Sunil Jindal, Managing Director, SRS Limited, which runs the neighbourhood convenience format SRS Value Bazaar stores in Delhi-NCR, spoke to Progressive Grocer about how his 25-store chain has been able to thrive in a difficult and intensely competitive retail market by careful selection of the location and product range to suit the needs of the store’s catchment and by offering its customers a premium, safe and pleasing ambience in its stores.
Describe the journey of your store over the years and its growth trajectory?
SRS Retail is the business vertical of SRS Group. We are into retailing under the brands SRS Value Bazaar. Our first retail store was launched in January 2006 in Faridabad. Today, the Group operates 25 retail stores for Value Bazaar and 10 other exclusive stores. Currently, we are spread across Delhi-NCR, Uttar Pradesh and have some stores in Haryana. Apart from SRS Value Bazaar, we have SRS Cinemas, SRS Jewelry, SRS Real Estate and SRS Education under the group. The retail venture of the group operates through consignment and buy outright models. We have also collaborated with a number of business conglomerates such as HUL, ITC, PNG, Coke and Pepsi. All outlets operated by SRS Limited are expanding at a healthy pace. We plan to launch 10 to 15 more retail stores within a year.
What are the marked differentiators for your stores? Which are those elements that have become the hallmark of your stores?
Our stores are convenience, super convenience format and have the features of both. We have stores as small as 700 sq.ft and as big as 7,000 sq.ft. The underlying concept behind our stores is to serve as a neighbourhood stores in localities that have high-rises with a good residential population. The size and the number of stores is small and as neighbourhood stores we target customers within 1 km of radius. Our staples and own store label is another key hallmark that sets us apart from many other food grocers. The stores have a wide range of products across a vast array of brands and are available in various package sizes to suit everyone’s needs.
Give us an overview of how you allocate the shelf space to the different categories in your store?
Our sales is divided into food and non-food products. The food products’ category makes up 65 per cent of our sales, while the non-food products’ category accounts for 35 per cent. In terms of shelf display, we put staples at the back and other food categories including fresh fruit and vegetable at the front. This shelf plan and arrangement ensures that the customers take a complete tour of the store. The non-food items are aligned in one row and include beauty care, detergent, clinical care and other household items.
What is the location strategy for your stores?
Store location is very important as having a good location increases the chances of developing a strong sustainable competitive advantage. Our location strategy is to be in and around shopping centers, malls, and local markets. The primary consideration is that the location should be convenient for customers and should have facilities like parking space.
What is the customer profile at your stores? Has the customer profile been changing in any way over the years?
People between the age group 20 and 40 years are frequent visitors to our stores. The customer profile has been changing in so far as we are seeing more and more people looking for a hassle-free shopping experience. To cater to the requirements of our customers, we provide them a premium, safe and pleasing ambience in our store along with a skilled team of executives to care of their shopping needs.
What are the trends in your stores for major grocery categories?
We are seeing an increasing trend in free home delivery. Customers are also showing a higher preference for buying health and wellness products and herbal products. So consumers are putting greater emphasis on quality, convenience, value and service, and these are the trends likely to gain in strength in the future.
Are there any interesting concepts or innovations you have introduced at your stores?
As an FMCG retailer, we keep introducing various variants of FMCG brands and added variation in products from time to time. We also change the layout of the store at times. Our efforts are geared towards stocking a product line that best serves our customers and to keep it fresh and exciting at all times.
Have you developed your own loyalty program/ schemes/ offers for pushing sales? What has been their impact on sales, turnover, etc?
Yes, there are some schemes and offers that we provide to our customers on a regular basis. These include weekly discounts, festive benefits and much more. We have witnessed an increase in sales and footfalls during the period of such offers.
As a neighbourhood convenience store, what has been your experience managing your store operations and merchandising?
Delhi-NCR is a difficult market because of the different requirements of the customers. One needs to manage store operations and merchandizing by taking into account the needs and requirements of your customer base.
Which marketing and promotional activities do you prefer for pushing sales in your stores?
Among the promotional activities we prefer is to sell directly to the consumers through kiosks and other point-of-purchase displays. From time to time we offer special deals, give away free samples of a new food product, ensure high visibility of the products on shelves and their placement near check-out counters.
What has been your experience of utilizing and leveraging technology for your store format?
We took the initiative to foray into e-commerce and start our online stores, but the response from customers was not satisfactory. It didn’t work and we found its operations expensive. We have now launched our mobile applications under which customers can order products from the app and get it delivered to their home.
Going ahead, will you concentrate on growing online or taking your store count up?
We are planning to grow both online and offline.
So what’s in store for the future by way of your expansion?
We are planning to open more stores with national as well as international products to fulfill the needs of our customers. Our store expansion will take place in the smaller cities around the regions where we have our operations at present and later we will expand to more metro cities in India.
What do you feel has been your strengths and achievements so far?
We are the first in Delhi-NCR to be termed as neighbourhood store. We have been there for 10 years in Faridabad and Gurugram.