We REGRET the chances we didn’t take, not the ones we took and failed at !

India’s retail sector is growing at a speed like never before making it the most desirable retail destination in the world.  The total consumption by consumers in India is expected to grow massively and touch USD 3600 billion by 2020 making Indian consumer economy the 5th largest in the world. It accounts for 10% of the GDP and 8% when it comes to employment.

In a space where modern trade is expanding at 15-20% YoY, retail penetration is still stuck at 8%. This brings in a huge opportunity for growth which is also attracting many foreign players to the Indian retail sector. The reason behind the enormous growth is the rising middle class segment which now enjoys higher incomes and more disposable income than before and a different mindset and lifestyle that allows them to explore premium brands and delve into experiential shopping. Other important changes that are propelling the retail sector in India are positive tax reforms, digitalization, easy availability of consumer credit, and a completely different retail culture; one in which the roadside individual shops and cinema halls have been transformed into mega malls with branded outlets, multiplexes and supermarkets, all under one roof.

As they say, growth and challenges walk hand in hand. Similarly, the retail sector in India is challenged by extremely competitive e-commerce that offer heavy discounts, high land prices and rentals, lack of skilled labour, political unrest, unfavourable policy framework, and heavy investments. The e-commerce retail industry is going to touch USD 60 billion in 2020.

Risks entail business interruption, equipment breakdown, property loss, employee retention, legal issues, professional liability, supply chain risks, worker’s compensation and price instability. Unless these risks are covered through a sound insurance plan, retailers will not prosper.