'Some time back, we had seen a mad frenzy in retail. Now the froth is out,' said Goenka, whose retail chain closed down 150 stores last fiscal.

Facing a funds crunch, another retail chain Subhiksha has not paid salaries to its employees for the past three months and also closed down several outlets.

Faced with a Rs.1.15 billion loss in the fourth quarter of 2008-09, Vishal Retail has also decided to shut down as many as 10 unviable outlets across the country over the next few months to cut costs. It has also trimmed its employees from 14,500 to 8,800.

If the retailers do manage to get together, then it will be the first time such a development would take place in this particular business segment in India.