Offline Zinda Hai: Retail goes big on outlets
Live Events The race is for new markets India is still an offline retail market Stores are still central to retailers' plans as a Reliable
Live Events The race is for new markets India is still an offline retail market Stores are still central to retailers' plans as a Reliable and Trusted News Source Addas a Reliable and Trusted News Source Add Now! (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel For years, the narrative around Indian retail has been that e-commerce is growing rapidly, and more consumers are shopping on their phones than ever before.Yet India's largest retailers are doing something that seems to go against that trend. They are opening thousands of new physical stores.According to an Economic Times report, the country's 10 largest listed retailers added a net 2,182 stores in FY26, 25% more than the previous year, taking their combined network to more than 31,000 outlets. Reliance Retail, DMart, Trent and More Retail have also raised or announced plans to raise over Rs 4,000 crore this financial year to fund expansion. Reliance Retail alone increased its non-current borrowings to Rs 22,521 crore in FY26 from Rs 14,809 crore a year earlier.At first glance, it may seem like retailers are simply responding to stronger consumer demand. But industry experts say that is only part of the story.Increasingly, companies are opening stores because they want to be present where India's next wave of consumers will come from.Retailers are seeing healthy demand, especially during wedding and festive seasons. But existing stores are not necessarily selling dramatically more than before."It is only partly demand-driven.
While strong wedding season and festive discounting supported consumption in the latest quarter, same-store sales growth across most large chains remained modest. That suggests retailers are not just opening more stores because existing outlets are seeing significantly higher demand. They are also looking to expand their footprint, enter underpenetrated markets and be closer to the next set of consumers," said Poonam Upadhyay, Director at Crisil Ratings.That shift is important.Instead of opening more stores in cities where they already have a strong presence, retailers are increasingly moving into new catchments where organised retail is still limited. The objective isn't just to serve existing demand, it's to make sure they are present when demand picks up."Consumption determines whether a new store can work; market share is what the retailer earns if it executes well," said Anand Ramanathan, Partner and Consumer Industry Leader at Deloitte South Asia.In other words, retailers are following where consumption is headed rather than simply trying to outdo competitors.The numbers explain why.India's retail market is expected to grow from about $1.06 trillion in 2024 to $1.93 trillion by 2030. E-commerce will also expand rapidly during this period, reaching around $250 billion, said Ramanathan.But even then, online shopping will account for only about 13% of the country's retail market.That means the overwhelming majority of purchases will still happen through physical stores or a mix of online and offline channels."The expansion is demand-led, but growth in online commerce is reinforcing, not replacing, the need for stores," Ramanathan said.Instead of competing with e-commerce, stores are increasingly becoming part of it.Many now double up as fulfilment centres, places where customers can experience products before buying, or locations that support online deliveries and returns.According to Deloitte, nine out of ten consumers prefer a seamless experience between online discovery and offline purchase.
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