The benefits of modern trade will flow to government, consumers, unorganised trade participants and producers/farmers, says PricewaterhouseCoopers

CHENNAI, 2 December, 2008: A retail report, The Benefits of Modern Trade to Transitional Economies was launched by PricewaterhouseCoopers (PwC) and the Confederation of Indian Industry (CII), which articulates the benefits that modern trade will bring to the government, consumers, unorganised trade participants and producers/farmers. The report is based on interviews with Chief Executive Officers/Managing Directors at leading retail and consumer companies, secondary information and PwC’s insights.

As per this report, with modern trade, consumers will benefit from widely available choice and quantity, along with rationalisation and convergence of prices. It would lead to a zero tolerance policy for inefficiencies since consumers will become unwilling to pay for substandard products.

Mr. N.V. Sivakumar, Executive Director and leader retail & consumer practice, PricewaterhouseCoopers, says, “The growth of organised retail will lead to creation of local distribution channels in India, which in turn will improve the quality of produce available in local markets. In addition, engaging with local suppliers will boost the local economy. It would also lead to more employment opportunities as people would need to be hired to operate retail operations.”

Since modern trade players are tax compliant and their sale figures outnumber that of the unorganised sector, revenue collections will increase, says the report. Also, large retailers will require development of a support mechanism for their operations, like logistics, transportation, warehousing, which will further generate more revenues for the Government.

Farmers can benefit by being integrated into the food supply chain as farmers and modern trade players can explore partnership models for mutual benefit. Kiranas will continue to be the mainstay in India retail, since visiting them for daily needs is ingrained in the consumer behaviour. Kiranas are usually in neighbourhood catchment areas and the knowledge intimacy is hard for modern retailers to replicate. Going further, small vendors can be engaged and integrated into modern trade by large retailers, benefiting both.


The report says that organised retail will be the critical enabler for the rural, semi-urban and urban employment opportunities in the country. Once individuals become absorbed in retailers’ operations, they can access more equitable wages and benefits.

Mr. R Subramanian, Retailing for India Conference Chairman said, “The Indian retailing industry is at an inflection point. It is set to enter a new growth trajectory owing to rising household consumption and the entry of corporate entities and global retailers. The Indian retail sector is exciting, dynamic and presents tremendous opportunities for growth. This report establishes that growth of modern trade in India will indeed bring significant benefits to the economy. The case studies presented in the report illustrate the benefits accruing to the various stakeholder groups and will influence policy makers in India to create legislation that could catalyze the growth of modern trade.”


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Notes to Editor:

About PricewaterhouseCoopers
PricewaterhouseCoopers Pvt. Ltd. (www.pwc.com/India) provides industry - focused tax and advisory services to build public trust and enhance value for its clients and their stakeholders. PwC professionals work collaboratively using connected thinking to develop fresh perspectives and practical advice. Complementing our depth of industry expertise and breadth of skills is our sound knowledge of the local business environment in India. PricewaterhouseCoopers is committed to working with our clients to deliver the solutions that help them take on the challenges of the ever-changing business environment.

PwC has offices in Ahmedabad, Bangalore, Bhubaneshwar, Chennai, Delhi NCR, Hyderabad, Kolkata, Mumbai, and Pune.

“PricewaterhouseCoopers”, a registered trademark, refers to PricewaterhouseCoopers Private Limited (a limited company in India) or, as the context requires, other member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.

The name PricewaterhouseCoopers is one word, with uppercase P, uppercase C, and all other letters in lower case.

About Confederation of Indian Industry
The Confederation of Indian Industry (CII) works to create and sustain an environment conducive to the growth of industry in India, partnering industry and government alike through advisory and consultative processes. CII is a non-government, not-for-profit, industry led and industry managed organisation, playing a proactive role in India’s development process.
Founded over 113 years ago, it is India’s premier business association, with a direct membership of over 7500 organisations from the private as well as public sectors, including SMEs and MNCs, and an indirect membership of over 83,000 companies from around 380 national and regional sectoral associations.

CII catalyses change by working closely with government on policy issues, enhancing efficiency, competitiveness and expanding business opportunities for industry through a range of specialised services and global linkages. It also provides a platform for sectoral consensus building and networking. Major emphasis is laid on projecting a positive image of business, assisting industry to identify and execute corporate citizenship programmes. Partnerships with over 120 NGOs across the country carry forward our initiatives in integrated and inclusive development, which include health, education, livelihood, diversity management, skill development and water, to name a few.

Complementing this vision, CII’s theme “India@75: The Emerging Agenda”, reflects its aspirational role to facilitate the acceleration in India’s transformation into an economically vital, technologically innovative, socially and ethically vibrant global leader by year 2022.
With 63 offices in India, 8 overseas in Australia, Austria, China, France, Japan, Singapore, UK, USA and institutional partnerships with 271 counterpart organisations in 100 countries, CII serves as a reference point for Indian industry and the international business community.