Retail Dude

Modern Retailers are totally IT dependent. No doubt that IT has helped Retailers to control their operations efficiently and reduce cost but it has few drawbacks too. Retailers become helpless when their IT system fails no matter whether it is a virus attack, software bug or a hardware breakdown. In spite of precaution and preventive measures which Retailers might have taken to avoid these, they are bound to happen sometime or other. And whenever they happen, it causes risk to their most valuable digital asset – ‘’Data’’.

Retailers now a day’s operate round the clock and take care of minute things due to competition but they put their productivity as well as profitability in stale by not taking adequate measure to back up and protect their data. A study revealed that almost 2/3^rd of the retailers takes a day or more to recover data due to system failure. Just imagine a scenario where a retailer is not able to access the data for last 24 hrs:

• No record of what sold in last 24 hrs.
• Stock matching cannot be done.
• No idea of what to order to keep shelves full.
• Record of new customer added to customer database for the day lost.
• Customer queries etc. for the day lost which will cause dissatisfaction to customers.
• Records of CRM and Loyalty program for the day at stake.
• Sales based incentives of employees for the day lost.
• Cannot verify cash.
• Details of the goods returned by customers lost.

Many retailers back up their servers at HO and also take regular backups. Servers are the lifeline of IT infrastructure and it’s necessary to ensure that they are safe and backed up. But still a large chunk of retailers do back up manually on even don’t do at all! Not all data which an employee is working on is on network as they keep them loosely on desktop and work on them even when they are away from network. As per an estimate almost 60% of organizations data are on workstation and not on their servers. Thus retailers need to ensure that both servers as well as workstations are backed-up automatically.

Frequency of Back-up:

How often retailers backs up data is again an important factor. Though most of the retailers back up every day end of the day, many even wait till end of the week which is suicidal. Greater the frequency lesser will be the loss from such disasters. A safer approach is to have automatic back up few times a day.

Test your DR (Disaster Recovery) Strategy:

Having regular successful back-ups and structured DR Strategy makes Retailers confident that they will be able to recover their data. But majority of retailers don’t even test there DR Strategy once a year also. Retailers need to understand that if they don’t test it regularly than it might not work when actually required, putting all efforts in vain and will put all their data on stake causing huge losses. To be on safer side, they should test their DR strategy quarterly.

Off late, loss of data has become a primary concern for retailers and has significant implication on their finance and productivity. A bad DR Strategy can challenge business continuity of the Retailers whereas a sound one can minimize the risk from such disaster.

- Rajeev Damani

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With the domestic retail market witnessing a gradual revival, mall owners are implementing various schemes in order to expand the sources of revenue generation.

As store vacancies in malls started to swell during 2008–09 in a psychological recession plagued India, developers tried to hold their bleeding noses, trying to look out for additional sources of income to give a push to their operating revenues. Although necessity is the mother of invention, the latter soon becomes a habit and then culture. Such is the case with most promotional or additional revenue generating activity that present-day malls practice on a routine basis.

Major Sources of Additional Revenue

Some of the non-conventional ways in which additional revenues are being earned by shopping centres over and above the ‘fixed rentals from their tenants’ include the following:

Temporary leasing area: These are referred to the vacant stores that are let out to vendors. It could be a fixed kiosk wherein different retailers display variety of merchandise and operate on a rotational basis. Certain service kiosks are also mushrooming at present such as kids play area, tattoo stations, photo stations and spas, among others. Lately, developers are eyeing to rent out their vacant stores for exhibitions as well as small gatherings.

Events: Almost every mall these days has some buzz in the air about an upcoming or an ongoing event. These events were initially conceived as promotional activities, but at present mall marketers use such events as brand building activity. Either ways the idea is to generate extra revenue.

Over the years there has been a steep increase in the types of events that are organized. Categorically they can be demarcated into:

· Mall events such as celebration on Valentine’s Day, Republic Day and such other
special occasions.

· Mall tenant events such as store launch parties, fashion shows by apparel brands and organising musical evening for brand promotion including visits of brand ambassadors, among others.

· Events as venue partner are witnessing an upward trend as mall areas are rented for brand launches, IPL related events, events in collaboration with various television/radio channels etc.

· Organizing corporate social responsibility oriented events that are not aimed at colossal revenue generation but certainly help mall retailers to connect with customers. Events organised in association with NGOs on occasions such as Women’s Day and Labour Day along with free health and yoga camp are picking up pace.

Promotion and Advertising: Different revenue generation activity through advertising are not only meant for tenants but are also undertaken by most brands/organizations. New product launches in a particular store can be advertised through floor graphics, standees and even drop-downs leading to the store. Companies utilize digital and graphic signage like Wi-Fi, Bluetooth and plasma screens to promote their products in malls. In return they pay rental charges, thereby generating revenues for mall owners.

Miscellaneous sources: Other sources of revenue churners could be a range of services such as valet parking, gift coupons and crèche facility, among others in order to create extra revenues for the smooth functioning of malls. Although these are used only by a fixed percentage of people, they do provide an impetuous to revenue generation.

Malls developers, nevertheless, have to keep greasing their elbows and constantly strive to differentiate themselves to maintain a competitive edge. Malls will have to keep opening up innovative ways of revenue generation. This will not only keep the average Indian shopper interested but also withstand economic backlashes in times of restraint. Developers will have to conceptualise, plan and provide for these activities
right from the time they are putting up the pillars. Innovations will age and become habit but constant innovation will keep feeding ‘the mall-ers’ with ‘extra bites’.

Himani Paul
Commercial Manager
SEGECE INDIA Pvt. Ltd.

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Social media tools like Orkut, Facebook, Twitter, Buzz etc. introduced a fun element in teaching. Don’t be surprised I am not going to talk about education in India. Actually these tools helped India to raise its computer literacy rate from single digit to double digit, which is one of the important factor to promote etailing in India. I will give credit to IRCTC & Makemytrip for making Indian consumer more comfortable in doing online transactions, but will appreciate social media tools how they boosted “e” presence in India.

The volume of online sale is still less but this mode of shopping is catching popularity through word of mouth, and retailers are bidding on ecommerce growth. Thus we can see “Future group” online shopping destination as www.futurebazaar.com, “Shoppers stop” virtual shop as www.Shopperstop.com and www.themobilestore.in of “The mobile store”.

By the way India has its virtual stores since mid 90’s, and the players like “IndiaMart” and “Fabmall” now known as “Indiaplaza” are among those who established a stepping stone for ecommerce in India. Now we have many such online shops where you can find anything ranging from furniture to T-Shirts and books to gadgets such as www.homeshop18.com, www.shopmania.in, shopping @ sify, rediff and indiatimes, www.retailsdirect.com, www.indiavarta.com, eshop.webindia123.com etc but they lack leading brands. They have “Your brand dual sim phone” but not a “Philip DVD player”, but with retailers opening their online store things are changing but they still have very limited merchandise on their online shop. I hope soon we can see range of branded merchandise from Levis Jeanswear to Titan watch.

After doing some research I was able to draw a profile of Indian shopper - An Indian Online shopper is a “male” of age between “18- 35”, is a graduated doing job and prefer to shop from its work location. Women still prefer brick and mortar store and don’t want to miss trails and store ambience.

Recently Google also launched their shopping tool for google.co.in domain where you can search your product and can see results from all this online shops. All these things indicating a detour for shopping – an online store – new shopping avenue for Indian Shoppers.

- Prateek Katiyar

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No, my post is not about any upcoming movie of David Dhavan on his no. 1 sequel.  But it is about we Indians who are consistently topping the survey called ‘Global Retail Theft Barometer’. It’s an annual survey which was conducted third time in 2009 covering 1,069 large retailers spread across 41 countries in globe. India yet again topped the survey with Retail Shrinkage at 3.2%.

In layman’s language it means that Rs.3.20p worth of good is shoplifted in India for sale of every Rs.100 worth of goods sold in Indian Retail Industry. We are not only leading the survey but are far ahead of the runners up. The runner up i.e. Morocco is at 1.79% and then Mexico at 1.75% and so on. Taiwan had minimum shrinkage i.e. 0.89%. Indian shoplifters prefer stealing gadgets, fashion product, alcohol, apparel and jewellery over other stuffs as they are more valuable and easy to lift.

I won’t talk anymore about statistics in my post as they are easily accessible on little bit googling but I would like analyze that why are we topping it regularly. Considering our economy and way of working of Indian Retailers, I feel that followings are root cause for such higher shrinkage in Indian Retail Industry:

• Retailers in India are not tech savvy. They do not use latest security systems for Retail Loss Prevention. This is gives opportunity to commit such offence.
• Most of the processes in Indian Retail Industry are still having lots of Manual Interventions. For example goods receiving process at store. Thus employees take advantage of these manual processes.
• Employee theft accounts for one of the major chunk of Retail Loss.  One of the major drivers for them is lack of job security which in turn reduces their loyalty.  Employee engagement & relationship building activities are very rare. Compensation, HR Policies and incentives are not comparable to other industries. Thus employees don’t have long-term commitment with their employers and they don’t mind committing such nuisances.
• Corruption in India has also played role in it. There are so many scams and crime which keeps happening in India and the culprits are not caught or punished severely. Consequently, customers don’t even consider an act like shop lifting as crime only.
• Retailers in India do not showcase their policies on Retail Theft to customers. It could be a good practice to display them at locations like entrance, cash counters etc.
• Shopping Malls and Stores in India are generally too much crowded especially on weekends and space is too less in comparison to crowd.  This gives opportunity to shoplifters to execute their art.
• We don’t have Retail Laws for punishing the offenders of Retail theft in place and it is considered as normal theft. Moreover Retailers are generally scared of messing up with Customers specially the educated class knowingly that they have committed the crime.
• We Indians are innovative and intelligent breed. Before the development of a security system, we find the way to crack it. So, no wonder that we are leading this survey!
• The global recession which has just come to an end is one of the possible reasons for rise in Retail Theft in India.
• Poverty in India is one of the major reasons for consistent performance in this survey.

These are the possible reasons I can think of as of now. I would appreciate any additions/discussions on these 

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- Rajeev Damani

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With only a dozen of malls surviving out of more than 200, I think the picture of Indian malls is fading gradually. This is the scenario of the Indian Malls at present and I presume it will be enough for the readers to envisage what I am going to mention.

It has been almost one decade of presence of shopping centres in India, as the first center appeared in late 90s - Ansal Plaza, New Delhi and since then the expansion really accelerated in 2002 – 2003. In the year 2008 – the year of economic slowdown, the development was less than expected and it is evident due to the fact that:

• 34 centres were opened (whereas 74 were planned for opening at the beginning of 2008)

• 8, 50, 000 square meter GLA (whereas 1,800,000 square meter was expected)

Besides the economic downturn, the problem also comes from the developers and retailers. In order to understand them better, a detailed study of the same is given below:

A.) Developers - The Greed for More

On one hand, it is good to see Indian developers investing and providing excellent infrastructure to the country which certainly enhances the overall image but on the other hand it is disappointing to see the blunders done by them for their own properties. Personally, I believe that a developer can accord to both Residential and Commercials at one time but when it comes to Shopping Centres (SC); they should not fire at their own feet!

The following attributes will give a brief idea of the mistakes done by the developers in past:

1. Poor site selection:

Selecting a location without even analyzing about the primary catchment area is a mistake commonly seen. There are many instances in the country wherein erecting a mall at National Highways has been a failure.

2. Vertical expansion:

This country has seen a lot of vacant malls with multiple floors. The ideal case is to have a shopping center with lesser number of floors no matter even if the size of the shopping center is small.

3. Commercialization Issue:

Poor commercialization is like a house built on sand - it will fall down any day. The first objective should be to position anchor stores in their respective position and second is to attract the vanilla brands by using anchors as a tool. It is also important to note here that with a good floor plan and bad commercialization, things could still work but poor floor plan along with good commercialization may lead to irreversible changes.

4. Lack of professional advice:

It is always better to take professional assistance before the commencement of project rather than after its completion, which undeniably reduces the scope of improvement as well as increases costs more.

5. Design issues:

It is rightly said that easy plans normally work, the more complicated you make, the more difficult it becomes. There are many instances like: the strange floor plans - proving to be a hurdle for the shoppers, no sitting arrangements, unplanned tenant mix – not making a mall a destination, low quality local stores or kiosk and so on that is diluting the overall image of the project.

B.) Retailers – Irrational decisions

The slowdown of 2008 has been a great lesson to the Indian Retail companies; they call it lately as correction! Before the year 2008, the expansions had been enormous but now the buzz is “expanding but cautiously.” After reading the factors listed below, one can certainly say the retailers have burnt their fingers themselves:

1. Juvenile expansion:

Before the downturn in 2008, the retailers used to expand frantically almost in every SC without giving much importance to factors like location, catchment analysis, long term vision, presence of the actual buyers, reputation of the developer and much more. These lead to problem of surfeit for which the retailers are still in distress.

2. Sky –scraping commercials:

During this massive expansion, the retailers were at ease to pay high fixed rentals which resulted in high fixed operating cost. Equivalently, the slowdown had a direct impact on the turnover which landed retailers in a miserable condition.

This resulted either in closing down of unprofitable stores or re-negotiations with the developers to reduce the rentals.

Thus, the term Revenue Sharing was introduced; convincing people of the fact it is a Win - Win model.

3. Brand visibility was more important than store profitability:

The expansion (prior to year 2008) accelerated in the most imprudent manner considering the fact that brand visibility* is more important than store profitability leading to calamity for many!

*For retailers, the numbers of stores are directly proportionately to brand visibility whereas store profitability is the result of high turnover and low operating cost.

4. Poor store visibility:

In order to enhance brand visibility; more and more outlets were opened which lead to poor project (mall) and location (store) selection. This yielded in low turnover and wastage of enormous capital expenditure on every store. The selected locations were so poor that even with the best marketing and information tools; no one was aware about the existence of these stores.

Hence, it was a Win–Lose situation wherein; the developer was successful enough in leasing out his space but not the retailer!

The road ahead:

The coming year will have a lot of consolidation. The existing smaller or vacant malls will either be converted into commercials or will be acquired by the larger players. The commercialization strategy will improve as the developers have seen enough and have learned to reject the worst and select the best. The tagline “everybody is welcome” will no longer be entertained and the landlords will be more selective in case of tenant mix and assigning locations.

Conclusion:

To assimilate the above, complete and professional asset management services are required to assist the developers and to create a good balance between the customers, retailers and the owners. It is possible by correct succession of steps beginning from thorough market research till the designing of the property.

Considering the fact that Indian real estate market has high potential and long way to go; the current phase demands improvisation through professional consultancy and other allied services. It is the time to see how owners employ the best use of these services in future.

And if all this is incorporated, one can hope that Indian Malls can once again be on a path of glory.

-
Amanpreet Singh Banga
Commercial Manager, Segece India, New Delhi, India

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A close look at the technology, which we believe is going to be the choice of a lot of leading retailers. Microsoft has released a new technology called “Surface” which would enable retailers to have virtual showrooms hosted on there display tables, allowing customers the browse and customize options. Have a look!

Original Video: http://www.youtube.com/watch?v=D1IpDStL23M&feature=related#watch-main-area

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CRM (Customer Relationship Management) is regarded as key to the success of any Retailer. Most of the retailers across the globe are investing in Customer Retention and Loyalty Building Programs. In case of a Specialty Retailer who caters a niche variety of product, these can be achieved by well designed CRM Program. But in case of Large Format Retailers like Wal-Mart, Tesco, IKEA or Big Bazaar for that matter, it will not be solely depend on CRM, though it plays an important role. Customers of such Retailers expect Best deal in comparison to others and 24X7 Availability of products. Thus Supplier Relationship Management (SRM) plays pivotal role in success of Large Format Retailers.

SRM is a process which helps Retailer in identifying there key suppliers and integrating them in there business to create a win win situation for both the parties. SRM fills the gap between suppliers and retailer’s understanding of market demand and thus create a win win situation by aligning retailer’s sales plan and supplier’s manufacturing plan together. It ensures that retailers get the best contract and suppliers get long term commitment. Moreover it eliminates the possibility of any kind of dispute between both parties by bringing them on same page in regard to all policies like returns, facing, pricing etc.

The process of SRM can be penned down as follows:

• Identification of potential suppliers based on qualification required.
• Evaluating and selecting suppliers on various parameters like product, price, capability, background, brand etc.
• Entering into agreement with selected supplier in terms of price (term of sale); return policy, ordering policy etc.
• Identifying key suppliers in different product categories based on sales volume and demand of product.
• Selected strategic suppliers will be CPFR (Collaborative Planning Forecasting and Replenishment) Vendors and will have limited access to Retailers Sales Plan so that they can align there Manufacturing Plan accordingly.
• Retailer need to regularly monitor the performance of Suppliers.

In my next post I would be discussing on CPFR in detail

_______________________________________________

- Rajeev Damani

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Dear Readers,

A set of three new rule books for businesses in the country is going to transform and affect a company’s operations. Welcome GST, IFRS and DTC!

GST (The Goods and Service Tax) will be the one whole sole tax that the Government has proposed that will swallow all other indirect taxes that we end up paying. GST will treat as one market in terms of taxation and thereby only a single rate for products. Currently companies pay the central excise duties, the VAT imposed by the State Govt. Not to mention there are entry taxes and interstate taxes that is burdened upon. The proposed date of application of the GST is April 1^st 2010, although it’s almost ready to be postponed for sure as the Centre has a huge task of bringing all the States to the same page. Not to mention that the companies have a hefty back end work that will be needed to complete, this means aligning business documentation, supplier relationships, distribution, compensation policies, loan agreements to name a few. The benefits are major as the GST (proposed to be around 16% - 18%) will significantly reduce the total combined taxes (currently around 35%-40%) that are prevalent today to any sale of product or service provided. Talking about impacts, the first to flash is lowering of prices, this will increase demands. A single price for any product or service across the country which gives consumers a great relief. Talking of benefits to organizations, having regional warehouses instead of having one in every state impacts supply chain costs and capital investments. You will see a real application of the ‘hub and spoke’ model where a single warehouse caters to a lot many states at retail too. A significant change will be lower capital required to match the same level of production owing to consolidating the excise duty in GST.

IFRS (International Financial Reporting Standards) is a new basis of accounting that is more transparent being followed globally. About 100 countries have adopted it, which then makes comparison of statements across companies much easier. This will eventually replace the Indian GAAP structure. Again the adoption date is effective April 1^st 2010. Companies listed and unlisted will now have to consolidate their accounts, not just subsidiaries but associate and vendors they control (GAAP defines it as total control, but IFRS states that it could be partial control or directing activities too) . “Fair Value” accounting is to be adopted where all transaction or entry will be reflected in the current market value. This also means reporting for intangible assets like, manpower, copyrights, brands, patents, customer base etc, therefore a constant evaluation of assets take place. This will result in a wide variance in income and profits as companies will not be able to dump their losses into subsidiaries and associates. It is sure to have a big impact on FMCG, Pharmaceutical and the Automobile industries where a lot of vendors are implied. It’s sure to change a way of business in India.

DTC or the Direct Tax Code is a proposal to take an effect 2011. Under this regime the proposal is to cut the corporate profit tax from 34% to 25% all inclusive including surcharge and cess. The change in MAT (Minimum Alternate Tax) from the current 15% of booked profits to 2% on the gross assets for non banking firms. This simply means a loss making venture also can’t avoid this tax, but the losses can be carried forward too! These rules will even the playing field. Economics and not incentives will decide locations of new units. Tax holidays and Special Industry, what’s that? Location based incentives will be a passé. Special industrial zone status like (Baddi in HP) where a lot many FMCG and Pharma Co’s have their setup without much competitive advantage or Export oriented incentives/ SEZ’s or Software Parks / Infrastructure companies ( Sec 80-1A) rebates that they all enjoyed so far will be flushed out. However 9 businesses have been exempted like oil and gas, SEZ developers, power, cold chain, warehousing, hospitals (in select areas), fruits and vegetables, oil pipelines and infrastructure, as they are considered high risk developments. Although the incentive will on the amount invest and not where they invest.

Overall, the new regime if implemented on the deadlines will affect the way corporate houses do business and in the right way. There will be much more accountability and will be a change in which companies measure its customers. Pushing towards mere financial gains will come hard by. A better collaboration of industries will soon happen and therefore a better consolidation. The customers are sure to laugh their way back home.

Cheers to One India!

Sudip

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Guest Post:

When we say that the market is changing we should ask ourselves who is changing the market? If it is not you, changes done by your company will not yield significant gain.

I am going to discuss changes in market dynamics with respect to introduction of new products. If a company is not leading the product innovation in the market, company is bound to compromise on the bottom line. In such situation the new product will be new to the portfolio of the company only but not to the market. A real new product introduction means surprise to market.

In one of my earlier post I discussed the correlation between new product introduction and market share. I listed some variables like working capital of channel, rotation of working capital and pace of introduction of new products should be properly planned well before laying out the product road map. It seems theoretical but I convincingly suggest to focus on following parameters at the time of introducing a breakthrough product to make sure that the planed gains are intact:

1. Pace of introduction: It is a philosophy of a company’s strategy which defines dynamism and youthfulness. High risk with high returns. If executed properly, it will establish a product leadership image of the company. Every successful introduction will fetch a yield, during its life cycle, much more than the cost incurred in ten mediocre or failed introductions. When we say pace, it’s important to assume the competition will copy it in no time. Pace is introduction of real products in the market, consistently with a motto to surprise expectations of the customer every time. In competitive environment it will give you a first mover advantage with better sales realization and in monopolistic environment it will increase barriers on entry of competition. The pace of introduction can be decided based on the intensity of existing competition.

2. Working capital of channel: Only new product introduction may not give the desired growth. Think this in a way that if cumulative working capital of all the channel partners is constant, the retail will only replace the existing portfolio with new one. This may give better top line because of higher realization from new product but overall volume will remain constant. If a company’s thrust is to expand, the sales volume will increase only with increase of selling capacity of the channel. This can be done with penetration into untapped market. More distributors or more retailers means more working capital. If such distribution plans are in place the real volumetric growth of new products can be assessed.

3. Cycle time: Or the speed of rotation of working capital of selling channel. This is the area which any company in any industry will love to improve. This is also a measure of supply chain performance. With the proposed implementation of GST (in India) we will see a radical shift in collaborative supply chain management with better distribution at lower cost. A longer term strategy on depot and inventory planning in line with product road map and futuristic capacity planning is required.

This is a guest post, the original article can be found here: http://santoshsrivastava.wordpress.com/2009/10/24/surprise-expectation-of-consumer-every-time/

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Dear Readers,

Let me wish you on behalf of the Retail Dude Team a very prosperous year ahead. Let it be a year of change.

With the advent of new modern technology and business methods, one thing that most organization does is to create wealth for themselves. In primitive a few companies did go public and created wealth for its shareholders and gave a handsome to employees as esops which of course strengthened our national economy. But today a new economy has emerged the one of Social Economy where entrepreneurs make a far greater impact to a societal section primarily the disadvantaged ones. Slowly but steadily Social Entrepreneurs are the new wealth creators and I believe they are far more innovative in approach that can be a lesson to the government and companies alike.

But do not make a mistake of realizing that they are just mere charities for they use all modern methods and technologies and yet are not greedy but have a drive of creating a social impact. Some may quote that bigger companies do their bit by funding and resolving issues of the communities so called as CSR, but the prime difference is that a handful actually are sustainable!  I am yet to quote a few notable existences of people who have transformed this picture and yet can find that they have managed to evolve themselves even in the shades of the bigger corporate giants. Almost like a phoenix have created values and wealth from dust.

“DesiCrew” is one of the efforts of Saloni Malhotra who started this venture of a rural BPO in the villages of Tamil Nadu in 2007 and managed a turnover of over 2 crores last year. Not to mention Satyams Gram IT was already in place by then, but today the winds of change have hit Kollunmangudi and created a big social and commercial impact. “Bamboo House India” of Prashant and Aruna Kappagantula realized that bamboo art comes naturally to the tribes residing in Tripura and the fact that most bamboo furniture sold in the country was made in China! After they setup their company, the earning potential through a cultural art has thrived in the region and has a potential to bail almost 5 million people above the poverty line. The bamboo ecosystem also revitalizes the environment, a classic triple bottom line result.

“Industree Crafts” created by Gita Ram and Neelam Chibber (NID) set up in 1994 is another tale of how the modern economics can fortify the rural talent. The chain of Mother Earth stores which stands proud today is no more than a market linkage of the urban demand to the rural artisans. In fact they also managed to bag orders from global brands like Ikea, Crate&Barrel and Interface boosting the lives of more than 350 artisans groups.

Talking of crafts and hand work none can challenge Fab India’s niche and its vast network of over 100 retail outlets.  Set up by John Bissell, today Fab India supports more than 30000 artisans and over 17 small producer / community companies. Through their sourcing of materials, has also boosted cottages industries spread across geographies. It actually recorded over 300cr as revenues for FY09, truly FAB!

The focus is not only on delivery but also on affordable innovation as “D.Light Design”  and “Selco” have done to bring in cheap solar powered led lamps that run up to 12hrs a day with a minimal charge. The innovation also was a hit with poorly electrified states with items like mobile chargers, cookers etc using all but using solar cells. The dilemma and the question that lies unanswered now is that if such technological advances can take place to help the poor, why isn’t it being used as an alternative power/ fuel solution to the urban?

To talk of young entrepreneurs, none match Dr Vikram Akula creating “SKS Microfinance”, which today has disbursed over 3000 Cr as loans to 3.95 million lives. SKS single handedly changed the face of microfinance which even the state owned banks couldn’t do.  Nearly 4 lakh Sangam members of the Company own Kirana or small grocery stores. The Company has launched this project to provide working capital finance to help these Sangam members to buy Fast Moving Consumer Goods (FMCG) and groceries through a dedicated vendor. The Company has partnered with METRO Cash & Carry India Private Limited, one of the world’s most-reputed wholesalers, who deliver 13,000 SKU (Stock Keeping Unit) at competitive prices and standard quality at their doorstep. Insurance is yet another feather which SKS has added. No matter how significant the business idea may be, it is SKS that did lay out the very foundation to carry it out, by economic empowerment through small credits. No wonder that they still have a 99% credit recovery record.

And who can forget the firebrand Ela Bhatt’s “SEWA” which had helped millions break the bonds of poverty in Gujrat setup in 1972 and now into more than 8 states. From financing small rural entrepreneurs helping them earn a livelihood to healthcare, insurance, schooling, eco tourism SEWA has done it all. In fact it also set up Rudi multi trading company a marketing channel for the rural by the rural. Bajaj Electricals uses packaging made by Rudibens. SEWA also broke the national barrier with it importing 10Tonnes of dry fruits from Afghanistan creating a market for them whilst a market for us. Guess where her next stop is? Africa!

Social entrepreneurship describes a set of behaviors that are exceptional. These behaviors should be encouraged and rewarded in those who have the capabilities and temperament for this kind of work. We could use many more of them. We need social entrepreneurs to help us find new avenues toward social improvement as we enter the next century.

Cheers!

Sudip

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