Value Adding?
Why do we do the things we do the way we do them? Often because it's been proven over time to be the best way, but sometimes through pure innertia. We seek to offer some original thought and opinion.
Western Supermarket Expansion into India
India represents an attractive growth market for western retail brands. With 6.2% annual retail growth and 26% in modern retail multiples the market's direction of travel is clear. Its scale is equally striking, with retail sales predicted to reach $587BN by 2015 from a current $435BN. What's best for India? Embracing established overseas brands which offer economies of scale and discounting or retaining their small scale entrepreneurial culture?
Having experienced the effects of the transition from a diversified high street to one dominated by relatively few brands and from a food sector previously represented by a range of independent specialists now by super and hyper markets, what has been the effect of the change we have experienced?
Positives include ease of use and price competition. Negatives, the loss of independent specialists, the growth of ready meals and waste. A disconnect between food and its source through over-packaging, an obesity epidemic fed by cheap alcohol and nutritionally dubious ready meals, a commoditisation of food regulated only by consumer choice and with little reference to producers.
UK milk producers forced to sell at cost by having expanded their operations to meet guaranteed volume demands from supermarkets, factory produced chickens being produced to meet the insatiable demand for cheap meat.
Indian consumers and regulators should look closely at the long term affect of western supermarket brands on consumer health and supply chains before offering them retail space.
