The transition from the friendly neighborhood kirana stores to supermarket chains, specialty stores, hypermarkets and discount stores promises to change the face of Indian retail industry. Which retail formats are likely to attract customers and maximize revenues? The author tries to answer the question.
Evolution of supermarket chain as a wider choice option, relative to the traditional
convenience stores, is quite familiar. The convenience stores—with limited
shelf space and focus on fast-moving items—offered limited choice. Lured
by a bigger basket of products and wider choice of branded offerings, customers
easily latched onto the comforts of no-frills, self-service supermarket shopping.
The concept of enabling a better `shopping experience' can be traced to the spread
of a supermarket culture, which attracted customers from a larger geographic pocket.
Department
stores stock a deep collection of a wide range of emerging and new product categories.
Perceived higher value by customers (unhurried shopping) and providing better
ambience by retailers brought about remarkable transformation in the way retailing
went higher up the value chain. Non-core offerings became as important as merchandise
being sold at the outlets. The implications—real estate angle and services-products
combination became critical for viable operations. Institutional funding, professional
approach and sales-per-SFT yardstick entered the retail lingo. Vertical expansion,
effective display patterns, integrating display plan with customer flow through
the outlet and personalized service began to assume importance.
Discount
stores are scaled down (stock less upmarket products) versions of department stores,
located in lowcost areas. They have relatively wider range and smaller collection.
While bulk buying aids them in selling at lesser prices, recourse is also taken
to source seasonend products and manufacturers' `seconds'. Target and Kmart are
examples of this format. |
