India as Destination for Western retailers (PDF)

Inhaltsangabe:Introduction:
The Indian market is one of the key future markets for foreign investors and foreign companies. In 2010 the Indian market is estimated to be as big as the European Union with regard to the number of customers. Moreover, the Indian economy shows solid economic growth since the economical reform started in 1991, and the number of middle class households is continuously increasing. Thus, the purchasing power is rising in India. Hence, the Indian market has huge potential for foreign investment. All in all, the Indian market is a market multi-national companies should not miss because of its future importance.
This diploma thesis focuses on India as a destination for Western retailers. The Indian market is especially attractive to Western retailers searching for markets with huge potential and wishing to explore markets which are yet unsaturated in contrast to the home markets of the Western retailers. Both the Global Retail Development Index of 2005 and 2006 rank India as the top destination for Western retailers among the emerging markets with regard to the risk associated with doing business in India and the market attractiveness. India ranks even before East European countries and rising stars like China or Russia because the Indian retail market combines low market saturation with stable economic growth and moderate political risk.
However, India is a country with a very complex culture which needs to be considered if a foreign retail company plans to enter the Indian market. India is a country full of contrasts and a conglomerate of diverse cultural influences (Penner 2002; Kreuser, 2002). Thus, Indianizing, i.e. adapting e.g. a retail company¿s assortment, pricing strategy and approach to personnel management to the Indian market, is the key success factor for foreign retailers in India.
To be able to succeed in the Indian retail market, knowledge of the unique characteristics of the Indian market and culture is vital. Thus, this diploma thesis starts with an overview of the opportunities of the Indian (retail) market such as growing consumption and a demographic advantage. The diploma thesis also describes the challenges of the Indian (retail) market such as the weak infrastructure and the challenges the Indian culture provides. Based on this knowledge, the second part of the diploma thesis introduces strategic decisions. Necessary adaptations to the Indian market, regarding e.g. dealing with Indian personnel or [...]