Innovations in the Retail Sector of India in the coming years
The world has always had a way of surprising us with fresh, innovative and mind-boggling ideas and content for making itself and our to day to day lives a little easier every day. Coming up with solutions to problems that are faced by the people in their everyday lives seems difficult and stressful when it comes to finances, time, value and cooperation. But looking at each problem in various perspectives and having a great team to back you up, solutions to any problem can be found with just the human mind or should I say a collection of goal-driven minds working for the same objective by just seeking the satisfaction of solving real-time issues with real people in the Retail Sector.
India’s retail market is expected to increase by 60 per cent to reach US$ 1.1 trillion by 2020, on the back of factors like rising incomes and lifestyle changes by the middle class and increased digital connectivity. Online retail sales are predicted to grow at a rate of 31 per cent year-on-year to reach US$ 32.70 billion in 2018.
India is expected to become the world’s fastest-growing e-commerce market, driven by robust investment in the sector and a rapid increase in the number of internet users. Various agencies have high expectations about the growth of Indian e-commerce markets.
Luxury market of India is expected to grow to US$ 30 billion by the end of 2018 from US$ 23.8 billion 2017 supported by growing exposure of international brands among Indian youth and higher purchasing power of the upper class in tier II and tier III cities.
Information from https://www.ibef.org/industry/retail-india.aspx
So why are the Store owners not able to pull off these huge retail profits and numbers?
Well, let's look at the various problems faced by store owners and supermarkets in the retail sector of India in their day to day service
1. Lack of access to accurate and timely financial information Running a Supermarket can be challenging with a constant need to access more relevant financial and operational information about the business. With increased competition from other stores, the grocery operators are required to estimate high-level strategic analysis of the sales and margins by store department. This requires access to not only experienced accountants but also best-in-breed technology including business intelligence and analytics. Most of the small business owners have access to neither the resources nor the technology to address these concerns.
2. Escalating Labor Costs Controlling operational costs is certainly one of the biggest challenges that any grocer faces. Since grocery stores typically run on extremely low-profit margins, the need for a lean and efficient operation is critical. Labour costs are the single greatest controllable expense. Some grocery store managers have a tendency to cut labour during tough times. If labour cost reduction is not managed properly, customer service and store conditions may suffer. This, of course, results in lost customers and sales. Retailers that do not properly budget for necessary training programs will most likely see both increased employee turnover, which becomes very costly over time, as well as reduced customer service, due to a lack of training.
3. Low-Profit Margins and Sales Supermarkets operate with extremely low margins and rely on improving sales to generate profits. Profit margins can be very small in some cases, a supermarket’s net profit is less than 1% per rupee of retail sales. Moreover, competition limits a company’s ability to raise prices. As a result, Supermarkets struggle to survive due to a combination of intense price competition and low margins in the grocery retailing industry and are looking for cost-effective ways to improve their business profitability.
4. Managing Cash Flows In today’s business environment, grocery owners need to effectively manage the cash flows to improve their store’s profits. Effective monitoring & tracking business cash flows helps the stores to expand capacity, increase inventory, extend their product lines and penetrate new markets. However, tracking the cash flows is extremely challenging for the grocers as it requires access to high-quality financial reports and business intelligence dashboards.
5. Issues In Existing Store Systems Technology Generally speaking, most grocery stores and retailers have added technology at a conservative pace over the years, mainly due to precise ROI (Return on Investments) requirements. It is an industry that runs on very low-profit margins. New solutions need to demonstrate quick payback through increased sales and profits, and/or reduced costs to the operation. Technologies designed to improve the customer’s experience in the grocery store, such as faster checkout, customer retention, customer favourites and preferences. The impact of new system deployment, training, maintenance, and support can add to a retailer’s reluctance to simply accept the next new technology.
As technology has evolved over the years, most retailers have switched their operations to the latest tools and techniques except using older systems. Few drawbacks of existing technologies are given below:
Many systems either do not connect or are connected in a cumbersome manner that requires manual processes. Information is difficult to retrieve, and new releases are resource-intensive to manage
Some software purchased through vendors lack consistency in capability, have overlapping scopes, and are rarely integrated in terms of function or data
Many older applications are based on outdated architecture and are inflexible, making it difficult to change processes and business rules, add new devices, and so on, without touching the source code. This can present a competitive disadvantage for retailers as new innovations are made available over time
Older hardware is difficult and costly to maintain. IT departments have grown in size as technology has been deployed over the years
According to several studies of IT leaders, as much as 70% of a retailer’s information technology resources are devoted to sustaining and running existing capability, leaving only 30% for exploring and implementing new capabilities.
Data resource: https://www.quatrrobss.com/challenges-grocery-operators.php
Now that is a long list of issues which haven't been solved but it has been spoken about for a long time now. So is there no solution to making the lives and relations of Customers and Stores longer, stronger and easier?
We at Shopay, are a rising Start-Up in the field of Retail which is bent on solving real-time problems that are faced by both Stores and Customers. Here, we are trying to help the retail sector to solve day to day problems with the help of our innovative technology and dedicated team.
Shopay is a handcrafted system designed and developed by a team of brilliant and hardworking engineers which aims at helping the Customers of the Retail Sector by providing them with an easy, timeless and comfortable shopping experience in their regular store visits. But the most beneficially inclined people involved in our system are the stores, as we provide them with complete store Management, Customer Retention, Sales, New Customers and access to purchase analytics.
If we can organize a respective store and manage it by providing the store with all the data related to its regular and irregular customers using our application in their respective stores, the stores will be more concentrated on their customer needs and satisfaction rather than being too busy to tend to their customers due to manual or irregular store data and management. This will, in turn, bring customers and Stores more closely together as they can completely understand their customer's needs and preferences without having to speak or ask them directly with the help of our new system.