Lack of retail space as the prices of real estate has been on the surge due to

the increase in demand from the Indian organized retail sector

Shelling out more money for the retail space directly implies less profitability
with which the new retailers will have to compromise
Shortage of trained manpower is a difficult task and the retailers have to pay
more for their retention. This brings down the profit levels
Underdeveloped Supply Chain Capabilities due to poor infrastructure facilities
acts as an impediment to growth and expansion
IT Infrastructure Hurdles makes the inventory and billing management
tedious and unnecessarily lengthens the business process negatively
affecting its efficiency
Inadequate Utilities :

Limited Consumer Insights stifles the innovative ways by which retail industry
could fulfil the latent needs of the customers and capture the market share
Taxation Challenges -The government havent introduced a uniform taxation
system across the country to relax the law that hinders interstate flows of
goods
Insufficient Government Incentives and Supply Base (vendor) Hurdles are
also creating unfavourable conditions for starting business in this segment.
High Stamp Duties makes the transfer of properties difficult and affects the
industry. Price War between different retailers Every one is saying to provide
goods at low cost and offers various promotional schemes. In such a case it is
difficult to keep ones customers with oneself
Presence of rigid Pro-tenancy laws makes it difficult to evict tenants and this
is creating problems.