India 's Super Market Chains Essay

India 's Super Market Chains Essay

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This case deals with different approaches people took to develop super market chains in India. With the first approach occurring with Wal-Mart and Bharti, where Wal-Mart would operate the behind the scenes while Bharti would operate the front end. They decided to work on establishing a supply chain rather than rapid expansion. The next approach was taken by Reliance. Reliance started developing a retail chain that would include two formats and getting products from local farmers. Tata and Tesco went a different direction and went into the business-to-business market. This partnership had an understanding in the Indian market and global retail experience on their side.
Establishing food retailing in India comes with complications, some of these are due to politics and some are cultural. The first issue that most of the Indian community prefers to purchase their goods from local markets and farmers as opposed to large supermarkets. The articles mentioned that openings of large retailers showed a large volume of customers initially. However, the business did not stay, making it very difficult for large supermarkets to profit.
One of the biggest complications in retailers in India is the strong presence of political objection. There are many laws put in place that restrict the amount of trade retailers can bring into India. These restrictions make it difficult for international brands and have been the downfall of companies like Wal-Mart in India. The supermarkets that have the most success have been local Indian retailers that primarily focus on providing locally grown food.
The ending of the last problem is large enough to be a concern on its own. India has a very strong culture, and most of the communities prefer to eat fre...


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...which restrictions had been eased.
Lastly, the main resources and capabilities that Reliance focused on over time was the fact that “the supply chain cannot be outsourced, it is the heart of the business.” Starting in 2011, Reliance invested in supply chain systems to allow hourly updates on store performance and on product sales. Further investments were made in cold storage near farms and its own warehouses, greater testing of local assortment tailoring prior to store opening, and de-centralization of inventory decisions to local managers (instead of headquarters) to enable greater adaptation to local needs. By mid-2013, Reliance decided to focus expansion on the 700-900m² Reliance Super supermarkets, aiming to open 50 stores by the next year. They rationalized existing Reliance Fresh stores. They also thought that Grocery e-commerce was a new era of investment.

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