1. A STUDY OF INDIAN APPAREL RETAILERS’
EXPANSION FROM TIER I TO TIER II AND TIER III
CITIES – A CASE STUDY ANALYSIS
Submitted by:
Amrapali Sinha
Khushboo Priyambada
Surendra Meena
Yogesh Bherwani
M. F. M. – I
Department of FMS

2. Introduction
• Retailing is the final stage in a channel of distribution.
•
It comprises all of the businesses and people involved in the
physical movement and transfer of ownership of goods and
services from producer to consumer.
• New formats such as departmental stores, hypermarkets,
supermarkets and specialty stores.

3. Introduction

4. Statement of problem
• In tier I cities, there is intensified competition amongst the
retailers as the market is saturated
• Many retailers are looking for growth opportunities in tier II and
III cities as the disposable incomes of people in tier II and III
cities have increased.

5. Objective
• To study current scenario of India apparel retailing.
• To understand the factors which are influencing the retail
expansion from tier I to tier II and tier III cities.
• To study the strategy among the selected Indian apparel
retailers in tier II and tier III.

6. Research Methodology

7. Data collection
In our project, we are collecting secondary data
from various sources:
• Websites and e-books.
• Books from the Learning Resource Centre.
• Graphical Data and Journals and magazines
published by private agencies.

8. Data collection

9. Limitation
1. The project is based on the secondary data.
2. This project focuses only on the apparel retail sector in India.
3. Case study of apparel retailers are taken. Only four case study
of apparel retailers are taken due to time limitation.
4. Study was done only on the apparel industry’s scenario for last
decade.

10. Current Indian Apparel Retail
Scenario

11. Current Indian Apparel Retail Scenario
• Indian retailing is expanding and is
expected to reach at US$637 billions by
2015.
• India is rated as the fifth most striking
emerging retail market.
• Indian retail industry which stands 2nd in
terms of employment generation after
agriculture.
• It is estimated that 70 million Indians in a
population of about 1 billion now earn a
salary of $18,000 a year.

12. Current Indian Apparel Retail Scenario
A comparative picture of GDP contribution by retail sector of year 2010
S. No.
Country Contribution of retail
sector to GDP
1
USA
12%
2
India
12%
3
China
8 – 10%
4
Brazil
6%
Source: Vidushi Handa, and Navneet Grover, “Retail Sector in India: Issues & Challenges”, International Journal of Multidisciplinary
Research, Vol. 2, Issue 5, May 2012, ISSN 2231-5780

13. Current Indian Apparel Retail Scenario
• The Indian Retail sector is estimated to have a market size of
about $180 billion, but the organized sector represents only 2%
share of this market.
Source: Hemant Sayal, “Retailing in India” International Journal of Research in Finance Marketing, Vol. 1, Issue 8, December 2011,
ISSN 2231-5985

14. Current Indian Apparel Retail Scenario
Major retailers in India
NAME
COMPANY
SHOPPERS STOP
Incorporated by K.Raheja Group.
PANTALOONS
It is a flagship enterprise of ‘The Future Group’
LIFE STYLE
Incorporated as a part of Landmark group (Dubai)
WESTSIDE
Incorporated as a part of Tata Group, Trent Ltd
GLOBUS
Company is ISO 9001 certified wih ERP enable supply chain.
PETER ENGLAND, LOUIS PHILIPPE , Bran.ds iarelicensed by Madura Garments the retail arm of AdityaBirla
ALLEN SOLLY,
Group’s garment division
VAN HEUSEN
JOHN PLAYERS
Launched by ITC Ltd
PARK AVENUE
Launched Raymond Ltd

15. Current Indian Apparel Retail Scenario
Retail sales in India
Source: Shahid Akhtar, and Iftekhar Equbal, “Organized retail in India- opportunities and challenges”, International Journal of
Mulyidisciplinary Research”, Vol. 2, Issue 1, January 2012, ISSN 2231-5780.

16. Current Indian Apparel Retail Scenario
Classification of cities and
Number
towns
of
Name of cities
Cities
Tier I: Major cities
6 cities
Mumbai, Kolkata, Delhi, Chennai, Bangalore, Hyderabad.
Tier II : Mainstream
58 cities
Ahemdabad, Surat, Kanpur, Nagpur, Lucknow, Jaipur, Kochi, Vadodra, Indore, Ludhiana, Madurai,
Bhopal, Patna, Pune, Visakhapatnem, Vijayawada, Coimbatore, Rajahmundry, Faridabad, Jabalpur,
Cities
Jamshedpur, Allahabad, Amritsar, Raipur, Mysore, Mangalore, Bhubaneshwar, Amravati,
Aurangabad, Srinagar, Ranchi, Guwahati, Gwalior, Chandigarh, Bhilai, Siliguri, Loni, Ulhasnagar,
Kota, Howrah, Navi Mumbai, Ghaziabad, Nagpur, Thane, Nasik, Agra, Varanasi, Rajkot……
Tier III : Climbers
46 cities
Tiruchirapalli, Jodhpur, Pondicherry, Aligarh, Moradabad, Indore, Gorakhpur, Patiala,
Salem,
Haridwar, Katihar, Shimla, Purnia, Bilaspur, Bareily, Jalandhar, Ajmer, Bikaner, Noida, Asansol,
DurgapurDehradun, Dehradun, Firozabad, Jamnagar…
Tier IV : Small Towns
5094 cities
Rohtak, Rourkela, Udaipur, Anand, Hassan, Etawah, Ratlam, Sonipat, Bhatinda, Karnal, Panipat,
Bihar Sharif, Darbhanga, Dewas, Alwar, Bardhman, Ujjain, Bhagalpur, Agartala, Bhilwara,
Mathura, Bijapur, Chandrapur, Junagarh…
Source: C. S. Dalvi, and Sayali Pataskar, “Organized retailing in smaller cities – the next move”, International Journal of Research in
Commerce and Management, Vol. 2, October 2011, ISSN 0976-2183.
http://en.wikipedia.org/wiki/Classification_of_Indian_cities (accessed on 5. 12.2012)

17. Current Indian Apparel Retail Scenario
Mega cities
City
Population 2007-08
Average Household Expenditure
(Rs. Per annum in 2004-05)
(million)
Average Household Income
( Rs. Per annum in 2004-05)
Mumbai
20.3
4,59,457
2,01,140
Delhi
15.5
4,08,237
2,05,028
Kolkata
13.8
2,87,199
1,74,951
Chennai
6.9
3,37,059
1,55,286
Bangalore
6.6
3,00,678
1,64,923
Hyderabad
5.7
2,73,353
1,49,251
Ahmedabad
4.8
3,17,856
1,34,497
Pune
5.1
2,10,458
1,26,958
Mega Cities
78.6
3,54,090
1,76,977
Source: C. S. Dalvi, and Sayali Pataskar, “Organized retailing in smaller cities – the next move”, International Journal of Research in Commerce
and Management, Vol. 2, October 2011, ISSN 0976-2183.

18. Current Indian Apparel Retail Scenario
Boom towns
• High expenditure per household
• Emerging as the largest markets following the mega cities
• Characterized by younger population
• Fastest growth in disposable income.

19. Current Indian Retail Scenario
Boom towns
City
Population 2007-08
Average Household Expenditure (
Per annum in 2004-05)
(million)
Average Household Income (Rs.
Rs. Per annum in 2004-05)
Surat
4.0
4,31,206
1,90,591
Kanpur
2.7
1,59,761
1,18,567
Jaipur
3.4
3,00,374
1,67,540
Lucknow
2.6
2,80,393
1,52,948
Nagpur
2.5
3,08,625
1,82,871
Bhopal
2.8
1,65,210
1,28,836
Coimbatore
1.7
2,19,846
1,52,050
Boom Towns
19.8
2,83,071
1,59,407
Source: C. S. Dalvi, and Sayali Pataskar, “Organized retailing in smaller cities – the next move”, International Journal of Research in
Commerce and Management, Vol. 2, October 2011, ISSN 0976-2183.

20. Current Indian Retail Scenario
Niche cities
•
Somewhat smaller in terms of overall population, but still high
on spending per household
• Household expenditure nearly the same as that found in mega
cities
• Have the highest spending propensity of the three city groups

21. Current Indian Retail Scenario
Niche cities
City
Population 2007-08
Average Household
(Rs. Per annum in 2004-05)
(million)
Average Household Income
Expenditure ( Rs. Per annum in
2004-05)
Faridabad
2.1
2,52,558
1,64,457
Amritsar
1.9
2,67,056
1,64,540
Ludhiyana
1.5
2,73,211
1,34,187
Chandigarh
1.1
4,84,775
2,12,805
Jalandhar
1.1
2,96,651
2,29,335
Niche Cities
7.7
3,04,265
1,74,287
Source: C. S. Dalvi, and Sayali Pataskar, “Organized retailing in smaller cities – the next move”, International Journal of Research in
Commerce and Management, Vol. 2, October 2011, ISSN 0976-2183.

22. Current Indian Apparel Retail Scenario
Predicted mall distribution space in India
• The
number
of
operational malls was
over 412 with 205 million
square feet in 2010 and
further 715 malls by 2015,
on the back of major retail
developments even in tier
II and tier III cities in India.
Source: Vidushi Handa, and Navneet Grover, “Retail Sector in India:
Issues & Challenges”, International Journal of Multidisciplinary
Research, Vol. 2, Issue 5, May 2012, ISSN 2231-5780

23. Current Indian Apparel Retail Scenario
•
Rapid income growth: consumers have a greater ability to spend.
•
Increasing Urbanization: larger urban population that value convenience,
coupled with the higher propensity of the urban consumers to spend.
•
Growing young population: growth of the post-liberalization maturing
population, with the attitude and willingness to spend.
•
Spend now vs. save earlier: consumers are willing to borrow for present
consumption, which has resulted in the emergence of big retail chains in
most metros; mini metros and towns.

24. SWOT Analysis of Indian Apparel
Retail

25. Strength
SWOT Analysis of Indian Apparel Retail

26. Weakness
SWOT Analysis of Indian Apparel Retail

27. Opportunity
SWOT Analysis of Indian Apparel Retail

28. Threat
SWOT Analysis of Indian Apparel Retail

29. Reasons for spread of organized
retailing into smaller cities
• Changing Demographics and Consumption Patterns
• Consumer Behavior Trends
• Abundant Availability of Skilled Labor

30. Case Study of Indian Apparel
Brands

31. Wills Lifestyle
• Wills Lifestyle, the ITC-owned premium apparel brand
• 70 exclusive specialty stores across 30 cities
Expansion plan
• Plan to open 20 stores in cities such as Mangalore, Mysore and
Jodhpur in the next 12 months
• Plans to enter 10 new cities including Jalandhar, Coimbatore,
Guwahati, Amritsar, Bhopal, Aurangabad, and Indore in the last
year-and-a-half

32. Raymond
• One of India's largest branded fabric and fashion retailers
• 700 retail shops spread across India and overseas, in over 200
cities
Expansion plan
• Raymond has opened around 250 stores in last 3 years
• Target for Raymond is to open another 500 stores over the next
three years
• company-owned stores & franchisee-owned stores
• New towns: Jalna, Latur, Porbander, Nanded, Bardoli and
Baramati

33. Lifestyle
• In 1999, Landmark Group introduced Lifestyle Stores
• Lifestyle has 33 stores in 20 cities of the India
Expansion plan
Cities: Kolkata ,Lucknow, Ranchi , Gandhinagar, Raipur,
Allahabad , Patna, Indore, Amritsar, Bhopal

34. Pantaloons
• Owned by Future group.
• India’s favorite fashion chain has 57 stores across the country
offering
Expansion plan
• Pantaloons Retail plans to double the total number of stores
• Stores would be opened in Kochi, Mysore, and Vishakhapatnam
soon

35. Conclusion
• The advent of organized retailing, market saturation, rising incomes
and increasing demand for better quality products into developing
market of tier II and III cities is a win-win situation for all the apparel
retailers.
• The success of organized retailing in tier II and III cities rests largely
on further development of appropriate infrastructure.
• As per our study Wills lifestyle, Raymond, Lifestyle and Pantaloons
are targeting smaller. Aiming for market saturation, these companies
are planning to cover all important areas with wider expansion into
tier 2 and tier 3 cities.

36. Thank you