Organized retailing is a latest and ongoing advancement. It refers to the trading activities of licensed retailers who are registered for income tax, sales tax etc. These include retail chains and hypermarkets backed by corporates and privately owned retail businesses. With socioeconomic factors playing out a crucial role in the buildup to organized retailing, India is currently standing on the threshold of a retail revolution.
The Retail Industry is one of the rapidly evolving industries that is replete with vibrancy and dynamism. It has significantly reinforced the economic growth and development of our country in a very short span of time.
Varying demographic patterns, improving economic prosperity, increasing disposable incomes, proliferating Indian manufacturing firms and changing consumer likes and preferences are key to driving success in the domain of Indian organized retail sector.
Here are 9 top factors at the helm of the rise of organized retailing.
With the stupendous rise in consumerism, the retailer is challenged with a more intelligent and demanding consumer. As a business exists with the prime objective to placate consumer needs and preferences, the amplifying consumer expectation has compelled the retail companies to change the business model of their retail trade. Consumer demand, comfort, convenience, time and location are the critical decision makers for the evolution and expansion of organized retailing in India.
The recent years have observed a rapid growth in the number of middle-class consumers. The burgeoning demands, better disposable income among the consumers and improvements in infrastructure have offered the retail industry an elbow room to develop and flourish.
The consumers expect the finest quality products at affordable prices. Offering a broad variety of goods and value-added services to the consumers is what modern retailers strategize on.
The development of consumerism that has predominantly enlarged the consumer markets and accelerated the confluence of consumer tastes would be a vital success driver for Indian organized retail.
The modern Indian women are literate, knowledgeable and qualified. They keep up an excellent balance between their home and work. The buying propensity of working women is out-and-out different from the homemakers. Because of their time constraint for leisure and relaxation, they insist on engaging in a seamless one-stop shopping experience to satiate their needs and the whole shebang under one roof which the ultra-modern retail outlets offer.
Numerous dealers and distributors in India from the organized retail sector are able to appreciate the economies of production and distribution in large scale. They lean on eliminating intermediaries in their distribution channel. In addition, organized retailers provide decent quality products at acceptable prices. The tempting open door for ample profit is increasingly attracting entrepreneurs to enter into this breeding sector by setting up retail companies in India.
In the present times, the rural market in India is confronting fierce competition in the retail sector as well. The rural consumers have also become extremely quality conscious. To capitalize on this development organized retailers are creating new strategies to fulfill and deliver the needs of the rural customers. After agriculture, it’s the retail industry that is growing a deep penetration into rural India and proving to be the country’s next big source of employment.
Eminent business moguls like Tata, Birla, Reliance etc. have entered and taken the retail sector by storm. They provide products and entertainment with quality par excellence. Other prominent corporates like ITC, Piramal, RPG Enterprises and retail heavyweights like Shopper’s Stop, Pantaloons and Crosswords have completely revolutionized the Indian retail landscape.
The Indian retail sector has caught the attention of even foreign retailers like never before. Because of considerable liberalization, many well-known multinationals are poised to make successful inroads through moneymaking joint ventures and franchising thereby majorly boosting organized retailing.
Case in point is the world-renowned furniture retail giant Ikea that has recently opened its colossal 400000-square-foot retail store in Hyderabad. Ikea is “get up and go” to fulfill its ambitions in expanding their footfall in other metros like Delhi, Mumbai, and Bangalore in the next couple of years. The company has plans to set up around 25 stores by 2025.
Technological innovation is a dynamic aspect that has propelled organized retailing to greater heights. With the influx of digital information system, internet, explosion in electronic and social media, satellite television, digital marketing and popular unique technologies like big data, artificial intelligence, bar coding, Blockchain etc. have not only increased consumer awareness about products and services but also enabled retailers to sell online products in a transparent and profitable manner.
The rise in literacy level has come about in an increase in the average income of the general populace. This growth is observed not just in cities, but in towns and rural areas as well. Increase in income levels, heightened spending habits and enhanced literacy rate among consumers have led to the genesis of a new retail structure to meet the ever-growing demands for improved quality goods and services.
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