Friday, April 08, 2016

Unusual Occupations - The Grocer

THE GROCER   




Chottu runs Bhavana general stores, which is located round the corner from where we live. It is a mid-sized grocery and general shop that sells everything from milk to mosquito repellants that one would need to run a day to day household, all under one roof.

This is a neighbourhood that has seen abundance of construction and new development in the last 3-4 years thanks to being close to the Information technology hub.

Chottu’s uncles and relatives run many  grocery shops all around the city. When Chottu’s uncle invested in Bhavana general stores, the only customers around the place were construction workers who had pitched their tents and lived on the daily wages building out the apartment complexes and houses in the vacant plots of land around the locality. That was almost eight to ten years ago. 


The business model was simple. Staples like rice, wheat flour, oil and pulses were available in as little quantities as was required for two square meals a day till the next daily wage arrived. Occasional credit was given if the customer  found himself  out of work for a day or two due to illness or some other interruption.  The margins were obscenely high when you convert wholesale prices to retail prices in this kind of a business model. 
  
Over the last few years, the constructions took shape and landscape changed. Dotted with Apartments and some independent houses this concrete jungle is now a highly sought after locality to rent and buy for the new immigrants who make a living working in the Information technology and Business process outsourcing outfits situated just a few kilometers away from Bhavana general stores.     

Chottu, unlike what his name suggests is no more the adolescent boy that he was when he freshly arrived in Bangalore from his home-town in Gujarat after failing his class ten examination. He grew up along with the city. A little too soon and at a frenzied pace. Over the years, his uncle who had invested in the shop and set it up, decided to hand over Bhavana general stores’ proprietorship to him as a part of his family obligation. 

Their's is an extended family of five brothers. Chottu’s father, the eldest among them trades in wholesale pulses market  at the Agricultural produce market corporation ( APMC) in Navi Mumbai.  He procures his wholesale produce from Traders who procure them from farmers in Gujarat. His brothers and their families are scattered all over India especially in bigger cities. Chottu’s uncle is the youngest of the five brothers. 

Instinctively sensing the impending development, the family sent his uncle to Bangalore much before it was coined the silicon valley of the east. Over the years many of Chottu’s cousins have apprenticed under him running grocery shops of similar kinds all over Bangalore much the same way his other cousins have taken over or expanded family business from their fathers, uncles and other relatives.  Theirs is a close knit large family with firm traditional roots in this business.            

There are few customers of Bhavana’s who are now construction workers. Most of them have moved away to other construction sites after construction work dried up over here.  In keeping with times Bhavana has also changed its looks and the way it deals with customers. 

 About half a kilometer from the corner where Bhavana general stores is located, is Hypercity, the one of its kind supermarket that  stocks up international brand items including packaged foods from the Marks and Spencer.    When we moved into this locality and were looking out for a place to shop for our monthly groceries the choice was between Reliance fresh, Hypercity and Bhavana general stores. While I would have chosen a Reliance fresh, if not  Hypercity, my family chose Bhavana General stores. 

My folks are a product of the 1970’s India when being frugal was not so uncool, but a necessity.  Knowing something about the economics behind big retail business of the supermarket chains I have tried convincing them on this matter.  I have tried talking them out to understand that it is a myth that a big supermarket like Hypercity or Reliance fresh would sell their products any more expensive than Bhavana general stores. If anything, their mass volumes made up for their bargaining power with suppliers and things were bound to be cheaper in supermarkets than at small corner shops like Bhavana’s.

Like with many other things  we have agreed to disagree on matters where we think it is a ’generation gap’, with them firmly rooted in their age old wisdom and me in my new age thinking of how things will come to shape over the next few years in a more 'modern' and 'liberalized' India.

 For example, a decent level of affluence assures us not to have to depend on the monthly salary after the ‘pay day’ to shop for our monthly groceries anymore . Yet my folks unfailingly draw up the grocery list on the last day of the month and order for it on the 1st of the next month. That is how it used to be in their days when the pay day determined what days to shop, how much to shop and perhaps where to shop as well.

Chottu delivered our monthly groceries at home this afternoon as unfailingly as he does on the first of every month after he is handed over a hand written list jotted down by my mother in the morning when my father ventures out for his morning walk.  

I ask him about what he thinks about the foreign direct investment in the retail sector and its impact on small traders like him.  

In what ensued to be a long conversation after that, was a much more insightful than what I had come to believe reading half a dozen business magazines covering the pros and cons of Foreign Direct invstment in the retail sector in India. 

For starters I did not realize that Chottu could have been known by a more formal and respectable name like Suresh Aggarwal.  Every time I accompanied my mother for her ad hoc grocery shopping, she always reprimanded Chottu for this and that… for not stocking up her favorite brand of incense sticks or for not attending to her as quickly as he could have instead of ranting over on his mobile phone ever since he got engaged, for keeping his shop closed on every amavasya ( new moon day)  without caring for lost business or for not keeping a strict vigil on the boys who worked in his shop ( there were many more Chottu’s who were now his understudy).  He was not the one to take her ranting as serious customer feedback.  Rather he behaved as though he was used to reprimands and nudges from matronly middle aged women who were old enough to be his mothers. 

Suresh and the rest of the Aggarwal clan believe that while the Foreign Direct Investment (FDI) may change the retail landscape in India, it doesn’t worry them and they are confident their business model will survive.  He went on further to say that the members of Aggarwal clan go out to survey products and costs at the supermarkets all over the city. While big brand Supermarkets like Reliance fresh or Big bazaar give the customer big discounts on onions and potatoes or other such frequently purchased items, they make up for it by inflating the cost of oil, pulses and grains like rice and wheat. The not so smart  customer remembers the price of onions and potatoes she bought last week, but tends to forget the cost of Toor dal, tamarind and Atta, wheat flour  that she stocked up last month. 

That is a trick game small traders like the Aggarwals need to fight with the onslaught of Retail giants like big bazaar and Reliance fresh and the likes of Wal-Mart. I can understand Reliance and Big bazaar, but I was intrigued that a 10th class drop out and a small time grocer would mention the US retail giant Wal-Mart in his conversation. Wal-Mart is not even an existing retail brand in India with a direct presence at this point in time although it is supposed to have big plans for the future. He then went on to explain how small time Grocers like him differentiate themselves from the supermarkets.

Hyper city that is just 700 meters away from Bhavana, and is located on the main road  where you could only shop if you got your car because no residential complex exists in its vicinity. Not all people own cars and not all people who own cars might want to take their cars out to buy themselves some adrak-mirchi, ginger and chilly- the daily grocery needs of an Indian household from a supermarket like Hypercity.

'At 7.00 am in the morning when hypercity’s shutters are still down for stock taking, people like ‘Sir’( pointing to my father)  come to our shop to buy doodh-dahi – adrak – mirchi. ( milk, yogurt, ginger, chilies -everyday items in an Indian household) .This is how we  establish customer relations.  Once a customer trust is established and they understand the value of the relationship, our business with the customer is a repeat business'.


The Aggarwal’s or other people who are into this business open their corner shops very early in emerging localities and neighbourhoods where a supermarket will not venture for at least ten years into the future. They also study the people who live in that area and choose to open their shops in what economists would categorize as an area with a demographic profile of lower middle class / below poverty line people.  As affluence starts kicking in, they would temporarily loose some of their market share from the regular customers to big retail giants, but sooner or later these customers would come back to them.

There exists an abundance of population in this country that would do business with small shops because their prices are competitive and they are friendlier. By 'friendly' one assumes he means flexibility with credit that shopkeepers like him would extend to customers, affluent or otherwise which a more formal set up of a supermarket cannot afford to extend.  

I ask Suresh, if he was not concerned about the muscle power of huge capital infusion that the retail giants could command that would help them with mass procurement and seamless supply chain networks. It would enable them to bargain and get deep discounts directly from manufacturers, traders and farmers.

He answered saying all the money that they would save by direct dealing with wholesalers would get spent on overheads such as an air-conditioned infrastructure, modern management consultants and their hefty salaries, the inexperienced till boys and girls they employ, huge advertisements they need to put up inorder to stay on top and other overheads required to run a supermarket chain.   

I get a feeling he was being Naïve and his explanation too simplistic.  But soon realized it could just be his lack of articulation.   After all he comes from a family of traditional businessmen whose diaspora is spread out and firmly connected all across the world.

He went on to add that small shops like his, can afford to remain competitive with their retail prices because of their family and clan networks that enables them to have the supply chain linked directly with traders and producers. While his father trades wholesale at the newly set-up APMC in New Bombay, his grandfather and his great grandfather traded wholesale at the old Crawford market of what was then called Bombay. Since the last generation the family wholesale business decided to venture out into retail.  It is thus that his uncles and other relatives set out and established small retail shops and retailed all over the country. Their shops may be small, but the collective worth of their business is certainly not.

I asked him if he would mind if I took a photograph of him for a blog that I was writing.  On noticing that he was very obligingly posing for my camera, my mother chided him saying his wife was going to give him good when she saw his photograph on the internet.   
  
It took me back in time. Many times when that sullen, battered woman who swiped my card at the till in the supermarket before finalizing my purchases and wished me a mechanical  ‘good day Ms. Gopal’  after reading my name on my credit card with a practiced smile, I would smile back at her, quickly read the name tag on her uniform and reply thank you <name tag> … depending on what the name tag read.      

I now realize that, meaningful customer relationships could run far deeper than that and that it is'nt any modern management practice after all. Its has deep roots in the traditional set-up and the very make-up of this intricate, complex but seemingly primitive economy and it is not going to be easy to break that away any time soon.    

3 comments:

  1. I didn't think Grocer would count as an unusal occupation... but then Ir read your post and now I see what you mean :)

    @TarkabarkaHolgy from
    The Multicolored Diary
    MopDog

    ReplyDelete
  2. This was very insightful and sweet in a way. Hope he doesn't get in trouble with being on the internet

    ReplyDelete
  3. Not original and not at all unusual! I did not read - is there any change from the original one?
    Will you please add a 'repeat alert' next time!

    ReplyDelete

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