Rural Formats of Modern Retail
Rural Formats of Modern Retail
Rural Formats of Modern Retail
India.
Rural Retail: Retail is undergoing major changes in todays
changing business environment. Industrial sectors are in the phase
of transition from conventional business models to innovative,
market driven and consumer centric models. In India retail is not a
new word, however the emerging formats of retailing are changing
the entire scenario and posing tough challenges in front of Indian
retailers.
They are now designing customized retail products and services and
targeting the untapped segment of the market. Presently, nearly
60% of the population resides in rural India and their retail
requirements are partially met by the unorganized retail stores. This
study is an attempt to explore the potential of rural retail market of
India, accessing their needs for products and brands. The study also
aims at developing a business model for the rural retail market in
India.
More than 70% of the Indian population lives in more than 600000
villages of varied sizes, infrastructure, education levels and
economic conditions. According to India Retail report 2009, the
urban rural split in consumer spending stands at 9:11, with rural
India accounting for 55 percent of private retail consumption. With
organized retailing getting into maturity in Tier-I and Tier-II cities,
the next level of retail growth would be seen in rural markets.
There are a number of formats in modern retail that emerged over
the last century or so and have now become the standard the world
over. They today rule the roost and have captured the bulk of the
market share around the globe. Let us discuss these briefly.
The Indian retail sector is going through a transformation and this
emerging market is witnessing a significant change in its growth and
investment pattern. Both existing and new players are
experimenting with new retail formats. Currently two popular
formats hypermarkets and supermarkets are growing at a rapid
pace. Apart from the brick mortar formats; brick -click and clickclick formats are also increasingly functional on the Indian retail
landscape. Consumer dynamics in India is also changing and the
retailers need to take note of this and formulate their strategies and
tactics to deliver the exact expected value to the customer.
Development of mega malls in India is adding new dimensions to
the booming retail sector. There is significant development in retail
landscape not only in the metros but also in the smaller cities and
towns.
are expanding their services to Tier 2 and Tier 3 cities. With growing
internet penetration, Rural India has greater capacity and demands.
Few formats which can be incorporated in Rural India:
Supermarkets:
A supermarket is a large food store of at least 4,000 sq.ft. in size
where the bulk of the sale is under the self-service system. In Rural
India, majorly all the villages buy bulk products in a near buy town.
Super Markets will be a more useful means of providing service to
the customers at one go.
Convenience Stores:
A convenience store is a scaled-down version of a supermarket.
Convenience stores can be set up in villages where the population
lies in the middle and higher income levels. This not only increases
penetration but also taps the untapped market very easily. And
hence brand recognition all over.
Discount Stores: Most of the population in India prefers products
at low cost, discount stores provide an opportunity to enter to the
Rural India.