In an exclusive interaction with Indian Retailer, Lalit Agarwal, CMD, V-Mart Retail, shares his views on the retail industry in India:
As you are rapidly expanding in tier I and II cities, what is your rationale behind it?
The rationale is very simple. We are targeting tier 2 and 3 cities because maximum number of Indian population still lives in the smaller towns. These towns or districts are inhabited by middle and aspiring class, where income group is usually between Rs 20,000 to Rs 50,000 per month. And V-Mart especially caters to the customers who require high quality products at affordable rates.
What is your differentiation strategy?
We do not want to differentiate with anybody. We want to do it only if it is logical. We try to use logical strategy i.e., offering value for money and affordable fashion products to our customers, who are looking for high quality products at reasonable prices. We accumulate products from more than 1,200 vendors across India.
What is your pricing strategy?
Looking at the type of customers that we cater to, we serve customers who earn Rs 20,000 to Rs 25,000 per month, but demand best of the products in that particular pricing range. For example, a shirt at V-Mart can start from Rs 199 and go up to Rs 700 or a trouser, which starts from Rs 495 can go up to Rs 1,400. There are multiple products with such kind of pricing strategy. We sell to all the segments of the society.
What are your future plans for V-Mart Retail?
We are planning to open 25 new stores by March 2015. We would add up to 25 new stores in our network this fiscal. Most of them would be in Uttar Pradesh, Bihar and in the states where we already have stores. Most of our new stores will have only apparels and lifestyle fashion products.
How do you see the retail industry pacing up in India?
Retail is the second oldest profession in the history. Up till now, we have been doing retailing in an unorganised manner. What we are now targeting is the – organised segment. Organised segment is pacing up, but there are several internal capabilities which need to be developed first within the organised players. India has great potential to absorb higher amount of organised retailing, which we are not able to do till now. In my view, things are improving and we see a lot of things happening for better.
How do you plan to compete with your competitors?
We prefer to compete with ourselves only. We always try to give better products to our consumers. India has several tier 2 and 3 cities, especially at district level, which are still untouched. We are entering into new areas, where no organised retailer is present. We are targeting youth and educated class there.