The 12-14 million retail outlets in India should generate a significant amount of transactional data, which can help brand owners track a variety of parameters, including the possible creation of some validated buying power index and market potential ranking.

Yet, actual retail sales data and trends are woefully inadequate. A small amount of consolidated data is possibly available from chain stores but is not enough. The sales patterns of these stores might not reflect the overall market and the fact remains that such stores are only 10 per cent of the overall retail composition. At the end of the day, going to the large number of conventional, standalone outlets is the only answer.

Market research firms try to get some feel by tracking sales from a sample of 20,000 odd stores and this is representative at best. In fact, there have been heated exchanges in the recent past, where the results from such studies were questioned by the brand owner.

Unlocking the data

So, the data is there and it is a goldmine. Can it be unlocked in a sustainable and viable manner?

This is definitely possible and the example of one kirana store is enough to see the extent of data that is available from a single data-point. A kirana store would have an average sale of Rs. 5,000-10,000 per day which could translate into a minimum of 80 to 100 items being sold. Discount 30 per cent of this as grocery items and maybe another 30 per centlocal products.

Now, imagine the data from 12 million outlets selling approximately 30 products per day. Imagine the untapped consumer preferences, regional bias, penetration detail and other variables, which hide within this — 12 million x 30 products x 365 days!

Therefore, an opportunity exists to introduce automation and, thereby, harvest accurate and validated sales data, while also improving the overall efficiency of the supply chain.

This idea was actually tried many, many years ago and did not take off as expected. Apart from cost, technology and connectivity issues, these small grocers were not comfortable with sharing an accurate record of their transactions and, therefore, their business. However, I feel that times have changed but no one has stepped forward to leverage this idea in today’s context.

I will outline some of the key elements with regard to this idea as also some issues and constraints that would have to be overcome.

Hardware constraints

The first is hardware. With the advances in technology and presence of net books, tablets, and other gadgets, a computing device with a basic configuration can be made available at an affordable cost. Add a simple printer for the bill and, if required, add an equipment, such as a scanner, to make life easier and the total price will still be within manageable levels. Finally, the icing on the cake would be to enable a USB data card or even a 3G connection, and the whole set-up is as complete as it can be.

Next is the software and this is where the tricky part lies. While the basic billing software is essentially like a calculator, the challenge will be in enabling and helping these shop owners to create a database of products for billing. There are global organisations that do precisely this. However, they have not made inroads into India. A collaborative effort between leading fast moving consumer goods (FMCG) companies should set the ball rolling, especially since these companies would benefit the most from such a flow of sales data.

However, it did not take off before because of the attitude of these shop owners. Apart from a concern about technology, which was based on poor literacy levels, the bigger worry was with regard to sharing their business details.

Changing attitude

Over the past decade these shop owners have also changed. The use of mobiles, computers at home and various other gadgets has reduced the fear of technology to a large extent.

This concern can be further reduced by making the usage of the software extremely simple and icon based to overcome the literacy as also the language barriers.

Next problem lies with the apprehension about sharing the complete details of their business.

This is not as large an issue as it was before but will still require extensive education and information sharing about how the whole package will work, what needs to be shared and what will remain confidential, to gain their trust.

The best part of this story is that the kirana owner will gain big time. Apart from sequential benefits, such as better fill rates and faster stock turns, they can also expect incremental revenue from this. After all, this data will definitely be monetised by others. This low-cost solution can even be implemented free at their stores to incentivise them to sign on and the incremental revenue stream will ensure their sustained buy-in.

Even if such an initiative has a penetration of just one per cent initially, it still translates to live sales data from 1,20,000 outlets, at the least. If it is well thought out and implemented properly, this idea has the power to redefine the Indian retail landscape, while creating a win-win situation for everyone concerned, especially the kirana stores.

Any takers?

(The author is an Indian retail expert, consultant and trainer.)

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