Modern Trade

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At Food Bazaar, the food retail supermarket of Indian retail major in India, Pantaloon retail, a new revolution is unfolding. Indian consumers in huge shopping malls with carts overflowing with goods match upto the their counterparts in any part of the developed world. The rise of modern trade, which for now accounts for only 3-4 % ofn the total trade in India, but is estimated to clip a fast growth rate of 30 % per annum has thrown many a opportunities and challenges. Retailers such as Food Bazaar from Pantaloon, Food World from RPG group and Subhiksha stores in Chennai have found themselves in a position of strength vis-a-vis the manufacturers. It is a marked departure from the time when manufacturers called the shots in the entire bargain. “Now with a dedicated shelf space which ensures a captive audience in terms of the foofalls, modern trade is slowly emerging as a new viable channels for the manufacturers,” says Damodar Mall, head of Food Bazaar. Now the relationship between the organised retailer and the fmcg companies is that of engagement rather than superiority. So if Nestle wants shelfspace for Maggi, a ready to eat two minute noodle brand in India in any of the major retail formats, it knows that engagement means sitting with the retailer and chalking out a focussed marketing strategy within the outlets. So specific promotions and discount schemes specific to few retail outlets or restricted to one geographical area are being undertaken by the manufacturers at modern formats. Infact many a fmcg companies are initiated dialogue with retailers for category management, where a brand by virtue of being the largest selling brand on the shelf takes the responsibility of managing the category. Under the initiative, the category leader and the retailer enter into an agreement to manage a particular category. The manufacturer then undertakes activities to promote the category and carry out various activities like shoppers analysis, customer research,...
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