Description
The Indian retail industry is estimated to be $470 billion. The organized or modern retailing with 6% share stands at $26 billion. It is projected to reach US$ 1.3 trillion by 2018 with the organized retail market estimated to grow at the compounded annual growth rate of 40% and reach US$107 billion by the year 2013. Entry of these retailers in different formats, including online, has affected an irreversible change in consumer buying habits and businesses related to serving these retailers.
Development of Modern Retailing in India: It’s Impacts on
Distribution and Procurement Networks and
Changing Consumption Pattern
Piyush Kumar Sinha
Srikant Gokhale
Sujo Thomas
W.P. No. 2012-12-04
December 2012
The main objective of the working paper series of the IIMA is to help faculty members,
research staff and doctoral students to speedily share their research findings with professional
colleagues and test their research findings at the pre-publication stage. IIMA is committed to
maintain academic freedom. The opinion(s), view(s) and conclusion(s) expressed in the
working paper are those of the authors and not that of IIMA.
INDIAN INSTITUTE OF MANAGEMENT
AHMEDABAD-380 015
INDIA
IIMA INDIA
Research and Publications
Page No. 2 W.P. No. 2012-12-04
Development of Modern Retailing in India: It’s Impacts on Distribution and
Procurement Networks and Changing Consumption Pattern
Piyush Kumar Sinha
Professor, Indian Institute of Management Ahmedabad
Email: [email protected]
Srikant Gokhale
Adjunct Faculty, Indian Institute of Management Ahmedabad
Sujo Thomas
Academic Associate, Indian Institute of Management Ahmedabad
Email: [email protected]
Abstract
The Indian retail industry is estimated to be $470 billion. The organized or modern
retailing with 6% share stands at $26 billion. It is projected to reach US$ 1.3 trillion
by 2018 with the organized retail market estimated to grow at the compounded
annual growth rate of 40% and reach US$107 billion by the year 2013. Entry of these
retailers in different formats, including online, has affected an irreversible change in
consumer buying habits and businesses related to serving these retailers. However,
unlike many other countries, India has its own unique character of size, geographical
spread, cultural diversity, and multiplicity of formats being introduced at quick
succession. Retailers also face the challenge of developing infrastructure, on their
own or in cooperation with the government. This paper attempts to explore the
industry and evaluate the extent of its impact on distribution and procurement
networks and changing consumption pattern in India.
Key Words: India, Retailing, Distribution, Procurement, Consumption.
IIMA INDIA
Research and Publications
Page No. 3 W.P. No. 2012-12-04
Development of Modern Retailing in India: It’s Impacts on Distribution and
Procurement Networks and Changing Consumption Pattern
Introduction
India has witnessed a revolution in the last two decades owing to rapid urbanization and changing
consumption. This has led retailers to concentrate their energies and leverage their capacities to
harness the potential. The entry of the leading corporate houses into retail created a surge into the
growth of the industry. The Indian retail industry is estimated to be $470 billion. The organized or
modern retailing with 6% share stands at $26 billion.
i
The Indian retail sector is projected to reach
US$ 1.3 trillion by 2018and the organized retail market is estimated at compounded annual growth
rateof 40% which is anticipated at 107 billion US$ by the year 2013.
ii
As per the McKinsey Report,
'The rise of Indian Consumer Market', by the year 2025, the Indian consumer market is expected to
grow four fold
iii
. India with its current retail growth rate turns out to be one of the most prominent
countries for global retailers.
Since the liberalization of the Indian economy in the 1990s, there has been a continuous change in
the consumer buying behavior. The positive consumer sentiment has led to retailers expandingto
eventier 1 and 2 cities.The market dynamics in Indian retail industry are dissimilar when equated
with other countries and it is not easy to function in an Indian market. If we have a close look at the
unique demography of India, we would discover that it comprises of 25 states with different
culturaldistricts existing concurrently in a market. While urbanization seems to be mixing these
cultures, people tend to be living in coherent cultural group, mainly described by the state from
where they originate. Most stores have trading areas that are mixed in their demography,thereby
making the retailers work harder while meeting the varying demands of diverse consumers. The
areas consist ofheterogeneous group of consumers who have predominantly varying buying power.It
IIMA INDIA
Research and Publications
Page No. 4 W.P. No. 2012-12-04
is posited that for retailers in India, social class could be a better segmentation variable that other
demographic factors.
The main objective of this paper is to gain insight into the developments of modern retail from the
Indian perspective. This paper attempts to explore and evaluate the extent of its impact on
distribution and procurement networks and changing consumption pattern in India. The initial
section of this paper discusses the development of modern retailing in India alongside the nature of
the Indian retail industry. The next section of this paper enumerates the changing consumption
patterns due to the progress in modern retail and subsequently this paper examines the impact of
modern retail on the distribution and procurement. Moreover, FDI (Foreign Direct investment) in
retail,another major area of discussion having its bearing on the development of modern retail is
discussed.
Development of Modern Retail
As per the estimates of Indian Retail Report 2011, the modern retail in the next five years is
expected to would contribute to a minimum of one third of the marketof 40 trillion. This report
estimates that by the year 2016, the modern retail would have 19.3 percentage share of the total
retail market
iv
. For some leading consumer product companies, modern retailers contribute about
10% of their total sale nationally and about 20% in top 10 cities.
v
The preeminent outcome of the
development of modern retailing in India is an increase of choice among consumers. With the
advent of modern retailing in the emerging markets have witnessed developments in the areas of
TechnologyTransfer, enhanced quality levels of produce, products at competitive prices, better
procurement practices and enhanced employment opportunities.
vi
The development and growth of modern retailing is connected to the lower prices resulting from the
functional efficiencies in the supply chain (Minten and Reardon, 2008).Studies in the developing
IIMA INDIA
Research and Publications
Page No. 5 W.P. No. 2012-12-04
countries have also indicated that there is no evidence of modern retailers exploiting the producers
or consumers and it is more to do with policy paralysis than the actual practices of modern retailers
(Swinnen and Vanderplas, 2007). While modern retailing is fast penetrating in a developing country
like India, it is significant to understand that it is quite complicated to accurately assess its impact.
Even though modern retailers have invested in the supply chain in varying degrees, there ismixed
evidence that consumers ultimately fetch lower prices in the modern formats. As a result of this, it
has been critical for the modern retailer to understand the local consumption pattern to offer the
right mix in the rapidly changing Indian market. Some habits are unique to the country. Modern
retailers in India find it quite challenging to sell meat products because a large number of Indians
would deliberately avoid visiting stores dealing in meat, fish and poultry. There is a separate channel
for these fresh produce which is largely in the traditional format. With the increase in disposable
incomes, abundant media choices, internet penetration and modern amenities, the shopping activity
which used to be mundane necessity has become a pleasant activity for many consumers (Sinha,
2003). On one hand impulse buying and brand switching behavior has become more evident (Sinha
and Uniyal, 2005),on the other hand unnecessary shopping has increased leading to consumers
buying goods which are non-essential. With a greater focus on supply chain efficiencies, modern
retailing could do go better for both consumers and farmers.
Changing Consumption Patterns
In a developing economy like India, the biggest challenge a marketer faces would be to tackle the
ever changing consumption practices.The majority of the Indian consumers are shifting from brand
loyalist to value conscious, which would require greater efforts on the part of a retailer to satisfy the
billion demands and provision of enduring services. These changes are reflected in the growing
disposable income and per capita growth in the table below
vii
:
IIMA INDIA
Research and Publications
Page No. 6 W.P. No. 2012-12-04
Indicator 2010 2011 2012 2013 2014
GDP, Purchasing Power parity ($
Per Capita)
3453 3777 4103 4434 4819
GDP, Purchasing Power parity
(Per Capita %)
12 9.3 8.6 8 8.6
Gross Disposable Income Per
Household $
5295 6151 6867 7627 8447
Gross Disposable Income Per
Household Growth %
16.3 26.1 11.6 11.07 10.75
Rural Population % 70.21 69.98 69.75 69.53 69.3
Urban Population % 29.79 30.02 30.25 30.47 30.7
Source: Datamonitor Country Insight,2011
It has been evident that in emerging economies, with the increase in the number of retailers
entering the market, the shopping habits and consumption patterns evolve and moreover with the
growth of modern retail, the total set of offerings turns out to be more accessible to consumers
thereby helping the retailers achieve their broad objective of meeting the demands of diverse
audiences.The progress of modern retailers, with grocery sector in particular, is always not
dependent on the level of supply chain efficiencies. It is also influenced by consumer demand for
food quality and convenience. This leads to efficiencies gained between producers and consumers.
The high growth of modern retailers has witnessed growth of packaged and readymade foods
(Tandon et. al., 2011).
Household 2006 2007 2008 2009 2010 2011
Couple with children 3,29,364 4,01,651 4,37,863 4,48,467 5,55,701 6,22,907
Couple without children 82,941 1,05,418 1,16,065 1,19,630 1,49,432 1,68,575
Single parent family 10,012 13,149 14,473 14,926 18,646 21,039
Single person 6,825 8,115 8,603 8,547 10,319 11,292
Other 1,20,100 1,60,975 1,73,835 1,76,419 2,16,964 2,41,361
Total 5,49,241 6,89,308 7,50,838 7,67,990 9,51,061 10,65,174
Couple with children 3,001 3,596 3,854 3,882 4,734 5,223
Couple without children 1,984 2,446 2,617 2,625 3,195 3,517
Single parent family 2,214 2,825 3,025 3,039 3,702 4,078
Single person 1,012 1,204 1,276 1,268 1,529 1,672
Other 2,494 3,316 3,550 3,571 4,351 4,795
Total 2,603 3,210 3,437 3,457 4,212 4,643
Total US$Million
US$ per household
Consumer Expenditure
Source: www.euromonitor.com
IIMA INDIA
Research and Publications
Page No. 7 W.P. No. 2012-12-04
The modern retailers, whether domestic or international, have focused on investing in various retail
formats like supermarkets, hypermarkets, cash and carry stores and convenience stores which has
eventually led to the change in the overall consumer shopping behavior. The small stores are also
undergoing a change. It is found that in the food and grocery sector, hypermarkets would face more
competition from the Upgraded Kiranas1 than supermarkets (Sinha, Mathew and Kansal, 2004). The
smaller stores offer very high level of service and convenience and are able to tailor the requirement
to their customer much better that the larger stores, who so far have been competing on price and
wider assortment.
The emergence of modern formats tends to satisfy the desire for convenience and consumers prefer
these formats owing to high quality perceptions and safety characteristics (Veeck and Veeck, 2000).
Studies have shown that modern retailing is offering more choice to the consumer at the same or
lower price when compared to the traditional retailers (Minten et.al., 2010). It also leads to
customers exercising choices and becoming more variety seeking (Sinha and Uniyal, 2005).
1
Small mom and pop and general stores
-15.00
-10.00
-5.00
0.00
5.00
10.00
15.00
Utility of Current formats
IIMA INDIA
Research and Publications
Page No. 8 W.P. No. 2012-12-04
US$bn 2006 2007 2008 2009 2010 2011
Apparel Speci al i st Retai l ers 23.81 26.63 29.72 33.37 37.44 42.31
El ectroni cs and Appl i ance Speci al i st Retai l ers 7.18 8.26 9.08 9.90 10.99 12.28
Heal th and Beauty Speci al i st Retai l ers 7.32 8.21 9.09 9.92 10.96 12.15
Home and Garden Speci al i st Retai l ers 7.52 8.47 9.09 9.48 10.11 10.84
Lei sure and Personal Goods Speci al i st Retai l ers 13.92 16.31 18.15 19.78 22.48 24.93
Mi xed Retai l ers 0.71 0.98 1.22 1.23 1.50 1.85
Other Non-Grocery Retai l ers 0.36 0.39 0.43 0.46 0.51 0.55
Non-Grocery Retai l ers 60.82 69.26 76.78 84.14 94.01 104.91
Grocery Retai l ers 109.98 123.49 139.78 155.50 176.39 202.66
Retail Sales
Source: Euromoni tor Internati onal from offi ci al stati sti cs, trade associ ati ons, trade press, company research, trade
i ntervi ews, trade sources
The food and grocery segment remains the primary segment with around65% share in the total
Indian retail market segment. We have reached to 4% level in organized horticulture when
compared internationally where it has reached to 56%
viii
. The Indian food processing industry is
organized up to 25% and consumers are buying superior varieties and quality produce, evendiced
fruits and vegetables. The recent trends have also witnessed increase in consumption of fruits
although compared to vegetables, the former being expensive in the Indian market conditions. The
Indian consumers are projected to spend more on fresh food and it is estimated that there will be
130 million new consumers in India by 2015 as per theEuromonitor International's Countries and
Consumers database.
2015 2025 2015 2025 2015 2025
Globals (>1,000) 3.3 9.5 6.3 21.7 4.1 14.1
Strivers (500-1,000) 5.5 33.1 3.8 20.9 2.7 16.5
Seekers (200-500) 55.1 94.9 15.2 30.6 11.8 24.6
Aspirers (90-200) 106 93.1 14.6 13.7 12.2 11.9
Deprived (
The Indian retail industry is estimated to be $470 billion. The organized or modern retailing with 6% share stands at $26 billion. It is projected to reach US$ 1.3 trillion by 2018 with the organized retail market estimated to grow at the compounded annual growth rate of 40% and reach US$107 billion by the year 2013. Entry of these retailers in different formats, including online, has affected an irreversible change in consumer buying habits and businesses related to serving these retailers.
Development of Modern Retailing in India: It’s Impacts on
Distribution and Procurement Networks and
Changing Consumption Pattern
Piyush Kumar Sinha
Srikant Gokhale
Sujo Thomas
W.P. No. 2012-12-04
December 2012
The main objective of the working paper series of the IIMA is to help faculty members,
research staff and doctoral students to speedily share their research findings with professional
colleagues and test their research findings at the pre-publication stage. IIMA is committed to
maintain academic freedom. The opinion(s), view(s) and conclusion(s) expressed in the
working paper are those of the authors and not that of IIMA.
INDIAN INSTITUTE OF MANAGEMENT
AHMEDABAD-380 015
INDIA
IIMA INDIA
Research and Publications
Page No. 2 W.P. No. 2012-12-04
Development of Modern Retailing in India: It’s Impacts on Distribution and
Procurement Networks and Changing Consumption Pattern
Piyush Kumar Sinha
Professor, Indian Institute of Management Ahmedabad
Email: [email protected]
Srikant Gokhale
Adjunct Faculty, Indian Institute of Management Ahmedabad
Sujo Thomas
Academic Associate, Indian Institute of Management Ahmedabad
Email: [email protected]
Abstract
The Indian retail industry is estimated to be $470 billion. The organized or modern
retailing with 6% share stands at $26 billion. It is projected to reach US$ 1.3 trillion
by 2018 with the organized retail market estimated to grow at the compounded
annual growth rate of 40% and reach US$107 billion by the year 2013. Entry of these
retailers in different formats, including online, has affected an irreversible change in
consumer buying habits and businesses related to serving these retailers. However,
unlike many other countries, India has its own unique character of size, geographical
spread, cultural diversity, and multiplicity of formats being introduced at quick
succession. Retailers also face the challenge of developing infrastructure, on their
own or in cooperation with the government. This paper attempts to explore the
industry and evaluate the extent of its impact on distribution and procurement
networks and changing consumption pattern in India.
Key Words: India, Retailing, Distribution, Procurement, Consumption.
IIMA INDIA
Research and Publications
Page No. 3 W.P. No. 2012-12-04
Development of Modern Retailing in India: It’s Impacts on Distribution and
Procurement Networks and Changing Consumption Pattern
Introduction
India has witnessed a revolution in the last two decades owing to rapid urbanization and changing
consumption. This has led retailers to concentrate their energies and leverage their capacities to
harness the potential. The entry of the leading corporate houses into retail created a surge into the
growth of the industry. The Indian retail industry is estimated to be $470 billion. The organized or
modern retailing with 6% share stands at $26 billion.
i
The Indian retail sector is projected to reach
US$ 1.3 trillion by 2018and the organized retail market is estimated at compounded annual growth
rateof 40% which is anticipated at 107 billion US$ by the year 2013.
ii
As per the McKinsey Report,
'The rise of Indian Consumer Market', by the year 2025, the Indian consumer market is expected to
grow four fold
iii
. India with its current retail growth rate turns out to be one of the most prominent
countries for global retailers.
Since the liberalization of the Indian economy in the 1990s, there has been a continuous change in
the consumer buying behavior. The positive consumer sentiment has led to retailers expandingto
eventier 1 and 2 cities.The market dynamics in Indian retail industry are dissimilar when equated
with other countries and it is not easy to function in an Indian market. If we have a close look at the
unique demography of India, we would discover that it comprises of 25 states with different
culturaldistricts existing concurrently in a market. While urbanization seems to be mixing these
cultures, people tend to be living in coherent cultural group, mainly described by the state from
where they originate. Most stores have trading areas that are mixed in their demography,thereby
making the retailers work harder while meeting the varying demands of diverse consumers. The
areas consist ofheterogeneous group of consumers who have predominantly varying buying power.It
IIMA INDIA
Research and Publications
Page No. 4 W.P. No. 2012-12-04
is posited that for retailers in India, social class could be a better segmentation variable that other
demographic factors.
The main objective of this paper is to gain insight into the developments of modern retail from the
Indian perspective. This paper attempts to explore and evaluate the extent of its impact on
distribution and procurement networks and changing consumption pattern in India. The initial
section of this paper discusses the development of modern retailing in India alongside the nature of
the Indian retail industry. The next section of this paper enumerates the changing consumption
patterns due to the progress in modern retail and subsequently this paper examines the impact of
modern retail on the distribution and procurement. Moreover, FDI (Foreign Direct investment) in
retail,another major area of discussion having its bearing on the development of modern retail is
discussed.
Development of Modern Retail
As per the estimates of Indian Retail Report 2011, the modern retail in the next five years is
expected to would contribute to a minimum of one third of the marketof 40 trillion. This report
estimates that by the year 2016, the modern retail would have 19.3 percentage share of the total
retail market
iv
. For some leading consumer product companies, modern retailers contribute about
10% of their total sale nationally and about 20% in top 10 cities.
v
The preeminent outcome of the
development of modern retailing in India is an increase of choice among consumers. With the
advent of modern retailing in the emerging markets have witnessed developments in the areas of
TechnologyTransfer, enhanced quality levels of produce, products at competitive prices, better
procurement practices and enhanced employment opportunities.
vi
The development and growth of modern retailing is connected to the lower prices resulting from the
functional efficiencies in the supply chain (Minten and Reardon, 2008).Studies in the developing
IIMA INDIA
Research and Publications
Page No. 5 W.P. No. 2012-12-04
countries have also indicated that there is no evidence of modern retailers exploiting the producers
or consumers and it is more to do with policy paralysis than the actual practices of modern retailers
(Swinnen and Vanderplas, 2007). While modern retailing is fast penetrating in a developing country
like India, it is significant to understand that it is quite complicated to accurately assess its impact.
Even though modern retailers have invested in the supply chain in varying degrees, there ismixed
evidence that consumers ultimately fetch lower prices in the modern formats. As a result of this, it
has been critical for the modern retailer to understand the local consumption pattern to offer the
right mix in the rapidly changing Indian market. Some habits are unique to the country. Modern
retailers in India find it quite challenging to sell meat products because a large number of Indians
would deliberately avoid visiting stores dealing in meat, fish and poultry. There is a separate channel
for these fresh produce which is largely in the traditional format. With the increase in disposable
incomes, abundant media choices, internet penetration and modern amenities, the shopping activity
which used to be mundane necessity has become a pleasant activity for many consumers (Sinha,
2003). On one hand impulse buying and brand switching behavior has become more evident (Sinha
and Uniyal, 2005),on the other hand unnecessary shopping has increased leading to consumers
buying goods which are non-essential. With a greater focus on supply chain efficiencies, modern
retailing could do go better for both consumers and farmers.
Changing Consumption Patterns
In a developing economy like India, the biggest challenge a marketer faces would be to tackle the
ever changing consumption practices.The majority of the Indian consumers are shifting from brand
loyalist to value conscious, which would require greater efforts on the part of a retailer to satisfy the
billion demands and provision of enduring services. These changes are reflected in the growing
disposable income and per capita growth in the table below
vii
:
IIMA INDIA
Research and Publications
Page No. 6 W.P. No. 2012-12-04
Indicator 2010 2011 2012 2013 2014
GDP, Purchasing Power parity ($
Per Capita)
3453 3777 4103 4434 4819
GDP, Purchasing Power parity
(Per Capita %)
12 9.3 8.6 8 8.6
Gross Disposable Income Per
Household $
5295 6151 6867 7627 8447
Gross Disposable Income Per
Household Growth %
16.3 26.1 11.6 11.07 10.75
Rural Population % 70.21 69.98 69.75 69.53 69.3
Urban Population % 29.79 30.02 30.25 30.47 30.7
Source: Datamonitor Country Insight,2011
It has been evident that in emerging economies, with the increase in the number of retailers
entering the market, the shopping habits and consumption patterns evolve and moreover with the
growth of modern retail, the total set of offerings turns out to be more accessible to consumers
thereby helping the retailers achieve their broad objective of meeting the demands of diverse
audiences.The progress of modern retailers, with grocery sector in particular, is always not
dependent on the level of supply chain efficiencies. It is also influenced by consumer demand for
food quality and convenience. This leads to efficiencies gained between producers and consumers.
The high growth of modern retailers has witnessed growth of packaged and readymade foods
(Tandon et. al., 2011).
Household 2006 2007 2008 2009 2010 2011
Couple with children 3,29,364 4,01,651 4,37,863 4,48,467 5,55,701 6,22,907
Couple without children 82,941 1,05,418 1,16,065 1,19,630 1,49,432 1,68,575
Single parent family 10,012 13,149 14,473 14,926 18,646 21,039
Single person 6,825 8,115 8,603 8,547 10,319 11,292
Other 1,20,100 1,60,975 1,73,835 1,76,419 2,16,964 2,41,361
Total 5,49,241 6,89,308 7,50,838 7,67,990 9,51,061 10,65,174
Couple with children 3,001 3,596 3,854 3,882 4,734 5,223
Couple without children 1,984 2,446 2,617 2,625 3,195 3,517
Single parent family 2,214 2,825 3,025 3,039 3,702 4,078
Single person 1,012 1,204 1,276 1,268 1,529 1,672
Other 2,494 3,316 3,550 3,571 4,351 4,795
Total 2,603 3,210 3,437 3,457 4,212 4,643
Total US$Million
US$ per household
Consumer Expenditure
Source: www.euromonitor.com
IIMA INDIA
Research and Publications
Page No. 7 W.P. No. 2012-12-04
The modern retailers, whether domestic or international, have focused on investing in various retail
formats like supermarkets, hypermarkets, cash and carry stores and convenience stores which has
eventually led to the change in the overall consumer shopping behavior. The small stores are also
undergoing a change. It is found that in the food and grocery sector, hypermarkets would face more
competition from the Upgraded Kiranas1 than supermarkets (Sinha, Mathew and Kansal, 2004). The
smaller stores offer very high level of service and convenience and are able to tailor the requirement
to their customer much better that the larger stores, who so far have been competing on price and
wider assortment.
The emergence of modern formats tends to satisfy the desire for convenience and consumers prefer
these formats owing to high quality perceptions and safety characteristics (Veeck and Veeck, 2000).
Studies have shown that modern retailing is offering more choice to the consumer at the same or
lower price when compared to the traditional retailers (Minten et.al., 2010). It also leads to
customers exercising choices and becoming more variety seeking (Sinha and Uniyal, 2005).
1
Small mom and pop and general stores
-15.00
-10.00
-5.00
0.00
5.00
10.00
15.00
Utility of Current formats
IIMA INDIA
Research and Publications
Page No. 8 W.P. No. 2012-12-04
US$bn 2006 2007 2008 2009 2010 2011
Apparel Speci al i st Retai l ers 23.81 26.63 29.72 33.37 37.44 42.31
El ectroni cs and Appl i ance Speci al i st Retai l ers 7.18 8.26 9.08 9.90 10.99 12.28
Heal th and Beauty Speci al i st Retai l ers 7.32 8.21 9.09 9.92 10.96 12.15
Home and Garden Speci al i st Retai l ers 7.52 8.47 9.09 9.48 10.11 10.84
Lei sure and Personal Goods Speci al i st Retai l ers 13.92 16.31 18.15 19.78 22.48 24.93
Mi xed Retai l ers 0.71 0.98 1.22 1.23 1.50 1.85
Other Non-Grocery Retai l ers 0.36 0.39 0.43 0.46 0.51 0.55
Non-Grocery Retai l ers 60.82 69.26 76.78 84.14 94.01 104.91
Grocery Retai l ers 109.98 123.49 139.78 155.50 176.39 202.66
Retail Sales
Source: Euromoni tor Internati onal from offi ci al stati sti cs, trade associ ati ons, trade press, company research, trade
i ntervi ews, trade sources
The food and grocery segment remains the primary segment with around65% share in the total
Indian retail market segment. We have reached to 4% level in organized horticulture when
compared internationally where it has reached to 56%
viii
. The Indian food processing industry is
organized up to 25% and consumers are buying superior varieties and quality produce, evendiced
fruits and vegetables. The recent trends have also witnessed increase in consumption of fruits
although compared to vegetables, the former being expensive in the Indian market conditions. The
Indian consumers are projected to spend more on fresh food and it is estimated that there will be
130 million new consumers in India by 2015 as per theEuromonitor International's Countries and
Consumers database.
2015 2025 2015 2025 2015 2025
Globals (>1,000) 3.3 9.5 6.3 21.7 4.1 14.1
Strivers (500-1,000) 5.5 33.1 3.8 20.9 2.7 16.5
Seekers (200-500) 55.1 94.9 15.2 30.6 11.8 24.6
Aspirers (90-200) 106 93.1 14.6 13.7 12.2 11.9
Deprived (