With the opening of the multi brand retail sector to foreign players being almost certain, Kirana stores will be phased out, thankfully however it might not happen over night. Every country in the world ( including the only 400+ yr old USA) have had a history of Mom & Pop stores. In the developed world more than 90% of retail is controlled by large chain stores and I am certain the same will happen in India, despite all the arguments trying to fool people into believing that Kirana will co-exist with large retailers.
As a society, letting go of entrepreneurs to be replaced by servants is really sad.
There might be some advantages of scale being passed on to customers, and surely efficiency in the sector will improve manifold with large foreign players.
To me, more than the opening up organised retail or its impact on Kirana stores, I love the strategy of major retailers of India.
A few years ago when the debate about allowing FDI had started, Indian companies screamed that it was necessary to give some time for Indian retail companies to build brands before foreign companies are allowed entry. Today all large organised retailers are very eager to open up the sector for FDI. The change in stand is not a change of heart but purely a pragmatic decision in the interest of promoters of the Indian retail companies.
Subhiksha, and Vishal are good examples of building the front end with very poor back end that resulted in failure. Had they had the ability to survive till now, and work on Market capitalization ( the Gayathri mantra of organised retail promoters in India) , they might have been picked up by a foreign company like many others are hoping to be today.
Recent IPO's in the sector have bombed at the retail stock market, more than one take over is begging revaluation/revised due diligence. Come large foreign retailers, Give Indian businessmen super returns for building great market capitalization and maybe dud organizations with some nice real estate potential.
From Sher Shah Suri who initiated Kirana, to India's famed PDS ( ration shops) , Indian retail companies and now global retailers it has been a long journey. Are there other sectors we can start Indian companies with a hope of selling them to global giants at a good price with opening up and timing support from government. Do write in. I am sure many of you think this is a cynical view, to me and hopefully to some of the readers this is a reasonably objective view!
Circa 2007
Biyani doesn't buy all that, arguing that "India is a nation of dukaandars (shopkeepers) and that enough retail talent is available. He also dismisses concerns about distribution and logistics infrastructure with a simple, rhetorical question: "Have you [in the recent past] faced a shortage of anything you wanted to buy?" Biyani scoffs at Wal-Mart's logistics and supply-chain strengths. "Where will they run their Volvo trucks here?" he asks, adding in a lighter vein, "They will probably have to have bullock carts and handcarts in their supply chain." Wal-Mart enters India
Will Wal-Mart succeed in India? Perhaps... but it won't be easy.http://www.freshplaza.com/2007/0213/re_in_wal-mart.html
Circa 2005
As a society, letting go of entrepreneurs to be replaced by servants is really sad.
There might be some advantages of scale being passed on to customers, and surely efficiency in the sector will improve manifold with large foreign players.
To me, more than the opening up organised retail or its impact on Kirana stores, I love the strategy of major retailers of India.
A few years ago when the debate about allowing FDI had started, Indian companies screamed that it was necessary to give some time for Indian retail companies to build brands before foreign companies are allowed entry. Today all large organised retailers are very eager to open up the sector for FDI. The change in stand is not a change of heart but purely a pragmatic decision in the interest of promoters of the Indian retail companies.
Subhiksha, and Vishal are good examples of building the front end with very poor back end that resulted in failure. Had they had the ability to survive till now, and work on Market capitalization ( the Gayathri mantra of organised retail promoters in India) , they might have been picked up by a foreign company like many others are hoping to be today.
Recent IPO's in the sector have bombed at the retail stock market, more than one take over is begging revaluation/revised due diligence. Come large foreign retailers, Give Indian businessmen super returns for building great market capitalization and maybe dud organizations with some nice real estate potential.
From Sher Shah Suri who initiated Kirana, to India's famed PDS ( ration shops) , Indian retail companies and now global retailers it has been a long journey. Are there other sectors we can start Indian companies with a hope of selling them to global giants at a good price with opening up and timing support from government. Do write in. I am sure many of you think this is a cynical view, to me and hopefully to some of the readers this is a reasonably objective view!
Circa 2007
Biyani doesn't buy all that, arguing that "India is a nation of dukaandars (shopkeepers) and that enough retail talent is available. He also dismisses concerns about distribution and logistics infrastructure with a simple, rhetorical question: "Have you [in the recent past] faced a shortage of anything you wanted to buy?" Biyani scoffs at Wal-Mart's logistics and supply-chain strengths. "Where will they run their Volvo trucks here?" he asks, adding in a lighter vein, "They will probably have to have bullock carts and handcarts in their supply chain." Wal-Mart enters India
Will Wal-Mart succeed in India? Perhaps... but it won't be easy.http://www.freshplaza.com/2007/0213/re_in_wal-mart.html
Circa 2005
India : Retailers not keen on FDI within sector July 20, 2005 | ||
Most of the retailers do not want Foreign Direct Investment (FDI) in the Indian retail sector emerged from the 'Retail 2005' seminar organised by CII in Kolkata last week. Except for real estate segment, which is eyeing huge foreign (particularly NRI) funds want FDI to boost the industry future. Clearly speaking out against FDI were Pantaloons Retail Limited managing director, Kishore Biyani and Vice-Chairman of RPG Enterprises Sanjiv Goenka who clearly outlined that there was no need for allowing FDI in the retail sector. A three year time frame to study the situation and then take necessary step in the the direction were sought by the opponents of FDI in the sector. Some organised retailers are mulling to appeal to the Government on this issue. http://www.fibre2fashion.com/news/textile-news/newsdetails.aspx?news_id=2868 Circa 2011 Retailers up on FDI clearance reportShares of Pantaloon Retail rose nearly 8 percent, after a government panel on Friday recommended opening up India's multi-brand retail sector to foreign direct investment, several dealers said. "News reports that the Committee of Secretaries has cleared the proposal to allow foreign direct investment (FDI) in multi-brand retail is an unequivocal positive for Pantaloon, in our view," Morgan Stanley said in a note.
Retail FDI to bring more choices for consumers |