Some maths to chew on.
Big Bazaar has 27 outlets. Food Bazaar has 42 outlets ( An Electronics Bazaar planned in 25 of these outlets ). Vishal Mega Mart has 29 integrated stores. Shoppers Stop has 19 outlets (now also one Hypercity in Mumbai ). And the wait is on for the Lion King Mukesh Ambani to arrive.
Lets turn back to page 1, chapter titled 'Disorganised' Retail. According to a Pricewaterhouse Coopers top honcho the number of traditional stores in India will increase from 6.9 million in 2004 to 7.8 million in 2007 and the growth will continue alongside despite the Malls and other forms of organised retail.
And that organised retail ( not shopping malls alone but all those glitzy stores whose Ads you see in the glossy supplements every weekend ) accounts yet for only 3 % of retail sales In India. The expected growth rate is 1% every year and by 2010 organised retail would be 10 % of all retail in India.
Ernst & Young say that out of the 220 Malls in the pipeline till 2007, 125 are in the top 6 metros.
If you havnt yet felt smug enough then please consider the AT Kearney's 2006 Global Retail Development Index which says that India has retained its no 1 position in the annual study of retail investment attractiveness amongst 30 emerging markets in the world.
So Ladies and Gentlemen ( Sanjeev please note ) the action has just begun. Please hold on to the edge of your seats for more.
8 comments:
there is a favourite theory of mine - you can call it replacement markets. when one lot of people (wealthy SEC A1 types) get tired of a mall they move on to a KL and then to some other exotic location. They are replaced by the ones who stood outside and gawked at the shoppers stop window. these are the ones to watch out, they will save and scrimp to buy a rs 299 ka teeshirt just for the experience and then as an habit. Remember what CK Prahlad said?
Thats what the retail is feeding, we are mere by standers in this malled culture
The "Retail Story" is just an illusion. Hype by the FIIs and developed nations.
A month ago, various studies showed India to be the hottest emerging market for investments.
Now there is blood on Dalal Street.
The "Retail Story" is just an illusion. Hype by the FIIs and developed nations.
A month ago, various studies showed India to be the hottest emerging market for investments.
Now there is blood on Dalal Street.
is it really sunil ? an illusion i mean ?
i don't wish to quote numbers here, but just have a general observation that when things around us change in relatively radical terms, there is always some blood spilt along the way. in the long run however, thats pretty much a miniscule thing.
once upon a "nanz" time, supermarkets were seen as expensive. they actually were not or they would have made money.
but today, i only have to look at the malls crawling with people even on weekdays. and the mad rush at big bazar.
the fact that for the indian consumer, shopping is a full scale family outing with oodles of touch-feel thrown in ( my client, sony india offers that facility for all its products ) gives me hope for the future.
and thats putting it mildly !!
look forward to hearing more from you.
hype or correct type ... time tests theories. human masses test theories. its only in hindsight that theories become correct or incorrect.
at the moment its only hypothesis of trends from some angles. The numbers game can be flipped to suit whichever perspective one would like to hook on to...
So whether retail is really gonna be in or out... time will tell. My hypothesis... maybe people get bored to shop and find other things to do to kill their time. What then? ;-)
that, ajit, is the subject for another blogpost ! may be we can collectively rack our brains to see and guess as to what could be driving people, say, 50 years from now.
i remember reading a sci-fi short story in my school years many aeons ago about the world in 2058.
people have these gigantic screens on in their homes which beam life to them. basically TV max-ed. they are sitting like morons in front of them, day in and out.
the streets are empty, concrete pavements have grass growing on them due to lack of use, and crime has been eliminated.
the story's protagonist who likes to just walk..is arrested by a robotic police car due to his abnormal behaviour and sent in to therapy to correct regressive tendencies !!
Dear Sunil:
Imagine yourself in a crowded bus in Old Delhi where two passengers get into an argument. One had (probably accidentally) stepped on the other’s foot. The conductor "bounced" them both out and you drove on while they continued scuffling on the street. When you returned that way two hours later, the police was out in force, a couple of buses had been burnt and curfew was being announced! The two idiots were members of different communities. Random bystanders got involved in the absurd quarrel and somebody got stabbed. It was 30-odd days before the violence ended. End of story.
The point here is that a small incident was amplified into the flashpoint for a huge explosion as people kept referring back to it and making it into a bigger and bigger deal. A guy called Karl Popper termed this phenomenon as 'reflexivity'. This is in fact not my own example ( I am quoting the very interesting Devangshu Dutta ) and this so clearly explains that in any market situation, the forthcoming trend of prices is influenced by current trends.
Prices rise, the optimists buy enthusiastically and prices rise again. Or prices fall, panic selling starts and prices fall further. Reflexivity is the reason why market trends overshoot equilibrium in both directions. As you may have noticed that prices rarely 'fair'. During a bull-run, prices always rise beyond the point of rational justification. In bear markets, they fall to absurd lows.
After the one-session crash of 17 May, 2004, the market indices rose 200 per cent in the next two years, reaching the dizzying heights of Sensex 12,670 on 11 May, 2006 not very long ago. A week later another massive sell-off occurred. We all know people who bought simply because the market was up. We all know people who’ve sold in panic because the market was down.
And while all the Dalal Street Drama was going on, Adidas, opened its 9000 sq ft flagship 'Sports Performance Centre' in Bangalore, Globus announced plants plans to hit Jamshedpur, Ranchi, Udaipur, Bopal, Meerut, Ludhiana, Mohali, Vijaywada, Mysore, Muradabad, Kochin, Nagpur, Lucknow, Jamnagar and Bhavnagar ( where is that, you would ask ?), Talwalkars, a gym with 38 outlets announced an IPO and Reliance poached one former MD of Lifestyle and 2 senior sourcing guys from Walmart ( YES !!!!)
If thats not convincing enough, my rock of Gibraltar of a father who once swore to live and die by his Punjab & Sind Bank grudgingly uses the Citibank ATM machine even though it has once swallowed his ATM Card. My husband went to service his Maruti Esteem yesterday and exchanged it with a new Baleno at the service center ( and I thought it used to be high involvement category ).
Dalal Street not withstanding the Retail Revolution is taking place under our very cynical noses and god willing both you and me will be around to watch the tide turn.
life is a long strange "trip" ...
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