A Study on the Challenges and Opportunities Faced by Organized Retail Players in Bangalore
12 Pages Posted: 19 Jul 2009 Last revised: 11 Aug 2009
Date Written: July 14, 2009
Even though Indian retailing is hailed as a huge sector in India, in reality, it is not so rosy when compared to the retail scenario in developed and other developing countries. Indian retail is still in the infancy stage, with the retail revolution gaining momentum in India only in the late 1990’s, and there are a number of challenge factors which need to be overcome and a number of opportunity factors which need to be leveraged upon, if organized retailing is to flourish the way it ideally should.
This study revolves around the opportunities and challenges faced by organized retail players in Bangalore. It was found that organized retailers see competition from the unorganized sector as their biggest challenge, followed by competition between organized retailers and the inefficiency of distribution channels, internal logistical problem and retail shrinkage, while unorganized retailers see organized retailing as their major challenge, followed by cost of operation, logistical problem, competition between other kirana retailers and inefficient distribution channels. It was also found that organized retailers see Bangalore’s growing middle class as their greatest opportunity followed by large number of earning youth customers, Bangalore having people from all over India, proportionate increase in spending with earnings and India’s booming economy, while the kirana retailers see Bangalore having people from all over India as their biggest opportunity, followed by Bangalore’s growing middle class, India’s booming economy, large number of educational institutions in Bangalore and proportionate increase in spending with earnings. Thus, the study found that the major challenges as well as opportunities of organized and unorganized retail are almost the same. This means that mitigating the challenges and leveraging on the opportunities could benefit both sectors.
Keywords: retailing, organized and unorganized retailing
JEL Classification: L81
Suggested Citation: Suggested Citation