'Retail sector to touch $675 bn in 2016'

The retail industry will be one of the fastest growing sectors in the coming years and is expected to grow to $675 billion in 2016, Nokia India Senior Vice-President (IMEA) D Shivakumar said today.

Citing a study, he said the retail industry, which was valued at Rs $310 billion in 2006, grew to $470 in 2011.

"In 2016, it is expected to reach $675 billion at a CAGR of 7.5%", he said at the Tamil Nadu Retail Summit organised by CII here.

The organised sector, which accounts for three% in the retail industry, is expected to reach 12% by 2016, he added.

"Retail will be one of the emerging and fastest growing sectors in the coming years. Hence, adaptation to advance technology, improvement in power segment, retail space price and improvising on soft skills of retail executives will be the key areas for growth of the retail sector," Shivakumar said.

Stating that there are about 5,380 cold storages in the country with a total capacity of 24.5 million tonnes, he said of the 24.5 million tonnes, 75% capacity is for potatoes, while 96% for the private sector. The capacity of cold chain is 60,000 tonnes.

He said mobile coupons, provision of retail application in smartphones are increasing footfalls in a retail outlet and added some sales in this segment are shifting from "offline" to "online".

Google India-Head, Rajan Anandan said most retailers get 50% of their business outside Tier I cities.

Observing that online businesses are outpacing offline retailers, he said about 800 transactions happen per day while monthly revenue reaches Rs 3.5 crore in an online fashion retail store.

Nine out of 10 retailers in the US are offline players, he said, adding Amazon.Com tops the list with sale of $34.2 billion.