Showing posts with label Viveks. Show all posts
Showing posts with label Viveks. Show all posts

19 July, 2020

WFH – Boon to Retailers & Brands

Many companies have advised their employees to plan WFH until end of this Calendar year. This means a good / happy news as well as a significant job loss for millions. That more people will lose lives and livelihood for the grave mistakes of themselves and the Governments across the world is a reality that we are staring at. However, the eternal optimist that I am, I can already see green shoots in certain segments of the consumer business. Some of you may recall that during my Webinar sessions in the months of April & May, I had referred to certain categories which is only bound to increase if not at least sustain its current business opportunity. Most of the daily household items have seen consistent growth even during the extended lockdown while Food related FMCG have shown tremendous growth. Categories such as Coffee, Tea, Sugar, Flours & Pulses have seen a spurt in sales for many brands while Retailers, albeit with a shortened operating time than before, are not complaining, thanks to consistent footfalls and increased bill values. 

However, what has taken many Retailers, Distributors and the entire supply chain by surprise is the huge surge in work-furniture for home and Electronics + Consumer Durables. We ourselves went shopping last week only to find that Godrej Interiors had completely run out of stock for 4 weeks, Home Town had absolutely no sight of when stocks would be replenished, over 40 customers merely waiting to enter Home Stop and hitherto B2B players such as Featherlite living up to the unprecedented opportunity and serving customers with their backend capabilities being spruced up. Traditional Furniture Retailers are not lagging behind either. Actually, I see many of the neighborhood shops doing brisk business with the highest demand for compact desktop / laptop chairs under Rs. 4,000 a piece followed by chairs that suit or double up for other purposes. I have also been hearing a few of my Architect-friends getting calls from their Business Clients to set-up / renovate their homes to be able to work. 


The other category which has been doing extremely brisk business is Cosnumer Durables, Home appliances and personal electronics. While Amazon & Flipkart haven’t resumed their deliveries fully across geographies, consumers are literally seen shuttling from one shop to another for want of peripherals such as computer mouse, headphones, Mobile Phones with 4GB RAM (to be able to take up Apps such as Skype & Zoom) under sub-Rs. 10,000 and most importantly, Laptops. I guess desktops as a category is passé – one, it occupies too much space and it’s immobile within the house as well as across users, which gives a push for laptops. 

In my own personal case, I had to wait for over 6 weeks to get myself a new MacBook Air, an upgrade after using the previous Air for 5 years. Thanks to good friends, I was able to lay my hands on one out of the two pieces that landed in Chennai after the recent lockdown. The folks at Apple India as well as Apple Retailers say with a grin that most models of MacBook / iPad are out of stock and there is no immediate visibility of their arrival into the stores.


With the State Governments finally budging for schools to conduct Online classes – the High Court of Tamil Nadu has especially allowed private Schools to collect 40% of the Annual Tuition Fee for the present academic year – Online Classes are getting more and more real. The state run “Kalvi Tv” in TN shall also showcase online lessons while every other State Government is looking at similar measures to ensure continuity of education. This further means more requirement of laptops, earphones and so on. That there is no shortage of Electricity at urban and semi-urban homes is a big advantage.

Smart Entrepreneurs, Individuals and Businesses have lapped up this opportunity. A second-degree associate of mine who was retrenched by his employer, a Hardware Engineer with 10+ years of experience has taken up direct sale of Laptops to Corporates making a neat 4-5% commission on the purchase value. He claims his income, although a temporary one is lesser than what he used to make in his previous job while he reconciles that he is unsure how long this would go on – his parallel entrepreneurship and the Corona lockdown. Whichever way, make hay while the sun shines is the way forward I guess. 

Meanwhile, traditional retailers in both these categories are indeed an aggrieved lot. For Example, the Founder of a family business which is in to Electronics for the past 2 decades has been adamant on downsizing his margins for want of volumes. He claims that this one-off discounting model on gadgets such as Iron boxes, Personal Shaving Equipment (for men) and other household items such as mixer grinders and refrigerators will hurt the business once the challenges are over, especially around Deepavali 2020. What he doesn’t realize is whether he would be operational until then, running 20+ stores across the state, employing over 300 people and a joint family of 4 siblings and their wards. 


In another instance, a proprietary furniture dealer near my home refused to entertain any sort of reduction on Chairs claiming that these items were already on high demand and that he sees no reasons why they should be sold at lower prices. That there are literally 100s of furniture shops around is something the gentleman should realize soon. Maybe, he wouldn’t. 

I am actually planning to write a book which would go by the name “Corona Millionaires” which could be release in 24 months or so. No, I am not referring to the likes of billionaire Shri. Mukesh Ambani and his ilk. I am referring to common people like you and me – who found this crisis as the biggest business opportunity of their lives. May be a Netflix original too. It could rake in more money than what many Entrepreneurs would make during this crisis.

17 October, 2016

Chennai Shopping Festival

For the first time, Retailers in Chennai have come together to create a one of its kind Retail Promotion. Titled "Chennai Shopping Festival" (CSF), this is organised by the Retailers and for the Retailers of Chennai. My own start-up Smiling Baby, a baby store that caters to the needs of new born kids upto six years is a member of Retailers Association of India (RAI), an Industry body that represents our needs and requirements to the Government and other bodies. Under the auspices of RAI, members of the organisation have come forward to create a marketing property which is CSF. The idea was rolled over on our WhatsApp group by a member, seconded by a few of us and actioned by all of us in just a week's time from start to finish. We have built a simple website that provides information about the various participating stores and their offers. Take a look here.


Over 30 leading Retailers from Chennai spread over 300 stores in the city including Viveks, Odyssey, Basics Life to name a few have come forward to join in this promotion. The big highlight of this promotion is Uber has come forward to ferry passengers to select Retail Store locations by using the code CSF150 (One Free ride worth Rs. 150 for new users!).

We at Smiling Baby also have a few interesting offers.


Smiling Baby is located at E-135, 6th Avenue, Besant Nagar, Chennai. Ph. 044-43507015 / 9176300015. Open All days from 10am - 9pm. Over 100 brands are available at competitive prices across categories such as Baby Care, nursing & Feeding, Maternity, Cosmetics, Baby Gear, Toys & Games, Apparel and Accessories. The store is the ONLY Destination Store for Medala, world's best mother care brand and houses the entire range of Medela products such as Breast Pumps, Maternity Hygiene, Feeding bottles and so on. One can also find world's other leading brands such as Chicco, Pigeon, Fisher Price, Himalaya, Johnson & Johnson and many others.

Once cam also shop online at www.smilibaby.in where the products will be delivered the same day or the next day with a Cash on Delivery option other than paying by Credit / Debit Cards at the place of delivery using mobile EDC machines.

Do spread the word; visit the website and click the "Get Offer" button so you receive an SMS to your mobile. Happy Festivities. Happy Shopping.

31 March, 2016

FDI in Ecommerce

The Govt. of India has recently affirmed through a circular through DIPP that Foreign Direct Investments in E-Commerce companies is allowed upto 100%. There is cheer among a few although there are clauses and causes for worry for many. The notification says that 100% FDI is allowed only in companies that operate as a Marketplace and not on those who operate with their own Inventory. 

Let me clarify this with some examples;

Amazon, Flipkart, Snapdeal and PayTM are the big Four Marketplaces in India and so is my own startup Oyethere.com. In these models, the company doesn’t own any inventory and merely facilitates the sale of products between Retailers/Sellers and Customers. Marketplaces bring together the above-mentioned two parties and complete the transaction. There are several variations here too. For instance, some marketplaces merely connect the buyer and seller (OLX) and the money is paid by the buyer to the seller directly. A majority of them including Flipkart and Oyethere.com collect the money from the customer while the Retailer provides a Bill/Invoice to the customer. The Marketplaces then repays the Retailer with its Sales value after deducting commission, if any. However, there is a catch for the big two companies, Flipkart & Amazon. Flipkart has a subsidiary company by the name WS Retail which is the largest seller on its own marketplace. Similarly, Amazon has a 49:51 JV with Cloudtail which is owned by Catamaran ventures, which is in turned owned by the family office of NR Narayanamurthy, Chairman, Infosys. These two companies could face issues because the DIPP Notification on FDI states that no more than 25% of Sales can be derived from one seller in the marketplace. This could be a potential spanner in the scheme of things until these large companies find a legal way out.


The most affected ones would include the likes of ZivaMe (lingerie), Urban Ladder (Furniture), Hopscotch (Baby Care) YepMe (Fashion) which has Shah Rukh Khan as Brand Ambassador and is also an Investor, Myntra (Fashion) owned by Flipkart and many other small and budding Ecommerce players who have already received foreign funding or are in the process of raising one. These companies are legally not allowed to receive FDI more than 49% which would never be possible.

Having said the above, the biggest beneficiaries would be the offline Retailers like Viveks Ltd. (Consumer Durables) who have already been selling online through Marketplaces. Oyethere.com also enables offline retailers like Café Coffee Day, India’s largest café chain with over 1,500 cafes across the country, Brown Tree (Organic Food), CeeDeeYes Supermarket, Smiling Baby (baby shop) and many others to sell their products online through its portal thereby facilitating the sale between the Retailer and consumer. I am personally meeting several Retailers to convince them to come on board our startup Oyethere.com and benefit from the incremental business opportunity without spending a dime on Marketing or Business Development.


There is a deterrent to Marketplaces as well – they are not allowed predatory pricing, meaning they cannot unduly discount the prices of products and ensure that the prices are merely competitive. This brings a lot of trust on marketplaces like Oyethere to Retailers because they are sure that they, and not the marketplaces, have a final say on the final pricing of products.

One of the promises of the Narendra Modi Government in their election mandate was that they would not allow 100% FDI in Multibrand Retail. And they have stuck to their guns. However, Ecommerce is seen by the Government as an enabler of trade and not a threat and hence this move which is expected to benefit very large marketplaces like Amazon and Flipkart and newbie startups like Oyethere.com.

Look forward to some interesting days ahead in this space.

06 September, 2010

Show-stopper - Shoppers Stop!

There used to be a time during the late 80s and even early 90s when this part of Bangalore was the most preferred area to settle down for the older generation, mainly due to the lush greenery and minimal traffic. After all, why would any one pass through Koramangla – an erstwhile nondescript part of south Bangalore that connects the city towards Hosur, Chennai. Etc. However, all this changed, thanks to the IT revolution and what followed was concrete invasion. Large tracts of empty lands gave way to huge constructions – corporate offices, residential block and of course, Retail stores. In India, one thing is peculiar, if not common. It’s always the unorganized retailers who enter a locality sensing consumption opportunities. The Kirana stores that sell everything from tooth paste to grocery, the Hardware stores that sell all that one would need in their homes, from door handles to curtain rods and the ubiquitous furniture stores – large shell shops that stock cots and mattresses, dining tables and other loose furniture. After a few months, if not a few years of the area settling down with people, the Organized Retailers start swamping the localities. What’s natural is that when a locality is on the verge of getting popular (from a consumption perspective), most of the big players enter together, if not in shorter bursts, thus unsettling the small kiranas.

And the same happened to Koramangla as well. After a lull for many years, organized players started penetrating this area – RPG Foodworld (now Spencer’s), Monday to Sunday (from Jubilant Retail), Viveks – the Electronics store, MegaMart (from the house of Arvind) and most notably, Big Bazaar (BB), a Future Group concept. Interestingly, this was one of the earliest outlets for the now ubiquitous value-retailer in India, a mere 35,000 sft store that was supposed to be a Pantaloon Fashion Store! There was a last minute change in the concept and thus was born BB. The store is located in a building that also houses many corporate offices and hence parking for 2/4 wheelers weren’t too many. Anyway, value-retail stores were expected to bring their shoppers by Bus and thankfully, there was a Bus-stand just outside the store. Rest as they say, is history. This BB store attracts as many people driving their own fancy 4 wheelers as much as those coming by buses and autos and is supposedly the highest in terms of returns per sft, a key metric for Retailers.


The year 2004 saw the opening up of Forum Mall, the most notable Retail landmark in Bangalore till date and rightly so, located adjacent to Prestige Acropolis, a residential dwelling that houses the crème de la crème of Bangalore. The Mall has such a unprecedented opening that the U-turn on this road had to be removed, thankfully! The first outlet for McDonalds in South India opened here and without exaggeration, there were queues waiting outside the store just to get in and have a grub. I was among the last to enjoy the frenzy, when I first entered the store almost three months after they opened. The Mall had many other firsts as well, the largest stores for Fashion Brands such as Benetton and Tommy Hillfiger, the first Apple store through its distributor aptly named “Imagine”, the largest (then) foodcourt in town with over a dozen different cuisines, and the first and among the largest cinemas in Bangalore operated by PVR. The retail chain from the house of Tatas, Westside was the anchor and Landmark Books & Leisure (which was also bought out by Tatas) was another anchor. There wasn’t a multi-brand Department store and thus all the Mono Brands present in the mall perform very well. There wasn’t anything that wasn’t amiss and the Mall ably run by a professional team from the Prestige Group went to win accolades for their achievements, in design, tenant mix, zoning and most importantly managing the multi-level car parking, among the largest & the first in the city.


The area started getting a lot of attention from construction companies as this was the closest locality for those who were working in Bangalore’s own Silicon Valley area – The Electronics City. Real estate prices of land holding soared so high that the area was and still among the most premium residential areas in the city. Almost every Retailer has a presence in this area and the only brand to have multiple locations due to its business model is Cafe Coffee Day – yes, there are five cafes within a three km radius and there are two more in the offing. Recent retail concepts such as E-Zone (also from the Future Group) and Star Bazaar (a hyper-store from Tatas) have found their own spaces and are serving their customers quite well. The one Retail concept that was conspicuously missing was Shoppers Stop (SS), India’s largest multi-brand Department Store chain. And that too was fulfilled recently. While operating three other locations in the city and one at the Bangalore International Airport, the retailer took over the same location earlier occupied by fellow retailer and similar business house “Globus”. There were many reasons why Globus wasn’t doing well; many experts felt it was the location that was the main one at fault apart from the depressing merchandising at the store level. In Retail, there are three main factors to consider before opening a store – Location, Location and Location. And that’s exactly what SS has tried to revisit. They have chosen one of the most complicated locations ever possible for a Retailer but I am sure the decision was conscious and would prove to work to their advantage. After all, who knows this business as well as they do. The store is located in one of the busiest stretches in Bangalore, just ahead of an important traffic signal where the waiting time could range from 10-30 minutes during peak hours to crawl through a 300 meter stretch. Entering and Exiting the store is not just difficult but would need sharp driving skills. The store, which is spread across 40,000 sft is self-sufficient to that catchment since most of the brands have their own stores independently or within the mall close by. The well-maintained and well-merchandised store has almost everything that a harried customer needs, but for a cafe which I guess should soon be there too.


But why one more Retail concept for a locality that already has a substantial penetration of retail formats? Well, one reason is that there is no Shoppers Stop! The unique shopping experience that the Retailer provides is not just consistent across the country but also amongst the most superior in its own form. Secondly, when an area has as many shopping formats, it becomes a natural destination for shoppers. It’s not just the Retailers who benefit due to the presence of a large number of consumers but also the shoppers – they benefit from the wider offering that they are offered and not to mention the innumerous promotions and special offers through the year. So, lets hope this outlet of Shoppers Stop is indeed going to become a show-stopper!

22 August, 2010

Much ado about nothing...

It is quite common to see radically minded political parties create ruckus during cultural celebrations such as Valentine’s Day, Friendship Day, etc. citing them as western concepts which India can do without. Although most of them forget that ours is a Democracy and one is free to live the way they want to, provided they fall within the legal purview of our constitution. Retailers had initially taken advantage of such events, creating a lot of hype around and managing to attract customers. While the trend still continues, many of them have toned down the way it is celebrated and have started focussing on other days of national importance. In Western countries where Organized Retail has evolved much, Mother’s Day, Father’s Day and even Thanksgiving are celebrated with glee and harmony. In India, while we have been celebrating Children’s Day (birthday of former and first Prime Minister, Jawaharlal Nehru), Teacher’s Day (birthday of freedom fighter and academician, Dr. S. Radhakrishnan) and regional festivals like Akshaya Trithiya (most auspicious day to buy gold), Raksha Bandhan (sibling’s day) and Karva Chouth (prayers for the husband) for many decades now, Independence Day and Republic Day are celebrated since 1947 and 1951 respectively, ever after achieving Independence from the British Rule and since becoming a republic country. Although earlier, these days were usually celebrated with national fervour and devotion, they have been converted into social events which also include personal and family celebrations, since they are usually preceded or succeeded by a weekend.


Sensing an opportunity, one of the first retailer in the country to take advantage was The Future Group. Way back in 2004, the company which operates the largest Hypermarket chain under the trade name “Big Bazaar” created a unique concept “Sabse Sasta Teen Din”, which translated into English means “the cheapest three days”. When they first experimented this concept on 26th January, India’s Republic Day which also happens to be a National Holiday, the queue outside the store located at Lower Parel in downtown Mumbai was miles long and the store had to be shut for a few hours to ensure safe exit of those who had already walked into the store! Ever since, there was no looking back. Founder & CEO Kishore Biyani who is known as the pioneer of Organized Modern Retail in India has experimented more and more – a mantra that he and his company lives by. The three days became longer and usually were tagged to the closest weekend and over a period of time, more such events were created. As always, many others in the business followed suit and started following their own trends – creating marketing concepts that suited their respective business models.

2010 was a bit special though. To celebrate the 63rd Independence Day on 15th Aug., almost all the large Retail players in India attempted such a concept in their own way. Newspapers were abuzz with articles, write-ups, advertorials and full-page advertisements. Needless to say, news publishing houses would have cashed in on this opportunity; after all, they have been quite starved over the past two years with minimal ads by Retailers who pulled back their spending after the global recession which impacted Indian consumers more psychologically than financially. The message from players across product categories ranging from apparel to electronics, grocery to home furnishing was loud and clear – discounts ranging from 10-60% over the weekend. The hype was carefully built-up over a period of time and the buzz in the minds of shoppers was clear – visit the stores at the earliest and get the best out of the season. Erstwhile popular but now dormant retailers like Viveks, one of the oldest and trusted electronics dealers with a strong presence in South India bounced back with amazing offers. In fact, this was the very place where my parents purchased our first prized possession, a Crown Colour Tv in 1981 at a nondescript location called Luz Corner in Madras, (now known as Chennai). Over the weekend, my mother went there again, this time to buy a Microwave Oven, a reasonably new gadget in the life of Indian homemakers that promises comfortable yet delicious cooking. Well, she visited the store for just one reason – her trust in the brand “Viveks” continues to remain strong, where almost all our household items have been purchased for the past three decades.


One of the most exciting concepts created this year was again from Big Bazaar, aptly titled “war on inflation” – helping housewives to fight the price rise in the economy. While everyone from the Prime Minister to my car driver have been talking about the rise in prices of essential commodities and the measures that must be taken to curb them, The Future Group was the first one to create an impact. It has been running various campaigns in the media, highlighting the fact how Big Bazaar can together fight with the middle-class households by offering products at lower prices and shoppers can buy large quantities and store them for future usage – a form of hedging, if one could say so. Expectedly, all the stores in the country, numbering over 125 were over flowing with eager shoppers who started thronging the stores since as early as 9 in the morning until 10 in the night.


Somehow, the focus of shopping during the season remained on categories such as Grocery & Household and Electronics & Appliances. E-Zone (another Future Group format) and Croma (from the house of Tatas), both of which operate in the premium consumer durables space and target SEC A & A+ went ballistic about their offering, by providing never before prices coupled with freebies. Most notably, both were offering spot loans from Bajaj Finance, wherein select products could be purchased on EMI – Equated Monthly Instalment after paying a token sum as down payment. The processing of loans was quite simple – in just a few minutes after obtaining some basic documents such as an address proof and an identity proof, loans are sanctioned on the spot if one holds a credit card. I was amazed at the speed at which loans ranging from Rs. 10,000 – Rs. 60,000 was being sanctioned, without any collaterals or scrutiny. It is anyone’s guess what happens if the loan is not paid back or the borrower vanishes once for all.  Reliance Retail which operates multiple formats kept its communication straight – highlighting the number of stores and thereby the inherent foothold it holds in the business. Some traditional local retailers tried their best to match up with their national peers. While they successfully demonstrated their presence in the business and their respective leadership positions among their target customers with full-page ads in national dailies, they also showed that they could offer at prices similar to those offered by national players thereby conforming their positioning – they remain equal if not cheaper compared the newer larger entrants within the business.


One question that came to my mind over the weekend – why so much fuss to offer the best to customers! Do we need special days in a year to pass on the benefit of margins to shoppers? Is it just a trend that’s getting started or would we evolve as we move forward? Many in the Industry already agree that in India, we just can’t rely on Thanksgiving and Christmas Shopping like in the West, since we have more than 300 days of festivals all through the year across six major religions, a dozen national holidays and many more regional excuses for shopping. Isn’t it better to maintain a momentum and build shopping behaviour all through the year rather than just creating hype during a one-off period? Am sure, the answers could be mixed and diverse, just like our Retail environment. Well, that’s the best thing about us. Incredible India. Jai Hind.

A Firefly finally takes off

Monday - 22 Jan. ‘24 is a very important day in my professional life. I complete eight months today in my role as Executive Vice President a...