Retail: Ready to Explode

There is a revolution that is steadily taking shape in India and
gaining strength with the passage of each day. It is the retail revolution which
promises a complete change in the way we purchase our groceries or vegetables.
According to estimates, the Indian retail industry is expected to grow from $300
bn to $637 bn by 2015. Currently, the organized retail segment accounts for only
3-4% of the total market, but things could change as this segment (organized) is
expected to touch 18% in the next few years.

Of late there have been reports of global retail biggies making
a foray into Indian markets. Players like Wal-Mart, Tesco and Carrefours are
renowned to be tech savvy. Will Indian players be able to match with them?

It is a loud yes. Indian players are not only matching, but also
even excelling in the game of IT. Every single CIO that we spoke underscored the
importance of IT for his company's prospects.

While IT helps retailers manage their supply chain, inventory,
etc in an efficient manner, the single largest improvement is brought in terms
of customer satisfaction. "With IT we are able to run complex promotions,
which otherwise would not have been possible in a manual system thereby giving a
goof value for money for the users," says KVS Seshasai, head, IT and
Corporate Quality, Trent.

Local Flavor

Yet, IT is not the panacea for all ills. One cannot fully depend on the
off-the-shelf-solutions available in the marketplace, as Indian consumers offer
unique challenges. One needs a system that lends itself to customization and
localization, agrees Seshasai and cites an instance. "Take the case of MRP.
India is one of the very few countries that have such a concept and not many
systems are tuned to it. Fortunately, we had a system in place that made all
these customization issues pretty easy," he clarifies.

And yet retail is not all about those impressive malls, it is
also the small kirana stores that dot the Indian landscape. They seem to have
lost out somewhere. Rakhee Nagpal, MD, DVS, seems to have a solution for this.
"I strongly believe that 12 mn or so small retailers can also benefit from
the boom. After all even in the West, the mom and pop stores have held their
ground in front of large retailers. They can also use IT to their advantage in
their own small ways. There is huge opportunities and it is open to everyone,
big or small," she says.

In the Days to Come

Currently, there is a lot of talk about BI and data warehousing. RFID is
another technology that has been talked a lot about. But most of the CIOs
contend that there needs to be an ecosystem before the technology is fully
adopted and currently, the ecosystem is not ubiquitous.

Summing up, Indian retailers do not seem to be in anyway lacking
in terms of technology adoption vis-à-vis their foreign counterparts. Maybe, it
is the foreign players that need to get wary and not the other way round.

Shashwat Chaturvedi


maildqindia@cybermedia.co.in