subject: Massive Retail Businesses - Creators of Jobs in India or Destroyers of Small Enterprises? [print this page] Massive Retail Businesses - Creators of Jobs in India or Destroyers of Small Enterprises?
India boasts of twelve million shopkeepers, though for how long it will boast of it's anyone's guess. Times are a-changing and the customers are ready to provide up the pleasure of bargaining and matching their wits with a typically-indignant-sometimes-pleading shopkeeper, in exchange of a true cut price and rock-bottom prices of quality, branded goods.
The ball started rolling the day Manmohan Singh presented the budget in 1991 that proposed widespread economic reforms. Combined with globalization, liberalization and revolution in the sector of communication these reforms paved the method for the expansion and development of massive business in India. Indian companies got the support from the govt. as the govt. banked on the private sector to form a ton of jobs in India. Personal enterprise and its energy remodeled all the main Indian industries, and retailing, with the large Indian market and virtually total absence of any organized competition, attracted huge players sort of a magnet.
Numerous huge businesses have entered the retailing field and previous few years are seen the building of lots of malls. Following the model discovered by Wal-Mart, infusing thousands of crores of rupees in the business, buying merchandise in huge quantities and cutting prices right down to a level a general kiryana shopkeeper simply can't afford, these corporations have return and conquered the market simply as they had foreseen. Homegrown companies and MNCs have entered the Indian retail market and captured a huge chunk of the retail revenues.
Consumer is the King in such an environment-he will finally get a lot of good product for low prices. Malls have arrived in massive Indian cities and have become a weekend destination for the Indian middle class. The govt. loves and politicians garner votes, pointing gleefully at the roles in India created by the malls. TATA, Reliance, RPG group, Subhiksha, Carrefour, METRO, Marks & Spencer and several others have cornered a large portion Indian retail market, while the shopkeepers are continuously losing ground.
Malls and discount rates in merchandise have created it not possible for general stores to make profit. The huge firms create jobs, but most of it is menial work. Anyone who has encountered the blank eyes of a bored salesman at a mall will imagine how unchallenging the work offered in such places is. On the opposite hand, the shopkeepers and little entrepreneurs in the retail business cannot manage to beat the powerful organizations with their wits, and several retailers are closed every day.
