Strategic tools for the practising manager

KIT

The optical retail market is poised for a healthy growth of 18-20 per cent annually, from the current Rs 2,700 crore.

It is expected to more than double in the next five years and attain a size of Rs 6,000 crore.

The optical market is highly unorganised (83 per cent), but with the products coming in the ambit of lifestyle purchases. With fundamental changes in modern retail, the organised share within this category is likely to gain impetus in the coming years.

The contribution of branded sales to the overall optical retail market for the sunglasses category is significantly high (70 per cent).

The spectacleS market remains highly unbranded "" only 20 per cent of the market is branded. One-fourth of the sales for spectacles are through opticians/doctors "" this emerges as an important channel for any player entering into the spectacles category.

The market is predominately unorganised and the majority of outlets are located mainly in neighbourhood markets. Most shops are just about 350-400 sq ft.

NUGGETS
Selections from management journals

THE POINT OF SALE (POS), whether physical (such as a retail store shelf) or electronic (such as a Web site), represents the true centre of the manufacturing-retailing universe. It is time for manufacturers and retailers to recognise the full power of the shelf: the potential that they can realise only together.

The authors call this new approach shelf-centred collaboration (SCC). With SCC, manufacturers and retailers can finally turn customer information into profitable insight. Working with carefully selected value chain partners and using new kinds of analytics, they can shift focus from the "mean" to the "meaningful": from aggregated sales figures to a granular understanding of consumer demand by item, by store, and by day.

Partners at the point of sale
By Rich Kauffeld, Johan Sauer and Sara Bergson strategy+business, Autumn 2007
www.strategy-business.com

The huge sums that private equity firms make on their investments evoke admiration and envy. Typically, these returns are attributed to the firms' aggressive use of debt, concentration on cash flow and margins, and hefty incentives for operating managers.

But the fundamental reason for private equity's success is the strategy of buying to sell "" one rarely employed by public companies, which, in pursuit of synergies, usually buy to keep. The chief advantage of buying to sell is simple but often overlooked. Private equity's sweet spot is acquisitions that have been undervalued, where there's a onetime opportunity to increase a business's value.

The strategic secret of private equity
By Felix Barber and Michael Goold
Harvard Business Review, September 2007
www.hbr.com