Busi­ness has Im­proved Since Last Week of July: Metro Cash and Carry’s Medi­ratta

The Economic Times - - Brands: Creating Desire -

COM­PANY PHOTO well for us be­cause ki­ranas ear­lier were very ap­pre­hen­sive in May/ June and even in July. We have set up GST helpdesks in all our stores. Many of them didn’t even know how to ap­ply for a GST num­ber. So, we have peo­ple help­ing them. In In­dia, 40% of the peo­ple do not have li­cence to do re­tail. Of the re­main­ing, only about 20% used to have VAT (value-added tax) num­ber and the rest used to run their busi­nesses with other li­cences, like shops and es­tab­lish­ment, weights and mea­sure, in­sec­ti­cide, pes­ti­cide. So now the tax net could go up sig­nif­i­cantly.

Has busi­ness im­proved now? The busi­ness has im­proved since the last week of July. Some­how peo­ple have moved on. I have also found that dur­ing de­mon­eti­sa­tion, we had a bad Novem­ber but De­cem­ber was one of our best months and Jan­uary was again a great month. Sim­i­larly, July sales were im­pacted for al­most ev­ery­one. July last week on­wards the sen­ti­ments are back. There was a ma­jor sup­ply is­sue across a lot of com­pa­nies in July. On shelf avail­abil­ity for prod­ucts at our stores dropped from 94% to about 80% and is still not back to the 94% level.

When and how will cash-and-carry make money in In­dia? We keep a very low-cost struc­ture and we are do­ing a lot in turnover. We also own a lot of store prop­er­ties. Like in Ben­galuru we own stores. We own both the stores in Mumbai. We own the one in Hyderabad. One is the cost struc­ture. We also bring ef­fi­ciency and are strip­ping off a lot of un­nec­es­sary costs. We are able to com­pete in In­dia be­cause our cost struc­tures are very low. Also, a typ­i­cal hy­per­mar­ket would carry 4050,000 stock keep­ing units (SKUs), but we don’t carry more than 6,000 SKUs in our stores.

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