Retail Industry

Industry Analysis
 Evolution of the Industry
Traditional formats:
Emerging Formats –
1) Itinerant salesman 1) Exclusive retail outlets
2) Haats 2) Hypermarkets
3) Moles 3) Internal retail
4) Mandis, etc 4) Malls / Specialty malls
5) Multiplexes
6) Rural oriented formats
Established Formats – 7) Fast food outlets
8) Service galleries etc
1) Kirana
2) Convenience / Department stores
3) Company / Multi brand showrooms
4) PDS / Fair Price shops
5) Co-operative stores
6) Pan / beedi shops
 Growth of the
Industry
• Haats, Mandis and Melas have always been a part of the Indian
landscape.

• PDS or the Public Distribution System would easily emerge as

the single largest retail chain existing in the country.

• The Khadi & Village Industries (KVIC) was also set up post
independence. Today, there are more than 7,050 KVIC stores
across the country. 

• Initial steps towards liberalization were taken in the period of

1985-90. It was at this time that many restrictions on private
companies were lifted, and in the 1990’s, the Indian economy
slowly progressed from being state led to becoming ‘market
friendly’.
Scope of Retail
Industry

Retail Industries work in the sale of goods and

provide services to the customers. Products sold by7
the retailers include jewelry, housewares, electronics,
groceries, small appliances, etc.
The volume of the retail industry in the market
reached a value of nearly about $20331.1 billion in
2020, it has been increased at a compound annual
growth rate of 2.4% from 2015. The market of the
retail industry is expected to grow at 7.7% from 2020
to reach $29,446.2 billion in 2025.
The Key Success Factors
 Catering to customers
 Producers and wholesalers also must fulfill their duties.
 Provide offers to the customers in intervals of times.
 Market position
 Diversifications
 Operating Management
 Adequate stocks available
 Maintain good relationship with customers
Factors about the growth
 Growth of middle-class customers.
 Increase in the number of working women.
 Value of money
 Entering the corporate world
 Entry into the foreign retailers market.
 Technological impact.
STAKEHOLDERS (RETAIL INDUSTRY)
•1. The First Level: Contribution: CUSTOMERS-Customers: Customers are actors who are the utmost contributors to a
retail business process through their patronage of retail shops.
•2. The Second Level: Source
•Suppliers: Suppliers are providers of merchandise to be sold, display fixtures, storage and other retail supplies. They
supply resources to ensure the success of a retail operation.
•3. The Third Level: Market
•Competitors (Neighborhood retailers) : They are competitors who share the target market and resources with pop-
up retailers. Neighborhood retailers include all retailers that are in close proximity of a pop-up shop and that may
have a similar brand positioning. This can include independent shops, international chain stores, and even e-
commerce operations.
•4. The Fourth Level: Community
•Stake: Taxes and GDP
•Governments can also be considered a major stakeholder in a business, as they collect taxes from the company
(corporate income taxes), as well as from all the people it employs (payroll taxes) and from other spending the
company incurs (sales taxes). Governments benefit from the overall Gross Domestic Product (GDP) that companies
contribute to country.
 Market
Concentration

 Retail industry is largely unorganized. However, the

organized retail market has increased by 50%
between 2012-2020 to its current value of nearly 12%
of total retail.
 The modern Indian retail industry is expected to grow
at a 15% CAGR to reach 18% by 2025

In pandemic E-Retailing has increased and FMCG

sectors has also widen up
Market Share Of Retail In India
Company Name Market Share
Walmart 45 %

Reliance Group 20 %

Amazon 22 %

Future group 7%

6%
Others
 Basis of Product Differentiation

PRICING MARKET QUALITY COLOR BRAND

POSITIONING IMAGE
 Competitors
More than 500 companies, stores and shops are
there.

Entry And Exist

 Companies doing huge investment can enter

into market

 Companies which don’t do innovation or in

debt get exit

 For E.g. Future Group

 Profitability
• Walmart tops this
ranking with the profit of
$129 billion

• In Retail Industry,
Profitability depends upon
ability to sell to and
through their customers
across a variety of
channels.
 Operational Efficiency

BETTER TRAINING SET THE KRA’S ENHANCE THE MANAGING OF

TO THE PERSONNEL LAYOUT INVENTORY SYSTEM
 Technological Innovations

INVENTORY CONTROL VIRTUAL FITTING ROOMS CRM SOFTWARE

 PESTLE
ANALYSIS
Political Factors Affecting Retail Industry

Government Regulation & Political Influence

• The government and the politicians work in

collaboration to devise rules and regulations, the
citizens, businesses and the retail industry has to
follow them.

• If the government raises sales taxes, then it would

increase the prices of the product and services Such
laws can seriously impact the profit and revenue of
businesses.

• If the political environment of the country changes like

protests, roadblocks or bans, then it would disturb the
supply chain of products and services. Therefore,
businesses cannot run their operations smoothly, if
there’s a conflict in local politics.
Social Factors Affecting the Retail Industry

• E-commerce retail stores offer products and services to the customers based on shopping patterns and the time that the
customer spends online. Whenever a customer visits the store next time, the software would provide him the information
based on the data of previous searches.
• Society and social trends develop the shopping habits values of people, their attitude and behaviour may change and
transform because of many factors.
• Choices and preferences also vary with gender, age, and other factors.
• Demographic social factors like age, gender, race, income level, and education level of customers affect the business of
retailers.

Economic Factors Affecting Retail Industry

The economy of a country creates an environment and mentality of the people, whether to spend or not. If the economy is good and
people have jobs and sources of income, then they would be able to spend.
They encourage customers to spend their money, instead of holding on to it and buying what they need. Such an economic mindset
grows economic activities.
Legal Factors Affecting Retail Industry

• A retail store operates within the legal environment of a country ,therefore, it has to follow the principal, local labour laws, excise and
taxation regulation, and other business laws.
• When a brand plans to go globally, the rules and regulations become a bit complicated. It’s because every country has different copyrights, trade
and tariff laws.
• If a business decides not to follow the local rules and regulations of certain or many countries, then it would result in ban, restrictions, bankruptcy
or foreclosure of the business. Therefore, the business must obey a country’s laws.

Technological Factors Affecting Retail Industry

• Businesses have to adopt hardware and software technology to keep moving with time ,Whether it’s an online retail store or a physical
shopping mall, technology has influenced them both equally .It could be in the form of producing sales reports, cash management, or management
of the store’s sales record.
• Ecommerce stores are the ones that helped from the technology the most. Especially with the help of the internet, online retailers can advertise
their products and services globally without any restriction of borders.
Environment Factors Affecting Retail
Industry
• As we know that such items can’t remain fresh for a long
time in a certain environment, there’s a time limit on
them. After that, they’ll be expired or spoiled.
• Therefore, a retailer has to follow local legal and
economical factors.
• If a retail store doesn’t maintain a standard healthy
environment within the store, then food and safety
departments would either ban or impose some penalty
of a certain amount on the store.
• The other environmental issue some companies have to
face is the expiration dates of products and removal of
the contaminated stock. Companies have many
suppliers who provide products with different expiring
dates when sales staff put them on the rackets.
 SUMMARY
Retail Industries work in the sale of goods and provide services to the customers.
Products sold by7 the retailers include jewelry, housewares, electronics, groceries,
small appliances, etc.
The volume of the retail industry in the market reached a value of nearly about
$20331.1 billion in 2020, it has been increased at a compound annual growth rate
of 2.4% from 2015. The market of the retail industry is expected to grow at 7.7%
from 2020 to reach $29,446.2 billion in 2025.
PESTEL ANALYSIS
POLITICAL-the government and politician works in collaboration to set rules and
regulation and customer ,retailer must follow them
ECONOMIC-Encourage customer to spend there money instead of holding.
SOCIAL-Choices and Preference vary with Demographic factors
TECHNOLOGICAL-With the help of internet retailer van advertise without any
boundary fear.
LEGAL-When a brand plans to go globally, the rules and regulations become a bit
complicated. It’s because every country has different copyrights, trade and tariff
laws.
Market Share of retail industry
 Walmart-45%
 Reliance GROUP -20%
 Amazon-22%
 Future Group-7%
 Others-6%
Evolution
Retailing started from barter system.
It initially started as Moles ,Mandis popularly known as Traditional format
Then it converted to Kirana, Departmental store etc known as established format
whereas multiplex and service galleries etc are emerging format.
 
Thankyou