It’s been over six months since Gurgaon residents at DLF Phase 3 began to gradually get used to a charming new supermarket, called The Village Supermarket, in their neighbourhood. Located near the Delhi-Gurgaon border, the store welcomes customers with its warm, rustic charm created by the unpainted red brick walls, and the soft yellow glow emitted by the overhead lamps. Customers are pleasantly surprised by the store’s unconventional design, the beautiful arched doorways, wooden benches for seating, and the open courtyard.
Thirty-three year old owner Raghav Baweja is usually seen at the entrance, greeting customers or seeing them off. He is as unconventional as the store he runs. With tattoos, a crew cut and sporting a t-shirt and jeans, the young grocer is gung-ho, chatty, and full of plans and ideas for his store.
How it all started
The store has changed a lot of hands over the years: from a kirana shop to a Subhiksha store - and now a modern supermarket. After taking over the shop, Baweja increased the store space from 2000 sqft to 4200 sqft, using the adjoining land. From an unassuming kirana store sans air conditioning and POS, Baweja converted it into a modern format. Having spent seven years in London, he had a fairly good idea of what the store should look like when he undertook its complete renovation. What we see today is a modern convenience store with all the modern amenities, well stocked display shelves, and trained, friendly staff.
Baweja was confident that the supermarket would have a lot of potential in a large catchment of 15,000-20,000 families (largely upper class), especially when there was no other store equipped to meet the demands of the residents. To understand the catchment area better, Baweja initially sat at the cash counter and did the billing himself. When he started out, the average billing was Rs 180-200; today, The Village Supermarket generates an average of 400 bills of Rs 300-400. Reveals Baweja, “The average basket goes up to Rs 350-400 in the first two weeks of the month and then drops to Rs 250 in the last two weeks. This happens because people usually buy in bulk in the first two weeks.”
The new-age grocer is not new to the food and grocery industry. With a family background in retail, and a love for food, Baweja is not only aware of the nuances of the business but is also passionate about it. “I grew up amidst this business; in fact, one of the first grocery stores in Gurgaon - Crossroads - was started by my uncle. In London too I was into the retail business although it was not a grocery store, so I know the ins and outs of this business.”
Blend of rustic and modern
Gurgaon’s typical blend of rustic and modern has been replicated inside The Village Supermarket with its ceilings and brick lined arches, brown and beige walls, uneven patches of paint, offset by the modern POS systems, chillers and freezers.
“The village nearby is the inspiration behind the name and the distinct design of the store,” says Baweja. “Unlike the usual supermarkets with their white walls, plain shelves, white flourescent lights, we have given the store an antique look. We even spray painted the shelves to give them an old wood look. We will be using small wooden pieces for labelling the shelves, and adding more benches for our customers to rest on.”
Categories on offer
The store offers five large product categories, namely, bakery, meats, fruits and vegetables, grocery and imported foods like olive oil, pasta and cereals. Weekly suppliers maintain the fill rates in the store and for daily needs suppliers come twice a week. “We really don’t feel the need to stock. We have suppliers every week so we only store products which sell more. But we do have an inventory management software in place. Every category has a fixed shelf space which the supplier maintains,” informs Baweja.
The store also offers private labels in pulses and sugar, but at The Village Supermarket national brands are in demand. “Unlike places abroad where in-house products really work such as Tesco’s, whose in-house products are cheaper than any branded products, here, people prefer brands. I think it’s only the big companies that can launch own brands, and get bigger margins, and lure customers into buying them with attractive offers,” says Baweja.
Customer service
In keeping with its design, location and overall feel, the store attracts a mix of the affluent and middle class of shoppers, along with people from the village nearby. Although The Village Supermarket does not offer discounts, freebies or loyalty programmes like most supermarket chains, the store wins hands down with its customer care initiatives. Customers are welcomed by Baweja himself, and he does not spare any effort in creating a lasting bond with them. Once, when he found that a customer was unable to come to the store, he sent his car to pick her up from her home.
“What makes my store different is that most of my customers know me personally. I take time out and greet my customers at the entrance when they come to the store. I also have phone numbers of some of my customers and often send them SMSes. Retailing is not simply selling; it is about giving customers good service too," says Baweja.
Even though a security system software keeps him updated on all the activities inside the store through his mobile phone, Baweja relies more on his staff, some of whom have been around since the days of the Crossroads store. “When I took over the place, the staff was already doing their work; so I think they know the market more than I do,” he says.
Challenges
According to Baweja, one of the challenges that retailers face is the low purchasing power in India. “In the UK, people have a huge purchasing power and they will buy products which have a higher margin. There is no concept of MRP there so retailers have the freedom to price products according to the size of the store and the catchment area,” he informs.
He also faces price comparisons by customers especially with that at Big Bazaar. “Some people compare my store with Big Bazaar without really understanding the difference between our two retail formats. Big Bazaar is a very big retailer, with an immense purchasing power. Since they buy directly from companies, they do not have to deal with middlemen. Also, when you buy huge quantities you get a better deal on pricing, which a Big Bazaar kind of retailer can afford to pass on to the customers. We are just a convenience store, and our expenses and overheads are much more, especially when we provide facilities like credit cards, air conditioning, etc. So it’s unfair to compare us with the big players.”
Future plans
The store broke even in just three months since it started six months back. Baweja owes this to the low rentals, and the other businesses running alongside the grocery store. These include a cafe, a restaurant, and a thriving catering service from within the premises. There are plans for opening a wine section and a live bakery very soon.
In the coming months Baweja also plans to start an online grocery store to extend his reach throughout Gurgaon, especially the working class who have little time to buy grocery. “I would like to make a point of delivery where people can come and pick up their order. I believe payments should be ‘cash on delivery’ since cancelling orders would be very difficult when payments are made by credit cards,” he says.
Down-to-earth, upfront and realistic, Baweja feels that even though The Village Supermarket could do with some promotion, he is not ready yet, and is waiting to achieve a target Rs 1.50 lakh daily sales before he moves on to bigger things such as marketing. “I still do not have the confidence to say that out of the 100 people coming to the store 90 would go back happy. I am building up the store’s profile and creating awareness about it slowly. I have given it one year to reach recognition and status in the marketplace. Only then will I become more aggressive in marketing it.”