Indian retailers bank on IT

Shashwat Chaturvedi

There is a revolution that is steadily taking shape in India and gaining strength with the passage of each day. It is the retail revolution which promises a complete change in the way we purchase our groceries or vegetables. According to estimates, the Indian retail industry is expected to grow from $300 bn to $637 bn by 2015. Currently, the organized retail segment accounts for only 3-4% of the total market, but things could change as this segment (organized) is expected to touch 18% in the next few years.

Of late there have been reports of global retail biggies making a foray into Indian markets. Players like Wal-Mart, Tesco and Carrefours are renowned to be tech savvy. Will Indian players be able to match with them?

It is a loud yes. Indian players are not only matching, but also even excelling in the game of IT. Every single CIO that we spoke underscored the importance of IT for his company's prospects.

IT helps retailers manage their supply chain, inventory, etc in an efficient manner, and also brings improvement in terms of customer satisfaction.

While IT helps retailers manage their supply chain, inventory, etc in an efficient manner, the single largest improvement is brought in terms of customer satisfaction. "With IT we are able to run complex promotions, which otherwise would not have been possible in a manual system thereby giving a goof value for money for the users," says KVS Seshasai, head, IT and Corporate Quality, Trent.

Local Flavor

Yet, IT is not the panacea for all ills. One cannot fully depend on the off-the-shelf-solutions available in the marketplace, as Indian consumers offer unique challenges. One needs a system that lends itself to customization and localization, agrees Seshasai and cites an instance. "Take the case of MRP. India is one of the very few countries that have such a concept and not many systems are tuned to it. Fortunately, we had a system in place that made all these customization issues pretty  easy," he clarifies.

And yet retail is not all about those impressive malls, it is also the small kirana stores that dot the Indian landscape.

They seem to have lost out somewhere. Rakhee Nagpal, MD, DVS, seems to have a solution for this. "I strongly believe that 12 mn or so small retailers can also benefit from the boom. After all even in the West, the mom and pop stores have held their  ground in front of large retailers. They can also use IT to their advantage in their own small ways. There is huge  opportunities and it is open to everyone, big or small," she says.

In the Days to Come

Currently, there is a lot of talk about BI and data warehousing. RFID is another technology that has been talked a lot about.

But most of the CIOs contend that there needs to be an ecosystem before the technology is fully adopted and currently, the ecosystem is not ubiquitous.

Summing up, Indian retailers do not seem to be in anyway lacking in terms of technology adoption vis-à-vis their foreign counterparts. Maybe, it is the foreign players that need to get wary and not the other way round.