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Shopkeepers are already feeling the heat

P. Manoj

STORES OF THE FUTURE: Malls have become one-stop shops for consumer goods. — Photo: K. Murali Kumar

Bangalore: It is called the Great Indian Retail Show. But, the "malling" of India could well end in the "mauling" of local grocery or kirana (provision) stores.

The mushrooming of big retail bazaars or malls in the country will take its toll on the neighbourhood kirana store or baniye ki dukaan (local traders), say industry watchers. Traders say that kirana stores are already feeling the heat with the arrival of malls in their immediate vicinity and registering lower sales and revenues.

"Big supermarkets on residential high streets will replace the local kirana stores," says Darshan Mehta, President, Arvind Brands Ltd., a Lalbhai Group entity with a number of apparel brands under its wing. Mr. Mehta's statement points in the direction that India's retail sector is headed in. Hypermarkets or large multi-divisional layouts with a warehouse-like appearance and generally located in remote parts of the city will be another format for future stores, he explains.

E-tailing or people buying products on the net is "clearly another trend to watch out for in the future." Of its total sales, global fashion house GAP sells products worth a shade less than $1 billion on the net alone. "E-tailing is at an inflation point in the country," notes Mr. Mehta.

FDI in retail sector

The transformation of the Indian retail sector, valued at Rs. 9 lakh crores, from the local grocery stores to malls or hypermarkets, is likely to have a telling affect on the 1.4 billion shopkeepers in the country, say traders.

This is also expected to sharpen the debate on allowing foreign direct investment (FDI) in India's retail sector. The Communist Party of India (Marxist), a key supporter of the Congress-led United Progressive Alliance Government at the Centre, has already raised concerns on the GOvernment's controversial move.

CPI(M) General Secretary Prakash Karat says that the party's concerns on FDI in retail trade are not just preconceived ideological positions. "We think FDI in retail trade will displace employment," Mr. Karat said recently.

But, senior Ministers holding key economic portfolios in the Manmohan Singh Government disagree with this view and are pushing for the opening up of the retail sector to foreign funds.

Mr. Mehta, whose brands are sold in a number of malls across the country, demolishes the myth that malls are frequented only by the rich and famous. "It is the average middle class that goes to malls, not just the upper class or the affluent," he says.

All-in-one stores

With everything from groceries and vegetables to footwear, clothes, cosmetics, furnishings and electrical items available under one roof, a growing middle class with higher disposable incomes is heading for the malls in droves.

For some, it is a way to chill out on movies and food in the added comfort of a fully air-conditioned space. "In short, it is a living room for most of them," says Mr. Mehta.

According to estimates, the number of malls in India is expected to increase from 59 to a staggering 358. Spread over 87 million sq. ft, these malls are expected to be the next big money spinners by 2007.

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