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In response, Reliance is building a supply chain that provides small vendors access to products as well. Although product transportation remains rather inefficient, with 40% of products going bad before even reaching customers, Reliance is confident that it knows the Indian customer and carefully avoids bombarding the country with stores, as Wal-Mart has done in other locations. The company plans to create a half-million new jobs and continue to expand the chain.
By the time other companies choose to move into India, Reliance likely will have a strong hold on the market. By law, international companies must partner with Indian firms to do business, so Wal-Mart and Carrefour have yet to expand to India.
The arrival of supermarkets represents a huge change for India, not only because of the change in consumer behavior but because it marks a shift in the entire retail industry. Ultimately, higher-quality products and improvements to the transportation system demanded by the new model should prove beneficial to the country.
Discussion Questions:
1. What steps is Reliance taking to ensure the success of its marketing strategy?
2. In a global marketplace, what advantages does Retail Reliance still have?
Laurie Goering, “India Grapples with Growth of Modern Supermarkets,” The Baltimore Sun, February 04, 2007.