Saturday, September 5, 2009

Retailing scenario in Indian Mega Format or Modern Trade

My experience with Mega Retailer has been a mixed bag of experience.  Some times i avail good offers 1 plus 1 free offers on mostly slowmoving products such as Amul butter milk, Frozen chicken sausages, Tasty bite products, etc.  But the billing errors, scheme being knocked off, loyalty card not being swiped, old priced stocks sold at new price, etc are some of the goof ups.  The biggest let down is when you are asked not to enter the premise before the opening time.  Will you chase out your first customer just because he or she has arrived before time ?  If it were your own business you would happily serve him.  How about sharing your experience guys ?

Modern retail format in India is currently funded by deep pockets of Big Banners Reliance, Birla, Future group, Raheja etc. Even during the worst of recession period none felt the pinch of salary delays or downsizing to a large extent. Companies which were mismanaged, likes of Subsiksha went down under without trace of revival. The gaps in the retail format is so glaring in Indian scenario, when compared to the Harrods philosophy, which boasts of getting anything in the world for its customers.

Availability : The majority of the Modern retail formats don t have the right indenting or replenshment procedures. Many a times the stock out is a bane. Stock outs in FMCG product segment is bemusing, particularly with daily consumption items such as Milk, Curds and dairy products. Stock outs prevalent in veg and fruits are understand in view of seasonality factor. Some formats adopt push indenting, others physical indenting and some others random indenting on customer demand. I always found that the following items have random supply such as Amul curds, Dabur coconut milk, Modern Shakti atta bread, ( which was wrong understood by one major as Shakti bhog atta ) MTR Macroni, Priya Veg or Non Veg curry paste, etc. One finds stocking in plenty of MNC varients in the segment such as Nestle, Daily bread, Kitchen India, etc. Some of the supervisors are not even bothered to note or send request to their feeding points to ensure supplies.

Attitude towards customers : Any mom and pop grocery outlet which is run by an individual values his first customer as Boni customer and treats them as God, whereas the Modern day format salesmen treat them as a Dog, and literally chase them away if they arrive before time. Many a times i have faced this and complained to the respective supervisors. Other day i went to urgently purchase some idli and dosa rice before 10 minutes of opening, the salesmen argued with me how did the security personnel allow me inside the outlet, because 10 am is official opening time. I checked up with the billing clerk, she said she is ready to bill. It was a shocker to the salemen. He had to oblige me by default and so i ended up with purchase 9 minutes ahead of scheduled opening time, but with persuasion skill. Under normal circumstances, i would have to waiting beyond 10 am at this outlet. So whatever training is imparted to salesguys are literally superflous if they are not able to change the attitude towards customers. I hope they understand customers are not DOG but God.

Exchange of defective goods : The procedure for exchanging goods and services depends on the discretion of the retail supervisors in most cases. Many a times it is question of trusting a regular customer that he is not going to lie or mislead. After nearly a year of transaction with Reliance, i was for a pleasant surprise for exchange of defective potatoes. I just wanted to point out the defective product not least expecting exchange. In fact i was given the option of 1 kg without even verification. But i found only 2 pieces defective of medium size but i was given small sized potato which I happily accepted. There was no verification of bill, date of purchase etc, it was pure trust. This is what i liked about Reliance with no frills attached. Whereas my experience with SMART was really stupid. The concerned supervisor who gave me Tomato ketch up in exchange of Mangoes refused to exchange the sauce bottle for higher grammage. I was about to return half a kg Tomato ketchup to buy 1 kg of the same brand, after realising i had paid Rs 60 for half a kg and 1 kg price was Rs 90. The supervisor refused to exchange the product and thus lost a customer maybe forever.

Benefit of Lower Pricing : Majority of the modern format despite assured margins would like to hike the prices along with market trend. Recently i noticed that toor dhal which was selling at Rs 50 went upto Rs 90 per kg within a fortnight. The SMART supervisor was literally cursing the billing clerk, to revise the price immediately, that too in front of customers. The SMART way of doing business would have been to give the benefit of doubt to the customer and revise the price later. But he chose to boost up the profit of his company and ignore the customer interest.

Many a times I found that modern format revise the price of the products with 2 stickers, one with old price and revised with newer and higher price. It goes against the MRTPC act, PFA and weights and measure act to incorporate two price stickers. This phenomenon is really exhibiting the greed of the format to fleece the customer. When we were involved in selling the product, we used to pass on the benefit of lower pricing to the trade, who in turn used to pass it on the customer, what a change of attitude towards the customer in a span of 2 decades.

Expiry Dated Stocks : The prudent way of getting rid of near expiry stocks adopted by many a companies is to cut the prices by 50%, instead of taking back the stocks and incurring additonal expense. Some companies do take back the stocks and repack it and dispose off the stock. Many a hefty discounted food products like Jams, Squashes, Pickle, Fruit juice, Atta are all products nearing expiry date. If at all one ventures to buy such products it should be consumed immediately and not stored at the consumers place. I am wondering whether such stocks should carry the rider. To be consumed as soon as possible.

Clearance Sale : Many non moving, slow moving stocks in garmets, and other consumer durables are periodically disposed off in clearance sale mode. Garmets are disposed of in various discount formats. Buy one 25% off, Buy two 50% off, Buy three 75% off and Buy four 4 free. The logic for eliciting better sales would be to offer buy 2 and get two free and furnish 50% off on sale of one unit. Sounds tricky. Yes this formula will elicit better sales volume than offering a deep discount on higher purchase. The consumer should not fell sleighted by scheme mechanics. The reverse is true for marketers too, when one operates a volume purchase the telescopic benefit should vary in minor percentages. The difference can be maximum half to 1 percent, beyond that it is harmful practise akin to cutting the wood under one’s own shadow leading to downfall.

1 comment:

Ritz.. said...

It was a really knowledgeable

Please read mine and vote for it if you like :))