The Detail - Retail: Need of the hour


By

Prof. (Ms.) Gurleen Arora
Sr. Lecturer-Marketing Management
Suryadatta Institute of Management & Information Research
Suryadatta Education Foundation
Pune-30
 


Introduction:

As per the news article in Midday dated Sep 28, 2007, Reliance opened its Reliance chain "Reliance Fresh" in Mumbai in a very silent manner after facing the resentment from UP & Orrisa.

For general public, it can be spanking new breakfast news and for the competitors of Reliance it can be yet another happy moment as the prevalent conditions are not in favors of the Giant.

But what is the actual story all about? Why Indian public is always on resentment towards any new change? That is the issue of discussion.

The Story so Far:

The retail stores are not a new entity, they have been in this world from the early 50's and in India they have been showing their presence in the form of departmental stores, cooperative societies and in their different formats many a times like KVIC, Kendriya Bhandars, mother diary, Amul, Apna bazaar, Bombay bazaar etc to name a few.

Until unless it was a public venture, we had the feeling of being in the "safe hands" but as the situation turned and the dice went in the hands of the private players, the resentment started.

There are the political parties who say that the Giants like Spencer's & Reliance fresh are a threat to the existence of the small players let it be a convenience store owner, or a hawker. But if a question is put forward to them, I am surprised what their answer will be? How come the threat to the existence is only in the sector of Food 7 grocery retailing? In India the retailing or in other words the beginning of the chain stores is honored to Raymond's followed by Reliance again with their Vimal Brand. Were they not acting as the threat for those who were dealing with the textile industries, of the garment shops?

If we go in the past and check out the news releases that followed this surfacing, majority of them have talked about the development of a new epoch. Then why are we creating a chaos on the development of retail sector in the food & grocery section? Why to consider these Giants as our enemy?

The Valued Retailing:

Being a marketing person, I never ever forget the definition of the marketing that goes on like "marketing is raising the standard of living of the society" and to my perception the retail marketing is not an omission to this. If we just have a glance at our own living standards, we cannot deny this fact that our preferences have taken a flight from the personalized services to the home delivery concept to the experiential shopping to the credit facilitation provided to the online ordering of the items and the ample after sales services to add on to the band wagon.

With all these value addition that the modern retail sector has provided , the bargaining power of the consumers have also increased and we want the Best deal for even a single penny that we spend. Then where the problem lies? Why is our retail sector alienated in to two parties? On one side we have our own small retailers who have always been serving us since our birth and on the other hand are the innovators who had made this selling of things, groceries into complete shopping experience. Actually if thought from an open perspective they are not the two entities rather the two sides of the same coin.

The underlying problem is the threat of existence of the small retailers as if the big monster of organized retailing has captured all the store traffic and can even make the conditions worse for the small operators. At this stage, what is expected from the organized participants is that they come forward & join the hands together & redesign their marketing Mission statements of not only acting as the sentinel for the customers needs & wants rather will also act as the armament (shield) towards the verve of the unorganized sector players.

Here comes the societal marketing role of the giants. If the problem is to be solved then the few of the ways that can be thought of are suggested underside.

Ms. Mayawati said that all the actions are taken keeping in mind the safety & security of the unorganized retailers.

Then why don't we allow the organized & the unorganized retail sectors to mingle together & follow the Barjatya's theory of "Hum Saath Saath Hain". In another words if the vertical Integration takes place between the small & the big organized retailers then it is possible that the off-putting atmosphere will change & the fragrance of the Synergy will flow in the market.

Few of the suggested moves:

1. Hiring the players from unorganized sector by the organized sectors:  The big giants should take these small & local retailers as the member of their store team at an appropriate designation, so that even their SOL can increase & consequently the threat feeling can be taken off.

Not only it will be an advantage to the small players rather than by this the large players will also get an advantage of the prior experience of the retailer as he has been dealing in the same area.

Besides this, he will also increase the store traffic by calling on his loyal customers to the organized formats and thus give them the advantage of well planned shopping.

As the retailer is well versed with the prevailing system of the market, the current situation, new products entering into the market so the cost that is generally incurred by the companies to train the work force can be effectively & efficiently reduced.

2. Moreover having the plans of treating the small unorganized retailers as the Franchisees will also help in conflict resolution as well open the doors of the advantages of franchising for the big giants.

3. To add to this, the companies can also give their Private label brands to the small retailers to sell it to the common public. This move will allow the small retailers to retain those customers who were moving out in the search of the branded products outside, now they will get all of them at their door steps.

Not only that, the retailer will now be more motivated to sell the private label branded products to the customers as they to a great extent will also increase their brand equity. Undoubtedly it will also help the big companies to seek the potential customers easily i.e. helps in expansion.

After reading this,  the readers might feel that all these moves are not applicable as if these small retailers become a  part of big retailers then the service level will decrease as the same persons will be there. Or the performance can decrease or eve that it can hamper the image of the giants.

If we look at these moves from a customers perspective then all these view points can be stated correct but if we think from an Indian perspective, as a citizen of India we should realize that on one hand the development of our nation is there and on the other hand the living & the earnings of the small retailers is at stake.

The retailers have always been, are and will always be the most important movers of the Indian economy. But if the present situation of split continues then the loser will be none other than our motherland-India.

So besides criticizing the moves, we should all should club together and draw out few ideas that can change the retail scenario in which all are equal the profit to all which will then again lets say proudly say along with Shahrukh, Dhoni:

"CHAK DE INDIA"
 


Prof. (Ms.) Gurleen Arora
Sr. Lecturer-Marketing Management
Suryadatta Institute of Management & Information Research
Suryadatta Education Foundation
Pune-30
 

Source: E-mail October 9, 2007

          

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