The world around us

Quite ironic this news.

On the one hand, Indian retailers love to crow about how they are the "Wal-Mart of India" but now are trying to distance themselves from such names. Domestic retailers don’t want to be compared to Wal-Mart and other large global firms due to the backlash associated with them. With so much media attention and the PMO asking for the impact of larger retailers is studied, whether they are international or domestic, several large Indian retailers are pointing out that they are not like Wal-Mart or Tesco.

Kishore Biyani, MD of the Future Group, said that the comparison was not apt and that, “The implication needs to be understood in the long term. In terms of size, Wal-Mart is bigger than the total consumption in India. Operating at this scale, puts the company in such a commanding position, that it can even manipulate consumption patterns, something which is obviously not in the best interest of India.”

Wal-Mart’s CEO Michael T Duke is currently in India to get a first hand look at the local retail formats, both the organized and local mom-and-pop variety. In Mumbai, he went to Malad, one of the city’s retail hotspots where he visited Inorbit Mall, Crossword, Spencers, Croma, HyperCity and Food Bazaar. In his visit to Delhi, he was met with lots of protests by local organizations against the entry of the company to the country. He also met Montek Singh Ahluwalia of the Planning Commission and Kamal Nath, Minister of Commerce and Industry.

LVMH’s brand Sephora announced that it will be opening stores in India and China. The company plans to open 50 stores in India in the next five years. LVMH will form partnerships with leading Indian retail companies to open stores for the Sephora brand. India is seen as one of the most promising markets for premier goods but LVMH is concerned about the lack of the right kind of retail environments to market them from. At present most high end stores are located in five star hotels, which get a very limited number of visitors, although these visitors usually spend higher ticket amounts.

So, what’s really new about this? Nothing at all. It has become the expected reaction. Another protest against the entry to US retail giant to the Indian market, this time by an organization called the Federation of Association of Maharashtra (FAM). The organization represents all retailers in the state, including co-operative stores, hawkers and trade unions. The FAM protest is focusing on the expected social impact that international retail chains such as Wal-Mart will have on local stores. One of the well known co-operative stores, Apna Bazaar is also part of the FAM. The group has planned a protest on February 21 in both Delhi and Bangalore against the arrival of the Wal-Mart CEO Michael Duke.

Highly anticipated news this: Wal-Mart’s Indian partner, the Bharti Group will be announcing details of its joint venture deal with Wal-Mart in the next 10 days. The announcement is expected to be made when several senior executives, including Vice-Chairman Michael T Duke will visit India on February 22. The executives are likely to be meeting Kamal Nath, India’s Commerce and Industry Minister to discuss the joint venture. The US retail giant had earlier signed an Memorandum of Understanding with Bharti Enterprises to partner with for a retail venture and set up front end stores as a franchisee for Wal-Mart.

Consumer durables likely to become the next big sector. Its the turn of consumer durables to take the lead after the food and grocery sector, which is expected to experience a boom, with consumers taking advantage of easy availability of payment plans and reducing prices due to competition. According to a study by PricewaterhouseCoopers by N V Sivakumar, Executive Director & Leader of the Retail & Consumer Practice, "The market for consumer durables (including entertainment electronics, communitarian and IT products) is estimated at Rs 32,000 crore ($7.1 billion)." With the consumer durable market likely to reach US$ 13.3 billion by 2008 at a 10-12% growth rate, it is the segment to watch out for. Interestingly, the rural consumer durable sector is growing at a faster rate of 25% thano the urban consumer durables market, which is growing at 7-10%. Mobile phones, TV sets and music systems are the hot selling items.

Wal-Mart and Bharti are likely to adopt neighborhood store model US retailer Wal-Mart is known the world over for its large format hypermarkets and supermarkets, but for its operations in India, the company is considering opening small neighborhood stores to attract local customers who value local customs and understand consumer preferences. According to Love Goel, Chairman of Growth Ventures Group, a global retail investment firm and a former advisor to Wal-Mart, "We expect Wal-Mart and Bharti to explore the neighbourhood market concept because groceries are one of the largest retail categories with the least organised retail competition in India."

I’ve been using Technorati for quite some time now and really like the way I am able to use its resources to improve my standing in the world of blogs. Here’s my Technorati Profile.

Writing is the best stress reliever, I think. It’s a way to release tension, to let go of one’s problems and come up with solutions. I have been using writing to overcome problems for ages, but never connected it to why I was doing it. Now that I have, I feel as if I have come to understand myself so much better. Here’s to growing and learning over time.

The word ‘Fresh’ is being highly overused and overrated by the Indian retail industry. It seems like almost every second store is calling itself Fresh something or something Fresh. C’mon now, I’m sure there’s lot of other words your marketing departments can come up with that will get the message across. Who started first? Was it Reliance Retail who named its food and grocery supermarkets Reliance Fresh or was it ITC whose stores are called Choupal Fresh (its rural retail stores are called Choupal Sagar) or was it Heritage Foods who decided to name its stores based on their location, such as Fresh @ Banjara Hills (a locality in Hyderabad) and so on. Besides being hung up on the word ‘fresh’, retailers are also running out of colors, since they all seem to be going towards the reds and greens. It’s boring being a copycat. How about some originality, people?