Shopping Mall Impact on Small Bussinesses
Impact of Malls on Small Shops and Hawkers
A small sample survey of the impact of malls on small shops and hawkers in Mumbai points to a decline in sales of groceries, fruits and vegetables, processed foods, garments, shoes, electronic and electrical goods in these retail outlets, ultimately threatening 50 per cent of them with closure or a major decline in business. Only 14 per cent of the sample of small shops and hawkers has so far been able to respond to the competitive threat of the malls with the institution of fresh sales promotion initiatives.
ANURADHA KALHAN
India is attempting to do in 10 years what took 25-30 years in other major global markets. However, to-date there is very little understanding of what the impact of corporate retail will be on the so-called unorganised retail sector and the agricultural sector (the country’s two largest sources of employment). This preliminary study is aimed at investigating the impact of malls on small shops and hawkers.
O
rganised corporate retailing is poised to become the business of the decade in India. Retailing presently contributes about 10 per cent of India’s gross domestic product (GDP) and 6-7 per cent of employment. With some 15 million retail outlets, India has the highest retail density in the world. But only 4 per cent of these outlets are more than 500 sq ft in size and almost all are familyowned shops and establishments [Mukherjee and Patel 2005]. The value of organised retail is expected to grow 2.8 times in the coming four years to a Rs 1,000 billion industry, attracting many global retail chains like Wal-Mart, Tesco, and Carrefour [Outlook, October 16, 2006]. Foreign direct investment (FDI) up to 51 per cent in single brand retail was permitted last year and multi-brand retail is expected to open up to FDI soon. Meanwhile, Indian retail chains like Reliance Retail, Croma, Aditya Birla group, S Kumars, Shoppers’ Stop, Westside, Subhiksha, and Trinethra have all been consolidating their
A small sample survey of the impact of malls on small shops and hawkers in Mumbai points to a decline in sales of groceries, fruits and vegetables, processed foods, garments, shoes, electronic and electrical goods in these retail outlets, ultimately threatening 50 per cent of them with closure or a major decline in business. Only 14 per cent of the sample of small shops and hawkers has so far been able to respond to the competitive threat of the malls with the institution of fresh sales promotion initiatives.
ANURADHA KALHAN
India is attempting to do in 10 years what took 25-30 years in other major global markets. However, to-date there is very little understanding of what the impact of corporate retail will be on the so-called unorganised retail sector and the agricultural sector (the country’s two largest sources of employment). This preliminary study is aimed at investigating the impact of malls on small shops and hawkers.
O
rganised corporate retailing is poised to become the business of the decade in India. Retailing presently contributes about 10 per cent of India’s gross domestic product (GDP) and 6-7 per cent of employment. With some 15 million retail outlets, India has the highest retail density in the world. But only 4 per cent of these outlets are more than 500 sq ft in size and almost all are familyowned shops and establishments [Mukherjee and Patel 2005]. The value of organised retail is expected to grow 2.8 times in the coming four years to a Rs 1,000 billion industry, attracting many global retail chains like Wal-Mart, Tesco, and Carrefour [Outlook, October 16, 2006]. Foreign direct investment (FDI) up to 51 per cent in single brand retail was permitted last year and multi-brand retail is expected to open up to FDI soon. Meanwhile, Indian retail chains like Reliance Retail, Croma, Aditya Birla group, S Kumars, Shoppers’ Stop, Westside, Subhiksha, and Trinethra have all been consolidating their