By B.S. Nagesh

By 2010, the list of India's top 10 retailers will have at least 5 Indian corporates. Cities like Mumbai will boast high streets and stand-alone department stores in certain localities, with at least 1 or 2 malls

Retailing will go through a tremendous change in India this millennium. It will change India's cities, its people, and its households. The Indian consumer is reportedly the largest spender in Singapore and London. It is, therefore, strange that there have, so far, been few efforts to present the product in the right kind of environment in India. Indeed, the right shopping experience does induce Indian consumers to spend more. This is evident from the experiences of retail-outlets like Shoppers' Stop, Music World, Food World, Crosswords, and The Home Store.

However, the development of organised retail is dependent on the efforts of several agencies and institutions. The first among these is the government. In a country as big as and with as many states as ours, it is imperative that the Central government and all state governments bring in Value Added Taxation or a unified taxation system to ensure that the tax-regimes are the same across the country.

The laws governing retail real-estate should also be looked into so that it is possible to develop retail-estate beyond the city-limits. Apart from providing entertainment and retail opportunities, this will also decongest the city centre and facilitate the development of suburbs. The relevant rules should also be amended to allow retail-stores to operate 7 days a week, 12 hours a day. Given the hours most urban consumers keep at work, and keeping in mind the increase in the number of nuclear families, this may, indeed, make sense. This will also help people enjoy their evenings-out at malls.

The second group, whose participation is essential in making retail a boom-sector in this millennium, comprises developers. Most properties are developed without considering the end user; thus, you sometimes find high-ceilinged offices and low-ceilinged retail stores. Often, the shopper's convenience is not taken into consideration while the property is constructed.

Another area of concern is the way in which developers sell their space. The only consideration is the price, not the usage pattern or the nature of the product that is to be sold. In contrast, internationally, mall-management is treated as a specialised discipline of retail management. This is what we have to focus on in this millennium.

The third constituency that has a role to play in the fortunes of organised retail this century is the education-sector. Retail is a people-intensive business, and there is a huge opportunity for retail institutes in India.

For manufacturers, retailing will present an attractive opportunity. Organised retail allows them to expose their products to a large volume of customers in an environment conducive to buying. Already, several transnational retail giants have established their presence in India; others, notably Chinese retailers, have visited India and studied the Indian market. There's a lot at stake here: even this early in the 21st Century, India is too large a market to be ignored by transnational retail giants.

From the manufacturing company's perspective, the focus should be on producing good products, and forging relationships with organised retail. Manufacturers need to draw a plan of producing quality products and tie in with retailers. Indeed, the birth of organised retail will also engender the creation of private labels and store-brands. Thus, if a manufacturing company lacks the resources to build a brand, it can supply to a retail-chain that has the resources to create a brand of its own.

What does this millennium have in store for organised retail? A glimpse of the last 2 decades of the previous century proves illuminating. Large-format retailing started with outlets like Vivek's and Nalli's in Chennai and Kidskemp in Bangalore, and, at another level, with manufacturer-retail brands like Bata, Bombay Dyeing, and Titan. The last decade of the millennium witnessed the emergence of lifestyle brands and the plastic culture. Liberalisation, and increasing awareness of the world around us created the Indian yuppie, who aspired to own everything he saw on TV, or in shops during jaunts abroad. New lifestyle brands offered traditional retail-outlets an opportunity to convert themselves into exclusive stores, franchised or otherwise.

And even as these developments were taking place, the Indian consumer became more mature. Customer-expectations zoomed. Thus, at the beginning of the New Millennium, retailers have to deal with a customer who is extremely demanding. Not just in terms of the product-quality, but also in terms of service, and the entire shopping experience. Today, the typical customer who shops in a retail outlet compares the time spent at the check-out counter with that at an efficient petrol station, and the smile of the counter-person to that decorating the face of a Jet Airways' crew member. To cope with the new customer, manufacturers have to focus on product quality and brand-building. And retailers, in turn, have to focus on the quality of the shopping experience.

Internationally, retailing is a large business; you find at least one retailer amongst the top 10 companies in every country. In the us, it is Wal-Mart with a turnover in excess of $120 billion. In the UK, it is Marks and Spencer's with close to £10 billion; and, in Germany, it is Karstadt with a turnover in excess of dm 10 billion. Studies by consulting firms like A.T. Kearney, KSA Technopak, and McKinsey & Co. in India have indicated a huge potential for retailing in the country. Drawn by the magic number of Rs 1,60,000 crore-that is expected to be the size of the retail industry by the end of the first decade of this millennium-several companies from the organised sector have also jumped into the fray.

In the next 10 years, I expect to see a major change in the way retail will evolve. By 2010, the list of India's top 10 retailers will have at least 5 Indian corporates. Cities like Mumbai will boast high streets and stand-alone department stores in certain localities, with maybe 1 or 2 malls. Mall-development will take place in secondary cities like Jaipur, Indore and metropolitan cities with a circular topography like Chennai. Leading department stores will act as anchors in malls and food courts, and entertainment centres will be the draw.

In this millennium, like in the last, customers will want to spend time with their family and friends. They may like to visit malls on weekends where everything will be available under one roof. India will benefit from these developments because of increased consumption through retailing and the corresponding increase in employment created by retailing.

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