RETAILING INDUSTRY IN INDIA

1. Five opportunities and threats for domestic and foreign companies in India?

The five opportunities and threats that can be laid down that domestic and foreign companies
are as follows:

Opportunities

(a) Retail is one sector in India that is rapidly growing. Given a boost by the Make in
India Campaign, this sector has attracted a lot of attention both from domestic and
well as foreign sectors. It is promising and provides one avenue where investors as
well as the companies that can reap the benefit from.
(b) Another aspect is the quick and easy influx of technology and transportation routes
for the companies. Globalisation has proven to be the major catalyst that has helped
companies realise their goals of penetrating onto foreign markets
(c) In the last few decades skilled labour has got a significant boost. Aided by higher
education and vocational courses in multiple streams introduced by both the state and
central governments, it has provided the impetus to companies to recruit the best
talent.
(d) Not just labour, India is a storehouse of a lot of geological wealth in the form of coal,
iron, mineral ores, power, etc. The easy availability and continuous research in this
area has given the assurance to companies that they can establish base in the country.
(e) Of course, the policies of the government is also shaping as to how companies decide
to invest their fortunes here. Government is providing numerous opportunities in the
form of tax and land rebates, SEZs, easy loan entitlements that help companies to reap
these companies.
Threats:

(a) Product and Market differentiation can be a big issue when it comes to the several
companies intending to do business in India. Because of a mostly monopolistic
economy and close substitutes of goods, it can be quite an arduous task to establish
market base.
(b) There is a fear that this might lead to unfair competition and smaller companies or
incumbents might have a tough time to deal with such changes.
(c) Another concern is that the Indian retail sector, particularly organized retail, is still
under-developed and in a nascent stage and that, therefore, it is important that the
domestic retail sector is allowed to grow and consolidate first, before opening this
sector to foreign investors
(d) The global retailers would conspire and exercise monopolistic power to raise prices
and monopolistic (big buying) power to reduce the prices received by the suppliers;
thirdly, it would lead to asymmetrical growth in cities, causing discontent and social
tension elsewhere. Hence, both the consumers and the suppliers would lose, while the
profit margins of such retail chains would group
(e) FDI in Indian retail will indirectly or directly contribute for the enhancement of
Tourism, Hospitality and few other Industries, the culture of the people in India will
slowly be changed. The youth will easily imbibe certain negative aspects of foreign
culture and lifestyles and develop inappropriate consumption pattern, not suited to our
cultural environment.

2. ETOP MODEL FOR COMPANY WISHING TO ENTER INDIA

The following is the proposed ETOP model for a foreign Telecom Firm to enter India:

ENVIRONMENTAL NATURE IMPACT OF EACH SECTOR

SECTORS OF
IMPACT
ECONOMIC Boost to competition, low prices for consumers

MARKET Increase in demand if quality is at par or better

INTERNATIONAL Larger International customer base

POLITICAL No political impact as such

REGULATORY TRAI, the regulatory body and DOT make key

decisions, which the company has to abide by
SOCIAL Increase in product and service penetration,
raising the standards of living among all
SUPPLIER More spread in vendor relations

TECHNOLOGICAL Developing countries get to reap the benefit of

advanced technology