Monday, July 23, 2007

Corporate Retailing

Corporate Retailing

When we use word corporate an image of large industry, a big business hose, a MNC engaged in multiple trades is visualized in our minds. The waves of globalization and world trade are on the high tides and slowly but surely are on the way of taking control of every business and trade all over the globe, India is not an exceptional case, in fact being the second highest populated country is the prime object and field ground for the much desired boom in the sector, A spark can be seen in the eyes of corporate world all over the globe with the pronunciation of the country name. The domestic corporate sector has already started their efforts in the direction of getting benefited from the new way and style of business called “Retailing” and a new term “Corporate Retailing” is spreading it wings to kill the traditional retail markets of the country.

A few days back I got a SMS on my mobile about the inaugural discount offered by newly opened “Big Bazar” a departmental store in the city. I have tried to find out affect of this SMS campaign by the stores, in my friend circle I enquired almost 100 people and almost 90 said that they have read that. A high 60% people responded to it and visited the store though just 4% of the visited people purchase beyond the limit of offer and were eligible for the discount but it is also fact that a sounding high 56% people have spend some money at store for buying this or that. It is the clear picture of working strategy of the corporate houses when it comes to retailing.

Reports says that though in India only every fifth citizen is with the tendency of shopping but even then the retail market is showing a mouth watering annual growth of over 70%, The retail market which was sizing about Rs. 12,00, 000 carores at the beginning of the year 2006, went to touch Rs. 12,80,000 carores by the year end. In fact this Everest growth aspect attracting the corporate sector for an entrance in the retail market beside that some fundamental facts are also favoring their entrance in this non traditional sector of corporate world. India is the second largest in the production of fresh vegetables and fruits [contributing about 15% of fresh Fruits and about 11% of vegetable production of world]. Most of the farmers of the country are from the unorganized sector hence a very huge loss of these perishable food stuffs is the natural thing. About 40% of onion, 60% of Potato, 20% of lady finger, 10% of Banana and 15% of Tomato production get spoiled during the transaction from producer to customer. This might be the reason behind the real huge profit in this trade just imagine for per kg of lady finger we are paying over Rs. 20 but the producing former is getting only some thing between Rs. 4 to Rs. 5, it means there is profit of 400% to 500% which is shared by the City wholesaler, area wholesaler, semi wholesaler, retailer and hawkers.

With the entrance of corporate houses in this field the scene is changing, with the high investment capacities these corporate houses not only can prevent the valuable loss but being a direct buyer and seller can afford to make sure the availability of good stuff and comparatively low price for the end user. The best example which I can quote is the Hapus [Alphanso] Mangoes of Ratnagiri with a maximum life of 35 to 45 days but when Pentaloon entered this market what they have done, they have installed a processing unit there to increase the life of mangoes, so that they can sell these in between 60 to 70 days by keeping them fresh. Aggressive marketing tactics and focused advertisement are the tools which are helping these corporate to reach out to their destination of being undisputed kings of retail sector of market but this is happening at the cost of killing the unorganized retailer who even can’t think of compete ting with these big shots.

No comments: