Two years back I visited one of the outlets of Subikasha with Family seeing thier Advertisement in one of the Media. But I really desappointed with thier high price & also the arrangement inside the store is also very poor ( Not attractive like Reliance, other outlets ). I think that could be the main reason to close their most of the Outlets in Bangalore.
Subhiksha is odd name now they will asking for Bhiksha..( begging )...it was an me too attempt without much study and experience...its really difficult to do away with round the corner kirana store in Indian context..
Re: Subhiksha...
by Sathish on Feb 09, 2009 12:55 PM
Kirana shops never sold anything at below MRP. Retail giants gave supply chain efficiencies and were able to get volume discounts. Hence in Big Bazzar a lot of stuff were available at below MRP. Customer is the winner in organized retail.
Look at developed markets like Germany to understand how organized retails brings goodness. There are hundreds of options in any product category like Oil or Bread. In a Kirana store, you can't read and compare the contents of cooking oil before buying. Choices are very limited too.
Re: Re: Subhiksha...
by bindhas on Feb 09, 2009 01:03 PM
yes it was initially ...but once the inaugaral euphoria ended...many of these big started charging high prices...initially vegitables at relaince were cheap now they are more expencive than the local vendor...again prices at all the stores are not uniform..yes one benefit is compitition but we really have to do a good research before shopping ...people who maintain monthly accounts with local shops.are also imprtant which is not the case with big shops...
Re: Re: Subhiksha...
by Ganesh R on Feb 09, 2009 01:09 PM
Very true both on Kirana store as well as Organized retail. But the organized retails in India, be it Reliance or Subhiksha need to sell below MRP for survival.
Watch out for Future group. Being a insider in this industry I feel there is a BIg HOLe in the books of accounts. Everything is not a rosy as it looks there. I hope Future is bright for Future group.
FIRST PENELISE ALL THE PROFESSIONAL FORECASTERS/BUSINESS ANALYSTS PREDICTING 20% GROWTH IN RETAIL, 25% GROWTH IN REALTY, ETC. MUCH HAVOC PLAYED BY MEDIA, BUSINESS ANALYSTS CREATING MORE HYOE THAN PERFORMANCE
Re: SUBIKSHA NOW, RELIANCE FRESH LATER
by Super Star on Feb 09, 2009 12:58 PM
Read today's ET. This Newspaper has glorified 100 fund managers who have halved the investors fund in the last one year. These fund managers get handsome bonuses for misusing poor investors funds and they make big statements about economy in such functions. In fact all analysts are number one chors, who ask you to buy stocks and sell their holdings in the same company.... all insider traders and frauds of top order. Hang all stock market analysts to save poor retail investor.
Re: Re: SUBIKSHA NOW, RELIANCE FRESH LATER
by Anant jain on Feb 09, 2009 01:38 PM
Bang on mate...all financial analysts use financial mumbo jumbo to impress the gullible investors...fact is all of them consters of highest order...moral of the story is in India never trust your money with anybody...no matter how reputed he is
Re: Re: SUBIKSHA NOW, RELIANCE FRESH LATER
by Anant jain on Feb 09, 2009 01:39 PM
Bang on mate...all financial analysts use financial mumbo jumbo to impress the gullible investors...fact is all of them consters of highest order...moral of the story is in India never trust your money with anybody...no matter how reputed he is
Re: SUBIKSHA NOW, RELIANCE FRESH LATER
by bindhas on Feb 09, 2009 12:47 PM
u got it buddy ...how abt starting it from our PMa and Pm who r economists themselves
Re: SUBIKSHA NOW, RELIANCE FRESH LATER
by subodh agrawal on Feb 09, 2009 12:48 PM
the compulsion for everyone is same as satayam had,to keep the shareprice high u start manuplating books and show good result afterward you get some smart marketing MBA who themself have neverbough 1kg of vegetable in Maraket to start bukiding demand model based on the theoritical book knowledge. the procurement team of thses company is also full of this idiot MBA who have never bought grocery from Market themself so the smart market operator take them for big ride and supply the non-moving items from thereshelf the owner who is sitting in central office has no idea waht is happening on the counter as he is busy meeting investors who are willing to buy his expansion plan india is a country of 120 crore out of which 90 cores are earnig less than Rs 20 a day and balance prefer to buy from local shopkeeper. unless some drastic major of owner/local mangement partenrship is put in place it will be difficult to make any profit in retail businees
Re: Re: SUBIKSHA NOW, RELIANCE FRESH LATER
by bindhas on Feb 09, 2009 01:19 PM
retail business in India is a totally diff ball game..you really cant compare with other part of the world..you cant compare wallmart,Jcpenny etc here...there are many traditonally run bus. and modern bus. run sucsessfully by college dropouts and non MBAs..practical experience is nucg reqd.
Re: SUBIKSHA NOW, RELIANCE FRESH LATER
by damodhar lal soni on Feb 09, 2009 12:46 PM
well said.absolutely, all these people who painted a rosy picture of this retail business r responsible for this mess.all should be made accountible. wait for the news of food world and biyanis big bazar
Re: Re: SUBIKSHA NOW, RELIANCE FRESH LATER
by Sathish on Feb 09, 2009 12:50 PM
Hmm. Organized retail in India has a lot of scope, really. If you look at footfalls in Bangalore Koramangala Forum or any Big Bazaar outlet, you'll see that the growth was for real. They were growing in revenues at 20% yoy. The bust has spoiled the party. But a lender should follow his norms.. Why lend to some company that has debt 20 times its equity?
Lenders dug their own grave. ICICI is a risky bank.
Re: Re: SUBIKSHA NOW, RELIANCE FRESH LATER
by Who Cares on Feb 09, 2009 12:50 PM
Ban all the Channels and hang the market analysts. What ever they predict for the day is absolute nonsense for the second day. PC and MMS has taken this country to the shit.
The real problems of Subhiksha are Low turnover and high overheads. it has very high breakeven level which is unattainable. The topnotcher from IIM Ahmedabad and IIT graduate has failed in business due to lack of experience and commonsense.
Re: Subhiksha is doomed.
by Power Base on Feb 09, 2009 12:20 PM
A wake up call for those who think that the IIMians and IITians are demi-Gods and whatever they do are a huge success. Very few cases, like this one, come to the light. After all, they are also human beings and as such are prone for failures.
Equity: 32 crores Debt: 700 crores D/E ratio: 22 (talk about overleveraging) Any sane bank will not fund a company if it has such a huge leverage. Public sector bank chairmen would have taken bribe from Subhiksha MD to keep funding it. Who takes the hit if the public sector banks give 'moratorium on interest & principal' for 2-3 years? It is the tax payer.
The corrupt PSU bank chairman who let prudential norms fly while lending to Subhiksha must be punished. It is another corporate fraud by PSU banks. But, alas, in this country noone is there to question is because it is a corrupt govt that runs the show.
Re: Debt-Equity ratio
by Power Base on Feb 09, 2009 12:22 PM
You have nont read the report properly; in Subhiksha's case, not any PSU, but a private sector bank (ICICI bank) is the main lender.
Re: Re: Debt-Equity ratio
by Sathish on Feb 09, 2009 12:45 PM
Its a consortium of lenders led by ICICI bank. In the last line of the report said a public sector bank executive... So I guess there are a few PSU banks involved, but they won't come out in media like ICICI bank.
Re: Another SATYAM
by Andy Rao on Feb 09, 2009 12:26 PM
I do not agree. There is no evidence of any malpractice here. This is just a case of business model not sustaining.
Being a vendor for Subiksha, we know that it has not payed dues from May'08 to all of us. Subhiksha will have to pay these dues in near future not for vendor's but for its own reputation.
