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The retail sector in India is expected to reach US$ 2 trillion in value by 2032, according to a recent analysis by the Boston Consulting Group (BCG).
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India’s retail trading sector attracted US$ 4.68 billion FDIs between April 2000 and September 2022.
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Nearly 60 new shopping malls with a total retail space of 23.25 million square feet are expected to become operational during 2023-25.
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As of 2021, there were ~1.20 million daily e-commerce transactions. The number of online shoppers in India are expected to reach ~500 million in 2030 from ~150 million in 2020. The gross merchandise value (GMV) in the e-commerce market is expected to touch US$ 350 billion by 2030.
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Private labels and D2C products accounted for 10% to 12% of Indian retail market share and registered a higher growth than other types of manufacturers. Large e-commerce players, including Tata, Reliance, Aditya Birla Group, Amazon, Flipkart, etc. offer private label brands to their consumers in India.
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The growth of private labels and D2C brands is linked to the growth of modern retail. Retailers are striving to earn customers’ trust, which is essential to run private labels and D2C businesses.
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Private labels and D2C brands offer a wider range of products, which provide better quality at affordable prices for customers. The products also plug the selection gaps that exist in the market.
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Consumer preferences will continue to shift toward more affordable and high-quality products and to private labels and D2C. Producing such products is a terrific opportunity for the growth of retailers and MSMEs.
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The government of India must support MSMEs offering private labels and D2C brands by reducing the regulatory and compliance burden and ensuring ease of doing business, while plugging the loopholes in the current market practices.