Supermarkets Make a Tryst with Record Sales on Independence Day

Top retail chains posted their highestever weekly sales in the six days to Independence Day, when heavy discount offers lured buyers to splurge on daily household products, apparels and consumer durables.

Retailers such as Future Group, Reliance Retail, Bharti Retail, RPG Group’s Spencer and K Raheja Corp’s HyperCITY — helped by active participation of several consumer product companies — offered deep discounts across product categories to push volumes at a time when consumer spending is slowing and there are fears of poor monsoon rains impacting demand.
“Consumers are looking at savings more than ever before,” said Rakesh Biyani, joint MD of the country’s largest retailer, Future Group, whose 164 Big Bazaar outlets across some 90 cities saw more than 8.1 million visitors during the week ended August 15. “We have been working to integrate our supply chain to bring down prices as far as possible.”
Several suppliers, including Coca-Cola, Britannia and Procter & Gamble, participated in special Independence week deals, helping retailers to offer higher discounts than before.
Darshana Shah, business head for marketing at HyperCITY, a hypermarket format run by Shoppers Stop, said increased vendor participation as well as entire malls going for sales helped pull in the crowds. “The sale was definitely better this year as we had stronger and bigger deals since market sentiment was soft,” she said. HyperCITY also increased its spend on marketing this year at around 2% of overall sales. During the week, Big Bazaar outlets sold more than 1.4 lakh packs of a combination of 5 kg of rice and sugar each with 5 litre of edible oil, and more than 1,500 tonnes of detergent. LED TVs, mixer-grinders and induction cookers were among the other top sellers at Big Bazaar, officials said.
Spencer’s Retail said its same-store sales increased 24% year-on-year during August 11-15, driven by beverages, health and beauty, bakery products and staples that saw over 30% sales growth. Sales of FMCG household products grew over 50% while liquor sales rose 30%, Sanjay Gupta, executive director (marketing & business development) at Spencer’s Retail, said.
Such discounting, however, reflects the escalating pressure on retailers, whose sales are slowing during non-discounted periods. “Because of the slowdown sentiment, consumers have been withholding purchases, so companies are trying to push volumes through discount seasons at retail chains,” said Mayank Shah, group product manager at Parle Products, the country’s largest biscuit maker.
But those volumes come at the cost of bottom lines, he added. Earlier this month, credit rating agency Fitch said same-store sales growth of retailers slipped across lifestyle and value-based formats in the quarter ended June, adding that it expects retailers to combat slowing sales by offering discounts.
“However, this may lead to an erosion of gross margins,” Fitch said, while revising the outlook for the Indian retail sector to negative from stable for the first half of this fiscal due to sustained decline in the discretionary spending ability. A slew of factors such as economic slowdown, deepening crisis in Europe, high food and fuel prices has impacted consumer sentiment in the country, slowing sales of everything from cars to carpets.
Some retailers use inflation as a marketing tool. A case in point is Bharti Retail’s “freedom from inflation” campaign at Easyday stores, which help people fight inflation by providing quality merchandise at low prices. Retailers such as Reliance Retail used the week to increase their customer base. Reliance introduced discount offers such as ‘double the difference’ price guarantees across various product categories.


Australian food, beverages to hit Indian supermarkets

SYDNEY: From Australia’s iconic vegemite to virgin olive oils, snack foods to gourmet sauces, and wines to fresh juices, quality Australian food and beverages are coming to Indian supermarkets this festive season.

Three Indian supermarket chains, SPAR, Hypercity and Nature’s Basket, and Indian import and distribution company Epicure Foods, have spent 10 days in Melbourne, Tasmania and Sydney to source quality Australian products for their fast-growing stores.

Cookies, confectionery, cereals, canned vegetables, juices and other products from 22 Australian companies are already on SPAR’s shelves in Bangalore.

“Many Indians are travelling the world and looking for international brands back home. About 35 to 40 percent of snack foods are imported,” SPAR Max Hypermarket India’s business manager Satish S V told media.

SPAR expects to import up to A$1 million (US$ 863,000 or Rs 37 million) worth of Australian products over the next year.

“Each of SPAR’s new stores will have two permanent gondola ends continually selling Australian products,” New South Wales (NSW) Minister for Primary Industries, Energy and Mineral Resources Ian McDonald said.

The supermarket officials have met over 45 Australian companies and experienced first hand what Australia has to offer.

“There is a general understanding in India that Australian food is clean, green and healthy,” Australian food consolidator Bemco Australia managing director Helen Pilakis told IANS.

The visit, organised by Bemco with support from the NSW Department of State and Regional Development (DSRD), follows a successful “Taste Australia” promotion held in Bangalore last November that introduced Indian consumers to more than 120 new food and beverage products from 22 Australian companies.

Most Australian products are targeted at India’s growing middle class, with huge disposable incomes, looking for ready and convenience driven products.

“Revolutionised retail with more shelf space is opening a new market where Indian customers are constantly looking for something new,” says SPAR’s senior category manager Nanda Kishore.

“At the moment, Australian dairy products can’t be imported into India, but buyers are hoping things will change by the year-end. We are looking at options for importing dairy products,” Kishore added.

Many Australian companies are producing food targeted at people with special dietary needs. Real Foods feels there is a market in India for its gluten-free rice cakes.

“Indians today are looking for gluten-free products and have a much broader flavour palate. Our expertise is in making six varieties of corn thins, thinner than normal rice cakes, which can be eaten as a snack, replacing a sandwich, or as a meal,” the company’s market coordinator, Charlotte Marbus, told media.

Another Australian company, Sweet William’s (William’s) makes vegan, gluten and nut-free, halal, kosher and sugar free chocolates.

“With high incidence of diabetes in India, people are looking for sugar-free chocolate bars. However, the prohibitive aspect of our product is the 60 percent customs duty on chocolates,” the company’s marketing and sales manager, Carol O’Halloran, told media.

Godrej-owned Nature’s Basket has already placed an order for salad dressings and sauces, cereals, honey, olive oils, biscuits and crackers.

“The products should be on our shelves by Diwali. Many of these products would be ideal for gift hampers over the festive season”, the company’s operations manager Sudhir Kadav told media.

“There is a wide range of cuisine available in Australia and we have noticed that retailers can ask manufacturers for specific products tailored to their specific markets”, Kadav added.

Supermarkets are looking at products that cater largely to the much travelled Indian clientele, non-resident Indians and the large number of expatriate Indians.

Mumbai-based HyperCity’s category managers for ready, gourmet and instant foods, Shweta Mohile and Y V Rao, said their company was looking at unique products, Australian Leatherwood honey, Macademia nuts, shortbreads, which can capture a niche market.

As Australia becomes more aggressive in its exports to India and the Indian retail market grows, Epicure Frozen Foods and Beverages managing director Sanjay Tandon and CEO (Operations) Murali Shankar said in the coming years, Australian products would be represented far more in their product range.

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