypermarket is a superstore combining a supermarket and a department store. The result is an expansive retail facility carrying a wide range of products under one roof, including full groceries lines and general merchandise.

Hypermarket v/s Supermarket

Over the last decade, Hypermarkets were growing at a fast pace and had gained the position of  shopping recreation centre for an entire Indian family. And it was not just in India. This format was picking up the world over. However, situations have changed now.

Will supermarkets replace hypermarkets in the future?According to MD , Jamshed S Daboo, “Just like in the entire world, hypermarkets have their limitations in India as well. Now, customers are looking at more convenient ways to shop. So, the hypermarket format is actually coming down in terms of size and it is the supermarket format which is now gaining momentum as far as food retail is concerned. The other issue as far as hypermarkets are concerned is space crunch. It is getting difficult to get a huge space in the mall as there are not many malls coming up in India.  So, hypermarket format is not expected to grow at the same rates that we have seen earlier.”

Will Hypermarkets Be Restricted to Urban Areas?

The hypermarket format is yet to be introduced to the rural population. Those avenues remain unexplored. But the question here is will the same format that has been accepted by the urban population gain popularity in rural areas?

Daboo says, “The hypermarket format will be largely an urban phenomenon. Modern retail going into rural India will happen without any doubt but what format it will take and what form and shape it will take, is too early to guess.”

He further adds, “One of the mistakes that a lot of people make is to take urban models and move them into rural, but that will not work. We have to come up with a model that suits a particular market and that will happen but that will take time.”

The Future of Hypermarkets

Hypermarkets in India are facing same problems just like its other global counterparts. The format is going through an aggressive change as downsizing has become a predominant phenomenon.

“All over the world people are restricting the size and in fact downsizing hypermarkets. In future, this format will become smaller and it will become multi-format in nature. Hypermarkets will have a place but not as predominant as earlier,” reveals Daboo.

He concludes, “The format that caters to the catchment is the right format and that should be adopted. The supermarket format in India will expand rapidly and the hypermarket format won’t expand much.”