With real estate cost mounting, India's retail sector and it's road ahead is likely to evolve in a different way. Noel N Tata, vice-chairman of Trent and managing director of Tata International Limited; Arthur Segel, Poorvu Family Professor of Management Practice in the finance department at Harvard Business School; Sid Yog, co-founder and managing director of The Xander Group Inc; Rajiv Lal; and Stanley Roth senior professor of retailin at Harvard Business School in an exclusive panel discussion with CNBC-TV18 share their outlook on what lies ahaed for India's retail industry.
Below is the verbatim transcript of the discussion with CNBC-TV18's Shereen Bhan. Also watch the accompanying videos.
Q: Pre 2008 everybody was talking about the retail rush, post 2008 people are now beginning to talk about operational efficiencies, cost savings, operating margins how optimistic are you that we have learnt the lessons pre 2008?
Tata: The retail business is a wafer thin margin business its own right and it is all about operational efficiency, getting the right real estate and the right place at the right cost. Being mainly a private label retailer at Westside you were really forced to build your backend or a supply chain along with the frontend because you were responsible to produce the product as well. So, in that sense nothing has really changed for us. On the hyper market business we are growing the frontend supply chain in tandem.
Q: How important is foreign direct investment in this sector? This has been an issue that's been going back and forth now for several years in this country. We have had several inter-ministerial consultations taking place. We understand that we are close to a draft Cabinet note as far as foreign direct investment into this sector is concerned. What are your thoughts? How important is FDI in to the retail sector, into multi-brand retail?
Tata: To be honest, retail really needs to be looked at as various sectors. Retail in food and growth is extremely different from retail in cars or retail in electronics. The FDI will vary depending on the sectors of retail that people come into.
Q: We are talking about the lessons that we have learnt post 2008 as far as retail business is concerned