The Indian Retales

Insights of an Indian Retailer
The Indian Retales
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Author: V. Rajesh
Format: Paperback
Language: English
ISBN: 9788178061924
Code: 9393D
Pages: 190
List Price: US$ 12.00
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Retail in India, especially the modern self service chains has been at the centre of several press and magazine articles. Vigorous debates about FDI, Corporate Chains and the Conventional stores abound in many a forum. However, in spite of all this hype there are very few books, if any at all that examine this interesting sector and the myriad facets and issues regarding it.'The Indian reTALEs' is amongst the first comprehensive books about Indian Retail. Starting off with some deep insights and analysis about the retail scenario, the author moves on to a prescriptive mode detailing various ideas and approaches that a retailer can use to better their businesses. Interestingly, the ideas although presented in a retail context are relevant for several other businesses, namely those engaged in services.Mr. Raghu Pillai, a pioneer and visionary of Indian Retail has written the foreword, wherein he strongly reiterates the huge potential of Indian consumers, their consumption story and hence retail.
Lastly, the author manages to convey his passion for retail and also possibly tickle the readers mind to consider becoming a retailer.

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About the Author(s)

Rajesh is an experienced retail expert who has worked with almost every Indian Retailer in several senior CXO and functional head roles. His association extends to several retail brands like RPG Foodworld, Spencer's, Musicworld. Health & Glow, Metro Cash & Carry, eZone, Reliance Mart, etc. He was awarded the prestigious Chevening Scholarship for a management program in the Leeds University Business School. As part of the program he has trained at Asda (Wal-Mart's subsidiary) and later on also at Makro in the United Kingdom.He is today known as a leading expert on Indian Retail because of his part in the pioneering effort of establishing corporate retail chains in India. He has played a key role in influencing the consumer mindset, with regard to grocery shopping, in a market dominated by traditional formats. His passion motivates him to be a writer, trainer, speaker and mentor. His extensive consumer interaction has deepened his interest in understanding people and why we do what we do. Contact at theindianretales@gmail.com and follow on https://twitter.com/vroffice

Contents

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Foreword by Mr Raghu Pillai
Introduction
Why these tales about the Indian Retail, What to Expect from this Book

Indian Retail & Retail Strategy
Indian Retail—Issues and Opportunities, Entering the Indian Retail Sector, Opportunities in Indian Retail, Basic Retail Model, Strategic Retail Management, Corporate Social Responsibility in Retail, Way Forward for Indian Retail

Creating Customer WOW
Customer Expectations, Time vs Money, Delivering Better Value, Leveraging Events to WOW Customers, How Customers Perceive Pricing in Retail, Using CRM to Deliver Customer WOW, True-Life Customer Stories and Learnings

Offering a Compelling Assortment
Private Labels in the Context of Differentiated Assortment, True Life Customer Stories and Learnings

Store—the Face of any Retailer
Creating a Memorable Store Experience, Store Staff Are Key, Shrinkage & Shoplifting, An Idea to Create a Mobile Store, Store Launch—Similarities to a 20:20 match, Store Launch Experiences, True Life Customer Stories and Learnings

Landmarks and Memories of Indian Retail
India’s first corporate supermarket chain, A Giant Step for Indian Retail, Indian Retail’s first International recognition, Some personal memories

Some Retail Jargon

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Sample Chapters


(Following is an extract of the content from the book)
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Opportunities in Indian Retail
Conventional Stores
There are 14-odd million outlets in the country. The fact that most of them are owned and managed by individuals definitely leads to a poor bargaining status. But the question is: whether it should make these shop owners defensive and apprehensive just because they are not united. Absolutely not.A great example from this same segment of conventional outlets is the medical and pharma stores. These stores have a strong association which is present in every Indian State and is quite active in many of the states. These stores have gone on to prove that numbers can be an advantage if everyone comes together for common objectives. This is possibly one of the biggest opportunity areas that exist in Indian Retail which the conventional shops are not leveraging. Of course, there are several other opportunity areas which can be leveraged by these shops, which will help them match up to the emergence of chain stores.

A Few Ideas to Explore and Implement
Understanding the Advantages: The typical conventional shop has several advantages which if leveraged well would prove to be a formidable competitive advantage. Chief amongst these advantages is the cost structure they operate with. Therefore, conventional stores require a far lesser sales turnover to break even as compared to a corporate chain. As such, they are better equipped to fight on the pricing front by discounting and still make money. The only downside would be in terms of scalability which would enable some cost benefits due to aggregating volumes. However, given the current scenario the cost-structure advantage is in the advantage of theconventional stores and corporate chains would require a far bigger level of volume aggregation to counter that. Lastly, we don’t have clearly demarcated Central Business Districts (CBD) and residential zones. As such, requirements for an “around the corner” conventional store would never cease, at least, in the foreseeable future.
Consumer Expectations: Even with the explosive growth seen in recent year’s car ownership it remains much lower than in the West. Take the case of dual-car ownership and the situation is even bleaker. Driving to a store, while juggling various other chores and duties would always be a challenge. Therefore, conventional stores offering good value in the immediate neighbourhood have a competitive advantage in terms of location.

Nowadays, 24/7 is a lifestyle most working couples are embracing if not by design then by default due to the pressures of work. This has redefined the priorities and preferences in a significant manner in most cities. Free time is precious and people choose to spend it in recreation and entertainment instead of engaging in activities that are boring, routine and stressful. With the initial novelty of a supermarket store having worn off, the primary value expected from these operators is one of convenience and value. It is a trade off between convenience and comfort vs. savings that will determine the choice of going to a large format vs. neighbourhood
store. In the neighbourhood a conventional store would be better equipped to compete due to cost structures as also the personalised operating style. Coupled with the challenges of driving nowadays,any such conventional store has a significant opportunity that can be leveraged.
Leverage and Enhance Customer Relationship Management: The conventional store has a distinct edge in this area. Not only will this help the shopkeeper to be aligned to customer needs, he then becomes empowered to act on that knowledge. The best example of such empowerment leading to business growth is the neighbourhood medical shops. Most such shops are offering a larger range and slowly morphing into a convenience store. With the value-add of free-door delivery, their range finds a ready-toconsume catchment. I would not be surprised if some enterprising medical stores starts selling fresh produce as many of them have already started selling bread!
Enhance Range: Most conventional grocers today have a fridge and sell milk and a few dairy products as also soft drinks by using this equipment. However, there is scope for such shops to enhance their equipment infrastructure to offer a wider range of chilled and frozen products. In fact, there are many families who shop for such products from supermarket chains and then slowly shift their entire shopping to these chain stores.
On the same topic of offering an enhanced range to retain customer loyalty, conventional stores today can leverage the newly emerging cash & carry format. These large format stores often stock a wide assortment of products and if the conventional stores start carrying some of the extended range of products, especially in the processed food segment, they would be able to cater to more than just the basic requirements of customers.
Collaborative Working: 14 million outlets is definitely a lot,but apparently not because everyone operates as individuals and there is no semblance of any collaboration to leverage the combined buying power as also explore other avenues where a collaborative approach can help create a competitive advantage. Although there are some trade associations, most unfortunately do not seem to be working towards creating competitive advantage by ensuring collaboration amongst the members.
A notable exception is the pharma trade with a very powerful and more importantly effective associations of Retailers and distributors. These associations work towards protecting the rights of their members and are also experimenting with consolidated purchasing as the first step towards collaboration.
There exists huge opportunities if these disparate Retailers come and work together. Some ideas that can be leveraged immediately is consolidated purchasing and negotiations basis a larger volume, have a common distribution centre which would service these shops, combined money power would enable investments in IT which can make the operations more efficient.
Invest in basic IT: The conventional stores should ideally collaborate to invest in IT and make their operations more productive. However, a start is to invest in some basic IT solutions like billing systems. Apart from helping the store in inventory management, this would also help in accounting and managing financials and of course be useful for billing.
Most conventional store owners have a mind block when it comes to IT systems, especially billing solutions. Apart from an inherent discomfort about using computers there stems a fear about tax compliance. The fear might have been justified in the years gone by where it was a complicated and cumbersome process to file income tax or sales tax.
Nowadays this entire system has been made easy and largely transparent. There are self-assessment schemes requiring very little effort and is not a burden to follow. With the VAT and now the GST system in place, filing the returns is the only way any store owner can get the tax refunds for the previous tax paid.
Overview of Basic Retail Concepts to Maximise the Returns: Conventional store owners are masters of Retailing. It is in their blood. However, what they know is typically word of mouth knowledge which is based on past experiences. The world and market place today is changing and changing very fast. In that context these shop owners should attend some Retail training programmes which teaches the basics of assortment planning, store profitability, etc. Coupled with their native wisdom this conceptual knowledge would give them the edge to be more competitive as also might open their minds to experimenting with some of the ideas mentioned earlier.
Corporate Retail
Explore Other Formats: Most of the corporate Retail in India has adopted existing western models like supermarkets, hypermarkets, etc. There are exceptions but not enough of them around. Also, Indian real estate, density of population, lifestyle, etc. are different and might be served better through differentiated formats. An example is from the fast-food industry. Some of the pizza chains typically has a dine in restaurant where one sits down and enjoys a meal, while it also has a tele ordering mechanism as also a small outlet for takeaways only. Same brand but differentiated service and experience while being able to get the same range and quality with regard to the products.
Corporate Retail is only now experimenting with online shopping as an extension of physical stores. But, what about some different physical formats itself; like a store that sells good products for which only the packaging is damaged, at a steep discount?
Explore Other Markets: The lure of the urban shopper’s share of the wallet has been very huge and might actually be the undoing of corporate Retail. Of the 14 million outlets in India, it is estimated that only 1/3rd is in urban areas. Obviously, the higher spending power and density of potential shoppers in urban markets would far outweigh rural markets. But, rural markets have their own potential which is far from being tapped by corporate Retail.
Focus on Maximising Value from the Supply Chain: Retail is all about aggregating the volumes and managing the supply chain. In that respect easy short-cuts of purchasing from the wholesale market would help only up to a point. True competitive advantage can be derived only by examining every possible way of maximising value from the supply chain and the potential to do that in several categories exists.
CRM–Critically Examine the Objective and Purpose: Customer relationship management starts and ends with making the customer feel good and delivering a memorable experience. Of course, a loyalty programme backed by a good IT solution helps. But, that is not CRM and Corporate Retail needs to be aware of this and realign strategies if required. The conventional grocer delivers a very effective CRM which cannot be matched or countered by any software. However, it can be managed and countered by staff at the store. The often unstated benefit and true objective of any CRM programme is to be able to do analytics and leverage the data so generated. If a Retailer is not doing that any spending on CRM isactually a complete waste of money.

Basic Retail Model
There was immense euphoria initially which was soon replaced by the gloom and doom story of Indian Retail. Both reactions are extreme and do not reflect the reality. Many Retailers have quietly gone about their business regardless of the sentiment and media noise. This is possible if one follows some basic tenets and principles.It’s all about location. The clichéd statement most Retailers would reckon is that there are three important success factors in Retail—location, location and location. However, location by itself is not a guarantee of Retail success. In fact, there are several stories about the blind obsession on getting a good location during 2007 and 2008. The only people who benefited from this were the landlords and realty players who saw the rentals go through the roof to levels that were not sustainable by any Retail business. Then the obvious question is whether location is not important?The answer lies in understanding about a basic Retail model and realizing that although location is crucial to success, location by itself does not guarantee it!Essentially shopping is a habit and any new store needs to provide a compelling reason for the customer to switch from one store to another. Otherwise, the law of inertia would not offer any scope for a new Retailer to open in a locality where similar stores exist.

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R e v i e w s


Review in Hindu Newspaper
by msgupta, 02/11/2011, 12:28 PM GMT
R etail in India has been a topic of much debate. However, there are not many books that explore the sector intricately. The Indian Retales is amongst the few comprehensive books that provide deep insight and analysis about the myriad faces and issues regarding the retail sector by an author who has spent a lifetime studying and working for the sector.

The Indian Retales – Insights of an Indian Retailer

V Rajesh

Book Review in Times of India
by msgupta, 02/11/2011, 12:19 PM GMT
http://epaper.timesofindia.com/Repository/ml.asp?Ref=VE9JQ0gvMjAxMC8wNy8wMiNBcjAyNjAy

A Good Value for Money
by msgupta, 02/11/2011, 12:03 PM GMT
Finished reading the Indian Retales over the weekend. I liked the book because the language used was simple and even though not meant to be a text book on retail, it has enough take-aways and learnings for someone like me who has not been into retail but is deeply interested in the sector. The personal anecdotes interspersed throughout the text made it interesting by giving a real-life example to the theory - even though in some cases the examples were repeated.A couple of things that may be considered for the next edition: In the section on customer loyalty, a mention can be made of techniques such as RFM that add more dimensions/parameters to estimating customer loyalty than just frequency of purchase. By adding photographs (where possible) in the jargon section, it will make it easier for readers to visualize the concept.Overall, a good value for money book.

Pradyot
Associate at Diamond Management & Technology Consultants

A fine book to Read
by msgupta, 02/11/2011, 12:02 PM GMT
The INDIAN reTALEs gives a very good insight into retailing in India with some thoughts of history coupled with a very detailed coverage of the fundamentals of retailing.
Well done and I wish you every success with its circulation.I can well remember out last time together and it is heartening to see that you have moved on to greater success.

Mr. Owen Price
Retail Veteran, Former CEO of Woolworths, Former CEO of Dairy Farm and Former Director of Dairy Farm International Holdings Ltd.
Singapore

Excellent Book
by msgupta, 02/11/2011, 09:11 AM GMT
Dear Rajesh,
I have completed your book. To begin with, let me thank you for writing such a wonderful book! I read it like a novel and this is the beauty of this book. Reading this book was like a guided tour of the world of retailing. What makes your book more relevant and different from other books is that you have not lost sight of the unorganized retailing. In fact throughout the book you have made contrasts and comparisons with the local stores and their practices. It is important to do so because this is where the competition lies for the moder format stores. Prominent textbooks on retail management completely miss this aspect. It may be OK with American and European authors doing so because their economies have a higher share of organized retail but what makes me feel sad is even Indian authors, while writing textbooks on retail, talk about orgaized retail only which has about 5-6% share in India.
True life customer stories and experiences in your book are great sources for insight for real-life decision-making. I specially liked the store launch experiences and 15 litre cooking oil packaging situation.
This book would definitely be a part of our library as an important reference. I am sure our students would benefit from this.
Wish your book great success.

Dr. Harvinder Singh,
Asstt. Professor,
BIMTECH, Greater Noida

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