IIPM Ranked No. 1 B-School In Global Exposre - Zee... Bharti Retail is all set to roll out its first few EasyDay stores in Ludhiana and Chandigarh. Where’s the hype and hoopla? Why is Mittal not screaming about his big ticket retail foray from the rooftops? Has Bharti discovered a new method to the organised retail madness? SAVREEN GADHOKE takes a peep behind the drawn curtains...
For now, steering away from metros is indeed a smart move, for it will benefit Bharti in more than one way. Not only are cities like Delhi and Mumbai always under public scrutiny, but even rentals here are quite high as compared to Tier II and Tier III cities. Rajat Gupta, General Manager-Marketing, Big Apple says, “Going by the current scenario, real estate has been a major challenge for the organised sector. Prices of real estate in metro cities have forced organised retailers to target Tier II cities to kick off their ventures.” Besides, Bharti being a relatively late entrant in the retail space, has to fight competition from other established players like Big Apple, Subhiksha, More (from the Aditya Birla Group), Spencers, etc. Says Pavas Bhatia, Associate Director, KSA Technopak, “Bharti does not want to be judged and be a part of the clutter in the first go itself.” Clearly Bharti does not want to compete with well entrenched players at the beginning of its innings, not from fear of being bowled out, but of becoming a part of the clutter with minimal product differentiation. For example, Big Apple has a vast footprint in Delhi as it owes its origin to the city. Says Gupta, “Big Apple has always enjoyed the benefit of being the first mover in Delhi and will continue to do so.”
Clearly, Bharti has done its homework well and is ready to sit for the examinations. But how would the market dynamics change with one more player entering the crowded organised retail mart? Well, the market seems fairly optimistic as Subramaniam says, “The market is growing at a steady pace and having more players would mean more opportunities for everybody to expand.” Given that organised retail, especially fresh fruits and vegetables, has huge potential and an ever-growing consumer base, competition is clearly not an issue, at least for now. Food and groceries retail itself accounts for almost 60% of the $10 billion estimated potential of the total organised retail in India. Ostensibly, there is room for everybody to co-exist.
Where on one hand, fresh avenues are being explored by new players; existing players too have their hands full and are busy attaining new heights. As Raghu Pillai, President and CEO, Operations & Strategies, Reliance Retail told 4Ps B&M, “We are working toward achieving our ambitious target of 80-100 billion square feet of retail space in India in the next few years. Competition is not a botheration.”
Coming back to Bharti Retail, the market-pulse is positive, no hype and no unwanted furore. The next big thing, however, is that how will Bharti compete with others of its genre. According to Maheshwari, Bharti’s branding strategy is simple. “Bharti wants to reflect the image of local retailers serving the needs of local people,” says Maheshwari. Reportedly, Bharti EasyDay store size will vary from 1500 to 3500 sq. ft. As the name signifies, these stores will be consumer friendly outlets with 70-75% situated in residential localities and remaining in commercial properties. Though not necessarily 24X7, store timings may extend to late night hours. For the small store format, it is expected that Bharti Retail may partner with local retailers through franchise model, either on revenue sharing basis or via fees for using its brand name.
Be that as it may, Rajan Mittal, the man handpicked by Sunil Bharti Mittal to head Bharti’s retail foray, has played it smart. He’s taken lessons from Mukesh’s experience and is not giving the vultures any chance to feed on Bharti’s retail venture. However, Mittal should not forget that the trouble with using someone else’s experience as a guide is that often the biggest lessons come after the final exams are over.
For now, steering away from metros is indeed a smart move, for it will benefit Bharti in more than one way. Not only are cities like Delhi and Mumbai always under public scrutiny, but even rentals here are quite high as compared to Tier II and Tier III cities. Rajat Gupta, General Manager-Marketing, Big Apple says, “Going by the current scenario, real estate has been a major challenge for the organised sector. Prices of real estate in metro cities have forced organised retailers to target Tier II cities to kick off their ventures.” Besides, Bharti being a relatively late entrant in the retail space, has to fight competition from other established players like Big Apple, Subhiksha, More (from the Aditya Birla Group), Spencers, etc. Says Pavas Bhatia, Associate Director, KSA Technopak, “Bharti does not want to be judged and be a part of the clutter in the first go itself.” Clearly Bharti does not want to compete with well entrenched players at the beginning of its innings, not from fear of being bowled out, but of becoming a part of the clutter with minimal product differentiation. For example, Big Apple has a vast footprint in Delhi as it owes its origin to the city. Says Gupta, “Big Apple has always enjoyed the benefit of being the first mover in Delhi and will continue to do so.”
Clearly, Bharti has done its homework well and is ready to sit for the examinations. But how would the market dynamics change with one more player entering the crowded organised retail mart? Well, the market seems fairly optimistic as Subramaniam says, “The market is growing at a steady pace and having more players would mean more opportunities for everybody to expand.” Given that organised retail, especially fresh fruits and vegetables, has huge potential and an ever-growing consumer base, competition is clearly not an issue, at least for now. Food and groceries retail itself accounts for almost 60% of the $10 billion estimated potential of the total organised retail in India. Ostensibly, there is room for everybody to co-exist.
Where on one hand, fresh avenues are being explored by new players; existing players too have their hands full and are busy attaining new heights. As Raghu Pillai, President and CEO, Operations & Strategies, Reliance Retail told 4Ps B&M, “We are working toward achieving our ambitious target of 80-100 billion square feet of retail space in India in the next few years. Competition is not a botheration.”
Coming back to Bharti Retail, the market-pulse is positive, no hype and no unwanted furore. The next big thing, however, is that how will Bharti compete with others of its genre. According to Maheshwari, Bharti’s branding strategy is simple. “Bharti wants to reflect the image of local retailers serving the needs of local people,” says Maheshwari. Reportedly, Bharti EasyDay store size will vary from 1500 to 3500 sq. ft. As the name signifies, these stores will be consumer friendly outlets with 70-75% situated in residential localities and remaining in commercial properties. Though not necessarily 24X7, store timings may extend to late night hours. For the small store format, it is expected that Bharti Retail may partner with local retailers through franchise model, either on revenue sharing basis or via fees for using its brand name.
Be that as it may, Rajan Mittal, the man handpicked by Sunil Bharti Mittal to head Bharti’s retail foray, has played it smart. He’s taken lessons from Mukesh’s experience and is not giving the vultures any chance to feed on Bharti’s retail venture. However, Mittal should not forget that the trouble with using someone else’s experience as a guide is that often the biggest lessons come after the final exams are over.
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