Spencer’s must sort out real estate, manpower & perception problems
Most upcoming organised retail chains tend to hype on their price competitiveness. So is it the sole differentiator that works? At least Spencer’s Retail, which recently announced a capex of Rs.25 billion by 2010 to set up a series of multi-format retail outlets in India, doesn’t seem to think so, as they cater to what they call the ‘business class’ of Indian customers.
“It’s quality, range & assortment that attracts a customer to the retail store. Then there is convenience in terms of location,” argues Samar Singh, Vice President, Spencer’s Retail. Price, according to him, comes after these factors. For assortment, Spencer’s normally keeps three types of merchandise: national, regional & imported goods, and their products, according to Samar, come at prices that are “not unreasonable”, indicating how they focus more on the shopping experience per se. They follow this approach to merchandise in all their verticals. Spencer’s defines its target audience as ‘female, sec a category, in the age group of 25-34, married and with children (she could be at home or working).’ The formats it currently owns are daily (218), express (154), hypermarts (15) & supermarkets (13).
Strangely, Spencer’s is not so worried about the issue with farmers, a thorn in the flesh of some major organised retailers today. Samar points put proudly how they have not faced any problem on this front. They don’t source directly from farmers, neither do they undercut them; two prime factors, according to Samar, that minimise the possibility of conflict.
Most upcoming organised retail chains tend to hype on their price competitiveness. So is it the sole differentiator that works? At least Spencer’s Retail, which recently announced a capex of Rs.25 billion by 2010 to set up a series of multi-format retail outlets in India, doesn’t seem to think so, as they cater to what they call the ‘business class’ of Indian customers.
“It’s quality, range & assortment that attracts a customer to the retail store. Then there is convenience in terms of location,” argues Samar Singh, Vice President, Spencer’s Retail. Price, according to him, comes after these factors. For assortment, Spencer’s normally keeps three types of merchandise: national, regional & imported goods, and their products, according to Samar, come at prices that are “not unreasonable”, indicating how they focus more on the shopping experience per se. They follow this approach to merchandise in all their verticals. Spencer’s defines its target audience as ‘female, sec a category, in the age group of 25-34, married and with children (she could be at home or working).’ The formats it currently owns are daily (218), express (154), hypermarts (15) & supermarkets (13).
Strangely, Spencer’s is not so worried about the issue with farmers, a thorn in the flesh of some major organised retailers today. Samar points put proudly how they have not faced any problem on this front. They don’t source directly from farmers, neither do they undercut them; two prime factors, according to Samar, that minimise the possibility of conflict.
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
and Arindam Chaudhuri (Renowned Management Guru and Economist).
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