Growth of Retail Sector in India

 Introduction

The retail industry is the fastest growing industry in India. Most Indian shopping happens in the open market at small yet large numbers of the grocery store and small shops. Most of the retail sector is unorganized for a long time. People simply go to the shops to ask for what they want without examining it and make a purchase. The relationship between a retailer and a customer is very informal. If they find any defect in the product they can also return it. People have open these stores to earn their livelihood and there is no proper system to manage books and keeping the score of the goods and services. The whole family manages these unorganized stores. There is no retail technology is used in these stores and they don't benefit the nation as opposed to the organized sector.

 The organized retail sector is made of all incorporated retail companies which are involved in the sale and production of goods and services as a registered private limited or limited organization by the government. They must have at least 10 employees on the direct payroll of the company. Their wages should be governed by the minimum wages act. In simple terms, organized retailing in India can be operated only by licensed retailers, they are eligible to pay sales tax and income tax and can take advantage of retail schemes offered by the government. Marg compusoft provides the tools to run smooth operations of retail stores such as the POS system.

Retailing in India is bit by bit creeping its way toward turning into the following blast industry. The entire idea of shopping has adjusted as far as configuration and customer purchasing conduct, introducing unrest in shopping in India. Current retail has entered India as found in rambling malls, multi-celebrated shopping centers, and tremendous edifices that offer shopping, amusement, and food all under one rooftop.

The Indian retailing area is at an articulation point where the development of sorted out retailing and development in the utilization by the Indian population will take a higher development direction. The Indian population is seeing a critical change in its social economics. A huge youthful working population with middle age of 24 years, family units in metropolitan territories, alongside expanding workingwomen populace and developing open doors in the administration area will be the key development drivers of the sorted out the retail segment in India.

Indian Retail Market

The retail market is the backbone of the Indian economy. The retail sector is single-handedly responsible for at least 10 percent of GDP. The Indian retail industry is the fifth largest retail industry in the world. India ranks 63 in the world banks doing business in 2020. the economic value of Indian retail markets is estimated to be US$ 600 billion. The retail sector in India is one of the fastest-growing markets with 1.2 billion people. India's retail sector is expecting major growth with retail development taking place over the last years, not just in metro cities but also in semi-urban and rural areas.

The Indian retail industry ranks highest among the world in terms of per capita retail store availability. The E-commerce market is growing exponentially and is very well received by Indian customers. It is helping to break the geographical barriers and retailers are reaching a large population with the help of online shopping. Indian online grocery market is expected to increase sales by  US$ 3.19 billion in 2020. the e-commerce market is going to witness the boom of above 70 percent in comparison to previous years.

Online retail was already popular among youths but because of this pandemic situation, people are leaning more towards the e-commerce market. Indian population is accepting online shopping all over the country as it has several benefits. They are getting many choices in one product, online shopping is breaking all physical boundaries. All the retail market is available on the customer's fingertips. The online retail sector is giving boom to the logistics industry as well. Customers have small and large retail store options on their mobile phones and they don't have to worry about the delivery of the goods and services as they re getting everything on their doorsteps.

Marg Compusoft is helping small and large retail store owners to grow their business with modern retail and distribution software. For the online retail sector, they have introduced easy mobile apps such as eretail for retail customers, eorders for field salesman, and eOwner for retail store owners with GPS tracking facility for transparency between customers.

History of Indian Retail Industry

In 1997, India allowed foreign direct investment (FDI) in cash and carry wholesale which is further approved by the government in 2006. the approval was easy and automatic permission was granted. Indian retail market attracted $1.8 billion in FDI out of which a very small percentage of 1.5 flow into India.  The growth of the retail sector was very limited from 2000 -2010. Single brand retail trade attracted only 94 proposals out of which only 57 were approved. For a country with such a large population, the growth of the retail sector was very significant.

In retail market experience very limited growth. India has only 5386 cold storage's which leads to the highest number of spoilage of food harvest in the world. The retail sector loses 30% in certain perishable agricultural output every year. Indian retail market was not getting any interest in foreign direct investment in cold storage infrastructure. Because of the lack of an organized retail sector, where there was no healthy competition, lack of innovative ideas and technology, Indian retail suffers a lot. After years of debate, the government finally lifted the ban on FDI on Multi-brand retailing. Until 2010, the Indian retail industry was dominated by middle man and intermediaries.

Due to a large number of intermediaries involved in the retail sector, there was no transparency between retailers and customers. At that time most of the retail sector was based on agriculture but still, farmers were not getting a proper payout for their production, and consumers were paying too much than the actual cost. With the introduction of the organized retail sector, the middle man loses their power and new rules were made which leads to the total transparency among manufacturers, wholesalers, retailers, and consumers.

The beginning of 2011, brings new hope and opportunities for the retail industry.  The government initiated several schemes to promote the retail market. They introduced multiplier grant schemes for the IT sector, launched several credit fund schemes to help micro and small businesses. Many Startup companies were launched with the help of government-funded schemes which finally improves the profit margins and employment for the young generation. The online retail business introduced in the Indian market which definitely faces its challenges because customer prefers to go to the market and select their goods after careful inspection.

Modern Retail Market

In the last decade, the Indian retail market has witnessed a revolution. India is now the fastest-growing retail industry in the world. The modern retail market provides a wide range of goods and services to its customers under one roof. The whole concept is about providing an ideal shopping experience with a huge variety of products and services under different price ranges. In 2020, the offline retail market is expected to reach $1.1 trillion and online retail or e-commerce has the potential to reach $120 billion. The organized retail market is estimating the compound growth rate of 40% annually.

Modern retail formats have been introduced and classified into three main categories; Malls and hyper/Supermarkets, and specialty stores. These formats have made the shopping experience pleasant for customers as they can get all their needs fulfilled under one roof with a wide range of products and services. Customers have total transparency about the products and brands. All the brand's products and services are available under one roof where customers can choose according to his/her preference and budget.

The retail sector is full of modern technology and at the same time, healthy competition exists. There is no monopoly on one brand or company. The expansion and development of the modern retailing industry are associated with the efficiency of the supply chain which leads to lower price distribution.  That is why all retailers must use modern retail software for smooth operations. Marg Compusoft provides various services and tools to the retail sector, distribution sector, and manufacturers. Marg Compusoft helps to minimize losses and improves quality retail operations. The retail sector can save a lot of time and energy on managing accounts and bookkeeping and can focus on new trends and fashion. It enhances the efficiency of manufacturing and retail functions and saves the cost of running operations.

As the growth of e-commerce is expanding, even small retailers are working with large online stores to reach a wide population of customers. The E-commerce industry is breaking all geographical boundaries and providing a wide range of goods and services under affordable prices to consumers. Retailers are using these techniques to keep their data safe in the cloud and expanding their customer base with the help of POS Systems in their own online store.

No one can deny that most of the developing countries rely on their retail industry for the growth of the country. The Indian retail industry is moving continuously towards becoming the next boom industry. The world has its eyes set on the retail industry of India with the entry of many key players in the market such as Walmart. According to experts its no surprise the way the Indian retail industry is growing, it will become the world's number one retail sector within a decade.