Small
cattle markets unable to take Indonesia slack
Tuesday,
08/01/2013
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Despite the live cattle
export industry attempting to expand markets in Asia, numbers out of the
Northern Territory in 2012 fell by 22,000 head.
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Indonesia remains the
major buyer of north Australian cattle, with 246,990 exported from the Port of
Darwin.
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Shipments in the last
12 months to other markets increased slightly with the Philippines buying
27,324, Malaysia taking 10,018 and Vietnam taking 2,801.
·
Although cattle have
been sent elsewhere, none of the markets are in a position to replace
Indonesia.
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The import permits for
Indonesia available to exporters for the first quarter of 2013 won't last long.
FDI in retail: Forecast for
2013
The FDI policy was modified
in September where retailers were allowed to invest up to 51 per cent in
multi-brand retail, but since then there has been no names seeking the approval
of the Department of Industrial Policy and Promotion (DIPP) or the Foreign
Investment Promotion Board (FIPB). What is the reason the investors are shying
away from investing in India?
It may take another year before the economy
smells significant foreign direct investment.because
Ø
Global slowdown of economies is one big reason for this
cautious approach.
Ø
India may have approved FDI but it would be interesting
to see how the states welcome the investors.
Many of the companies eyeing
a business in India want to go through a lot of research and market analysis
before they invest in this highly sensitive market. IKEA and their proposal has
been into the files for more than six months now and the whole process of
seeking an approval will certainly be the pathway which others will follow.
IKEA’s entry will be encouraging for many more.
H&M Hennes and Mauritz
AB are among the big players wanting to enter the market, pegged currently at
$500 billion. Though 100 per cent FDI is allowed in single-brand retail,
H&M may opt for the franchisee route in 2013. International giants like
Walmart, Tesco and Carrefour, which are already there with cash n carry format,
need to formulate their plans for the front-end operation.
The forecast for FDI in
retail in the year 2013 does not seem to be as bright as many would be
expecting. Some more time for the Indian retailers to pull up their socks
before they compete with the giants.
Assocham
reports 55 % vacancy rate in
malls in Delhi-NCR
As per a survey carried out by The
Association of Commerce and Industry of India ( Assocham) of the malls in
various cities across India, the vacancy rate in malls in the Delhi-NCR region
is the highest at 55%. Mumbai was not far behind, showing a 52% vacancy.
The survey attributed the poor occupancy in malls to reasons such as the economic slowdown, poor design of the malls without adequate parking, bad locations and the lack of robust revenue generation model. With existing malls operating at 60% occupancy levels, the retailers are not willing to set up shop in a space that does not have the energy of a vibrant retail zone The Survey reported Chennai to have a vacancy rate of 50%, followed by Hyderabad at 48% and Bangalore at 45%
The Assocham survey reveals that this has
lead to significant delay in the construction of several malls. The shop
owners covered in the survey have noted that increasing rents will not work
because at the end of the day it has to be affordable for retailers to do
business.
India has over 1,200 shopping malls, with several in varying degrees of construction.
CCI approves restructuring of Future
Group's fashion biz
Ø The fashion
business of Future Ventures, Indus-League, Lee and Pantaloon Retail, all of
which belong to the Future Group, is proposed to be integrated into a single
entity Future Lifestyle
Ø Futures Ventures
holds 95.29 per cent stake in Indus-League. About 4.69 per cent shareholding
in the company is held by Bennett & Coleman
Ø Future Lifestyle
holds 9.52 per cent stake in Future Ventures.
Ø Lee Cooper, an
apparel major, is a subsidiary of Indus-League. Future Lifestyle is part of
Pantaloon Retail.
Rural marketing magazine covering India on stands
To provide factual,
analytical and all inclusive information and insight on rural India, i9
media, a media house, has launched a rural Marketing magazine, ‘Rural
Marketing’.
Sharing his insight
on the need of a rural Marketing magazine, Mr. Ajay Adlakha, the Publisher
and the brain behind the Rural Marketing Magazine said “Today, with the
Indian Rural economy touching US $ 1 trillion, is witnessing a whooping
growth of 30% per annum as compared to urban sector which is growing at a
rate of 10% pa. The current revenue generated by Rural Consumer Market
accounts for US $ 425 billion up from US $ 266 billion from previous
year. The growth of rural GDP is so high that today it equals to urban GDP.”
“In spite of having huge untapped potential & revenue generation capacity, the country has no dedicated magazine catering to this segment. “This first of its kind ‘Rural Marketing magazine’ will be a guiding force to the policy makers, Corporates, Marketing, Advertising, Branding and Media agencies to help them to tap the vast untapped potential of Rural India representing 850 million people with a current estimated consumption of about Rs Four Trillion per year.” With its nationwide presence ‘Rural & Marketing’ magazine will bring forward the fine points & insights on rural India from across the country. It will also act as an eye-opener for various companies & policy makers, helping them in shaping business strategies & policies on how to target the rural India and its consumers. The content of the magazine focuses on areas like Rural technology, Rural Tourism, Rural sports, government polices & education.
Rural marketing: Say no to price wars, relationships
key
Rural India has
been in the spotlight for a while now, with growing consumption rates. Middle
India, home to about 100 million people, is already contributing to 20
percent of the country’s FMCG consumption, as per recent media and industry
reports.
Further, sector
estimates say rural India has 31 million active internet users. This is a
growth of 73 percent from 2.13 percent of active internet users in 2010 to
3.7 percent in 2012.
So a young
population, rising income and low penetration of consumer durables makes
these markets lucrative for new entrants. However, the consumer mindset here
is quite different to that of the metros and A-class cities. Therefore,
entrepreneurs must be mindful of a few important aspects in this regard, to
ensure they market well in these regions.
Create brand
reputation
The bond between
retailers and consumers in tier III and IV towns tends to be quite strong and
often extends into the personal sphere. AFP
While brands do
have some relevance, in-store recommendation by store owners can override a
lot, so a good retailer can sell an unbranded product with ease.
Retailers, in
general, are seen as subject matter experts by a lot of consumers unlike in
urban cities, where a store assistant is a mere facilitator of a transaction.
So, the first thing you’d need to do is talk about your brand to this
segment: store owners, traders or merchandisers, those who will be an active
partner for the product or service you are selling. Get them to understand
the underlying values.
Build relations and partnerships
A lot of trade
happens on credit and personal relationships and sales without providing a
bill is almost a norm in these markets.
The bond between
retailers and consumers in tier III and IV towns tends to be quite strong and
often extends into the personal sphere.
So if you are
setting up your own stores, you’ll have to work around processes that adapt
to such nuances. Big and fancy stores used to intimidate consumers (as they
tend to give the perception of being more expensive), but this is slowly
changing. Similarly, if you are looking to partner with existing retailers
and sell through their shelf space, then these are the systems that you would
be experiencing.
So plan your
inventory and supply-chain management accordingly. Needless to say, this
depends on the vertical you are in.
Standalone stores
work well for consumer durables; however, for apparels, personal care items
and the like, selling through existing stores in shopping complexes are
viable options too.
Franchise your way
in
Franchising is a
feasible option too, to create a network and reach consumers. Franchisees
would be well-versed with buying patterns of consumers in these markets and
for a retailer, this would be highly useful to know your consumer profile of
that particular town. You will need to do lots of groundwork on where the
customer is and how to reach them. However, remember, franchisees may not
have empirical data but more anecdotal, and therefore you’ll need to conduct
a well-mapped survey to understand the market and gaps therein.
Say no to price
wars
As a first
generation entrepreneur, without the weightage or backing of big names, it is
advisable not to get into price wars.
Existing retailers
have strong associations and can drive you out of the market. The key to beat
an established retailer with sound reputation and influence in these markets
is to do something innovative.
In tier III and IV
towns, this is not a difficult deal to crack. Lure customers with nicely
dressed promoters, a clean, neat shop with air-conditioning, and ample
parking place.
Plus, they look for
value for money and functionality of the product rather than the luxury or
lifestyle element, so play on the former.
Contrary to what
people think, real estate capital costs are high, so opt for rentals if you
are setting up base.
Marketing mantras
You will need to do
a bit of marketing to complement the above-mentioned initiatives. However,
your modus operandi will have to be old-fashioned in some sense and social
media is not the way to create awareness.
The plus side is
cost of advertising will be less in comparison to urban markets.Hoardings and
newspaper inserts work best, say experts. In addition, advertising through
cable television and slides in cinemas are good options too as are fairs,
small events and exhibitions to create some noise.
Customer relations
are equally important here. Never ill-treat them as customers in these towns
take things personally. If not treated well once, he/she would never re-visit
stores or buy your product/ service, no matter what value you offer.
Brand ambassadors
sell products and services well too. If you don’t have the big budget that is
needed to bring in a Hindi film industry celebrity, you can also opt for
television anchors to come and inaugurate the store or attend the product
launch.
They will always
draw in the crowds and ensure a better visibility for your brand.
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