Navigating Effective Retail ExpansionZainab Khan
Where the retail industry is experiencing supersizing, there are a number of factors that act as an obstacle in retail expansion. Be it related to technology acquisition or any other things pertinent to the retail sector, there are multi-faceted challenges and obstacles that are needed to be addressed. If the focus is laid on Pakistan’s retail sector, it is obvious that there is a huge communication gap between the retailer and the corporate sector. Since the distributor is the party working as a middleman between them, they hardly get a chance to know the issues faced by the retailers at grass root level along with the fact that they fail to explore retail expansion channels.
Challenges in collecting data:
Retail expansion in any part of the world requires data collection and its thorough analysis. Moreover, it is essential to have sound knowledge about retailers of all levels and how they are functioning in their areas. If you have data of retailers working in the Cantt area and you fail to get accurate data about those operating in Old Lahore, you will fail to make an all-inclusive strategy. Thus, it becomes a great challenge for the corporate sector as well as for retailers. This hinders collaborations between them due to a lack of communication.
Manage a strong, dynamic and active logistics infrastructure:
The logistics infrastructure is of paramount importance in the retail sector. In addition to it, it is a significant part of your growth strategy. This is not a sound strategy for big brands but also for brands dealing in FMCGs. According to the Euromonitor, the size of Pakistani middle-class retail sector is expected to surpass that of developed economies like the UK and Italy during 2016-2021. This sheds light on the immense opportunities that the retail sector has to offer but this paves way for better understanding of logistics infrastructure. As a matter of fact, having dynamic and active logistics infrastructure can facilitate overcoming the supply-related challenges and this can enhance the overall performance of the retail sector. Growing companies must inspect their growth strategy in order to track their progress. Make sure that you are taking all the retailers onboard instead of relying on the distributors only.
Managing the supply chain:
The next important step in this regard is the management of the supply chain. If you planning to expand, you would need a proper supply chain that will facilitate every nook and corner. If you are planning to move beyond the core and touch the peripheries like planning to expand in Narowal and Bhakkar or even Islamabad, you need to ensure that you have a dynamic and active supply chain based on the collected data. Exploring new markets and ensuring effective supply to those areas is very important and is the key to expansion. Having a proper strategy in this regard can help you in having an effective financial and strategic approach. As a matter of fact, companies must take all the retailers on board by approaching them through their representatives.
The exploration of new markets might appear a great challenge but managing logistics and supply chain is what can be termed as the biggest challenge in this regard. This is not enough. Getting feedback from the retailers is a significant component of successful retail expansion.