Blog: Mukesh – and his Maya-Jaal

( with grateful ack to “ K Lal and his Maya-Jaal “ )

Context :

· RIL looks to tap kirana stores / Hindustan Times (Noida) / 23 Nov 2021

For eight straight days, household goods salesman Vipresh Shah has failed to sell a single pack of Dettol soap to the storekeepers who have been buying from him ever since he took over his family business as a teenager, 14 years ago.

The 31-year-old said he lost $2,000 of his own money as he discounted products to match prices on Jiomart, the app rolled out by Reliance chairman Mukesh Ambani in his drive to revolutionise retail in India.

Up and down India, the mom and pop stores that account for four-fifths of a near-$900 billion retail market, are increasingly turning to Jiomart to stock up on foreign and domestic brands.

Just as Ambani has disrupted the country’s telecoms industry, the tycoon is intent on shaking up retail distribution, taking on US e-commerce giants like Amazon and Walmart Inc.

The country has around 450,000 traditional distributors, who have legions of salespeople to service every corner of the vast nation, including 600,000 villages. They typically earn a margin of 3-5% on product prices and mostly take orders physically once a week, making deliveries to retailers within a couple of days.

But Reliance’s model throws a wrench in that supply chain: The kiranas, can order goods on Jiomart Partner with deliveries promised within 24 hours. Reliance also offers training on ordering, credit facilities and free product samples for affiliated kiranas’ customers.

That means hundreds of thousands of salesmen representing consumer giants like Reckitt, Unilever and Colgate-Palmolive, face an existential threat to their business, according to interviews with salespeople, 20 distributors and a trader group with members across India.

Many of the distributors said they have slashed their workforce or vehicle fleet, seeing their sales from door-to-door agents drop 20-25% in the last year as shopkeepers partner with Reliance.

MY TAKE :

It seems like a case of :

# Distributors disrupted / decimated

# Intermediaries eliminated

# Middlemen marginalized

# Beginning of the End

# Playing out of the following script that I wrote 3 years ago :

MA = DA x 4,000,000 ? ……………….[ 17 July 2018 ]

Extract :

If you join Reliance Eco System, here is what it will do for you :

===================================================

SALES :

All of your merchandize will be available for selection / ordering on our ONLINE web portal

This online presence of your merchandize will expand / extend your " reach " to thousands of consumers in your neighbourhood

You will need to only focus on OFFLINE ( across-the-counter ) sales to consumers who walk into your store

For OFFLINE sales , we will install in your stores , all the necessary Computers / POS terminals / Routers / Internet Connections / Mobile Wallet Payment systems and an end-to-end , RETAIL MANAGEMENT software

All of your OFFLINE sales data will get transferred to our Central Server

===================================================

SUPPLY :

We will deliver to your store , all merchandize on " Consignment " basis

This means , you do NOT need to pay us for what we deliver to you store !

Till sold, all goods in your store will be our " stock "

This way, you do NOT need any " Working Capital " as far as your stocks are concerned

We will also tie-up with the manufacturers

You don't need to have any interaction / dealing with the manufacturers

===================================================

INVENTORY :

On a continuous basis , our web server will keep a track of each and every item of merchandize sold from your stores

Our Server will calculate , your " Stock Movement "

Based on this data, our Server will compute / set for each item :

# Minimum Stock Level

# Alarm Stock Level

# Stock Re-Order Level

# Re-Order Quantity ( Minimum Batch Size )

Based on this logic , our Server will instruct the relevant " Merchandize Manufacturers " ( or their dealers / stockists ) , to deliver the stipulated " Re-Order Quantities " to your stores

A " Re-Order Instruction intimation ", will get delivered to your computer

Upon arrival, you will need to update the data

From time to time , our Software will also figure out your current stocks of " Extremely Slow Moving " and " Obsolete / Expired " items , and arrange for " Return Delivery " , which you will need to enter in your database

===================================================

DELIVERY :

Not only we will deliver the merchandize to your store , but we will also pick up " Ordered Items " ( for ONLINE orders only ) , from your store and deliver the same to your customers !

Initially we will employ manual " Delivery Persons " for this but , before long , we will deploy a fleet of autonomous DRONES for this purpose

This fleet will cover " Kirana Stores " and " Online Customers " , located in pre-designated areas , covering 4 sq km ( 2 km x 2 km )

We are in talk with https://what3words.com/toddler.geologist.animated , to enable precise delivery through your 10th floor window !

These drones will get their " Delivery Instructions " directly from our Web Server , for all ONLINE orders

When these drones arrive at your Store to pick up the items ( to be delivered ) , they will transfer ( Blue Tooth / NFC ) and display on your Computer screen , following data :

# Online Order Number / time / date

# Items covered with description / value of each

# Customer Name / Address

# Mode of Online Payment / Bank Details

# Your online account CREDIT details , giving,

( Sales Value ) - ( Purchase Price )

" Purchase Price " of goods in your stock will be based on FIFO method

===================================================

FINANCE :

As explained earlier , you will have a bare minimum need for " Working Capital " , since all of your stock will be on " Consignment " basis

We will collect the " ONLINE PAYMENTS " directly from the customers and " Credit " the same to your " online sales account " with us

Against same account , we will " Debit " the " purchase price " ( price at which you purchase the merchandize from Reliance ) of the goods sold

Our server will also take care of all GST payments and filing of GST returns

As far as OFFLINE sales is concerned , all the data captured through POS terminal will get transferred to our Central Server

===================================================

MARKETING :

Not only will we carry out all marketing for your ONLINE sales , we will help you with your OFFLINE marketing , through introduction of the following technology-enhanced features :

# Arranging a better display of merchandize on your shelves / re-arranging of

shelves

# Introducing Augmented Reality ( AR ) for clothes / fashion goods in " Trial

Rooms " for giving the customers , an experience of " touch - feel - looks "

# Introducing Robots to answer customer inquiries

# Eliminating " Check Out Counters " , based on " Payments through Bio-metric

Recognition " of customers

# Embedding RFID sensors in each item of merchandize and RFID readers

embedded in Shopping Carts

# Improving your window display thru rotation

# Introducing music

# Eventually replacing " Physical " merchandize with " Holographic Display " of

merchandize on your store shelves !

===================================================

Since Reliance does not OWN any of these ( 5 million ? ) Kirana Stores, it is unlikely to introduce Amazon-like cashier-less automatic check-out

However, to know what kind of a VANISHING ACT, this Maya-Jaal will do, read :