In my previous article (The Indian Retail Success Story) I mentioned the critical success factors for the great Indian Retail Story – economic, the consumer and the retailer. By now a lot of us would have ourselves witnessed the retail success, but many of you may have a similar thought- has the industry seen its peak- what more can happen to the retail industry?! Let’s find out.
Well reports suggest that you wouldn’t have a better time than now to join the retail juggernaut. And with aspirations of many foreign players, thanks to the ongoing FDI talks, this industry would just get more promising. At the same time there will be some critical areas that will gain a lot of importance in the years to come:
- Need Based Offerings : As consumers differ on the basis on several traits, especially based on the location, retailers will have to address the location dynamics and customize their offerings at the local level. This will help in facilitating sales and revenue! At the same time, retailers will have to make good use of the information received from loyalty programmes to understand consumer behavior.
- Operational Efficiencies: The one thing retailers will have to focus on is achieving cost efficiency to provide the best prices – this can be achieved by sound operations and efficient supply chain systems. Key aspects like optimal merchandise mix, IT systems, reducing shrinkage, location of the retail outlets will also prove to be key success factors.
- Value Conscious Consumers – Its simple, as a consumer, I am not always looking for a bargain and am willing to pay provided I get value for what I spend. Consumers have increased their purchases of private labels which will, in the future, have to become more sophisticated.
- Continuous Evolution – Some practices like loyalty programmes, promotional offers have evolved over the time, especially with the increase in modern trade , will have to continue to do so. Even if this means consolidation, for a more competitive environment, retailers will have to adhere to what the future dynamics will be.
All eyes will be on this sector as this gets into a newer horizon with more and more organized retailers stepping in different product segments. The game changer will be how well you respond to the changing market dynamics without drifting away from your objective of addressing consumer needs!