Subhiksha was a discount department store retail chain founded in 1997 that grew rapidly to over 1000 stores before shutting down in 2007 due to financial troubles. Key factors in its failure included an unmindful expansion spree, poor inventory management, lack of focus, and issues with vendor management. Suggestions to potentially avoid failure included measured expansion, improving employee approach and ethics, better utilizing potential IPO benefits, attractive merchandising, thoughtful inventory practices, reasonable profit margins, consolidated product expansion, audit teams, promotion strategies, vendor management, and focusing on cash flows and ground-level management quality.

1. Professional Practices
Failure of Subhiksha

2. Objectives
To analyse Subhiksha as a failed venture
To list down the factors that led to its
failure
To give suggestions that would lead the
failed venture to a sustainable position

3. Failed Venture

4. Subhiksha : Company Profile
Type • Discount department store
Industry • Retail
Founder • R Subramaniam (IIM Ahmedabad)
Date of Commencement • March, 1997
First store • Thiruvanmiyur, Chennai, India (1997)
Number of Stores • 1000 stores(defunt)
Employees • 25,000(NA)
Website • www.subhiksha.in(defunct)
Date of Shutdown • 2007

5. Subhiksha : About the Company
Subhiksha means "One that gives all good things in Life".
Chennai based supermarket and pharmacy retail chain
USP: Discount Strategies
Market Focus: Middle class income consumers
Company Logo

6. Subhiksha : Product Portfolio
Super
market
Fruits and
Telecom Products
Vegetable
Pharmacy

7. Subhiksha : Growth Portfolio
• Entered Indian • Opened First • 10 Stores in • 50 stores in
Retail Market Store in Chennai Chennai Chennai. ICICI
joins venture.
March March
1997 June 2000
1997 1998
• 120-130 stores • Retail Stores in • Subhiksha
in Tamil Nadu Gujrat, Mobile Shops
Karnataka, Delhi,
Mumbai, Andhra
Pradesh
2002 2004-05 2006

8. Subhiksha : Crash Timeline
October December
April 2008 April 2008
2007 2007
Plans foray Plans Private
Mulls Rs Shelves the
into East Wholesale
350crore IPO Plan
market Marker
September October January
June 2008
2009 Hints at large 2009 2009
Problems in cash
Wants Funds for format consumer
flow, Supplies cut Bankruptcy Filed
Expansion durables and IT
off, Stores go dry
stores

9. Subhiksha : Failure Factors
Un-mindful expansion spree
IPO problem
Poor inventory management
Lack of Focus
Vendor Management

10. Subhiksha : Failure Factors
Balance Sheets: Cash Flows
Quality of ground level management
Discounts as USP
Mastering the supply chain

11. Subhiksha : Suggestions
Measured Expansion
Employees Approach
Promoting Ethics
IPO Benefits
Attractive Visual Merchandising
Thoughtful Inventory Management

12. Subhiksha : Suggestions
Reasonable Profit Margins
Consolidated Expansion of Product Variety
Audit and Survey Teams
Promotion Strategies
Above the Line Promotion
Vendor Management

13. Thank You