The global online pharmacy sector is almost $30 billion in 2014. It is growing at a CAGR of 17.7 percent, and would touch $130 billion by 2023.

The central government prepared draft rules for regulating e-pharmacies. They are called Drugs and Cosmetics Amendment Rules, 2017. They expect to govern the online pharmacies under the ambit of the Drugs and Cosmetic Rules, 1945, the IT Act, 2000 and the Narcotic Drugs and Psychotropic Substances Act, 1985.

According to the rules:

o the empharmacies have to register with the Central Drugs Standards Control Organisation (CDSCO)

o they should apply for license renewal every three years.

o there is a fee of Rs.50000 for every renewal of license.

o there will be two yearly inspections of the premises by the teams from Central Licensing Authority (CLA)

o the portals will be filling the prescriptions of scheduled drugs only against prescriptions.

o they would be barred from selling Schedule X drugs, tranquillisers and narcotic substances.

o they would maintain itemized records of the details of the patients, details of the prescriptions, details of the drugs supplied.

o they will declare the details of the owners, directors and partners.

o they should give the details of the pharmacist under whose supervision the drugs are dispensed.

o they should give details of the vendors and supply channels.

o advertisements are forbidden.

o privacy of the data of patients to be ensured.

There are grey zones in the draft but this is a good beginning.

The rules have been framed taking into consideration the marketplace model, where the pharmacy chooses an offline vendor to supply the medicine.

The draft is resisted by the brick-and-mortar stores. They feel they will be adversely affected. They also feel that pharmacy as a business is not suited for online operations.

The seeds of e-commerce were sown way back in 1971 when the Advanced Research Projects Agency Network ( ARPANET ) was used to arrange a sale of an undetermined quantity of cannabis between students at the Stanford Artificial Intelligence  Laboratory and MIT. It could be called ‘a seminal occasion in the history of e-commerce.’  However, it was eight years later, in 1979, that the first online shopping system was displayed. UK-based Michael Aldrich’s invention started as a cross between a modern-day B2B and B2C model. Two years later, ( 1981 ), Thomson Holidays became the first B2B platform for online shopping. Amazon, eBay and Alibaba emerged much later.

In India, there were several start ups — JustDial, MakeMyTrip, InMobi, RedBus, FlipKart, Snapdeal, Paytm and Pepperfry. To begin with there was Rediff  era of the late 1990s and the government’s IRCTC portal. Since then e-commerce has carved out a path for itself in India.

FlipKart’s first customer was V V K Chandra. It was 21 October, 2007. There was a little beep on the computer screen informing the Bansals that they had their first hit. It was a young man from a small town called Mahbubnagar in AP, now Telangana. Chandra ran a small company for web consulting. He was fond of books, and was scouting for John Wood’s book — Leaving Microsoft to Change the World, but was not getting it anywhere.

Chandra did not know that his request for the book has created a stir of excitement in an apartment in faraway Bengaluru. Two anxious pair of eyes gazed at the order from their very first customer. Binny Bansal located a copy at a store in Indiranagar ( Bengaluru ) borrowed money from a friend as he had forgotten his wallet and Flipkart’s first product was packed and delivered.

In June 2011, a village in North India decided to change its name from Shivanagar to Snapdeal.com Nagar. That was in return for the Snapdeal founders donating. 15 hand pumps to the village. The villages got what they most wanted — water.

Flipkart charges a market place fee — a percentage of the selling price of a product inclusive of a selling commission, a closing fee and shipping charges. The selling commission can be as low as 4 per cent to as much as 25 per cent, depending on the product. Flipkart proposes to do away with the commission it charges its merchants so as to enlist more of them. The company aims at having 1 lac merchants by the end of 2015, up from 30,000 now. It will instead urge sellers to advertise on the platform. It will make Flipkart more sustainable in the long run. Snapdeal owned Shopo too has become a zero commission platfor. It is mobile-only market place.

Brick-and-mortar retailers are using electronic shelf labels. Once a store adopts digital displays, one person, rather than an army of persons, can quickly update the prices on thousands of products in multiple locations. The increased use of electronic shelf labels is changing the in-store experience. This has become popular in Europe over the last decade. Pricer is the Stockholm-based market leader in digital pricing displays. The need to compete with online e-commerce sites has accelerated the pace of electronic shelf labels. It allows a store to change the prices quickly. It can be integrated to smartphones applications. There are price changing algorithms used by merchents to keep pace with the competition. There would not be a gap between the store price and online price. It leads closer to perfect market conditions.

The discrepancies in prices the consumers face at the check out counter is eliminated. There are reduced number of complaints, returns and cancellations. Many employees who were pasting price labels manually are freed from the chore. There are some problems too — customers keep on waiting for the price change on the lower side before they buy. Amazon makes price changes all day long. As a matter of policy, a store may open with lowest prices. After 5 minutes, there is no guarantee how the prices will move.

This audit relates to FMCG companies. The audit has been refined. It now covers 25000 outlets, as against 16000 previously. Formerly, the audi assessed the changes in retail once in three years. It now goes to market every year. They have the co-operation of all the large retailers. The audit is getting more national, with a large number of stores represented. A new service being launched in 2012 will track the scan data from modern trade on a weekly basis. It benefits the manufacturers in promotion and assessement of consumer impact of the store. It benefits the retailers in managing the assortment and make available the right product for shoppers. They can compare their stores against the rest of the stores in the city.

BPCL has 12,500 fuel outlets where they can potentially open up retail outlets — there were in past In&Out convenience stores and quick service restaurants (QSR). Some of these outlets were earning as much as Rs 400 per square feet, but most were yet to attract footfalls. The company now has tied up with BCG to do the catchment area analysis to decide the merchandise to be stocked, and  the location of the outlet. There would be a separate SBU for this non-fuel business. The outlets can have e-seva kendras, and Aadhaar centres. These outlets will also explore the possibility of being the pick up point for e-commerce sites such as Amazon.

It was the year 1948. A supermarket executive approached the Drexel Institute of Technology, Philadelphia to get  a technology that could encode information about its products. Bernard Silver and N. Joseph Woodland, two graduate students, took the challenge. Woodland dropped out of school to concentrate on this. He sat on the Miami beach that winter. He dragged his fingers in the sand. He got the idea of a series of different lines of different widths that functioned like elongated versions of the dots and dashes of Morse Code. In other words, a bar code. The man who gave us barcodes expired on Dec. 9, 2012.

According to Kishor Biyani, any retailer can be a marketplace and any marketplace is also retailer. E-commerce retailers advance the argument of just being the marketplace from which the consumers buy, but the goods are supplied by a host of vendors from their inventories. Here it should be made clear that for most supplies the inventories of even virtual retailers are held in the warehouses of the virtual retailers. The only difference is the accounting treatment of the inventories.

• Some account this inventory on their balance sheet.
• Other account for it in their suppliers’ balance sheet, irrespective of the physical location of the inventory.

However, there are brick-and-mortar stores who also do not account for the inventory on their books. That wipes out the artificially created difference between the virtual and brick-and-mortar retailers. Therefore, the demand for the physical retailers is to have one common policy of overseas investment in multi-brand retail. At present online retailors are violating the existing FDI policy in letter and spirit. Marketplace model is just another name for smart accounting.

A retailer’s brand image is made up of the perceptions about its merchandise, customer expectations and experience and the way they distinguish it from other competitions. As the formats are more or less similar, brand management is all about how a retailer makes a significant difference by building up top-of-mind recall and customer preference for itself over others. The customers expect a ‘coolness ‘factor, better shopping experience, connect and quality. The retailer uses tools such as MR, data analytics and consumer behaviour studies in association with merchandising teams to achieve the objectives.

Brand management creates loyalty in customers’ minds. It is a commitment to a particular retailer that survives the test of time, market changes, rising MRPs, competition and occasional quality fluctuations.

Some useful measures for better brand management in retail are:

A Strong Reason to Buy ( RTB ) : It is the proposition of the retail brand. In other words, it offers the projected differentiation, the value promised and the incentive to return on a regular basis.

The Service Quality : The hygiene level, the measures to delight the customer and great service influence the loyalty.

Innovative Schemes :   There are schemes and offers. The products are refreshed periodically. There are discount schemes. All this creates word-of-mouth publicity. All this increases the footfalls.

Loyalty Programmes : These programmes reward the loyal customers. They are a reason for them to return to the shop again.

Communication : A retail  brand must know when and how to communicate its proposition, loyalty programme updates and the schemes.