Thursday, November 24, 2011

The disadvantages of Big Brand retail shops

No, I do not intend to make a socialist case here, which is best left to political parties and activists. Here, I intend to spell the disadvantages that big brand retail shops have for me as a consumer. This is in the back-drop of the Indian government approving 51% foreign direct investment in multi-brand retail or hypermarts, as they are known in the west. This will bring in the big guys like Wal-Mart, Carrefour, etc. The benefits are being touted as big for consumers. They will bring in money, their expertise with supply chain management, etc. to sell goods to consumers at the lowest prices.

But for this, they need infrastructure, which the government would have to provide. Large warehouses would necessitate a smooth supply of electricity, well connected roadways to connect the warehouses to manufacturing centres and the stores, etc. This is woefully missing in India, where outside big cities, a minimum 6-8 hours of load-shedding is considered normal. The success of such retail firms relies big time on the availability of such first class infrastructure. But, whether they succeed or not, they have many disadvantages for consumers.

We may not realise this, but in the quest for selling things at cheaper rates to us, these retail outlets rely more on volumes of business, compared to per unit margins. So, the brand that sells most is the one they will stock. Of course, there are a number of subtle tricks they use to entice us into buying certain brands or products, but then, that is a completely different topic. So, if you like a particular brand and fragrance of incense sticks, you might not find it in the supermarket, because they do not get good volumes on it. And you are stuck to buying from the ones available in the store. So, you tend to lose your favourite brands, if they do not fit in the strategy of the supermarket. The small shopkeeper, though, will keep a fairly diverse number of products. Smaller quantities of the less popular ones may be stocked, but nevertheless, you have a fairly high chance of finding your choice there, than the supermarket.

If a certain product is out-of-stock in the supermarket, you have no way of knowing when it will arrive. The mom-and-pop shopkeeper around the corner, will not only give you an idea of when the product will arrive but also keep it aside for you, once it is in. This personalisation of service is out of question for supermarkets! Their business model just does not have this feature.

Thirdly, the supermarkets stock only big sized products. E.g. shampoos in large bottles, toothpastes are available only in 400 gm. size or detergents in min. 1 kg stocks or buy-3-get-4th-free soaps and many more such things. A very huge number of India's people live on frugal income. For them, to spend Rs. 100 (for a shampoo) in one go is extremely difficult. That is why most of India's FMCG manufacturers have come up with small sized packs (sachets for shampoos, detergents, 50 gm. toothpastes, etc.) which cost very less and are affordable to that population. Such small sizes are not stocked by the supermarkets, as the margin is too low and their rate of sale unpredictable to justify the efforts required to stock them. So, (even if you have a high salaried job but) if you live alone, you won't be able to purchase these things. If staying alone, I wouldn't want to buy a pack of 4 soaps and be stuck with them for 6 odd months. I would rather buy a single cake of soap, which would last for well over a month and be free to choose a different soap every time. Plus, I would be left with liquid cash, free to spend it as I like, instead of being tied up in three soap cakes, which would be useful only after a month.

Such mass stocking of products also hampers the variety available and this is especially visible in the clothing sections. They will not stock premium products. E.g., here in Edmonton, people advise to get winter jackets from special shops, not from Walmart, as it doesn't stock those. These supermarkets won't stock out-of-season stuff too. E.g. no chappals or floaters are available in the supermarkets during winter. For that, you have to look out in the footwear shops only. 

This is a very simplistic analysis of what would happen to us as consumers, if big supermarkets are allowed to dominate the retail business scene. Most of it is my personal experience. In India, there is a certain social aspect associated with shopping, which will not be available in supermarkets. The shopkeeper and the shop is where the local news is exchanged. Moreover, the personal relation developed with the shopkeeper help us in many other ways. His/her network helps us access various other services. E.g., some of his relative or acquaintance might be running a travel agency, from where we would be able to rent a car. Or contract a plumber's services at discounted rates. These informal channels will not be available with supermarkets. Economic and social analyses tend to indicate contrary views, but as a consumer, will we get all that we want? I have my doubts. We might end up getting what the supermarket wants to sell to us and when they want to sell it. As consumers, if we would like to have wider choices, I think supermarkets should not have a free run in the Indian economy.
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Friday, November 11, 2011

How dumb-witted can articles get?

After having spent a wonderful holiday, I was browsing through rediff and came across this news article titled, "Why IAF does NOT need either Eurofighter or Rafale?", written by Ajai Shukla. Apparently, he hasn't listed his credentials while writing this article. Here is what he says and also why that is wrong to a great extent.

He says, Eurofighter and Rafale are in trouble, because they don't have too many orders from their partner customers. The British RAF and German Luftwaffe have scaled down their orders for the Eurofighter. His inference: There's got to be some problem with the Eurofighter. But then, he conveniently forgets that Britain has just introduced massive cuts in its defence budgets and so has Germany done that. The reasons for this are best known to them, but then with budget cuts, one of the things they chopped off, amongst many others, were orders of new fighter aircraft. Same goes for the Rafale, he says, which hasn't a single customer other than the French air force, which too has reduced the number of aircraft ordered. So, to conclude, one reason India shouldn't buy the Eurofigther or Rafale is that they do not have enough customers!!

Next, he says, with China having test-flown the J-20, its first fifth generation aircraft, India would be left with outdated aircraft. And so, he claims that India is wasting money on the Gen-4+ aircraft. Operational clearance for the J-20 is almost 10 years away. Once it receives that, it would be another 5-6 years before squadrons of the J-20 are ready. In the meanwhile, India to is collaborating with Russia. The Sukhoi PAK FA, which is the basis for the Gen-5 fighter has already done three test flights. So, if this project proceeds smoothly, India too can have its won Gen-5 aircraft. In the meanwhile, we need to replace the aging MIG 21s.

Third, he says, Japan, South Korea and Singapore are investing in the F-35, which is a Gen-5 air craft manufactured by Lockheed Martin. He says that Lockheed Martin and the US government have signalled that clearances for selling the F-35 would be granted expeditiously. But then, how wise is it to depend on the US for our air craft? Particularly, when it is known that the US does not allow complete transfer of technology and also ends up keeping crucial technology information with itself. This would mean that we would be tied to the whims and fancies of the US, once the contracts have been signed. And if the US Congress or Senate passes a bill restricting the transfer of crucial technology to F-35 in the Indian Air Force, where are we supposed to go?

To draw conclusions, this gentleman says that India shouldn't be purchasing the Eurofighter or Rafale for the following reasons:
  1. The Eurofighter and Rafale haven't attracted enough customers. Doesn't matter if the Eurofighter has 5 customers currently on its role. Rafale, unfortunately has only the French Air Force as its customer.
  2. Since China has tested a FGFA, we shouldn't order Gen-4+ aircraft. Never mind that we have a FGFA programme going on with Russia, which should show some results by 2017. 
  3. Since the US government has indicated that the F-35 sale to India would be expeditiously cleared, we should go for it. And since Japan, South Korea and Singapore are also investing in the F-35 we should buy it from the US. Never mind, the US habbit of keeping a tight leash on crucial technology and never committing to full technology transfer.
Could articles relating to crucial matters such as the country's defence have so shallow reasoning? And could they get dumber than this?
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Wednesday, November 02, 2011

Team Anna has to be like Caesar's wife

 That the government would strike back at Team Anna members was a forgone conclusion when the anti-corruption movement gathered steam. And especially after Anna Hazare's super successful fast in Delhi. The government, and especially the Congress, feels embarrassed and lame as a perception was built that Team Anna brought the government to its knees and that without them, the government would have never passed a strong Lokpal bill.

Moreover, Anna Hazare and his team members were trying to take every opportunity to strike at the government. With the people supporting them and having created a favourable environment for themselves, Team Anna had tasted its success in the limelight. The Congress had to do something about it and show them, who's the boss. The Congress had a perception that it was cornered. And it decided to strike back with every weapon possible. Remember the Hindi idiom डूबते हुए को तिनके का सहारा. 

The first target was Anna Hazare himself. Digvijay Singh, who is inflicted by a perpetual foot-in-the-mouth disease constantly tried to prove that the anti-corruption movement is nothing but a front for the Rashtriya Swayamsevak Sangh (RSS). And he used very lame evidences, such as RSS chief's letter of support to justify his statements. However, the people are reluctant to believe this. Even if RSS was with Anna Hazare on the issue of corruption, people will not mind because they are heavily affected by corruption and would want to see it finished once and for all.

The second case, which was presented was against Arvind Kejriwal. The RTI activist had applied for voluntary retirement from his services and perhaps left the job. The IT department, which was his former employer, refused to accept his application on account of some bond being broken by Kejriwal. The question is, why did the IT department take so long to give its decision. Moreover, how was Kejriwal  so careless in not realising that he hadn't fulfilled the conditions for retirement? After that, he first made a statement that he had not broken any bond. Then, after a few days, he said he will take a loan from a friend to repay the claims made by his department so that he can be released from service. These flip-flops strengthen the notion that he indeed was involved in procedural lapses and his employer was correct in dismissing his application.

And Kiran Bedi takes the cake of all. This was with evidence. She claimed business class air-fare for travelling to deliver talks, while she actually travelled economy class, whose fare too was discounted for her as she was a gallantry medal winner. If she had requested her hosts (some of which were NGOs) to pay her business class fare and she would divert the excess amount to the NGO, then it would have been completely acceptable. After all, the hosts had a choice in saying whether their money should be used in such a manner. Moreover, she could have requested the hosts to give the excess fare as donation to her NGO, which would have also resulted in further tax benefit for the hosts. But by not doing this, she has damaged her credibility to a certain extent. Although she says, there was no mala fide intent in claiming excess fare, as it was her entitlement, she is not supposed to submit false bills to claim the fare. Remember, those NGOs are many times funded by the government, through taxpayers' money and also through donations that individuals make out of their hard earned money. Bedi has no right to claim that money through submission of inflated bills.

Reputation is like glassware. One crack and it is almost impossible to restore it. Integrity of the character is what made the people of India place their faith in Team Anna. Moreover, the media has placed them on a high pedestal, which the people view as worthy for only those with an impeccable character. Team Anna, therefore, has to be like Caesar's wife- above suspicion. Caesar divorced his wife, Pompeia, just because she was suspected of having an affair with Clodius. He did this to indicate that only a woman who is above any kind of suspicion is fit to be his wife. Will Anna Hazare become Julius Caesar? Strong character itself can earn you a place in history.
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Sunday, October 16, 2011

Lettuce-strawberry salad

Strawberry-lettuce salad
Okay, at the outset, I am not going to be posting any recipes regularly. I'm not a very enthusiastic cook, but kya karein, paapi pet ka sawal hai!

So, I had this strong urge of eating a salad, but didn't know how to prepare one with lettuce. And then, I decided to improvise. Now, since I wanted it to be a healthy salad, this meant no dressings, no oil and sugar. And I do not like the taste of plain lettuce.

So, I dug into my refrigerator and found a box of Californian strawberries lying there. I pulled out the strawberry box and curd and decided to try out something. The final result is on your side. So, here goes the recipe:

Lettuce-strawberry salad
Serves: 1 voracious salad eater like me, 2 timid ones

Ingredients:
Lettuce leaves: 4-5
Strawberries: 6
Curd: As per your desire (preferred quantity: 4 serving spoon size)
Salt: to taste (as usual)
Pepper powder: to taste (again, as usual)

Preparation:
  1. Wash the lettuce leaves thoroughly and chop them into small pieces.
  2. Wash the strawberries and slice them into medium sized pieces. If sliced too small, they might get squashed when you mix the salad.
  3. Take the lettuce leaves in a salad bowl and add the curd to into it. You may add a little water to loosen up the curd. Mix the curd and lettuce leaves thoroughly.
  4. Now, add the sliced strawberries and gently mix the salad. Be sure to do it gently, as you might end up squashing the strawberries under the load of the lettuce leaves and curd.
  5. Finally, just before serving add salt and pepper. This is to avoid all the water draining out due to addition of salt.

And ta-da!! The salad is ready to be devoured!

Note: You can definitely try any other fruit or combination of fruits.
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Saturday, October 08, 2011

What is wrong with IIT students?

In a country where something or the other is constantly happening to keep the breaking news ticker of the news channels running, there is a new storm in the tea cup. The co-founder of Infosys, Narayana Murthy, made a statement that the quality of students entering the IITs has deteriorated over the years, courtesy coaching classes. And then, some how channels caught hold of Chetan Bhagat, the 'youth icon' who bid good-bye to an engineering career, took up a investment banking job and  left that one too, to write famous books and be called a literary sensation, countered(?) saying that those who run body shops shouldn't comment on quality of engineers. Bhagat further states that the system should be fixed, no use blaming the students.

So, who is right or wrong? Well, Mr. Murthy's comments need to be looked in their context. And nobody is ready to do that. Yes, coaching classes have spawned all over the country where students are imparted training on how to approach the JEE. Most of the students end  up practising hundreds of problems, of which some similar ones are bound to appear in the exam, thereby increasing the chances of them answering these questions correctly. Nothing wrong in this, as long as the students have some passion to pursue a technical career. Many a times, aspirants are told by their parents- beta/beti, 2 saal man laga kar padho, ek bar IIT mein admission mil gayi, to zindagi ban jayegi. Admissions to the IIT are made to appear like the Holy Grail, on which only the blessed ones may be able to lay their hands on. Now, when bombarded with such advice, students generally slog hard to get to the holy grail. But, no one prepares them for the life in IITs. The coaching classes hardly advise the students on life at IIT, their jobs end once the students clear JEE.

Of course, IITs too haven't been very active in keeping up the students' enthusiasm. Professors and Ph.D. students at IIT should be involved in motivating the students to take interest in a technical career. No one seems to tell them that though you might end up using a certain percentage of the technical knowledge gained, it is necessary to understand the whole picture. This would also help when you rise in your career and would be involved more in managerial decisions rather than technical details. Any problem given to them is to be analysed using the mathematical skills learnt over the past years. But, provide them with challenges. Make them realise that all problems do not have pre-set answers. Let them use their engineering knowledge to build solutions to realistic problems. This will definitely improve their understanding about the problem and how to approach its solutions.

And at some stage, we need to stop glorifying people like Steve Jobs, Bill Gates and many more such persons. We always keep on saying Jobs and Gates were college drop-outs, yet they achieved so much in life. They might have not seen the face of IIT, but have the potential of employing so many IITians. Well, both Jobs and Gates spent hundreds and thousands of hours working on and sharpening their skills of design and coding. Moreover, a very few have the talent of becoming a Jobs or a Gates. In the tech. industry too, how many have risen to the stature of Gates or Jobs? The rest have to live with the fact that there are limits in their talent. It is, therefore up to the existing students to increase focus on giving an exposure to the students on the benefits of a technical career. At IITB, I have seen students calling many alumni to talk about their lives. Most of these people are non-tech people. Those who are entrepreneurs or in the finance sector or have taken a management degree are invited to talk. But the likes of Kota Harinarayana, who led the Light Combat Aircraft (LCA) project, do not get invited. Same with people from the Chandrayan project or any of the DRDO projects.

Faculty should use their network with the industry and other research laboratories and organise sessions on the benefits of a technical career. There have been many technical successes in India. These need to be marketed to the students, similar to the way Jobs used to market his products. Faculty should see this as a part of their work, so that students realise what they are gaining from the technical knowledge they gain at IIT.

And finally, the industry in India should be able to absorb this technical talent. When Mr. Murthy talks about quality deficit in IITians, people are definitely going to ask, what has Infosys done for this country? Apart from providing jobs to millions of people (directly and indirectly), there is nothing noteworthy to be said of them. Providing localisation of content, or IT services for solving problems faced in India or innovative IT products, where are the companies that would be doing this? Going beyond IT, how are the engineering companies doing? How much are they spending on R&D? And where is this R&D being directed towards? To solve big ticket problems that worry the West or to innovate for the benefit of the Indian society? If we are able to find answers to these questions, then we would definitely be able to bring out more from IIT students and Mr. Murthy wouldn't have to make his comment any more. That would also keep Chetan Bhagat in check.
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