Organised Retail Is Getting Back

Organised retail is getting its bearings back. The astronomical rentals are down. The frenetic increases in wages are a thing of the past. The supply chain and its evils/blessings are the focus of many retailers.

Many new entrants are close to store breakeven. The mall operators are more careful in planning and design. Most important of all, the customers have slowly and imperceptibly started realizing the value of modern retail – clean dealings, convenience and a good environment to shop. The problems of the store staff apathy remain but like in evolution, the customers have begun adapting to this.

Arvind Singhal published an interesting article two weeks back in Business Standard. The malls in Saket in South Delhi have taken away customers from South Ex and GK1-just last year amongst the priciest markets in the world. The productivity in these south Delhi traditional markets is down by close to fifty per cent. It was virtually impossible to imagine this and no retailer in his senses would have dared to predict that it will happen so soon. The malls have managed to do it with the right value proposition and delivery.

Even if things are still perceived as bad, I think twenty to thirty per cent growth for more two years in a row have also made things dramatically different.