Page 39 - DMGT552_VISUAL_MERCHANDISING

Visual Merchandising

Notes 7. Saudi Arabia
8. Peru
9. U.A.E.
10. Turkey

Over the past ten years, the GRDI study has shown that global retail expansion is a portfolio
game. Retailers must have an optimal mix of countries, formats and operating models to
succeed.
Source: www.forums.industryweek.com/A T Kearney
India’s retailing industry is essentially owner manned small shops. In 2010, larger format
convenience stores and supermarkets accounted for about 4 percent of the industry, and these
were present only in large urban centres. India’s retail and logistics industry employs about 40
million Indians (3.3% of Indian population).
Until 2011, Indian central government denied Foreign Direct Investment (FDI) in multi-brand
retail, forbidding foreign groups from any ownership in supermarkets, convenience stores or
any retail outlets. Even single-brand retail was limited to 51% ownership and a bureaucratic
process.

In November 2011, India’s central government announced retail reforms for both multi-brand
stores and single-brand stores. These market reforms paved the way for retail innovation and
competition with multi-brand retailers such as Walmart, Carrefour and Tesco, as well single
brand majors such as IKEA, Nike, and Apple. The announcement sparked intense activism, both
in opposition and in support of the reforms. In December 2011, under pressure from the opposition,
Indian government placed the retail reforms on hold till it reaches a consensus.
In January 2012, India approved reforms for single-brand stores welcoming anyone in the world
to innovate in Indian retail market with 100% ownership, but imposed the requirement that the
single brand retailer source 30 percent of its goods from India. Indian government continues the
hold on retail reforms for multi-brand stores.
In June 2012, IKEA announced it has applied for permission to invest $1.9 billion in India and set
up 25 retail stores. Fitch believes that the 30 percent requirement is likely to significantly delay
if not prevent most single brand majors from Europe, USA and Japan from opening stores and
creating associated jobs in India.

Task Visit your nearby retailers and find out what all activities do they perform to
enrich customer service.

On 14 September 2012, the government of India announced the opening of FDI in multi brand
retail, subject to approvals by individual states. This decision has been welcomed by economists
and the markets, however has caused protests and an upheaval in India’s central government’s
political coalition structure. On 20 September 2012, the Government of India formally notified
the FDI reforms for single and multi brand retail, thereby making it effective under Indian law.

2.4.1 Role of Retail in Nations Economy

Retail sales are an important economic indicator because consumer spending drives much of
our economy. Think of all of the people and companies involved in producing, distributing, and
selling the goods you use on a daily basis like food, clothes, fuel, and so on.

34 LOVELY PROFESSIONAL UNIVERSITY