Fresh food retail chains and traditional fruit and vegetable retailers in India

Abstract

There are growing concerns about the likely adverse impacts of recently permitted FDI in retail sector including food, on traditional retailers. This article profiles the traditional fruit and vegetable (F&V) retailers in India, their procurement operations, and analyses the impact of modern retail chains on them. It is found that modern retailing of fresh F&Vs has led to decline in the sales of traditional F&V retailers in India reflected in lower footfalls, lower turnover, and net incomes. Although, entire sales decline can not be attributed to the modern retail chains as other factors like reduced household income, high prices, and recession would have also impacted their sales, the article still finds that modern retail chains in well entrenched markets in India are impacting the small retailers adversely. The article highlights the strategies adopted by traditional retailers to tackle the modern retail chain impact and discusses policy measures to protect the interest of the traditional retailers.