Apna Bazaar

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Consumer Co-operative Societies

Consumers are unorganized and therefore exploited by traders in price, quality and
weight. Consumer co-operatives protects the interests of consumers against artificial
scarcity, over charging of prices, supply of sub standard goods and the unfair trade
practices distorted by private traders.

Definition:

Maharashtra Co-operative Societies Act, 1960, defines consumer co-operative society as

a society, the object of which is:

• The procurement, production or processing and the distribution of goods to or, the
performance of other services for its members as also other consumers,

• The distribution among its members and customers, of the profit occurring from such
procurement, production, processing and distribution are in proportion as prescribed
by rules or bye-laws of the society.

A consumer co-operative society is basically formed for the promotion of the interests of
the consumers.

Composition of consumer co-operative societies:

National Co-operative Consumers’ Federation (1)

State Co-operative Consumers’ Federation (28)

Wholesale / Central Stores (681)

Departmental Stores (Apna Bazaar)

Primary Consumer Co-operative Stores (26469)

Consumers’ Stores Consumers’ Stores University &

for Rural of Industrial College
Population Workers Consumers’ Stores

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Objectives of consumer co-operatives:

• To educate the consumers to keep their needs within the income limit.
• Stabilization of market rates.
• To supply the goods and services regularly at reasonable costs.
• To protect the consumers from black marketing, increase in market rates, scarcity,
cheating and adulteration.
• To supply proper unadulterated goods and to use proper measurement (weighing
scales).
• To inculcate the habit of savings and economy among the consumers.
• To control the profit-making tendency

Need and importance of consumer co-operatives:

• Supply of things and services as per needs-

The consumer co-operative societies are formed to satisfy the needs goods and services
as demanded by the consumers. There are directly contracts with producers and
manufacturers of things and required goods are purchased directly from them, thereby the
consumers can be supplied with the goods as demanded.

• Eradication of malpractices of traders-

It is found that there are many malpractices in trading like black marketing, artificial
scarcity, cheating in measurements, hoarding, etc. proper measurements are not used
whereby the consumer becomes ultimate victim of all these malpractices by the traders.
There is no place for all these things in co-operative consumer societies and so the
consumers are attracted towards them.

• Necessity of time:
India has adopted financial planning and there is importance for public distribution of
essentialities of life. The consumer co-operative societies help the government in
distributing these essentialities to rural and urban areas of our country. These societies
have become very important day by day. Since these societies have been entrusted the job
distribution, the consumers are saved from financial exploitation and hardship.

• Establishment of proper trading system:

The consumer co-operative societies supply good quality of things at reasonable cost by
using right measurement and pure things. Hence from the viewpoint of customers these
societies are very important.

• Eradication of trader’s chain:

There is long chain in between the producers and consumers. The things are sold at
higher cost to consumers because the middlemen add their own profit and expenses. The
consumer co-operative societies directly purchase the goods from the producers and
chain of middleman can be avoided.

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Apna Bazaar
Apna Bazaar is probably the oldest and largest consumer co-operative multi-state society
with a customer base of over 12 lakhs. The Rs 140-crore retail chain, that, for over 55
years remained largely “middle-class”, Apna Bazaar has 80 outlets in Mumbai, Thane
and the neighbouring Konkan region. It has recently opened its first shop outside the state
in Goa. It recorded a turnover of Rs 127 crore for the year 2003-04.

Apna Bazar, the synonym for the basic needs,

Brand name of Mumbai Kamgar Madhyavarti

Grahak Sahakari Mandal Ltd

Date of Incorporation 9th May 1948

Constitution Multi State Co-operative Society
Sector Private
Industry Retailing
Registered Office 106-A, Govingi Keni Road,
Naigaon, Dadar [East], Mumbai
400014

Role of Apna Bazaar:

Apna bazaar plays a vital role by market intervention during the shortagis of essential
commodities. The distribution of these items is taken up by the Apna Bazaar at a loss to
fulfill its social commitments. At times of need, Apna Bazaar has diverted its manpower
and resources, even at the cost of its own commercial interest, for the public good.

Objectives of Apna Bazaar:

• To undertake wholesale and retail distribution of consumer goods and essential

commodities; and to establish department stores;
• To foster the growth products and new manufacturing units through market support
and management advice
• To lower distribution costs and to introduce fair and better trading practices such as
fixed prices etc; and
• Eradication of malpractices of traders black marketing, artificial scarcity, cheating in
measurements, adulteration, etc.
• Necessity of time – public distribution of essential commodities in rural and urban
areas.
• Elimination of middlemen.

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Management and Organization:

Apna Bazaar is headed by a management team comprising a chairman, vice chairman and
Hon secretaries. The team largely provides direction to the organization and is not
involved in the day-to-day affairs. The day-to-day affairs are managed by an executive
team, which consists of a general manager, additional general manager and office bearers
of the organization.

Outlet

Apna Bazaar has a customer base of over 12 lakhs. Apna Bazaar has 80 outlets in
Mumbai, Thane and the neighbouring Konkan region. It has recently opened its first shop
outside the state in Goa.The break up of the stores is:

Departmental stores 8
Medical stores 4
Supermarkets 7
Franchisee stores 37
Food stores 24

Items Sold By Apna Bazaar

Apna Bazaar has the following three main categories of items:

a. Agro products
b. Branded products
c. Rural products
Apna Bazaar sells an immense variety of items through its various departments/retail
outlets. These are described below: -

• Furniture:
All type of wooden furniture, steel furniture library furniture, hospital furniture, revolving
chairs, computer furniture, mattresses, pillows, sofa cushion.

• Household:
Steel utensils, aluminum utensils, non stock, gas stoves, locks, mixer-grinder, juice-cum-
mixer grinder, hot-cases, room heater, room convector, geysers, all type of fans, electrical
goods, washing machine, air-conditioners, water cooler, voltage stabilizer, generator set,
crockery, flasks, plastic items, electrical bulb/tubes and tube fittings, table lamp,
emergency light, cell, torch, electric wire, desert cooler, exhaust fans.

• Footwear:
Shoes, sandals, ladies purse, belt, umbrella, school, bag, suit cases, brief cases, file box,
file bag, luggage bag.

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• Textile:
Woolen suiting, tericot suiting and shirting, blanket, blazer, bed-sheets, pillow cover,
dress material, all types of sarees, markein cloth, long cloth, voil, mulmul khadi etc.

• Handloom:
Towels, dusters, curtain cloth, bed-covers, carpets, quilt, durries, jute matting, blankets,
pillow covers, door-mats, PVC flooring.

• Ready Made Garments:

Pants, shirts, undergarments, socks, sweaters, leather jackets, ladies suits, petticoats,
children garments, rain coats, over-coats, mosquito mat, curtain tapes, machine oil,
raxine.

• Stationery:
All types of duplicating, typing, photocopies paper, printing paper, all types of rules
registers in different sizes peon books, dak pads, pens, pencils, pen stands, eraser,
markers, sign pens, gum-bottles scales, colours, art material, sealing wax, white fluid,
sutle, stencil and carbon paper, all type of computer stationery, butter paper, crepe paper,
glaze paper, graph paper, file covers, log books, all type of printed forms (Govt. offices),
PVC sheet for binding purposes, transparency sheets, ledgers, cash books calculators,
computer floppy, fax roll, typewriting ribbon, ammonia paper rolls.

• Watches:
Watches of reputed companies like Titan.

• Grocery & Toiletries:

Pulses, spices, atta, rice, oils, tea leaves, and various other edible items, insecticides,
disinfectants, phenyle, detergents, soaps, cosmetics, tissue rolls and napkins etc.

• Medical & Surgical Equipment:

All types of medicines, medical & surgical equipment etc.

Members Benefits:

• Dividend on shares at 12% to individuals, society and government.

• Purchase rebate on share amount 10% each year.
• Attractive rate of interest up to 9% on fixed deposit by the members.

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Facilities Offered By Apna Bazaar to Consumers:

Apna Bazaar provides the following facilities to consumers: -

• Quality products at reasonable prices.
• Variety of items under one roof.
• 24 hours drugs outlets.
• Self-service counters
• Items of high quality tested by its quality- testing laboratory.
• Display boards and price lists at various counters to enable the customer to make
his/her choice.
• Home delivery, but this facility is only available for purchase from branches.
• Discount sales periodically on various items

Location:

The location for the store is selected taking in consideration the residential population in
the area, the standard of living of the people, the amount of business the other shops are
doing and also future development that are likely to take place in that area in future.

Area covered:

Apna Bazaar has 80 outlets in Mumbai, Thane and the neighbouring Konkan region. It
has recently opened its first shop outside the state in Goa. However the density of Apna
Bazaar is high in Naigoan and Chembur

Space required:

The minimum requirement of area for setting up Apna Bazaar is1000 sq.feet. The biggest
store is at Vashi, which is spread across 27000 sq.feet.

Target segments:

The store was started keeping in mind the lower middle class section of the society. But
gradually it has moved up the consumer ladder with the inclusion of the middle class as
its target consumer. Now slowly it is drawing the upper class towards it. It now caters to
almost all the segments of the society depending on the location. In order to attract the
upper class & to combat growing competition in the retail industry it is making changes
in its product-mix.

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Change in product Mix:

Commodity Tones (2002-03) Tones (2003-04)

Rice 1420 1325
Wheat 1070 1050
Dal 1410 1360
Pulses 800 785
The above table indicates decline in the sales of Rice, Wheat, Pulses etc which shows the
change in the food culture/consumption pattern of the consumer. It indicates that the
consumer’s inclination towards ready-to-eat food is increasing. Taking this into
consideration Apna Bazaar had made has made appropriate changes in its Product Mix.
Slowly the Percentage of food grains, pulses has declined and that of FMCG products has
increased. In a couple of years the percentage of poultry products in the product mix
would increase whereas that of food grains pluses etc. would decline. This would further
change the product –mix of Apna Bazaar.

Store Layout:

Layout of shop Apna Bazaar does not have any specific layout of shop. But in most of
outlet the 1st division you would come out is Vegetable, Fruit, Medical product, food
grains, and FMCG product. The only think that is kept under consideration that Heavy
Product like 5kg. Sugar, 10kg. Wheat, 5 ltr. Oil is near cash counter for convenience of
customer. In case of display they see to it that display at entrance is very colorful &
attractive. Hence they display cosmetics & FMCG product. Besides product, which is
new to the market, are also displayed to grab attention of consumer

Product Display:

The brands are displayed in a very attractive manner .The decision to place a Brand on a
particular shall depends upon the Market share enjoyed by the company /Brand. Usually
there are 5 Shelves. Out of which 2nd, 3rd & 4th shelves are most important ones on which
the brand with high market share or high brand equity are placed. These products are
always in demand by the customers.

Footfalls:

In big stores, like the departmental store at Andheri, there are 2000 to 3000 footfalls in a
day (on weekdays) & on weekends there are around 3000 to 3500 footfalls. In small
outlets there are around 100 footfalls on regular day’s .On weekends there are 200 to 250
footfalls. The footfalls are more especially on Sunday.

The footfalls are more in evening between 6.30pm. & 8.30pm .Whereas the footfalls are
comparatively low during the afternoon slot of 1.30-3.30 pm. Keeping this in mind stores
are closed down during this time. In this time the staff are rearrange the merchandise in
the store.

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Sources of Income:

• Retailing is their core activity and a major part of their income come from the various
retail outlets.
• They supply commodities like Dal, Pulses, Food grains, Cereals to Govt. Institutions,
Hospitals for their Canteens. A 30 Days credit is given to them.
• They also earn income from the company racks that they display in their outlets.
These racks contain the products of the particular company and the in turn pays Apna
Bazaar for displaying these racks. E.g. Maggie, Colgate, Pepsodent, Vicks, Nescafe
etc.
• They provide space to companies e.g. MEPL (Electronic goods) in order to display
and sell their goods by charging rent for space provided.
• They have 37 Franchise outlets, which act as a source of income for Apna Bazaar as
Apna Bazaar supplies 70% of goods.
• Provide place to banks for opening ATM center by charging rent since almost all the
outlets are owned by Apna bazaar.
• MetLife India signed an agreement with Apna Bazaar Co-operative for selling life
insurance policies. Based on the agreement, Apna Bazaar Co-operative shall become
corporate agents for MetLife India and offer MetLife India products to its huge
customer base. Henceforth Apna Bazaar will enable its customers to build financial
freedom through MetLife India products based on need analysis. Apna Bazaar will
receive a commission of 35% on Premium amount.

Exports:

'Apna Bazaar ' is a 55 year old co-operative organization with US $ 37 million annual
turnover through 07 departmental stores, 06 super markets & 65 retail outlets.

Apna bazaar used to export commodities like fish and grapes to Europe. In spite of good
earnings on exports they have discontinued the exports from this year .Thus the reasons
for the discontinuation were due to:

• The goods were seasonal in nature.

• In case of grapes the Jalgoan region in which grapes where cultivated was hit by
drought, thereby by affecting the production of grapes.
• Besides the grapes were sprayed with certain chemicals which were banned in the
European countries, thereby further affecting the exports.
• Besides exports is not Apna Bazaar’s core activity therefore the decision to
discontinue exports was taken.

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SWOT Analysis:

Strengths:

• Goodwill-
Apna Bazaar has built its image over the years as a value for money store, which supplies
good quality goods at economical price.

• Number of Outlets-
Apna Bazaar has 80 outlets spread all over Mumbai, Navi Mumbai, Thane and the
neighbouring Konkan region, Lanza (Bombay-Goa road), among other places in
Maharashtra. All these areas are easily accessible as public transportation is available.
Hence providing easy accessibility to the customers.

• Team work-
Although there is no training imparted to the employees at the outlets, there is co-
ordination and understanding between them due to which the work goes on smoothly
creating a win-win situation for both, the management and the employees.

• Modernization-
Apna Bazaar makes use of modern technology to maintain correct supplier bills and
giving accurate bills to customers giving details of each purchase and most importantly
showing him the savings he has made while purchasing from Apna Bazaar. They also
possess total details of their sales and the percentage of sales in each category so they
know where the sales are high and where they are lagging behind.

• Genuine Products-
The products of Apna Bazaar are genuine as they purchase it directly from the
companies. Lots of imitations of consumables such as honey, oil, etc. are available in
many stores. People get cheated, as it is not easy to identify them.

• CRM-
Apna Bazaar organizes a customer meet for their regular customers called MELAVDA at
their anniversary to build stronger relations with their customers. On this day, the
customers are offered purchase discounts which show that they have taken corrective
steps towards customer satisfaction.

Weaknesses

• Capital-
Raising capital for expansion and improvement is also a constraint. Apna Bazaar is
bounded by the laws of consumer co-operatives due to which they cannot raise funds
from open market. There is also limit prescribed by the consumer co-operatives for
number of shares issued by Apna Bazaar. This is a major drawback for Apna Bazaar.

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• Ageing society-
Apna Bazar started after World War 2 when there was need of essential commodities at
lower prices. But, after liberalization many super markets and hypermarkets have opened
up due to which there is explosion of choices. Moreover, people today have the money to
go for convenience shopping, and hence, the purpose for opening the co-operative is
defeated.

• Obstacles in recruitment: -
Apna Bazar does not have the budget to recruit skilled staff. The employees are not well
educated and hence, they are not aware of the management practices. A qualified
employee demands higher salary, which cannot be given by Apna Bazaar due to their
constraints. Hence they cannot appoint a MBA a managerial job.

• No online retailing: -
Apna Bazar does not have information about its products online. They should have their
own website as it is very important in today’s world. They could even learn about
customer grievances by the feedback.

• Price fluctuation: -
Price Fluctuation is a major threat to Apna Bazar. If the product is bought at a higher
price is has to be sold at that price only so as not to incur losses. For example, the price of
oil fluctuates a lot. So if the price for oil is Rs. 820 for a can when it is purchased, it will
be sold at Rs 820 per can even if the price falls to Rs. 800 per can. In this case the oil
available from other shops will be cheaper.

Opportunities

• Brand building: -
Apna Bazaar can take efforts to build its’ brand image. For this purpose, a marketing firm
can he hired. This will attract more and more people to its outlets. Also, they have
upgraded their outlets. This can be the base for attracting more customers as they will
soon have all air conditioned stores.

• Expansion: -
Apna Bazaar can expand its outlets to other states. At present, they have discovered
interests from Madhya Pradesh and Delhi. The initiation is on the anvil.

• Development in suburbs: -
People are now moving in the suburbs; infrastructure is developing due to which there is
huge potential to attract more customers.

• Retailing boom:
Retailing today is not only about selling at the shop, but also about surveying the market,
offering choice and experience to consumers, competitive prices and retaining consumers

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as well. The establishment of supermarkets and convenience stores has been a great effort
to communicate the advantages of organized retailing to customers.

Threats:

• Malls-
There are a large number of malls that offer discounts the discounts offered by them are
as good as those offered by Apna Bazaar because the malls purchase in bulk and can
hence afford to give heavy discounts to the customers. The customer has an explosion of
choices and will prefer shopping at these big malls because of the ambience. They get the
complete shopping experience at malls. Hence, malls are a major threat for Apna Bazaar.

• Competition from other stores in terms of-

Customer Centric Approach:

Most other stores take feedback from the customers in form of grievances, opinions and
suggestions. They can find out customer needs and ways to satisfy them.

Image:
Image of a private retailer is more modern and advanced compared to that of Apna
Bazaar. The display is also more attractive in other super markets and hypermarkets
compared to Apna Bazaar.

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Future Plans:

• Apna Bazaar plans to open outlets in the new housing colonies coming up in the
interior suburbs like Kandivli and Thane.

• Increasing the distribution reach is a strategy to counter competition the co-operative

plans to increase its outlets from 80 at present to about 100 by next year. This would
comprise department stores, super markets, franchisee outlets and medical stores,
both in Maharashtra as well as rest of the country.

• Apart from that, it has money transfer facility under an arrangement with Western
Union money transfer.

• On the tie-up with HPCL for having Apna Bazaar outlets at the petrol pumps, so far
three HPCL pumps have Apna Bazaar outlets and the results are still being analyzed.

• Apna Bazaar Co-operative has embarked on a restructuring exercise and has

appointed Darashaw and Company as strategic consultants. The restructuring
involves exiting certain business while adding more services, to be provided under its
umbrella. The restructuring plan involves exiting out of businesses like export of fish
and grapes, milk processing, manufacturing bakery products like biscuits and also
pickles papads and spices.

• Online booking for provisions through the Net and a centralized system to control
inventory are also on the anvil. To begin with the co-operative plans to have a
dedicated call center for customers to phone in their requirements, which would then
be delivered from the nearest Apna Bazaar outlet. An online presence, on the lines of
Sangam Direct-the online initiative of HLL-is under consideration.

• To ensure minimum inventory and maximum rotation, the co-operative is planning to

centralize its supply chain management. It is talking to FMCG majors like Tata,
Nestle, HLL and P&G to ensure rotation without building up much inventory. While
the super markets would be serviced directly by the companies, the requirements of
franchisee outlets would be met by Apna Bazaar to ensure better co-ordination.

• Apna Bazaar operates the Akshay Labh Yojana scheme wherein the customers can
deposit Rs. 10,000 at any point of time in the year and get items worth Rs. 100 per
month free. They also have term deposit schemes.

• Apna Bazaar has also entered into an eCRM tie-up with Venture Infotek, the e-
infrastructure solutions provider, whereby Venture Infotek provides the integrated
end-to-end solutions, with the shared infrastructure and payment-as-you-use payment
mechanism, without investment in infrastructure.

• The first thing on Apna Bazaar’s plans is to work on all 365 days like other big
players.

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• Upgrading the skills of their manpower and create vehicle parking facility are also in
their agenda. They plan to have a tie-up with Citibank on co-branding. Regarding
credit card, they are on the verge of signing a MoU with SBI. As visual
merchandising, a new way for presenting the products will be introduced.

• The National Consumers Co-Operative Federation has approached Apna Bazaar and
enquired about the possibility of running department stores under the brand name
Apna Bazaar in Delhi and Madhya Pradesh.

• Apna Bazaar is planning to open another outlet in Goa as they have got a good
response from the supermarket.

Recommendations:

• Government interference has had a major effect on the democratic setup of Apna
Bazaar. Therefore, lesser dependence on government should be opted for.

• Government should help stores like Apna Bazaar with credit at cheaper interest rates.

• Apna Bazaar should improve their capital assets by enrolling more members and also
introduce more product varieties.

• In the coming years, the economy will be dominated by the retailing sector. Times are
changing, organizations are changing. Changing according to times is inevitable.
Apna Bazaar has to change its traditional viewpoints. It should adopt new techniques
and accept change wholeheartedly. Bringing qualitative changes in their skill and
especially mindset will help it to survive competition.

• Apna Bazaar can open one outlet offering all the products it sells in the 80 outlets so
that people get all products offered by Apna Bazaar under one roof.

Other activities:

• Healthy child competition for member children.

• Ayurvedic camp conducted by apna bazaar every year in November.
• Consumer bulletins are printed and distributed to consumers, which gives them
information about various products stored by them.

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