Many global retailers absent in India due to various reason; CBRE undertook a research study of 317 prominent global brands across numerous segments and geographies. Of these 317 brands, only 196 brands are operational in India.

Jun 03, 2014, 09.18 PM IST | Source: PTI
Many global retailers absent in India due to various reason

CBRE undertook a research study of 317 prominent global brands across numerous segments and geographies. Of these 317 brands, only 196 brands are operational in India.

Restrictions in foreign investment in multi-brand retail and lack of quality real estate space have prevented more than 39 percent of global retailers such as 7Eleven, Costco and FamilyMart from entering India, said a CBRE report.

CBRE undertook a research study of 317 prominent global brands across numerous segments and geographies. Of these 317 brands, only 196 brands are operational in India. Anshuman Magazine, Chairman and Managing Director, CBRE South Asia, said: “India is still a largely untapped and unorganised retail market as a large number of prominent global retailers are yet to commence operations here.

“The country holds a considerable advantage over other emerging retail destinations due to its strong domestic consumption and low-rate of market penetration by international retailers.”

He, however, said that with political and economic sentiments already showing signs of improvement, this is the right time for international retailers to look at India for expansion. According to the survey, most global retailers active in India are in the fashion and apparel, accessories, and F&B categories.

Hypermarkets have remained an under-penetrated segment because of stringent FDI regulations restricting the entry of foreign supermarket chains in the country. The report, ‘Expanding Horizons of Global Retailers in India’ said majority of the international retailers surveyed opted to enter India by opening a store in a metropolitan city, such as New Delhi (79 per cent) or Mumbai (68 per cent), before gradually expanding their footprint to other tier I locations, including Bangalore, Chennai, Hyderabad, Kolkata and Pune.

“Retailers of the size of Ikea often find it challenging to secure space in a prime mall. This is essentially because the majority of retail space developed in India to date lags behind global standards, and does not provide the quality, ambience, design, services or post-construction maintenance that global retailers are accustomed to,” it added.

 

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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