Founder Idiom Design & Consulting Ltd
In Retrospect: 2012
There was a change in the market from 2009 onwards when effects of the global recession started hitting our shores. There has been a significant slowing in the real estate business, thereby directly affecting the retail design business as well. There was a slowing down of projects which in turn affected cash flows. In the Indian retail industry, there has been a considerable decelerate in roll-out of stores by majors, a trend of consolidation; shutting down of non performing stores and fine tuning of concepts in terms of more bang for the buck for existing concepts and fewer new retail concepts coming on stream. We are also seeing more of the regional retailers and smaller entrepreneurial retailers taking bold steps into the more organized retail market. Besides, there has been a proliferation of regional and local retailers appearing in the larger shopping malls, which were hitherto a challenging space for them. We now have several clients who are venturing into malls and multiple outlets for the first time.
Arrival of FDI
In the short term it has been more of a mood elevator than a business elevator. It will be sometime before FDI releases a flood of new investment both into Indian companies and foreign companies coming in to do business. The riders of state level policy have added uncertainty and the pronouncements of threatened roll-back by the opposition and fractious coalition partners have not helped the risk perception of doing business in India. Overall, it is a good move and will bring in investment in the years to come. IKEA is the only company that has announced a game plan but the rest are still in a wait and watch mode and cautious about moving forward. The Indian industry will have to accelerate in terms of getting world class quality and professionalism, but would need to keep a tight control on costs and improve time efficiency as well. Also, a more qualified and trained man power is required which is currently missing.
Looking Ahead: 2013
Firms need to expand the market and not merely compete for market share. There will be some level of specialization that will also come in such as roll out first or concept first firms, hospitality and food services focused firms and so on. Many of the newer and smaller entrants require comprehensive services. There would also be opportunities for collaboration and co-creation. Most importantly, there are prospects for uniquely Indian concepts to surface even as we get integrated into a uniform global shopping environment.