Written By MONEYCONTROL NEWS

The biggest winner in terms of sales was BigBasket, which accounted for 50 percent of the sales growth followed by DMart, Grofers, Spencer’s Retail and StarQuick (Tata)

Representative Image (Reuters)

Online grocery sales for the largest online and offline retailers grew by a combined 65 percent to Rs 6,820 crore in FY20, while collective losses measured Rs 1,175 crore.

The biggest winner in terms of sales was BigBasket, which accounted for 50 percent of the sales growth, followed by DMart, Grofers, Spencer’s Retail and StarQuick (Tata), a report by The Economic Times said.

Moneycontrol could not independently verify the report.

BigBasket owner Innovative Retail Concepts clocked a net sales growth of 43 percent, or Rs 3,418 crore, while losses rose to Rs 424 crore, as per data with the Registrar of Companies and business intelligence platform Tofler, the report said.

Most executives and experts credit the growth jump to the COVID-19 pandemic and lockdowns, which pushed consumers towards online options for grocery and other purchases, it added.

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A spokesperson for Grofers told the newspaper that the value of goods the company sold in FY20 vaulted 88 percent to Rs 3,000 crore, with losses at Rs 637 crore, largely due to investments for strengthening delivery services and building awareness.

Among offline retail chains, DMart’s e-commerce business saw sales zoom to Rs 345 crore, with losses at Rs 79 crore. StarQuick operator Fiora Online saw revenue of Rs 33 crore against a loss of Rs 21 crore and Spencer’s owner Omnipresent Retail reported Rs 15 crore sales with a loss at Rs 14 crore.

Devangshu Dutta, CEO of consulting firm Third Eyesight, said that the customer shift to online propelled investments to enhance capabilities in the space, while a concurrent rise in the average order values would likely benefit companies with a “healthier bottom line”.

Nielsen noted that online sales in the FMCG segment were notable, accounting for 3.1 percent of the India market value–in metros this surged to 8.6 percent as of the September quarter.

Source: moneycontrol

“The industry has no reserves. And now with all the constraints from the curfew to the liquor ban to the reduction in the capacity we are all going to lose money for a few months. On top of the losses during the lockdown, this is very hard to recover from and hence many are closing,” said AD Singh, the founder and Managing Director of the Olive Group of Restaurants.

New Delhi: The restaurant industry fears 30-40% eateries (from the organized sector) will shut down shutters soon out of the half a million present in the larger cities. Popular restaurants in Khan Market, New Delhi have already announced closure and many to follow suit, as shared by industry sources.

Some ground realities

“The industry has no reserves. And now with all the constraints from the curfew to the liquor ban to the reduction in the capacity we are all going to lose money for a few months. On top of the losses during the lockdown, this is very hard to recover from and hence many are closing,” said AD Singh, the founder and Managing Director of the Olive Group of Restaurants.

It takes no science to understand why the restaurant industry is the worst hit as opined by the industry experts. The industry which thrives on socializing and creating good times with family and friends is surely the worst hit where maintaining social distancing now is the norm. Besides, one of the primary reasons for the closing of restaurants is that it’s a capital intensive business wherein the daily churn is required to get going.

National Restaurants Association of India (NRAI) President Anurag Katriar said the sustainability cost is very high in the restaurant industry. There is no working capital and there is uncertainty in business volumes going forward. The volume is expected to be subdued as will need cash to fund losses that restaurants are unlikely to get. Further, the operational cost including the rentals is very high to afford.

Even if the restrictions are not there, customers at this time will not be in that state of mind to dine out. Economic factors as well as the fear of spending some good amount of time (40 minutes to one hour) in a closed environment where many strangers will come and go does not look feasible for consumers.

Also, high rental is another cascading factor in the operating cost. Moreover, with the kind of guidelines to operate a restaurant business these days, many would not have the capability to follow such guidelines of social distancing and fewer footfalls, no liquor, etc.

“Eating out at restaurants is not a necessity, by and large; it’s a part of discretionary spending when you go out, socialize ― it’s all part of that. If you are not in a secure mind-frame about your future income, you will be as conservative as possible, and these are the kinds of expenditures that get knocked out first,” said Devangshu Dutta, founder, Third Eyesight.

“The restaurant industry was always a high mortality rate industry but the effects of the pandemic has been devastating. Some estimates say that 25-40% of restaurants may never open and even those that open will have to deal with low sales for a few months,” said Zorawar Kalra, founder of Massive Restaurants.

“I see the cost to sustain closure is very high. Many don’t have any resources which will impact the industry in such a way that 30-40% of restaurants will not reopen,” Katriar said.

Maintaining the utmost care in health and hygiene measures may prove a double whammy for restaurateurs. Firstly, it will add to their operating costs but they won’t be able to do away with this measure-as this is the only way to bring back consumer confidence. Adopting digital menus and digital payment solutions is another area they will have to travel around.

What’s in the offing?

Maintaining the utmost care in health and hygiene measures may prove a double whammy for restaurateurs. Firstly, it will add to their operating costs but they won’t be able to do away with this measure-as this is the only way to bring back consumer confidence. Adopting digital menus and digital payment solutions is another area they will have to travel around.

Besides, working with 50 percent or less of total capacity to ensure social distancing, the restaurants will probably have to get on the apps that provide online reservations, pre-ordering, and waitlist management to help minimize the queue of people waiting to be served. Popular restaurants have already started with thermal scanning for employees as well as consumers.

So, in the post COVID era, thermal scanning will be the new metal detection initiative that the restaurants will have to partake.

“Restaurants will have to opt for digital menus, contactless food, and sanitization among others. And with 50 percent occupancy, no alcohol and reduced working hours-restaurants will not make any money,” said Riyaaz Amlani, MD of Impresario Handmade Restaurants and the former President of NRAI.

Source: etvbharat

Indian retailers welcoming customers back as stores are opening up – a look at what changes are in store.

Oil shocks, financial market crashes, localised wars and even medical emergencies like SARS pale when compared to the speed and the scale of the mayhem created by SARS-CoV-2. In recent decades the world has become far more interconnected through travel and trade, so the viral disease – medical and economic – now spreads faster than ever. Airlines carrying business and leisure-travellers have also quickly carried the virus. Businesses benefitting from lower costs and global scale are today infected deeply due to the concentration of manufacturing and trade.

A common defensive action worldwide is the lock-down of cities to slow community transmission (something that, ironically, the World Health Organization was denying as late as mid-January). The Indian government implemented a full-scale 3-week national lockdown from March 25. The suddenness of this decision took most businesses by surprise, but quick action to ensure physical distancing was critical.

Clearly consumer businesses are hit hard. If we stay home, many “needs” disappear; among them entertainment, eating out, and buying products related to socializing. Even grocery shopping drops; when you’re not strolling through the supermarket, the attention is focussed on “needs”, not “wants”. A travel ban means no sales at airport and railway kiosks, but also no commute to the airport and station which, in turn means that the businesses that support taxi drivers’ daily needs are hit.

Responses vary, but cash is king! US retailers have wrangled aid and tax breaks of potentially hundreds of billions of dollars, as part of a US$2 trillion stimulus. A British retailer is filing for administration to avoid threats of legal action, and has asked landlords for a 5-month retail holiday. Several western apparel retailers are cancelling orders, even with plaintive appeals from supplier countries such as Bangladesh and India. In India, large corporate retailers are negotiating rental waivers for the lockdown period or longer. Many retailers are bloated with excess inventory and, with lost weeks of sales, have started cancelling orders with their suppliers citing “force majeure”. Marketing spends have been hit. (As an aside, will “viral marketing” ever be the same?)

On the upside are interesting collaborations and shifts emerging. In the USA, Jo-Ann Stores is supplying fabric and materials to be made up into masks and hospital gowns at retailer Nieman Marcus’ alteration facilities. LVMH is converting its French cosmetics factories into hand sanitizer production units for hospitals, and American distilleries are giving away their alcohol-based solutions. In India, hospitality groups are providing quarantine facilities at their empty hotels. Zomato and Swiggy are partnering to deliver orders booked by both online and offline retailers, who are also partnering between themselves, in an unprecedented wave of coopetition. Ecommerce and home delivery models are getting a totally unexpected boost due to quarantine conditions.

Life-after-lockdown won’t go back to “normal”. People will remain concerned about physical exposure and are unlikely to want to spend long periods of time in crowds, so entertainment venues and restaurants will suffer for several weeks or months even after restrictions are lifted, as will malls and large-format stores where families can spend long periods of time.

The second major concern will be income-insecurity for a large portion of the consuming population. The frequency and value of discretionary purchases – offline and online – will remain subdued for months including entertainment, eating-out and ordering-in, fashion, home and lifestyle products, electronics and durables.

The saving grace is that for a large portion of India, the Dusshera-Deepavali season and weddings provide a huge boost, and that could still float some boats in the second half of this year. Health and wellness related products and services would also benefit, at least in the short term. So 2020 may not be a complete washout.

So, what now?

Retailers and suppliers both need to start seriously questioning whether they are valuable to their customer or a replaceable commodity, and crystallise the value proposition: what is it that the customer values, and why? Business expansion, rationalised in 2009-10, had also started going haywire recently. It is again time to focus on product line viability and store productivity, and be clear-minded about the units to be retained.

Someone once said, never let a good crisis be wasted.

This is a historical turning point. It should be a time of reflection, reinvention, rejuvenation. It would be a shame if we fail to use it to create new life-patterns, social constructs, business models and economic paradigms.

(This article was published in the Financial Express under the headline “As Consumer businesses take a hard hit, time for retailers to reflect and reinvent”. 

Written By Editor

All schools in India have been asked to set up “school nutrition gardens” by the central government. The gardens will have to be managed by the students, with the help of staff and teachers.

The Ministry of Human Resource Development (HRD), which governs the education sector, issued guidelines for developing and maintaining kitchen gardens in schools in both urban and rural areas. The Government’s aim is to improve nutrition in schools, and also to connect children with the sources of food in an era of rapid urbanization and mounting environmental issues.

However, some schools have already embarked upon this journey well before the official guidelines came into place. One such is the Smt. Sulochanadevi Singhania School, Thane (Mumbai, India).

Students have been introduced to not just growing food within the school themselves, but grow it organically, without synthetic chemical inputs. The aim of the project has been to grow chemical-free, nutrient-rich vegetables and to provide an opportunity to learn by doing. The project is to teach the students how organic farming discourages environmental exposure to pesticides and chemicals, helps to build healthy soil, fight the effects of global warming and encourages biodiversity.

The students have sowed a wide variety of vegetables including cucumbers, chillies, lady’s fingers (okra), tomatoes, brinjals, spinach, bottle gourd, bitter gourd, ridge gourd, and capsicum, to name a few. The students have also planted paddy, to get hands-on experience of rice farming.

(Photos courtesy Smt Sulochana Singhania School, Thane, Mumbai. Check out more pictures on the school’s Facebook album.)

Source: billionfarmers