Growth and

Opportunities in the
Retail Market
 Market Study of Retail
1. The retail
2. Increase in
•Current/Future market in India is
consumer
Scenario of projected to
spending in 2024
Market Size: reach US$ 2,000
is 6.7%
billion by 2033

4. World Bank’s
3. India ranks 5th 5. India’s direct
Ease of Doing
globally in the selling industry
Business 2023 in
retail destination by FY25 will be
that the Rank of
space US$ 7.77 billion
India: 63
Source: News articles, Trading Economics
 Evolution of retail in India

1) Substantial investment commitment from large Indian

corporates
2) Entry in food and general merchandise category
3) Pan-India expansion to top 100 cities
▪ Manufacturers opened their own outlets 4) Repositioning by existing players

Pre 1990s 1990-2005 2005-2010 2010 onwards

1) Pure-play retailers realised the potential of this 1) Cumulative FDI inflows stood at US$ 4.63 billion in the
market. retail trading sector between April 2000-March 2024.
2) Majority in the apparel segment 2) Retail 2020: Retrospect, Reinvent, Rewrite
3) Movement to smaller cities and rural areas
4) Large-scale entry of international brands
5) Approval of FDI limit in multi-brand retail up to 51%
6) Sourcing and investment rules for supermarkets
relaxed
7) 100% FDI in single-brand retail under the automatic
route
8) Retail sales in India grew 4% in February 2024,
 Competitive landscape in Indian retail
sector :-
1) Departmental stores:-
▪ Pantaloons has 344 stores in 170 towns/cities.
▪ Westside operates over 200 stores across 82 cities.
▪ Shoppers Stop has 117 stores & Lifestyle operates across 107 stores in India.
▪ Reliance Retails operates 18,836 stores across 7,000+ towns in India.

2. Hypermarkets
 Big Bazar, Spencer Easy day and Reliance are some major players present in the
market.
▪ Aditya Birla Retail – 3,977 brand stores.
▪ Trent has 16 stores under retail chain Star.
▪ Big Bazaar use to operate 1,500+ stores in more than 400 cities in India.
▪ Spencer’s Retail has 160 stores across 40 cities in the country.
 Competitive landscape in Indian retail
sector
3. Supermarkets/ convenience stores:-
▪ Aditya Birla Retail- More Supermarket (872 stores)
▪ Reliance Fresh (2,700 stores)
▪ Hyper CITY (17 stores)
▪ D-Mart (367 stores)
▪ 24*7 (145 stores)

4. Specialty stores
▪ Titan Industries is a large player, with 1,000+ Titan stores, 435 Tanishq
and 860+ Titan Eye+ shops.
▪ Vijay Sales, Croma and E-Zone in consumer electronics.
▪ Landmark and Crossword in books and gifts segment.
Strong growth in the Indian retail
industry
• The annual inflation rate based on all India Consumer Price
Index (CPI) number is 4.83% (Provisional) for the month of
April, 2024 (over April, 2023). Corresponding inflation rate
for rural and urban is 5.43% and 4.11%, respectively.
• According to Retailers Association of India (RAI) and Boston
Consulting Group (BCG), Indian retail market is expected to
reach US$ 2 trillion by 2032.
• As per Kearney Research, India’s retail industry is projected
to rise at a CAGR of 9% between 2019 and 2030, from US$
779 billion in 2019 to US$ 1,407 billion by 2026 and more
than US$ 1.8 trillion by 2030.
• India is an increasingly attractive market for multinationals,
driven by its expansive consumer base, abundant resources,
cost-effective labor, and favorable investment incentives,
such as tax breaks.
• India is the fifth largest and preferred retail destination
globally. The country is among the highest in the world in
terms of per capita retail store availability.
• India's retail sector is rapidly expanding beyond major cities
into smaller towns, fueled by robust economic growth,
shifting demographics, rising disposable incomes,
urbanization, and evolving consumer preferences.
Strong growth in the Indian retail
industry

• Source: indiaretailing.com, BMI Research, Consumer Leads

report by FICCI and Deloitte - October 2018, News Articles,
Trading Economics
 Organized retail in nascent stage
• The Indian retail sector is
predominantly fragmented,
with over 90% of transactions
occurring through
unorganized retailers such as
family-run and corner stores,
while organized retail is still
in its infancy.
• In 2022, traditional retail,
organized retail and E-
commerce segments
Source: BCG , KPMG- indiaretailing.com, Deloitte Report,
accounted for 81%, 12% and Winning in India’s Retail Sector, Centre for Digital
8% of the market, Financial Inclusion (CDFI) report, Crisil Report
respectively.
• The Indian e-commerce
industry is expected to cross
 • The organized retail market in India has 12% share
of the total retail market and has a growth rate of
10% over 2021-32.
• Increasing demand for organized retail space has
helped create a capacity of ~120 million square feet
(MSF) in retail space across major Indian cities. Major
Indian cities include Delhi (23.7 MSF) and Mumbai
(16.7 MSF).

Organised • The unorganized retail sector in India has a huge

untapped potential for adopting digital mode of
retail in payments as 63% of the retailers are interested in
using digital payments like mobile and card

nascent payments
• A competitive landscape has emerged among fintech
stage companies targeting local stores. In May 2020,
Paytm unveiled a US$ 1 billion loyalty program
alongside online ledger services for Kirana shops.
Other players like PayNearby, PhonePe, BharatPe,
and Mswipe have also introduced innovative
solutions to enhance digital payments and delivery
for small retailers.
• For example, Amazon partnered with local stores to
provide a platform for many small shops and
merchants on its Amazon marketplace. While,
Walmart has its own network of 28 ‘best-priced’
 Sector’s high growth potential is attracting
investors

India’s high growth potential

compared to global peers has
In November 2022, Swiss smart
made it a highly favourable
wearable device maker Garmin Canadian restaurant chain Tim
destination. According to a
expects India to be among its Hortons plans to open around
study by Boston Consulting
top three markets in Asia in the 120 stores in India by 2025 at
Group, India is expected to
next five years, fueled by an investment of up to Rs. 300
become the world's third
postCovid health activity trends crore (US$ 36.14 million).
largest consumer economy by
in the country.
reaching US$ 400 billion in
consumption by 2025.

Swedish retailer H&M is set to

launch its home decor and
IKEA, the Swedish furniture
accessories products such as
Keystone Realtors inks pact to maker has drawn up plans to
dinnerware and bed linen in
jointly develop 1.5-acre plot in invest Rs. 850 crore (US$
India next month. H&M HOME
Mumbai 102.41 million) in its Indian
will be available on the
operation.
company’s website and through
Myntra in 2024.
Sector’s high growth
potential is attracting
investors

• Lulu Group, a UAE-based

retail company, will invest
Rs. 2,000 crore (US$
240.96 million) to develop
a shopping mall near
Ahmedabad in Gujarat as
part of its plans to expand
business in India.

Source: AT Kearney 2023 FDI Confidence Index, Prime

Database
 Rising prominence of
online retail:-
• Recent industry reports reveal a remarkable 36.8%
YoY growth in e-commerce order volumes,
underscoring a significant consumer shift toward
year-round online shopping and reflecting the
sector's maturation in India.
• The E-Commerce market is expected to touch US$
350 billion in GMV by 2030.
• With consumers rapidly adopting online shopping
and renewed thrust from leading consumer goods
and retail players in the country, gross merchandise
value (GMV) of India’s e-tailers touched US$ 60
billion in FY2023.
• India’s digital economy is expected to touch US$
800 billion by 2030.
• Online retailers deliver to 15,000-20,000 pin codes
out of nearly 100,000 pin codes in the country.
• During the festival period in 2020, Amazon, Flipkart
and various vertical players sold goods worth US$ 9
billion despite the pandemic onslaught.
• Online shoppers in India are expected to reach
~500 million in 2030 from +150 million in 2020.
 Rising prominence of online retail:-
• As of December 2022, there were 7.8 billion daily e-commerce transactions.
Online shoppers in India are expected to reach ~500 million in 2030 from
+150 million in 2020.

Source: News
Articles
 Growth drivers for retail
in India
1. Consumer preference:-
• India’s per capita GDP increased to Rs. 2.12 lakh (US$
2,548) from Rs. 196,983 (US$ 2,397.54) in FY23.
• Indian consumers are now shifting more towards premium
brands.
2. Increase in digital payment methods in retail:-
• As per RBI digital payments in India grow from 162 crore
transactions in FY2012-13 to over 14,726 crore
transactions in 2023-24 (till February 2024).
• India recorded about 131 billion Unified Payments
Interface (UPI) transactions with a total value of Rs. 200
trillion (US$ 2,403.56 billion) in FY24.
3. Consumer finance opportunity:-
• According to India Ratings and Research, domestic
organized food and grocery retailers increased by 10% YoY
in FY22, with organized retailers and e-commerce
benefitting from the ongoing demand for essentials.
 Growth drivers for retail
in India
4. FDI approval:-
• At present, FDI in single-brand retailing is permitted up to
100%, whereas in multi-brand retailing, it is allowed up-till
51% only.
5. Hybrid retail model:-
• Retail 4.0 in India puts the focus on personalization with an
offline + online approach.
• Retail 4.0 holds the promise of an agile, efficient, inclusive,
and inter-dependent retail ecosystem with disruptive
growth and benefits for the sector and nation at large.
6. Investment:-
• In July 2021, the Andhra Pradesh government announced
retail parks policy 2021-26, anticipating targeted retail
investment of Rs. 5,000 crore (US$ 674.89 million) in the
next five years.
• In July 2021, Goat Brand Labs, a platform for D2C brands,
raised US$ 36 million and Lens kart raised US$ 315 million
from foreign investors.
• E-commerce and consumer internet companies raised US$
 Income growth to drive demand for
organized retail
• Over the years, retailing in India has been one of the most dynamic and fast paced industries, which
has travelled through different phases.
• Easy availability of credit and use of ‘plastic money’ have contributed to a strong and growing
consumer culture in India.
• According to the Retailers Association of India (RAI), the retail industry has experienced moderate
growth in 2023 as consumers are getting into regular business routines, which accounts for the high
base in April and May 2023.
• Acceptance and usage of E-retailers by consumers are increasing due to convenience and secured
financial transactions.
• Expansion in the size of the upper middle class and advertisement has led to greater spending on
luxury products and high brand consciousness.
• India’s Nominal gross domestic product (GDP) at current prices is estimated to be Rs. 296.58 lakh
crore (US$ 3.5 trillion) in FY24, as per the provisional estimates for 2023-24 and the per capita
income at current prices was estimated at Rs. 212,600 (US$ 2,554.86) in FY24.
• The e-commerce market itself is estimated to grow to US$ 98 billion in FY24
 Income growth to drive
demand for organised
retail

Source: IMF, MoSPI

• Given the strong retail and consumer
outlook, India is expected to witness
redefining trends which will shape the
future of the retail market.
 Growth Value Proposition
Demand factors Rising incomes and purchasing
Higher brand consciousness
power

Growing aspiration levels and

Credit availability
appetite to experiment

Growing young population and Changing consumer preferences

working women and growing urbanization

Indian Retail Opportunity

Rapid real estate and Easy availability of credit

Supply factors

infrastructure development

Expansion plans of existing

Emergence of new categories players

Development of supply chain R&D, innovation and new product

improving efficiency development
 1. LARGE NUMBER OF RETAIL OUTLETS
• India is the fifth-largest preferred retail
destination globally.
• Reliance Retail leads India's retail sector with
a vast network of 10,415 stores spanning 22
million square feet, excelling in food,
consumer electronics, and fashion. It ranks as
Ample growth the top retail company in the country.
opportunities in 2) PRIVATE LABEL OPPORTUNITIES
• According to a KPMG report, online private
Indian retail labels are estimated to grow 1.3 to 1.6 times
faster than the traditional ecommerce
industry platforms.
• The share of private label strategy in the US
and UK markets is 19% and 39%,
respectively, while its share in India is just
6%. Stores like Shopper Stop and Lifestyle
generates 15 to 25% of their revenue from
private label brands.
 3) SOURCING BASE
• India‘s price competitiveness attracts large retail
players to use it as a sourcing base.
• Global retailers such as Walmart, GAP, Tesco and
JC Penney are increasing their sourcing from India
and are moving from third-party buying offices to
Ample growth establishing their own wholly-owned/wholly-
managed sourcing and buying offices.
opportunities in 4) LUXURY RETAILING
• Young Indians have become aspirational
Indian retail consumers of luxury products owing to higher
disposable income, increased awareness about
industry:- luxury brands and stable economic growth in the
country.
• Indian luxury market is expected to grow to US$
200 billion by 2030, supported by growing
exposure of international brands among Indian
youth and higher purchasing power of the upper
class in tier II and III cities, according to
ASSOCHAM.
Franchise
 • Franchising is a form of marketing
and distribution in which the
What is franchisor, the brand owner, grants
the franchisee the rights to run their
franchising? own local business, using the
franchisor's product, service, system,
and proven umbrella of success.
History of franchising
Franchising originated in the 1850s when Isaac Singer, inventor of
Singer's sewing machine, couldn't expand his business because no
one knew how to use it, and he did not have enough money to
mass-produce no sewing machines.

He came up with the idea of franchising, where he sold the rights to

manufacture his machines and taught each franchisee how to use
them. His business took off, and Singer is now one of the world's
most renowned brands.

Mcdonald's is also a perfect example of a successful franchise that

copied Singer's business model. They currently have 14,000
restaurants all over the world.
 Growth Projections for
Franchising in India

• The sector is expected to reach USD 140-150

billion within the next five years.
• Currently valued at approximately Rs 800 billion,
the industry is projected to maintain a robust
annual growth rate of 30 to 35 percent.
• Franchising is anticipated to contribute around
4% to India’s GDP by 2024, up from its current
contribution of 1.8%.
 Some Franchise segments in
India:

• Domino's Pizza:-
India has the most Domino's franchises in the world, with over 1,000
outlets. Jubilant Food Works is the master franchise that operates Domino's
Pizza in India.
• Lenskart
This leading eyewear brand has a pan-India presence and is expanding
through both online and offline stores.
• Subway
This franchise is considered one of the simplest in India, and offers a wide
selection of breads, sandwiches, salads, and subs.
Franchise Market Size 2024-
2028
 Types of Franchise:-
1. CoCo :-
o The CoCo (Company-Owned, Company-Operated) Franchise Business Model represents a situation in
which the parent company directly owns and operates the business units.
2. FoCo:-
o The FoCo franchise business model also known as the "Franchise Owned Company Operated" business
model, is a form of franchise business model in which the franchisee owns the company but the franchisor
manages it.
3. FoFo:-
o The FoFo(Franchise Owned Franchise Operated) Franchise business model is a form of franchise model in
which the franchise business while the franchisor gives the brand name, trademarkes, and business model
to the franchisee.
Where does this business model is
been used?

1) Where does the CoCo model is been used?

o Franchisors use the COCO model as a testing ground for their business concept and
to iron out best practices. If the business proves viable, they can begin searching for
franchising opportunities.
2) Where does the FoFo Model is been used?
o While franchisees retain significant control over business operations (like staffing,
inventory management, and local marketing efforts, they also must follow the
franchisor’s guidelines and brand standards to ensure consistency.
3) Where does the FoCo Model is been used?
o This approach is often adopted by franchisors who want to maintain complete control
over their brand image, operational consistency, and customer experience.
Types of Job
Product
(Distributio
franchise:- Franchise
n) franchise

Business
Investment
Format
Franchise
Franchise

Conversion
Franchise
 Types of Franchise
2) Product(Distribution) 3) Business Format
1) Job Franchise:- Franchise:- Franchise:-
• A job franchise is a • With a distribution • The business format
franchise model which is franchise, the franchisor franchise is the model
designed to be owned grants the franchisee the that will spring to most
and run by one person - right to distribute or sell people’s minds when
an owner-operator - or their product or range of they think of franchising.
with minimal additional products to customers. A Under a business format
staff. It is generally a low- distribution franchise franchise, the franchisor
investment opportunity differs from other types provides the franchisee
and very often is a of franchise because with everything needed
franchise which can be generally the franchisee in order to set up and
operated from the will operate and sell the operate the business,
franchisee's home or on franchisor's product from equipment and
a mobile basis. under their own identity premises if required, to
rather than adopting the training, operational
franchisor's name and systems, supplier
operational systems. contracts, marketing
 Types of Franchise

4) Investment Franchise:- 5) Conversion Franchise:-

• An investment franchise is • The conversion franchise
at the other end of the scale model allows an
to the job franchise. It is a independent business
large scale operation, owner to join a franchisor's
requiring significant capital network by converting their
expenditure. In most cases existing business into a
the franchisee will not be franchise branch. This
involved in the business on approach enables quick
a day-to-day basis at all, expansion for the franchisor
and in all cases the and provides the franchise
franchise will require a with the benefits of brand
significant professional recognition, training &
 How franchise works in India?

Direct Master Regional Local Incorporation

Franchising :- Franchising :- Franchising :- :-
• Direct Franchising is • Master Franching is • Regional • Local
where a company where a company franchising operates incorporation is
creates a direct awards exclusive in the same way as when a foreign
network of rights to develop a master franchising franchisor forms a
franchises. This foreign brand to a but covers only a subsidiary company
works well for local local entity, often specific regional and awards it
companies with pre- accompanied with a area as opposed to franchising rights in
existing experience large investment the entire country. India.
in India. made by the Given India’s
franchisor. The diversity along with
master franchisee is the complexity of
then in charge of state-specific laws,
developing the many franchisors
company’s brand choose a regional
either through franchising
cultivating a sub- approach.
franchised network
or opening outlets
 Law & Legal Documents:

The Indian
The Trademarks The Designs The Patents Act,
Contract Act,
Act, 1999 Act, 2000 1970
1982

The Foreign
The
The Copyright Exchange Income Tax Act,
Competition
Act, 1957 Management 1961
Act, 2002
Act, 1999

The Consumer The Arbitration

Protection Act, and Conciliation
1986 Act, 1996
Thank you…