SUPER RETAILERS-ARE THEY WITHERING AWAY?

When FDI in retailing was permitted in India, every one thought that the small "pop and mom" stores would disappear from the Indian landscape. This Blogger was the one who argued that the super market chains can never compete with the unorganized retail sector in the foreseeable future, given their great resilience and personal type of service they offered to the Indian consumer. Though it is almost one and a half decades since organized retailing giants entered this business, none of them could become viable even to day! Their share in the retail market is a paltry 5% which is too insignificant to make any dent. Here comes a supporting report which talks about the decline of super markets in the UK during the last 10 years. 

"And yet a decade on, the supermarket sector is in meltdown. An overstatement? Hardly. In the cool-headed assessment of the Grocermagazine, the most authoritative voice on UK food retail, "consumers are abandoning supermarkets in their droves". Tesco, once the darling of the stock market, the government's pet performing British company, is in the most acute distress. From January to June this year, its profits crashed by 92%. Investigators have yet to plumb the depths of the big black hole in its books. Morrisons is also in a bad way – its pre-tax profit for the six months to August was halved. Sainsbury's share price has dropped. Even the supposedly trend-bucking Waitrose cannot be complacent: its profits for the first half of this year slumped by 9.4%. Overall, sales at the "big four" supermarkets – Tesco, Asda, Sainsbury's and Morrisons – have been stagnant, or in decline, since last May, according to new figures from the Office for National Statistics. Rating agency Moody's predicts that their profit margins and sales will shrink further. Two German discount chains, Aldi and Lidl, acted as the immediate nemesis of the fat, smug, greedy status quo of British food retail. They dealt a deadly blow to our familiar chains by exposing just how expensive they really are and continue to shave grocery market share off them. Before the discounters appeared, most British consumers swallowed the attractive proposition that UK supermarkets offer unbeatable value for money. In truth, they overcharge routinely, putting a minimum 30% mark-up on everything they sell, although the most egregious margins are systematically squeezed from sales of fruit and vegetables."

One of the strongest arguments while opening the sector to FDI was that foreign players would assure about their operations being able to support poor farmers of this country. Above report speaks about the power of the super market chains to force consumers to buy only those products with high profit margins and how healthy foods like fruits are vegetables are priced sky high! While many western countries have traveled a long way to confer almost invincibility to their retail chains by spreading their wings across the country eliminating small retailers totally, now they have nothing to fall back on even if consumers want to boycott them! In that way India is blessed with almost 8 million small stores distributed evenly through out the country and discerning consumers are likely to go back to these family friendly shops once disenchanted with the mechanical approach and impersonal attitudes of the big retailers. Hail the small fellow around the corner of our house who has been providing useful grocery service in the past and will continue to do it in spite of any move by the government to bring in large players in the name of farmers and efficiency of operation.

V.H.POTTY
http://vhpotty.blogspot.com/
http://foodtechupdates.blogspot.com

THE "INNOCENT" MINISTER-PERILS OF DEMOCRACY!

In a democracy any adult franchisee has a right to cast his vote and there is no bar for an elected representative to become a minister irrespective of his qualification and credentials. This is a strange phenomenon because for any job involving use of brain or physical power there are basic eligibility parameters which do not seem to be applicable to become a minister in any government. There are many ministers who are brilliant, capable of understanding the dynamics of democracy, work hard to improve the lot of citizens and contribute substantially to national development. But there are some with low credentials who feel that they are superior, beings destined to lord over people who elect them and tend to forget their roots. Here is an example of a "common" minister in the UK who is even ignorant of the cost of a bread in the market, the staple food he eats every day!

"The Food and Farming minister of UK, who manages the 7.2 billion pound farming industry, doesn't even know the price of a loaf of bread. Britain's farming industry produces more than 22 million tons of grain each year, but Caroline Spelman, the minister behind the department is unaware about the price of a loaf of bread. Also the Environment Secretary, Spelman issued a memo to officials in her department asking them to tell her the price of an average loaf. he instruction came in a 19-page briefing to staff in the Department for Environment Food and Rural Affairs (DEFRA). "The odd figure is helpful. Include examples of the price of a loaf of bread," the Telegraph quoted Caroline as writing. The price of a loaf of bread in the UK is currently between 1.30 to 1.40 pounds".

Of course with enormous perks that come with the post of a minister, probably his employees might be buying bread from the market and being a "busy" minister she might be having "heavy" official work leaving very little time to bother about the day to day chores of a normal family life. But being the food minister in the country, it is inexcusable for her to be oblivious to the problems of citizens, especially those related to food. One can only wonder about her insensitivity to the burden of increasing food inflation on the common man. India has its own examples of insensitive ministers in the States as well as at the Center and the recent reported agitation by the parliamentarians demanding sky-high hikes in their remuneration for their "services", before taking up legislative matters, can only tarnish the image of a country considered in the forefront of democracy.

V.H.POTTY

http://vhpotty.blogspot.com/
http://foodtechupdates.blogspot.com

THE "COLONIAL" MINDSET - BRITISH FOOD INDUSTRY DAMNED!

Ensuring human rights every where in the world is supposed to be non-discriminatory irrespective of religion, caste, color or creed. But in England some segments of the society seem to believe that only "white people" have such rights. This is probably due to the mindset of British people who do not seem to be able to overcome their colonial past in spite of its dramatic decline after World War II. Human rights violation is rampant in the UK is borne out by a recent report on the practices prevalent in the meat industry there.

"Some of the worst abuses were committed against pregnant women who were also forced to continue to undertake work that posed risks to their health, including heavy lifting and extended periods of standing. The inquiry uncovered frequent breaches of the law and licensing standards in meat processing factories - some of which supply the UK's biggest supermarkets - and the agencies that supply workers to them. It also highlighted conditions which flout minimum ethical trading standards and basic human rights. The report said: "Physical and verbal abuse were not uncommon, with a fifth of workers interviewed reporting being pushed, kicked or having things thrown at them by line managers; over a third of workers interviewed said they had experienced, or witnessed verbal abuse, often on a daily basis."It added: "Workers also reported being refused permission to take toilet breaks, and subsequently urinating or bleeding on themselves at the production line."

It is unfortunate that such things continue to happen in 21st century in spite of the rapid strides made by many countries in raising the living standard of their people. While the perpetrators of such crimes against humanity must be punished without any mercy, it is time Indian government makes migration of uneducated and under educated citizens from this country more difficult as they are going to face more and more such humiliations in foreign lands.

V.H.POTTY

http://vhpotty.blogspot.com/
http://foodtechupdates.blogspot.com