You can now have vegetables cut free


February 24, 2012

Shilpa Phadnis , The Times of India

Bangalore, February 24, 2012

Homemakers are likely to love this – someone cutting vegetables for them for free, someone making chappatis for them, again at no charge.

It’s the latest from Future Group’s value retail chain Big Bazaar. They call it the Seva initiative, and the store at Rajajinagar in Bangalore has become the first to launch the services.

Customers in the store can choose from a combination of different grains that go into making a dough, and the store staff will then grind, knead and make it into fresh chappatis. The promise is that the entire process will take no more than 12 minutes. Customers can go to the vegetable counter and get the vegetables sliced and diced in different styles for free.

The ‘sevaks’ at the 1.3 lakh sft store will assist customers in availing free after-sales service for the electronic goods they purchase or in identifying a vendor for dry-cleaning their carpet. The store even has a Bangalore One counter where they can pay electricity or phone bills, and avail other public services.

"We don’t merely want customers’ share of wallet or mind. We also want their heartshare," said Ashni Biyani, director of Future Ideas, the innovation and incubation cell of the Group.

The retailer incurs additional costs to deliver these free services. But analysts say the cost is mostly related to labour. "This is a clever strategy to attract customers at relatively low-incremental costs," said Hemant Kalbag, partner at consultancy firm AT Kearney.

Usually, the cost attached to delivering a service gets embedded into the product. "But free give-aways along with experiential marketing become a hook for customers, which could potentially translate into a higher billing size at the counter," said Devangshu Dutta, chief executive at retail consultancy Third Eyesight.

The Future Group has both internal and external pressures to try and find innovative ways to build a more robust business. External pressure comes from Big Bazaar’s competitors like Spar Hypermarket, which offers a better ambience and attracts more upmarket customers. Big Bazaar has been upgrading its stores to enhance customer experience, and Seva can be seen as part of this. "Big Bazaar stores launched in the last one year are less chaotic and resemble a Spar," said an analyst who did not want to be named.

Internal pressure for the Group comes from its huge debt of about $1 billion and high interest cost, which has impacted profitability. The retailer is working on a plan to turnaround its retail operations. It is exiting some of its non-core businesses and shutting down loss-making stores. It has closed five Food Bazaar outlets and 11 E-Zone stores and has laid off 3,000 people in the recent past.

To cater to more evolved customers, the Group is rolling out FoodHall, a food store for value-added food products and international food ingredients. The Seva initiative will be rolled out to 12 Big Bazaar Family Centres in the next two months. The Family Centre sub-brand makes customized product and service offerings based on the needs of the people living in and around the catchment area.