FDI in Multi-brand Retail Dangerous for India Aug 10, 2011 - EnGLISH

8/2/2019 FDI in Multi-brand Retail Dangerous for India Aug 10, 2011 - EnGLISH

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August 10, 2011


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Authos emb le


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What this presentation will cover


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Lets st t with lesson fom the s


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eet one of histoys olific huntes


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The American buffalo


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The American buffaloWhy didnt nyone se k out?


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The American buffaloWhy didnt nyone se k out?


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Lessons for us in the FDI context


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A few comments to set the contextand explain the perspective of thisesenttion


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Time horizon


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No speculation


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Comparison with China is wrong


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Comparison with China is wrong

not


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Indian situation is unique


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Indian situation is unique


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od ys inco ect n tive

WRONGRETAIL IN THEWEST IS FLAWED!


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Big Capital vs Democratic Capital


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Let us examine the implications ofFDI in multi-brand retail


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1) Who are we letting into the country?


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Who are we letting in?

Largest Indian company isabout half the the size ofthe smallest of these four!


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Who are we letting in?Want evidence?


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More on this specious argument later.)


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2) Big Foreign Retail is a game ofconcentration and domination


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Concentration and domination


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Concentration and dominationGrocery Retail Brand shares by country

Country Top retail brands MarketShare Market Shareof top brands Year

Europe

Sweden ICA Stores 50% 2010

COOP 20%

Axfood AB 16% 86%

Germany Metro 2009

Edeka

Rewe

Schwarz

Tegelmann 75%

Belgium Carrefour 29% 2009

Delhaize 25%Colruyt 25% 79%

UK Tesco 30% 2009

Asda 17%

Sainsbury 16% 63%

France Carrefour 25% 2009

Le Clerc 17%Mosquetaries 13% 55%


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Country Top retail brandsMarketShare

Marketshare oftopbrands Year

North America

Canada Loblaw Cos 37 2010

Sobeys Inc 18

Metro 14 69%US Wal-Mart 2009

Kroger

Target 30%

Other Markets

Australia Woolworth 46% 2010

Coles 32% 78%

Mexico Walmart 47% 2010

Soriana 14%

Commercial Mexicana 9% 70%

Brazil Carrefour 14% 2009

Cia. Brasileira de Distribuicao 13%

Walmart 10% 38%


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Country Top retail brandsMarketShare

MarketShare oftopbrands Year

Asia

Thailand CP-All (Part of 7-Eleven) 11% 2010

Tesco Lotus 9%

SHV Makro 5%

Big C-Casino Group 5%

Central Retail 2% 32%

Indonesia Carrefour 2010

Alfamart

Indomart

Matahari

Makro Indonesia 15%


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Concentration and dominationSources:
http://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.brassicastoday.com/en/france-hypermarket-and-supermarket-chains-redefine-their-strategies-to-attract-consumers.aspxhttp://www.reuters.com/article/2011/04/27/britain-grocers-kantar-idUKLDE73Q0TP20110427http://www.reuters.com/article/2011/04/27/britain-grocers-kantar-idUKLDE73Q0TP20110427http://www.reuters.com/article/2011/04/27/britain-grocers-kantar-idUKLDE73Q0TP20110427http://www.reuters.com/article/2011/04/27/britain-grocers-kantar-idUKLDE73Q0TP20110427http://www.reuters.com/article/2011/04/27/britain-grocers-kantar-idUKLDE73Q0TP20110427http://www.reuters.com/article/2011/04/27/britain-grocers-kantar-idUKLDE73Q0TP20110427http://www.reuters.com/article/2011/04/27/britain-grocers-kantar-idUKLDE73Q0TP20110427http://www.narga.net.au/documents/2010/NARGA_lowres_web.pdf


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Concentration and domination


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3) Big Retail is about control, andsqueezing costs on the supply side.


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It is about control squeezing suppliers


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It is about squeezing suppliers


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It is about squeezing suppliers

Farmprice Retail price Whatfarmers inUSA get


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It is against national security

Lesson


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It is against national securityLessons in protecting national security from the USA:

Lesson


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It will destroy employment


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It will destroy employmentHow Big Retail reduces storesUS experience

USApopulationTotal retailestablishments IndependentsChainstores1951 155 mn 1,770,000 1,600,000 105,0002011 312 mn 1,500,000 1,145,000 350,000


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Number ofretail outletsclosedChief WageEarnerslosing jobs

Number oflivesaffected1 of losses 130,000 250,000 12.5 lakhs30 oflosses in 10years

39lakhs 75lakhs 3.75crs.


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It will destroy employmentOffshoring of jobs:


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It will destroy employmentOffshoring of jobs:


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6) Big Foreign Retail will increaseprices to consumers.


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It will increase prices


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It will increase prices


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7) Big Foreign Retail will displaceexisting players, not create new.


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It will displace, not create new markets


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8) Multi-brand retail is not just aboutfood grocery, it is about all products.


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It is about all products


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It is about all products


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9) There is massive ongoinginvestment in Retail from within.


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Massive investment in Retail


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Massive investment in Retail


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10) ig Foeign Retils im ct onbuilding supply chain infrastructurewill be minimal.


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Minimal impact on supply chain


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Minimal impact on supply chain


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11) ow should we otect ndisinterests against Big Foreign Retail?


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otecting ndis inteests


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otecting ndis inteestsLessons from Japan:


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otecting ndis inteestsLessons from Germany:


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Nothing is fundamentally wrong


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Nothing is fundamentally wrong


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Thank You

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FDI in Multi-brand Retail Dangerous for India Aug 10, 2011 - EnGLISH