How can Global retailers tackle competition in India?

Some ideas for global retailers to tackle competition in India -

1. Partner mom – n pop stores – retailers can offer franchise rights to local retailers for operating neighbourhood markets. This has a dual advantage –

a. In this scheme the local retailers retain their jobs and hence do not object to the international retailers’ entry.

b. This provides the retailers access to mass markets at faster pace and lesser cost.

The international players can take reap the benefits of the expertise, knowledge and experience of the local retailers in operating in that market.

2. Strategies to combat political opposition – to avoid fuelling the ongoing furor over FDI in retail, international players must -

a. Before appeasing the consumers, international retailers will have to appease the policy makers and other interest groups - They will have to first prove that they are not impacting the livelihood of millions of small retailers and vendors in the country.

b. Avoid violating laws and regulations

c. Practice CSR- international retailers are already under clout for tweaking the FDI norms to find enter the Indian market. To gain the confidence of politicians and general public, these players must contribute to the society and practice social development.

d. Keep a low profile in the country and keep politicians at bay

3. Don’t exert margin pressures on suppliers – international retailers, especially Wal-Mart, are known for exerting excessive pressure on suppliers to provide goods at wafer-thin margins. Wal-Mart has already burnt hands with this policy in the U.S. It is much criticised for being responsible for losses to suppliers. If it does the same in India, it will face political opposition.

Retailers must find others ways like and lifestyle retailing to make up for the margin difference.