'Me-too businesses' in the retail space will "fail" in the current market scenario, while others that add value will continue to attract investor interest, industry veteran Harsh Mariwala has said. Mariwala, chairman of fast-moving consumer goods (FMCG) company Marico, said businesses ought to listen more carefully to changing market conditions and respond with innovation that creates impact.
"We will see the worthy players in the retail sector that continue to add value gain from the high investor interest and we will see the 'me-too' variety of businesses fail in the current market scenario," Mariwala told. He said this while answering a question on the future of companies that have invested in distributor chains amid significant investments by e-commerce players into some traditional chains.
He added that the distributor chains will not disappear, nor would they be rendered irrelevant. "However, the relationships (with distributors) may evolve into a new format to keep in step with the change consumer demands and market conditions," he said.
People are anxious about health, employment and finances, and the path to recovery will depend on how long the pandemic lasts, he said adding that rural demand will hold up for "some time".
The rural demand situation will be helped by good monsoon and the government's support to provide employment opportunities in the rural areas, he said.
He also hoped for the festival season to generate enough demand to keep the wheels of the economy moving till the end of the year. Even though businesses are focused on survival currently, this is not a time to stop innovating but rather double up on it to yield results in the new scenario, he said.
"Businesses can't rely on stimulus and government initiatives alone. Businesses must take innovation-led, aggressive measures towards building capacity utilisation and driving demand, which will help drive revenues," he said.
He added that the task is for businesses to listen more carefully to changing market conditions and responding with innovation that creates impact.
Mariwala, who is also the founder of the Marico Innovation Foundation that is hosting awards on business innovation, said that healthcare, mental health, fitness, education, wellness and FMCG and retail spaces are the best from an innovation perspective given the current circumstances where digital inputs are important.
The foundation has recognised the efforts undertaken by entities such as Agatsa Software for pocket-sized ECG device, Genrobotics for eradicating manual scavenging, and Goonj for creating a circular economy and making 'giving' dignified, and also the Indian School of Development Management for their innovative efforts.
Copyright©2023 Living Media India Limited. For reprint rights: Syndications Today