Conventional Wholesale-Retail Trade Continues to Dominate the Scene
In total contrast with the western countries, where formats like supermarkets/retail chains dominate the distribution system, conventional wholesale-retail trade dominates the scene in India. Again, unlike the West where a handful of apex distribution chains service the millions of retail shops, in India, stand-alone wholesalers/retailers dominate the scene. Some experts believe that before long, India too will see the massive growth of distributing companies/retail chains. Many others, however, feel that in India, large distribution outfits will not replace traditional distributors in the near future.
Image of the Trade is Changing
Till recently, the image of a stockiest/distributor in India was one of a cash-rich trader interested in quick profits. Such an image was a concomitant to the prevailing marketing environment. Many products enjoyed a premium, often in black, in view of the all-round shortages and the system of price controls. The distributive trade was making merry at the cost of the consumer. The situation has changed considerably in recent years. With the increased availability of products, removal of price controls, increased competition and increased choices to the consumer, the environment in which the distributive trade was operating has changed significantly; the distributor of today has to put in harder effort to sell his products and he has to service the customer properly. Naturally; his image has under- gone a change. Companies too are now keen to present to the public/consumers a cleaner image of their distributors.
Contemporary Channel Scenario in India
| ü Conventional wholesale-retail trade continues to dominate the scene, though formats like supermarkets, retail chains and shopping malls are making a mark. ü Image of channels/distributive trade undergoes a change. ü Profiles of distributor’s tool undergo a change. ü Trade margins escalate as costs of distribution keep growing. ü Expectations of distributors in the matter profits also change. ü The power equation among the distribution triumvirate—principals, distributors and retailers—shifts in favour of the lower levels. ü Distributors are becoming choosy. ü IT greatly influences the way marketing channels operate. ü Firms go in for different kinds of non-traditional channel arrangements. ü Outsourcing of channel task/ marketing logistic | ü Exclusive retailing ü Exclusive dealers without franchising arrangement ü Exclusive retailing through showrooms ü Exclusive retiling through shop-in-shop Franchising A. Firm go in for non-store retailing methods. Direct selling /home selling Multi-level marketing/Networking Marketing – Marketing by vending machines Consumer fairs. B. Firms go in for direct marketing methods. Mail order marketing/catalogue marketing Direct mail marketing Direct response marketing Database marketing Tele marketing Tele shopping (Home shopping) Online marketing/ Marketing on the web C. Equally radical changes are taking place on the retailing side |
