The experience turn: A good news and a bad news for Indian retailers

economictimes.indiatimes.com:

consumer landscape is shifting in various ways which keeps retailers on toes. Recently released Household Consumption Expenditure Survey data showed Indians are spending less on food, particularly staples like rice and wheat, and more on discretionary items such as processed food, as well as durables like televisions and fridges. Already a premiumisation trend is sweeping across categories for the past few years.

Charting out shifts in India's retail sector, a joint study by Boston Consulting Group (BCG) and Retailers Association of India (RAI) brings good news as well as bad news for Indian retailers. The good news is Indian retailers have a vast business growth opportunity to capture. India continues to be a bright spot among top global economies with a robust GDP growth of 7% in 2023. It is projected to overtake Germany & Japan to claim the 3rd spot by 2030. Private consumption at the same time remains strong. India retail is expected to reach $2 trillion in the next 10 years and presents a large opportunity for retailers, says the report titled 'Unlocking the $2Tn retail opportunity in the next decade'.

As retail is going through key shifts, the pace of growth is influenced by several factors such as steady growth in disposable incomes, return of store expansion, momentum through small formats, increase in affluence impacting categories differentially, varied mix of volume and average selling price, steady increase in urbanization and relatively slower growth for e-commerce versus recent past. One worrying