JB Knowledge Park Releases Research Report on Indian Retail Industry

FARIDABAD, India - Feb. 28, 2015 - PRLog -- JB Knowledge Park Department of BBA released a research report on Indian Retail Industry. The report was released in second week of February. The research is headed by Mr. Amit Gupta of Henna Industries assisted by Kunal Paul of department of Bachelor of Business Administration

Report indicates that Decade 2010 started with a rush for great Indian retail story, every company on this part of the world planned its retail operations and target FMCG, starting from Reliance to Bharti, Aditya Birla to RPG. Enhancing Customer Base, Increasing Revenue, Growth story, Creating Niche and some other targets of big brothers pushed Profits on the back seat. The reflection of an Industry is Stock Market. None of the single FMCG retail Operator went for listing in last decade.

Why it happened
Competition is with local markets not with inter store markets.

Disruptive Proposition: ex Online and stuff hurted the market.

High Rentals & Salaries: Sale of 30-45 L is considered a good sale for any FMCG Retail Store, Rental and electricity consumes 10% of the sale and two shifts of staff makes a store running inviable with 20%- 25% of operational costs even after achieving desired targets

Ware Housing concept: India is different to rest of the world, in area like canaught place a Ciggerete / paan seller whose turnover is more than 20000 per day doesn’t have inventory more than 5000 at any given time. Job to fulfil is with distribution companies. Here buying lots from companies in expectation of 5% extra increases the cost of Warehousing and Distribution to 8%.

Biggies but extra and then Undercut the stock. This undercut stock goes to market, wholesalers and then the same retailers who are your direct competitors. Virtually the price becomes less than what you have been loading.

Discounts: In a Discount Rush, Initial entry was with discounts and deals and soon the price sauvy audience started shifting towards cash and carry stores .

Lack of Acceptability of White Labels: The biggest bail out for stores would have been white labelling, but India in 21^st century has become brand oriented. The brand doesn’t necessarily Global brands but a brand, a known brand which consumer has been using.
 The most selling detergent in India is Ghari… A classic example is Ghari. A white label powder cannot replace Ghari. Killers like Baba Ramdev, have introduced a different definition of same desi food with smart packaging and global pricing.

Report is available at JB Knowledge Park campus Library and online version is yet to be released on the website www.jbcollege.in