Last week, when I was home on my break, lazing in front of my laptop, my mother commanded me to go out and buy a few groceries and other household items. I think the command was more out of a concern for my laziness rather than an actual need for the groceries.
So, I ventured out of home and arrived at the main street and got instantly confused, with all the store options. But almost immediately, one particular shop caught my attention and in my ‘Blink’ moment I had made the decision. I ended up spending over an hour at this store.
Here are the 7 Entrepreneurship lessons I learned from this kirana store owner:
Social Media and Customer Engagement
Within the time period of an hour, this guy must have serviced around 30 customers. He made it a point to speak to every single one of them whether it was asking Person X, when his son was coming from college for vacations or Person Y, how her mother’s kidney operation went. In fact, as soon as he saw me, first thing he asked me who I was and where I lived.
Many businesses have a notion that Social Media and Customer conversations can be outsourced. I firmly believe that the business person(s) should be the one engaging with the customer, one-on-one. Consistency in communication is very important for the brand image of a business setup.
Deep Understanding of Customer Preferences
I asked him for a bottle of shampoo, “Arre koi bhi chalega. Head & Shoulders de do.” (Any brand would do. Ok, give me Head & Shoulders.) To which he replied, “Par aapke ghar to ye waala jaata hai humesha.” (But your family generally prefers this brand.)
This guy knew about all customer’s preferences. And, this was not a one-off case. It happened two more times, while I was there. I tried to imagine all that data in his head. I was amused and surprised at the same time.
Recruiting the Influencers
“Why are you giving out free chocolate to these kids?”, I enquired. He smiled and said that those kids will go home and tell their parents about his store and how they got free toffee. This in turn will lead to repeat purchases.
He had nailed the concept of ‘recruiting the influencers’. Now, I am not advocating sending gift boxes to the influencers. But the point being driven is the importance of getting the key influencers to like your business.
He personally delivers to all his customers’ houses during his lunch break and after shutting shop at night. He also takes returns. I asked him if he encountered any problems due to returns. It turns out very few people actually return stuff and this is mostly the case with bulk purchases, in which case, he anyways ends up selling more in a day than he would generally in a week.
He makes it a point to discuss the quality complaints with his distributor. This ascertains that the distributor is always on his toes and delivers the best quality product to this store.
Differentiation based on Pricing Strategy
I decided to probe further and the next part turned out to be very interesting. This owner finds out from other customers what the other stores’ price points are. Then, he differentiates his pricing considerably for a few high-margin products.
He gave me the example of a Glucose-D 1 kg jar (MRP -INR 139; Wholesale cost- INR 102). So, the store owners have a margin of INR 37 off the shelf. He immediately priced it at INR 118 against the neighbor’s INR 125.
I wondered how many 1 Kg jars he would sell anyways to make a decent return, on the premise of selling more volume to offset for the lower margin. His long-term thinking blew me off.
It turns out the whole thing was about the conversation that it would start in the circles about how his store was selling stuff cheaper than the others nearby. He knew that people tend to generalize and Glucose-D would end up not even getting a mention in those conversations.
Thoughts on Competition and Competitors
This store owner resides 6 kilometers away from his store. He had figured out way back that he was not going to sell much near the area he lived in. After scouting for possible areas, he decided to do it in my community, which already had 10 kirana stores. Again, this guy did not see that as fierce competition, but as an opportunity of catering to a larger population.
There is too much hype about disruptive innovation and unique ideas. But we must not forget that sometimes it’s just about building a ‘better mouse trap’.
His store is open 24X7 (well, not literally)
The other store owners open shop at 9:30 am, despite the fact that they stay nearby. His, opens by 8 am and is generally the last one to close at 10 pm. Even on Sundays while the others are enjoying a holiday, he keeps his store open. Guess who’s selling while the others are busy sleeping.
No wonder he has a vocal army of loyal customers singing his praise and bringing in more and more of them.
Overwhelmed by the zeal, and pedigree of this entrepreneur and having taken a class in Marketing, Finance, Sales etc from him, I returned home.
I told my mother and grandmother about the amazing story that I had heard and recommended that they do their grocery shopping from this store. They smiled and told me that all the grocery at our house always came from the same store. “Of course”, I exclaimed.