The Hindu Business Line : Kirana stores, getting refashioned by Hind Lever

In the midst of a raging debate on the fate of local kirana stores in the face of the fast emerging modern organised retail industry, Hindustan Lever Ltd (HLL) has embarked on a project that could give modern retailers a run for their money.

According to HLL, the `Super Value Store' Programme will exclusively target mom-n-pop stores by refashioning them to look like modern retail outlets. Apart from buying shelf space and in turn giving the retailer a three per cent discount on its products, HLL would also impart retail training and solutions to help shopkeepers add value to help them keep pace with changing times.

"The point of purchase is fast becoming an influential and critical step in the purchase process. With more and more choices available to the shopper, it's very important to have the right interventions to win at this last marketing mile. The programme, created as an effective intervention at the point of purchase, partners with the retailer to reach out to customers through special targeted promotions," said a company source.

The programme, in fact, has already started reaping its benefits. According to the owner of a South Delhi-based mom-n-pop store that is one of the programme's beneficiaries, "We have already seen a surge of 20 per cent in sales due to the programme initiated by HLL. Over and above, the shop also saves up to Rs 5,000-6,000 due to the scheme."

According to industry sources, HLL's Super Value programme is slated to service around 15,000-20,000 mom-n-pop stores.

"It's a win-win situation for both the company and the shops," said Ms Ruchi Juja, retail analyst, Crisil. "With the increasing number of modern retail outlets, their bargaining power is also increasing through demands of high discounts and freebies from FMCG majors. Hence, only supplies to modern retailers shows negative on the company's balance sheet. So, by refashioning kirana stores, the company balances out its margin levels. As for the kirana stores, there is growth in profits and a rectified ambience."

More Stories on : Retailing | Strategy | Personal Products | Hindustan Lever Ltd

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Kirana stores, getting refashioned by Hind Lever