The retail industry in India is mirroring the rapid changes in consumption patterns and the clientele is sharply segregated, with the rural areas still more comfortable with traditional retail formats. This is the summary of the India Retail Sector Analysis (2006-07), which has been released by the research agency RNCOS.

Organised retail is targeting high-income urban customers, but the unorganised sector caters primarily to the traditional customer base of lower income segments in the rural pockets. This is probably why the two forms of retailing manage to co-exist in India.

Organised retail, meanwhile, has undergone rapid changes and has metamorphosed into a high-growth industry. With the mushrooming of malls, multiplexes and supermarkets, consumers are treated to a completely different shopping experience.

The stature of the Indian retail sector is significant, with a whopping five million retail outlets spanning across the country. But most of these are self-styled traditional units, with significant local presence, lacking anything close to a modern retailing.

For this very reason, industry experts feel that opportunities in organised retailing are going to increase manifold. The study says the retail sector is a major revenue churner, with a market size of Rs 10 trillion in 2005. The size of organized retailing in India hovers around Rs 351 billion and is rapidly gaining ground.

An analysis of the Indian retail sector reveals that the average growth rate for the segment is around 32% in comparison to a modest 8% in the unorganised sector. Rural India is the major revenue driver for unorganised retailing in India with a share of 76%. Overall, the Indian retail industry contributes 10% to the GDP and a source of employment for more than 41 million individuals.

For more information on the study, go to www.rncos.com