Sunday, May 18, 2008

Traditional Formats united to challenge Retail biggies.


Take a look at this:
Reliance Fresh has a strategy of targeting 3000 households in 2 km area. Catchments and store will offer more than 150 varieties of fruits and vegetables, and along with this lower price and great ambience.

No wonder, independent family run Kiranas, General store and chemists which make up India’s traditional retail universe are reeling under pressure of these retail biggies. They are finding it hard to cope up with the huge margin pressure and betraying customers.

Recent retail forays like Future Retail, Reliance Fresh, More; Chou pal with the best retail practices and technology advantage are posing a threat to the very existence of the mom and pop stores. To complicate further, the MNCs like Carrefour, Wal-Mart and Tesco having saturated their respective countries are now eyeing on India. This breakneck retailing revolution has put everyone in a state of panic. Local provisional stores are dying with apprehension as how to combat big retailers discount, freebies and other attractive customer policies; Retailers are facing hurdle in opening stores across all the state ;and government on the other hand is facing the nationwide protest against big retailers and MNC’s. Customers though winner almost in every case, still have to put all their purchases on hold for weekend or leisure time to visit the supermarkets to avail the discounts and freebies.

In such a scenario, Bhartiya Udyog Vyapar Mandal( BUVM ) has come as a win win situation for all. It’s the biggest national level association of kirana/mom and pop stores. It comprises 17000 state and district level association covering 27 states. The co-operative throughout India is aimed at helping its members to benefit from a common sourcing and shared infrastructure (logistics, storage and billing) platform.
The societies will be jointly owned by some 2000 small retailers in each state. The members would be the ones who own small provisional stores. These shopkeepers would calculate their monthly goods requirement and then approach and negotiate directly with the manufacturers like HUL, P&G, ITC etc.

Such collective buying on one hand will put the society at par with the mall requirement and on the other hand would save the margins that would have been eaten away by the middlemen. Together they will pose a challenge to the big retailers of the country.

I hope it’s going to put an end to all the disputes by putting the local retailers at par with Retail bigwigs and MNC’s.

6 comments:

Unknown said...

preeti,
nice work, keep it up.
regds,
somu

Anonymous said...

Thanx a lot sir. Will try to incorporate more similar work.

Unknown said...

preeti good article once again. congrats. adding one more point in favour of conventional store is less time taken for billing and packing...which is a bane in more no. of large and medium sized organised stores. and customisation is also largly missing in organised stores... meaning, you get what is there and not what you want... bcaz of the buying policies of many organised formats. i think..we have to still go a long way..as indian customers are more personalised.

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