Via World

Retail Landscape in India

Retailing in India is one of the largest industries with a total market size of USD 320 billion in 2006 and growing at a healthy CAGR of 5%. Rising incomes and increased consumerism along with an upswing in rural consumption will further fuel this growth to around 7-8%.

However organized retailing in India is still very small (just 6%) of the entire retail Industry compared to 70% - 85% in some of the developed economies of the world.

Destination India: the booming travel industry

Everyone in India seems to be on the move. Almost overnight the propensity of Indians to travel within and outside the country has exploded.

The growing numbers of wealthy Indians, an expanding middle class, and the boom in low cost carriers have combined to push domestic and international trips of Indians to an all time high.

International outbound trips by resident nationals peaked at around 8.3 million in 2006, according to a recent report by the Pacific Asia Travel Association (PATA) and Visa International.

Besides Taj Mahal, drawing a multitude of foreign tourists is India's rich cultural and geographic diversity which offers a wide range of tourist attractions and experiences such as leisure, culture, adventure, spirituality, eco-tourism, wellness and health.

International tourist arrivals to India are peaking. Over 4.43 million in 2006, up 13% from 2005 (3.92 million) and expected to touch 6 million in 2007.

If one were to include NRIs visiting India, the total number of international tourist arrivals in 2007 is estimated to cross 9 million.

Conde Nast Traveller, a leading travel and tourism journal has ranked India amongst the top 4 preferred holiday destinations of the world. India is ranked 5 in the Lonely Planet survey of favorite tourist destinations in 167 countries.

Tourism in India is the third largest foreign exchange earner, accounting for 2.5% of GDP. It also makes a direct contribution to the economy with significant linkages to agriculture, horticulture, handicrafts and construction.

The Indian aviation sector has grown significantly since its privatization. With competition lowering fares, the volume of air travelers have gone up dramatically.

Aviation officials expect the number of air travelers to grow from the present 20 million a year, to over 50 million in 2010. By 2020, the number of airline passengers in India is likely to exceed that of USA.

With local and international tourist's population going up, the demand for hotel rooms, across segments, has surpassed supply by leaps and bounds.

Hotels across the country, in the luxury and business traveler segments, are already recording close to 100% occupancy during weekdays, with average room rates shooting up 30-35% and revenue per available room (RevPAR) by 20-25%.

Catering to a flourishing travel industry calls for a strong supporting eco system. Business opportunities will therefore abound for car rentals, taxis, cargo logistics, aircraft maintenance, travel agents, airport security equipment, catering services, pilot training institutes, staffing companies, airport infrastructure and related areas like on-line travel portals etc.

The online travel industry grew at 126 per cent from a base of $295 million in 2005 to $796 in 2006. In 2007, it is expected to record a 66 per cent growth to be a $1,325 million industry and by 2008, will grow at 51 per cent to be a $2,004 million (around $2 billion) industry.

Take for instance, tourist information portals. Today, although the online travel sector is a mere 2.2 per cent of the domestic travel market, it is set to grow from $796 million in 2006 to around $2 billion by 2008.

In parallel, the Indian consumers are getting comfortable using the web and mobile to do their travel related research and planning and thereby becoming more informed buyers of travel products and services.

This trend paves the way for creating new technology solutions that can capture customer interest.

However, unlike in the West, most Indian consumers are not yet ready to complete their entire transactions on-line. Smart entrepreneurial companies will therefore have to find ways to contextualize Indian travel services to capture the new smart buyer who is still Indian at heart.

The Future of Travel and Services Retailing is Here

VIA, formerly EBIX Travels Private Limited (formerly known as FlightRaja Travels Private Limited) is the largest technology based travel services company in India. VIA has silently revolutionised the travel domain in India and brought in value added changes that benefit the customer and business channels. VIA is today the topmost travel company in India with a turnover of Rs. 725+ crore and a growing network of 4600 agents spread across India.

• Geographical Presence

• Inadequate Utilities

• Supplier Backward Integration

• Consumer Insights

• Come Partner with VIA

question1

question1