Tuesday, April 01, 2014

Indian Retail and The Grouse Economy

The Grouse Retail Economy

By Harish Bijoor

We live in a world full of complaints. The retail world is no different.

In the beginning, the micro Mom-and-pop retailer complained about the neighborhood large store. The Micro retailer had his own grouse. He ran his outfit with the help of wife and son and daughter. His was really a ‘Mom, Pop & Child’ enterprise. In came the corner grocer of relatively larger format. While the Micro-retailer managed with a 60-sq feet enterprise, the corner grocer was all of 600 sft. He stocked variety. He stocked both grains and packaged items. He offered better lighting and a better display. He had a refrigerator to stock butter and bottled drinks as well.  Consumers of the hinterland flocked to him, and the micro-retailer remained micro in terms of size and dream alike. The corner grocer became the big bad boy of retail. Mom, pop & Child cried hoarse.

And then came the super-market.  This happened all of 35 years ago. Into the hinterland of the corner-grocer, who had grown leaps and bounds, came the local Super-market. This guy was bigger than them all. He had occupied all of 3000 sft. He offered a seamless shopping experience that brought in self-service. A customer could not only see the item he was buying, but could touch and smell as well. He could compare one with the other. He could peer keenly into the produce and package. He could be that much more informed a shopper.  He ate into the hinterland of consumers hitherto dominated by the corner grocer and his smaller cousins in the realm of the ‘Mom, Pop & Child’ format as well. The large-format super-market became the bad boy of Indian retail now. The corner-grocer cried foul. The ‘Mom, Pop & Child’ enterprise believed this was karma playing out. The smirk was now on his face.

And then came real organized retail. Organized retail spearheaded by organizations that were never imagined to be in this space. These were Indian enterprises of every kind. In came the Future Group. We had a Reliance Retail happen. In came the Aditya Birla effort. In came every other effort from every other group, (the Tatas included), that was hitherto considered an entity that had bigger axes to grind than to look into the realm of retail as a business proposition at all.

This was big fish entering the space of relatively moderately sized fish.  This fish wanted to eat it all up in a way. It protested and said that nothing would happen to the micro-format, the corner-grocer and the medium-sized super-market at all. In many ways it was right. The market opportunity was so large, and the efforts so small by these biggies as they tested the waters, that nothing really happened to eh volumes enjoyed by the rest of the retail chain. Big fish did not really eat small fish. And Darwin was right. The fittest in every category survived and thrived. Every category had a space all its own to occupy and hope to thrive in. The operative word here is ‘hope’!

But then everyone cried hoarse. Everyone complained. The bigger you were, the ‘badder’ you were! Forgive me for coining that word and giving good grammar a beating. It deserves it here.

And then we have just about emerged from the cries and the tumult on FDI in retail. Even the biggest Indian names in retail are said to be in sync with this, only to attract FDI that goes to mitigate its losses in this space. It is said that the biggest Indian names would not like to compete with a 100% Wal-Mart or a 100% Carrefour effort. The wails are still around. The complaints are still floating in a space very near to all of us.
The latest cry is from the space of the physical brick and mortar retailer. Brick and mortar retailers are now crying about the current small fact that the e-retailer is making a dent into his business. Bookshop owners are crying hoarse that consumers are browsing physical books at their stores and buying them online at a discount. Quite the reverse of what was being done a couple of years ago. As of today, I buy my vegetables at home from an e-retailer.  E-retail is not ubiquitous as of now though, and I hold that e-retail is still anecdotal in its presence, reach, acceptability and habit. Even then, the cries are all around. The complaints are all around in our psyche.

The retail world has been a complaint economy thus far then. It started thirty-five years ago, and the complaints are still around. Newer ones replace older ones.

As all of this abounds, my one suggestion to the latest complainant in the space of brick and mortar retail is a simple one. All of us need to accept the fact that Darwin has always been right for all of these 175 years. The fittest will survive. Retail that caters to the needs, wants, desires and indeed growing and forever changing aspirations of the consumer, will always survive and will always thrive. There is space for everyone.

The fact remains that India is large. The fact remains that the Indian is on the morph. The fact also remains that for every one of our 1.2 Billion people, there is a solution that needs to be different in its appeal. Each of our retail formats, from the micro-retail format of 60-sft to the e-retail format of just no square feet at all, has an appeal to a distinct set of customers. Everyone will survive and thrive.  The fittest in every space will thrive.

Just no point complaining and wailing about it at all.  Let’s laugh together. Hopefully all the way to the bank. The e-bank.


Harish Bijoor is a brand-strategy specialist & CEO, Harish Bijoor Consults Inc., a private-label consulting practice that operates in the realm of brand and business strategy. The company has a presence in the markets of India, Hong Kong, London, Dubai and Istanbul.
Harish is a public speaker who speaks to Corporate audiences across the globe in the realm of motivation, people-management issues, brands, marketing and business at large.
He is active on twitter @harishbijoor


Unknown said...

the retailing is increasing and investors are getting profit.

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Unknown said...

Nice blog.
Thank You,
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Unknown said...

waoo nice post about The Grouse Retail Economy


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Thank you, for getting something new and saluting the irrationality of this story, hopefully it will be useful, so that this life is more useful and useful for others.
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