This is the project that I made as seminar project report during my Post graduation in MBA from Central University of Rajasthan

1. A
Seminar Report
On
FUTURE OF RETAIL: Omni-channel
Submitted in the partial fulfillment of the requirement for the degree of
Master of Business Administration
CENTRAL UNIVERSITY OF RAJASTHAN
NH-8, Bandarsindri, Tehsil Kishangarh, Ajmer
Rajasthan 305817
Session- 2021-2023
Guided By:
Prof. Dr. Tulsee Giri Goswami
Submitted By:
Sunayana Shakya
Enroll. No.: 2021MBA025
Department: MBA 1ST
Year

2. DECLARATION
I hereby declare that the project report entitled “FUTURE OF RETAIL: OMNI-
CHANNEL” submitted by me to Central University of Rajasthan (CURAJ),
Ajmer in partial fulfillment of the requirement for the award of the degree of
MASTERS OF BUSINESS ADMINISTRATION is a record of bona fide project
work carried out by me under the guidance of Dr. Tulsee Giri Goswami.
I further declare that the work reported in this project has not been submitted and will
not be submitted, either in part or full, for the award of any other degree or diploma in
this university or any university.
Date: Name: Sunayana Shakya
Place: Ajmer Signature:
Enroll. No.: 2021MBA025

3. ABSTRACT
There was a time when people used to exchange things in exchange for things, where
money was not a concept of the time. People used to exchange things based on the
need and value of the items being exchanged. The days of Barter System were soon
shadowed by the introduction of money, a common mode of exchange for all sorts of
goods. Then came merchants who would deal in all such kinds of trades. Shops,
mandis, vendors emerged in the scenario. It is hard to imagine now that it was just a
few decades ago that the word “retail” was a thing of future. And look at where we
stand today. Shopping for everything we need by simply laying down on our beds,
with a simple click on a device. Retail has come a long way since its introduction in
the 19th
Century. In fact, it won’t be wrong to say that we are currently living in the
time when a retail revolution is happening. Let us see what the future has in store for
the retail sector, which accounts for 10 percent of the GDP of the country. In this
project we will be looking at how the behaviour of the customer is changing in
today’s retail environment and how that is going to influence the face of retail in the
future. I have done a research on a group of Individuals studying what their buying
pattern is and what influences their buying behaviour while purchasing.

4. ACKNOWLEDGEMENT
I would like to express my sincere gratitude to my seminar guide Dr. Tulsee Giri
Goswami Lecturer, Department of Management for her valuable guidance and
encouragement which has been absolutely helpful in successful completion of this
seminar report.
I am intended to Prof. Uma Shankar Mishra, Professor and Head of Department for
his valuable support.
I am also grateful to my parents and friends for their timely aid without which I
wouldn’t have finished my seminar successfully; I extended my thanks to all my well-
wishers and all those who have contributed directly and indirectly for the completion
of this work.
And at last but not the least; I thank God Almighty for his blessings without which the
completion of this seminar would not have been possible.
Thanking You
Regards,
Sunayana Shakya

5. TABLE OF CONTENTS
S. No. Content Page No.
1. Introduction 1
2. Literature Review 6
3. Research Methodology 9
4. Survey 19
5. Conclusion 23
6. References 26
LIST OF FIGURES
S. No. Figure Page No.
1. Retail Chronology 4
2. Market size Graph 10
3. Market Share 11
4. Organized retail market share chart 13
5. Customer Buying preference graph 20
6. Online vs. Offline 21
7 Payment Preferences 22

6. LIST OF APPENDICES
1. Questionnaire
LIST OF SYMBOLS, ABBREVIATIONS OR NOMENCLATURE
1. $ -Dollar
2. ₹-Rupees
3. RAI- Retailer Association of India
4. FDI- Foreign Direct Investment
5. GDP- Gross Domestic Product
6. CAGR- Compound Annual Growth Rate
7. RBI- Reserve Bank of India
8. MSME- Micro, Small & Medium Enterprise
9. CPI- Consumer Price Index
10.NASSCOM- National Association of Software and Service
Companies
11.OTT- Over the Top
12.MSMEs- Micro, Small & Medium Enterprises

7. 1
Chapter 1
INTRODUCTION
The retail industry has emerged as one of the fastest emerging sectors not just in India
but at a global context. It accounts for 10% of the country’s GDP as well as 8% of
total employment in the country. The Indian retail industry has become the fifth
largest in the global retail space. In FDI Confidence Index, India ranked 16 (after big
names like the US, Canada, Germany, United Kingdom, China, Japan, France,
Australia, Switzerland, and Italy). This could be possible due to the rising income and
changes in the lifestyle by the middle earning group. The one major factor is going to
be the online retail market which is increasing with a whopping 31% year on year. But
with this increase in the online retail market, there has been a constant fear among the
Physical store retailers that their businesses would be lost in the future. The quote
“Online v/s Offline” has already made headlines in various news and magazines.
However, it would be a premature assumption to say so considering the size of the
retail market that is covered by them. Especially when we look at it, the unorganized
retail sector still consists of 90% which is still quite difficult to tap even for the big
Multinationals. So, it would be quite interesting to understand the future of retail in
India. But to understand the future, we must first understand what retail is and how
the market is changing.
RETAIL: OVERVIEW
Retail, in simple terms, means selling or provision of a product or service to the end
consumer for its consumption or utilization and not for further sale. So, Retail
includes:
1. A seller or producer
2. A product or service
3. A buyer or consumer
However, retail is a much wider concept than mere selling and buying of products. It
involves all the means which lead to selling of the final product. Today, retail has
become a separate field of knowledge and study. It involves producers, sellers,
suppliers, middlemen, advertisers, buyers, influencers, risk bearers, shopkeepers,
online sellers, and so much more.

8. 2
TYPES OF RETAIL SECTOR
Retail Industry is classified into two categories which are Organized and Unorganized
retail.
1. Organized Retail: Organized retail industry is the one in which retailers are
licensed for trading activities and are registered for organized retailing.
Organized retail industry includes items like shopping, food, entertainment all
under one roof. It is also known as Modern Retailing as it includes multi-store
malls, shopping malls, , supermarkets which offers large variety of products,
different types of products, same products with different brands in terms of
quality, price and memorable shopping experience. The share of the organized
retail market in India has increased from about 12% in 2017 to 22-25% in
2021, which was partly driven by the growth of e-commerce market from US$
24 billion in 2017 to US$ 84 billion in 2021, as per the Retailers Association
of India.
2. Unorganized Retail: : It refers to unauthorized small shops .It includes kirana
stores, general stores and other small retail stores. Unorganized retail sector
also known as traditional retailing. It is limited to local or regional place but
they are highly competitive outlets. These types of a retailers generally do not
pay taxes and most of them are not even registered for sales tax or income tax.
This type of a retail outlets are small and easy to run and it required minimum
investments in terms of place, labour and capital. Unorganized retail sector has
a narrow range of products and the pricing of product depends upon the
relationship and decided by seeing the face of the customer. Even though in
many developing countries, unorganized retail outlets has major share of the
retailing business. According to the report published by Statista research
department, even Indian retail industry was dominated by the unorganized
sector at 88% in 2019. By 2021 however, this share was estimated to reduce to
75% with a greater share of organized retail and an increase in online retail.

9. 3
EVOLUTION OF RETAIL IN INDIA
Barter system is one of the oldest ways of doing business in India. Then came Haats,
Mandis and Melas in the medieval period. What was supposed to be an exchange of needs
started to change into a settled way of business?
• The 1970s saw the emergence of retail through the textile sector. Textile industry
in India started the first revolution of changes in the 20th
Century. Textile shops
started settling down in the neighborhoods.
• The 1980s saw the emergence of Brands. Thanks to Bollywood, this motivated the
common public to look more like the hero they saw in their favorite movie and
thus the brands gained a lot throughout this period.
• In 1991, the Globalization happened to save the depressed economy to recover at
that time. Retail sector was among the sectors who gained the most from it as
foreign brands started their businesses here in India. The economic reforms
changed the retail scenery completely.
• It was after the introduction of these reforms that we started seeing big business
investments in single retails. Multiple formats and products categorization started
happening in the retail scenario. The big malls that we see today started emerging
in the later years of the 1990s.
• In the early 2000s these multiple formats started expanding further and high street
shopping centers started emerging in the retail scenario.
• In 2006, the government allowed 51 percent foreign investments in a single brand
retail firm meaning a foreign company be the major stakeholder in a retail firm
thus the retail industry having far more influence from the western culture than
earlier. In 2011, they did the same for multi-brand retail as well and increased the
FDI for a single brand store to 10 percent.
• In 2013, Amazon looked at this as an opportunity and established itself as an
online retailer. The boom of smartphones and with the increasing internet
penetration, they became the single biggest online retailer in the country. Since
then, the retail industry has grown significantly, thanks to cheap internet.
• The pandemic in 2019 affected the offline retail scenario completely. It changed
the face of the retail market in India completely. Now we stand at the verge of
another revolution in retail.

10. 4
Figure 1
CURRENT RETAIL FORMATS IN INDIA
In India there are various kinds of retail formats-
1. Supermarkets/ Hypermarkets: One of the most popular retail formats in
India is the supermarkets. Supermarkets are self- service shops that offers a
wide variety of food, beverages and household products. Similar to
supermarkets, hypermarkets in India is a combination of supermarket and
departmental store. It provides all kind of groceries and general goods.
Reliance, Spencer Easy day and Big Bazaar are some of the major players
present in the market.
2. Shopping Malls: Shopping malls is one of the most popular and most visited
retail formats in India. Shopping malls are modern form of shopping. It is a
large retail complex containing a variety of stores like clothing, accessories,
gaming zone, food court and so on under one roof.
Earlier, Haats and
Melas, typical
Indian markets,
were formend
In 1970s, First
emergence of
organized retail
through textile
sector
In 1980s,
Emergence of
brands and
branded retail
outlets
In 1991, India
opens doors
through economic
reforms
In 1990-95,
Multiple formats
and product
categories
introduced
In 1995-99,
Modern malls are
introduced
In 2000-05, Rapid
expansion of
multiple format
Indian companies
begins
In 2005, High
street shopping
centers begin to
appear
In 2006, Govt.
allows up to 51%
FDI in a single-
brand retail firm
In 2005-10, Rapid
modern malls and
single-branded
store expansion
In 2011, Govt.
allow 51% FDI in
multi-brand retail
and 100% FDI in
single-brand retail
In 2013, Online
retail boom and
Amazon's entry in
India
In 2016, Internet
Penetration
In 2019, Covid
pandemic spread
worldwide
Now
A new way of
reatail

11. 5
3. Mom and Pop stores: In India, this type of store is known as Kirana store.
This type of store is generally a family-owned business selling variety of
products with limited quantity. It is small, independent and controlled by
family with limited number of employees. These stores are known for their
high standards of customer service.
4. Convenience store: It is a small retail outlet that offers products of everyday
life. As the name suggest convenience so this type of stores is available at the
easily accessible store locations and due to small size and limited range of
products the price of the products can be high.
5. Discount stores: Discount store are a type of store that sold products at lower
prices than the actual market price. These types of stores sell their goods at a
reduced rate to attract bargain shoppers.
6. Specialty stores: It is also known as Category Killers. These types of stores
are specialized in their field and offer one particular type or category of
products like- Pantaloons, Bata, Adidas, Raymond are some of the examples
of specialty stores.
7. Warehouse Stores: In these types of stores products are sold in bulk at a low
price. Generally, the wholesaler and retailers buy products from these types of
stores. these stores do not care much about their interiors and the products are
not even displayed and arranged properly.

12. 6
Chapter 2
LITERATURE REVIEW
Various Researches has been done by so many researchers on the Indian Retail
Industry and some of their key findings are listed below:
Sunil Chopra, (In 2015) How Omni-channel can be the future of retailing
In his research he explained what could be the structure needs to be created for selling
of products and services that is both effective and responsive to customer needs. He
came with the idea of omni-channel as a future. He explained in his research about the
strengths of both the channels i.e., offline channel and online channel and using both
the channels simultaneously.
The physical outlets /channel is used to serve frequent and predictable needs and the
online channel should be to provide 24x7 availability and offers variety at one place.
Both channels used to provide better customer experience.
Aneesh Reddy, (April, 14, 2020) Covid-19 impact: Consumers move towards
digital
In his research he explained how the Covid-19 affects the people from the way they
worked to the way they communicate and shop. In Covid-19 situation people usually
go out from their houses just to buy essential goods because people afraid that what if
they got infected. In his research he explained that due to cheaper internet availability
and continuously increasing consumer wealth, E-commerce market reached US$ 200
billion by 2026. These are the projections that have been made before covid-19, but
during Covid-19 situation people use online platform more than it is expected, that e-
commerce industry reached US$ 200 billion during the pandemic only.
Supriya Udaykumar Mogale, Dr. C. S. Dalvi (March 2019) Study on Retailing in
India: Growth and Challenges – According to their study, retail is the one of the
major pillars of the economy from the past few years. All this happen due to the
continuously increase in the income level of the consumer, changing in the lifestyle of
the middle class, increase in the digital connectivity and the cheaper availability of the
internet facility these all are the factors that contributes the growth of Indian Retail
sector. She also explained in her research that even having so many big players in

13. 7
this field but only a few can manage to survive in the field and the main reason behind
that is customer. Customer preferences are changed from past few years’ customers
are now very much aware about getting some products, brands or services provided
by the companies.
Customers now becoming more conscious and specific about getting proper customer
services and their expectations are increasing day-by-day. So, it is very much
important to identify what they actually want or what they actually expect. So,
retailers how to find out what the customer really want and meet their expectations by
providing goods and services that satisfy them the most.
Deloitte Report, (Dec7, 2021): Retail sector will be defined by multiple channel
approach
According to the report, “The future of the retail sector will be defined by a multi-
channel approach where online and offline channels will not only compete, but also
support each other. The way forward for retail will be a blend of brick-and-mortar
stores with online selling platforms, with both likely to continue to grow in markets
like India. Brands and retailers are recognizing the transition and their strategies are
being re-oriented to reflect this change.”
Future Shopper Report 2021, 72% Indians scared to shop offline: According to
‘Future Shopper Report 2021’ by global communications firm Wunderman
Thompson Commerce, During the Covid-19, as compared to the world, Indian people
fear more to shop offline and prefer online platform. Consumers as a whole wants and
integrated platform i.e. online + offline from their brands and retailers, so that they
can get the benefit of both the platform. While 86% of Indian shoppers think that
retailers need to get better at giving them, products, services and experience that they
want from online shopping, 67% of Indian consumers refuse to shop with anyone who
does not meet their demands.
Deloitte Survey, (Dec8, 2021): Over 90% consumers are looking to digitally
enhance their shopping
According to survey, the digital transformation has changed how the people shop and
the consumer behavior of seeking convenience in online shopping and covid-19 also
the biggest highlights of the “new retail” scenario. Almost 90% of consumers are

14. 8
looking for a digitally enhance shopping experience, whether engaging at home, via
mobile or inside a physical store, while 78% value convenience and the percentage
also increased due to Covid-19.
Due to pandemic consumer become more and more specific while buying a particular
product. He used to buy things according to their convenience, As the buying
behavior of consumer changes due to the pandemic so with the change in the selling
pattern of the retailers. They also adapted this ‘new normal’ and come up with their
new business models and technology.

15. 9
Chapter 3
RESEARCH METHODOLOGY
Objectives of the Study:
1. To study the Current Scenario of Retail sector in India
2. To study the Organized and Unorganized Retail Sector in India
3. To study the Segmentation of Organized Retail Sector
4. To study the factors affecting the Growth of Indian retail industry
5. To study the Offline and Online Retail in India
6. To study the Future of Retail in India
Research Design & Source of Data
The research design is descriptive in nature. Secondary data sources have been used
efficiently and effectively. This research is based on the study of secondary data
available on Indian Retail Sector. To understand and conclude the major factors that
contributes in the growth of Indian retail sectors and how the future of retail in India.
I have gone through a number of reports and papers and a small survey on the
preference of online and offline channel to understand the consumer’s preferences of
choosing one particular channel or both channels and to conclude what could be the
retail in future by using both the channels simultaneously.
INDIAN RETAIL SECTOR: CURRENT SCENARIO
Indian Retail Sector is the fifth largest in the world and it is one of the fastest growing
sectors in India. Not only this, it the 2nd
largest source of employment after
agriculture. Indian Retail Sector is projected to reach US$ 1.3 trillion (98.3 lakh crore)
by 2025-26. Retail sector is experiencing exponential growth with retail development,
not only in major cities and metros, but also in tier II and tier III cities. Retailing in
India has several outstanding achievements as well as impressive growth during the
last few decades and it is one of the pillars of its economy.

16. 10
Market size over the past few years (US$ billion)
2000
1800
1600
1400
1200
1000
800
600
400
200
0
*CAGR 21% 1750
1200
950
641 672
2016 2017 2018 2021 2026F
Market Size
India’s retail industry rank 5th
in the world in terms of size, which accounts for 10%
of the India’s GDP and contributes 8% to the overall employment in the country. The
market size of industry was approximately US$ 0.79 trillion in 2017 and was
estimated to reach US$ 1.75 trillion by 2026, growing at a CARG of 9%-11%.
Figure 2
ORGANIZED VS UNORGANIZED RETAIL SECTOR IN INDIA
Almost all industries across the world, including real estate, have been impacted by
the spread of covid-19 pandemic. However, with the ease in lockdown restrictions,
some sectors are not only showing signs of revival but have also started doing well
than most others. Organized retail is one of them. Industry source says, in times of
Covid-19, organized retail and e-commerce are on an upswing. According to IBEF,
the share of organized retail in India is likely to double to 18% in 2021 from 9% in
2017. Likewise, e-commerce is expected to double to 7% from the previous 3% in the
same period. It is estimated to cross US$ 200 billion mark by 2027 compared to US$
24 billion in 2017.
According to Stastista Report, nearly 88% of the market is unorganized while the
remaining 12% comprises of both organized and e-commerce in 2019. By 2021
however, this share was estimated to reduce to 75% with the greater share of
organized retail and an increase in online retail after pandemic.

17. 11
Figure 3
SEGMENTATION OF ORGANIZED RETAIL SECTOR IN INDIA
Indian Retail industry is broadly divided into 5 categories i.e. Food and Grocery retail,
Apparel, Beauty and wellness, Consumer durables, furniture & furnishings and others.
1. Food and Grocery retail: The food market in India is largely unorganized.
The expenditure on food products by Indian households is the 3rd
highest in
the world. It is the largest segment in the Indian retail sector; having an
opportunity worth US$ 570 billion and accounting for 66% of the country’s
total spend. Several large companies including Reliance-backed JioMart,
Amazon and Tata group are gearing up to draw a bigger share of the country’s
organized food and grocery retail market. In October 2021, Reliance Retail
introduced Freshpik, a new experimental gourmet food store in India, to
expand its grocery segment in the ultra-premium category.
2. Apparel: India is the world’s 2nd
largest exporter of textiles and clothing. As
with the Increase in the penetration of organized retail, favorable
demographics, and rising income level the demand for the textile also
increases. India’s textile and apparel exports to the United States, its single
largest market, were up 55% in the first seven months of 2021.
The share of the India’s textiles and apparel exports in mercantile shipments
was 11% in 2019-20. Rising Government focus and favorable policies is
leading to growth in the textiles and clothing industry. The Ministry of
Market Share in 2019
3%
Market Share in 2021
9% 7%
18%
88% 75%
Organized Unorganized E-commerce
Organized Unorganized E-commerce

18. 12
Textiles is encouraging investment through increasing focus on schemes such
as Technology Up-gradation Fund Scheme (TUFS). The govt. allocates funds
worth ₹17,822 crore (US$ 2.38 billion) between FY16-FY22 for the
“Amended Technology Fund Scheme” to boost the Indian textile industry and
enable the ease of doing business.
3. Beauty and Wellness: With the rise in awareness about holistic wellbeing
among people of India, the spending on beauty and wellness products and
services has increased. Covid-19 has shaped the wellness business in a much
better way. A study conducted by McKinsey & Company found that the
wellness industry is currently valued at $1.5 trillion globally. After Covid-19
pandemic India is expected to become wellness hub in the global community
following a 12% growth per annum. The Make in India initiative is expected
to bring in more investments and opportunities in this sector.
4. Consumer Durables: India’s consumer durables industry is set to touch $34
billion in market size by 2025, with the country’s smaller cities accounting for
68% of the incremental sales, according to a report by RedSeer Consulting. A
majority of the sales will come from general trade. Currently, general trade
accounts for 69% of the current market share by channel when it comes to the
sale of electronics. Despite the growth in online channels, general trade will
remain the biggest channel within durables- and will continue to remain so by
2025 as well. It is now becoming common to see retails shops having QR
codes and card machines at the point of sale. Retailers are also open to
expanding their online presence for driving sales, “according to the findings of
the report.”
5. Furniture & Furnishings: The Indian furniture market is popular in the
nation and internationally because of its rich handicraft and attractive
traditional art and design. The Indian furniture market has evolved over time.
It has broadened its market from chair and table to designed interiors like
wardrobe or sofas.
These days’ customers also have the convenience to order furniture both
online and offline- increase in digitization and flexibility of home delivery
with customization option surging the online Indian furniture market. Peppery
fry, Urban Ladder and some other companies are major players in the online
platform. At the same time, surging trends of online shopping, traditional

19. 13
furniture manufacturers like Godrej, Nilkamal and some other players also sell
their products through online medium. The furniture market has witnessed
tremendous growth in online order due to pandemic and lockdown. Indian
Furniture market was US$ 17.77 billion in 2020 and will rise to US$ 37.72
billion by the end of the year 2026, growing at a double digit CAGR of
13.37% during 2020-2026.
6. Others: It includes all the other sectors like, jewelry & accessories, leisure
and entertainment, food service, etc. India ranks 1st
among the top exporters in
cut & polished diamonds, and rank 2nd
in gold jewelry, silver jewelry and lab-
grown diamond. Food Services also increased due to pandemic in India.
People prefer to order online rather than going out in order to avoid physical
contact. Online entertainment (OTT platform) increased due to closure of
Cinema halls during pandemic.
Figure 4
8. E-tailing: In simple terms, online shopping. Customers can shop from
anywhere just with the help of smartphone or other gadgets like laptop, PC.
They can place their order through internet, pay with the help of debit and
credit cards and the products are delivered at their homes or wherever they
want. Examples are E-bay, Flipkart and Amazon.
9. Dollars stores: This type of retail outlet offers selected products with
extremely low prices but here the prices are fixed. For example- 99 store
would offer all its products at ₹ 99 only.
% share of organized retail market
1.2
2.7 4.3
3.6
5.2
8
8.7
66.3
Source: Deloitte & Retailers Association of India 2020
Food & Grocery
Apparel
Jewellery
Consumer Durables & IT
Furniture & furnishing
Pharmacy
Footwear
Others

20. 14
FACTORS AFFECTING THE GROWTH OF INDIAN RETAIL
SECTOR
1. Fast-Growing Population: India rank 2nd
with 17% of total population in the
world (estimated 1.35 billion for 2019) after China. It is projected that it will
overtake China in the next 40 years.
2. Young population: Where the other country like China is struggling with the
effects of aging population, 47% of the population of India is under the age of
25. The New York Times reports, India’s youth were eager to embrace
western brands like Benetton’s tee-shirts, Domino’s pizza, and Cadbury’s milk
chocolates, as well as the shopping experience offered by American-style
malls.
Young consumers are more driven to fashion, food and beverage, quick
service restaurants, and mobile phones. These consumers are willing to
experiment and adopt new brands.
3. Growing Income: Even though they, along with the income of the common
Indian household was affected by the pandemic. India has been recovering at a
healthy rate quarterly.
4. Digitization: Digitization is one of the major factors to contribute in the
growth of Indian Retail Sector. Due to cheaper availability of internet and
Today we have 1.18 billion mobile connections, 700 million Internet users,
and 600 million smartphones, which are increasing 25 million quarterly.
Moreover, India ranked first in the world in data consumption which is about
12 GB per person a month.
5. Government Initiatives: The government of India has taken various
initiatives to improve the retail industry in India. Some of them are listed
below:
• To support Digital India campaign and to increase the digital payments in
India, the RBI announced plans and new frameworks for the retail digital
payments in offline mode in October 2021.
• Andhra Pradesh govt. also announced retail parks policy 2021-26 in July
2021, for anticipating targeted retail investment of ₹5,000 crore. In the
next five years.
• Foreign retailers and E-commerce companies are ready to sell made in

21. 15
India consumer products for that govt. may change the rules of FDI in food
processing.
• To provide clarity to the companies operating E-commerce business in
India for that Indian govt, provides 100% FDI in online retail of goods and
services.
• The government’s focus to improve digital infrastructure in Tier 2 and Tier
3 markets would be favorable to the sector.
• The Minister of MSME announced inclusion of retail and wholesale trades
as MSMEs. Retail and wholesale trade will now get the benefit of priority
sector lending under the RBI guidelines.
Various reports published by many organizations on Indian retail industry with
different focuses; some of their key findings have been highlighted down here that
shows the growth in Indian Retail Sector.
• According to McKinsey’s consumer pulse survey, 94% of Indian consumers have
tried a new shopping behavior since Covid-19 and most intend to continue with it.
Some are exploring new digital shopping methods or different retailers/brands/
websites, while others are experimenting with private labels/ store brands. These
behavioral changes are impacting customer loyalty, making it imperative for
retailers to rethink customer retention strategies.
• According to data released by the Ministry of Statistics & Program
Implementation (MoSPI), India’s Consumer Price Index (CPI) based retail
inflation increased to 6.30% in May 2021, up from 4.2% in April 2021 as both
food and fuel inflation outpaced expectations. However, the retail inflation eased
to 5.3% in August 2021.
• According to the Retailers Association of India (RAI), the retail industry achieved
96% of pre-COVID-19 sales in September 2021, and continuously increasing by
the rising demand from consumer.
• According to the Ground Zero Series findings of the consulting firm RedSeer, the
retail sector is expected to recover ~80% of pre-Covid revenue (amounting to US$
780 billion) by end-2020.

22. 16
OFFLINE RETAIL- BRICK AND MORTAR
Brick and Mortar in simple terms, any physical store that sells goods and services
directly to customers. Kirana store, Coffee shops, bank branches, grocery stores and
clothing outlets at the malls are all examples of brick-and-mortar stores. It is the
traditional way of buying and selling of goods. When it comes to the customer
relationship, brick-and-mortar outlets still do better than e-commerce. But from the
past few years brick-and-mortar stores faces so many challenges due to the increase in
the online purchases and the Covid-19 pandemic. While retailers are trying to stay
afloat during the crises, the store restrictions, early closures, strict curbs and weekend
lockdowns have affected them even more adversely. The Indian retail sector has
witnessed some of the drastic changes of the decade just in last two years.
Due to pandemic the consumer behaviour affects deeply, almost 76% of the people
prefer E-commerce platform during this pandemic. India having around 624 million
internet users, saw a steep spike in the adoption of online shopping apps since the
lockdown in 2020.
The change in customer preferences, e-commerce boom and the pandemic has
propelled the migration of brick-and-mortar stores to start their online journey more
than ever since digitization is accelerating rapidly. Even having so many benefits of
online store still almost more than 80% of the retail done physically. People want to
shop offline because of the most important reason is customer experience, people
want to experience the product while buying. So, seeing this many online companies
are come up with their physical existence too. Major Online player Amazon.in, which
completed 8 years in India in 2021, launched its first brick-and-mortar resource
Centre called “Digital Kendra” to help MSMEs to come online.
ONLINE RETAIL IN INDIA- CLICK AND MORTAR
From the past few years, E-commerce has transformed the way people shop in India.
This sector is still booming with the increase in the internet and smartphone
penetration, a rise in digital literacy, the government’s digital push and most
important factor that affect online retail favorably is the pandemic. The market size
of the online retail industry in India amounted to approximately USD 60 billion. It
showed an increasing trend since 2015. The online retail industry was forecasted to

23. 17
reach US$ 73 billion by 2022. The pandemic has accelerated the shift towards online
shopping and the emergence of new variants of the virus will further push people
towards shopping online to avoid physical contact Ravi Sharma, banking and
payments lead analyst at Global Data, also said that during Covid-19, in most of the
market in India, transitions done through digital payments. He also added that
ecommerce payments in India are expected to rise at a compound annual growth rate
(CAGR) of 18.2% between 2021 and 2025 to hit US$ 120.3 billion. According to the
Global Data (a data and analytics co.) the Indian e-commerce market is expected to
grow 21.5% and hit US$ 74.8 billion in 2022. After China and US, India had the
third-largest online shopper base of 140 million in 2020.Not only this but According
to NASSCOM, despite Covid-19 challenges / disruptions, India’s e-commerce market
continuous to grow at 5% with expected sales of US$ 56.6 billion in 2021.
Even after with so much growth of e-commerce market in India, still physical
presence of store is a choice of Indian market customers. So many major players of
online market are come up with their physical presence in order to provide great
customer experience. Various major online companies are come up with their physical
presence; some of them are listed below:
• Nykaa (online beauty care & Cosmetics Co.) plans, to more than triple its brick-
and-mortar stores to 300 to significantly increase its offline presence in India.
• Tata-owned 1mg & PharmEasy two of India’s biggest online pharmacies are
going offline, as they look to have an omni-channel presence to widen their user
base.
• Tata-owned e-grocer BigBasket, which opened its first physical store under the
brand name: Fresho in Bengaluru said it plans to open 200 physical outlets across
the country by fiscal year 2023. The Bengaluru-based online grocer aims to
increase that number to 800 stores by 2026.
• EV (Electronic Vehicle) platform BLive also announced its foray into offline
multi-brand retail segment with the launch of a facility in Hyderabad. They also
came up with 100 more physical retail stores in the next 3 years. The main aim of
this company is to offer its customers an interactive experience by showcasing e-
two wheelers and e-bikes manufactured by Indian brands. Earlier the platform was
offering these services only online. In 2020, the company launched the country's
first online EV marketplace, offering e-cycles and e-scooters from top EV brands.

24. 18
FUTURE OF RETAIL
Hybrid Model – Omni-Channel Retail
When the pandemic hit the world, every sector of industries was hit. But the one
sector that was impacted the most was, in fact, the offline retail sector. Contactless
shopping has become a generally accepted term in today’s public. People avoid going
to shops, or malls or any crowded place as such, because of the fear of catching the
virus. The government regulations have made it mandatory to maintain only a certain
limit of the total capacity to be filled even in the service sector of retail like Cinema
halls and adventure parks.
When the first wave of the pandemic hit the world, at first, the businesses that were
purely offline had to be shut down completely. This meant that there would be no way
of earning for them. And this gave an edge to the online channels significantly.
However, after the ease of the restrictions, the businesses learnt that having only an
offline significance in the current day is not fruitful. So, lots of them looked for the
opportunity of creating an online significance as well, where the customers can order
online, be it through Whatsapp, Facebook, an app, a website of the store or simply
just calling them and giving a list of the items they would like to buy. What could
have been a slow transition towards the hybrid model of business has been boosted by
the sudden occurrence of the pandemic situation. Today, for any business that wants
to sustain itself, an online presence is must. The least one should expect from a store
is to have a presence on online maps, with the contact information so that the
customer can easily find the store or contact them for any query instead of doing
window shopping. The amount of footfall now is measured not just on the basis of
people coming to the store but the ones checking the store brochures, price lists, or
visiting the store online as well.
Keeping this in mind, I have done a survey of people living in a B-1 city (Based on
the House Rent Allowance classification). The focus of the survey and the study is to
find out how many people are already using omni-channel way of retail even though
they may not be aware of the term itself, keeping in consideration what are the
benefits of both the channels and why people would like to switch between the online
and the offline ways of retail.

25. 19
Chapter 4
SURVEY
• I took the opinion of the common public as well to understand how it is important
for the two formats of businesses to merge together for sustainability. If we look
at a business’ point of view, then we have to implement our business model in the
way it is sustainable in the long run.
• The demographics of the research group I have included in my research are
between the ages 14 and 40.
• These are the groups that are going to play an important role in the consumption
of the retail sector in the next 5-10 years. These individuals live in a middle-
income society in a tier 1 and tier 2 city across the country.
• The thesis of the research was to ensure how crucial it is for a business to merge
both Offline and Online retail models in the same business in order to be
omnipresent in the market in the eyes of the customer. Thus, eliminating the
disadvantages of both the channels through the other and broaden the advantages
even more. Following were my questions and their evaluations.
• The total number of respondents was 84. However, as it was an online survey,
there was no real time control on the answers of the respondents. 14 of the
respondents didn’t answer all the questions, meaning their responses were void
and thus I have to take into consideration only 70 of the responses.
• The type of sampling I have used to conduct my research is Purposive Sampling.
Purposive sampling means I used my understanding of the population and selected
the sample that is most useful for the purpose my research.
• Purposive sampling is a part of Non-probability sampling which means the
researcher selects the samples on a non-random criterion.
• The disadvantage is obviously, the fact that not every individual has a chance of
being part of the sample.
• However, the advantage is that by choosing the right sample group, that is the
people from the younger generation and the working class between the ages 18
and 40, I can find out what the future is going to look like. These are the people
who dictate the flow of trends in the retail market and thus are more suitable for
my study.

26. 20
Customer Buying Preference
Clothing
and
Fashion
49
10
11
Electronics Books
Staples and
Movies and
Grocery
Entertainm
ent
23
4
43
Luxury
items
Food
Both
Offline
Online
26
26
18
24
27
19
22
45
3
26
40
4
47
18
5
Figure 5
DATA ANALYSIS & FINDINGS
• The graph above shows the buying preference of the respondents for a particular
product category.
• Customers prefer using both the channels quite often for fashion products. But
when it comes to electronic items, customers tend towards the offline channel
because of the touch and testing option it offers before buying the product.
• When buying books, both the platforms have almost equal coverage. But when it
comes to staples or daily use items at home, offline markets, are the sole winners.
• “Over the Top” platforms have become pretty common and every new release is
being made on them directly. This is already revolutionizing the entertainment
industry.
• When it comes to luxury high value items, customers won’t easily trust online
platforms completely. However, in offline stores they can personally check and
then decide whether to buy or not.
• The introduction of food delivery platforms has made it quite convenient for a
customer to not go to the store and get all variety of food delivered to their home.

27. 21
Online vs Offline
Convenience Quality Shopping
Experience
Options Price Trust
Online Offline
Figure 6
• The above chart shows how the respondents have rated the two channels of retail
based on different factors.
• Online offers buying items by just sitting at home and getting them delivered at
the doorstep. But offline market is more reliable when the quality of the product
is in question.
• Also, thanks to the use of all 5 senses while shopping offline, the overall
experience makes it worthwhile. Online has the benefits in terms of variety,
number of sellers and the options to choose from are vast.
• The prices can be compared from retailers across the web. But when it comes to
trust, offline retailers are easy winners. Because here, the customer can personally
evaluate his purchase instead of relying on the ‘word of mouth’.
Also, the customers were asked two additional questions to determine the payments
methods used in the two channels. Offline retailers have fast been adapting the online
payments options in their stores. In fact, this has made them more convenient as a
customer, who doesn’t usually carry cash with him, definitely carries a smartphone all
the time and that’s exactly what is needed. The following graph shows the response of
the customers.

28. 22
Payment Preferences
120
100
80
60
40
20
0
When buying Offline
Online Payment
When buying Online
Cash Payment
Figure 7
• 60 percent respondents, when asked for the method of payment at an offline
store, answered that they use online payments in forms of wallets and UPI.
• They were also asked the mode of payment while buying online and surprisingly,
50 percent of them opted for Cash on Delivery option.
• This is where the point of trust comes on online platforms. People would rely
quite easily on a person or a shop they can physically see but not on a random
website that they are not sure about.
• Ask yourself this as well, how many times have you bought products online from
a retailer who is not Amazon or Flipkart. That’s why offline retailers will always
win over the online retailers on any given time.

29. 23
Chapter 5
CONCLUSION
Both the offline and online channels have their own advantages and disadvantages.
While the online platforms offer convenience to the point where you can simply ask
your Alexa without even raising a finger to place an order, they cannot offer the
reliability that offline channels have to offer. The result of the survey thus proves the
prior thesis that the customers, even though are offered with the convenience of online
shopping, won’t just shift there when money is involved as it accounts for the factors
of risk and trust. However, if a business is to survive and grow in the future, it has to
move towards the Omni channel model of retail. Looking at the offline retail
perspective, the experience that a customer has while buying from a physical shop is
unparalleled in the online market. Shopping is an experience and can only be enjoyed
fully when all the 5 senses are used. Omni channel retail offers the advantages of the
two with elimination of the disadvantages because of which the customers don’t
prefer that particular channel. Having both online and offline presence is the way of
retail of the future. The only way of survival is to be present everywhere the customer
is, to be able to sell anywhere the customer wants, and to be able to make the
customer experience the best with the best of the convenience that can be offered.

30. 24
APPENDICES
Questionnaire
1. Name:
2. Age:
3. From where do you buy the following:
• Clothing and Fashion Products
Online Offline Both
• Electronics
Online Offline Both
• Books
Online Offline Both
• Staples and Grocery
Online Offline Both
• Movies and Entertainment
Online Offline Both
• Luxury items
Online Offline Both
• Food
Online Offline Both
4. Which of the two would you prefer based on the following:
• Convenience
Online Offline
• Quality

31. 25
Online Offline
• Shopping Experience
Online Offline
• Choice and Options
Online Offline
• Price and Offers
Online Offline
• Trustworthy
Online Offline
5. When you go to a physical store how do you pay most often?
Cash Online wallet/UPI
6. When you order online, how do you pay?
Online Cash on Delivery

32. 26
India: Growth and Challenges
https://link.springer.com/article/10.1007/s40622-015-0118-9
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33. 27
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