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To get started the Shakti woman borrows from her "Self Help Group" and the company itself chooses only one person. A Shakti entrepreneur receives stocks at her doorstep from the HLL rural distributor and sells direct to consumers as well as to other retailers in the village. Each Shakti entrepreneur services 6-10 villages in the population strata of 1,000 - 2,000 people.

The women avail of micro-credit through banks. Some of the established Shakti dealers are now selling Rs. 10,000 - Rs. 15,000 worth of products a month and making a gross profit of Rs. 700 - Rs. 1,000 a month. The company is creating demand for its products by having its Shakti dealers educating consumers on aspects like health and hygiene.

Others
Marico launched a major initiative into rural markets by appointing 2,400 sub-stockists in the last two years. Recently, Dabur recently finished a pilot project for its super-stockists in Patna and has now rolled it out in Bihar, Madhya Pradesh and Rajasthan. Reckitt has also adopted the super-stockist system in Tamil Nadu and plans to set up such a system all over the country in the next year, with the target of covering one million outlets in the next three years.

3.5 The Rural Remedy

The business model for rural retail can be successful only when integration between the profit and social motive is apparent. The social angle needs to be pronounced for it to be acceptable. The model should empower the rural consumer and at the same time take advantage of this empowerment through creation of demand for its own products and that of its partners.

The roadblocks in the way of retail revolution hamper the growth of the industry both in urban and rural areas. These bottlenecks if not removed have the potential to retard the rapid progress that this sector has been witnessing.

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* Contributed by -
Harmesh Mehrotra & Manu Arora,
MBA (IB) 2004-2006,
School of International Business,
Indian Institute of Foreign Trade, New Delhi.