The Game Changer is Here !

Here it is, today's print ad from KB's Fairprice, inviting store owners to join hands with the group and avail the benefits of an IT enabled, scale back - end, while ensuring a standardized front end and uniform shopping experience.

I have discussed the franchisee expansion model in my earlier posts here & here. 
I firmly believe that it has the power to address the job loss due to FDI in retail, and other theories that currently limit the growth of this channel - mainly due to lack of funds to expand the coverage network. 

Mr Biyani in his interview here  had mentioned the plan to expand store coverage in Delhi and Mumbai through a franchisee network. Today's ad has set the ball rolling. 

KB's Fairprice has a large store network in Delhi & Mumbai - this seems to be a first step in ramping it up nationally.

The website here details the fixed costs and up front investments. It also mentions the selection criteria, the application and training process (a 9 day orientation programme), P&L preparation and the obvious benefits of aligning with the brand. 

This truly is a game changing initiative - for two reasons - IMHO.
1) This is a "never before" shout out to retailers across the country - those who want to upgrade themselves, or would like to get the benefits of scale.
2) The clarity and transparent nature of the communication - to be sure, I checked the Nilgiris website also - since it runs on the franchisee model. KBFP's site wins hands down on this front. This is the first time that a large brand has spelt out so clearly what it wants from its partners - the last memorable example was skumars.com (clearly not so memorable now)

Will Mr Biyani & team be able to crack the code ? Will only ATL communication help ? Should they also roll out a retailer engagement plan / road show ? (maybe they have thought of it - it will happen only to the selected franchisees ? How will India's Kirana community respond ? What will be the impact on people like Araamshop.com ? 

A strangely intuitive feeling strikes me as write this - would it not help both KBFP & Araamshop to integrate their business models? Perhaps, at some stage they may even end up doing so - and I hope that I am proved right on that count as well ! 

Reboot

Having read the earlier post, I realized a few things - 

1) Setting an agenda and sticking to it might be a really ambitious idea..

2) It would be really difficult to be posting very regularly..(haha - I am posting now after 6 months !! ) 

3) Hence, it would be a better idea to limit the posts to a few per month, with a general sense of direction towards specific ideas..each month. 

So - 

The theme for the month is :

A History of Modern Trade in India..

I am also working in parallel on a list of abbreviations used in the business....which should hopefully see the light of day soon !

Modern Retail in India has a skew towards the southern states - even today the south would possibly be the largest geography in terms of Modern Trade (MT) contribution for most FMCG companies. 

Two modern retail chains in India claim heritage dating back to the 19th and early 20th centuries  respectively - Spencer's and Nilgiris. No surprise that they are south based / have a chunk of operations there !

Anecdotal evidence basis conversations with my father suggest that Spencer's used to be a happening store chain in Delhi, in the early sixties. Most large format stores carry a detailed timeline of the chain's history.

It can be safely deduced that its pan India operations shrunk drastically in the years following independence, and its operations were confined to the city of Chennai, which still has the eponymous plaza on Mount Road.

Convenient neighbourhood location was a big factor contributing to Spencer's success in the city. Even today, given the sheer number of active stores there - TN would probably be a key state the Spencer's eco system. 

Post the takeover by the RPG group - a Kolkata based conglomerate - Spencer's re evaluated the modern retail supermarket format business through a tie up with Dairy Farm International - an excellent account of this can be read in the book by Mssrs P K Sinha  and D P Uniyal. They piloted this with a single store in Bangalore, and gradually built upon the experiences gained here to expand operations. They also have the honour of launching India's first hypermarket - the Musheerabad Hyper (then called Giant's Club).

Unfortunately, this marriage did not last long owing to various reasons, and both parties decided to go their own ways in the quest for modern retail excellence. 

An interesting anecdote here - given the small universe of organised retail professionals, it was no surprise to see many Spencer's alumni in other chains. Most of them speak with a lot of pride about the time that they spent there - and to me, as an outsider - it seemed that Spencer's had at one time been like a university or finishing school for any aspirant to this domain.

Landmark Spencer's stores today - 

Chennai - Adyar, Besant Nagar, Nelson Manickam Road

Bangalore - Old Airport Road, Sarjapur

Hyderabad - Musheerabad, Ameerpet

More on Nilgiris next time...