The rise of SMRs (Small and Medium Retails) and the role of IT…

Hello Friends!

The organized retailing in India has embarked on swifter evolutionary tracks. Despite ceilings on FDIs, a large number of foreign retail brands are entering the Indian market. Domestic business houses have got good opportunities for tying-up nuptial knots with these aspiring foreign brands, giving rise to an eclectic-natured retail culture in India. By 2011, the organized Indian retail market is expected to cross the $50 billion mark, where apparel, along with food and grocery items constitute the core of organized retailing.

The unfolding saga of organized retailing in India has violently stirred up the stereotyped un-organized retailers ($325 billion industry) of the country. Feeling challenged, India is witnessing unprecedented survival zeal on the part of the trading community who’re resorting to every means fair to confront the inevitable onslaught. A good number of un-organized retailers are trying to imbibe the characteristics of organized retailing, primarily by automating POS (Point of Sale), and supply chain issues. Even though, they’re small in scales, they’re implanting new business methodologies. India is seeing, a massive graduation of corner shop owners, engaged in traditional modes of retailing, into brave entrepreneurs who want to take the battle to the hearts of organized retailing enclaves.

A decade back, India saw a similar kind of mushrooming of IT entrepreneurs who became today’s large business entities. If we analyze, there’s an intimate relationship between IT and retail. Without IT, any efforts towards giving people the ‘retailing experience’ would end-up in a pathetic abortion. Now, this circumstantial friendship between IT and retail can do miracles for the nation. Apart from consolidating their positions in the domestic market, these SMRs (small and medium retails), can look for foreign ventures. As per A. T Kearney’s annual report, a large number of developing countries are becoming hot destinations for investments from big retailers of US, and Europe.

Here is the opportunity for Indian SMRs. Be it Vietnam, Laos, Cambodia, Indonesia, Sri Lanka, Egypt, Tanzania (including islands of Pemba & Zanzibar), Nigeria, Algeria, Morocco, East European countries, Brazil, and Argentina among others; all are seeing the emergence of organized SMRs. The aspiring Indian SMRs can tie up with their counterparts in these countries, and harness their relationships fruitfully. Apart from investments in hard currency, some kind of ‘bartering’ can also be effected. Suppose, if an Indian SMR sources clove from Pemba & Zanzibar (Tanzania), black pepper can be reciprocated from India. In India, banking institutions can do some kind of priority lending to these growing organized SMRs, so that foreign ventures get smooth sailings.

King Ferdinand & Isabella of Spain commissioned the voyages undertaken by Columbus, can’t Indian banks, and financial institutions support the modern day re-discovery of a different world by the Indian SMRs? Not only that, the Indian government can play big roles in terms of creating level playing fields for the Indian SMRs who wish to swim in the international waters.

If this happens, the Indian IT firms, small and medium sized, would get the opportunity for serving the global ecosystem of SMRs. After all, any organized retail game, domestic or international starts with automation. For Indian IT solution providers, SMRs offer great business opportunity. This can be a win-win situation for the inseparable friends!

Enjoy the Reading!!