RETAILING IN INDIA

FOREIGN DIRECT INVESTMENT

Sameer Mathur, Ph.D.

Sameer Mathur
smathur.com

Asst. Professor (Marketing) 2009 2013

Ph.D. and M.S. (Marketing) 2003 2009

Agenda
Overview of FDI in Indian Retailing Organized Retailing in India Current Status

Regulations on FDI in Indian Retailing

Opposition to FDI in India

FDI Retailing: Niche & Increasing

The Indian market is becoming more accessible to global firms. Many well known multinationals are interested in expanding their operations into the Indian market, (e.g. Wal-Mart, Metro & Carrefour).

FDI Retailing: Niche & Increasing

FDI Retailing in India

Indian government wants to fully open up its markets to foreign direct investment Many opposition parties are hindering the growth of this open market initiative. A growing debate exists on whether or not international retailers should be allowed to engage in multi-branding retailing At present, global firms are only allowed to engage in Cash & Carry (wholesaling) operations in India.

Cash & Carry

Agenda
Overview of FDI in Indian Retailing Organized Retailing in India Current Status

Regulations on FDI in Indian Retailing

Opposition to FDI in India

Organized Retailing Brand Shares % 2009

Titan Industries Ltd 15%

Pantaloon Retail India Ltd 23%

Spencer's Retail Ltd 8% Vishal Retail Ltd 8% Infiniti Retail Ltd 8% Aditya Birla Retail Ltd 8%
Source: Euromonitor - Retailing in India 2011

Reliance Retail Ltd 15%

Amway India Enterprises PVT Ltd 7% LG Electronics India PVT Ltd 8%

Organized Retailing Brand Shares % 2010 Spencer's Retail

Ltd Vishal Retail Ltd 7% 7%

Infiniti Retail Ltd 7%

Aditya Birla Retail Ltd 7%

Future Value Retail Ltd 26%

LG Electronics India PVT Ltd 7% Amway India Enterprises PVT Ltd 6%

Source: Euromonitor - Retailing in India 2011

Titan Industries Ltd 20% Reliance Retail Ltd 13%

Top Organized Retailing Brand Shares

Organized Store-Based Retailing Brand Shares % Retail 2009 Spencer's

Vishal Retail Ltd Ltd 6% 6%
Infiniti Retail Ltd 6% Next Retail India Ltd 5% Aditya Birla Retail Ltd 5% Shopper's Stop 5% Titan Industries Ltd 17%

Reliance Retail Ltd 11%

LG Electronics India PVT Ltd 11%

Pantaloon Retail India Ltd 28%

Source: Euromonitor - Retailing in India 2011

Organized Store-Based Retailing Brand Shares % 2010 Spencer's

Vishal Retail Ltd Retail Ltd 5% 5% Infiniti Retail Ltd 5% Next Retail India Ltd 5% Aditya Birla Retail Ltd 5% Shopper's Stop 5% Future Value Retail Ltd 19%

Titan Industries Ltd 19%

LG Electronics India PVT Ltd 9% Pantaloon Retail India Ltd 9%

Source: Euromonitor - Retailing in India 2011

Reliance Retail Ltd 14%

Improved Targeting
Foreign retailers are thinking of new ways and approaches in order to successfully reach the endconsumer by developing and employing various different marketing techniques, such as the provision of additional services, fashion consulting, home delivery, special discount periods, but not limited to rebranding of retail chains.

Improved Targeting

Source: Euromonitor - Retailing in India 2011

Organized Non-Grocery Retailing Brand Shares % 2009

4% 4% 4% 2% 15% Titan Industries Ltd LG Electronics India Pvt. Ltd Infiniti Retail Ltd Godrej & Boyce Manufacturing Co Ltd Next India Retail Ltd 4% 9% 4% Vishal Retail Ltd Shopper's Stop Ltd Reebok India Pvt Ltd Pantaloon Retail India Ltd

Lifestyle International Pvt Ltd

4% 4% Vijay Sales Ltd Apollo Hospitals Enterprises Ltd 4% 6% 4% 2% 4% 4% 4% 4% 6% 4% Tribhovandas Bhimji Zaveri Delhi Pvt Ltd adidas India Marketing Pvt Ltd Samsung India Electronics Ltd Bata India Ltd Raymond Ltd Bombay Dyeing & Manufacturing Co Ltd Pantaloon Retail India Ltd Reliance Retail Ltd

Top Organized Non-Grocery Retailing Brand Shares

Infiniti Retail Ltd.

Organized Non-Grocery Retailing Brand Shares % 2010

4% 4% 4% 4% 2% Titan Industries Ltd 15% LG Electronics India Pvt. Ltd Infiniti Retail Ltd Godrej & Boyce Manufacturing Co Ltd Next India Retail Ltd Vishal Retail Ltd 4% 8% Shopper's Stop Ltd Reebok India Pvt Ltd 4% 6% 4% Pantaloon Retail India Ltd

Lifestyle International Pvt Ltd

Vijay Sales Ltd Apollo Hospitals Enterprises Ltd Tribhovandas Bhimji Zaveri Delhi Pvt Ltd 4% 6% 4% 4% 4% 6% 6% 6% 6% adidas India Marketing Pvt Ltd Samsung India Electronics Ltd Bata India Ltd Raymond Ltd Bombay Dyeing & Manufacturing Co Ltd Pantaloon Retail India Ltd Reliance Retail Ltd

Agenda
Overview of FDI in Indian Retailing Organized Retailing in India Current Status

Regulations on FDI in Indian Retailing

Opposition to FDI in India

Regulations

Regulations
The government only permits 51% FDI in single-brand retailing.

At present, FDI in Multi-branding retailing is illegal, i.e. prohibited.

However, the latter has a promising future, since, if permitted, it would enormously help Indias economy.

Franchising: Cash & Carry Permitted

Agenda
Overview of FDI in Indian Retailing Organized Retailing in India Current Status

Regulations on FDI in Indian Retailing

Opposition to FDI in India

Opposition: Professionals

Opposition: Common Folk

Opposition: Intellectuals

Opposition: Concerned Citizens

Fierce Opposition Exists

The concern is that FDI in Retail will destroy the traditional way of retailing in India, sending mom & pop shops out of business. Some are just protecting their own personal or business retailing interests.

SUMMARY
Overview of FDI in Indian Retailing Organized Retailing in India Current Status

Regulations on FDI in Indian Retailing

Opposition to FDI in India

References and Image Credits

Retailing in India. (2011, March). Euromonitor International. Retrieved from Passport.
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References and Image Credits

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