Modern Retail Will Thrive,
But Traditional Retail Will Survive



  • Modern and traditional retail will successfully co-exist

Case-Study: Survival of small retail in Brazil Brazil is a very good case-study of survival of small retail where apprehensions were put to rest as the number of small traditional retail stores showed an increase of 27% whereas supermarket chains showed a decline of 5.7% between 1994 and 2000. Further small retailers received support from suppliers in the form of price discounts as the suppliers sought to reduce the share of the large chains to lower
their bargaining power. ‘Associativism’ was also a major area of success where small retailers centralized purchases along with a broad range of collective goods, such as: acceptance of credit cards, marketing campaigns, legal and
accounting aid, brand name, automation, training of employees, the centralization of selection and administration of human resources, standardization of store layouts and promotions as well as integration with a logistical operator for diminishing storage spaces and reducing costs of supply.

A major area of concern in India regarding growth of organized retail and entry of foreign players is that traditional retail channels such as ‘kirana’ stores will be wiped out. With Indian retail market growing from US$ 336 billion in 2006 to US$ 590 billion in 2011, even if share of modern retail grows from current level of 4% to the estimated 16% in next five years, the absolute market size of traditional retail will grow from around US$ 324 billion in 2006 to US$ 493 billion in 2011.

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This would evolve from a retail medical clinic setting (outlined in chapter 1) to a pure medical mall per se. The pace of transition would depend on the success of the retail medical malls and the growth of the healthcare market.

(Source: The Tribune)

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