Big retailers cutting into small shops' bottom line
50 per cent of small retailers surveyed saw revenues and profits drop as much as 20 pc since big retailers began opening supermarkets. Differently-abled employees
By Agencies |
NEW DELHI: The rise of Western-style supermarket chains in India is taking business away from the small, family run shops that form the foundation of India's retail market and provide a significant source of employment, a newspaper reported Wednesday.
The findings of a yet-to-be-released government study reported in a newspaper are potentially explosive. Owners of small shops that sell everything from produce to razor blades have repeatedly ransacked large supermarkets being set up by national chains.
The study is based on a survey ordered by the prime minister's office and conducted by the respected Indian Council for Research on International Economic Relations. It covered 1,600 small retailers in four Indian cities, the paper said.
According to it, 50 per cent of the small retailers surveyed have seen revenues and profits drop as much as 20 per cent since big retailers began opening supermarkets over the past year. Of those reporting declines, 61 per cent blamed the Western-style chain stores.
The newspaper did not say when the survey was conducted or what questions were asked. The margin of error was not provided, but according to a standard table of sampling errors based on 1,600 respondents, it would be about 4 percentage points.
The study has reportedly been in the works for months. The prime minister's office refused to discuss Mint's report. Officials at the Indian Council for Research did not respond to calls seeking comment.
The survey comes as major Indian industrial conglomerates, such as Reliance Industries Ltd., the Aditya Birla Group and Bharti Enterprises Ltd. are opening and planning thousands of retail stores across the country.
Companies like US retailer Wal-Mart and Carrefour SA of France are also lobbying the government to change rules that bar them from setting up shop in India. Officials say the rules are in place to protect the estimated 12 million family owned shops that dominate India's retail sector, believed to be worth more than $250 billion (euro170 billion) a year and growing 20 per cent annually.
The findings of a yet-to-be-released government study reported in a newspaper are potentially explosive. Owners of small shops that sell everything from produce to razor blades have repeatedly ransacked large supermarkets being set up by national chains.
The study is based on a survey ordered by the prime minister's office and conducted by the respected Indian Council for Research on International Economic Relations. It covered 1,600 small retailers in four Indian cities, the paper said.
According to it, 50 per cent of the small retailers surveyed have seen revenues and profits drop as much as 20 per cent since big retailers began opening supermarkets over the past year. Of those reporting declines, 61 per cent blamed the Western-style chain stores.
The newspaper did not say when the survey was conducted or what questions were asked. The margin of error was not provided, but according to a standard table of sampling errors based on 1,600 respondents, it would be about 4 percentage points.
The study has reportedly been in the works for months. The prime minister's office refused to discuss Mint's report. Officials at the Indian Council for Research did not respond to calls seeking comment.
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The survey comes as major Indian industrial conglomerates, such as Reliance Industries Ltd., the Aditya Birla Group and Bharti Enterprises Ltd. are opening and planning thousands of retail stores across the country.
Companies like US retailer Wal-Mart and Carrefour SA of France are also lobbying the government to change rules that bar them from setting up shop in India. Officials say the rules are in place to protect the estimated 12 million family owned shops that dominate India's retail sector, believed to be worth more than $250 billion (euro170 billion) a year and growing 20 per cent annually.
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