Archive for August, 2011


Recently a Committee of Secretaries, headed by Cabinet Secretary Ajit Seth, passed a proposal for FDI in retail. At present, India allows FDI only in single brand retail chains like Nike, Louis Vuitton etc with a cap of 51%. It also permits 100% overseas investment in wholesale cash-and-carry format. The Cabinet note, circulated by the Department of Industrial Policy and Promotion (DIPP), proposes multinational multi-brand retailers like Wal-Mart, Carrefour and Tesco to set up stores in cities with population of over one million (according to 2001 census) which would include 36 cities. The proposal also has a rider that foreign retail giants will have to invest a minimum of $100 million, half of which must go to the back-end infrastructure like cold storage, soil testing labs and seed farming.

This development is critical as retail industry in India has an employment rate of 7% and given its potential, it is stipulated to grow in such a fashion that can alter the fundamentals of the economy for good. The retail industry is divided into organized and unorganized sectors. Organized retailing refers to trading activities undertaken by licensed retailers, that is, those who are registered for sales tax, income tax, etc. These include the corporate-backed hypermarkets and retail chains, and also the privately owned large retail businesses. Unorganized retailing, on the other hand, refers to the traditional formats of low-cost retailing, including the local kirana shops, owner manned general stores, paan/beedi shops, convenience stores, hand cart and pavement vendors, etc.

India’s total retail sector is estimated at $590 billion, of which unorganized accounts for more than 90%. Currently a few big players like Walmart and Carrefour have set up joint ventures in India in the cash and carry format waiting for the FDI norms in multi-brand retail to be opened up. Apart from these foreign names, there is intense competition among Indian players in the retail segment- many of such players are still struggling with their bottom line. Aditya Birla Retail having 554 supermarket stores and nine hypermarkets under the brand name of More is one of the prominent players and is expected to achieve profitability by 2013. Reliance Retail, another big name, with around 1,150 stores achieves $1 billion revenues but is yet to see profitability. Titan, a major retail player in watches segment has 650 stores today and plans to add 300 more in 2011-2012. Future’s group through its Big Bazaar outlet and Shopper’s Stop of Raheja Corp. has been in the eyes of the masses since its establishment in 1997.

While these big players have intense competition among them, they still occupy only a small part of the retail market, the rest being occupied by the unorganized players – the smaller kirana shops and convenience stores. The discussion on opening of FDI in retail sector is being seen as threat to these small players. According to a PwC-CII paper, there are 12 million such Kirana stores. A huge segment of the country’s population makes their livelihood from these kirana stores given the small investment required for setting up a small round the corner store.

 Opening up of retail for foreign giants will also poses a threat to the local industry. It is being feared that these companies will import their products from cheap markets and kill the local industry here. It is also argued that the global retailers will initially reduce prices drastically with a view to oust local competition. Once they have successfully established their operations, they would raise back the prices. A just fear but exaggerated to say the least. The retail industry in India is big enough a market for everyone to get a share of the pie. Also the government will certainly take prudent steps to ensure that development of local markets and supply chain become part of the business plan of these companies which can be seen in the covenants it has included as part of the FDI proposal (investment of a minimum of $100 million, half of which must go to the back-end infrastructure like cold storage, soil testing labs and seed farming).

We also need to think whether the big players would really be a threat to the kirana stores? If yes, to what extent? Kirana stores, as we know them have strong presence in rural and semi-urban tier II and tier III cities. They are preferred highly for their convenience and home delivery services. Long standing relationship of families with kirana stores enable them to open standing credit account facilities with the kirana stores. This is something, which will be very difficult for the big players to adopt. The big stores can never duplicate the convenience and the personal relationship in its entirety. Moreover, unlike in the West, the kirana stores will continue to be a part of the Indian scenario for several years given the shopping styles of consumers (only a fraction would be interested in driving to huge stores to stock up items for the entire week). The culture of shoppers to shop daily coupled with lack of storage space make the kirana store a part of the Indian middle class.

Opening up would do our FDI a lot of good by boosting it, which dipped by 25% to $19.42 billion in 2010-11 from $25.83 billion in the previous fiscal. Apart from this, India has also been fighting with the spiraling inflation, which has been driven by supply side deficiencies. According to estimates 40% of fruits and vegetables are wasted. The solution to all this is to improve the supply chain, cold storages and technology which can be enabled if there are huge investment inflows into these. With a view towards this the government opened up the wholesale business for FDI. Unfortunately, opening of the backend does not resolve the issue, as the companies are not interested in investment unless they can harness huge profits from access to the front end. Also the access to front end due to the co-ordination between frontend and backend put together is the only way that you can deliver lower cost products to the consumer. Better supply chain and technical knowhow would ensure that the transit of produce from farm to shop floors is smooth. With the elimination of middlemen, the prices will also be reduced thereby benefitting the consumer. Contract farming will benefit the farmers. Better prices for their farm produce and timely sale of the perishable goods can help the agriculturists earn more.

Interesting aspect to know here is that the existing retail players in India like Aditya Birla Retail (More) and Future Group (Big Bazaar) are welcoming the FDI proposal. For these multi format retailers, FDI will mean ready availability of equity funds without taking the risk of excess leverage. The funds will help in executing their expansion plans and thereby offer better revenue visibility. Also the foreign partnership would bring it greater expertise in improving efficiencies and setting up backup infrastructure. The threat from foreign players is also reduced by the fact that these players already have store presence in key market locations, something which will be difficult for new players to get and hence the upper-hand. Moreover, with the complexities of Indian markets like complex and high inter-state taxes, high working capital requirement, lack of automated operations etc would require handholding of foreign players for the next 5-10 years which is an opportunity in itself to learn and grow for the Indian players.

Given the dynamics of our country, the policy makers have liberalized the economy and the industry segments in a phased and cautious manner. This is what is needed for the retail industry too. Indian companies need money to grow, the sector needs investments for development and the sector is attractive to players who are ready to invest. What’s needed for a win-win situation is a phased and planned introduction of FDI in the segment. It will take another 10-15 years before multiple brand formats become the trend in the country. The same is the period required for the foreign players to learn the market and set up necessary infrastructure. Yet, the kirana stores would never go out because of the reasons like comfort and convenience. The future will see consumers divide their purchases between kirana stores and modern retail outlets.

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Happiness is just a TAB away !

If you’ve been waiting for a magic wand to make you life easy, you are just in luck ! And if you are a tech-savvy person its treat time ! Samsung recently launched its Samsung Galaxy Tab 10.1. It’s indeed happy times for TAB lovers and right time for those who haven’t used till now to get hooked on to one.

Samsung Galaxy Tab 10.1

So I am not going to bore you with the specifications and the technical details. You can always find them at this awesome website with all the rich information about the Samsung Galaxy Tab. What I wish to entice you about is the cool things about this device and how it makes your life interesting, fun and easy !

Sleeker, Lighter, Faster, Better !!

That’s true ! The new Samsung Galaxy tab promises that and much more. With only 565 gm of a cool gadget in your hand, the sleek 8.6 mm slim Tab offers you the convenience of easy portability and hassle-free on the move usage. The high definition 10.1″ screen means that you can watch all your favorite movies anywhere, anytime ! And yes, you can create beautiful memories of watching love movies with your girlfriend – she will simply love you for being her Aladdin with the magic lamp.

Seamless presentations, conference calls and multitasking – Business in your pocket !

When it comes it business, there is very little room for error and the Samsung Galaxy Tab promises you exactly that. Multiple applications to support your presentation development and the ability to multitask between different applications ensures you can be super productive and efficient. Be anywhere in the world, The Tab allows you to connect with business partners on conference calls for that very important presentation you prepared on Tab last night. The HSPA+ and Wifi Access with a fully supported Flash function ensures glitch-less presentation through a fast and steady 24/7 connectivity.

The ‘Happy Moments’ click

There are some moments in life you always cherish. Be it the celebration of your first job or the first walk of your baby. What better than to capture these moments to be remembered forever. The 3 MP camera delivers high quality pictures just for you to relive those moments whenever you want. The High Definition video recording is an icing on the cake – something to make your day out all the more fun and joyful. And if you ever feel gloomy just say cheese and click yourself away through the front camera – you will most certainly have a smile after that throughout the day !

Games, Music, Multimedia, Social Networking – The Android Entertainment !

Leisure time is in and there is nothing better than a Samsung Galaxy Tab in your hands.  If your idea of relaxing is reading, the inbuilt Reading Hub provides access to numerous reading delights along with enhanced reading comfort through zooming, font enlargement and bookmarking features. To soothe you with Music, the Tab offers extensive catalogue of music albums through its Music Hub. The High Definition movie experience ensures that you enjoy your movie to the fullest extent with your friends. And just in-case you are missing your friends for that favorite movie, the Tab enables you to connect to them through email, instant messaging and social networking from a single point portal. You never remain disconnected ever!

Excited ? Watch this official Samsung Galaxy Tab 10.1 video to believe the power of Samsung Tab

Are you in the mood to try your hands on this sexy, sleek high powered gadget? Then watch this official video to see what you gotta do next.

Oh Yes ! You are right ! It’s time to TAB!

Grab your piece from the nearest Samsung Outlet and spread the word. Happiness increases when spread right ?! 🙂

This post is part of Samsung Mobile Program and Indiblogger. Also do participate in the blogger meet on 10th September 2011 if you can. If you like the post please mark your vote here on Indiblogger.

You can watch the launch video of Samsung Galaxy Tab 10.1 here.

PS: I am a gadget lover and have tried to give a passionate view of the product. Please let me know your views and comments. Also to get a more personalized view of the product, like this blog post and post comments so that I can win the Samsung Galaxy Tab 10.1. 😀

The movie ‘Aarakshan’ starring Amitabh Bachchan, Saif Ali Khan and Deepika Padukone is set to be released tomorrow and it is already banned in UP, Punjab and Andhra Pradesh. A movie which has been certified and passed by censor board to be viewed by public and strangled at the hands of politicians who claim to do it in the name of voice of people who have elected them. This form of political censorship is totally absurd and a outright abuse of the freedom of speech.

Aarakshan does touches the sensitive topic of reservation. It talks about a topic which undoubtedly is the most burning issue of this country and yet it is a subject which has been never actually discussed with an open mind. Not to say that the movie does anything substantial on it, but the director has the full right to create a movie which talks on sensitive topics. Freedom of expression and speech doesn’t stops at sensitive topics. When politicians themselves can use reservation as a topic to fuel their election campaigns in the name of supporting the minority, how can they restrict a movie maker who is trying to make his living from the subject and at the same time throwing light on the issue through the movie. A couple of dialogues are being touted as potential cause for riots and offensive to certain communities – are we really that immature ? Cinema has always been meant for entertainment. Even though it is a reflection of the society and its values, yet its intended purpose has always been entertainment. I am sure no rational person would feel offended and cause to break a riot for a few theatrical dialogues.

Aarakshan banned in 3 states

What amuses one even more is that few leaders/representatives of minority communities are asking film makers if they give roles to backward class people in movies ? So are we now talking about reservation quota in movies? Isn’t asking for reservation for a few communities a way of stark cast-ism in itself? Reservation was initially proposed to be a mean to help the backward classes and the oppressed; it makes one sad to see it has become merely a political agenda and a mean to create uproar for personal and political motives.

What’s needed is a stronger reaction from the film community and a greater sense of responsibility from the political parties by not treating reservation as a toy to play around and painting it on everything they can get their hands on. Let’s respect the censor board and accept their allowance for this movie and let the public decide the worth of the movie. It’s entertainment people, not politics !

PS: Let me know your views and whether you agree with the ban or not? Just to make it clear, my blog is not about supporting or opposing reservation, its about whether the ban is right or not.

PPS: Post your view on how the movie is if you watch it tomorrow. Is the movie really that electric to deserve all the bans ? I will write a review of the movie, once I watch it, in my upcoming blogs.

The views expressed are personal to those of the author.

Image: Courtesy IndianExpress

Samsung Galaxy Tab – The Launch !

Samsung Galaxy Tab 750 Launch

 

Samsung is launching their latest Samsung Galaxy TAB 750 on August 10th 2011 and you have an opportunity to watch the live online streaming by clicking the banner above.  Do click it on 10th August 2011 between 12 PM to 2 PM.

Some of the main features of Samsung Galaxy tab 750 is below

  • Large 10.1-inch High Definition display
  • Latest Google Android Honeycomb OS (v3.1)
  • Powered by a 1GHz dual-core Tegra 2 processor
  • Wi-Fi, Bluetooth, 3G connectivity,
  • Dual Camera – front and Rear (HD)
  • Back : 3 mega-pixel AF camera with LED Flash , HD video recording
  • Front: 2 Mega Pixel Camera