Overall Retail Trends

In the current business environment a confluence of market forces has created an extremely complex climate in the global retail industry. In mature markets, retail sector is challenged by its inability to grow and maintain profit margins as a result of a constrained operating environment, market maturity & saturation, slow population growth, and more demanding consumers as well as highly volatile consumer behaviour. Apart from these there are concerns of rising competitive pressures, transformation of alternative sales channels- including "Bricks (stores), Clicks (web), Rings (call centers), and Knocks (services to the home), a blurring of roles between suppliers and retailers."

Also, as consumers have become empowered through access to information, wherever and whenever they want it, retailers have become more relevant to the consumer at the point of purchase and hence a shift in the balance of power to the retailers.

As an outcome, the strategic focus of the entire retail sector is moving towards the emerging economies of Asia and Central & Eastern Europe- China and India in particular. These economies offer expanding consumer markets with new opportunities for growth through global sourcing, off-shoring and the huge potential for development of modern/ organized retailing.

Trends in major markets

US

Retail is the second-largest industry in the United States both in number of establishments and number of employees. The U.S. retail industry generates $3.8 trillion in retail sales annually ($4.2 trillion if food service sales are included), approximately $11,993 per capita. The retail sector is also one of the largest worldwide. Wal-Mart is the world's largest retailer and the world's largest company with more than $312 billion (USD) in sales annually. Wal-Mart employs 1.3 million associates in the United States and more than 400,000 internationally. Retail trade accounts for about 12.4 percent of all business establishments in the United States. In USA, Single-store businesses account for over 95 percent of all U.S. retailers, but generate less than 50 percent of all retail store sales.

UK

In UK, 11% of all VAT-registered businesses are retailers; with the total number currently at 180,875.UK retail sales were 265 billion in 2007, which is much larger than the combined economies of Denmark and Portugal. The Retail sales of the country account for 1/5 of its total economy. The retail sector generates almost 8% of the Gross Domestic Product of the UK. More than a third of consumer spending goes through shops. The Sales over the internet account for less than 4% of total retail sales, despite there being a strong growth in recent years. Over 3.0 million people were employed by the retail industry by at the end of December 2007 which is almost 11% of the total UK workforce.