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Asian Tribune is published by World Institute For Asian Studies|Powered by WIAS Vol. 12 No. 2730

Some relief in airconditioned comfort

By Chandra Mohan - Syndicate Features

Conventional Indian society disapproves snatching the means of livelihood of one person by another. The more ‘rational’ segments in Indian society, Marxists in particular, view the same act as an exploitation of the lesser privileged. It will, therefore, be considered politically unacceptable to defend the eruption of retain chains because they apparently edge out the traditional corner grocery shops and small-time hawkers and vendors who have served the consumer for a long time.

The Marxists have made loud noises against the entry of big US retail chains like Wal-Mart because they see it as a prelude to a hated foreign power ‘invading’ the country through the 21st century version of East India Company (EIC). Most political parties that happen to be in opposition share the Marxist paranoia of ‘foreign power domination’ in denouncing the ‘backdoor’ entry of EIC recalling how that company had eventually led to British rule over ‘Akhand Bharat’, that is an India that was much bigger than it is today.

Recent reports suggest that the brunt of political anger has been borne by the chain of Reliance stores in the country selling fruits, vegetables and sundry kitchen items. Quite a few of these stores set up under the brand name, Reliance Fresh, have been vandalised in different parts of the country, though that has deterred the company from executing its plans to open more stores. A bigger chain, run by R. Subramanian, an IIT-IIM graduate, called Subhiksha (prosperity) has been in business since 1997. Starting from Chennai, today it has 500 outlets in the country and by the end of the year the number is likely to double.

Since the chain stores have now attracted big companies like Reliance one presumes that they took the plunge in a new line of business after considering all the pros and cons and studying what the consumer expects from them. But perhaps some of the trouble these chains are facing from politically-backed agitation could have been avoided if the rich and powerful men and companies behind the retail chain trade had prepared plans for rehabilitating the likely ‘victims’ of their venture.

That the opening of retail chains by ‘big business’ or devilish ‘foreign powers’ does deprive some people of a means of livelihood cannot be denied. It militates against the propagation of self-employment and discourages individual enterprise, which has otherwise played no small role in accelerating the pace of our economy.

At the same time it cannot also be denied that there is a less disagreeable angle to the advent of retail chains selling things like fruits and vegetables in air-conditioned halls. It is a matter of economics, looking for better bargains. A large number—perhaps the majority of population--is unconcerned about Marxist opposition to the invasion by ‘big business’ or ‘foreign powers’, and does not believe that India can be enslaved by the new set of grocers and shopkeepers no matter how affluent and powerful they might be.

Proof lies in the crowds that throng these retail stores, though it is not unusual to hear some grumbling noises in the melee about the quality and price of commodities on sale. But that is certainly not the overwhelming refrain, or else the chain stores would have been making a hasty exit instead of planning more branches. It is not necessary to expect identical response when a variety of consumer durables and vegetables are on sale.

The overriding concern of the ‘ordinary’ consumer, who may not be part of the ‘shining’ brigade and is decidedly cost-conscious, is the price he or she pays for purchasing everyday items. A customer will and does flock to a retail store where the price of vegetables and fruits can be 30 or 40 percent less than the price at the vegetable market in the neighbourhood or even at the wayside vegetable stall. It is not just the price that is attractive; the more careful customer will find that there is a difference in quantity too—the scales at the vegetable market weigh less.

The big retail chain owners say that they are not in the business of depriving the street vegetable and fruit vendor of his means of livelihood. They maintain that in most residential districts of an average-size city there is scope for both the chains and the street vendor to do business, though the share of the street vendor might fall as competition grows.

A distinction needs to be drawn between the street vendor and the regular vegetable and fruit shopkeeper. It is the mobile vendor who seems to be under greater threat than the regular shopkeeper who can manipulate prices more easily and can retain hold over a clientele by offering more variety or responding to individual requests or tastes for specific items.

While the street hawking vegetable vendors have always struggled hard to earn a decent income, the shopkeepers have invariably done well for themselves, building physical assets and acquiring comfortable liquidity. They do not hesitate to rock the prices violently, exaggerating even a slight hike in prices at the wholesale market and passing the burden on to the consumer. Strikes, violence, floods, droughts, just about anything are good enough for them to find an excuse for jacking up prices by as much as 100 percent within a matter of 24 hours. The street vendor only follows them.

Nobody can accuse the retail stores of being in business for altruistic reasons. Profit is certainly a prime motive and drive. But one can tell from personal experience that frequent and wild price fluctuations are not common at the neighbourhood vegetable stalls.

Asked about the high price of vegetable at his outlet, one shopkeeper denied the charge but added that he cannot stay in business without greasing a number of palms. A random survey might show that quite a few of individual shops are ‘illegal’, though their business is not big enough to attract municipality bulldozers. But trouble from the civic authorities and the police is rather regular. And every shopkeeper sets aside some cash to take care of these ‘daily exigencies’.

Bribery having taken deep roots in the country it is quite likely that even the chain stores have to pay to corrupt officials to carry out business without any hassles. Such expenditure if any is probably met from the overhead costs of doing business and does not affect the price of goods on a daily basis. The burden is not automatically passed on to the consumer. Some relief in air conditioned comfort!

- Syndicate Features -

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