M-Wars- Is the arsenal ready to fight the enemy within?

Retailers are constantly fighting to protect Margins, differentiate Merchandise and grow Markets. Is this M-Wars any better in India, comments Jayesh Desai, Senior General Manager- Cash Handling at Gunnebo India.
Is the arsenal ready to fight?

The article has been authored by Jayesh Desai, Senior General Manager- Cash Handling at Gunnebo India.

The Retail scene in India is no different. Actually, it is more intense and interesting especially because organised retail is still in its teens in India and the market is still growing. The M-Wars opponents in India can be broadly classified into four groups. These are the Pioneers of organised retail in India, the international players, the kirana (mom and pop) stores and the online-retailers. 

What is interesting that these groups are not only fighting the other groups but they are also fighting internally within themselves. None of these players are FIT enough to sustain a long onslaught and none of them is really willing to go out without a self-destructing fight. It can be argued that the Kirana stores will probably endure this war better, but I believe a decade from now, we will probably have even those taken out, only to be replaced by convenience stores.

As the war intensifies, the players are adopting and executing strategies that will increase their chances of winning. They all are investing in customer experience, operational efficiencies and technology. They are getting better organised and are looking at all opportunities that help them get an edge over others. What is apparent to all of them is that the war is long, the field is changing, the opponents can change groups and the government can switch between being a friend and a foe on a dime. 

You have to be fit to fight this war and being fit means that you take care of the enemies within yourself with a vengeance. One of the enemies within for all these retailers is Shrinkage and depending on their size, scale, format and merchandise they offer each of them a different approach to engage this enemy.

Shrinkage is a concern for almost all retailers globally and is something that they diligently work on improving. Though conventionally linked to inventory losses, the word shrinkage over the years has evolved to include other losses linked to mismanagement of Cash, wrong/over reporting of payables and under reporting of receivables etc.  Cash continues to be the preferred tender type being used by customers globally and that constitutes both an opportunity and an expense for retailers. Cash is probably the easiest tender to be used at the checkouts, does not accrue any fees for both the customer and the retailer and is realised instantly for the retailer. With a huge parallel economy being in play in India, according to RBI data, cash still accounts for 90 per cent of all monetary transactions in India. While credit cards, debit cards and contactless mobile payments are on the rise, these alternative payment methods are merely complementing, not replacing cash usage in India. More cash, though welcome as a tender type, means more costs for the retailers. Cash needs to be counted, recounted, reported, audited, collected by CIT and deposited to the bank and each of these processes is both labour intensive and also a potential shrinkage loop-hole.

To plug these potential loop-holes, retailers are increasingly adopting Cash Handling solutions in their operations. Cash handling solutions help retailers reduce and completely eradicate the need for multiple people having to handle cash in their operations. These solutions can be deployed at the checkouts and at the back offices and also can be integrated with the CIT and the banks.

  • Cash handling solutions help retailers  
  • To Issue floats to the cashiers automatically at the start of the day
  • Automate the cash collection process from the customer (the customer payment is done directly to the machine at the checkout)
  • Cashiers deposit their collections at the end of shift in the machines directly
  • Automate the reconciliation process at the end of day
  • Get immediate credit into their bank accounts once the cash is deposited in their back office
  • Prevent loss on account of counterfeit, as the Cash is check for counterfeit at the checkout and or at the back office
  • Reduce loss on account of robbery as Cash is stored in graded intelligent safes all the time

Cash handling solutions can be integrated into POS systems, for instance, to ensure proper reconciliation. Retailers can also choose front office or back office integration so that the required amount of cash is automatically dispensed to cashiers. The use of automated cash handling leads to not only more productive employees focused on serving customers, but higher sales and profits along with improved security for both staff and customers. Cash handling solutions also equip the retailers to fight the enemy within i.e Shrinkage.

As with every war, there are winners and losers, victories and defeats, stories and nightmares. And we sure will have all of those at the end of these M-wars. What is different though is that this is a perpetual war and the only way opponents will stay on the war-field is by fighting the enemy within with a vengeance. The question is not whether you are ready or do you have the intent, it is “how are you fighting?” and I believe Cash Handling Solutions should be part of your arsenal.

Publish Date
Not Sponsored
Live: People Reading Now