Transcript No Slide Title

Retail Revolution in India & its impact
in the Middle East
Presented by:
Mr. B. S. Nagesh
Customer Care Associate & MD
India Retail Report 2005 – Highlights
Images Retail Study 2006 (collation from various data sources)
2001
2005
Consumption
Expenditure
USD 310 Bn
Consumption
Expenditure
USD 410 Bn
32%
The Entire Retail Sector
USD 198 Bn
The Entire Retail Sector
14%
Organized Retail Sector
Organized Retail Sector
USD 3.96 Bn
Share of Organized Retail
2%
USD 226 Bn
93%
USD 7.68 Bn
Share of Organized Retail
3.4%
Organized Retail - 2010
2005
2010
Organized Retail
Organized Retail
USD 7.68 Bn
Share of Organized Retail
3.4%
304%
USD 31 Bn
Share of Organized Retail
10%
Rising Consumer Income
Key Driver
1995 -96
URBAN
The very rich
The consuming
class
0.8 (5)
1.2 (7)
16.6 (93)
32.5 (186)
16.8 (94)
54.1 (312.2)
2001 - 02
2006 - 07
1.9 (11)
4.0 (23)
2.6 (15)
26.5 (150)
46.4 (265)
17.4 (98)
74.4 (429)
5.2 (30)
40.8 (230)
75.5 (432)
13.7 (77)
81.7 (472)
The Climbers
0.7 (4)
7.1 (40)
The aspirants
44.0 (253.9)
5.3 (30)
33.0 (190.4)
The destitute
Figures in Mn: Households (Population)
3.9 (22)
33.1 (192)
2.6 (16)
20.2 (117)
0.9 (5)
24.1 (140)
16.5 (95)
Source: BW Marketing Whitebook 2003-04
Future Outlook of the Organized Retail Market
(Images Retail Study 2006)
• The next 3 years will see
– US $560m investment for retail expansion
nationwide.
– Result in 50 Hyper Markets.
– 305 large Department Stores.
– 1500 Super Markets.
– 10,000 exclusive retail showrooms
– One third through conversion from multi-brand
to exclusive outlets.
• Largest growth in the field of entertainment with or
without shopping.
• Volumes in Food & Grocery, Office & Home
Utilities.
• Organized and traditional formats will co-exist.
Gold & Jewellery market in India
(Source: India Retail Report, 2005)
• Jewellery market, the largest market in the
world is estimated at US$ 9.7 bn.
• Gold contributes 98% of the above (approx. US$
9.5 bn).
• 65% of jewellery bought during weddings with
5 – 6 mn weddings happening in the country
every year.
• Organized jewellery retailing is at 2% of the
total market.
Branded Jewellery market in India
(Source: India Retail Report, 2005)
• Branding of Jewellery commenced in 1996 with
Tanishq.
• Branded jewellery retailing stands at US$ 0.26
bn and is growing at 40% p.a.
• Other major players are Nakshatra, Orra,
Oyzterbay, Gili, Asmi, Carbon, D’Damas.
• Brands sold at stand alone specialty stores and
department stores.
• Huge potential as 98% of market is still
unorganized.
Branded Jewellery market in India
(Source: India Retail Report, 2005)
• Key to the success of branded jewellery
– Huge footfalls in modern formats due
department stores being destination stores.
– Comfortable & attractive shopping experience.
– Reliability & quality from the perspective of the
customer.
– Brand exclusivity & wide range of designs.
– Malls are the preferred choice
– Recent phenomenon is the launch of Specialty
Jewellery, Gold Souk, near Delhi.
Jewellery Sales by Shoppers’ Stop
Indian Retail & Impact in the Middle East
• India is still the largest gold consuming country in
the world.
• Consumers are gradually shifting towards branded
jewellery but Gold continues to remain high on the
consumers’ fascination.
• A shift in preference to Department Stores and
specialty stores for purchases.
• With organized retail in India growing at 30% per
annum, the trend towards purchase of Gold &
Jewellery by Indians is shifting to Malls & Specialty
stores in India.
Impact on the Middle East
• Outbound tourism impact
– Will continue to attract tourists from India as Middle
East Gold (retailer) more trusted than Indian Gold
(retailer).
– With Modern retail evolving at a fast pace in Middle
East, will attract more Indian tourists for shopping.
• Indian retail would be fully evolved in the next 5 yrs,
products likely to be cheaper in India by way of local
sourcing & tax reforms.
• Many Middle East retailers being of Indian origin, a lot of
Middle East business houses would enter India.
• A reverse drain of people from Middle East to India
expected, Middle East will feel the heat of manpower
shortage & cost escalation.
Conclusion
• Emerging India to boost Middle East retail for the
next 5 years.
• The same emerging India to take away a share from
Middle East in the next 5 to 10 years.
THANK YOU