Sugar

SHOPPERS STOP-TARGETING THE YOUTH

ISSUE ANALYSIS:

INDIAN RETAILING:

The value of Indian retail market is INR 12, 781 billion. India is considered as the home of retail outlets with world’s highest number of retail outlets. This is evident in case of pantaloons. Pantaloons, despite having sales of INR35.63 billion as revenue still contributes only 0.3 per cent to the national market share. More than 85 per cent of India’s retail outlets were so-called mom-and-pop establishments.

In 2006, India’s share of organised retail was INR530 billion. India’s share of organised retail was expected to grow to 10 per cent by 2010 and to 20 per cent by 2020. The imminent rise was mainly because India was in the middle of a retail revolution that had no parallel in economic history.

At a more basic level, four factors were driving the retail revolution in India change in demographics, an upward migration of income, easy availability of credit, and government impetus.

Change in demographics:

35 per cent of Indians were younger than 15 years of age and70 per cent were younger than 35 years of age. Because young customers had a high propensity to consume, high tendency to consume the profitable consumer base in India has a promising destination for global retailers.

Upward migration of income:

The middle income class, known as the real consumers, currently comprise 24.5 per cent of the total households, but was expected to increase to 32 per cent of the total households by 2010. This large and growing consumer class was also witnessing a shift in attitude from saving from money to spending money. As a result, a consumption boom was in the offing in India, fuelling the growth of Indian retail for the next few decades.

Easy availability of credit:

Indian consumers are under-leveraged for decades, having financed all their purchases through cash. During mid-1990’s commercial banks started promoting credit cards. By this both consumer spending and...