India‘s retail market, valued at US$ 353 billion in 2010, is projected to grow at a rate of 12 per cent per annum. India has one of the largest number of retail outlets in the world. The sector is witnessing exponential growth, with retail development taking place not only in major cities and metros, but also in Tier-II and Tier-III cities.
The organised Indian retail industry has also begun witnessing an increased level of activity in the private label space, which is expected to grow further in the near future.
Food is the largest segment in terms of its contribution to the total value of the retail market, followed by fashion and fashion accessories. The share of organised retail in the total Indian retail trade pie is projected to grow at 40 per cent per annum. Real estate development in the country, for example, the construction of mega malls and shopping malls, is augmenting the growth of the organised retail business.
There are retail opportunities in most product categories and for all types of formats in India. Organised retail formats, including departmental stores, hypermarkets, supermarkets and specialty stores, are fast replacing traditional retail formats such as kirana stores (small ‗mom-and-pop‘ general stores) due to rising consumer expectations.
Currently valued at US$ 3.5 billion, the Indian luxury retail market is expected to grow to US$ 30 billion by 2015, an estimated growth rate of 25 per cent per annum, making India the twelfth-largest luxury retail market in the world.
Retail and fast-moving consumer goods (FMCG) players have begun devising exclusive marketing strategies to tap the rural consumer base. Rural India accounts for more than 70 per cent of all Indian households and close to two-fifths of the total retail consumption pie. Retail companies have realised the importance of tapping the rural consumer base.Sectoral Presentation (November 2010)
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