Is FDI really going to change the fabric of our Indian Retail?
If it is indeed true that 70% of India lives outside of cities, why are we so concerned in letting open a few monster stores in cities?
Cut down to the cities. Being a city girl myself, I would talk about only these here.
Given the fact that most of our populace depends on public transport, and these mega stores owing to their sheer size needing to be located on the outskirts of the city, how many of the complete BPL + SEC C +SEC B + SEC A diaspora do you think would end up going to these stores regularly ?
BPL and quite a chunk on the lower SEC C populace have smaller wallets and practically very poor storage space at home and buy stuff on a daily - weekly basis. This would translate to really smaller packaging or sachets. None of the HyperMarts carry this kind of merchandise.
Owing to their smaller bills and frequency of purchases this section tends to buy from as near home as possible. This means 95% of such buying would happen from kirana stores even if it means there's a Carrefour right around the corner.
Most of out community retail or unorganised retail operates on two key words - convenience and loyalty.
These kirana stores whether its a "Bhauji ki dukan" or a "Pandian Kadai" each have their own catchment (read residents of a few streets around the shop).
Main reason being their
1. Willingness to entertain credit sales (Khata / kanakku/ account book ) which would be settled every month after the customer gets his monthly salary
2. Selling items in very small sizes - imagine selling 'thengai chillu' or 'thengai bathai' instead of a whole coconut. Would any WalMart sell you Rs 5 oil sachets? Hey, and where would we go for buying our shampoos and conditioners in sachets, and the fair visage for Rs 10?
3. Carry specific quirky items in their stock even if it is just for a handful of households
4. Loyalty due to personal touch - the shopkeeper would remind you of buying something even if you have forgotten. Selvam my mom's vegetable vendor calls her up to remind " Maami naalikki amavasai vazhakkai vangama poiteenga paiyana anupparen!" . After this would my mom ever go anywhere else to buy veggies ? No! Never.
Is FDI really going to change the fabric of our Indian Retail?
Well, for the majority of the vaadikkai makkal - they are going to be least bit affected by this, let alone change their habits for some few firangi backed megaliths.
If it is indeed true that 70% of India lives outside of cities, why are we so concerned in letting open a few monster stores in cities?
Cut down to the cities. Being a city girl myself, I would talk about only these here.
Given the fact that most of our populace depends on public transport, and these mega stores owing to their sheer size needing to be located on the outskirts of the city, how many of the complete BPL + SEC C +SEC B + SEC A diaspora do you think would end up going to these stores regularly ?
BPL and quite a chunk on the lower SEC C populace have smaller wallets and practically very poor storage space at home and buy stuff on a daily - weekly basis. This would translate to really smaller packaging or sachets. None of the HyperMarts carry this kind of merchandise.
Owing to their smaller bills and frequency of purchases this section tends to buy from as near home as possible. This means 95% of such buying would happen from kirana stores even if it means there's a Carrefour right around the corner.
Most of out community retail or unorganised retail operates on two key words - convenience and loyalty.
These kirana stores whether its a "Bhauji ki dukan" or a "Pandian Kadai" each have their own catchment (read residents of a few streets around the shop).
Main reason being their
1. Willingness to entertain credit sales (Khata / kanakku/ account book ) which would be settled every month after the customer gets his monthly salary
2. Selling items in very small sizes - imagine selling 'thengai chillu' or 'thengai bathai' instead of a whole coconut. Would any WalMart sell you Rs 5 oil sachets? Hey, and where would we go for buying our shampoos and conditioners in sachets, and the fair visage for Rs 10?
3. Carry specific quirky items in their stock even if it is just for a handful of households
4. Loyalty due to personal touch - the shopkeeper would remind you of buying something even if you have forgotten. Selvam my mom's vegetable vendor calls her up to remind " Maami naalikki amavasai vazhakkai vangama poiteenga paiyana anupparen!" . After this would my mom ever go anywhere else to buy veggies ? No! Never.
Is FDI really going to change the fabric of our Indian Retail?
Well, for the majority of the vaadikkai makkal - they are going to be least bit affected by this, let alone change their habits for some few firangi backed megaliths.
Awesome city girl !!! It could not have been said better ....
ReplyDeleteFair enough. The real numbers though are made up by the chillarai vyabarams right ? Bop rings a bell ? What prevents a Carrefour tomorrow partnering with a local co and open up small stores ? My marketing prof even yesterday talked about end to end service presence for effective market capture and these guys take it to their heart. What happens to poor old selvam then ?
ReplyDeleteWell sai,
ReplyDeleteEven now no one is preventing any big corporate from joining hands with other indian corp. putting in some elbow into opening small format stores . We already have our more than enuf share of rel fresh, easy day, spencers et al . And still have our selvams, thallu vandi veg or fruit vendors
We don't have to give a carte Blanche to 100 pc FDI but allow it with Che ks and balances. I leave all the thinking to guys who are good at that ;)
Posting a comment from UN:
ReplyDelete-------------------------
hi I typed a comment. but not able to post it
anyway this is it.
I heard that these giants will procure directly frm farmers paying a higher price initially. they will even finance their crops.
then, do you remember me telling about the chillie farmers of Ramnand who pledged their crop even before sowing the seeds?
They will became indebted permanently, and could not sell to anybody else - faced bankruptcy and led to so many suicides
The old east india company story will repeat.
but of course this will take a long time. the net will closeand people will be caught unawares
there is a good article in Ananda Vikatan explaining all these
- UN