Retailing as we can say is the sale of
goods or assets from a fixed or particular place, such as a department store,
in small quantities for direct consumption by the purchaser. Retailers are at
the end of the supply chain. Vendors of production products consider the retail
process a necessary part of their overall distribution strategy as retailing
provides them a reach to the market without which the company or product has no
life. Globally, the contribution of retail sector to the world’s GDP is almost
about 27%. Now, if we talk about
the retail industry in India, we can say that it is undoubtedly one of the fastest
growing retail industries in the world. Being the largest of all industries and
accounting about 10% of the country’s GDP, it employs about 8% of the workforce.
In India, there has been seen a drastic commercial revolution in terms of
purchasing behaviour of consumers that is a modernization and development from
shopping malls to multi-storey shopping malls that offer shopping, entertainment
and food under one roof. It is because of this trend that the retail sector is
witnessing a revolution like many new formats markets such as hypermarkets, supermarkets
and department stores. India was also the main supply destination in the world
in 2016-17 and participation in this category is 55 percent. In India, much of
the middle class and even the untapped retail market is an attractive force for
all retail giants worldwide. Our active population with an average age of below
25 years, along with emerging opportunities in the retail sector, is one of the
main growth factors in the Indian retail sector. Growth in the retail sector is
positively expected, as many new entrepreneurs are entering the retail sector. The
total retail industry is estimated at 9 lakh crore, of which the organized sector
represents only 9 percent, indicating a large potential market opportunity. India’s
retail sector is experiencing accelerated growth and retail development is
occurring also in Tier-II and Tier-III cities and not only in large cities and
metropolitan areas, which people presume it to be growing. The purchasing power
of the consumer plays an important role in the decision making or the lifestyle
of the people and here we can see that the purchasing power of the Indian
consumer is growing in categories such as clothing, cosmetics, footwear, watches,
drinks, food and even jewellery. Due to the expansion of the middle men following
their purchasing power and the ease of doing business where there is a
simplified tax structure after the introduction of the Goods and Service Tax,
India can foresee and expect growth in the Retail Industry.

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The Indian
retail industry is one of the fastest growing industry in the world. India’s
retail sector is expected to grow to $ 1,100 billion in 2020, from $ 672
billion in 2017.


India is the
fifth favorite retail destination in the world. The country is among the
highest in the world in terms of availability of stores per capita. The Indian
retail sector is experiencing an exponential growth and retail development is
occurring not only in large cities and metropolitan areas, but also in level II
and III cities. This growth and development proportionally increases the size
of the retail market as well. Healthy economic growth, an evolving demographic
profile, an increase in disposable income, urbanization, tastes and changing
consumer preferences are other factors behind the growth of the retail market
organized in India. Even the online retail market is expected to increase from
$ 14.5 billion to $ 60 billion between 2016 and 2020.


Global retailers
such as Walmart, GAP, Tesco and JC Penney are increasing their purchases from
India and are moving from third-party purchasing offices to establish their
fully-managed and fully managed purchasing and purchasing offices.


The Indian
government has introduced reforms to attract foreign direct investment (FDI) in
the retail sector. The approval of Government for 51% FDI in multi-brand
retailers and increasing the limit of foreign direct investment to 100% in the retail
stores of a single brand is a sign of boost for increasing the market size of
retail and attracting Global retailers. We can see that global retailers such
as Walmart, GAP, Tesco and JC Penney are increasing their purchases from India
and are moving from third-party purchasing offices to establish their
fully-managed and fully managed purchasing and purchasing offices.


The retail sector consists of many
various segments out of which some important ones are Food and Grocery, Apparel,
Jewellery, Consumer durables and IT, Furniture and Furnishing, Pharmacy and
footwear. The year 2017 was favourable for the herbal-ayurvedic brand and hence
in upcoming years there are prospects for increase in the growing herbal


Key Drivers of Indian Retail Industry’s
Growth are:

Large working populations

More of nuclear

Double Income

Luxury spending

Easy customer


Lifestyle changes
and consumer behaviour

Liberations in
FDI policies


Reasonable real
estate prices


The retail industry can be classified
into two categories:


Organized Retail


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