Inventory Management

Indian Organized Retail Industry

Author(s)

A WNS Perspective

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Key Points

The organized retail sector will grow by 35-40% over the next 3-5 years. What are the political, economic, social and technical drivers of this growth?
Economic buoyancy has resulted in higher per capita disposable income, which is reflected in a stronger Consumer Confidence Index
The sector faces an acute shortage of trained professionals, from customer associates to visual merchandisers
Retail chains are focusing on training their employees and adopting employee-focused schemes to reduce attrition rates

A perspective on staffing in the Retail Industry

The Indian retail sector was estimated to be worth USD 350 billion during 2007 and is expected to grow at a compounded annual growth rate (CAGR) of 6.8% to approximate USD 427 billion by 2010. To underscore, in 2007, almost 97% of the Indian retail market was dominated by traditional ‘kirana’ or ‘dad and son shops’. The country’s vast geographic, cultural, and economic diversity has inadvertently facilitated traditional retail over centuries because of a strong need and preference for customized and personalized shopping requirements. Unlike some of the more developed nations, the socio-economic profile of consumers in India changes every 50–100 km leading to highly differentiated buying patterns, demand for products, price sensitivity, and responsiveness to promotion tools. As a result, changing the merchandise mix to meet local demand, standardizing and organizing retail operations across the country has its own set of challenges

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