Store Design - Customer Convenience Vs. Space Productivity

Time and again I have come across the now cliched customer service motto/philosophy of retailers which is expressed in may different ways

• we put customers first
• customer is king
• you want it , we have it
• we don't just provide goods, we provide the experience

Sets me thinking of the times when.....

• i went to a store for a pair of black trousers and found it at the fag end of the store
• i went for a white blouse and was told "the white regular shirts are in the formals department, the new ruffled blouses are in the casual department, and there were perhaps another 3 places where I could find white blouses.
• i wanted staples like milk and eggs and had to walk around an entire hypermarket to find them near the exit.

Both the above lists are totally oxymoronish. Here we are telling our customers (and ourselves) that we do everything for your convenience and there we go playing games with her trying to ensure that our space gives us maximum returns.

Agreed that there is a trade off between the two. However, rest assured that there is a way of resolving the customer inconveniences beginning from the stage when we are arriving at the retail concept/format.

More importantly, gain clarity on whether as retailers, we are committing to customer delight or not in the first place. We could just be committing to the lowest prices and not much more. We need to come out of the garb of great customer service when it isn't truly a part of the plan or even when we aren't sure of fulfilling the commitment.

However, taking a position of 'best customer service' etc. we need to remember that every thing in the store (right from layouts to checkouts) stand true to our commitment.

Small And Medium Retailers In India

Small and Medium Enterprises in India is a very large and extremely difficult market . To use a cliched phrase, India behaves like many different countries. Also, geographically, you don't know where the customers are, which city and which marketplace. Therefore to support these businesses it is important to create a comprehensive ecosystem around them rather than piecemeal efforts. This obviously takes longer than one would expect, given the infrastructure, lack of education and awareness etc.

From the SMEs' perspective, what they are looking for is a

• a solution that will help address their business needs
• a solution that can be easily implemented, and
• a solution that is cost effective in the short and the long term.

By an estimate by AMI Partners Inc., there are 2.7 million small businesses in India (less than 99 people) which do not have a single computer and a major proportion of them belong to the wholesale and retail sector. Also, India has the largest no. of retail stores in the world, Highest shop density (11 outlets for every 1000 people) . With close to 12 million retail outlets the country has one of the highest retail densities worldwide.However, the per capita retail space is one of the lowest in India, which is a ramification of the small sizes of the stores. Which again reflects on the largely unorganised retail industry in India.

Impressions about the Small and Medium retail being largely unorganised are authentic, however , by the same logic all large retailers may not be organised. Paying/Not paying of all applicable taxes being the conceptual distinction between organised and unorganised retail, retailers are increasingly moving to the terminology of 'modern retail' vis-a-vis 'traditional retail'. (which was mostly the meaning anyway even earlier when 'organised' and 'unorganised" terms were used)

All these traditional retailers fall in the purview of Micro and Small Businesses,. Needless to say, the challenges for this sector are only magnifying by the day.

Besides all the vocalised needs , what might make a difference to these businesses is mentoring in a structured manner. Evaluating the areas of mentoring ......i will leave for the next post. Watch this space...........

Our Workshop at The India Retail Forum 2007

I and Rajeev anchored the "Mentoring SMEs in Retail" at the India Retail Forum 2007. While we had detailed preparation, it was still exciting to find that people responded so well to our workshop. The response was tremendous - by the end of the workshop there was no place to stand , leave alone sit. We talked about the imperatives for a Small/Medium Sized Retailer, especially knowing and monitoring the basic metrics, keeping your eye on the cash flow, focusing on providing the Right product at the Right time and the Right Price to the identified target segment.

Simple as it may sound, at the retail practice at Milagrow we come across many such small retailers who are struggling with cash flow challenges for instance. It is of paramount importance for them to know this well and make the right investments at the start up stage. To build organisations ready for scale, we have to keep our eye on the customer and the product while building capabilty inside!