Day 2 at The SHOP, Bangalore, took off with the highly motivating CEO Meet session, presented by Nokia, on the success stories of South-based retailers. While the session observer was AT Kearney principal, Raman Mangalorkar, the expert panel included BA Srinivas from Viveks, A Mahesh Raju from Digital Shoppy, VP Harris from Witco, Hemanth Bothra from Trust Chemist and C Gopalakrishnan from N supermarket & Yeti Refrigeration.
One of the key issues addressed at the session involved the process of going national from being a strong regional player, including the sensitive issue of ‘letting go’/’handing over’ of a family-owned/entrepreneur-led business to a professional management unit. Since the panel included decades-old, family-owned retail establishments (like Nilgiris and Viveks) as well as much younger entrepreneur-led businesses (like Digital Shoppy), issues, challenges and problems were dealt with from every possible perspective.
Right from logistics and supply chain issues to people problems were shared and discussed from a realistic point of view. It was acknowledged that it was definitely not plausible for regional players to match the investments, scales and risks of national players. As pointed out by BA Srinivas, “Managing both profits and scales together, rather than scale alone, is of very high importance to small, regional players.”
Raju, meanwhile, was of the opinion that choosing to excel in super-segments of various retail categories is a winning strategy for as-yet small-scale retailers like him who are still on the learning curve and plan to hit it big eventually. “Once you put your pieces in place, get your back-end and your people together, understand the size of the market and the growth potential of your retail segment, its all about a little time before any player can establish a pan-India presence.
It was agreed by all present that southern retailers had a more conservative attitude to building up scale and going national, that they preferred to first set up strong roots in their own cities and regions before venturing out. A very sure and steady approach to take in our opinion; and it is this patient and committed work ethic that sets the south apart from the rest of the country.
Most of the panelists present had plans of going national, with more than 200 hundred outlets, by 2012. Interestingly, Digital Shoppy revealed plans of opening 500 stores in 75 tier-II and III towns and cities of India in five years’ time. Viveks, a Rs.500 crore retail company at present, will launch 100 more stores in South India by 2010 with a turnover target of Rs.1,500 crore; and by 2012, Viveks plans to expand into the West. Witco plans more than 200 outlets in Delhi and other metros, while Trust Chemists also have plans to reach 200 outlets in five years’ time.