Retail Dude

From the outside what looks like a crammed neighborhood, opens up to a huge field with a fete-like commotion. Once known as Mumbai’s Shor bazaar, later rechristened to Chor bazaar(a.k.a. Jumma bazaar as referred to by natives), comes alive in the wee hours of Friday. Chor bazaar (thieves market), is one of the oldest (150 years) flea markets in the country. Though, its former name Shor bazaar, still befits its noisy chattering of sellers and even noisier buyers.

Accompanied with a friend I enter the market much before the dawn breaks, as suggested to us by some frequent visitors. It was really difficult to see much amidst the hullabaloo and the dark of the early hours. Slowly as it shone upon us, we could to see more than a hundred traders, offering anything to everything that could fit on the mat (mostly made out of old newspapers) upon whi

ch the stolen goods were kept. The first sight was that of umpteen mobile phones, ipods, mp3 players, transistors, audio cassettes,and others going back as far as gramophones and their LPs. Then there were other electronics ranging from televisions, both new and old (including an LCD), washing machines, computer monitors, laptops, juicers, mixers and grinders, irons et al. Then there were jeans, trousers, shirts, lowers, uppers of any brand you could name along with a good pair of sho

es to go with them. There were watches, sunglasses, a huge array of antiques, jewellery, household crockery and cameras.

Anyone new to the place would have been overwhelmed. So were we and hence started looking out for some good bargains. Obviously, it’s hard to hold yourself back when there are Nike shoes on offer just for Rs40 and Rado watches for Rs 120. Your ability to negotiate with the vyapaari decides how much and how fast you can buy. It is advisable, though, to start bargaining only once you have decided on what to buy. It is always helpful to carefully inspect the good before buying as no product from the Chor bazaar comes with any kind of guarantee. We were lucky to get our hands on some unseen goodies. The first purchase was an antique compass in a classic wooden case covered with plush velvet on the inside. The next was again something from yesteryears. A table top three dimensional timepiece which came with additions such a metal piece which looked like a sword only with it’s tang, along with a few other baubles, all in silver. By the time we moved on to our next and as it turned out the last buys, the sun had risen and things became quite visible. Lastly, we got two wrist watches, both from acclaimed brands. All this within Rs 300.

If you happen to visit Mumbai do take some time out on Friday early morning to experience the madness at Mumbai’s Chor Bazaar. Be sure to carry a torch and an empty bag to amass all that you buy.

- Vivin

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The annual AT Kearny GRDI report ranks the 30 top retail destinations across the globe based on its growth, risks and markets. The ones mentioned are a few of several other parameters. India slips to third spot after emerging as a leader last year. Shuttling back to the top spot is China going all out to grow its confidence to the world retailers. And a surprise entry at second rank is Kuwait.

India today is considered as a mature market where there has been significant growth and now can only has to sustain its growth. Although there are tough challenges that lays ahead, retail in itself is undergoing a consolidation process of its own. If the economic downturn brought some sense into the retailers, there is still a lot of sensibility that has to grow in. Having deep pockets isn’t just enough to give you the biggest pie share. Consumers are now used to the buffet of services which the retailer had once used to lure them in the race to grow and now, they are setting up standards of their own. Global standard on sustainability and greening is just piping in more standards. The new taxing systems to be induced will make life difficult even for private labels. The real estate bubble finally went bust and the rentals gave some respite but still don’t deliver on quality space even today. The retailers in my opinion should keep it tight, close and integrated and stop experimenting with formats.

The most preferred way of entry for retailers and consolidation according to the report will be the Tier 2 and 3 cities where the whole focus has now shifted. The mad expansion in the metros is now over; it’s the time for the other tiers that prefer the Hero Honda to the Harley, to get flooded. The retailers propose to tap the bludgeoning middle class population, but they mustn’t forget that they will still be the stricter price and quality conscious customers. I have seen V Marts, Vishal’s and Big Bizaar’s close and cut down floors in these towns. Seasonality of shopping marked by occasions and festivals will be the key to the survival here and so, the franchising model looks as promising which will kick in the go-getters of these towns.

A major challenge to the retailers is the ongoing debate on foreign direct investments, which doesn’t seem to end anytime soon. The Indian Government still bears the fear of compromising their locals’. They fail to understand that high flying brands won’t be much effect but to allow investor groups to retail firms which can make a significant improvement in the Tier 2 & 3’s. That’s what is going to keep the GDP a flyer. Has it ever considered Wall Mart, Carrefour or Tesco to partner in absolving the misery of food grains rotting in the godowns and allow them use their masterful supply chain accomplishments? Not to forget the jobs it would create. A quick look at the FDI index will allow you to measure that access to new markets and building capacity is on priority list of all investors.

Green everything, is the new mantra. I just wonder what future it holds to JV’s, acquisitions, mergers and investments hold as the carbon credit values go under revision. Under strict EU norms and the UN (CDM) the Europeans will reach out to countries which will minimize their carbon taxations. What happens to India as a destination with the entire infrastructure lying haywire? Is a Green Supply chain even remotely possible?

Now, is the time for our domestic retail conglomerates to let go and share some of individual resources and build upon a collectively strong unit, one which is capable of rebounds.

Cheers

Sudip

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Retail was synonymous to word Boom in India before Recession. But like all other sectors, it also felt the heat of recession.

Now when India Inc. is recovering, it again seems to be the sector which is regaining its position with maximum pace. Many retailers feel that Retail was not that much affected by recession. It was only in the month of March 2009 that they felt downturn but from April, again things improved.

As per AT Kearney’s 2009 global retail development index, India’s largely un-modernised retail sector remained attractive to both domestic and international retailers, in spite of government regulations that prevent 100 per cent foreign ownership of retail stores.

We are witnessing inflow of large number of international brands in India. Walmart opened its first store last month in Punjab, and Tesco and Carrefour are also looking for JV’s. IKEA is waiting for Govt. decsion on FDI. Hopefully FDI in Retail will be relaxed in the forthcoming Union Budget.

With all these in place, I will like to ask readers whether they feel that there is a re-boom in Retail ?

 - Rajeev Damani

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Hello Readers,

We have opened our new Poll. Please feel free to give your response. Our new Poll topic is:

“Will Govt. increase FDI in Retail in Budget’09 ?”

Readers can post there views and comments on this topic as a comment to this thread.

Thank You,

-Team : RetailDude

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It was hot summer of Chennai which made me realize of this unique pricing strategy of Cola Companies. Few days back while quenching my thirst in a local cola shop in Chennai, I discovered how these Cola companies have strategically shift there pricing by selling 200ml of soft-drink at the cost of 300ml. I had to quench my thirst by consuming 2 bottles huhhh!!

It was few years back when these companies come up with the concept of “Chota Pepsi” or “Coke” for that matter. They offered consumers 150 ml of soft-drink for Rs.5. It was well accepted by consumers who were use to drink 300 ml. At this point of time both 150 ml and 300 ml (for Rs. 9) were available in the market.

Then after some time they increased the volume and price of small bottles to 200 ml and Rs. 7, though 300 ml was at same price. These companies discovered a new trend in consumers. They realized that still consumers prefer small bottles. This appeared as a great opportunity for them. Bingo!! The result of this we are seeing now.

Finally, these companies are now selling same “Chota Pepsi” or “Small Coke” at the price of “Bada” i.e. Rs. 9. And we without realizing this have happily accepted this. And the price of pet jar i.e. 500 ml has just increased from Rs. 18 to Rs. 20, where as the prices of 1.5 liters and 2 liters have been decreasing or is mostly with some offer like free my can or something. 300 ml bottles have almost vanished from the market now.

Hats Off to the pricing strategy of the Cola Companies who have been successfully able to sell 66% of the product at the cost of 100% almost in a phased manner and making consumer habitual and unaware of the increased price.

- Rajeev Damani

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Microsoft Internet Explorer, the most penetrated Web Browser in market with lion share of 72.2% is releasing Internet Explorer 8 today.

10 reasons why should we switch to IE-8:
1. Speed: MS claims that this new browser will be faster in all respect.
2. Accelerators Feature: It will allow a users to highlight text on a website and choose from a variety of functions, including search engines, language translation or map displays.
3. Private Browsing Mode: It allows to people block ads from companies that track their Web surfing habits across a number of sites, a practice known as behavioral targeting. 
4. Enhanced Security: Will provide protection against malware and known phishing scam sites.
5. Search Suggestions: Will help you to get detailed suggestions from your favourite search providers and browsing history.
6. Compatibility Mode: Allows user to switch between IE-7 and IE-8.
7. Web Slices: Will allow the user to subscribe to frequently-updated portions, or “slices,” of certain websites.
8. Enhances Tabbed Browsing: It will keep related tabs together, a feature from Google Chrome.
9. Favorite Bar and History: Helps user to keep better track of their Favorites.
10.Automatic Crash Recovery: I guess no explainations needed for this feature.

 
And the good news is that it can be downloaded from Microsoft’s website from 9:30 p.m. Indian time, for free by users of licensed Microsoft operating systems.

- Rajeev Damani

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In a move that takes inspiration from Apple and Sony, Microsoft recently announced that it’ll open its own retail stores “to create a better PC and Microsoft retail purchase experience for consumers worldwide.” The software giant looks very serious on this front, that’s why it has already appointed David Porter as corporate vice president of Retail Stores who is joining Microsoft from DreamWorks Animation SKG, where he was head of worldwide product distribution. No word on when the first store will be opened or what’s gonna be on the shelves, but looks like the main reason why MS is pushing so hard is “to create deeper engagement with consumers and continue to learn firsthand about what they want and how they buy.”

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Hi friends, there is a famous theory in retail that a customer shares his good experience with 10 customers whereas he shares is bad experience with 100 customers. By now you people must be aware that I love sharing my experience both good (Rathna Stores post) and bad (Big Bazar) on Retail Dude. Being a Retail Management professional as well as post-graduate, I can’t resist myself from writing whenever I experience extreme of customer service, be it good or bad, though max of time its bad

As the title of post suggest, it’s about me and my friend Pranshu’s’ (same guy who was victim in Big Bazaar’s case) experience with the famous makemytrip.com, which actually took our trip. We made one of the biggest mistakes by booking a ticket with makemytrip, rather than cleartrip, which we generally prefer. As we came into payment gateway of makemytrip, there was option for either credit card or net banking. We chose net banking and proceeded. It took us to our bank’s page where we made payment and after which it was directed back to makemytrip for booking information. This was the time when ‘java error’ occurred and we were not able to see booking details.

This is a very common thing which happens in online booking, I have faced it in cleartrip too. But in cleartrip, their customer care associates calls within four hours and get the thing done. Or else you can easily reach their customer care and get the thing done. But in makemytrip, this is like a big crime which you have committed. We called Bangalore office of makemytrip, which we got from their site. There the person who picked up suggested us that we should call on a toll free number which is only for Airtel users. So, again it was a big crime for us as both of us are not fan of SRK, and don’t use Airtel. So, she gave us a number of Gurgaon and asked us to call that number. It was a STD call for us but we had no other option. We called at that number almost 5 times, each time we were stuck in their IVR where a lady was speaking ‘Dear customer, all our executives’ are busy with other customers. Your call is important to us. Kindly hold the line.’ But though my call was important, it was getting disconnected after every 15 mins of hold. So, we wasted 1 hour and more than 100 bucks in it with absolutely no response. Therefore, we called back the Bangalore office. The gal their said that she can’t help us as it is not headquarter and hanged the line. I was amazed then why this number was displayed on site?? We called her back and asked if we can talk to someone senior in office. We thought that he must have some good solution. That lady connected us with a manger called Mr., Reddy and he was again a confused guy. He first said that the Guragaon number is a toll free, which was not actually. Then he said that all this happened as we used our debit card and bet banking, which is not properly well and so we should have used credit card. I was not able to understand that why they had that option on their site when it was not working at all??

Mean while we were able to catch hold of an Airtel mobile of a colleague and tried reaching their toll free number. We were connected once told all details and that guy was not able to help asked us to hold the line and finally hanged. By now we were completely frustrated, we decided to give a last attempt otherwise we will either go their office or will forget this booking and book with cleartrip. Luckily after 30 mins again a gal picked the call, we shouted a lot on her and explained. That gal said that her system is too slow, but she will help us by generating a booking number and we should hold the line. We refused to hold and requested to be online only. She took almost 45 mins to generate the booking number between which I was enjoying celebrations of some party in their call center too. Finally I got the booking number but I was said that confirmation of ticket will take 24 hrs. We are still waiting for the same.

I guess it’s high time and company like makemytrip should realize that they are in service sector and people intensive industry. So, they need to hire more as well as talented customer care executives and should render proper customer service. I still expect bad service from call center people but how people sitting in regional office can behave like this??

- Rajeev Damani

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A very Happy Republic Day to all our readers from Team Retail Dude.

This day for some years now is as synonymous with Big Baazaar’s “Sabse Sasta Din” which has now been revolutionized by increasing the number of days and other retailers following the same value sale for us Indians. But Value Retailing is usually a function of the frequency of the inventory being cleared by the retailers. The faster, the better.

2009 as we all know holds the adjective ‘downturn’ plaguing almost all sectors.But for retailers these are hard times to come, since they are at the end of the value chain. Organised retail is expected to reach $43.8 billion in 2009-10 compared to $7.5 in 2007-08 and clearly value retailing will be the growth driver. The retailers have a cut out task to create events for consumption and to make the consumer feel satisfied by making him feel, he saved money.

To quantify some recent events and news, Big Bazaar conducted an event called Flag Sales where prices for some 10000 SKU’s were slashed in Mumbai. Red flags were a 50% discount followed by Yellow (33%) and Green (20%). The stores appreciated an increase of 35% in sales. This was followed by the “Great Indian Shopping Festival” across formats with assured gifts in all purchase and now the “Sabse Saste” days. Clearly they are the forerunner of such events. To recall some more events which garnered value, was Trent launching an entire new collection under the tag “Fashion Yatra” to cater to the low income groups. After Maruti, Mahindra’s it was Tata’s who made headlines opening by their pre owned car business ‘Tata Motors Assured’ launching their first store in pilot basis across 15 cities. Infiniti retail launched “Croma Zip” an outlet which will only host fast moving goods in the shelves identified by the merchandising team. This is surely an effort to reduce the store size, maximize sales and increase margins. Croma also have now introduced their own private label as well to keep up with the margins. As most of us have been saying Private Labels will be another driver which will boost value retailing in the coming years. Even MNC’s have not discarded the idea of Value; Pepsi recently announced the launch of “Nimboo Maarke” flavor to be added to their Tropicana basket, which will be the lowest priced item in it, targeting lower segments and will rely only on volume sales. Surely this a glimpse of Value Pricing. But at some point there has to be a drawn line to ensure that the brand value is not eroded.

To increase Value proposition, Hypercity has now a “No Questions” return policy in place within 14days of purchase. As rightly quoted by Rajiv Nair (Hypercity) that “Value pricing can’t be the only USP, retailers must look beyond.” In fact international retailers like Walmart and Target have leased out excess space to McDonald’s and Starbucks respectively which again a brilliant way to cut costs from the retailer perspective and increase footfalls.

Thus the magic mantra for the retailers would be to grow more value for their own assets and increase value to the customers spends. We are sure to see many new initiatives in the months to come from our retailers, so we better reserve some cash for the best. After all, we know now that VALUE is the KING.

Cheers!

Sudip

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I got into an interesting debate with one of my friends, about how EMI’s are partially responsible for the current recession, and how they are like worms for the economy. Not having reached any specific conclusion, I have decided to throw the debate open to all the Retail Dude’s, Let me hear your views about EMI, is it or is it not the real culprit. Use the comments section.

Cheers!

- Sarthak Taneja

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