Retail sector: Documentation the only way to realise true potential

Despite positive growth, market needs proper training and technology.

LAHORE: Despite the rapidly changing shopping trends in Pakistan, the retail sector has yet to realise its true potential that, according to experts, cannot be achieved till the sector is officially documented. 

Apart from documentation, diversification of retail flow towards second- and third-tier cities is also vital for the sector to reach its true potential, which is estimated around $152 billion, according to Planet Retail.

According to Yousaf Jamshed, Chief Executive Officer at LXY Global, an organisation working to streamline the sector, Pakistani retail business is traditionally operated as a centralised entity and only 10% in the business are operating with a global vision.

He stressed that people involved should follow the organisational structure. “I see CEOs of global retailers travelling to other parts of the world all the time,” said Jamshed. “On the other hand, Pakistani retailers want to take every decision themselves. Such an approach demotivates other managerial and lower staff. It hinders growth when people working for a retail outlet cannot share their vision and do not have a say in the decision-making process.”

Another mistake is to work on a ‘push strategy’. Retailers manufacture products without realising market sentiments via surveys. “We make and sell, and people purchase since majority are unaware of what is trending globally,” added Jamshed. “This is why the sector’s market size still hovers around $50 billion.

“Consumers do not understand that they have the power to ‘make or break’ a product. If they know and follow trends, they can push manufacturers to change and alter their products. (non-grocery)

The Global Retail index showed that in 2014 retail leaders viewed, “understanding customer behavior”, “online channel developments”, “recruitment and training” as the three top factors driving the company.

Despite a positive growth, especially in no-grocery retail sector, this market needs awareness, proper training, technology and above all documentation, to know what exactly retail market in Pakistan is doing. “Globally, retail sector contributes around 60% in the economies of developed countries,” Jamshed said, who has helped some international brands pave their way into Pakistan’s market.

International retailers introduced new and improved way of doing business and product diversification. Shopping ‘under one roof’ is the currently trend of the people, encouraging real estate developers to construct mega malls. Chains have changed the whole scenario of grocery and non-grocery shopping.

E-Commerce has immensely helped retailers in reaching and selling their products in second-tier cities, but there too, they have had some issues. For instance, one of the issues retailers’ are facing is lack of trust from customers. Many times customer complained that they were not delivered the product they ordered.

Published in The Express Tribune, April 5^th, 2015.

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