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Speaking on the pricing strategy followed, she said, "We follow the strategy to sell around 100-120 items at any point of time at below Maximum Retail Price (MRP) rates. These are generally the key necessary items or the items for which the customer attaches more value. In addition, there are also lots of schemes and offers to attract and retain customers." "For procurement we follow a strategy of 'Hub and Spoke'.
The purchasing for each state is done collectively to reduce costs. The distribution to each outlet is done by Food World in such a way as to reduce the total handling costs."

To source its daily requirement of fruits and vegetables, Food World participates in the early morning auctions at the major wholesale markets and has a set of suppliers who then grade, clean, pack and label the products in time for early morning dispatch to the stores. At peak season, the Fruit & Vegetable shelf in a Food World store stocks around 125 items; making it the widest range available under one roof in this category.

Food World's share of the organized retail market in the cities in which it operates is 62%, clearly a dominant share. The firm expects the number of Food World stores to increase to 125 by the end of 2005. A smaller version, Food World Express is also planned to be launched in future.

SupplyCo

The Kerala State Civil Supplies Corporation (SupplyCo), is a statutory body established in 1974. It procures rice, wheat products, sugar, pulses, vegetables and a range of consumer goods independently from the open market and distributes them through a network of 663 retail outlets called Maveli Stores, 11 supermarkets in district headquarters and 21 Mobile Maveli Wans operating on designated routes.

The government decides the price of articles sold by SupplyCo through these shops, and has used it as a highly effective mechanism, cutting out middlemen and controlling prices in the open market. Its effects on the market are most evident during the festival seasons.

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* Contributed by -
Thomas Cris Sarasam,
B.E. (Elec. & Comm.), Karunya Institute of Technology, Bharathiar University,
Currently pursuing MBA (Systems/Marketing), College of Engg, Trivandrum.