In a bid to penetrate into the rural pockets and increase its presence in the rural parts of India, state-owned Steel Authority of India Limited (SAIL) has announced that it would soon appoint 1,000 new dealers.
In order to create mass awareness about its rural presence, it will offer incentives to these dealerships irrespective of the quantities sold. “SAIL plans to appoint 1,000 rural dealers in taluka, blocks and panchayats under this scheme during the current financial year with the aim of increasing consumption of steel in rural India,” the company said in a statement.
As per the present data, the per capita steel consumption in rural India is estimated at only 9.78 kg as compared to around 140 kg in urban areas. The steel major has decided to extend attractive financial terms and conditions and incentives to popularise its newly launched rural dealership scheme. “First, dealers will not have to bear the burden of a monthly commitment for offtake of material from SAIL. This would encourage small retailers in the hinterland to reach SAIL's materials to remote locations,” the company said.
To minimise the financial risk of the rural dealers, the company has also done away with the norm of collecting security deposits for offtake of material.
The statement said this step was taken to encourage the rural dealers to generate greater volume business with SAIL, since purchasing power was relatively low in rural areas. To make the operations of the rural dealers smoother, the company would also give them appropriate credit facilities, the statement said.
SAIL would also supply promotional items and various point-of-purchase materials to the dealerships to get better visibility in their areas. “The dynamic changes initiated in SAIL's retail marketing will go a long way in meeting our long-term strategy of further spreading the network and making it more robust in terms of easy procurement and supply in the rural hinterland,” SAIL Chairman C. S. Verma said.
The company would also arrange for the transportation of steel products from its nearest warehouses to the dealer outlets and would bear the transportation costs, the statement said.