, India

India's groceries thrive amidst weaker consumption

The sector is best equipped to address a higher demand for discounts.

Demand for consumer goods through wholesale mass grocery retail channels are expected to be on the rise, as Indian consumers are likely becoming more price-sensitive due to eroding purchasing power, according to Fitch Solutions.

India's real GDP is projected to fall 8.6% YoY in 2020, and is expected take until 2023 to recover to pre-pandemic levels. Thus, household disposable incomes will feel pressure over the medium-term (2020-2024).

Disposable incomes are tipped to grow at an average annual rate of 3.2% YoY over 2020-2024, compared to 11.8% YoY over 2015-2019. Meanwhile, inflation is projected to average 4.1% over the same period, outspeeding incomes.

As a result, nominal household spending over the medium term (2020-2024) is projected to average 3.2% YoY which represents a slowdown compared to the historic period (2015-2019) at 11.8% YoY.

With this, Fitch said that companies operating in India will have to navigate the challenges the country is facing: investment sentiment dampened and consumer appetite weakened.

However, the report noted that the mass grocery retail sector has a navigation tool at its disposal, as the sector is best placed to address a higher demand in discount.

Already, Metro Cash & Carry opened its 28th store in India in Karnataka in October. Siam Makro is also looking to open 12 wholesale distribution centres in the country over the next three years and invest over $150m over five years.

"India's discount and wholesale sector is developing with a number of international players having recently set up operations in the country. These companies continue expanding their discount and wholesale brands in India, with some developments already under way," the report stated.
 

Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

Get Retail Asia in your inbox

Customers take center stage: Using innovation to grow your business

This exclusive Retail Asia virtual round table on 28 May will guide retailers on how to meet their customer's needs and sustain their business during the pandemic.

How NTUC FairPrice's consumer centric mindset became its golden goose

The "FairPrice on Wheels" community initiative brings daily essentials to mature estates with higher concentration of low-income seniors.

US-based Sam’s Club launches first Huizhou store

The store offers sampling activities, free eye and hearing tests, and wine tasting.

Hongkong Land launches shopping mall in Chongqing

It features a seven-storey botanical garden and sports and cultural interactive offerings.

Revenge spending boosts South Korea’s luxury retail

Both women’s and men’s clothing stores saw a rise in sales this year.

How South Korea’s supermarkets lure in neighborhood customers

Customers have been shopping more through local shops and online platforms.

Shinsegae’s Emart offers ‘e-money’ to customers

Shoppers can save up to 3,000 points by finding products sold cheaper elsewhere.

South Korea’s department stores scramble for better products

The rapid rise of online shopping has weakened their status amongst SMEs.

Alibaba's Taobao Deals to roll out more direct-from-producer products

The app saw 100 million users during its first year.

JD’s Seven Fresh launches first Shenzhen store

Customers can get imported produce as well as local fruits from Guangdong.