FICCI-KPMG Survey says retail sector to double in 3 yrs

12 Dec '05

2 min read

Indian retailing is shifting gears and is set to double in the next three years, with food and apparel sectors expected to drive growth, reveals Federation of Indian Chambers of Commerce & KPMG survey.

The future is, indeed, bright but potential roadblocks such as high real estate cost, absence of distribution networks, antiquated regulations and shortfall of trained manpower could sour the retail story.

This prognosis on the Indian retail sector was released by Ms. Alka Sirohi, Additional Secretary, Department of Consumer Affairs at Footfalls, the International Conference on Opportunities & Challenges in Retail, organized by FICCI and the Department of Consumer Affairs.

Over 80% of the survey respondents feel that the largest opportunity for modern retail is in the urban centres particularly the metros and point to the key challenges in the sector as fragmentation of the market given the geographical spread and infrastructure glitches like lack of distribution and logistics

The following are the highlights of the FICCI-KPMG Survey:
· 70% of respondents expect over 40% growth per annum in next three years

· 91% feel food & grocery to be fastest growing segment

· Rural market for food, apparels, consumer items & durables over 50%

· Majority see India heading towards mall over-capacity

· Retail space and cost seen as prime constraints

· Lack of distribution networks and logistics hubs key impediments

· Antiquated regulation will restrict rapid growth

· Shortfall of trained manpower to become critical

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