Effect of ecommerce – Size of Retail Stores in Malls Shrinking

At present, online retail sales amounts to less than 1% of the total retail sales in India. But the ecommerce industry is growing at a remarkable speed. Result: Offline retail stores will continue to co-exist with online shopping portals, albeit in modified small sizes due to the rise of ecommerce.

Size of department stores and electronic retail stores shrinking

As footfalls decrease in malls, property owners are trying to find new ways to attract visitors. And one of the strategies implemented by them is to reduce store size of retail stores to make way for international brands, entertainment zones and food outlets.

According to Think India, Think Retail 2016 report, from 60,000–70,000 square feet, the size of anchor stores has now been reduced to 20,000–25,000 square feet.

“Our focus is to make the malls much more experiential. The key to success is in having the right tenant mix,” shared Pushpa Bector, Executive VP of DLF Mall of India.

While the space of retail stores is decreasing, the space for food & entertainment zones in malls has grown from 8-9% to 15-20%.

Omni-channel retail will grow

Experts predict that the share of modern retail (malls) in the total retail industry will drop from 17% to 13% in the next 4-5 years. And ecommerce’s retail contribution will reach 11% by 2019.

But the future of India’s potential $1,200 billion retail market belongs to a mix of online and offline retail. In the recent times, many ecommerce companies like Flipkart, FabFurnish, Zivame, PepperFry, Myntra and Lenskart have opened offline stores. On the other hand, many traditional retailers too like Aditya Birla Group, and Landmark Group have launched their online stores.

Retailers’ mantra is to get rid of any unproductive space & expenses and embrace the current omni-channel retail trend.

http://indianonlineseller.com/2016/02/effect-of-ecommerce-size-of-retail-stores-in-malls-shrinking/