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Last Updated: Monday, 21 May 2007, 07:10 GMT 08:10 UK
Supermarkets devour Indian traders
By Sanjoy Majumder
BBC News, Delhi

Supermarket in Delhi
Indian shopping habits are changing fast
For generations, Indians have shopped for food and groceries at open markets and from roadside vendors.

But this is now beginning to change as a number of large Indian companies are setting up western-style supermarket chains to cater to the country's growing middle class.

The American chain Wal-Mart is poised to enter India next year and the UK-based Tesco is hoping to follow - all hoping to corner a part of a retail market valued at $330bn a year and growing all the time.

But as Indians change the way they shop, it's also beginning to affect the lives of millions of people who work in the large, unorganised retail market.

The vast majority of them are poor villagers who migrate to the city in search of work and end up selling fresh produce in a neighbourhood market or from a pushcart on the street.

Noisy and colourful

As dawn breaks out, most Indians head out to their local market.

Noisy and colourful, the markets are typically set up in the open air, with only the simplest of protection against the elements.

Most of the sellers squat on the ground, on burlap mats, surrounded by an astonishing variety of seasonal fresh fruits and vegetables.

Spencer's Vice President Samar Shekhawat
It is our belief that people have moved from asking for value for money to paying money for value
Spencer's Vice President Samar Shekhawat

Succulent watermelons compete for space with apples and oranges while in another corner green leafy spinach and fresh mint is piled up high.

Bag in hand, the seasoned shopper moves from store to store as the sellers call out to them.

They stop to examine and haggle before they strike a bargain.

At the end, they walk away with a day or week's supply of fresh produce for the family at unbeatable prices.

This is the Indian retail industry - unorganised, seemingly chaotic but generating sound business.

But now, there are signs of a change.

Competitive prices

Across Indian cities and towns, brand new supermarkets are rapidly cornering a slice of the business.

In the capital, Delhi, India's giant Reliance group have set up a chain of Reliance Fresh stores, selling fresh produce at competitive prices.

But for a sign of the future, I head to the upmarket suburb of Gurgaon and the newly opened Spencer's hyper mart.

It's aimed at suburban shoppers - most of the people wandering through the shiny aisles are professionals - doctors and lawyers, IT workers and bankers.

Mrs Chibber
Here you have a wide variety of goods, everything is available and it's comfortable
Indian shopper Mrs Chibber

On offer is several thousand square feet of air conditioned space with just about everything under one roof - fruits and vegetables, meat and fish and freshly baked bread.

There are also electronic goods, clothes, fast-food counters and a bookstore.

Samar Shekhawat, vice-president of Spencer's, says this is one of eight hyper marts spread across the country.

"We would like to provide consumers a 360 degree solution - the husband can browse through the bookstores, while his wife shops and their children grab a snack at the cafe.

"It is our belief that people have moved from asking for value for money to paying money for value," he adds.

With a wide-range of produce and products, chains like Spencer's can offer competitive prices and it's an experience that's clearly going down well.

Busy New Delhi road
India's economy is growing rapidly

Mrs Chibber is a lawyer and has a family of four. She's shopped in traditional, local markets all her life but now she's made a lifestyle change.

"In my local market, I had to spend a lot of time going to several different shops in the hot sun. And you still may not get what you want," she says.

"But here you have a wide variety of goods, everything is available and it's comfortable. You are not exhausted by the time you go home," she says, as she wheels her trolley towards the check-out line.

Most vulnerable

Even as middle-class Indians are beginning to enjoy the fruits of a retail revolution, it's beginning to threaten many others who survive on the trade.

Indu Prakash Singh works for Action Aid and believes that it is creating a major problem.

"Millions work in the unorganised retail sector. They are also the most vulnerable because they work long hours for relatively low margins. They are being directly affected.

"We have already seen that in places where these supermarkets are coming up, local vendors are losing 40% of their business. What we are seeing is a big divide being created, between the super elite and the poor."

Vegetable seller Mukesh and his family
Mukesh wonders how he will make ends meet for his family

You don't have to travel far to cross the divide. Less than a few kilometres from affluent south Delhi is the sprawling neighbourhood of Sangam Vihar.

It's congested, with houses built so close to each other that they block out natural light.

Dirt-tracks pass for roads where children play amid filth - from the open-drains on either side and the garbage strewn around with flies buzzing.

This is where many of the vegetable sellers who cater to south Delhi live.

Mukesh, a vegetable seller, is slowly wheeling his cart back home.

His day began at four in the morning, when he set out for the wholesale market an hour away by foot. From there, it's another hour to the market where he plies his trade and then another couple of hours back home.

But the past week has been nothing short of disastrous for him.

Booming economy

A brand new Reliance Fresh store opened down the street and he's lost half his business.

"I'm struggling to sell most of my vegetables. Whatever is left over is simply sold at half-price or thrown away. I cannot store them," he says.

He has four children and his wife is worried about the future.

"It's expensive living in Delhi. If we have no money, there's not enough to eat and pay our bills. I really don't know what we'll do," she says.

I ask Mukesh if he can find any other work - maybe even at the supermarket.

He laughs.

"There are educated people in this city who are unemployed. How can an illiterate man like me expect to find work?

"No, I don't think there's much else to do. If I can't make it here, we just have to go back to our village."

There are 40 million people like Mukesh employed in India's unorganised retail industry.

Like him, they depend on daily earnings to support their families. And as India transforms under its booming economy, they're beginning to wonder if there's a place for them in the new India.




SEE ALSO
Wal-Mart to enter Indian market
27 Nov 06 |  Business
Who is Sunil Mittal?
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Tesco ends Bharti talks on India
24 Nov 06 |  Business
Wal-Mart helped by overseas sales
14 Nov 06 |  Business
Tesco talks to Bharti over India
10 Oct 06 |  Business

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