Modernizing precious retailing…

A few days ago, we discussed the future of modern retailing in Chennai. The Governor of the State, the Chief guest of the humbly organized meeting, vociferously underscored the need to modernize retailing at a faster pace. The Governor was indeed right when he said that modernization of retailing is the need of the hour.  A serious question came to my mind instantaneously on whether modernization is understood by all in the right context. Modernization of retailing is all about ensuring a transformation into adopting evolved processes and practices, transparent and fair to all the stakeholders of the business – government, customers, suppliers, shareholders and employees. It is actually a journey from doing business the traditional way to adopting scientific, fair and transparent practices of retailing.

Here’s an interesting area of need for instant modernization in Chennai: The moment one thinks about travelling within Chennai by auto rickshaws, it is not an exaggeration by any means to say that shivers go down one’s spine. A young friend told me the other day that whenever there is a need for him to travel by an auto in Chennai, he mentally prepares himself beforehand for the ‘ride’. The auto rickshaws of Chennai take every traveler for a ‘royal ride’. They seldom go by the fare meter and they always tend to test the passenger’s knowledge of the route to take and then decide to take the passenger on his royal long ride or on a city darshan depending upon his familiarity with the city! If the passenger happens to be familiar with the routes, the auto guy may demand an exorbitant bulk amount, flouting rules. For almost two score years now, no government has even tried to modernize this segment – a crucial determinant for retail customers to go shopping! Mumbai is fast adopting electronic meters in its auto rickshaws and the recent RTO drive to ensure uniform meter charges has modernized Mumbai’s auto functioning thoroughly!

Here’s a sector of retailing that needs to be modernized on a war footing. For many, buying jewellery from the so-called organized jewelers except from a few corporate ones can be a nightmarish experience.  It needs special intelligence for a common man to understand the pricing structure and rationale of gold and precious jewllery. The customer needs extraordinary negotiating skills, as there is no fixed pricing policy adhered to. Turning in old gold jewellery for new invariably goes through a process of selling the old item to the retailer and buying the new one, which involves the cost of wastage and purity loss calculated by the majority of retailers by unscientific, unfair and non-transparent means. Hardly do we find retailers following the transparent practice of determining the purity of the metal using the right process of melting the old metal right at the point of purchase and under the customer’s very nose for checking its purity and offering the right value. They offer a price for buy-backs based on unproven assessment methods but melt the metal later at the back-end refining point, which often begets excess earnings to the retailers. We have also not heard of KYC norms followed in the sector by many retailers, for high-ticket transactions.

It is true that Tamil Nadu has been the forerunner in the adoption of modern retail practices, even in the farm sector. The municipalities and ‘panchayats’ in Tamil Nadu have provided a common market space for farmers to bring their produce and retail from there every day. The farmer’s market is a daily market that opens early every day morning. The farmer can come and take his space for the day at a designated small cost and sell his/her produce directly to customers from there. This market not only helps rural and town customers to get fresh farm produce every day but helps the farmers to directly sell to consumers and not to middlemen (who often squeeze their margins) thereby increase their revenues. This is modernization of the right kind!

While fulfilling the responsibility of thanking the Governor for his keynote, in the inaugural session of the meeting, a retailer gave an assurance on behalf of all retailers that the advice of the Governor would be followed dutifully. It indeed felt nice to get the assurance and the joy of the audience knew no bounds, when the retailer himself happened to represent the jewellery sector!

- Dr. Gibson G. Vedamani