Tuesday, July 3, 2012

Multi-brand FDI to hit kirana shops.

It is not just small traders and kirana stores who are worried over loss of business if foreign direct investment (FDI) in multi-brand retail is allowed. Even international chains such as German retailer Metro Cash & Carry believe that the reform move may impact local businesses.

While the influx of international retail giants will bring in investments in backend and supply chain management , the Indian arm of Metro Cash & Carry said this will decrease the importance of small traders in the country as consumers would shift to large format stores from the local kirana shops.

"Consumers will shift to large format stores, so the relevance of small traders will decrease. Because of substantial increase in disposable income due to a growing economy, the focus has today shifted from small to large format stores," said Rajeev Bakshi, managing director, Metro Cash & Carry, India. 

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