Navigating the Retail Opportunity in India.
Sudhanshu Karandikar
India expert in Europe driving Strategy and Implementation, advising clients on M&A, Joint Ventures, Alliances, Smart-Sourcing and Agile Marketing. Thought Leader on India, he collaborates with the Indian and Spanish embassies, Casa Asia, CEOE and is a visiting faculty at ESADE, UAB, TBS among other universities.
The Retail Opportunity in India 5 graphic insights
The biggest democracy & the fastest growing big economy – estimated to be 5 trillion USD in 2027, India also boasts having the youngest demography among OECD countries.
Explore the Retail Opportunity with us.
1. The Indian retail market expected to reach $1.1 Tn (2027) and $2 Tn by 2032
1.4+ Billion population, increasing urbanization, booming middle-class with growing disposable income & discretionary spending, connected rural consumers and the digital payments revolution is accelerating the retail spending growth – evident from the optimistic sentiment on personal income outlook is positive.
2. Consumption is growing across customer segments
3. The size, topology and logistics
3200+ km North – South and c 3000 km East – West extension, India/Bharat is a subcontinent with different climates and terrains. 7 topological zones including deserts, mountain ranges, coastlines and plains make the logistics planning fundamental to the sales and distribution strategy.
The distribution network is similar to most countries – a three-tier selling and distribution structure involving distributors, wholesalers, and retailers. The additional layer of importer might be required in case you do not plan to produce or package in India.
Approximately 12 million retail distribution outlets in the country – majority of which are unorganized family-owned entities, the sector is expected to increase at a rate of 10 to 12 percent annually over the next 10 years, requiring a strong distribution network to cater to India’s rapidly expanding consumer demand.
4. One-market?
22+ languages and cultural identities, 8 metros, 97 Tier II cities with growing Tier III and Tier IV cities acting as economic centers and a booming rural market means it is important to align your product benefits, pricing, distribution and strategy with different socioeconomic profiles, geography and demographics.
Some clusters defined by proximity to “economic centers” viz. cities, are easy to spot but others could be more granular and need experienced inputs and insights.
Consumer preferences, behavior, socioeconomic profiles vary across the geography, proximity to “economic centers” viz. cities, age, culture (20+cultures and languages), education and regional preferences across the geographic and rural-urban continuum.
5. Key factors for success: Navigating Ratail in India
A diverse and price-sensitive market spread across a sub-continent makes it imperative to
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Focus on knowing your customer – not just the consumer behavior but also “where” – the geographic location and clusters
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The Sales and Distribution strategy is a key – not just to reach but also to ensure uptake and positioning
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Getting the Price-point right – the customers are spoilt for choice and has a perceived price-point for the category in a high-volume market
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Technology is transforming the sector with not just with Big Data, Analytics, smart logistics but also e-tailing, D2C, QSR, etc.
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Get your feet on the ground, make sure you have the local know-how – through advisors, partners or other means
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You might like to manufacture or contract-manufacture your product in India to attain cost efficiencies and potential tax incentives
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