I 100% agree with Mr Andrew's analysation.And I am surprised to see a foreigner making out such a exact grass root level analysation.Indians bargain a lot just because they are not poor,but its an tendency that they developed during the course of time.And this tendency is not just Indian but I would say its an Asian.Lot of Asian country people have this tendency.I found people bargaining for small electronics to big cars like Benz or BMW(Car dealers in US very well know about it.).One big Asian customer phenomenon is that low cost with hight quality. This is clearly demonstrated in many ways.For example Nokia sells more phones in Asia(But in US Nokias are not very often seen with People).Another example to quote is about cars.majority of the Asian commnity in US drive either Toyota,Honda,Nissan...some Asian Brand since they believe they are of good reliability.
Secondly,regarding the small road side vendors and kirana stores,I don't see any threat to their business.Because in US in spite of having huge Walmarts and other large retailers,there are tons of small individually owned stores running successfully and making good money.With huge population and difference in mentalities there are customers for every kind of business in India.
