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Retailers near Wal-Mart outlets can benefit from proximity

Top global consultants say that having a retail outlet near Wal-Mart stores could beef up sales of these retailers.

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MUMBAI:  With global retail giant Wal-Mart set to enter the Indian market by mid-2008, top global consultants say that having a retail outlet near Wal-Mart stores could beef up sales of these retailers.
    
"Our case study shows that a large number of shoppers come to Wal-Mart stores as they offer goods at lowest prices. However, the nearby shops benefit from the crowd that is attracted by Wal-Mart," retail marketing and research company, J C Williams Group's Senior Partner, John Torella said on the sidelines of a retail conference here on Monday.
    
However, he set a list of dos and don'ts like the nearby retailers should try to stock brands different from those of Wal-Mart or create their own private brands. They should try and become category-dominant, he said.
    
The nearby stores must try and change their service timings. They could either open or close later than Wal-Mart, he added.
    
They must try and equal the returns which Wal-Mart offered to its customers, he said, adding they should also keep a customer data base. "They should also unleash marketing strategies come out with ads and flyers," he said.
    
Adding experience to the business is important, he said.

"The other retailers must make sure that their store environment is exceptional," he said, adding the retailers should be quick to adopt new technologies."
    
The country was likely to have a middle-class population of around 500 million by 2025, which would be more than that of the US.
    
"This middle-class will drive the retail market," J C Williams Group's Senior Partner, John C Williams, said.
    
However, he said initially the entry of Wal-Mart with the cash and carry format in the Indian market would not make any impact on sales of the other retailers, but slowly they would understand the market and adopt practices required for the Indian market.
    
Talking on real estate as a concern for the retailers, he said Wal-Mart was entering the market with a tie-up and for real estate too probably they might go in for a tie-up.
    
"Globally, they tie-up with real estate companies to get land at low prices," he said, adding "Wal-Mart is very dominant at pricing and it is almost impossible to compete with them in terms of pricing."

 

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