| From the Editor's Desk |  | |
Leveraging kiranas: Time for a roll-up?
Retail is ready for a roll-up. With 10 lakh plus kirana store owners in the country and several of them having succession trouble (running a kirana is not the preferred career option for many in the new generation), it might be the right time for a roll-up operation. A roll-up is the consolidation of several small businesses under one roof, usually through a publicly held holding company. The roll-up strategy can be very successful if you have capable management steering the ship and an industry where the synergies for consolidation make sense. Roll-ups provide greater efficiencies such as merging back office accounting, marketing and purchasing. The roll-up also provides an exit strategy for mom and pop owners who are seeking to retire in the not too distant future. With most kirana stores occupying / owning prime property, the real estate benefits could be substantial. Challenges include standardization of merchandise and store layout and consolidation of the back-end, which is easier said than done. However, the potential to create a large retail enterprise using existing assets exists. Are any entrepreneurs listening?
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| At a Glance | |  |
| News: Apparel, Specialty, CDIT ... | | |
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Where is the Indian retail sector headed, and what are the speed breakers in its path? What can help retailers to accelerate growth without losing their existing momentum? At a recent CII event, retail sector representatives from across India discussed the way forward and reached a consensus on several issues. Emphasising that you need money to achieve scale, for which you need FDI, Kishore Biyani said, "It's a collective failure on the part of the retail industry to have failed to convince the government regarding FDI in Indian retail. The industry needs to come together and work towards the same." |
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Bangalore-based Arvind Lifestyle Brands said it is set to introduce Italian premium fashion brand, Energie, in India soon, as part of portfolio expansion. The company, which has a host of international and homegrown brands including Flying Machine, US Polo and Arrow, is also working on revamping and expanding existing labels in the country. "The company will open both shop-in-shop and stand-alone stores," Arvind Lifestyle Brands Business Manager, Vivek Sandhwar said. |
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Maxwell Vice Chairman & Managing Director, Sunil Pathare said Maxwell was entering the premium men's innerwear segment with Eminence, the top French innerwear brand. With an array of 23 products, including vests, briefs, boxers, trunks etc., Eminence was geared to turn into a premium lifestyle product. Maxwell has entered into an agreement with Eminence to make and market the products under the same brand name in India. |
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Weekender, an iconic fashion brand, plans to set-up around 220 exclusive stores and 150 shop-in-shops over the next one year. The major part of the expansion will be through franchising, confirmed a company official. The company plans to launch these outlets and shop-in-shops across 120 cities in India. Weekender has recently, opened its 100th outlet in Jodhpur. |
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VIP Industries, the largest luggage manufacturer in India, said it has decided to terminate distribution of French luggage brand Delsey SA in India and Southeast Asia, over disagreement on investments. VIP, which has been distributing Delsey products since 2001, has now decided to focus on its own brands. The luggage maker is also planning to launch the Carlton brand in India, which it acquired from UK's Carlton International. |
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In sync with plans to deepen its penetration in retail space, conglomerate Essar Group's retail arm Essar Hypermart today said it would sell steel online by current fiscal-end, which will contribute 10-15 per cent of its total sales. Besides, the company may hive off its retail operations after the implementation of Goods and Services Tax (GST). |
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| News: Food & Grocery, QSR ... | | |
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KFC Holdings (M) Bhd, which is fast expanding its operations in India, expects to have 17 outlets in the subcontinent by the end of next year. The fast-food outlet operator now has three outlets in India. Chairman Tan Sri Muhammad Ali Hashim said the 17 new outlets will include five in Mumbai, which KFC Holdings will acquire from master franchise holder Yum! Brands Inc. They will also include two outlets in Pune, which will be acquired from another Indian franchise holder, Kernel Food Pte Ltd. |
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'Taste and see' is HUL's new battle cry as it tries, for the umpteenth time, to push ahead in the foods business. And HUL is taking its experiential marketing strategy everywhere, from trains to shops to homes, to make customers taste and see. It has deployed 250 food ambassadors at stores across Delhi, Mumbai, Chennai, Hyderabad and Bangalore, with the help of its in-store execution partner, Smollan Holdings of South Africa. |
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Hyderabab based Bhanu Milk and Milk Products Pvt. Limited., known as Honey Brand in Andhra Pradesh, has forayed into the ice cream market by launching its Gluck chain of ice cream parlours in the city. The company inaugurated its first outlet at Osmania University campus. |
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| Retail Trends | | |
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New Delhi, October 19, 2010: Hyderabad's latest retail development is finally set to commence construction this September. Confirming the development, Ramakrishna Udupa, Project Coordinator at Soma Hyderabad City Centre Pvt. Ltd., points out that "the approval process has taken longer than estimated, which has resulted in a delay in commencing construction work. However, our goal was to clear this hurdle before starting construction." He adds, "While this has taken longer, we have been able to progress the concept and design elements to an advanced stage and are confident that this time spent in advance on planning will improve efficiency and reduce delays during the construction period." |
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Economic Times Cushman & Wakefield Research estimates India's retail market size at approximately $600 billion in 2010, while the organised retail market accounts for $50 billion, based on private final consumption expenditure. The demand for retail space across the country is estimated to be 55 million sq. ft, of which the top seven cities will account for approximately 53%. Mumbai, Bengaluru and NCR are expected to account for about 37% of the total demand. |
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India is exactly where China was eight years back. In the next three years, the modern trade format is set to explode; it will change the way the retail market behaves, said Rajeev Bakshi, Managing Director of Metro Cash & Carry. Excerpts from an interview: |
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In November 1997, UniverCell was founded by D. Sathish Babu. It commenced selling post paid mobile connections as a Skycell Teleshop (now Air Tel Connect). Observing the buying behaviour of his customers, Sathish realized what consumers wanted - to make intelligent and informed shopping decisions, in an ambience that combined both: comfort, and a high degree of service |
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Jasper Infotech, the parent company of SnapDeal, India's largest Daily deals website with a 65% transactional market share, today released its Online Group Buying Industry Trend report. The report focuses on the recent 'Deals Buying trend' online, witnessed among various Age groups, Gender, Geographical locations and Categories. |
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| Retail Insight | | |
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| The Value of Retail Search and Position |
| iProspect |
Internet retailers are forced to be the savviest and most demanding online marketers due to the commoditized nature of their products, the low profit margins their sales produce, the high volume of transactions they must generate to be successful, and the intensity of competition of their marketplace. While this survey looks at shopper behavior for consumer electronics and computer products, the same trends are at play across all segments of the retail marketplace. The research also closely analyzes the role of various search influences, and better understand how search engines and retail sites work together to deliver the most complete shopper search experience. |
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