by The organized retail sector refers to large corporate-owned retail chains or franchises that have standardized operations across stores. This includes supermarkets, hypermarkets, departmental stores, specialized retail stores and e-commerce firms. Organized retail encompasses multiple retail formats such as food & grocery, clothing & apparel, consumer electronics, furniture & furnishings, home improvement and automotive. Online sales via the e-commerce retail model have been gaining prominence in recent years.
The global organized retail market is estimated to be valued at US$ 28.34 Bn in 2023 and is expected to exhibit a CAGR of 4.2% over the forecast period 2023-2030, as highlighted in a new report published by CoherentMI.
Market Dynamics:
Rising Middle-Class Population in Emerging Economies: Expansion of the organized retail sector is driven by the steadily rising middle and affluent classes across emerging economies such as India, China, Indonesia, Brazil and South Africa. Growing disposable incomes coupled with easy access to credit is enabling these consumers to increasingly purchase goods and services from organized retail chains. This is expected to drive a switch from traditional ‘mom & pop’ stores to corporate retail formats.
Easy Financing Options: Availability of enhanced digital payments options along with easy EMI options from banks and non-banking financial institutions has facilitated affordability and access for consumers. This in turn has boosted sales volumes in consumer durable goods and luxury product categories for organized retailers. For example, retail of smartphones, appliances, electronics and furniture sees patronage of attractive “buy-now-pay-later” financing schemes.
Segment Analysis:
The organized retail market can be segmented into hypermarkets, supermarkets, convenience stores, cash & carry stores, and others. Among them, the hypermarkets segment dominates accounting for over 30% share due to the wide range and economy of scale offered. The segment provides a one-stop shopping experience to customers with a large variety of products ranging from groceries to electronics and apparels under the same roof.
Pest Analysis:
Political: The government’s favorable FDI policies in the retail sector have attracted major foreign retailers to establish their presence in the country aiding market growth. However, certain regulations around shop timings impact organized retailers.
Economic: Rising income levels, urbanization, and easy access to credit have boosted consumer spending on high-value and branded products, benefiting organized retailers. However, inflation poses a challenge by raising input costs.
Social: Evolving consumer lifestyles and preferences toward quality, convenience, and shopping experience support the organized retail market. However, brand loyalty is still low.
Technological: Digital and mobile platforms allow retailers to enhance customer engagement, online-offline integration, and provide personalized experiences through big data analytics. Automation also helps improve supply chain efficiencies.
Organized Retail Market Segmentation:
- Global Organized Retail Market, By Product Type
- Electric
- Food
- Consumer
- Other
- Global Organized Retail Market, By Application
- Personal
- Commercial
Key Takeaways:
The global Organized Retail Market Size is expected to witness high growth over the forecast period supported by rapid urbanization, rising disposable incomes, and increasing penetration of global brands. The global organized retail market is estimated to be valued at US$ 28.34 Bn in 2023 and is expected to exhibit a CAGR of 4.2% over the forecast period 2023-2030.
Regional Analysis: The organized retail market in India dominates accounting for over 35% share owing to favorable demographics, rising middle-class, and government reforms. China follows as the second largest market in the region.
Key Players: Key players operating in the organized retail market are Amazon, Apple, Flipkart, Future Group, Reliance Retail. Amazon leads the market with its extensive product portfolio and logistics network while Reliance Retail is growing rapidly through its expanding footprint of supermarket and fashion brands.
*Note:
1.Source: CoherentMI, Public sources, Desk research
2.We have leveraged AI tools to mine information and compile it
