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 Activity No: 1

Question: 1

What is overall contribution of retailing industry in Pakistan GDP?

Historically, the retail scenario in Pakistan’s major cities has been dominated by a large number
of small sized retailers. Retail clusters like Azam Cloth Market, Hall Road electronics market
and Hafiz Centre computer and cellular phones market in Lahore are duplicated all across the
country.

According to Neilsen, the distribution of kiryana stores per thousand populations decreased
during 1992-2002 whereas that of general stores rose over the same period. Moreover, the
combined share of kiryana and general stores is expected to decline to 50% in future years. On
the other hand, departmental and superstores are gradually replacing traditional small stores.

More recently, a number of international wholesalers like Makro and Metro have established
large centers within the country and are operating successfully. Such evidence, therefore, points
to the decline of traditional stores and small retailers and the shift in consumer preferences in
favor of large departmental stores, supermarkets and wholesale centers.
Retailing sector contribution in Pakistan GDP:

According to statistics from the Pakistan Bureau of Statistics for the years 2011-12, the retail
sector is worth $4.2 Billion, which represents around 18% of GDP. There are approximately 2
million retail outlets in the country. Out of these retail outlets, nearly 800,000 outlets represent
FMCG channels including 'kiryana' stores (mom & pop), 'pan' shops (kiosks selling betel leaves
and cigarettes), department stores, medical-cum-general stores and the like.

From $96 to $133 billion

Between 2011 and 2015, the size of the retail pie in Pakistan jumped from $96 to 133 billion, a
38.5% increase in four years.
18% of the total GDP:
Pakistan's retail sector is the third largest contributor to the economy and accounts for 18% of the
total GDP.
Employs 16%:

The sector provides jobs to more than 16% of the total labour force.

$152 billion:

The current value of Pakistan’s retail sector is estimated to be $152 billion.

This is probably why the (traditionally dominant) number of new kiryana stores that have opened
is less compared to the growth in the number of general and department stores, supermarkets and
hypermarkets, between 2000 and 2016. One possible reason is that young people are less keen to
buy from street merchants, vendors and hawkers, and prefer modern, destination-oriented stores.

The other trend disrupting traditional retail is e-commerce Zain Suharwardy, MD,
Daraz.pk.Although still at a nascent stage, internet retailing is expected to become a significant
complement to brick-and-mortar grocery and non-grocery retailing in the coming years.

Reference: Aurora.Dawn.com

Author: Ayesha Shaikh Updated Dec 12, 2017 09:52am

Question#2:

How much retailing help and contribute in creating jobs?

Achieving full employment, decent work and sustainable livelihoods is the only way to improve
living standards. The retail sector, with its large footprint in both urban and rural areas, has the
potential to create more sustainable jobs in Pakistan, something that is widely recognized as
essential for the country’s political and economic stability. Nevertheless, there are many factors
at play, among them the phenomenon of ‘jobless growth’, a widening skills gap, continual
technological changes and shifts in consumer behavior.
The creation and retention of jobs within the retail sector is based on several factors, not least the
external environment. Political decisions, economic and social factors all have an impact. An
important driver of change in the sector is technology, which will influence online shopping,
reduce shop floor space, increase warehousing and transport logistics with the potential to shed
low-skill jobs but also to create new jobs and careers. .

Retail is a fast paced industry with room for professional growth and development. There are a
number of areas Service leavers of all ranks can specialize in, which makes Retail a great career
choice. Retail is not just about the front line positions in Retail Managers, Retail Assistants and
Checkout Operators Like industry, Retail companies need many people; driver or warehouse
operatives as well as other areas of business logistics, personal shoppers, operations,
infrastructure and research to name but a few Retail sector welcomes Services leavers, because
they value the strategic skills, your ability to manage teams and execute plans, ability to be
reactive and flexible.

Retail sector is also the country’s second largest employer, employing around 16% of the
country’s total labor force. If we consider the fashion and restaurant industry of Pakistan,
we can see that this industry has progressed steadily with time as well.

The Pakistani media has played an important role in this regard. If we talk about the food industry, we
know there was a time when homemade food was preferred and restaurant food had taken a back seat in
the regard of demand.
If we talk about online retailing then there are also many opportunity for jobs. In in all over
Approximately 5 million people worked in retail sales. The clothing and accessory sector of the retail
industry is one of the largest. In the clothing retail business, 31% of all workers are under the age
of 24, which is a high percentage of young workers. 29% of jobs in this part of the industry are
only part-time though, helping to account for those “young” numbers many high school and
college students get jobs in this part of the industry after school. Grocery stores make up another
large sector of the retail industry. About 2.5 million workers hold jobs in grocery stores, and
31% of them work part-time. Again, many of the workers in this sector are young 32% are in
their early twenties. There are many types of jobs in grocery retail, but the largest availability by
far is for cashiers, which make up 34% of all employees.

Management, business, and financial jobs make up only about 2% of all jobs in the retail
industry.

Question#3

Increase and decrease of growth of retail industry from previous 2 years?

With the induction of global brands and outlets, Pakistan’s retail sector at present witnessing a
booming and impressive growth. The local retailers are expanding their boundaries to compete
with their larger foreign competitors. In 2013, seven Pakistani brands were nominated for the
first time for the World Retail Awards held in Paris, in which three brands were shortlisted.
Many local brands have expanded and gone global by adopting fast-changing trends. With an
estimated size of the retail market at around $50 billion, the country’s retail sector is growing
faster than its economy.

Today, we find in our cities big shopping malls and hypermarkets and small and medium scale
outlets providing which various different categories of products under one roof. The phenomenal
growth in retail sector bodes well for the country’s economic health, as the sector can create
enormous job opportunities and attract foreign investment into the country by alluring global
brands to the local market.
Trends in the country’s retail industry are quite encouraging, as far as the development of new
retail formats and the establishment of a large number of global chains’ retail outlets all across
the country is concerned

Last year, nine Pakistani companies participated in the Southern African International Trade
Exhibition for Retail Products and Africa Big Seven. This was the move to encourage demand
for Pakistani products under the auspices of the Trade Development Authority of Pakistan
(TDAP). More than 1,100 exhibitors from 43 countries participated in these exhibitions in Sub-
Saharan Africa. The target of the exhibitions was the retail sector with focus on importers,
agents, distributors and wholesalers. The Pakistani companies that took part in the exhibitions
included Mehran Food, Niraav Foods, Dawood Textiles, Softwood Textiles, Golden Pearl
Cosmetics, Crosswear, Unique Trader and Best Clean Textiles.

Statistic gives information on retail e-commerce sales worldwide from 2014 to 2021. In 2017, retail sales
worldwide amounted to 2.3 trillion US dollars and e-retail revenues are projected to grow to 4.88 trillion.

Activity No: 2

Question: 1

Explain Classification and mention 2 examples of each?

Departmental Stores:

Offer a wide range of products to the end-users under one roof. Consumers can get almost all the
products they aspire to shop at one place only. Departmental stores provide a wide range of
options to the consumers and thus fulfill all their shopping needs. Their merchandise may
include: Electronic Appliances, Apparel, Jewellery, Toiletries, Cosmetics, Footwear, Sportswear,
Toys, Books, CDs, DVDs. Example: Chase & ChenOne., Metro cash and carry.

Discount Stores:

Offer a huge range of products to the end-users but at a discounted rate. They generally offer a
limited range and the quality in certain cases might be a little inferior as compared to that of
department stores. Example: Chase Up, MCC etc.
Supermarkets:

A retail store, which generally sells food products and household items, properly placed and
arranged in specific departments. It is an advanced form of the small grocery stores and caters to
the household needs of the consumer. It serves as a one-stop shopping destination for customers
to buy merchandise like bakery products, cereals, meat, fish, medicines, bread, vegetables, fruits,
soft drinks, frozen food and canned food/juices. Example: Imtiaz, Naheed, Farida’s, Agha’s, &
Al-Fateh.

Specialty Stores:

These specialize in a particular product and would not sell anything else apart from the specific
range. Specialty stores sell only selective items of one particular brand to the consumers and
primarily focus on high customer satisfaction. Example: Khaadi, Junaid Jamshed, & Out Fitters.

Convenience stores:

Examples include Shell Select and Stop Shop at Pakistan State Oil (PSO) stations that offer
customers easy access and convenience – an easy stop-and-shop solution while you wait to get
fuel for your car.

Warehouse Stores:

A retail format which sells limited stock in bulk at a discounted rate. These stores do not bother
much about the interiors of the store and the products are not properly displayed.

Example: Factory Outlets of Levis, Fifth Avenue.

Mom and Pop Store (Kiryana Stores):

These are the small stores run by individuals in the nearby locality/neighborhood to cater to daily
needs of the consumers staying in the vicinity. They offer selected items and are not at all
organized. The size of the store would not be very big and depends on the land available to the
owner. They do not offer high-end products and they would carry merchandise like: eggs, bread,
stationery, toys, cigarettes, cereals, pulses, milk and medicines. About two third of FMCG
outlets consist of neighborhood 'kiryana' stores, commonly called general stores, which sell
multiple brand grocery items of daily use. Such outlets are generally owned by a single
individual and managed by him alone or with some help from his family members. The bulk of
FMCG business comes from these 'kiryana' stores due to large numbers, location, convenience
and long business hours.

Reference:

www.linked in.com

Author: Sohail Ahmed

Published on February 27, 2016