Friday, April 22, 2005

Cut it ....

FMCG companies and the retailers are meeting again – “to cut the costs”. Same old clich├ęd statement and efforts.
I think the entire industry knows that SCM is the bottleneck, and if the economy has to grow, the processes have to be streamlined. And when we say streamlined, it means one cannot proceed with thousands and thousands of “mom-and-Pop” stores, and the “Parchoonis”. First an effort has to be made at the back-end, like the textile industry in China – why can’t we have that model replicated for the FMCG as well?
Once we have a strong back-end, map it with a systematic and visible front-end.
Take a minute and think….Why is Wal-mart successful? Why do all the Chinese and Indian suppliers slaver at the very thought of supplying to the global giant?
It is not the brand name, not the customers, and not the market…
The visibility lures the suppliers, and the scale lures the retailers.
Come back to India, do we have these in India? Ask a HLL Brand Manager, can we think of an Indian Wal-mart in the current scenario? Ask Kishore Bhiyani, how much of imports does he command from the Chinese Industry?
First, these questions have to be answered and introspected for, and then we can call for EAN India (a trade body under the commerce industry) and AC Neilson reports.
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