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No matter what happens but still Grocery Sells! Any economic down turn, lockdown, agitation, natural calamity cannot stop the sale of Grocery.
Grocery is the basic need of people, and they need it daily. This translates into daily demand, unlike other durables like TV, mobile etc, grocery is bought on a regular basis. This nature of this segment makes it a lucrative business. This attracts a large number of individuals and companies to this segment, thereby making it a business which is known for its cut throat competition.
For getting started with a new business, there are some basic things that needs to be arranged first, below is the list of most necessary things to arrange before starting a new grocery store:
1) A Store: To start a grocery store, we need a place. This should not be on rent, because as mentioned earlier this business has excessive competition so rent would be an additional burden. It would be like running a marathon while carrying fifty kg extra weight. The location of this store should be where there are residential areas nearby and not many grocery stores around. The store should have good parking space, so that customers can come in their cars to do shopping.
2) Fixtures & Manpower: Any morden store has beautiful racks for showcasing the products, so it's important that we pay due attention to this. Also we would need a billing counter, cameras, chairs behind the billing counter, trolley and buckets for customers to pick products. We need a billing software to issue bills and maintain stock. And then we need people to do things. Employee can be a deciding factor in the success of a store, they need to be sincere, well trained in customer handling.
3) GST Registration and FSSAI Licence: We would need a GST number, this can be obtained online on your own or a CA can help to obtain one. Sometimes people say that is it necessary to obtain FSSAI Licence, the answer is, if we are dealing in any edible products in any manner, than we cannot be doing such business without FSSAI Licence. This can be obtained by visiting the FSSAI office or an advocate can help in obtaining a licence for you. FSSAI Licence has Rs 2000 per year licence fees and the advocate fee will be extra.
4) Suppliers:This is very important aspect, as we need goods to sell and these are provided by distributors, Traders, Vendors etc. Distributors in a city generally have an association, so meeting with the association of distributors can help in finding the distributors for all the required products. There are many items which comes loose, and they needs to be bought from mandis, Traders etc. Here minimum order quantity prevails, so we need to buy in bulk, store it, pack it and then sell. Once the store starts to run, suppliers tend to come on their own also.
5) Marketing: This is a very important aspect and anyone opening a new store must keep a budget aside for this. There can be an inaugural scheme to bring customers to the store for the first time and if they like the products they will come back again. Also at regular intervals we would need to work out schemes so that our sales keep on growing. There are yearly deals on newspapers, here they offer a lower rate of advertisement on a commitment of a certain ad space.
6) Institutional Sales: Restaurant, Hotels, wedding halls, hostels etc have a regular demand, so connecting with them can bring good sales. Just that there is competition here and some institutions give payment very late, this can be a problem.
7) Investment:All the above needs money. And depending upon the scale of the store we need to make a list of total investment required. There are banks who can provide loans, however it would add up to the costs of selling and it's always better to have one's own funds.
8) Replenishment of Inventory: A grocery stores can have over a thousand SKUs. This replenishment of inventory will be a daily task. Our job is to to ensure that nothing goes out of stock at any time in the store. This needs planning as there are lead time of procuring the product, and we need to plan the inventory levels in such a manner that neither the inventory stays with us for long nor it goes out of stock.
9) Expiring or Dead Stock: Many companies have policy of taking the expired stock back but some don't. Therefore it's very important to identify the potential expiring stock and display it at a position where they move quickly. Even if a company takes back the expired stock it will still cause a loss in terms of taxes.
10) Accounting:This is a very important aspect of any business. There will be credit purchase, credit sales, salary to employees, other expenses. All these needs proper accounting. We need to ensure that we don't pay the same bill more than once. Also we need to ensure that the credit sales are recovered well in time.
11) Increasing Variety:When a store is running a score of sellers would be approaching for selling their products. If we keep on adding all these products we will soon have an uncontrollable range, out of which many products would be just occupying shelf space and not moving at all. Thus before we say yes to any new product, we have to give a thought they whether it will sell or not.
Overall it's an engaging business, and would need a large part of your time. Customers tend to buy from a store where they find the owner. Moreover relationship with customers can be very helpful in finding out your shortcomings and need of the customer.
