Today we will discuss the business module of Avenue Supermarts Ltd. The company was started in 2002 And Its founder is Mr. Radhakishan Damani well-known Value Investor of India. If you see, Reliance Marts and Big Bazaar are having difficulty in getting profits, but DMart which is good profit is coming out. Let’s know-how…
As per Mr. Warren Buffet, It helps to be a good businessman if you invest in a stock market and it helps in good investment if you do business in real life.
Other supermarts are finding it difficult to earn good profits, but DMart is doing business with good profits. As an investor and promotor, Mr. Radhakishan Damani knows which business strategy should be used to bring good profits to the company and Mr.RK Dhamani handling DMart successfully.
Let’s see the Business Module:
Own Lands and Stores:
80-90% of DMart has its own stores and lands, so their rental income is very much saved. The advantage in this is that DMart does not have to pay the rent for stores And the disadvantage in that DMart needs a lot of funds to open a new store or purchase new land in different areas to expand their business, so it takes a lot of time to open to new stores. But after once increasing the stores, funds for new stores start coming in less time due to more cashflows from other stores. This is an advantage for many stores in operations.
their stores are located in main and populated areas, so people do not have trouble to visiting the stores.
Cash Discounts from suppliers:
Most Supermarts have 30 to 40 days Delayed payment to suppliers but DMart makes their payment very quickly and within time, due to which they get CASH Discounts on payments, and it is easier to give more discounts to the customer.
Products are available cheap prices at Dmart with a reason slotting fee. Dmart charges slotting fees from suppliers. if suppliers (manufacturer) wants to sell his product in Dmart that have to pay fees as Slotting fees. Due to these fees, they can give more discounts on products to customers, without any losses.
Sales at supermarts are in huge volumes and quantities, so they always purchase the goods in bulk from suppliers, therefore which gives them a trade discount on bulk purchasing. And these discounts get in help to give customers products at cheap prices. And From that DMarts make good profits in these modules.
Due to the products being cheap in Dmart, the crowd of people is very high. So the sales here are huge in volume. Also suppliers wants their goods (products) sold here with huge quantity, therefore suppliers sell their product to DMart with lower prices.
These are the Business Module of DMart. Where other competitors are in trouble to make good profit, And DMart selling products in huge volume and making huge profits.
DMart reaches 11 States and 1 territory in India with 176 stores working in the present. That was the little Business module of DMart.
Thank you for reading my blog…