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Value Retail Formats Preferred during Inflation

December 18, 2009


With the Food Inflation out of the hands of the Central Government, Value Retail Formats have all the reasons to smile as they see consumers increasingly seeking deals to cut on their grocery bills. Adding to Government’s woes is the Agflation – Agriculture Inflation due to Food Shortage. Value Retailers – Big Bazaar, More, Spencers have all stepped up efforts to offer discounts and bargain and maintain costs so that offers can be made to loyal customers.

Retailers like Aditya Birla’s More have seen increasing footfalls since Diwali as consumers seek deals on everything they can. Thomas Varghese, CEO of Aditya Birla Retail said,

The economy is growing fast and the overall confidence is reflected in the purchasing trends. We have not seen any negative impact on consumption ever since Diwali. In fact, consumers are shopping more at modern formats, which offer better prices than the traditional trade.

Mr. Damodar, Director of Future Group said,

In an atmosphere of high inflation, customers tend to put in extra effort to seek value. That translates into higher footfalls at value retail stores like Big Bazaar.

The impact is likely to be seen more in Rural India than in urban. However, select Food companies have started raising prices at less than 5% and they hope consumers will absorb the same.

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