REad this this may be important for you all

Indian Retail – Stll a big gamble

I am doing MBA as u all know.....maha bekar aadmi Lolzzzzz... but u see as an interseted student  of business i used to think about retail a lot. after a discussion in the class rooms i had made some report basically on the fall of the GIANTssss. i hope u enjoy it.

 

The Indian retail industry has been riding a wave for the last couple of years. According to a latest report, retail sales are expected to rise from US$ 343 billion currently to US$ 543 billion.

Reliance Fresh, Subhiksha, Vishal Retail, Spencer’s, More, Big Bazaar and many more have entered India since the modern format retail concept began. The expanding middle and upper classes has played a big role in the expansion of existing modern format stores and entry of new ones.

The biggest question is “Have all of these stores been successful?”

The answer is a big NO. 

We shall discuss about two of the biggest failures in the history of Indian retail – Subhiksha and Vishal Retail.

Subhiksha was started by R. Subramaniam, an IIM A and IIT Chennai alumnus with its first store at Chennai. Ram Chandra Aggarwal set up his Vishal Garments Store in 1994 – three years before Biyani’s Pantaloon and seven years before setting up Vishal Retail. Both of them are discount stores at prices which are much lower than other retail outlets.

Though, Subhiksha has closed down and Vishal is still in the market, there are some points of similarity in their fall from glory which I would like to mention here –

Un-mindful expansion spree across different parts of the country

Subhiksha didn’t realize that with this only a few stores would be profitable and generate positive cash flows. It moved across different sectors such as medicine, grocery, IT, mobile etc very fast.

Vishal expanded without having the proper capital. They got the orders from the suppliers but when the stores didn’t work out, the entire supply chain got choked.

IPO problem

Subhiksha was thinking of going for an IPO in 2007 but shelved it in view of “uncertain market conditions”. But I believe that they got greedy as they expected a market correction.

Vishal on the other hand raised Rs 110 crore from an IPO in June 2007 which wasn’t enough to meet it scorching growth pattern. It had 50 stores by then and was looking to expand to 130 stores in a year. But it went for short term debt which resulted in a big blow to their entire supply chain when the stores didn’t happen as intended.

Both of them didn’t consolidate

Subhiksha and Vishal instead of stabilizing and consolidating themselves first in different places and then moving to newer locations, tried to be the first in every town.

Poor inventory management

Subhiksha had a bad history of credit defaults and this led to supply breakages. This led to situations where sometimes the store had very high inventory and at others, the stocks were out. This led to great dissatisfaction.

Vishal’s distribution center led model failed as it couldn’t build an IT network. Buying at warehouses was mostly not aligned to what the customers needed and resulted in dead inventory.

Private Labels

Vishal tried to develop private labels in almost every category but had limited scale to support them.

Subhiksha closed down in 2009 amid allegations of defaults, non – wages payments and bankruptcy. The people behind it are still struggling to come up with valid explanations.

Vishal has brought down the rentals of the properties, decreased its expenses and closed down two dozen stores and warehouses and plans to close more. They still need an infusion of about Rs 50 crore. Would the lenders give them?

The bad story still continues bur ma bet is still on MUKESH AMBANI....i hope he does not diasappoints me.....

Best Quotes available.....selcted version....

"Moral indignation is jealousy with a halo."

- H. G. Wells (1866-1946)

"Glory is fleeting, but obscurity is forever."

- Napoleon Bonaparte (1769-1821)

"Victory goes to the player who makes the next-to-last mistake."

- Chessmaster Savielly Grigorievitch Tartakower (1887-1956)

"Don't be so humble - you are not that great."

- Golda Meir (1898-1978) to a visiting diplomat

"His ignorance is encyclopedic"

- Abba Eban (1915-2002)

"If a man does his best, what else is there?"

- General George S. Patton (1885-1945)

"Political correctness is tyranny with manners."

- Charlton Heston (1924-)

"You can avoid reality, but you cannot avoid the consequences of avoiding reality."

- Ayn Rand (1905-1982)

"If you are going through hell, keep going."
- Sir Winston Churchill (1874-1965)

"He who has a 'why' to live, can bear with almost any 'how'."
- Friedrich Nietzsche (1844-1900)

"Many wealthy people are little more than janitors of their possessions."
- Frank Lloyd Wright (1868-1959)

"I'm all in favor of keeping dangerous weapons out of the hands of fools. Let's start with typewriters."
- Frank Lloyd Wright (1868-1959)

"Some cause happiness wherever they go; others, whenever they go."
- Oscar Wilde (1854-1900)

"God is a comedian playing to an audience too afraid to laugh."
- Voltaire (1694-1778)

Political Vagueness

NDTV is my favourite channel but for week in arow it is hooked up with the news of hooglism in Maharashtra and support for SRK. well i support him on one plea that as a peace loving Indian he had said so and also as a Corporate he has been true to us. When the stakes are as high as million of dollars how can he be not ignited if his fav is not included to the fault of these Pakistani extremists.

As i always say i am an interested Political Economic student. One outlandish thing came to my mind - IS THERE ANY SOLUTION FOR KASHMIR ISSUE? well i think thumbs down to the person who says it. India says kashmir is theirs, Pakistan says Kashmir is theirs , Kashmeres in turn are divided and even some demand autonomy too!!! Foreign secy talks are on the anvil. I will be really poignant if this happens.Hats off to Chidambram for his exemplary dedication.He has really worked hard. Sena and MNS just believe in regional chauvinism. They just can be called Internal Terrorists. Pakistani people are not bad till they dont support terror. I criticize them only for selecting wrong people at the helm of the affairs.

USA has a infuriating role to play. It is supporting Pak knowing that it is using aid against India.Obama has truly failed to deliver and it can be said that great speeches never make great admininstrators. f he wants he can stop terror to a large extent as he has did in afghanistan.

There is a case of clear Vested interests in case of Sena politics. People should be made literate about the same and should be told to follow the nature of love and harmony rather rhan holding protests or candle walks. They are going to do nothing great as they have not yielded anything apart from media hype.

As my mentor Mukesh Ambani says "India is not a land of billion problems but of billion oppurtunities" .It is the youngistaans time to be more knowledgable about these scenarios and show maturity.We have two options -

1 To follow the legacy of Gandhi, Nehru and make India a big one.

2 Read this blog and say GOOD WORK and then close it to scrap friends at Orkut.

Choice is yours.

POLITICAL

TREHAN

MANAGEMENT GURU SHIVAM IMS WALE

IMS IS REALLY.........Well what is this????????????? Now dont ask me that whether i am questoning or answering but what is this?????????.Truth apart, i never want to start my 1st blog of 2010 on this title.But can anybody help us in defining IMS.
"IMS is an Institute roopi Galat fehmi jo har koi paal ke yahan aata hai aur Yahan aa ke yahan ka ho jata hai" - Shivam Drucker
Shivam Taylor theory of IMS management -
"IMS is an institute jahan insaan insaan ban ke aata hai, use scientific methods se jugaad kar ke training certificate banvana sikhaya jaata hai, motivation ke taur par pe aapko kuch nahi kaha jaata aur insaan ko Self dependent banake uske targets us par hi chod diye jaate hain"
we have read a lot of subjects right! from management to OB to company law to Our favoruite QT and then on and on and on!!!!! well i think kudos to the persons who had made this ambitious 5 year programme with a great variety of subject and the TRAINING also.........TRAINING ALSO?????? well in this chillying weather dont lie that evn 20% of u are taking training. U see we are very proud students of IMS getting 1st divison in every sem but my dear friends let me asure u that not even 30% of students are having practical exposure which is essentiality of a good carrer prospect. NO MUDSLINGING.........every body to blame including me and you.
PLACEMENT scenario this year has already pulled our hairs.Then we have a hell lot of detractors busy in watching that nothing good happens. well this time i am not telling u to really stand up because cowards like u remain cowards!!!!! There is not a single person who is ready to support the initiator because we "dont worry" attitude will never go and significantly result is in front of u.
Dont feel Cricmania and Taylors cup will change Institute.Academics is the real thing and due importance has to be given to our carrers.so dont feel happy if u are having 3 events in a year bec ultimately without academics ur future is like 'Ram gopal verma ki AAG'.
I really take this forum again to Congratulate Praveen for his heroic workmanship.He really wants to make our training process formal so that everybody benefits out of it. Good work dude, if these all cowards are not with u , I will be standing till death.And haan please mujhe ye blog padhne ke baad galiyan suna dena because now i too "dont worry'
Fantastically and Dramatically Yours
Trehan