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Retail making losses

A year and a half ago I had predicted that with a little effort, the Indian kirana stores can beat the MNCs, and big supermarkets black and blue.
Basically the big retailers have to:
1. Organized retail pay a much higher rent than the local shop/hawker
2. The salary in organized retail is much higher than the daily wage paid by the kirana store.
3. Its hard to believe that any retail can be more efficient than HUL and P&G in managing inventory and supply chain.

Today I read this news in telegraph which says that on a annual sales of 1070 crore, Spencer (RPG group) made a staggering loss of 289 crore.
Subhiksha went out of business and almost every other retail store is cutting back on its expansion plan.

Reading this post, you might feel that I am against organized retail. However personally I prefer malls and organized retail because of better retail experience.

2 replies on “Retail making losses”

but where are the walmarts
organised retail has to push customers to make bulk purchases
and the discounts they offer are still paltry and can be mostly
matched by the kiranawalas, whose biggest usp these days is home delivery

ps noone would buy Rs1000 goods for a 5rs discount on 10kg potatoes

:)) i know many of the schemes r ridiculous.. no wonder organized retail has to go a long way before they can get their act right…
btw i have a feeling that big bazaar is different

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