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Cost Reduction in Supply Chain for Retailers

Contributed by Charu Gupta
Today, retailers having chain stores and numerous distributors face a big challenge of giving best services to their customers and making timely delivery of products. This problem can only be solved once a retailer’s supply chain is responsive enough to meet the consumer’s growing demand.  
 A retailer needs to strike a balance between maintaining a high level of service along with low costs. As the retailers have spread their wings globally using multi-channels and have also ventured into new categories, the supply chains have become much more complex and hard to handle. This calls for understanding the complete supply chain process and identifying the loopholes and cost occurring points in the whole cycle. 
 
DMAIC process by DHL which stands for Define, Measure, Analyse, Improve and Control is an ideal way to understand the supply chain. As you can’t control, what you can’t measure, retailers need to know the rationality behind each supply chain activity. 
 
Integrated Planning is another approach which could be helpful for the retailers in a big way. Unlike in traditional approach, where each supply chain partner whether it is at retail level, distributor level or manufacturer level creates a forecast of its own needs independent of its partners, in integrated planning forecasts are being shared between the trading partners with the goal of effective collaboration throughout the supply chain. One of its distinct advantages is that it provides scope for re-calibration.
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At the Emerging Business Forum – Footwear Industry in Agra

-Contributed by Kanak Dutta

Zee Business along with Milagrow Business and Knowledge Solutions presents ‘Emerging Business Forum’- an exclusive 10 city initiative that aims to enable and empower SME clusters to achieve sustainable development and growth. A buoyant India today is witness to many successes of small and medium enterprise. Their role in terms of employment creation, upholding the entrepreneurial spirit and innovation has been crucial in fostering competitiveness in the Indian business and economy.

Beginning December 17th 2008 (Agra), this forum is in the format of panel discussion which would be continued across ten important cities which includes Agra, Ahmadabad, Delhi, Jaipur, Indore, Ludhiana, Merrut, Moradabad, Pune and Tirupur.
The forum was first initiated in Agra which is known for Taj Mahal world over and has an enormous leather industry. This city is catering to the huge demand of footwear in the country.

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Frugal Marketing Strategy in Recessionary times

Contributed by Ankush Garg
 
When recession hits hard, consultants are the first ones to be shown the door. The next are the marketing teams. 
 
Organizations worldwide slash marketing budgets in difficult times. While the some purists contend that recession is the best time to strengthen the brand and get a competitive edge, the question is how? The funds are scarce and they need to be channeled into the essentials of the business to keep it running. 
 
While increase in the marketing budgets in difficult times may continue to a distant dream for most marketers, the circumstances offer opportunity to become more effective. The adage necessity is the mother of all invention never works better that it does in current macro-economic environment.. 
 
So how can marketers become more effective and get more bang for the buck? The first step is to segment your customers by the product categories and allocate the marketing budgets to different segments depending upon its profitability. Then develop a marketing strategy for each segment depending upon the customer profile or its behavioral traits. Seek synergies by identifying segments with similar customer profile.
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Retail Chains all geared to fight Slowdown

Country's leading retail outlets are coming up with startegies to fight from the overall slowdown in sales. Though the promotions at the year-end have given a little cheer to otherwise slowdown-hit retailers but there has been a fall in the overall sales in the Oct-Dec. period. Here too, the advantage has gone to the value-formats while high-end stores were the worst-hit. 
 
Retailers Association of India(RAI) feels that the growth of the organised retail which stands at Rs.27000 crore as against the total retail market of Rs.20 lakh crore will fall down from 35% to 10-12% in 2008-09.
 
Suspecting this, most of the big retailers are implementing various strategies like inventory optimization, supply chain efficiency, better product assortment, reducing number of SKUs, lowering the operating costs, etc. For example, Future Group is taking initiative towards customizing the product assortment according to a particular locality to suit the requirements of the people residing there. Shopper's Stop is focusing on making it supply chain more efficient by scaling down their back-end infrastructure. Tata's Landmark, the books-music-gifts retailer is looking into optimising its inventory to prevent losses and ensure better cash utilization. 
 
Reference: Economic Times
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Pricing Strategy for Small Retailers

Contributed by Richa Kapoor

One of the most crucial areas of decision making for retailers is pricing. Yet, we have found that small firms often do not have well-conceived pricing plans. A retailer's prices influence the quantities of various items that consumers will buy, which in turn affect total revenue and profit.
Hence, correct pricing decisions are a key to successful retail management. Key to small retailers prosperity in today's discount-oriented environment is guaranteed only if they have a good understanding of their niche in the marketplace.

With this in mind, the retailer should first prepare a checklist of questions that will assist him in making systematic, informed decisions regarding pricing strategies:

What is the overall pricing philosophy of the company: It's critical for the retailer to define the overall price positioning of the store… A choice has to be made between high-end…. Low-end

Target Consumer and Retailing Mix: Before fixing up the prices of the products a retailer must focus on his target consumer…. His characteristics, identify reasons of their choosing a retail store (for low prices, for convenience, for service, etc.) then a comparison should be made if the target consumer is consistent with the overall pricing philosophy.

The Central Concept Pricing: Before starting to price the products the retailer needs to decide: how do you compute prices…. When calculating prices do a retailer take is operating cost into account??

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Online marketing a buzzword today!!!!

Contributed by Charu Gupta

I was just checking my mails and found a forwarded link from my friend.
http://india.makemytrip.com/chidyaud/cidiyaudi.html

It was an animated video where a girl was playing game of ‘Chidiya ud” with her brother which we all used to play in childhood. It was great fun watching the video but at the end it turned out to be an ad from ‘Make my trip.com”. Watching the video was fun while the company was able to send its message of “now anyone can fly with their lowest airfares” very clearly to its target market.

This is a kind of online marketing also called as “Viral marketing” that makes viewers laugh and the advertisers smile. Viral marketing and viral advertising refer to marketing techniques that use pre-existing social networks to produce increase in brand awareness, through self-replicating viral processes. A two-minute animated Interactive advertising agencies like Webchutney, Media2win and Virtual Marketing are shifting focus to create online ad campaigns around animated viral videos and a lot of major brands are falling for it.

Big names like Lenovo, TataSky, Cornetto and Happydent are exploring online marketing beyond placing banner ads on various sites or pasting text on social networking sites. They are eyeing potential customers, essentially through animated viral videos, to create brand equity, eventually targeting an increase in sales.

“Animated viral renders the fun element which the Indian audience is able to relate to. Also, it is something one would like to forward to family, friends and colleagues and also has a higher recall value. By using animation as a tool, we get the freedom to create favourable situations which may not be the case with film videos,” says Webchutney creative director Prabhat Bhatnagar.

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Experiential Retailing

Contributed by Richa Kapoor

"Be everywhere, do everything, and never fail to astonish the customer"

Retail in India is at the crossroads. It has emerged as one of the most dynamic and fast paced industries with several players entering the market. Today the customer experience is fragmented. Prices, inventory, promotions and policies often differ between channels. Yet, customers want a seamless shopping experience across all channels. They want to order products online but return them to the store. They want to browse products in the store, yet order online, from a kiosk or a catalog. They want prices, return policies and promotions to be consistent across all channels.

To meet the demands of today's consumers, a solid understanding of "the customer experience" is necessary. Consumers today expect their favorite retailers to offer "experience" along with good service and a good product.

The old saying, "You never get a second chance to make the first impression," most definitely rings true in retailing. Whatever advertising and promotion precedes it, the in-store experience is where it all comes together. Creating a friendly, comfortable and professional retail environment will sets a retailer apart from the box stores.

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Delhi to host first brand licensing conference in India

Licensing experts of the world, including Tommy Hilfiger's CEO Shailesh Chaturvedi, LIMA Managing Director Kelvyn Gardner, would participate in a two-day conference starting from November 29 in New Delhi to explore the potential of the licensing industry in India.

The Brand Licensing India Conference 2008, which is being organised by Franchise India Holdings Ltd and supported by International Licensing Industry Merchandisers Association (LIMA), would focus on growth of the licensing industry in the country. "The conference will be a great platform for Indian companies to learn from Global industry professionals, to leverage best practices and knowledge in the Indian licensing industry," Franchise India Holdings President Gaurav Marya said.

The emergence of modern and more organised retail in India, estimated at USD 200 billion, has been projected to grow at five percent per annum and has set the pace for new collaborations between International licensing companies and Indian business houses. Licensing industry worldwide is estimated at USD 187 billion. Retail sales of licensed merchandise in the US and Canada in 2007 reached USD 71.25 billion and that in Western Europe has been estimated to be worth in excess of USD 26 billion.

Source: zeenews

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mjunction coming up with 'straightline'

 

mjunction, a 50:50 e-commerce joint venture of steel majors Tata Steel and Steel Authority of India Ltd (SAIL), which was till now in the online coal and steel sales and purchase space will enter the online retail business-to-consumer (B2C) segment by April 2009.

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Big retail chains would fail: Uttar Pradesh Udyog Vyapar Pratinidhi Mandal

As Indian Retailers trying their best to keep their sales register ticking in the times of global Economic Slowdown, the Uttar Pradesh Udyog Vyapar Pratinidhi Mandal comments that “India is a tropical country where per capital income is low. The large retail formats, which are successful in the US, Canada and Europe are bound to fail here.”

 
Mr.Kanchal, the president of the organisation said that establishment expenses of big retailers amount to almost 20% while it is just 4-5% for small retailers which is going to create trouble for big retail chains in the times to come.
 
Also, the Parliamentary Standing Committee on Commerce which was analysing the impact of big malls on small retailers and is expected to submit its report to the central government soon is trying to study the Malaysian and Polish legislations like Shopping Mall Regulation Act which aims to strike a balance between the  small and large retailers.
 
As retailers have started facing the heat of economic slump, do you agree with the statement that "Big Retail Chains would fail in coming future"?
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