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<ul><li>We bring to you a series of columns from industry expert, looking back at the last 10 years</li><li>The columns will explore how the media, marketing and advertising industry has transformed in the last decade</li><li>Ravinder Singh, Founding Director, 1-India Family Mart pens down the changes the <keyword id="188491" type="PERSON" weightage="20" keywordseo="retail-industry">retail industry</keyword> has witnessed between 2010 and 2020 </li></ul>Retailing in India has emerged as one of the most vigorous and fast-paced industries after travelling through different phases over the years. In fact, India is the fifth largest preferred retail destination globally and embraces a very strong position as far as its market potential is concerned. Retailers are consistently trying to tap the gravity of this potential by using the latest technologies along with new generation tools like data analytics, social commerce, CRM solutions, etc, which form the backbone of modern retailing. Bolstered by healthy economic growth, changing demographics, increasing disposable incomes, urbanisation, changing consumer tastes and preferences, and higher consumer confidence, year 2019 experienced strong retail sales. While traditional and unorganised retail formats continue to dominate the retail market, organised retail is growing at a faster pace driven by technology intervention. The industry is now expected to reach $1400 billion by FY2024 from $790 billion in FY 2019, growing at a CAGR of 12%. The dawn of technology in the retail space has transformed the traditional business model into a ‘Phygital’ experience with in-built metrics to comprehend customer needs. Emerging technologies like AR, VR, Artificial intelligence, IoT, cloud platforms, etc. take into consideration multiple consumer interactions through digital platforms in the form of reviews, suggestions and AI-based product assortments, to make in-store digitization possible. By connecting with the consumers at all possible touch points, these techniques are also enabling the retailers to influence consumer behaviour. With technology being a key facilitator in driving engagements and with existing consumers and acquiring new customers, retailers can foresee increased sales and reduction in the cost of operations. Meanwhile, considering the growing consumer consciousness and their preference for choice and convenience, retailers are leveraging data-driven technologies to meet their expectations. Key learning for the retailers to emerge as game changers in 2020 The evolving mind-set of Indian consumers expecting seamless shopping experiences across every channel; brick and mortar stores, e-commerce platforms or mobile apps, demand the retailers to work consecutively towards acquiring competitive advantage in 2020. This can be done by using these innovative retail formats and technologies: <ul><li>Experiential retail: Millennials tend to make the majority of their choices based on their experience instead of the products. So, retailers must focus on developing a customer-centric approach in their businesses, where the consumer can interact with the product or brand and give their feedback as well. An interactive methodology would enable the retailers, especially in the brick-and-mortar circle, to initiate a better brand recall and increased sales. </li></ul><ul><li>Immersive technologies: While online players specifically in fashion &amp; lifestyle and beauty &amp; personal care segment are already making it big by embracing the concept of experience-based shopping using AR/VR, offline stores too are joining the bandwagon by implementing these immersive technologies to redefine convenience for consumers. This means consumers can now simply walk in, find their preferred products/outfits through a virtual inventory and try the outfits via virtual mirror without actually having to do it physically. This combination of technology in stores would facilitate seamless experience to the consumers. In fact, by 2020, the retail industry will emerge as the top spending industry on AR and VR. </li><li>Big Data: Leveraging Big Data to observe and evaluate buying patterns, trends, etc, has been quite revolutionary in the online retail industry. It is now making its way into the offline retail space to create a significant effect on its future. Big Data can enable retail businesses to understand their customer expectations by predicting the popularity of products and identifying the relevant customers for each one of them. </li><li>Social commerce: Millennial consumers are becoming more demanding with time and this can pose challenges for the retailers in future to get their brand noticed amid all the traffic. Social commerce platforms can enable retailers to raise brand awareness and drive direct engagement with customers through pictures and videos of products or brands posted by the latter. Retailers can capitalise on the consumers sharing their experiences and stories on the web in the form of reviews and recommendations. </li></ul>The expectation from modern retail has transformed completely, as the idea here is not just to enhance the experience but also being able to guide the consumers towards making the right purchase decisions by understanding their profile. Having realised the tremendous scope of mass digitization in the retail ecosystem, retailers now must take proactive steps to streamline their day to day operations in 2020, making it exciting and rewarding time for all the stakeholders in the industry.

Indian retail industry: The year that went by and outlook for 2020

The Indian retail space has been going through a lot of ups and downs in the recent times. On one hand, there is hope and optimism for foreign retailers as the government mulls scrapping the 30% local sourcing clause. On the other hand, rising real estate costs, cut throat price competition and policy challenges are hindering both Indian as well as foreign retailer’s growth plans in the country. Trouble in Indian retail has impacted both the Indian as well as the international players. In fact, according to a report by ratings agency Crisil, the top 10 retailers in India are estimated to have a total loss of Rs 13,000 crore in the financial year 2013-14. 
 
The trouble waves The French retailer <keyword id="57606" type="COMPANY" weightage="100" keywordseo="Carrefour">Carrefour</keyword>’s decision (that came in July this year) to exit the country due to failure of viable business is one of the major upsetting news for the <keyword id="188491" type="UNKNOWN" weightage="100" keywordseo="retail-industry">retail industry</keyword>. The company will close all five of its cash and carry stores in India by September 2014, with subsequently winding up its business. Carrefour is one of the largest retailer, next only to <keyword id="80487" type="COMPANY" weightage="100" keywordseo="walmart">WalMart</keyword>, and it had big plans for India. But unfortunately, it has now decided to wind up its cash and carry business in the country. The company, led by chief executive Georges Plassat, has been closing its operations in countries that have shown sluggish performance over the years such as those in Singapore, Malaysia, Greece and Colombia. 
 
What is worse is that the heat is faced not just by the international retailers but also by the indigenous ones like Reliance Retail. The company which has about 550 Reliance Fresh stores across the country is shutting down about 100 of these stores. This is not the first time that an Indian supermarket retail company is shutting down stores. Just couple of years back Aditya Birla Retail which has the ‘More’ brand shut down all its store in Mumbai due to being unable to manage the rising real estate costs. Another retailer Spencer’s too have cut down on its number of stores. 
 
Rising real estate costs as challenges 
One of the biggest troubles for retailers in the country, both foreign as well as Indian chains, has been the rising real estate costs. The cost of renting space for supermarkets have been on a crazy upward trend and with the margins in the retail business, most of the retailers are not able to make business sense with these high rocketing real estate costs and this has been a big downer for the retail industry discouraging brands not just from expansion, but also leading them to shut shops in question of viability. The real estate costs need to be worked to out to give a boost to retail segment. 
 
The challenge of logistics 
Another big hurdle that is faced by retailers is managing the logistics for perishable items like food. Food and groceries contribute largest to the consumption pie with a huge 60% share but the problem is that the margin on food items for retailers is pretty low. At the same time the cost to store them and manage their inventory goes high due to their perishable nature. This has been big challenge retailers have not been able crack well and thus are struggling. 
 
Policy trouble 
The 30% local sourcing mandate of raw materials is a big challenge, especially for luxury and premium foreign retailers in the country. The policy, where state governments are given the power on whether to allow an international retailer to enter their state or not, creates a big hurdle for these players. They have to go through the bureaucracy web multiple times (each state) to work their way in India. That’s quite a challenge and is restricting growth plans of many international players. 
 
Going ahead, the road seems to be shaky for the retail industry but it is expected to soon shape well with certain policy changes expected round the corner. Well, these changes should happen soon to ensure the industry doesn’t go through too much of turmoil.

Indian Retail Industry Facing Heat, What Is Causing The Trouble?

New Delhi, June 11 (IANS) The Indian retail industry is set to witness Artificial Intelligence and data-led disruption opportunities, particularly with a 3X growth projected in the e-commerce and organised retail sector by 2024, a Nasscom report said on Thursday. According to data from the Indian Brand Equity Foundation (IBEF), the overall Indian retail sector is poised to witness a 2X growth by 2024 and will be valued at $1.4 trillion. While retail in India is dominated by the unorganised sector, as much as 85 per cent in 2019, the opportunity for digitalization is immense with AI set to play a pivotal role. This will be even more pertinent as the economy looks to recover amidst Covid-19, by attempting to overcome several unseen challenges, such as broken supply chains and reduced discretionary spend, along with a sudden rise in the demand for contactless deliveries that will require digitised and AI-based solutions. These solutions can enable predictive demand forecasting, customer hyper-segmentation, supply visibility and the ability to respond to real-time demand signals to build sustainable and adaptable long-term business models in this industry, said the report titled "Indian Retail: AI Imperative to Data-Led Disruptive Growth". This shift in consumer preferences is creating the need for the digitization of stores and collaboration with micro, small and medium-sized enterprises across the value chain, which is further accelerating the growth of data-driven retail. "The retail industry in India has been flourishing with an ever-increasing consumer base and is emerging as one of the most dynamic sectors," Debjani Ghosh, President, Nasscom, said in a statement. "With the entry of global players and rise in modern retail formats, we are witnessing rapid digital transformation that in turn enhances the entire operational and customer experience." In the quick-win use cases that have proven successful in business impact, enterprises can prioritise on AI-driven customer service chat bots, counterfeit detection and dynamic pricing tools, as they initiate their AI journey. Automated store checkouts and robotic warehouse management systems could be big bets for retailers, having high business impact but also requiring higher implementation effort. In other strategies, even new product planning and development, delivery agent assistance and identifying deals and discounts for the market can prove to be beneficial, said the report. The research showed that more than 50 per cent retail enterprises believe that customer experience, operational efficiency and revenue growth are priority areas for applying AI in retail, while over 80 per cent of retail enterprises believe that reskilling existing talent is key to driving effective AI adoption. --IANS gb/na

AI, data-led disruptions to drive growth of Indian retail: Nasscom

Recently, there seems to be a new wave of hope for a kick in the foreign direct investment (FDI) in single-brand retail space, with the government considering the scrapping of compulsory 30% <keyword id="2459072" type="UNKNOWN" weightage="100" keywordseo="Domestic-Sourcing-Clause">domestic sourcing clause</keyword>. The <keyword id="6423836" type="ORGANIZATION" weightage="100" keywordseo="Department-of-Industrial-Policy-and-Promotion">Department of Industrial Policy and Promotion</keyword> (DIPP), under the Commerce Ministry, is reviewing this restrictive clause, which is a major bottleneck. If implemented, the move promises to open up a plethora of opportunities for global players to boost expansions in areas such as clothing, electronics and luxury goods. 
 
Sourcing clause takes away the authenticity of the brand Till now, this clause has played deterrent to the interests of foreign brands as it makes it imperative for the single-brand retailers to compulsorily source at least 30% of the value of the goods sold in India from Indian <keyword id="2459073" type="UNKNOWN" weightage="100" keywordseo="small-scale-manufacturers">small scale manufacturers</keyword> (SMEs) and/or village and cottage industries, artisans and craftsmen. However, these businesses have created a unique brand promise and imagery based on the quality of their products, and often, they are not able to meet the same quality standards with local sourcing. 
 
In addition, these players comply with strong process orientation and follow uniform business strategies along with having global supply chain. Hence, it becomes difficult to source local vendors, as that means losing out on the authenticity of the brand. Thus, if the government scraps the sourcing clause completely, it can really make it a lot easier for these foreign brands to ensure their quality as well as credibility. 
 
Smoother implementation 
Moreover, this 30% sourcing clause also creates implementation hurdles for foreign brands. At the moment, there is no strict supervision over product and inventory with local manufacturers and vendors on whether this norm is actually complied by companies or not. This poses a bigger threat for these companies as, if after five years, the government wants to verify the compliance, there may not be enough evidence to prove anything and that could lead to a risk of them facing a non-compliance situation, which may or may not be true. With this ceiling of 30% local sourcing gone, it will mean smoother implementation and function for the single-retail companies, which in turn, will encourage them to expand and grow faster in the country. 
 
More beneficial for luxury brands 
The changing consumer demographics and exposure to international brands have attracted the interest of premium and luxury players to open stores in India. For instance, luxury group Richemont, whose stable of brands includes Cartier, Van Cleef and Arpels, is willing to enter the single-brand retail space. If the clause is done away with, it will be a favourable move for such brands as SME sourcing for high end labels will remain a challenge. 
 
Moreover, as these brands make only a few thousands of pieces and also change product lines quite often, it is a herculean task to comply with the local sourcing prerequisite with such small amounts of product. Scrapping this rule will mean easier operation for luxury and premium brands like Gucci, LMVH, Cartier, etc and thus, make them more inclined to expand and invest in the country’s retail space. 
 
Encourage the shy companies 
Due to this local sourcing ceiling, the single-brand retail model becomes too complex, causing many companies like Apple and H&amp;M to shy off from investing in the country. If this hurdle is removed, these and many more companies will be inclined to invest more, which means increased FDI inflow for the retail space. 
 
The sourcing condition was also being seen as impacting investments by technology companies as any overseas company looking to own more than 51% of a single-brand retailing venture would have to comply with the norm. The move will also allow companies such as Apple to open stores. 
 
Analysts believe that a more favourable environment for high-end labels will see a tremendous spurt in the economy. Over Rs 300 crore has been invested in the retail space from foreign investment over the last two year period. This has resulted in more jobs which is a key growth driver, especially in a slowing economy. 
 
Clearly, scrapping this 30% sourcing rule will mean a lot for the Indian retail space and also the overall economy in general. Thus, from pure industry viewpoint, this might prove to be a complete game changer for the Indian retail industry. 
 
The previous government allowed 100% FDI in single-brand retail in 2011 with mandatory 30% sourcing from small and medium enterprises.

FDI
In Retail To Get A Boost As Govt Mulls Scrapping Domestic Sourcing Clause

In a bid to reach online shoppers, Infiniti <keyword id="6354851" type="ORGANIZATION" weightage="20" keywordseo="Retail">Retail</keyword> Ltd has entered into a strategic alliance with <keyword id="541988" type="COMPANY" weightage="20" keywordseo="SnapDeal">Snapdeal</keyword>.com to offer products across consumer <keyword id="6380512" type="UNKNOWN" weightage="20" keywordseo="electronics">electronics</keyword> such as mobiles, tablets, and Laptops among others available on <keyword id="152739" type="COMPANY" weightage="20" keywordseo="Croma">Croma</keyword>’s flagship Brand Store. 
	 
	In the first phase of the partnership, Croma and Snapdeal.com would come up with market development initiatives as well as develop programmes to reach out to customers and vendors. “This is a big moment for us, where Croma and Snapdeal.com will now leverage their offline and online presence respectively and work jointly to offer a more holistic shopping experience to consumers across the country. We are extremely excited to launch Croma’s Flagship Store on Snapdeal.com,” said Kunal Bahl, Co-Founder and CEO, Snapdeal.com 
	 
	He added, “With this partnership, we will now be able to expand our electronics products’ portfolio like never before. This will help us deliver great value to our customers by offering them the widest assortment of products housed by the Croma stores. We look forward to a continuing long term &amp; mutually beneficial partnership.” 
	 
	Ajit Joshi, Managing Director and CEO of Infiniti Retail Ltd talked about the changing scenario of the retail industry and the growing importance of online retail stores in the country. “Today’s dynamic retail industry demands an infrastructure that is equally robust on the online and brick-and-mortar fronts. Omni-channel retail is undoubtedly the way forward in the Indian retail industry, and therefore the association is designed to enable Croma and Snapdeal to leverage from each other’s strengths, to provide a winning proposition for customers and business alike.”

	Both retail brands will also announce exclusive launches of products and brands belonging to the consumer electronics categories.

Croma To Woo Indian Consumers; Ties Up With Snapdeal

This festive season will bring cheer for the Indian <keyword id="6354851" type="ORGANIZATION" weightage="20" keywordseo="Retail">retail</keyword> industry—especially the tableware industry, which is expecting sales to rise by 50% during the <keyword id="188" type="ENTERTAINMENT" weightage="20" keywordseo="Diwali">Diwali</keyword> season. Industry experts have predicted that the festival season generates maximum sales for tableware players in the entire year. 
	 
	“Over 60% of the revenue is generated during Diwali since it is a festival time and people like to splurge. With a buoyant consumer sentiment in the market this year, we are expecting substantial increase in the sales,” said industry expert Susant Das. 
	 
	He elucidates further that this year Diwali sales look brighter as the overall economy has improved, which is boosting manufacturers’ and retailers’ margins. 
	 
	“The manufacturers are offering attractive schemes as well as coming up with new marketing strategies to woo consumers in this festive season,” added Das. 
	 
	Industry experts suggested that retailers have registered numbers down South because of Onam, retailers in North and East will witness a substantial increase in the sales as the festival season nears. While in the Northern region, brands expect the sales to surge because of Diwali, in the East, people will buy because of Durga Puja. Analysts are expecting the sales to pick up by the first week of October. 
	 
	The Year Gone By 
	 
	Last year, the tableware industry had witnessed a dip of 25% in the sales around the festive season. However, Diwali sales in the retail market last year seemed gloomy as the consumer sentiments had been marred by high inflation that had brought in a change in their purchase patterns. 
	 
	“The rising prices did not leave much of a scope for people to splurge on tableware products like crockery, especially ceramic and glassware which has witnessed the sales dwindling considerably”, said Das. 
	 
	Domestic manufacturers in the industry too had scaled down their expectations in 2013. “The cost on imports had substantially gone up due to the depreciating rupee value which had put pressures on local retailers to demand for the local goods,” said a top official of tableware manufacturer who requested anonymity. 
	 
	Corporate customers, who have been a major customer for tableware players, too had shifted their choice of gifts this festive season. “Companies have been important buyers of dinnerware or kitchenware goods. However, last year, they had preferred to give cash or gadgets as Diwali gifts to their trade partners and employees,” noted Amitabh Airi, another industry expert. 
	 
	The Forecast 
	 
	According to market estimates, the industry size is pegged at around Rs 2,000 crores, which includes glassware, ceramics, and kitchenware. The luxury tableware market is anywhere close to 15% of the total volume of this industry. “The ceramics tableware is slowly picking up as people are getting more aware about the health hazards from the different other forms of tableware be it melamine, plastics, steel, nonstick or any other material,” Das added. 
	 The ceramic segment tableware industry is primarily dominated by foreign brands such as Shinepukhur Ceramics from <keyword id="6354759" type="COUNTRY" weightage="20" keywordseo="Bangladesh">Bangladesh</keyword>, Noritake from <keyword id="6355311" type="COUNTRY" weightage="20" keywordseo="Japan">Japan</keyword>, and Danktuwa from Sri Lanka; among the domestic players Goodearth, Artinox and the recently launched Azure rule the roost. The glassware category of products are offered by both <keyword id="87" type="COUNTRY" weightage="20" keywordseo="Germany">Germany</keyword> based Reidel and Nachmann. On the other hand, the mass segment is dominated by Indian players like Bharat Potteries, Claycraft Ceramics, Sonaki Ceramics and other Chinese products. Surprisingly, <keyword id="8555" type="CITY" weightage="20" keywordseo="Tata">Tata</keyword> Ceramics has a negligible market share though they have been producing good quality tableware products. 
	 
	“This time around, players in the high-end segment are expecting high volumes along with higher margins in the festive season. While in the mass segment, the margins may not be higher when compared to the considerable surge in the volumes,” said a wholesale trader. 
	 
	Representational Image

This Diwali Season, Tableware Industry Sales To Rise By 50%

<keyword id="23820" type="General" weightage="20" keywordseo="footwear" source="Orion">Footwear</keyword> retailers have sought more time for the implementation of norms of the Quality Control Order, 2020 (QCO), for footwear manufacturers. QCO norms for footwear are slated to be enforced from July 1 in the country. Retailers have urged the government to give them 8-10 months of additional time from the effective date of the QCO for footwear manufacturers. This request is meant to allow retailers to place orders and procure stocks of Bureau of Indian Standards (BIS)-compliant footwear from manufacturers, the retailers said in their request. The Department for Promotion of Industry and Internal Trade (DPIIT) issued QCO for footwear made from leather, rubber or polymer. Once implemented, it will make it compulsory to conform with the Indian Standards and footwear products will also be required to bear a Standard Mark under a licence. Saurabh Sanyal, CEO and Secretary, PHD Chamber of Commerce and Industry (PHDCCI), said that the implementation of QCO at this crucial juncture without much time for transition for the retail industry has created a precarious situation and will be an impediment to the operation, growth and sustenance of the footwear retail sector. "While the industry is gearing up for readiness of QCO compliance for new manufacturing, as of now there has been no clarity for applicability of QCO on the inventory manufactured or procured prior to June 30, 2023 (before QCO effective date), for which large capital has been deployed by pan-India retailers while incurring a huge amount of taxes, duties and levies," Sanyal said. The retailers said that most of the manufacturing plants still do not have internal testing facilities within their premises. They will require further investments and time for setting up such facilities before applying for the BIS registration and certification process. According to the PHDCCI statement, only a miniscule of manufacturers or suppliers have been able to receive the BIS licences till date with 30 licences issued across 10 leather footwear categories, and 18 licences for 13 categories of non-leather footwear. At the current pace, the certification process for most manufacturers will not be completed even after the QCO's effective date, it added. Moreover, the retail industry players said that they were determined to adopt the QCO and are aligned with Prime Minister's clarion call for "Zero-Defect-Zero Effect" manufacturing. They said that while the manufacturers have already commenced the process for getting BIS registration and licences to comply with QCO requirements, the existing infrastructure and testing facilities are not sufficient to cater to the current requirements of stringent BIS testing and certification for all the manufacturers and products being manufactured. BIS had still not come up with product manuals for some standards, testing equipment required, testing methodologies and procedures, they added. SEE ALSO: <a href="https://www.businessinsider.in/business/auto/news/mg-comet-ev-two-door-electric-car-with-230-km-range-launched-in-india-check-out-price/slidelist/99779639.cms">MG Comet EV with a 230 km range launched in India starting at ₹7.98 lakh</a> <a href="https://www.businessinsider.in/business/news/jiocinema-may-soon-launch-premium-subscription-plans-offering-4k-content-starting-at-2-per-day/articleshow/99736111.cms">JioCinema may soon launch premium subscription plans starting at ₹2 per day</a> <a href="https://www.businessinsider.in/business/auto/news/mahindra-bolero-roars-past-1-lakh-sales-mark-in-fy23/articleshow/99725410.cms">Mahindra Bolero roars past 1 lakh sales mark in FY23, proving it's still a favourite amongst Indians</a>

Footwear retailers seek 8-10 month extension to implement BIS quality control order

The Indian <keyword id="6354798" type="ORGANIZATION" weightage="100" keywordseo="coffee">coffee</keyword> retail market has been buzzing over the last 12 months with two key players <keyword id="6377922" type="CITY" weightage="100" keywordseo="Starbucks">Starbucks</keyword> and Cafe Coffee Day on expansion drive. The market size of retail coffee in India is estimated at Rs 1700 crore plus and expected to grow at a fast pace of over 20% in the recent times. This story explores what are the key drivers fuelling the industry and what are the key challenges breaking its growth speed. 
 
The good: What’s working and key drivers 
 
Expansion drive: The entry of global coffee retailer Starbucks has turned out to be one of the key growth drivers of the coffee retail market. Since the launch of its first store in 2012, the coffee retailer has opened 50 stores across Delhi, Mumbai, Pune, Bangalore and Chennai. Starbucks’ India operations are a part of Tata Starbucks Ltd, which is a 50:50 joint venture between the US coffee retailer and Tata Global Beverages. Starbucks stores attract not only the regular coffee goers (which are the youngsters), but it also has lured the executive segment which otherwise stayed away from coffee shops due to their association with being a spot for college goers. 
 
On the other hand, Cafe Coffee Day, India’s biggest coffee retailer, has launched approximately 150 stores over the last one year. The total store count of this retailer is about 1550, with presence in 200 cities. This increase in the total number of stores and Starbucks brand name has added to the growth and expansion of this market. 
 
Increasing disposable income and expansion of consumption culture: Another key drive which has given a boost to the Indian coffee retail space is the increase in consumption culture, westernization and increased disposable income. Over the last one decade, Indian consumers have shifted from being saving oriented to be more consumption oriented, more so in the last 4 years. This shift in our consumer behaviour has taken away the mental barrier on spending on eating out. Thus, Spending Rs 200-400 on a cup of coffee along with some food is not big deterrent for today’s Indian consumers. 
 
Different formats to catch every consumer segment: Cafe Coffee Day follows a mix of various formats including mall formats, highways, Lounge (premium upscale format) and Square (which is a single-origin coffee destination). Having these different formats has helped it tap into the various consumer segment in the market with their different spending power and preferences. This has been quite a smart strategy and a few small coffee retailers are also following this format to tap this market better. 
 
Indianisation: One of the key reasons of Starbucks instant success in India is being attributed to its Indianisation of store ambience as well as food menu. Most of the stores of this US retailer have interiors done with an Indian flavour. Hand-carved wooden screens, tables of solid Indian teak, painted vintage trunks, Indian theme paintings, etc. are a key part of the stores. The indianisation is clearly visible in the menu too. So there is a Reshami Kabab fighting for your attention against the Classic Breakfast Chicken Sandwich. The Indian Chai Latte, Murg Kathi Roll, Konkani Twist, etc. are a few other options that add Indian flavour to the offering of Starbucks in India. Experts believe that this Indianisation of the menu, particularly, food has really helped increase spending per person/group in a single visit and also ensured repeat visits of families. While the standard global offerings like blueberry muffic, Sandwich biscuit, quiche, etc. keeps stays to be an attraction for the younger as well as corporate consumers. 
 
 
The bad and the ugly: Key challenges 
 
The struggle: The coffee retail is a segment which has also seen many players struggling and failing. With more than 3100 stores across the country and the industry size of Rs 1700 crore, the competition is quite intense with very less margin for error. Barrista, which had quite a good footing for a few years, is seemingly more lost with its parent Lavazza scouting for a buyer. Gloria Jean, which has been struggling since its launch in India is considering to pull out. Costa Coffee which is world’s second largest coffee retailer and has been in India for quite a few years, has still not been able to find a strong footing and has about only 100 stores after all these years of operation in the country. 
 
Two player battle: So far, the Coffee retailing market seems largely a two player battle between Cafe Coffee Day and Starbucks, primarily because they seem to have winning Indian consumer’s heart as well as their wallet. This is another challenge for the market’s overall growth. Unless, other players don’t hit it off with the consumers expanding the market will remain a challenge. With more players getting established, there will be more innovation, better service, better quality which will boost the sector’s growth. But that seems to be lacking at the moment. 
 
The economic impact: The economic slowdown of 2009 did hit the coffee retail sector majorly, as with incomes and job securities going down, people did became cautious in nature. Industry experts believe while things have started to look up more recently, consumer approach is still not back to what it was back in 2008. 
 
Real estate costs: High real estate cost is another challenge that cuts into the margin of coffee retailers. While these costs have gone down slightly in the last couple of years, it still is quite high. In a good location, almost 505 of the enterprise cost goes for the real estate. This affects the overall costing and profitability of the coffee retailers.

Indian Retail Coffee Market: The Good, The Bad And The Ugly

Earlier this month, <keyword id="18635" type="CITY" weightage="100" keywordseo="Amazon">Amazon</keyword>'s founder and CEO <keyword id="191583" type="PERSON" weightage="100" keywordseo="Jeff-Bezos">Jeff Bezos</keyword> had sent offers of Rs 200 gift cards to millions of Indians. This was done as a marketing gimmick for Amazon, but did not go down too well with the country's brick-and-mortar retailers. 
 
The Retailers Association of India have filed a complaint with the Indian government and have accused Amazon of violating foreign investment laws by offering gift vouchers to its customers. 
 
"Just two and a half years from our launch, Amazon.in has become the most visited ecommerce site in India. This customer response continues to amaze and energise us. To celebrate and thank customers for their confidence in us, we are happy to announce an Amazon.in gift card of Rs 200 for all customers who shop on Amazon.in today," the email sent by Bezos had stated. 
 
The retailers' association, however, have filed a case in the Delhi High Court alleging that ecommerce firms from across the globe are flouting Indian FDI laws. 
 
"Such transfer of 'cash value' to end-consumers, incentivising end-consumers to shop on a website - does this pass the test of B2B business transaction even when cash is directly being offered to retail customers?" a letter written by RAI and sent to Amitabh Kant, secretary in the Department of Industrial Policy &amp; Promotion, stated. 
 
Ecommerce companies, including Amazon and domestic rivals Flipkart and Snapdeal, claim that they operate on a marketplace model, only offering platforms for Indian retailers to trade. 
 
Indian retailers, however, opine that such claims hold no value if these companies offer such gifts. "Giving customers Rs 200 is what, if not retail?" an unnamed senior retail executive asked ET. 
 
<a href="http://blogs-images.forbes.com/briansolomon/files/2014/04/jeff_bezos-e1398439038826.jpg">Image source</a>

Jeff Bezos’ Christmas gift to Indians makes brick-and-mortar Indian retailers see red

New Delhi, Dec 20 () Awareness among Indian consumers towards sustainable and ethical practices of brands has increased, which has led to a significant shift in their behaviours, according to a report.
 This shift indicates need for retailers to immediately develop capabilities, to meet this change in purchasing patterns also, said the joint report by industry body CII and global management consulting firm AT Kearney.
 "There is increasing affinity with brand prestige and sustainability, and a willingness to shift purchases towards brands with higher ethical practices and sustainable processes," said the report titled 'Building towards sustainable retail'.
 This increased awareness has driven a significant shift in consumer behaviours towards sustainable products and sustainable retail.
 "Consumers, especially Indian consumers, associate brands' sustainability and ethical practices with 'trust on the brand' -- a key driver for brand preference," it added.
 Indian consumers' purchasing habits dovetail with global trends.
 According to the report, the retailers ignoring this trend will likely miss out on a sizeable opportunity to tap into a new, growing consumer base.
 It also added that the Indian companies emerging on the sustainability plank have increased over the past few years.
 "There is a growing recognition of the shift in the consumer mindset towards environmentally and ethically conscious brands and this has forced retailers to tailor their product and brand-building strategies accordingly," it said.
 Large Indian conglomerates have already initiated green supply chains.
 Majority of the retailers have adopted the United Nations' Sustainable Development Goals, paving the way for more sustainable, healthy consumption worldwide. KRH HRS

You Searched For "indian retail industry" and got 10 results

Indian retail industry: The year that went by and outlook for 2020

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Footwear retailers seek 8-10 month extension to implement BIS quality control order

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Indian consumers' awareness towards brands having sustainable & ethical practices increased

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