PRESENTATION ON
FOOD & GROCERY SECTOR IN INDIA
By Arijit Ghosh, Saikat Biswas, Bidyut Mondal & Rounak Basu
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OVERVIEW - SECTOR ANALYSIS
• MARKET SIZE - The food and grocery (F&G) market is the
biggest retail segment in India.
• GROWTH - The total food and grocery retail market has
been growing at a CAGR of 14 percent and is estimated to
grow at 17 per cent per annum by 2015.
• The food and grocery segment is the highest contributor to
the retail sector (60%) with minimum penetration of
organized Retailing.
• Hypermarkets and supermarkets are the best suited retail
structure for this segment.
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RETAIL MARKET IN INDIA
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THE EVOLUTION
• HAATS, MANDIS, BANIA SHOPS
Till 1990
• APNA BAZAAR, KENDRIYA BHANDAAR
1990’s
2000-2011
• SUBHIKSHA , MORE , SPENCER’S
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CHANGES IN MODERN TIMES
NOT STACKED WELL STACKED ITEMS
200 Sq.Ft. LOCATION CLEAN ENVIROINMENT
ONLY DRY ITEMS FRESH STOCK
DAILY ITEMS ONLY TRANSFORMATION MORE VARIETY
DIS.ON TOTAL COST LESS PRICE
NO PARKING PARKING FACILITY
NO LOYALTY LOYALTY
PROGRAMS PROGRAMS
NO USE OF BARCODE SYSTEM
TECHNOLOGY
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CURRENT SCENARIO
CUSTOMER PROFILE:
Husband & Lives in metro
wife both city or tier 1
working city
Age group 20-
Owns a Car
40
Reads
High
newspaper &
disposable
Uses internet
income
Likes Mall Brand
Culture Conscious
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CURRENT SCENARIO
COMPETITOR ANALYSIS:
KIOSKS SABZI MANDI KIRANA SHOP STREET VENDORS
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CURRENT SCENARIO
INDUSTRY GROWTH RATE: Food and grocery retail
industry is expected to have a grow at a rate of 30 %
• US $ 70 billion
2011
2025 • US $ 150 billion
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STRATEGIES EMPLOYED
STRATEGIES FOR PROMOTION: ADVERTISEMENTS
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STRATEGIES EMPLOYED
STRATEGIES FOR RETENTION: LOYALTY PROGRAMS
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TECHNOLOGY USED
MODERN & NEW TECHONOLOGY: In the organized food & grocery retail
COMPUTERIZED BILLING COUNTERS can be seen.
Moreover some of the big retail stores like big bazaar use modern
technology AND techniques for managing their supply chain.
VENDOR RELATIONSHIP MANAGEMENT(VRM)
ENTERPRISE RESOURCE PLANNING(ERP)
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ORGANIZED & UN-ORGANIZED RETAILING
The food and grocery segment is the highest contributor to the
retail sector with maximum contribution coming from traditional
retailing.
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E- GROCERY MARKET IN INDIA
Market Segmentation Distribution
Other Indian
40% Unorganiz
Retail Organized ed
Food & Market, 8% 92%
Grocery $500 Bn
60%
E-COMMERCE
Expected Sales Growth (USD Bn) •Globally, e-grocery market is growing nearly 7 times
10 8.8 faster than on-ground format
•India is the sixth largest grocery market in the world
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1.6 •Indian e-grocery market growing at a rate of 19% YoY
0
•30-40% of the business will be in the online retail
FY12 FY16 space in the next 5 years
Source: Technopak, Deloitte report, D’Essence analysis
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INTEGRATED SUPPLY CHAIN MODEL
Whole Seller Manufacturer
Procurement
Call Center
Customer Order gets Deliver it to
processed at Customer
Warehouse
Online Portal
Source: D’Essence analysis
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MARKET OPPORTUNITIES
IN FOOD AND GROCERY RETAIL
• Indian household spending on food is one of
the highest in the world.
• Acceptance to modern retail this sector
exhibit huge untapped potential.
• Which gives a wider scope for the upcoming
Retailers to tap the untapped segment.
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ETOP: Environmental Threat and
Opportunity Profile
Environmental Sectors Nature of Impact of each sector
Impact
Growing affluence among urban
Economic consumers, rising disposable
incomes & living standards
Organized sector a virtual
Market oligopoly, overall industry growth
rate not encouraging,
Global imports growing but India’s
International share shrinking
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ETOP: Environmental Threat and
Opportunity Profile
Environmental Sectors Nature of Impact of each sector
Impact
Political Pressures, Local antisocial
Political
Government assistance, such as
government-backed loans and
Regulatory
subsidies, imposing regulations
that increase costs,
Changes in social values and
trends impact, socially responsible
Social
business practices,
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ETOP: Environmental Threat and
Opportunity Profile
Environmental Sectors Nature of Impact of each sector
Impact
Collaboration Becomes Key To
Success For Retailers And
Supplier Suppliers.
The difference between the
winners and losers in retail
Technological increasingly comes down to one
factor: tech savvy.
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SOME OF THE KEY PLAYERS
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Right now there is no particular type of retailer that perfectly suits
the market.
- Toshifumi Suzuki
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