Omnichannel retail

About 10 days back I decided that the number of covid-19 positive cases in Bangalore was high enough to recalibrate my risk levels. So I decided I’m not going to go to “indoor shops” (where you have to step inside the shop) any more.

Instead, as much as possible I would buy from “over the counter” shops (where you don’t have to step inside). This way, I would avoid being indoors, and as long as I’m outdoors (and wearing a mask) when I’m out of homeI should be reasonably safe.

However, over the years we have come to need a lot of things that at least in an Indian context can be classified as “long tail”. Over the last three months I’ve been buying them from the large format Namdhari store close to home. Now, that’s a large airconditioned shop which my new risk levels don’t allow me to go to. So I decided to order from their website.

Now, Namdhari is a classic “omnichannel retail” (the phrase was told to me by one of the guys who helped set it up). There is no warehouse – all customer orders are fulfilled from stores. You could think of it like calling your local shop and asking for delivery.

As you can imagine, this can lead to insane inventory issues, especially for a shop like Namdhari’s that specialises in long tail stuff. It is pretty impossible for a store to reconcile how much stock is there in the store with the website (even with perfect technology, you’ll miss out on what is there in people’s (physical) charts).

There is also the issue of prioritisation of customers that they are kept in the dark about. If the shop has a limited inventory of any item (and with long tail stuff, even a small spike in demand can make inventory very limited), how does it allocate it between people who have trudged all the way to the store and those who have prepaid for it on the website?

I wasn’t that surprised, I guess, when half the items that I had ordered failed to arrive. The delivery guy told me that the rest of my money would get refunded.

I wondered why they wouldn’t try to fulfil my order the next day instead. This brings me to my next grouse – there is no real reasons sometimes to provide same day delivery. If you offer next day delivery then you know tomorrow delivery volumes beforehand, and it will be easy for you to stock up. These guys had this process, it seems, where you have to order for the same day and if the thing runs out you don’t get it at all.

In any case, three days after my half-fulfilled order had been delivered I got a mail that refund had been initiated for the items I had ordered but hadn’t arrived.

It was like writing a cheque. Cheques are inefficient because between the time it is written and encashed, neither the giver nor the receiver has access to the funds (online transfer such as IMPS, on the other hand, ensures that the money is in either the giver or receiver’s account at all points in time).

So my order which had been partially fulfilled was in a similar trishanku state – I didn’t know if it would arrive or if I should order the same items from elsewhere. In case I waited I would have the risk of getting the stuff even later (since I’d delay order from elsewhere).

It was only after it failed to arrive on Wednesday (and I got the mail) that I was able to place an order from elsewhere. Hopefully this one won’t get into trishanku state as well.

A trip to the supermarket

Normally even I wouldn’t write about a trip to a supermarket, but these aren’t normal times. With the shutdown scheduled to go on for another two weeks, and with some “essential commodities” emptying, I decided to go stock up.

I might just have postponed my trip by a few more days, but then I saw tweets by the top cop of Bangalore saying they’re starting to seize personal vehicles out on the road during the lockdown. I needed to get some heavy stuff (rice, lentils, oils, etc.) so decided to brave it with the car.

Having taken stock of inventory and made a longlist of things we need, I drove out using “back roads” to the very nearby Simpli Namdhari store. While I expected lines at the large-format store, I expected that it would be compensated for by the variety of stuff I could find there.

I got there at 230 only to be told the store was “closed for lunch” and it would reopen at 3. “All counters are open”, the security guard told me. I saw inside that the store was being cleaned. Since it’s a 3 minute drive away, I headed back home and reached there at 3:15.

There was a small line (10-15 people long) when I got there. I must mention I was super impressed by the store at the outset. Lines had been drawn outside to ensure queueing at a safe distance. Deeper in the queue, chairs had been placed (again at a safe distance from each other) to queue in comfort. They were letting in people about 10 at a time, waiting for an equal number to exit the store each time.

It was around 335 by the time I got in (20 minute wait). From the entrance most shelves seemed full.

The thing with Namdhari’s is that they control the supplies of a large number of things they sell (fruits, vegetables, dairy, bread, etc.), and all of them were well stocked. In times like this (I can’t believe I’m using this phrase!), some sort of vertical integration helps, since you can produce the stuff because you know the downstream demand.

(in any case, for things like vegetables and milk, where there is a large gap between “sowing” and “reaping”, production hasn’t fallen at all. It’s a massive supply chain problem and plenty of stuff is getting wasted while people don’t have enough. Stuff like bread is where vertical integration helps)

In any case I took two trips round the supermarket with my trolley, checking items off my checklist as I put items into the trolley (unusual times mean even disorganised people like me make checklists). Again the vertical integration showed.

Stuff that Namdhari’s owns upstream of, like staples and oils, were well stocked. High demand stuff for which Namdhari’s is only a reseller, like Maggi or crisps or biscuits were poorly stocked. Interestingly, “exotic stuff” (like peanut butter or cheeses, around which Namdhari’s has partly built its reputation) was reasonably well stocked, for which I was really thankful (we consume far more of these than the average Indian household).

How much to buy was a dilemma I had in my head through the shopping trip. For one, there was the instinct to hoard, since I was clear I didn’t want another shopping trip like this until the shutdown ends (milk, vegetables and eggs are reasonably easily available close to home, but I wasn’t there for that).

On the other hand, I was “mindful” of “fair usage policy”, to not take more than what I needed, since you didn’t want stockouts if you could help it.

The other thing that shortages do to you is that you buy stuff you don’t normally buy. Like the other day at another shop I’d bought rice bran oil because groundnut oil wasn’t available. While you might buy something as “backup”, you are cognisant that if you get through the lockdown without needing this backup, this backup will never get used.

So even though we’re running short of sambar powder, I ignored it since the only sambar powder on offer looked pretty sad. On the other hand, I bought Haldiram’s Mixture since no “local mixtures” are available nowadays, and mixture is something I love having with my curd rice.

I was a little more “liberal” with stuff that I know won’t go bad such as dry fruits or staples, but then again that’s standard inventory management – you are willing to hold higher inventories of ┬áitems with longer shelf life.

I might have taken a bit longer there to make sure I’d got everything on my list, but then my “mask” made out of a hanky and two rubberbands had started to hurt. So, with half my list unfulfilled, I left.

Even at the checkout line, people stood a metre away from each other. You had to bag your own groceries, which isn’t a standard thing in India, but enforced now since you don’t want too many hands touching your stuff.

Oh, and plenty of people had come by car to the store. There were cops around, but they didn’t bother anyone.