Impact of the Slowdown Economy on Retail Industry

Presence of Indian retailers through various formats:

Future Group: Pantaloons, Big Bazaar, Food Bazaar, Central, Home Town, Fashion Station, eZone, Planet Sports, Ethnicity

RPG Group: Spencer's, Spencer's Hyper, Music World, Books and Beyond

Tata Trent: Westside, Fashion Yatra, Landmark, Star India Bazaar (Tesco)

Bharti Retail: Easyday, Easyday market TM, Bharti Walmart

K Raheja Group: Shoppers Stop, HyperCity, Crossword, Stop & Go, Mothercare, HomeStop, Gourmet City

Reliance Retail: Reliance Mart, Reliance Value, Reliance Select, Reliance Trendz, Reliance Jewels, Reliance Digital, Reliance Wellness, Reliance TimeOut, Reliance Footprint

Impact of the slowdown:

Sales growth for Dec 08 quarter slid to 15% from 65% (Sep) and 61% (Jun)
Net profits fell by more than half, after declining 15% in September 08 and growing 8% in June 09
Footfalls declined, same-store sales succumbed, discount periods extended
Consumers continued to spend on groceries and food, curtailing discretionary spending on electronics and furniture
FMCG cos. curtailed supplies to retailers for default in payments
Retailers scaled-back expansion plans
Retailers shut down unviable store formats, relocated stores to stem losses
Retailers lowered operating costs by re-negotiating rentals, electricity cost and rationalized employee salaries
Customized product assortment in each store to suit particular locality, improve processes
Spruced up consumer experience, scaled down back-end infrastructure to save on capital
Worked on inventory optimization by lowering no. of units of a particular SKU

About the Author:

The author is Assistant Professor in Trinity-IMI International Business School (An RPG Enterprise initiative).

Source: http://www.articlesbase.com/

Image Courtesy:

ibtimes.com
business.rediff.com