Retail in India is in. Till a few years ago few anticipated that India would turn out to be one of the biggest retail markets in the world. Born on an appetite of conspicuous consumption being the evil one combined with a little seasoning of socialism and the Indian way of life, few anticipated India would in 2007 turn out to be the top country in Global Retail Development Index (GRDI).
From Reliance to Tatas from the entrepreneurial telecom giant Bhartis to the just about any brand in the world, India is the destination and retail in India is hot like never before.
Technology behind the scenes
As retail expands and perhaps gets complicated behind the scenes in order to deliver that immaculate experience to the pampered consumer of today it's technology that providing the spine to retail. And it's here that tech giants like IBM amongst others are working on solutions created specially for the Indian retail market and are bullish in a way never seen before. According to IBM "IBM Retail Store Solutions (RSS) is one of IBM's fastest growing emerging-opportunity businesses". That investments in retail and investments in technology being used for retail solutions are growing can be gauged by the fact on one end giants like Reliance Retail, Spencers, Hypercity and DLF are going ahead with plans worth an investment of US$ 10 billion to set up retail outlets, on the other hand it's companies like IBM and other technology providers which are seeing a direct benefit from providing retail solutions to such companies. Consider the case of IBM. It's high velocity growth in this sector has continued in terms of a high double-digit revenue growth for seven consecutive quarters with revenue growing more than 25%.
It's products like SurePOS at one end of the retail chain to middle ware technologies like Light-Path Management besides other management tools that's providing the tech companies the surge in revenues. Consider the case of IBM's SurePOS 700 system, perhaps one of the industry leaders, IBM has shipped more than 3.5 million these point-of-sale units. Of these over 2.2 million are installed in more than 100,000 stores in over 100 countries. Noteworthy is from the consumer end retail hasn't yet touched the top gear. From Reliance to Bhartis to DLF, the bulk of the implementation is still in process and perhaps 2008 will see that. The kind of growth technology providers in retail will then witness will probably be a dream come true for service providers.
Retailing 2008 - A technology experience
From POS (point of sale) to inventory to accounting it's all about high end technology that's working behind the scenes to provide a seamless experience to the consumer. Consider as an example you walk into a shopping mall and pick up the things you want. Let's say you pick up a toothpaste, some oregano flavored chips and some French wine. The sensors placed in the mall detect your interests and through a pre-programmed algorithm display exclusive advertisements based on your preferences on the HDTV of related products in front of you. As you watch the HDTV your cellphone gets a time based voucher of a discount of 20% at a restaurant in the same mall. As you are ready to talk out a RFID reader auto tallies your purchase. You just walk upto counter and give the clerk your card to swipe who auto tallies your purchase and also gives your club points.
Sounds nice doesn't it? Well 2008 will perhaps see atleast something like above in a lot of malls in India.
If technology or talk about POS, middleware etc sounds boring I couldn't agree with you more. Two weeks ago I came across a very interesting 'nomadic' solution. Size isn't always that matters. Sometimes the round the corner book shop or the burger van has better, more delicious and perhaps juicer goodies than the big retail chain. This round the corner burger van had a (point of sale) IBM POS fitted with a system that synced the data via the internet to the central sever. Imagine the benefits a solution like this for somelike like an AH Wheeler book stores which has an all "over the railway stations" presence in India.
The Last Word
Interesting point of sale installations, cell coupons, RFID readers and what else? Perhaps technology in retail could be much bigger than we anticipate. The reason is simple the money that's flowing in it is simply overwhelming and this could invite a lot of interesting innovations.
Consider that Indian retail is the 5th largest retail destination and is estimated to grow from US$ 330 billion to $47 billion by 2010. Even if organized retail, which is just 4% (estimated to grow to 20%) the money in the market is simply too high. Technology is the spine of retail and we maybe seeing many more innovations happening around this in time to come. Meanwhile my fingers are crossed and I am still waiting for my cell to beep that discount voucher.
Puneet Mehrotra writes on technology issues. www.thebusinessedition.com