View of INDIAN RETAIL MARKET AFTER COVID 19 – IMPACT AND FUTURE

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ACCENT JOURNAL OF ECONOMICS ECOLOGY & ENGINEERING Peer Reviewed and Refereed Journal, ISSN NO. 2456-1037

Available Online: www.ajeee.co.in/index.php/AJEEE

Vol. 07, Issue 06, June 2022 IMPACT FACTOR: 7.98 (INTERNATIONAL JOURNAL) 21

INDIAN RETAIL MARKET AFTER COVID 19 – IMPACT AND FUTURE

Dr. Vaibhav Sharma

Assistant Professor, Dept. of Commerce, IPS Academy, Indore

Abstract- The retail industry in India is emerging with the lines of the economic development of the society. The Indian Retail sector has gone through major transformation during the Covid-19 pandemic. The instant effect of the pandemic was unexpected flow in demand for essential goods and services; there was a problem of basic health care facilities, problem of being unemployed, shortage of funds and a sudden drop in demand for non essential items. Although all the businesses and sectors are affected due to the pandemic, this sector is badly hit due to reduced cash flows, supply chain disruptions, shortage of migrant workers due to reverse migration, less demand, and so forth like other countries. A large young working population, nuclear families in urban areas, along with increasing working women population and emerging opportunities in the services sector are going to be the key factors in the growth of the organized Retail sector in India.

Indian retail is expected to grow 25 per cent annually. Modern retail in India could be worth US$ 600 billion by 2021. The Indian Retail Industry is step by step reaching its way after getting out of from pandemic era. The retail sector is grooming with rapidly and India will have a tremendous future in organized retail sector.

1 INTRODUCTION

India is a developing economy and a big attraction for international business players because of its ideal economic policies. If we talk about retailing, it plays an important role in the development of our economy.

Retail market is one of the significant factors that contribute around 10% to country’s GDP. Almost after three years when this pandemic came into existence, we are moving towards a normal life and so is the economy. The pandemic has deeply affected the health system and retail industry of the country. The Indian retail industry has passed through so many transformations with visible technological changes. This industry keeps an important place in our economy and it is getting bigger day by day. There is a remarkable impact of COVID -19 on Indian retail sector

and definitely has some problems and challenges that this industry is going to face. There will be a new scenario in retail market after pandemic which is full of opportunities and dares.

1.1 Objectives of the Study

The Principle objective of the study is to understand the impact of pandemic on Indian retail market and to find out the challenges and opportunities for the growth of the industry.

1.2 Research Methodology

This research paper is based on Secondary Data revealed from Organized and unorganized

Retail sector in India.

1.3 Organized Retailing In India Organized retailing consists of mainly of modern retailing with shopping

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malls, food world in FMCG super markets, hyper markets and big complexes that offer a large variety of products in terms of quality and makes shopping a memorable experience. These new retail formats are constantly trying to provide the customer with the 3 V’s (variety, value and volume). Previously, customers used to go to Kirana Stores to purchases their necessities. This later changed to bigger shops run by one man with a few employees. Gradually more sophistication seeped into this sector and department stores came into being. Beginning in the mid- 1990s, after liberalization, privatization and globalization there was an explosion of shopping malls and plazas where customers interacted with professional and not with just one single person –the owner. An important point here is that customers’ requirements are catered to by trained staff. Today, organized retailing has become an experience characterized by comfort, style and speed. It is something that offers a customer more control, convenience and choice along with an experience.

Organized retailing is on continuous increase of its market share from the past. Retailing can be categorized as of different sectors like food and grocery, clothing and apparel, consumer durables, footwear, furniture and furnishing, catering services, jewelry and watches, books, music and gifts, mobile handsets and others.

2 UNORGANIZED RETAILING IN INDIA

The unorganized retailing comprises of “mom and pop” stores or kirana stores. These are very small shops

located near the residential areas.

Trading hours are flexible and the retailer to consumer ratio is very low due to the presence of several stores in the locality.

2.1 Impacts of Covid-19 on Retail Industry

The COVID-19 pandemic hit our country at a time when the economy was already facing some problems regarding demand and supply in its own market. The instant effect of the pandemic was unexpected flow in demand for essential goods and services; there was a problem of basic health care facilities, problem of being unemployed, shortage of funds and a sudden drop in demand for non essential items. When the first lockdown was declared by the union government, the economy of country along with its people went into a zone where everything was unpredictable.

The lockdown badly affected the small and medium business class and unorganized retail industry.

The deadly wave of the virus severely affected the production cycle not only in the country but across the country as well. The demand and supply chain got disturbed and operational activities of the business restricted themselves up to a least extent.

Retail sector is a labor intensive sector and it provides a good number of employment opportunities in the country. The labor employed here are part time and on call workers. Any type of disorder in retail market can decrease the degree of employment here.

After the relaxation given by first lockdown, thing were coming on the track but the second wave.

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Which came with more power and communicability, presented an another fearful era of lockdown before the country. The retail sector has witnessed a change in consumer behavior and overall lifestyle. The fear of crowded places will drive more consumers to move towards online shopping and this will have an overall impact on the retail business.

The micro, small and medium retailers as an entire form a significant share of manufacturing in India and play a vital role in providing employment opportunities and also in the country's exports but this sector has issues like the non availability of adequate material, timely, and affordable institutional credit.

Although all the businesses and sectors are affected due to the pandemic, this sector is badly hit due to reduced cash flows, supply chain disruptions, shortage of migrant workers due to reverse migration, less demand, and so forth. Like other countries, India is also expected to have major destructions in this sector with more challenges to small firms as compared with upstream firms.

Due to the government's appeal for essential business continuity, retail businesses that handle food and daily necessities such as supermarkets, drugs stores, and convenience stores (excluding stores located in office districts) have remained in good condition as consumers wait in long lines at cash registers to buy products, many of which have even sold out. On the other hand, retailers of shopping goods and luxury items deemed non essential, such as clothes and domestic devices, have stand still.

There happened lot of changes in business procedures of the retail industries due to pandemic. In business some examples of quick action taken involves pasting of stickers to maintain social distancing, using face masks to protect employees. In addition, actions such as disinfection of shopping carts and individual packaging of products to prevent droplet infection have been added to everyday routines in response to customer demand for safety, which have added to employee fatigue.

In this way, business processes throughout all areas of the retail industry have felt the impact, and have been dealing with these counter measures for several months now.

3 FUTURE TRENDS IN RETAIL MARKET

The preliminary successes of COVID- 19 vaccines offer hope at the end of a dark year for humanity, the pandemic has challenged us to think differently.

What we’ve learnt the hard way is that we must cultivate a deeper understanding of our impact on the planet and be more prudent about breaching nature’s delicate boundaries.

Now here arises a question in which direction the retail industry will go after facing the critical pandemic era.

We would like to throw light on some points that can be seen in near future–

 The retail industry will be required to take frequent action in response to changes in consumer behavior.

 The rising new role of physical stores is supposed to entail

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incorporation into the online purchasing process as the trend toward the online-merge-offline continues.

 For outlets and organizations it will be necessary to create safe and hygienic environment not only for their workers but for customers as well.

 Contactless services will be appreciated that support new behavior pattern.

 There will be a change in pattern of utilization of human resources. Labor sharing will continue to exist.

 Store managers and offices will continue to be tested and questioned on the new techniques they adopt for store management and operational structure.

 Electronic Commerce will expand progressively in the country.

 The retail industry will adopt digital technology, providing home delivery services, click and collect services etc.

 The Government of India may change the FDI rules in the food processing in a bid to permit e- commerce companies and foreign retailers to sell made in Indian consumer products.

 Both Organize and unorganized retails companies will tend to amalgamate to ensure the smooth functioning and better prospects for the overall Indian retail industry.

4 CONCLUSION

The pandemic has created an unmatched loss and disturbance over all across the world. The all sectors of the economy have been excessively affected and even within a sector, there is an unequal loss. Small retail houses are most defenseless and it is difficult for them to continue to exist without financial assistance because of their incapability to deal with such sudden trouble. The Indian Retail Industry is step by step reaching its way after getting out of from pandemic era. International retailers are viewing India as a potential market due to the rapidly growing customer base and its ability to assimilate new brands into its market. So finally, we conclude that retail sector is grooming with rapidly and India will have a tremendous future in organized retail sector.

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