2017 was a rollercoaster year for retail. Retail industry had to go through various key landmark decisions like Demonetization, Digitization & GST.
The structure of the retail industry is changing at a rapid pace as we can see that the online space is collaborating with the offline space. Many e-commerce companies had to shut their shop, while some opted for restructuring or mergers.
In offline space too, we saw many interesting takeovers. We also witnessed an interesting shift in customer buying patterns due to increase in digital payments. Retail industry has been able to overcome quickly from the confusion during the initial phase of GST implementation as compared to other sectors.
With Government working continuously on reviewing the slabs on the products will surely benefit the industry in the long run. Along with this, the Government is also working on various policies such as tax cuts, health care, housing, and finance, and this would increase consumer spending.
Disposable income has also gone up by 3.4 per cent because of which hourly earnings have started to grow, as a result of which, consumers are indulging themselves in more and more buying activities.
Talking about competition, we can see that retail’s biggest competition is not only coming from big retail stores, but also from small and nimble players in the current market.
Future of Retail – 2018 Looks Promising
India is all set to gain from the latest FDI policy in retail.
There has been an increase in purchasing power of the consumer due to easy availability of credit which has given a push to higher value items and encouraged repeated purchases. There has been a clear shift in consumer mindset when it comes to buying. They are more educated and well informed. They have become more experimenting and are willing to try and buy products which they haven’t used till now. The expansion of middle class has led to higher purchases of luxury products and brand consciousness.
Significant growth in discretionary income and changing lifestyle are among the major growth drivers of Indian retail industry. With GST taking its shape, it has helped the retailers simplify its tax structure. This will lead to better supply chain structure, better cash flows, pricing, and profitability.
Rural markets show high growth potential if tapped with the right set of products and pricing. With increasing investments in infrastructure, connectivity to such towns is now becoming easier. This helps the retailer to increase reach in such high potential markets.
We can expect social networks to soon evolve as retail channels. This is because companies are investing heavily in providing services to customers directly, this trend will evolve and will transform the current shopping session into a well-known retailing session. New players, new business models, rising customer expectations will all likely change retail’s future landscape.
Retailing is more than brick-and-mortar, and retailers who are agile enough to adapt and innovate their way through changes continue to grow and thrive in new and unexpected ways. The future of the retail industry looks promising, as more and more Government policies have come into play, making it favorable to do business.