Business – Q&A Bharti Retail’s Vinod Sawhny
Bharti Retail’s Vinod Sawhny on what has been the cornerstone of the retail footprint of Bharti retail with Easyday and Easyday Market.
Easyday has been conservative in spreading its retail wings. Why?
Our approach has been experimental because organised retail is nothing much to talk about in the country. The last 24 months helped us arrive at a better approach — from customer offerings, merchandise range to supply chain. Plus the collaboration with Wal-Mart has given us access to global practices. With the 30 Easyday stores and 2 Easyday Market (the compact hypermarket), we have developed a profitable prototype. We are sticking to the target investment of $ 2.5 bn by 2015 and target cities with one million population. We plan to double the store count by middle of next year.
Retail plans by players are in a limbo given the economic environment, what lessons have you incorporated to ensure that Bharti retail doesn’t make the same mistake?
The entire strategy to consolidate before moving to new markets has paid off. We have been prudent in our investment, for example, when the rentals headed north in the last two years, locking in on space which accrued to 3-4 % of sales wasn’t viable. Now that rentals are lower , we are looking to expand, both through lease and company owned models. So we will continue to consolidate in the North, but South and Western India look attractive because modern trade has evolved in these markets. We are putting in place the go-tomarkets strategy.
What has been your experience of category management, keeping in mind the fact that Wal-Mart has immense experience of working with manufacturers?
We have been leveraging a lot of learning particularly from Wal-Mart’s experience of working with manufacturers across the globe. So the collaboration allows us access into Wal-Mart’s research on brands and understand how it works across markets. At Easyday we have an apparel brand called George, a Wal-Mart private label on which the retailer is constantly doing a lot of research on trends, buying behaviour across markets. So not only does it give me the advantage of putting the right brands on the shelf without investing resources but also gives us the global sourcing access through Wal-Mart . All manufacturers realise that modern trade forms a substantial part of the business particularly in major metros. For example, when PepsiCo launched Nimbooz, it was tested in Easyday stores. So the relationship is that of partnership and not conflict because success for both hinges on working together.
How are you ensuring that your model reduces inefficiencies that usually plague retail operations when it comes to supply chain management with vendors?
The stepping stone in ensuring efficiencies has been the technical collaboration with Wal-Mart . This has enabled us to acquire global practices in creating a strong back end. Further the global leverage of Wal-Mart enables us to get the best deals from markets the world over. This then translates into Easyday providing the products at the most competitive prices.
Will the Easyday Market concept adopt a B2B role in someways to service the kirana stores along with Bharti Wal-Mart cash and carry stores?
Modern trade will co-exist with kirana stores and Easyday will purely be a B2C model while the cash and carry format will be B2B business targetted towards kiranas. Through Easyday and Easyday Market we cover a wide range in both foods and non-foods segment.
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