The Fastest $3Bn Of Indian $500 Bn Retail Industry!! But Its Still A Nascent Space Waiting To Explode...

Interesting Statistics Tells That Future Potential Lies Online Only...

India’s online retail market will expand by more than 50 percent annually for the next three years, tripling to 500 billion Indian rupees ($8 billion) by 2016, according to leading Indian research firm CRISIL.

That represents a thirty-fold expansion from the end of fiscal 2008. Still, Indian e-retail represents a tiny slice of India’s total retail market, which includes a vast informal retail sector, characterized by small and disorganized individual sellers rather than companies.

Online Retail and Organized Retail In India, CRISIL Research Feb 24 2014  CRISIL Research

India Online Retail Market 2007-2016, In Rupees, CRISIL Research Report, Feb 24 2014  CRISIL Research 


Indian e-commerce landscape

80% to 90% of Revenues shared amongst 4 majors in Online Retail of Organized Retail In India, CRISIL Research Feb 24 2014  CRISIL Research  :-

Flipkart - $1 Bn 

Snapdeal - Crossed $ 500M

Myntra & Jabong - Clocking $150 - $200M

Balance 10% to 20% contributed by approx 80 companies in this space.

For context, Amazon.com made $61 billion in global revenue in 2012 via direct and third-party sales, though Amazon.com.And two of Alibaba’s portals together handled 1.1 trillion yuan ($170 billion) in sales, more than competitors eBay and Amazon.Com combined.


The opportunity in Indian e-commerce is huge. Only 0.25 percent of India’s retail$(330 Bn)  is e-commerce, versus 4 percent in Latin America, 6 percent in China, 9 percent in the U.S. and 13 percent in South Korea. The market here could grow to $1 trillion over the next ten years, if e-commerce exists to the same level as in other emerging markets, of around 4 to 5 percent of retail.

Online retailing, both direct and through marketplaces, is expected to become a Rs 50,000 crore industry by 2016, growing at a whopping 50-55 per cent annually over the next three years,

The segment has been growing in India, with revenues surging from around Rs 1,500 crore in 2007-08 to an estimated Rs 13,900 crore in 2012-13, or a annual growth rate of 56 per cent, Crisil Research said in a report. 

Yet the sector still remains a nascent portion of the overall e-commerce segment ($ 10 Bn) in the country where the travel business dominates with about two-thirds share, it said.

However, it said, the scenerio is changing fast to pose a threat to brick-and-mortar retailers, not just of books, music and electronics, but also apparel and grocery.

"From around eight per cent share of the organised retail market in India now, online retailing will zoom to around 18 per cent by 2016. But as a proportion of overall retail, including the massive unorganised segment, it will be just over 1 per cent at the end of that year," said Rahul Prithiani, Director (Industry Research), Crisil Research.
Yet, he said, the potential is huge for example, in the US, which is the biggest market for online retail and the UK, the share of online retail is around 9-10 per cent.