Saturday, May 14, 2011

Buy Cheap Provisions in Chennai

This time am with ideas of buying best and cheap provisions for personal home purpose. Did anyone thought why big giants are pondering into FMCG products and start supermarket. Major players like Reliance, More, Food World, Nilgiris and who not... every one are into supermarket. Simple reason, they procure goods centrally from manufacturer and distribute, which makes their purchase cost at down the earth prices and gain more in FMCG goods.
All these supermarkets play well by giving promotional offers, attractive gifts, reward points, membership cards, discounts, but anybody thought how they make profit out of this? simple the MRP mentioned in the goods are the maximum and they sell at this price, which is 5%-20% more than the actual purchase price.

We have many retail shops who sell the same FMCG product, same brand, same weight, but at a different price,   less price than MRP. How can that be possible for them? How do they make profit out of that? Very simple, they do not expect 20% profit instead they look for minimal profit.

As a resident of chennai, I have explored many provision stores in and around chennai and looks like we have to be more careful in spending our hard earned money. Am sure government cannot take any action on this, atleast let us be careful in this.

Below given example is from my own experience an am not urging you to take up my steps. But if you find this article useful, do reply to me with your comments.

Every month I purchase the below items in Jeyachandran Stores (near Tnagar railway station) and this is what I save. The price listed below are as of 14-Apr-2011.

GRB Udhayam Ghee (MRP: 180) - Rs.158, almost 15% less
Udhayam Dhall - 10% less than MRP, Example Rs.80 Udhayam Thoor Dhall is only Rs.72
Pediasure - 15% less
Soap, Paste, Washing Powder, Detergents, Provisions - everything is 10% less than MRP
Oil - 5% less than MRP

Readers please note, this shop is in the most crowded part of TNagar and 80% of the people do not wish to visit and buy from here. Again purchase ONLY branded products from here.

Till now I was promoting Jeyachandran, now more about the wholesale market in Chennai. Parrys or George Town are the places where you get all products in wholesale price, i.e., very very less. but problem is you have to travel a long distance and the money you save is spent for Auto or Bike or any other mode you travel.

So readers, start thinking and start saving... Happy Saving :)

50 comments:

  1. This is a really good read for me, Must admit that you are one of the best bloggers I ever saw.Thanks for posting this informative article. Perhaps you just need to take a series of deep breaths and focus on something else for a few moments

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  3. it is realty good to read.but u can try silicon fresh home delivery store there you can get less price at your door step.

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  4. Dear Friend,
    Am Satheesh Paramadayalan from chennai. Thanks for posting this informative article. The informations you provided regarding the retail business and its methodology are so clear to me. Am in thinking of starting a retail business in chennai. I hope that your a good in business and motivated person. I need your help for me to start business in this Retail. Hence i would like to get your kind advice and motivation would help me to proceed further into this.

    My contact number is 9941012008 and mail id: satheesh.dj@gmail.com

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  5. This comment has been removed by the author.

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  6. The retail market in India is very mixed. I would like to point out a few things in here. Does this Jeyachandran Stores guy hand you a bill? A computerized one and not ink on some waste paper? Even if he is issuing you a bill, there is a high probability it is from an "alternate" bill book(A very common practice in India). Bottom line is he might be evading paying taxes and hence able to share that extra margin with you.
    Another point to note is the profit margin of FMCG can range from 8% to 45%. Every Category of FMCG has its own range of margin. Generally smaller stores carry only products from one manufacturer in one product segment. For a case study basis, supermarket chains and bigger establishments might carry real, tropicana and some imported packed juices, while smaller stores only purchase real or tropicana. Now how he chooses between real and tropicana is not by quality or demand but buy if he his selling dabur or pepsico items. Hence his entire catalog of stock only comes esstentially from 4-5 manufacturers and essentially from probably 10 dealers. For a supermarket, they carry good stock of wide catalogs ( essentially more SKUs), their overall percentage on branded goods is much much lesser than the overall margin of a smaller store. This is why most supermarkets also sell their own products to compensate for the difference in overall margin. Please note that most of the supermarkets in Chennai procure from George Town Wholesalers, pack them and sell them, just because they are big retail chains does not necessarily mean they are higher up the supply chain( Exceptions : brands like Reliance).

    Another factor is also to look into is the fact if the margin of 10% cheaper is more or less consistent in all his stock categories.

    If Jeyachandran stores is selling the goods clean as in without evading taxes, then kudos for the price point he is maintaining.

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  7. boss... appo Jayachandran provisional needs ku okay... any other shop .. plz name them too...

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  8. boss... appo Jayachandran provisional needs ku okay... any other shop .. plz name them too...

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