The retail industry, which suffered a 3 per cent dent after the Corona virus outbreak struck the Indian shores last year, is set to treble to Rs 140 lakh crore by the end of the decade, says an industry study.
The report from the Retailers Association of India and consultancy BCG pegs the wounded retail market at Rs 47 lakh crore and sees e-commerce as the biggest healer. “The decline would have been deeper had it not been for the kiranas and e-commerce which bounced back faster, while modern trade is now getting back to normalcy,” it says.
Traditional trade accounted for Rs 16-19 lakh crore in 2010 which, on an annual 11 per cent growth, jumped to Rs 45-46 lakh crore in 2019 and slowed down 4 per cent last year to Rs 43-44 lakh crore.
Online retailing, on the other hand, clipped from Rs 10,000 crore in 2010 to Rs 2-3 lakh crore in 2019 on the back of a massive 48 per cent annual growth and another 28 per cent growth in 2020, thanks to the pandemic containment measures.
According to another report published earlier this month by Unicommerce, a supply-chain software-as-a-service (SaaS) technology platform, and global management consulting firm Kearney, Tier-II and Tier-III cities accounted for a 90 per cent on-year incremental volume and value growth.
The Unicommerce report shows that personal care, beauty and wellness, fast-moving consumer goods (FMCG) and healthcare were the biggest beneficiaries of the e-commerce boom with volumes spurting up to 95 per cent in 2020.
The BCG study seconds the projection. It says this frenetic growth will be driven by food and beverages at 8.2 per cent, clothing and footwear at 9.1 per cent, housing and household items at 9.3 per cent, healthcare products at 9.6 per cent, transport and communication at 8.2 per cent, education at 10.3 per cent, and leisure at 9.1 per cent annually between 2019 and 2030.
“The share of consumption to GDP will rise to 62 per cent by 2030 from 60.2 per cent in 2019 and 54.8 per cent in 2010,” it says.
With the world splitting into two periods – pre-Covid and post-Covid – in the year gone by, there is a visible change in the buying preference of consumers. The studies highlight the importance for retailers to adapt to the evolving trend in the Indian retail space.
“The e-commerce industry has emerged as the backbone of the retail industry and small and big players have realised the immense potential that e-commerce holds,” a Unicommerce statement says, quoting CEO Kapil Makhija.
