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The Rising East: The booming retail market of Eastern India

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East India, one of the most conservative markets of India till a decade ago, is breaking shackles across all retail platforms today. Despite being home to a very dense population, the Eastern part of the country missed several glorious years in becoming a major retail hub of India. However, with the turn of the new millennium, the market has been on a growth trajectory. The region is at the cusp of being transformed from a traditional customer base into a brand conscious, product-savvy market. Its young generation is shopping and demanding both fashion and quality along with value for money spent from retailers.

Analysts have attributed this upward swing to the evolving middle-class, rising disposable incomes and growing aspirations for improved living standards, especially among the Millennials. And retailers – big and small, organised or unorganised, regional, national and even international – are gearing up to meet these impossible demands, and some very successfully so.

To a market strategist, East is undoubtedly an ideal location for the growth of the retail industry. Besides being the principal retail-and-services market to a vast hinterland, there are cities which can serve as a center of trade and commerce for the region. East’s proximity to Bangladesh, a country of 13 crore+ consumers, and to the South-East Asian markets, is another factor due to which the region is fast emerging as a vibrant business center. The Kolkata Port and the Haldia Port are also instrumental in acting as gateways to landlocked countries like Nepal and Bhutan.

Emergence of new formats too have played a major role in this progress. Hypermarkets, large supermarkets with more than 5,000 sq. ft. of retail space, mini markets/ supermarkets, convenience stores with self-service set-ups and value-added services including home delivery, cash on delivery, easy returns and replacements are doing wonders for conservative middle-class consumers in both rural and urban areas of the East.

Prominent retail chains like Bata, Reliance Fresh, Spencer’s, Aditya Birla Group, Shoppers Stop, Future Retail, V Mart, Pantaloons, Liberty, Provogue, V2, Joyalukkas, Bharti, fabindia, and Cantabil, have established themselves as premium retail leaders and have been operating successfully in the region since a decade.

Many local retail chains have also taken advantage of this ascending growth trajectory and have increased operations to such a level that they have become household names in Bengal and states around the area.

The Mall Story

In the East, semi-premium, large and medium format malls with international, national and regional brands are holding centerstage, operating successfully. Malls like Forum and Quest – built over lakhs of square feet of area – are popular not only because of the brands that they host but also for other offerings including dining options, entertainment zones and multiplexes.
Towns like Durgapur, Siliguri and Haldia are also showing serious potential of becoming busy retail addresses. For instance, Durgapur City Centre by Bengal Shristi Infrastructure Development Ltd., is a great cosmopolitan arcade – it is a modern, multi-facility, multiutility, urban plaza, spread over a sprawling 370,000 sq. ft.

Bhubaneshwar too is slowly rising up the charts, becoming the second most popular retail hotspot in the east after Kolkata, representing two faces of retailing – one, a traditional store evolving with time, and another, a recently inaugurated mall from a group that is credited with having revolutionized the retail scenario in Kolkata.

Multi-brand shopping complexes in the city have become shopping destinations not only for the people of Bhubaneshwar, but also for people from surrounding areas like Cuttack.

High streets with the best of brands and eateries are also luring consumers at an equal rate as that of malls. Large format-shopping areas like 22 Camac Street are crowd pullers. With a total floor area of 3,80,000 sq.ft., the high street boasts of huge weekend footfalls. Even small towns like those of Bhagalpur, Muzaffarpur, and Gaya in Bihar are slowly opening to the mall and high street cultures and embracing online shopping, giving strong competition to Patna in the retail sector.

Steady Growth

From an infrastructure perspective, East India has been well-integrated through improved communication systems, real estate development, urbanization, a well-traveled population and the growing service sector. There has been a palpable shift in the customer buying pattern and expectations in the East, owing to the increasing middle-class segment, rising disposable incomes and growing aspirations for improved living standard. These factors are further influenced by media exposure, globalization of cultures, lifestyles and better technology. Overall, the East has done a good job in growing the retail industry and continues to foster retailers – big and small.

“East India’s retail market has witnessed steady growth over the past years owing to start up coming into the business with investor backing, Eastern origin brands increasing their foothold in metros as well as in Tier I & II towns and cities, and national and international brands joining the league. The consumption growth in this part of the country can be attributed to the rise in affluence, which is not to just limited the metros but also true for the Tier II & III cities. The other catalyzing factors are urbanization, and the fact that consumers are pressed for time and are likely to pay premium for convenience,” says Devansh Binani, Director, Himalaya Optical.

“Due to the revolution in the telecom market the digital maturity of the customers has led to brand awareness and consumers prefer buying from organized branded stores for better shopping experience. The agility in the retail infrastructure with the increase in the number of malls has also boosted the growth,” he adds.

“Contrary to popular belief the East is catching up in terms of rising disposable income and consumption also. There is a demand for newer concepts and options. Disposable incomes are on the rise here and are fueled by an extremely aware and conscious consumer who is completely updated with the trends existing in the rest of India. The eastern consumer is not hesitant when it comes to trying bolder looks or high-value products,” states Kumar Saurabh, Chief Business Officer, Manyavar.

Malini Singhal, Director, Zink London, believes that for a brand like hers – a women’s western wear brand launched in September 2012, which delivers garments that are vibrant, young and quirky. – East India is a most exciting region. “The customers are very trendy and are keen to explore new styles and silhouettes. Cities like Patna, Bhubaneshwar, Ranchi, Siliguri and the North Eastern region have shown a very rapid growth. The availability of fashion is limited as compared to other regions. We have grown by more than 5x in the East in the past three years” she says.

Manish Agarwal, CEO East, Future Retail adds to this, saying, “Retail in East India has been shaping up quite well. New cities are emerging, and existing cities are witnessing more action with new retailers stepping in. The last three years have witnessed intense retail action in Tier I & II cities, especially in the suburban areas.”

He, however, is quick to add that while the opportunities are immense for all types of retail formats to flourish – fashion brands, supermarkets, hypermarkets etc. – there is an acute need for retail real estate to develop and expand faster.

Vasanth Kumar, Managing Director, Lifestyle International Pvt. Ltd. agrees, saying, “While growing consumerism is an opportunity, the lack of adequate supply of quality malls across the Eastern region is a challenge for retailers across the spectrum.”

Despite the slow growth of malls in the region, retailers are eager to tap into the region – and not just into big cities like Kolkata and Bhubaneshwar.

According to Vivek Prabhakar, CEO, Chumbak Design Pvt Ltd. East India is a big focus for their brand in 2019. “We have experienced a great acceptance of our brand and the customers here have reacted well to our product range. Both Kolkata and Bhubaneswar are key business centres and having seen the reaction here, we are excited to delve deeper into the region. There are immense expansion opportunities that exist in the region. Apart from Kolkata and Bhubaneswar where we’re already present, we have shortlisted more cities of interest specifically Guwahati, Patna, Ranchi that are of interest to us.”

Retailers have, over the years, have seen and realized the scope and opportunities of retail market in East India. Debaditya Chaudhury, Managing Director, Chowman Hospitality Pvt. Ltd. says, “East India has shown remarkable growth in its retail trend and is the most likely to become the retail market of the future. Kolkata, along with Patna, Bhubaneswar and Siliguri, has come a long way in terms of retail maturity with various national and international brands foraying into these regions. Prominent retail chains like Spencer’s, Aditya Birla Group, Shoppers Stop, Future Retail, Pantaloons, have established themselves as premium retail leaders and have been operating successfully in this region over the last few years. And since the new generation in these areas is brand and quality conscious – be it for clothes or food – the retail market is working hard to meet their growing expectations. The opportunity in this market is immense.”

“East India market has grown a lot in the last three years, majorly the cities of Siliguri, Guwahati, Ranchi, Dhanbad where a number of retail projects can be seen coming up. Opportunities are immense in Tier II & III cities as well. We’re confident our brand will be able to tap into these opportunities in the next two to three years,” adds Reeshab Agarwal, Business Development Head, Stellar Furnishing & Schillere Furniture.

The Challenges

While the Eastern rising makes for an inspirational story, the reality of the retail sector is that – while growing at a fast rate – many challenges still exist. The sector still has a long way to go, with retailers pinning their hopes on central and state aid – both in terms of investment as well as in implementing better policies.

“In terms of opportunities there is a scope for new brands as there aren’t too many national brands so more space for innovative specialty restaurants.

However, availability of proper locations and quality manpower still remains a challenge,” says Debaditya Chaudhury.

Lack of trained work force and low skill level for retailing management are issues that worry him, he says, adding, “Hospitality sector is one of the labor-intensive industries, but the availability of trained manpower from chefs, to managerial staff and other kitchen staff is quite low in comparison to other cities. Moreover, the industry experiences the highest attrition rate as professionally trained manpower is moving to other metropolitan cities for better career opportunities,”

Apart from this, retailers across the board feel that quality retail education is necessary to create a vast pool of qualified retail management professionals who can tackle the challenges of this intensely competitive industry. East needs to develop a comprehensive retail management programme and environment that enables retailers and the youth to critically analyse the retailing process.

Absence of a developed supply chain and integrated IT management also hamper the retail process in the region.

“Logistics is the biggest bottle neck in our industry. Fashion has to be delivered instantly. There are many operational challenges in the logistics industry, which is frustrating at times,” states Malini Singhal.

Devansh Binani adds to this saying a major challenge is to get trained manpower since the retail industry involves a loads of technical know-how and there are not enough training institutes in the Eastern region of the country. “Hiring and retaining technical manpower is not cost effective in the East,” he explains.
Manish Kedia & Mohit Kumar Bhati, Co-Founders & Directors of Dumpling Momo strike an optimistic note saying, “Except the growing competition among brands – which we believe should always remain to keep the vision high – there seem to be no other bottlenecks as far as we’re concerned. In fact, we think the East is full of opportunities for us.”

Vivek Prabhakar of Chumbak agrees, saying, “Our foray into the East has been one that has exceeded our expectations, both from a business perspective as well as a customer engagement one.

There are immense expansion opportunities that exist in the region. Apart from Kolkata and Bhubaneswar, where we’re already present, we have shortlisted more cities of interest specifically Guwahati, Patna, Ranchi that are of interest to us.”


The retail sector is India is the second largest employer after agriculture. In East, the sector used to be highly fragmented and predominantly consisted of small independent, owner-managed shops. In the last decade or so, the region has slowly eased into the groove of modern trends. Rapid urbanization has boosted consumer demand in the fields of fashion, F&B, and luxury – which in turn has given an impetus to retail growth.

The advent of mall culture and coming of organised brands has helped the modern retail sector grow in East India. The region is most commercially viable and holds immense potential for the retail sector since there is scope for growth in Eastern regions because various significant markets are still unexplored. East India is the land of opportunity, full of potential and promises for the retail industry.

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