The retail sector in India has witnessed a revolutionary growth over the past few years. It was estimated to be at $325 billion in 2006 and has been declared as one of the fastest growing sector of Indian economy by Springboard Research. The Springboard report further stated that after real estate and human resources, IT was the highest investment area for most large and medium sized retailers.

Vendors are no doubt falling all over themselves to secure a spot in the hearts and wallets of customers through glitzy retail outlets in malls and other high-density localities. With the entry of big names like the Tata Group's Corus, HCL's Digi-Life, Sahara's IT Junction or Pantaloon's e-Zone in the IT retail arena, it is evident that retail is now fair game for anyone who can afford to invest in real estate, inventory, manpower and handle overheads over a period of time.

Some of the players in this game are the channel partners. They might not be able to match up to the likes of the giants, but as the recent World Cup underlined, the minnows can sometimes beat the sharks. This is precisely what is happening in the retail business. A lot of business is being routed through the smaller retail shops run by the channel, especially in smaller cities. In fact Sanjay Agarwal, Director of Kolkata's Berlia Compu Systems feels that retail is the future of IT trading. “The market dynamics are changing undoubtedly and the need for retail has developed. The vendors have also become more aggressive and are encouraging retail sales. The whole-selling or similar trade models are going to fade away gradually. There will be only manufacturers and retailers in future.”

Whether his ominous prediction will come true or not remains to be seen. But Agarwal's peers share a similar belief that retail is the place to be. Kamlesh Jain, CEO of Bangalore-based Premier Computers noted that retail as a sector is poised for an even more rapid growth in future. Probably even more than what Springboard Research predicts.

Early birds
One reason why retail business has taken off in India in the past couple of years is because the average disposable income has increased and customers are now willing to pay a price to own a brand of their choice. Keeping up with this outlook, IT vendors have also dropped prices to play catch with the improving demand. This has further propelled customers to buy IT products and set the ball rolling for retail business.

And several partners saw this emerging business early and invested in it to gain the first-mover advantage. Mohit Hegde, CEO of Bangalore's Creative Infotech is well-known in the city's IT circle as one of the oldest retailers in the business. He noted, “The recent surge seen in IT retail sector is due to the increased buying power of the Indian consumer, besides an increased demand.”

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