This document discusses rural retailing in India and the opportunities it presents. It notes that while urban markets were initially the focus, they became saturated forcing companies to look to rural markets. Rural markets account for 70% of India's population and present significant potential for growth. Characteristics of rural markets include increasing incomes, literacy rates, and family sizes. This has led to rising consumption, especially of factory produced goods, in rural areas presenting lucrative opportunities for retailers.
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Agribusinesses are important to India for multiple reasons-------- such as their contribution to the economy, the number of people they employ, strategic reasons of food security and providing raw material to other industries.
Enterprising the Farmer Entrepreneur (A case study of Manipur, India)inventionjournals
International Journal of Humanities and Social Science Invention (IJHSSI) is an international journal intended for professionals and researchers in all fields of Humanities and Social Science. IJHSSI publishes research articles and reviews within the whole field Humanities and Social Science, new teaching methods, assessment, validation and the impact of new technologies and it will continue to provide information on the latest trends and developments in this ever-expanding subject. The publications of papers are selected through double peer reviewed to ensure originality, relevance, and readability. The articles published in our journal can be accessed online.
Agribusinesses are important to India for multiple reasons-------- such as their contribution to the economy, the number of people they employ, strategic reasons of food security and providing raw material to other industries.
Enterprising the Farmer Entrepreneur (A case study of Manipur, India)inventionjournals
International Journal of Humanities and Social Science Invention (IJHSSI) is an international journal intended for professionals and researchers in all fields of Humanities and Social Science. IJHSSI publishes research articles and reviews within the whole field Humanities and Social Science, new teaching methods, assessment, validation and the impact of new technologies and it will continue to provide information on the latest trends and developments in this ever-expanding subject. The publications of papers are selected through double peer reviewed to ensure originality, relevance, and readability. The articles published in our journal can be accessed online.
Few Statistics about Rural India:
1. 46% of the soft drinks sales happen in rural areas.
2. Rural India accounts for 49% of motorcycle sales.
3. Rural India accounts for 59% of Cigarettes sales.
4. 53% of FMCG sales happen at Rural India.
5. Talcum powder is used by more than 25% of rural India.
6. Lipsticks are used by more than 11% of the rural women and less than 22% of the urban women.
7. ~ 10% of Maruti Suzuki’s sales come from the rural market.
8. More than 90 percent of rural households in Chhattisgarh, Jharkhand, Orissa and Madhya Pradesh did not have access to toilets within their premises
9. Connectivity –In 2006: 13% in rural India had to travel > 30minutes; 2008: just 2%!
10. When it comes to connectivity, Rural Indian BOP segment has grown more than urban in last year
11. Nearly 50% of the villages in the country do not have all weather roads, making physical communication to these villages highly expensive.
A survey by India's premier economic research entity, (NCAER) indicates that rise in rural incomes is keeping pace with the rise in urban incomes. Rural middle class is growing at 12%, close to the urban middle class which is growing at 13%.
In 20 years, rural Indian Market will be larger than the total consumer markets in countries such as South Korea or Canada today, & almost 4 times the size of today’s urban Indian market.
The marketers who understand the rural consumer and fine tune their strategy are sure to reap benefits in the coming years. In fact, the leadership in any product or service is linked to leadership in the rural India except for few lifestyle-based products, which depend on urban India mainly.
742 million Indians constituting 138 million households reside in 6, 38,365 villages (Census, 2001). the size of rural market itself speaks of its potential.The current marketing environment and economic scenario have brought the corporate under contemporary roofs of modern India, which is challenging the current standards of segmenting, targeting and reaching the customers. Realistically, India as a nation has come a long way from the place where only urban population which constitutes 20 per cent of customer base for companies are responsible for 80 per cent of their profits. Also rural markets have acquired significance, as the overall growth of economy has resulted into substantial increase in the purchasing power of the rural communities. A survey by India's premier economic research entity, National Council for Applied Economic Research (NCAER) indicates that rise in rural incomes is keeping pace with the rise in urban incomes.
Opportunities and challenges in indian rural marketSAMEER LAKHANI
To study the current scenario of Rural Market in India
To study the scope, need & features of Rural Market in India
To study the reasons why Rural Markets are becoming important destination for Marketing companies
To study the reasons for greater business confidence in Rural India
To study the innovative practices adopted in Rural Market
To study the major Challenges faced by Marketers in Rural Market
To identify major opportunities available in Rural Market
To find the strategies for improving business in Rural India
Rural India is characterized by low per capita income, low productivity, low literacy and low rate of industrialization along with absence of basic amenities. The unprivileged class is set back by a lack of educational opportunities that could empower them to confidently pursue economic progress and overcome the debilitating effects of low literacy and rigid social hierarchies. India’s rural markets are growing at double the rate of urban markets. The retail revolution is going to act as a catalyst. So, the new concept that is hitting the market today is the "Rural Retailing".
Indian rural market- Gold under the beneath of IndiaMohammed Mohsin
This article is written by me with the help of some reference about Indian rural market scenario which is untapped for the years after venturing big FMCG companies in rural areas they got to know the potential of Rural market in India as half of population is residing in Rural area only. I had talked about my Grandfather how he came from Mumbai to Open a Organised Store in Village of U.P and Tapped the potential.
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"𝐄𝐯𝐞𝐫𝐲 𝐞𝐯𝐞𝐧𝐭 𝐢𝐬 𝐚 𝐬𝐭𝐨𝐫𝐲, 𝐚 𝐬𝐩𝐞𝐜𝐢𝐚𝐥 𝐣𝐨𝐮𝐫𝐧𝐞𝐲. 𝐖𝐞 𝐚𝐥𝐰𝐚𝐲𝐬 𝐛𝐞𝐥𝐢𝐞𝐯𝐞 𝐭𝐡𝐚𝐭 𝐬𝐡𝐨𝐫𝐭𝐥𝐲 𝐲𝐨𝐮 𝐰𝐢𝐥𝐥 𝐛𝐞 𝐚 𝐩𝐚𝐫𝐭 𝐨𝐟 𝐨𝐮𝐫 𝐬𝐭𝐨𝐫𝐢𝐞𝐬."
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Registered Office Clause: It specifies the location where the company's registered office is situated. This office is where all official communications and notices are sent.
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Capital Clause: This clause specifies the authorized capital of the company, i.e., the maximum amount of share capital the company is authorized to issue. It also mentions the division of this capital into shares and their respective nominal value.
Association Clause: It simply states that the subscribers wish to form a company and agree to become members of it, in accordance with the terms of the MOA.
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Binding Authority: The company and its members are bound by the provisions of the MOA. Any action taken beyond its scope may be considered ultra vires (beyond the powers) of the company and therefore void.
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Marvin neemt je in deze presentatie mee in de voordelen van non-endemic advertising op retail media netwerken. Hij brengt ook de uitdagingen in beeld die de markt op dit moment heeft op het gebied van retail media voor niet-leveranciers.
Retail media wordt gezien als het nieuwe advertising-medium en ook mediabureaus richten massaal retail media-afdelingen op. Merken die niet in de betreffende winkel liggen staan ook nog niet in de rij om op de retail media netwerken te adverteren. Marvin belicht de uitdagingen die er zijn om echt aansluiting te vinden op die markt van non-endemic advertising.
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Rural Retail (Research Paper)
1. Rural Retailing in India-The Road Ahead
Shikhar Das Srivastava*
ABSTRACT
The decision to liberalize the Indian Economy in 1991 had far reaching consequences,
which is still continued into the new millennium also. On the marketing front, there was
the arrival of many well-known Multi National Companies especially FMCG product
dealers. In the initial years the focus was on the easily accessible well developed urban
markets but soon it got saturated because of proliferation of brands and intense
competition, resulting in the near saturation of the urban market. This forced companies
to look for greener pastures, i.e. new markets.
All eyes turned to the world’s most promising potential markets of 742 million rural
consumers who had yet to taste the fruits of modernity, a promise that seemed ready to be
fulfilled because of explosion in buying capacity in rural sector.
Rural markets are proving to be vital for growth of most companies. Priority to develop
the rural markets and sincere efforts to overcome the difficulties would open the
floodgates, offering tremendous potential for growth. This paper will reveal such major
opportunities existing in rural sector for many major retail players and how they are
cashing the present and future gains out of that.
*Assistant Professor, Babu Banarsi Das University, Lucknow
1
2. Rural Retailing in India-The Road Ahead
Shikhar Das Srivastava*
1. Introduction: Even after independence, Indian economy is still being dominated by
agriculture sector and the major reasons behind this- (i) its contribution in food grain
production which is consumed by both rural and urban market and (ii) self-employment.
Considering this fact, Central Govt. and other State Govt. have been emphasizing
developments of rural areas through investments in different sections like infrastructure,
agricultural technology and farm productivity. In addition to this private investors also
considering rural as Creamy sector and dominantly supposing as processing and
consumption centers. The demand for production and consumption of goods in rural
areas has increased substantially (two-third of country’s consumers live in rural areas)
both for household and industrial goods i.e. farm equipment and machinery, high yield
varieties of seeds, fertilizers, pesticides, detergent, personal care product, television etc.
Another picture of rural economy is the percentage increased in output namely food
grains, fruits and vegetables, milk, poultry products, handloom and handicraft products
that almost generate half of the India’s National Income. All these elements are raising
the opportunity of retailing in rural.
2. Description of rural market
2.2-What is Rural Area or Market?
There could be numerous approaches and methods in defining Rural Area/Market. All
villages with a population of less than say 4000 or 5000 (or a population of 5000 plus
* Assistant Professor, Babu Banarsi Das University, Lucknow
2
3. a population density over 400 per sq. meter with at least 75% of the male workforce
engaged in non-farming activities) will be considered as rural area. Later on a new and
pure definition of rural area came up as- an area/s having population of less than 5000,
75% of the population engaged in agriculture, 50% of the national income is generated
by the rural population and 2/3rd of the country’s consumer lives in rural territory can
be considered a rural area.
2.3- Retail prospects in Rural India:
Rural India accounts for roughly 70% of the population where 6, 38,000 villages and 593
districts consist of 742 million people. 15% of rural population lives in 20,000 large “non
urban” areas with population more than 5,000 people. 63% of rural population lives in
villages of 1000 to 5000 people. Remaining 3, 90,000 villages have fewer than 1000
people accounting for 22% of the population. Growth in agriculture has resulted in the
rapid rise of rural incomes which results in the rise of consumption pattern especially for
factory produced goods in rural areas. The Indian rural market with its vast size and
demand base offers great potential to marketers. So for the retailers it is required to see in
which segment they are catering in the above division of villages. For example HUL’s
project “Shakti’ caters to villages with a population of 500 or above where in Eveready
considers even the remotest of village as its target customer. It operates through more
than thousand company-owned vans and has over 4,000 distributors to directly providing
service to 6, 00,000 retail outlets. According to the IMD report 1998 of NCAER
(National Council of Applied Economic Research), the consuming class households
(annual income between Rs.45, 001-2, 15,000) in rural India equal the number in urban
India. It is well known that for the same level of income, the purchasing power in rural
areas is much higher as the expenditure on basic necessities is relatively much lesser/
subsidized or free in comparison to the urban India. Thus rural markets are immensely
attractive for most companies. The best example is Hindustan Unilever Ltd. a largest
FMCG company, more than half of its sale of Rs.11, 700 cr. deriving from rural market.
Moreover the following figures shows the lucrative picture of rural sector- Estimated
annual size of rural market in FMCG is of Rs.65000 cr., FMCD is Rs. 5000 cr., Agro-
inputs is Rs.45,000 cr., Two and four wheeler is of Rs.8000 cr. The rural market for
FMCG product enhanced by 30 % between 1992-93 and 1998-99 and accounted for
3
4. about 53% of this product category’s total consumption in India. Similarly in 2001-02
LIC gathered 55 % of its business from rural sector only and for BSNL, half of its
customer base belongs to rural India. Thus market indicators such as size and growth for
many products are very much fascinating for any company to ignore.
2.3a-Characteristics of Rural Market: A rural area exhibits several distinctive
characteristics that are different from urban areas. Demographic features like income
level, literacy levels, family size, occupational patterns, social custom norms and many
other are unique to rural India.
Demographic changes incurring in India:
(i) INCOME Level -The increment in household incomes made a drastic change in rural
retail image. With the increased working population, the purchasing power of the rural
population has gone up from 40% in 1991to 42 % in 2001. The following diagram
depicts the population of Rural India divided on the basis of household incomes. Strivers
and seekers constitute the middle class. The diagram depicts how the increase in
household income will lead to increased consumption by various levels of consumers in
the stated diagram. The diagram shows the growth trend in household income since 1985
to upcoming 2025.
4
5. By the graph, in 2005 the number of Aspires were 253 million (approx) which will in
next 10 year turned into 411.2 million i.e. roughly 158 million people more will be added
to the aspirers class. At the same time, in 2005 the population falling in deprived class
was around 513.5 million, which is expected to decline at the number of 402.5 million
(i.e. 111 million will shift from below poverty line to aspire class).
Similarly in connection to the context the next graph clearly shows the consumption level
change with the growth in disposable income of rural household. It is presumed that the
rural per-household consumption will rise and match the today’s urban level by 2017.
The fact is that the urban consumers have to incur a high cost of living while the rural
population has a higher level of disposable income for the same levels of income. For
marketers, this is an encouraging fact. In 1983 the per-capita consumption expenditure of
the rural areas was Rs.112 /month whereas it was Rs.166 in the urban areas. In 2001, the
per-capita monthly income expenditure increases to Rs.486 in rural areas and to Rs.855
in urban areas. Moreover there is a shift in the expenditure pattern of rural consumers. In
1983, about 66% of the per capita consumption expenditure was on food and, by 2001,
5
6. this proportion declined to 59%. These trends indicate that while income as well as
expenditure in rural areas has increased, their spending on non-food items has also
increased.
(ii) LITERACY Level- Still major population in rural is reluctant towards education.
Primary level education in the rural sector is below 60%. Thus the demand for products
likes books, magazines, notebooks, pens/pencils, drawing instruments, calculators,
computers etc. is low. But changes are taking place due to efforts of Govt. and corporate
people both .The govt. and corporate sector (in form of CSR) is coming together for
promotion of literacy in the rural sector and effect has been shown in form of risen
percentage up to 23%. This is result contributed significantly to an improvement in the
socio-economic status of the rural people. With this growth the demand for educational
products has increased positively.
(iii) FAMILY Size- Families in rural market are joint-ones. In which a group of people
lived under one roof, ate food from common chullah, held income and property in
common and were related to each other by bonds of kinship. Till now they live in joint
families. They check with the family and discuss everything before buying any product.
It is important to consider the size of the family, depending upon this they can go for the
product. The family member’s discussion influences the purchasing decision. Here
money plays the secondary role their composite decision matters a lot. But with rise in
population and resulting pressure on land and several other socio-economic factors, joint
families are breaking apart. A new concept of ‘individualized joint families’ is emerging,
in which families stay in the same house but spend separately. Thus with the increasing
numbers of ‘individualized joint’ and nuclear families, the range and number of branded
products coming into the family can increase.
(iv) OCCUPATIONAL Pattern- The shift can easily be seen from cultivator to wage
earner from last few decades in rural areas. Rural people are also moving towards jobs
and retailing professions. But there is a difference in wage and salary earner
consumption/investment pattern. A daily wage earner has to account for variation s in
income, whereas a salary earner brings home an assured fixed amount and therefore can
plan in a better way. 3/4th of rural household heads are either cultivators or wage earners,
whereas 3/4th of urban household heads are salary earners, petty shopkeepers and wage
6
7. earners. The cultivator’s disposable income is highly seasonal with more disposable
income available immediately after the harvesting season. This is therefore the time when
he is more inclined to make purchases, especially of consumables and durables.
(v) SOCIAL CUSTOM Norms- Social norms and customs play a significant role in
determining individual and collective behavior in rural India. Village elders and
individuals such as the titular head of the village, caste leaders, priests and such socially
important people have a major influence on the rural people. They frequently influence
the purchase decisions of others in the village, acting as credible sources of information
or playing the role of opinion leader. Similarly there are some social norms and festivals
on which certain kind of products demands shoots-up instantly. Thus Companies must
have to see the rural market as potential market and must develop significant market
strategies for its growth and development.
2.4-Highlights of Rural Retail
Indian urban consumers have experienced the taste of organized retailing which in fact
enlarged the picture of Retail and Consumer stature mainly in rural area. But at the same
time, Marketers are also aware of the fact that urban market would face the stage of
saturation later or sooner and that’s the reason they are armoring themselves by owning
the strategies of diversification and exploring new markets for growth. The major portion
of rural market at the moment is still untouched and especially in retail sector, the
companies like HUL and ITC are leading in rural area and catering the rural demand but
yet there is much more opportunity exists for the other players also.
When organized retail first made its presence felt in rural India, it wasn’t a pure retailing
operation targeting the rural masses. Companies like DCM Sriram Consolidated Ltd.
(DSCL) and Godrej who had significant agri-business interests, set them up to meet the
needs of farmers in a store’s catchments area. These stores are one-stop shops meant to
meet the occupational needs of farmers by providing agri-inputs and fertilizers. These
stores tend to target farmers with all sizes of holdings. While organized retail centered on
these stores, unorganized retail revolves around the local village shop and the haat.
7
8. There are some major players in rural retailing to cater the need of Rural Population. They
are;
(i) DSCL - Hariyali Kisan Bazar
(ii) Godrej- Aadhaar
(iii) HUL Project - Shakti
(iv) ITC - e-choupal and Chaupal Sagar
(v) Kisan Seva Kendra
1. DSCL-Hariyali Kisaan Bazaar
DSCL backed by years of experience in the agri-business, has implemented a
one of a kind rural retailing initiative, the Hariyali Kisaan Bazaar rural departmental
stores, to provide single-point solution to the diverse needs of the contemporary Indian
farmer. Each store covers an area of 3-4 acres and is managed by a team of 7-8 people
whom the Company trains continuously. The total number of Hariyali outlets stood at
302 outlets till 2011. Hariyali Kisaan Bazaar offers the rural household all farming and
consumer products and related services along with financial services under one roof.
These include wide choice and multi-brands of agri-inputs, FMCG, consumer durables,
apparels, footwear, toys, general merchandise, insurance etc. The outlets also
provide the farmer, the expert advice of agronomists and the technological
support in shifting from subsistence farming to technology led commercial
farming. The company also launched credit services during its second quarter 2007-08, in
association with HDFC bank, providing loans for various purposes.
The company also stepped up its bulk procurement activity and trading activity
under review to include various grains (maize, wheat), pulses (chana), oilseeds
(mustard), menthe oil, coriander etc.
2. Godrej- Aadhaar
Godrej Aadhaar is the agri services cum retail initiative of Godrej Agrovet Ltd. It is a
complete solution provider for the Indian farmers and provides professional guidance
with an objective to improve productivity, higher returns and improved cost benefit ratio.
The services offered are crop advisory services, soil & water testing services; buy back of
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9. output, crop finance, supply of agri inputs and animal feeds, transfer of information
(weather, price, and demand supply), door delivery of products etc. While, the venture
begun by offering agri solutions to the farmers, based on their feedback, it has over the
last few months diversified into offering a number of other product categories like –
durables, FMCG, apparels, footwear etc, thus catering to the complete requirement of the
rural household. A one-stop shop for Rural India. A number of corporates are already in
the process of partnering Aadhaar for various projects for furthering the initiative.
Presently there are 70s Aadhaar Centers across the country in the States of
Maharashtra (Mancher, Alephata, Ranjini, Umbraj, Ozar Sangli, Dindori, Niphad,
Shikrapur, Ottur, Akluj). GAVL also opened its second petro format Aadhaar Express in
Kashti, Maharashtra. GAVL revamped its Warden Road “Nature’s Basket” outlet by
positioning it as “Authentic World Food”. This store has introduced new product
categories like wine, cheese, cold cuts, processed foods in addition to its existing
portfolio of fresh fruits, vegetables & herbs and specialty foods.
3. Project Shakti
HUL launched Project Shakti in the year 2001, in keeping with the purpose of
integrating business interests with national interests The model was piloted in Nalgonda
district of Andhra Pradesh in 50 villages in the year 2000. The Government of Andhra
Pradesh took the pioneering step of supporting the initiative by enabling linkages with the
network of DWACRA Groups of rural women set up for their development and self-
employment. Most SHG women view Project Shakti as a powerful business proposition
and are keen participants in it. It has since been extended to in Andhra Pradesh, Bihar,
Chattisgarh, Gujarat, Haryana, Jharkhand, Karnataka, Madhya Pradesh, Maharashtra,
Orissa, Punjab,Rajasthan, Tamilnadu, Uttar Pradesh and West Bengal with the total
strength of over 39,880 Shakti Entrepreneurs. Under the project, HUL offers a range of
mass-market products to the SHGs, which are relevant to rural customers. HUL is
investing significantly in resources that work with the women on the field and provide
them with on-the-job training and support. This is a key factor in ensuring the
stabilization of their fledgling businesses. HUL imparts the necessary training to these
groups on the basics of enterprise management, which the women need to manage their
enterprises. For the SHG women, this translates into a much-needed, sustainable income
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10. contributing towards better living and prosperity. Armed with micro-credit, women from
SHGs become direct-to-home distributors in rural markets. A typical Shakti entrepreneur
conducts a steady business which gives her an income in excess of Rs.1,000 per month
on a sustainable basis. As most of these women live below the poverty line, and hail from
extremely small villages (with populations of less than 2000), this earning is very
significant, and almost twice the amount of their previous household income. For most of
these families, Project Shakti is enabling families to live with dignity, with real freedom.
In addition to money, there is a marked change in the woman's status within the
household, with a much greater say in decision-making. This results in better health and
hygiene, education of the children, especially the girl child, and an overall betterment in
living standards. The most powerful aspect about this model is that it creates a win-win
partnership between HUL and the consumers, some of whom will depend on the
organization for their livelihood, and builds a self-sustaining cycle of growth for all. HUL
envisions the creation of 1,00,000 Shakti Entrepreneurs covering 5,00,000 villages, and
touching the lives of 600 million rural people.
‘i-Shakti’ - an IT-based rural information service has been developed to provide
information and services to meet rural needs in agriculture, education, vocational
training, health and hygiene. ‘i-Shakti’ has been set up in 400 villages in Andhra Pradesh,
and have been functional since August 2003. Through i-Shakti kiosks, ICICI Bank and
HUL will work together to provide a new delivery channel for rural India, which offers a
multitude of products and services to the rural customer. In the first phase, Life and
General Insurance will be offered through this channel. Other financial services including
Investment products (Equity, Mutual Funds, Bonds) ICICI Bank Pure Gold (gold coins),
Personal Credit, Rural Savings Accounts and Remittances will be introduced
subsequently.
4. ITC- e-Choupal and Choupal Sagar
ITC’s e-Choupal is an example of how a commercial venture can provide a
channel for knowledge and opportunity, bringing global resources and practices
to Indian villages as well as higher incomes for farmers, and helping create the
conditions for many other enterprises to cater to the rural market. E-Choupal is an
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11. entirely new channel for procuring the purchase of the farmers. Today they operate
through 6,500 choupals in 9 states. In e-Chaupal they started with two channels known as
Sanchalak and Sanyojak. Sanchalak: Sanchalak is the person in whose house the ITC sets
up the e-Choupal. E-Choupal consists of a computer; linked to the Internet via phone
lines or, increasingly, by a VSAT connection. Each Sanchalak serves an average of
600 farmers in 10 surrounding villages within about a 5 kilometers radius.
Samyojak: Samyojak is the cooperating commission agents. They look for the logistical
support and are responsible for cash disbursement to the local farms for their
produce.They basically facilitate the purchase of the products for ITC fromfarmers. They
take care of 40 Choupals and the average distance a farmer has to travel to reach
Samyojak to sell his produce is 25-35 kilometers.
Chaupal Sagar: Following the runaway success of its e-Choupals, the tobacco-to-hotels-
to-foods major ITC’s rural foray, which kick-started a silent revolution amongst the
harried soya farmers of MP in June 2000, the company has now moved on to the second
phase. And the result is Choupal Sagar, the first of which was unveiled at Sehore
near Bhopal in August 2004. A rural hypermarket or a rural mall, Choupal Sagar
provides multiple services under one roof, like selling produces and buying
quality products for farm and household consumption. Chaupal Sagar are built near
Samyojak, so that when farmers come to sell their produce to samyojak and receive cash
money then they can shop in Chaupal Sagars. Till now there are 19 Choupal Sagars. All
of these stores are located in the rural areas of Madhya Pradesh, Uttar Pradesh and
Maharashtra.
5.Kisan Seva Kendra
Kisan Seva Kendra is a low cost business model by Indian Oil corporation of a
retail outlet offering fuel and other non fuel value added services with penetration
in rural markets generating high returns. KSK a one stop center of service (seva) for the
farmers at his doorstep making available:
Diesel and Petrol with Q&Q
Seeds, pesticides,fertilisers and other agri needs
Nutan stove, Hurricane lamps
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12. Daily needs such as grocery, personal care
Stationery for children
Tools, auto spares
Location specific value additions
Low investment ranging from Rs 6 to 9 lacs with a pay back period of 3 to 4years.It
currently has approx. 100 operational stores.
2.5- More to Come:
Another step to tap the rural market was `Operation Bharat' wherein low-priced sample
packets of toothpastes, fairness creams, Clinic Plus shampoos and Ponds face creams to
20mn households. As a part of their rural strategy, BPCL introduced Rural Marketing
Vehicles (RMVs) that move from village and village and filling cylinders on the spot for
rural consumers keeping in mind the low-income of the rural population. The Company
also introduced a smaller size cylinder to reduce both the initial deposit cost as well as the
recurring refill cost. As clear from the story on Reliance Fresh and Metro, organized
retail sector can bring a revolutionary change in rural India unless it goes for quick short-
term gains. With Wal-Mart famous for its 'Always Low Prices' came in India with
Bharati as equal partner, Indian farmers and rural craftsmen can hope for a better direct
deal. Retailing does not benefit just the consumer. It can give huge benefits to other
industries, to government, and to the entire economy. The rural market is no longer a
non-player in the retail game. It is now accounting for over one-third of the market for
most durable and non-durable products. Even manufacturers are developing new products
with the rural consumer in mind besides using village-oriented marketing strategies for
brand promotions. Whether it is Rani Mukherjee promoting the chocolate Munch or
master batsmen Sachin wowing village lads with a soft drink, both ad makers as well as
top company honchos know where to put their money and how. The rural market is no
longer of hypothetical empirical value but is well researched and reached by most
companies looking to tap India's vast and abundant bounty.
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13. Conclusion
The Indian retail scenario is poised for a quantum leap. Not only are newer names set to
dot the retail landscape but also new and emerging retail formats (especially in rural
sector retailing) will drive the diversity of the fast-changing retail backdrop. Organized
Retail means 'Big Stores' a common myth…nothing can be further then the truth. In its
very essence, organized retailing is about "aggregating value" and what shape, size and
configuration your customer facing entity takes is largely a function of your offer and
proposition. A growing population, a young workforce and zooming consumer
confidence will fuel the expansion of the retail sector. As organized retail in rural India
awaits the arrival of Reliance Retail, current majors like ITC, Godrej and DSCL are
expanding their retail operations by setting up more stores, entering new states and
offering newer product categories. A shift from selling agri-inputs will help these stores
target the non-farming segments. It is a little known fact that, while 25% of the rural
population is not engaged in agriculture, it earns 50% of the rural income. The retail
market is the next growth frontier for corporate India. It offers an opportunity for a large
player to build a Rs. 40,000 Cr retail business spanning multiple categories by 2015 (at
current prices). However, to capitalize on the opportunity, a player needs to be aggressive
in its outlook and build scale quickly.
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5. Consumption of some important commodities in India, (1999-2000,) NSSO, 2001
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markets” Productivity, Vol 39, No 2 July- September, 1998
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Publishing Corporations, New Delhi 1981
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