Small retailers will continue to rule the Indian market even after the entry of foreign investors as customers in the country do not care about the brand, according to a new study by the Indian Institute of Management, Ahmedabad (IIM-A).

The research paper titled "FDI in India," prepared by IIM-A faculty Piyush Kumar Sinha and presented at the Indian Retail Forum 2012 in Mumbai, said that local customers give importance to effectiveness; rather than brand.

In the research paper, Sinha said, "Retail is a local business and customers give a damn to the brand. It is not only efficiency, but effectiveness that matters."

Figures gathered by the researchers revealed that big names like Big Bazaar, Reliance, Amway and Tanishq individually account for between 0.1 and 0.4 per cent share of the market while small retailers have 98.1 per cent share of the market.

In comparison, small retailers in China and the UK account for 92.2 per cent and 58.4 per cent shares of the market, respectively.

However, the research also stressed that foreign direct investment (FDI) would make the concepts of hypermarket and supermarkets even more popular, and thus local wholesalers and small retailers must improve their stores to continue enjoying higher demand.

In brief, Sinha fully supported FDI in Indian retail sector saying it is a logical and integral part of an open economy.