Retail in India

Source:http://retail-tech.blogspot.com/2008/09/organized-retail-in-india-to-form-14-18.html

Unorganised Retail & Organized Retail
The advent of organized retail has impacted the unorganized retail. But the unorganized retail is showing remarkable resilience and is all set to challenge the organized retail with innovative business models, hybrid formats, in-store operations focus etc.
The organized retail is where most of the focus has been and a lot of metrics have been floated that talk of very high growth rates. Information on unorganized retail is sketchy thus the possible ways of their resilience & responsiveness are not known.
But a closer study of metrics tells that focusing on revenue per square foot & area under retail, as levers of growth and value might not be the whole story and may not be entirely accurate.
And for the unorganized retail the relevance of these metrics might be very different (or in a different manner) than what it would be for organized retail.
If we look at organized and unorganized retail as the two extremes of formats, operations, consolidation etc. there is an opportunity to explore multiple, innovative forms of retail that can exist / co-exist profitably within these 2 extremes.

A scan of recent activities in the retail market shows some initial indicators for the same (even if it is at one end of the extreme...):

• Retailers, realty cos’ form partnerships to beat slowdown - Revenue sharing rental based model with minimum upfront payment emerging – without minimum upfront guarantee.
  

• Vishal Retail is in early stage discussions with some top developers to enter into a revenue sharing-based rental model,Megamart has signed a few large stores on revenue sharing-based rental model ,Brandhouse Retails.

• Big retailers not keen to anchor new malls (future group plans to open stores along with other retailers so that it doesn't have to go through a long gestation period to reach optimum sales).