Organised retail in India will witness around 18 per cent of the overall retail pie by 2015, up from its current five per cent market share, says a recent McKinsey research.
The research further notes that the growth will open a viable ground for overseas brands in India provided they come up with new formats for this move.
“It is required to bring innovation in terms of the format of stores and should be on the basis where to participate in the retail value chain, which geographies to play in and what price points to offer. It is also required to craft a customer-insight driven merchandise strategy and create an efficient retail operating platform,” suggests the report.
McKinsey’s retail report also talks about the uniqueness of the Indian shoppers vis-à-vis the rest of the world.
The report also estimates that at present only 13 million households in India have their incomes adequate to appreciate organised retail which will grow five fold to 65 million in the next eight years. But the traditional ‘mom and pop’ stores would continue to be relevant across the country in both small and large towns.
Laxman Narasimhan, director, McKinsey & Co, said: “Given the nascent state of organised retail and the rapid evolution of the industry, it is imperative for retailers, manufacturers, real estate developers, logistics providers and partners along the value chain to work in a collaborative spirit.”
The report entitled ‘The Great Indian Bazaar: Organised Retail Comes of Age in India’ also stressed on the necessity of integrating real estate into the business model and to create a stable supply chain to achieve leadership position in the sector. Further, retailing in India would require an approach that is distinctively different from the rest of the world.