new delhi the retail revolution isnt going to take place without bloodshed indeed while much of the excitement is centred around new formats the tiny tribe of newage retailers have an uphill task on their hands take hyper markets the large roughly 1 lakh sq ft and above stores that buy in bulk stock an excellent product mix and offer attractive discounts while the rpg group has launched the giant in hyderabad and the home stores india ltd is going to soon kick off three metro sabka bazaars around delhi in partnership with ansal housing roadblocks remain manufacturers are unwilling to give bulk discounts supply chain inefficiencies eat into margins customs duties make global sourcing unviable and quality remains an issue with small suppliers take sourcing manufacturers are unwilling to give bulk discounts reasons vary the most obvious being a pressure on margins equally important is containing the channel conflict volumes are not large enough either to sway manufacturers at this stage as shivir jain ceo of e foods mart says hyper markets need to reach a certain scale of volume for them to ask for higher discounts jain feels this will take a couple of years at least sue evans retail expert at consultancy at kearney too says bulk purchase are the keywhile current conditions may inhibit growth and change may not happen fast they would eventually be negotiating with supplier to get discounts she says hyper market players seem to be doing that already says arif sheikh president thsinitially there was a lot of resistance from suppliers but a number of them are talking to us now k mudaliar coo great wholesale club which runs giant too says the suppliers are not really keen to give bulk discounts one has to negotiate he says manufacturers are bound to see the gains eventually he adds an industry observer explains furthermanufacturers are unhappy with the emerging formats discounts is one issue the other is increase in costs in terms of advertising and promotion budgets to be forked out which they were earlier adding to their bottomlines meanwhile in the absence of bulk discounts the hyper mart margins are getting tighter as arvind singhal ceo ksatechnopak points out these retailers with investments in property employees technology promotion and marketing need higher margins than kirana stores typically 810 per cent to survive how will the hyper markets give discounts he asks singhal adds not enough margins can be squeezed from supply chain management either thanks to inefficiencies sheikh agrees the solution he has foundwe are sourcing and packing all material ourselves cutting out intermediaries this controls costs as well as quality in fact mudaliar says the nofrills giant achieved positive turnaround in the very second month of trading with strict inventory and expenditure control the store is recording 530 per cent margins for products ranging from fmcgs to general merchandise all this while it offers attractive discounts