wholesale markets

8/6/2019 Wholesale Markets

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Reality««

in Real India«..

today



Today the consumption in Real India is constraint byToday the consumption in Real India is constraint byavailability of products and not other factors.availability of products and not other factors.

How can we tap this consumption space?How can we tap this consumption space?

Consumption

Information

Money Attitude/lifestyle

Products/service availability



Our InterpretationOur Interpretation

Population is sparse,Population is sparse,

Value for money is more than urban, Value for money is more than urban,

Scared to come in a place Not For Me,Scared to come in a place Not For Me, So we may not be able to target themSo we may not be able to target them

directly,directly,

So ..So ..

Can we sell goods to retailer who sells toCan we sell goods to retailer who sells to

the consumers?the consumers?



Customer InsightsCustomer Insights

Retailer/ customerRetailer/ customer has to travel longhas to travel longdistance, so cost lots of time and money,distance, so cost lots of time and money,

No access to new productsNo access to new products

Quality assuranceQuality assurance

Unfair trade practices and lack of Unfair trade practices and lack of transparencytransparency

Consistency of quality and availabilityConsistency of quality and availability



Suppliers InsightsSuppliers Insights

Costly to build brands and distribution channelCostly to build brands and distribution channel

Relies on wholesalersRelies on wholesalers

Exploitation by wholesalersExploitation by wholesalersPayments, Prices, Stocking, ServicePayments, Prices, Stocking, Serviceparametersparameters

Forced to follow unlawful trade practicesForced to follow unlawful trade practices

Lack of loyalty from wholesalerLack of loyalty from wholesaler

No new products/line development No new products/line development



Can we create aCan we create a trading platformtrading platform toto

integrate theintegrate the supplierssuppliers andandretailers/customersretailers/customers in ain ameaningful and profitablemeaningful and profitable

manner?manner?



Brand SoulBrand Soul

Why cant small retailers buy at reasonableWhy cant small retailers buy at reasonablerates and have good quality withrates and have good quality with

consistent availability of products? Whyconsistent availability of products? Whydoes the supplier be at the mercy of fewdoes the supplier be at the mercy of fewwholesalers?wholesalers?

Can the consumer in Real India consumeCan the consumer in Real India consumesame quality goods as an urban consumersame quality goods as an urban consumerif not directly through organized retail but if not directly through organized retail but indirectly.indirectly.



Brand PhilosophyBrand Philosophy

Brand PersonalityBrand Personality Rural, Efficient, MentorRural, Efficient, Mentor

Brand PositioningBrand Positioning Give the feel of Mandi /GulliesGive the feel of Mandi /Gullies

Brand ExperienceBrand Experience All sensory (See, smell, Touch, hear and taste) All sensory (See, smell, Touch, hear and taste)

should be like a bazaar. No straight aisles,should be like a bazaar. No straight aisles,narrow spaces, earthy smell and lots of stock onnarrow spaces, earthy smell and lots of stock on

floor, SASTE KA MAAL RASTE PEfloor, SASTE KA MAAL RASTE PE



Vision Vision

To create an alternative organizedTo create an alternative organizedwholesale trading platform for Real Indiawholesale trading platform for Real India

To change the way existing retailers buyTo change the way existing retailers buyfrom existing wholesale systemfrom existing wholesale system

To change the way supplier sells toTo change the way supplier sells to

existing wholesale market existing wholesale market

Thus make products available for RealThus make products available for RealIndia consumersIndia consumers



Brand EquityBrand Equity

Peripherals* Multiple categories

* On the highways

10-15 mins distance

from BS/RS

* No Frills

* Factories to floor

CORE

³Khareedo Bachao,

Karobar Badao´

In Real India

Detractors* Credit

* Unlawful trade

practices

* Adaptability

* Existing trade

hostility



SWOTSWOT -- StrengthStrength

Organized playerOrganized player

Existing SCMExisting SCM

Group backingGroup backing

Pan India PresencePan India Presence



SWOTSWOT -- WeaknessWeakness

Availability of trained people Availability of trained people

Location, away from existing wholesaleLocation, away from existing wholesalemarket market

Varying tastes and preferences vis a vis Varying tastes and preferences vis a visurban consumer and regionalurban consumer and regional

Low margin businessLow margin business



SWOTSWOT -- OpportunitiesOpportunities

Private label creationPrivate label creation

Desire to consume is on the riseDesire to consume is on the rise

Retailers and suppliers want to know newRetailers and suppliers want to know newways of doing businessways of doing business

Platform for suppliers to try new productsPlatform for suppliers to try new products

Procurement of farm produceProcurement of farm produce

Give an alternate to existing unorganizedGive an alternate to existing unorganizedMarket in organized mannerMarket in organized manner



SWOTSWOT -- Threat Threat

Unlawful trade practices (tax evasion)Unlawful trade practices (tax evasion)

Credit systemCredit system

Trade hostilityTrade hostility



Who is our CustomerWho is our Customer

Medium and small retailers,Medium and small retailers,

Bulk consumers,Bulk consumers,

Wholesaler and semi wholesalers,Wholesaler and semi wholesalers,

Office and institutions

Office and institutions

Hotel/Restaurants/ Dhabas /CanteenHotel/Restaurants/ Dhabas /Canteen

Health and Educational institutionsHealth and Educational institutions



Product Mix StrategyProduct Mix Strategy

Aim is to provide width in terms of categories Aim is to provide width in terms of categories

with minimum depthwith minimum depth 675 MCs across 20 Departments675 MCs across 20 Departments

Overall master not to be exceed 5000 SKUS, of Overall master not to be exceed 5000 SKUS, of these 2000 SKUS will be consistent and 3000 willthese 2000 SKUS will be consistent and 3000 will

be rotationalbe rotational



Product Mix StrategyProduct Mix Strategy

Customization to local taste is a must Customization to local taste is a must

At least 20 items will be on Lot Offer and At least 20 items will be on Lot Offer andshould change once in fortnight should change once in fortnight

For each location depending on availability of For each location depending on availability of

space to offer host of ancillary services likespace to offer host of ancillary services likeBanking, Travel counters, service station etc.Banking, Travel counters, service station etc.



Department ListingDepartment Listing

Techno Mart Techno Mart Consumer DurableConsumer Durable Cycle & Spare PartsCycle & Spare Parts DisposableDisposable ElectricalElectrical Food & GroceryFood & Grocery FootwearFootwear

Fruits & VegetablesFruits & Vegetables GI SheetsGI Sheets GarmentsGarments

Hardware & Tools

Home Furnishings

Household Utilities

Ladies Accessories

Stationery

Toys & Games

Travel Accessories

Utensils Furniture

Lifestyle



Sales System & StrategySales System & Strategy

Canvassing in the catchments area of 60KM for enrolling SaathiCanvassing in the catchments area of 60KM for enrolling Saathi(members)(members)

Saathi will be charged annual membership fee, but same fee will beSaathi will be charged annual membership fee, but same fee will beredeemed in the form of Gift vouchers over preredeemed in the form of Gift vouchers over pre--decided monthsdecided months

Annual fee charged from Saathi will be refunded if not satisfied after Annual fee charged from Saathi will be refunded if not satisfied afterdeducting GV useddeducting GV used

Sale payment modeSale payment modeCashCashCredit cardCredit card

Micro finance cardMicro finance card To be worked uponTo be worked uponSelected credit to bulk buyers against Selected credit to bulk buyers against securitiessecurities




Display on pallets/binsDisplay on pallets/bins

Display in cartons (Window cut) but looseDisplay in cartons (Window cut) but loose

and not repacked, however customer hasand not repacked, however customer hasto buy minimum quantity for billing andto buy minimum quantity for billing andthat qty will be more than 1 (In most of that qty will be more than 1 (In most of the cases except CD/Mobiles etc.)the cases except CD/Mobiles etc.)

Lots of banner and wall paints will be usedLots of banner and wall paints will be usedin side and outside market to give HAATin side and outside market to give HAATlooklook




Tie up with transporter for point to point Tie up with transporter for point to point delivery on payable basisdelivery on payable basis

Unit of sale will be as per industry normsUnit of sale will be as per industry norms(steel in kg, nails in kg etc.)(steel in kg, nails in kg etc.)

Replacement guarantee if unused and inReplacement guarantee if unused and in

original packingoriginal packing



Pricing & Promotion StrategyPricing & Promotion Strategy

8080--100 Key Value Items at prices equal or below100 Key Value Items at prices equal or belowbenchmarked wholesale prices. Eg.benchmarked wholesale prices. Eg.

For NorthFor North Sadar BazaarSadar BazaarFor West For West Maszid BandarMaszid Bandar

For East For East Bada Bazaar,Bada Bazaar,

All other items at par or below local wholesale All other items at par or below local wholesalemarket market

Level 1 will be considerably lower than the RetailLevel 1 will be considerably lower than the RetailMOP vis a vis the margin earned in the product MOP vis a vis the margin earned in the product and level 2 will be at wholesale prices asand level 2 will be at wholesale prices as

indicative aboveindicative above



Pricing & Promotion StrategyPricing & Promotion Strategy

Power pricing with 2Power pricing with 2--3 levels depending on item,3 levels depending on item,

Purchase based monthly loyalty schemes to bePurchase based monthly loyalty schemes to be

operated regularlyoperated regularly At least 1 to 2 items from each category will be At least 1 to 2 items from each category will be

on offer price and the promotion cycle will be 2on offer price and the promotion cycle will be 2weeks,weeks,

All commodity items swing with the benchmark All commodity items swing with the benchmarkmarket irrespective of purchase pricemarket irrespective of purchase price

Detailed process of benchmarking of prices to beDetailed process of benchmarking of prices to bedevelopeddeveloped



Sourcing StrategySourcing Strategy

Short term (0Short term (0--3 mths)3 mths)

To make sure all the regular products are thereTo make sure all the regular products are there

at the price points currently available to theat the price points currently available to theretailers/traders.retailers/traders. Focus on Range and Category fulfillment.Focus on Range and Category fulfillment. Correction of items and range based on theCorrection of items and range based on the

trends, tastes and preferences from thetrends, tastes and preferences from the

customers side.customers side. Initial Sourcing will be from best possible sourceInitial Sourcing will be from best possible source

available either from Manufacturer oravailable either from Manufacturer orConsolidatorConsolidator




Short term (0Short term (0--3 mths)3 mths)

Experimentation regarding new productsExperimentation regarding new products

innovation will be lessinnovation will be less Private label will be in selected MerchandisePrivate label will be in selected Merchandise

Categories (Min 10%) but with high focus.Categories (Min 10%) but with high focus.

To ensure direct sourcing by at least 20 %To ensure direct sourcing by at least 20 %




Medium term (4Medium term (4--6 mths)6 mths)

Consolidation of product assortment .Consolidation of product assortment .

Vendor Development process to be initiated and Vendor Development process to be initiated anddeveloped.developed.

Study and Analysis of the buying trends of Study and Analysis of the buying trends of

different class of customers along with thedifferent class of customers along with theweight age given to categories/items.weight age given to categories/items.




Medium term (4Medium term (4--6 mths)6 mths)

Study of customer inclination towards newStudy of customer inclination towards new

innovative or upgraded products.innovative or upgraded products. Finalisation of Private Label program andFinalisation of Private Label program and

initiation of the same. Target Share of Privateinitiation of the same. Target Share of PrivateLabelLabel--25%25%

Target Share of Direct SourcingTarget Share of Direct Sourcing -- atleast 35%.atleast 35%.




Long term (7Long term (7thth mth onwards)mth onwards)

Migration from Supply driven to Demand drivenMigration from Supply driven to Demand driven

(Make What is selling rather than selling what (Make What is selling rather than selling what has been made)has been made)

Focus on Cost / Margin / ProfitabilityFocus on Cost / Margin / Profitabilitymanagement: Emphasis on making themanagement: Emphasis on making the

management of sourcing more efficient in termsmanagement of sourcing more efficient in termsof effort and cost?of effort and cost?

To Improve Suppliers Performance Capability.To Improve Suppliers Performance Capability.

Try new product innovationsTry new product innovations




Long term (7Long term (7thth mth onwards)mth onwards)

Decisions Make or Buy Or Import to be takenDecisions Make or Buy Or Import to be taken

and implemented.and implemented. Target Share of Private Label > 70%Target Share of Private Label > 70%

Target Share of Direct Sourcing > 75%Target Share of Direct Sourcing > 75%



Private Label StrategyPrivate Label Strategy

High basket penetration MCs.High basket penetration MCs.

Low technology products.Low technology products.

Surplus capacity available.Surplus capacity available. Cost to be at least 20Cost to be at least 20--25% below benchmark25% below benchmark

SKU.SKU.

Wholesale Price to be at least 30% belowWholesale Price to be at least 30% below

benchmark SKU.benchmark SKU. Target the manufacturer with experience inTarget the manufacturer with experience in

dealing with a national brand preferably.dealing with a national brand preferably.



SCM StrategySCM Strategy

Factory to floorFactory to floor

Inventory norms 36 stock turnsInventory norms 36 stock turns Supplier to repack whenever we intent to andSupplier to repack whenever we intent to and

label the product label the product Endeavor to use EAN code and also ensure allEndeavor to use EAN code and also ensure all

long term suppliers adhere to the EAN codinglong term suppliers adhere to the EAN codingstandard.standard.

On affixed barcodes MRP/SP not to beOn affixed barcodes MRP/SP not to bementionedmentioned



SCM StrategySCM Strategy

Implementation of web based orderingImplementation of web based ordering

Implementation of Auto Ordering System isImplementation of Auto Ordering System iscritical and compulsorycritical and compulsory

Future Logistics to suggest ways of minimizingFuture Logistics to suggest ways of minimizing

transportation cost transportation cost



Information TechnologyInformation Technology

Implementation of SAP as per business needsImplementation of SAP as per business needs

REM configuration as per business needsREM configuration as per business needs

Time chart of business blue print Time chart of business blue print

Resolving of issues like MC, EAN Codes,Resolving of issues like MC, EAN Codes,

Implementation of MIS/BiWImplementation of MIS/BiW Planning for IT architecturePlanning for IT architecture

Planning and sizing of IT infrastructurePlanning and sizing of IT infrastructure

wholesale markets

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