A Comparative Study of Consumers Prefernce for Big Retailers Against Small Departmental Stores

Topics: Retailing, Shopping mall, Shopping Pages: 8 (2381 words) Published: March 30, 2013






“Unorganized retailing” is defined as an outlet run locally by the owner or caretaker of a shop that lacks technical and accounting standardization. The supply chain and sourcing are also done locally to meet local needs. Its organized counterpart may not obtain its supplies from local sources. Indian retail is dominated by a large number of small retailers consisting of the local kiryana shops, owner-manned general stores, chemists, footwear shops, apparel shops, paan and beedi shops, hand-cart hawkers, pavement vendors, etc. which together make up the so-called “unorganized retail” or “traditional retail”.

“Organized retail” is nothing but a retail place where all the items are segregated and brought under one roof, unlike the unorganized retail where there are different things are sold in different shops. It also aims to bring maximum of different brands making the same type of product together. In India there has been a huge growth in organized retail since 2002-03 and this is associated with the growth in the economy and the attendant rise in consumption spending.

The last 3-4 years have witnessed the entry of a number of organized retailers opening stores in various modern formats in metros and other important cities. Organized retailing has begun to tap the enormous market but its share indeed is small. A number of large business houses have entered the retail business with very ambitious expansion plans. Big foreign retailers are also keen to invest in India but their entry depends on changes in the government’s FDI policy regarding retailing. Organized retailing played a significant role in the present-day developed countries during their period of high growth. Since the early 1990s, it is also contributing substantially to the growth of developing countries. In India, organized retail is poised to make a mark in the near future.

Modern retail sector is at the crossroads where the growth of organized retailing and growth in the consumption by the Indian population is going to take a higher growth trajectory. It is undergoing a major transformation as entry of global players and watchful expansion by major Indian retailers has opened new vistas of joint ventures, tie-ups and franchise offering new formats, services, private labels, locations and recently to diverge from metros to smaller towns, Arvind Singhal Chairman Techno pak Advisors has rightly said that, “A lot of international retailers and brands are most likely to look at India, as global markets have stabilized and the Indian economy has proved to be better than most other countries”. With the changing retail scenario the consumers are bound to look beyond traditional retail stores towards organized outlets may be with some reservations. This necessitates study of the factors which influence the consumers to move towards the organized retailing from unorganized one besides most prioritized attributes which attract the consumers towards either of them.

Retailing in India is one of the pillars of its economy and accounts for 14 to 15% of its GDP. The Indian retail market is estimated to be US$ 450 billion and one of the top five retail markets in the world by economic value. India is one of the fastest growing retail markets in the world, with 1.2 billion people. India's retailing industry is essentially owner manned small shops. In 2010, larger format convenience stores and supermarkets accounted for about 4% of the industry, and these were present only in large urban centers. India's retail and logistics industry employs about 40 million Indians...
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