Subhiksha manendra

2,164 views

Published on

Published in: Business, Economy & Finance
0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
2,164
On SlideShare
0
From Embeds
0
Number of Embeds
3
Actions
Shares
0
Downloads
20
Comments
0
Likes
1
Embeds 0
No embeds

No notes for slide

Subhiksha manendra

  1. 1. The Subhiksha Story PRESENTED BY: Manendra Shukla
  2. 2. THE SUBHIKSHA STORY SUBHIKSHA SUBHIKSHA = PROSPEROUS SU + BHIKSHA = BEST WAY TO BEG MONEY SU + BHIKSHA
  3. 3. THE SUBHIKSHA STORY INDIAN RETAIL INDUSTRY Retailing as an activity than an industry The retail sector is the second largest employer after agriculture. Organized retail market will generate jobs for 12 million people Fast growing Indian middle class with more than ever disposable income
  4. 4. THE SUBHIKSHA STORY ORGANIZED SECTOR UNORGANIZED SECTOR 6% 94% ORGANIZED RETAILING IN INDIA
  5. 5. THE SUBHIKSHA STORY Entrance of Subhiksha in market Indian retail icon R. Subramaniam Wanted to be big fish of the pond wanted to be early entrant in the market He selected retailing as a business .
  6. 6. THE SUBHIKSHA STORY
  7. 7. Market Analysis <ul><li>Customers generally looked for: </li></ul><ul><li>Accessibility of the store </li></ul><ul><li>Availability and quality of groceries, </li></ul><ul><li>Price of branded groceries. </li></ul><ul><li>Customers don’t like to travel beyond 5 km for purchasing groceries. </li></ul><ul><li>Customers don’t place any premium on shopping in posh air-conditioner set-ups. </li></ul>THE SUBHIKSHA STORY
  8. 8. THE SUBHIKSHA STORY STRATEGIES FOR THE SUCCESS 1. EDLP STRATEGY OF WAL-MART ( Eliminating Distributors for Lesser Price ) Wholesaler/dealer elimination Bulk purchases directly from manufacturers or stockiest qualified for deep discounts Spot payments against delivery to get cash discounts
  9. 9. THE SUBHIKSHA STORY MANUFACTURER DISTRIBUTOR WAREHOSE STOCKIST RETAILER CUSTOMER SUPPLY PAYMENT SUPPLY SUPPLY PAYMENT PAYMENT PAYMENT SUPPLY PAYMENT SUPPLY MFD. COST PRICE +MFD. PROFIT +stockiest PROFIT +warehouse PROFIT +Distributor PROFIT +RET. PROFIT = MRP = BELOW MRP
  10. 10. <ul><li>Middle class purchasing power was increasing. </li></ul><ul><li>Middle class is having huge number of consumers </li></ul>TARGETED MIDDLE CLASS THE SUBHIKSHA STORY
  11. 11. CUSTOMER LOYALTY <ul><li>Low price is the only carrot </li></ul><ul><li>Lifetime relationship with the customer </li></ul><ul><li>Loyalty cards for regular customers </li></ul>THE SUBHIKSHA STORY
  12. 12. BRANDING <ul><li>Best deals or lowest prices for them </li></ul><ul><li>Trustworthy and Reliable store </li></ul><ul><li>Easily accessible </li></ul>THE SUBHIKSHA STORY
  13. 13. 4 P s of Subhiksha THE SUBHIKSHA STORY <ul><li>Product Mix </li></ul><ul><li>Good quality products </li></ul><ul><li>Best value for the money. </li></ul><ul><li>2. Promotion </li></ul><ul><li>Less money for greater value </li></ul><ul><li>Bachat Mera Adhikar, </li></ul><ul><li>Subhiksha Mera Abhiman </li></ul><ul><li>details of savings on the bills </li></ul><ul><li>3. Place </li></ul><ul><li>Benchmark of 2 KM </li></ul><ul><li>Assured the supply to </li></ul><ul><li>the customers </li></ul><ul><li>4. Pricing </li></ul><ul><li>No-frills stores </li></ul><ul><li>No air-conditioning </li></ul><ul><li>No fancy lightings </li></ul><ul><li>No touch-feel experience </li></ul><ul><li>Shops just of the main roads </li></ul>
  14. 14. THE SUBHIKSHA STORY * Rs in Crores 330 2305 833 financial performance 281 218 Net income growth
  15. 15. THE SUBHIKSHA STORY Operating expenses Net income Debt YEAR 2003 2004 2005 2006 2007 2008 NET INCOME 212 218 281 330 833 2305 OPERATING EXPENSES 203.4 211 275 324 825 2945 DEBT 16 17 21 80 234 750
  16. 16. THE SUBHIKSHA STORY THE TROUBLE BEGINS
  17. 17. THE SUBHIKSHA STORY Nothing succeeds like a success Nothing fails like a failure. Unplanned Expansion???
  18. 18. Unplanned expansion THE SUBHIKSHA STORY Indian Retail Growth Subhiksha Expansion Growth Recession Factor If we are failing to plan, we are planning to fail.
  19. 19. THE SUBHIKSHA STORY IDEAL OK BAD WORST PLAN A PLAN B PLAN C PLAN D PRAGMATIC RISK SCENERIO PLANNING F A I L
  20. 20. THE SUBHIKSHA STORY
  21. 21. THE SUBHIKSHA STORY SUPPLY CHOCKED
  22. 22. THE SUBHIKSHA STORY LACK OF WORKING CAPITAL SUPPLY CHAIN MANAGEMENT H.R.POLICIES OPERATIONAL INEFFICIENCY THE MAJOR ISSUE
  23. 23. THE SUBHIKSHA STORY SUPPLY CHIAN MANAGEMENT LACK OF WORKING CAPITAL UNDERMINING REVENUE CUSTOMER RELATIONSHIP MANAGEMENT STOCK OUT
  24. 24. THE SUBHIKSHA STORY H.R.POLICIES LACK OF WORKING CAPITAL UNDERMINING REVENUE CUSTOMER RELATIONSHIP MANAGEMENT MOTIVATION
  25. 25. THE SUBHIKSHA STORY OPERATION INEFFICIENCY LACK OF WORKING CAPITAL INCREASE IN OPERATIONAL COST UNDERMINING GROSS PROFIT
  26. 26. Taking Eyes of the Ball <ul><li>Less focus on the product mix </li></ul><ul><li>Customers are not fixed to any brand </li></ul><ul><li>You just don’t want to waste your time in a shop which offers you everything and anything but they don’t offer a thing which you want . </li></ul>THE SUBHIKSHA STORY
  27. 27. The Volume Game <ul><li>Increased the density in existing locations </li></ul>THE SUBHIKSHA STORY Subhiksha was competing with Subhiksha VS
  28. 28. Lack of Transparency <ul><li>Failed in disaster management </li></ul><ul><li>Denial mode </li></ul><ul><li>Keep the investors in dark </li></ul><ul><li>Inability to communicate well </li></ul>THE SUBHIKSHA STORY
  29. 29. Other mistakes <ul><li>Misplaced ambition </li></ul><ul><li>Rash aggression </li></ul><ul><li>Undermining the big issues. </li></ul><ul><li>Over enthusiasm. </li></ul><ul><li>Bad management. </li></ul><ul><li>Untrained staff at floor level. </li></ul>THE SUBHIKSHA STORY
  30. 30. External factors <ul><li>1. Global financial tsunami </li></ul><ul><li>IPO nipped in the bud </li></ul><ul><li>No one was ready to finance </li></ul>THE SUBHIKSHA STORY
  31. 31. External factors <ul><li>2. Competition </li></ul><ul><li>To sided competition </li></ul><ul><li>No remarkable changes for the competition </li></ul>THE SUBHIKSHA STORY
  32. 32. Role of ICICI Ventures????? <ul><li>What ICICI was doing? </li></ul><ul><li>Why didn’t they object them? </li></ul><ul><li>Having 24% stake in the company why they allowed to these blunders? </li></ul><ul><li>Escapism of the joint MD of ICICI </li></ul>THE SUBHIKSHA STORY
  33. 33. CURRENT POSITION <ul><li>It is now on ventilator. </li></ul><ul><li>Corporate Debt Restructuring </li></ul><ul><li>New and Renegotiated contracts. </li></ul>THE SUBHIKSHA STORY
  34. 34. SUGGESTIONS <ul><li>Renegotiations with vendor </li></ul><ul><li>Reduce its store </li></ul><ul><li>Trained and Experienced Staff </li></ul><ul><li>Private Label and Cash and Carry Counter. </li></ul><ul><li>Go to the semi-urban areas like tier 3 and tier 4 cities </li></ul>THE SUBHIKSHA STORY
  35. 35. LEARNING FROM THE STORY <ul><li>Fragmented Risk taking </li></ul><ul><li>Managing cash flow is the key . </li></ul><ul><li>Planning is the most important part of any business </li></ul><ul><li>Business models itself can not pay for the costs of running the operation. </li></ul><ul><li>Between being Big and being Remarkable – Choose remarkable. </li></ul>THE SUBHIKSHA STORY
  36. 36. References <ul><li>Business Standard </li></ul><ul><li>Business Today </li></ul><ul><li>www.complaintsboard.com </li></ul><ul><li>www.indianexpress.com </li></ul>

×