印度零售业分析（12月）（英文）.docx

December 2018For updated information, please visit ibef.orgNote: IT - Information TechnologySource: Aranca ResearchIBEF xk INDIA BRAND EQUITY FOUNDATION lbef.orgCOMPETITIVE LANDSCAPE IN INDIAN RETAILSECTORRetailDepartmental storesHypermarketsSupermarkets/convenience storesSpecialty storesCash and carrystores Pantaloon has 209 stores. Westside operates 126 stores as of May 2018. Shoppers Stop has 83 stores in India, as of 2018. As of FY18, Reliance Retail launched 'Trends' in this format and currently has more than 3,300 stores across India. Pantaloon Retail is the leader in this format, with 259 Big Bazaar stores and online franchisees. Aditya Birla Retail (More Hypermarket)- 20 stores. HyperCITY(19 stores), Trent, Spencer's (Spencer Hyper), and Reliance are other players. Aditya Birla Retail- More Supermarket (523 stores). Spencer's Daily (120 stores). Reliance Fresh (502 stores). REI 6Ten (350 stores). Big Bazaar (259 stores). Titan Industries is a large player, with 438 World of Titan, 200 Tanishq and 470 Titan Eye+ shops. Vijay Sales, Croma and E-Zone are into consumer electronics. Landmark and Crossword focus on books and gifts. Metro started the cash and carry model in India; the company operates 24 stores across Mumbai, Kolkata, Delhi, Punjab, Hyderabad and Bengaluru. As of FY18, Reliance Retail operates 43 cash and carry stores called 'Reliance Market.Source: Company websites, Press ReleaseSTRONG GROWTH IN THE INDIAN RETAIL INDUSTRYIBE队INDIA BRAND EQUITY FOUNDATION ibef.orgMarket size over the past few years (US$ billion)2,000The retail sector in India is emerging as one of the largest sectors in the economy. The total market size of Indian retail industry reached US$ 672 billion in 2017. It is forecasted to increase to US$ 1,200 billion by 2021 and 1,750 billion by 2026. India will become a favourable market for fashion retailers on the back of a large young adult consumer base, increasing disposable incomes and relaxed FDI norms.Note: *CAGR for 2000-2016, F- Forecast, E- EstimatedSource: indiaretailing. com, BMI Research, Consumer Leads report by FICCI and Deloitte - October 2018ORGANISED RETAIL IN NASCENT STAGEIBEFAINDIA BRAND EQUITY FOUNDATION ibef.org As of 2017E, the traditional retail, organised retail and e-commerce segments account for an estimated 88 per cent, nine per cent and three per cent of the market, respectively. The organised retail market in India is growing at a CAGR of 20-25 per cent peryear. It is projected that by 2021 traditional retail will hold a major share of 75 per cent, organised retail share will reach 18 per cent and e-commerce retail share will reach seven per cent of the total retail market. The unorganised retail sector in India has huge untapped potential for adopting digital mode of payments, as 63 per cent of the retailers are interested in using digital payments like mobile and card payments.Note: E - estimate, F- Forecast, * - e-commerce market here refers to sale of products and services through electronic transactions, home shopping is considered a part of e-commerce Source: BCG, KPMG- indiaretailing , Deloitte Report, Winning in India's Retail Sector, Centre for Digital Financial Inclusion (CDFl) report, Crisil, Consumer Leads report by FICCI and Deloitte - October 2018SECTORS HIGH GROWTH POTENTIAL IS ATTRACTING INVESTORSIBEF xk INDIA BRAND EQUITY FOUNDATION lbef.orgFDI Confidence Index 2018India has occupied a remarkable position in global retail rankings; the country has high market potential, low economic risk and moderate political risk. India's high growth potential compared to global peers has made it more favourable. India is expected to become the world's third-largest consumer economy, reaching US$ 400 billion in consumption by 2025, according to a study by Boston Consulting Group. In FDI Confidence Index, India ranks 11th (after U.S., Canada, Germany, United Kingdom, China, Japan, France, Australia, Switzerland and Italy). India is ranked first in the Global Retail Development Index 2017, backed by rising middle class and rapidly growing consumer spending.Note: FDI - Foreign Direct InvestmentSource: AT Kearney 2017 FDI Confidence IndexRISING PROMINENCE OF ONLINE RETAILIBE队INDIA BRAND EQUITY FOUNDATION ibef.org Online retail business is the next generation format which has high potential for growth. Currently, it is estimated to be a US$ 50 billion opportunity. After conquering physical stores, retailers are now foraying into the domain of e-retailing. It had a market size of US$ 18 billion in 2017 and is forecasted to reach US$ 32.70 billion by 2018. Online retail market is estimated to reach US$ 60 billion by 2020. The online retail market sales is forecasted to grow at the rate of 31 per cent year-on-year to reach US$ 32.70 billion in 2018. It is projected to reach US$ 73.00 billion by2022F. India's ecommerce industry's sales rose 40 per cent year-on-year to reach Rs 9,000 crore (US$ 1.5 billion) during the five-day sale period ending September 24, 2017, backed by huge deals and discounts offered by the major ecommerce companies. It is forecasted to reach US$ 53 billion by 2018. The government plans to allow 100 per cent FDI in e-commerce, under the arrangement that the products sold must be manufactured in India to gain from the liberalised regime.Notes: APMEA - Asia/ Pacific, Middle East and Africa, F- ForecastSource: MasterCard Worldwide Insights 4Q 2010, ANAROCK, ASSOCHAM, UN Report 'The power of 1.8 billion', Nasscom annual guidance 2018, RedSeer Consulting, eMarketerIBEiINDIA BRAND EQUITY FOUNDATION lbef.orgSTRATEGIESADOPTEDSTRATEGIES ADOPTEDIBEFAINDIA BRAND EQUITY FOUNDATION ibef.orgStrong distributionand logisticnetworkIt is imperative for a retailer to have a strong distribution and logistic network to succeed in this sector. Players follow a distribution network that suits them the best. For example, Shoppers Stop follows a “hub and spoke“ model for its distribution network to increase efficiency and productivity.ExpansionAs of October 2018, Xiaomi opened 500 Mi stores in rural region of India. It aims to open 5,000 such retail stores all over the country by the end of 2019.Cafe Coffee Day (CCD) aims to expand its business by adding about 100 stores every year to have a network of around 2,500 stores in the next seven to eight years.To improve consumer outreach Amway India will open 25 new Xpress Pick and Pay (XPP) stores in India in 2018.On August 09, 2018 IKEA world's largest furniture retailer opened its first retail store in Hyderabad and it plans to open 24 more stores by 2025.Omni-channelretailingRetailers are opting for many channel to maximise sales, Omni-channel retailing is being adopted by many retailers in India. For example, Shoppers Stop is making efforts to be an omni-channel retailer. Ezone has launched an online platform, which has led to increase in sales.As of September 2018, V-Mart Retail aims to expand its business with omni-channel strategy to reach customers through online retail.CollaborativegrowthAs of October 2018, Procter & Gamble India (P&G India) launched Innovation Sourcing Fund, a multimillion-dollar fund to invest in Indian start-ups.Lowering pricesCertain retailers adopt 'first price right* approach. Retailers do not offer discounts under this strategy: they directly compete on the selling price by offering a best price without any markdowns.Offering discountsMost retailers have advanced off-season sales from 15 days to a month with discounts of 20-70 per cent on certain products. Also higher discounts and other value-added services formembers.Source: Company website, News ArticlesSTRATEGIES ADOPTEDIBEFAINDIA BRAND EQUITY FOUNDATION ibef.orgOffering value-added servicesCompanies offer innovative value-added services, like customer loyalty programmes and happy hours on shopping deals. Offers for senior citizens, contests for students and lottery gains are now very common.LeveragingpartnershipsTo keep customers on shop floors for a longer time and increase conversions, retailers are now pitching to partner with manufacturers, service providers, financial companies, etc. to create a buzz around certain product categories.Strong supplychainJoint VenturesCritical components of supply chain planning applications help retailers to maintain profit margins. Innovative solutions like performance management, frequent sales operation management, demand planning, inventory planning, production planning and lean systems can help retailers to get advantage over competitors.To diversify the product offerings and tab the growing luxury retail segment, retailers are forming joint ventures with foreign luxury brands. Reliance Brands Ltd. formed a joint venture with Bally, a Swiss luxury brand, to exclusively market its products in India.Changing theperceptionTo create perception that their store brands to have consistent and comparable quality and availability in relation to branded products. Retailers are providing more assortments for private level brands to compete with supplier's brand. New product development, aggressive retail mix and everyday low pricing strategy help to get edge over supplier's brand.Hyper-Personalisation Indian retailers use hyper-personalisation models based on behavioral data, brands performance, demographic preference and pin codes as marketing strategy which boosts sales.Cash-on-DeliveryOnline retail segment offers cash-on-delivery and manufacturers1 warranty to boost e-retailing in consumer durable sector.Cash-on-delivery is the most preferred payment option with over 30 per cent of buyers opting for it in India.Source: InternationalIBEiINDIA BRAND EQUITY FOUNDATION lbef.orgGROWTH DRIVERSRetailTable of Content卜Executive Summary3卜Advantage India5卜Market Overview and Trends7卜Strategies adopted15卜Growth Drivers18卜Opportunities26卜Key Industry Organisations29卜Useful Information31 IBEF <.-4c - 2 -*- -、,*，.二 为-IBEF xINDIA BRAND EQUITY FOUNDATION lbef.orgGROWTH DRIVERS FOR RETAIL IN INDIAIBEFA1Consumer preferences卜 India's per capita GDP increased to Rs 98,867 (US$ 1,534.01) in FY18 from Rs 93,888 (US$ 1,399.43). j Indian consumers are now shifting more towards premium brands by paying more for value and service.BrandConsciousness卜' Factors like young demographic composition, increasing personal disposable income, more preference towards V affordable luxury and rising middle class population are developing preferences for specific brands.Consumer Finance Opportunitiesk Consumers have become more comfortable using online services due to demonetisation.， Online retail segment provides various credit and payment options driven by increasing internet penetration, speed, 24- ， hour accessibility and convenient and secured transactions.FDI Approvalsk Department of Industrial Policy and Promotion (DIPP) approved three foreign direct investments (FDI), Mountain Trail Food, Kohler India Corporation, and Merlin Entertainments India in the single brand retail sector. The DIPP has approved two FDI proposals worth more than Rs 400 crore (US$ 62.45 m川ion) within the retail sector.Investments卜 Beccos, a South Korean designer brand is set to enter the Indian market with an investment of about Rs 1.00 billion k(US$ 14.25 million) and open 50 stores by June 2019. " Walmart Investments Cooperative U.A has invested Rs 2.75 billion (US$ 37.68 million) in Wal-Mart India Pvt Ltd. India's retail sector attracted Rs 9.5 billion (US$ 147.40 million) investments in FY18, at a growth rate of 35 per cent Jyear-on-year from Rs 7 b川ion (US$ 104.34 million) in FY17.INDIA BRAND EQUITY FOUNDATION lbef.orgSource: News Articles, Ministry of Statistics and Programme ImplementationGROWTH DRIVERS FOR RETAIL IN INDIAINCOME GROWTH TO DRIVE DEMAND FOR ORGANISED RETAILIBE队k INDIA BRAND EQUITY FOUNDATION lbef.orgGDP at current prices (US$ billion)GDP per capita at current prices (US$)o40923,00000220069。:6L6寸 6ooooooooooo oooooooooo 0864208642, , , , 3 ,2 11111FY17 FY188 T- F 7 T- F 6 1. F 5 1. F 4 F 3 Multiple drivers are leading to strong growth in Indian retail through a consumption boom. Significant growth in discretionary income and changing lifestyles are among the major growth drivers of Indian retail. Easy availability of credit and use of *plastic money* have contributed to a strong and growing consumer culture in India. Acceptance and usage of e-retailers by consumers are increasing due to convenience and secured financial transactions.consciousness. Expansion in the size of the upper middle class and advertisement has led to greater spending on luxury products and high brand In FY18, GDP at current prices was US$ 2,848.23 billion and GDP per capita at current prices was US$2,134.8.Source: IMFFDI POLICY DETAILS ON SINGLE AND MULTI-BRANDRETAIL IN INDIAIBEF xINDIA BRAND EQUITY FOUNDATION lbef.org51 per cent FDI inmulti -brand retailStatus: Policy passed100 per cent FDI insingle brand retailStatus: Policy passed Minimum investment cap is US$ 100 million. 30 per cent procurement of manufactured or processed products must be from SMEs. Minimum 50 per cent of total FDI must be invested in backend infrastructure (logistics, cold storage, soil testing labs, seed farming and agro-processing units). Removes middlemen and provides better price to farmers. Development in retail supply chain system. 50 per cent of jobs in retail outlet could be reserved for rural youth and a certain amount of farm produce could be required to be procured from poor farmers. To ensure the Public Distribution System (PDS) and Food Security System (FSS), the government reserves the right to procure a certain amount of food grains. It will keep food and commodity prices under control. It will also cut agricultural waste as mega retailers would develop backend infrastructure. Consumers will receive higher quality products at lower prices and with better service. Products to be sold under the same brand internationally. Sale of multi-brand goods is not allowed, even if produced by the same manufacturer. 100 per cent FDI allowed in single-brand retail under the automatic route. Single brand retail entities have been allowed to set off their incremental sourcing of goods from India for global operatio