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Thursday, January 8, 2015

Online Sales of Consumer Goods and Retail in India to Grow 40 Percent: Report

The Indian consumer goods and retail industry is estimated to witness its online sales growing by 40 percent till 2019, which is the fastest among the emerging markets, while store-based sales will grow by just 10 percent, according to a report.
As per the report by EY and the Consumer Goods Forum on global consumer goods and retail omni-channel supply chain, online sales to be witnessed in Indian consumer goods and retail industry will be the second fastest globally after Nigeria at 79 percent.

In India, growth in store-based sales is expected to be at 10 percent, vis-a-vis 40 percent growth in Internet sales, the report said.

During 2014-19 period, global online sales for the consumer goods and retail industry would grow by 15 percent, while the traditional set up would have a growth of 5 percent only.

"In emerging markets, the gap between store-based and online growth will be even greater," the report added.

In the emerging markets category, India is followed by its arch-rival China with an expected online sales growth of 21 percent and 8 per ent from traditional establishments during the period.

Highlighting the need to build a more responsive, integrated supply chain and improve consumer visibility, the report said omni-channel is fast becoming the key driver for consumer products and retail sector growth, but few can make it profitable using the traditional supply chain.

Commenting on the findings, EY's Global Supply Chain and Operations Leader Andrew Caveney said: "Reengineering the omni-channel supply chain must be a priority for consumer goods companies and retailers if they are going to remain relevant to both the consumer and their shareholders."

Interestingly, online sales growth in developed markets like the US and the UK are estimated to be only 12 percent, which are below than the global average of 15 percent.

Similarly, France and Germany would have 13 percent and 14 percent online growth, respectively, for consumer goods and retail industry.

As for store-based sales growth, France and the UK would have a growth of 2 percent, Germany and the US at 3 percent and 4 percent, respectively, during 2014-19, which is again below than global average of 5 percent.

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