escape velocity

Theyхотелско обзавеждане were happy-go-lucky middle-class software engineers, having finally arrived in life with a job in a good top-tier IT company. Their loyalty was regularly rewarded with stock options. Their wives’ fathers found them ‘stable’ enough on Shaadi.com to give their daughters in marriage. Their banks declared unbounded love for them by giving them a housing loans, car loans, Plasma TV loans and ‘Gold’ credit cards. And many of them recently moved in to their new apartments. Proud parents and happy relatives filled their lives. All was well, until everyone of them woke up one morning to learn that their CEO turned out to be a conman, ponzi scheme maker, fraudster of a global scale!!! All of a sudden, the sticker of company logo on their car looks embarrasing, so does wearing the company identity badge on their way to work, no one seems to know the future of their company, everyone’s speculating and gossiping, it’s top management has crumbled, and it’s stock’s fallen to pennies. All of this for no fault of the employees. They’ve been a sincere and loyal employees. And, they are now rewarded for their sincerety by slashing salaries for the next two months, and giving every one in 5 chaps a pink slip.

Adding to their woes, the next day, their banks send them short messages that their credit cards have been blocked as the bank’s exposure to their company has turned out to be a risky proposition. Their lenders are calling in to check if they can pay the monthly installments on all loans. Neighbours and curious to know what’s happening in their lives. All of a sudden, everyone in the colony seems to know that these blokes work for this infamous company. Their morale’s hit a new low, local media companies want to know how they feel on camera. Television channels and newspapers are ripping apart their employer’s name. Suddenly, everyone of them seems to be guilty by association…

And, so is the case with every one of Satyam’s 50,000+ employees. Poor chaps. I sincerely hope their tough times come to pass. No one deserves to be pained because of a few assholes like Ramalinga Raju, his family and cronies!

As large institutional players entered the Indian retail business, many debated the death of small kirana stores (as mom and pop shops in India are called).

Many financial newspapers like the Economist flip-floped with articles once predicting the demise of the small shop owner, and once discussing whether big retail can survive in India.

People like Kishore Biyani from Future Group made statements like “Kiranas have clearly won the first round” blah blah!

After going on a rapid expansion spree, the CEO of one of India’s larger Retail groups, Aditya Birla Retail  tells the Economic Times that fast growth and wrong choice of locations coupled with high rentals is to blame for all the mess-ups.

I guess there are many more reasons apart from those being laid out, and somewhere no one is admitting that they screwed up in assuming that the Indian growth story will result in a retail business environment similar to the ones seen in the Western world.

I feel retail giants in India recruited highly paid management executives who had no clue about the market they were operating in, and who experimented with their employers’ monies! And, large retail businesses are growing in general, so no one’s head is on the chopping block! Well….not yet. And, there is nothing for them to fear considering the overall retail business in India is set to grow at 13% a year!

I for one believe that India isn’t and will never be a country designed for large format retail to rule the roost. The country does not have the right transport infrastructure to support such establishments to begin with.

Countries where large format retail rules are countries with transport infrastructure and urban planning that facilitate such shopping experiences. These countries also do have a more-or-less homogeneus average customer profile, unlike India where only a small percentage of the population can afford a huge shopping basket every time they step out! A majority of Indians buy what they need on a daily basis or a weekly basis at most. Vegetables are picked up every day, and the average housewife does not walk to the supermarket everyday. Only busy software professionals, BPO workers, working couples and singles tend to pick up processed/pre-cut vegetables. It is here that the vegetable vendor around the corner turns out to be convenient.

Most, rather all supermarkets do not have proper parking lots, nor do people like to drive to a supermarket to shop for a couple of dollars. Supermarket chains do not deliver at home, small stores do.

Why don’t companies interested in the retail business develop models that are more suited for Urban and rural Indian customer profiles keeping in mind the fact that infrastructure, transport, social and economic realities of this country are really not suited for large format retail, atleast not in the way it is, today!

Why don’t they experiment with home-delivery, catalogue shopping, discount retail etc. Why not optimize on retail window space and deliver some from warehouses. Many housewives in India telephone their local kirana store and order stuff by phone!!! Large format retail businesses seem to be too stuck-up!