MARKETING

We consider relationship management an important aspect of marketing for our supermarket as we are the retailers and we have to maintain proper trustworthy relations with all our wholesalers. As far as building relations with the customers is concerned, we have initiated a loyalty card program. Through this program, the customers collect points. For every 100 Rs of shopping they carry out, they collect 1 point. Once they collect more than 50 points i.e. when they shop for more than 5000 Rs, they can redeem all their shopping money above the 5000 Rs mark. The campaign has been a huge success and we have been able to make many loyal customers due to this. There are other ways of building relations with the customers and this includes keeping a track of their database. Through this, we are able to identify the most frequent items of purchase for each customer and through their email address; we constantly inform them about the new varieties of their favorite product that come to our supermarket and also inform them about the various promotional offers and discount schemes that are launched at our shop for various products. We also keep in touch with all of our customers through the Facebook which currently has 11000 members. We identify Aghaz and Imtiaz supermarkets as our major competitors but the way we compete with them does not involve advertising or promoting our supermarket to the customers. We compete only based on our USP which is to provide high quality products which also involves providing 100% hygiene. The supermarket also launches its own discount and promotional campaigns for all the products which again depends on the factors of peak seasons of products sales and special occasions. As far as the marketing of our wholesalers products at our supermarket is concerned, the sales staff of our wholesalers themselves come to our supermarket and market their products to the customers. We are only responsible for executing the promotional and discount schemes of our wholesalers products. Margins depends upon open displays of merchandise around focal display creates an attractive selling area. Also retailers can boost sales by displaying together items that complement each other. Since display height is very important, Kids products are placed at lower height so that kids can see the products. Display heights are according to standards of retail industry. We focus on advertising on special magazines and that too is not done regularly. We do not even possess a marketing department and all the marketing of our supermarket is done

through promotional and discount schemes at our shop only and through our loyalty cards and Facebook.

FINANCIAL ASPECTS
We maintain proper books of account and update our balance sheet every month. All the products that we buy from our wholesalers, we put up a certain retailers margin on it and then sell it to the customers. This margin is our sole source of income. The luxury items carry the largest margins which includes digital cameras or mp3 players. Items that carry the lowest margins are items that are purchased more frequently such as certain food items or soaps. Our annual profits are around 10% of our sales. The corporate taxes imposed on our overall income are around 30%. Our costs related to the maintenance of inventory are around 2% of sales. Other costs include the costs of cleaning the supermarket and the wages of the workers. The total inventory we maintain is around 30% to 40% of sales

As far as the overall investment in setting up this new branch is concerned, two types of costs are involved: the cost of purchasing the land and the cost of installing the infrastructure. The total costs for this entire set up was around 20 million Rs. 75% of this set up cost came from the capital of the partners of the business who happen to be the family members. The rest of the 25% of investment came through the bank loan. The bank charges a very large percentage of interest which is more than 2% to 3% of the market rate that currently stands at around 13%. There are credit policies for the customers. We also do not get any bulk buying discount from our suppliers as we only buy a certain quantity from our wholesalers that we can store in our supermarket and inventory room. But, we are given a credit time period policy by the wholesalers that allow us to make payments to them after two weeks or a month but not more than that. Prices are also negotiated with the wholesalers based on shelf space which involves aspects such as how much shelf space the wholesalers products occupy and where the products are placed i.e. in the front part or back part of the shelf space. We do not market or promote the products on behalf of our wholesalers, they do it themselves and hence, no such costs regarding these are involved.

LOCATION ASPECTS

Naheed Supermarket is located in the central part of the city, on Siraj ud Daula Road near Bahadurabad. The reason we chose this area as our location was because we have been doing business in this area ever since the 1970s when we opened our very first supermarket in this area. We know this area very well and since we have been operating here for a very long time, we have been able to build a long term loyal relationship with the customers of this area. Our location in this part of the city does not bring about any problems as far as the supply of labor is concerned. This is due to two reasons. Firstly, we need only unskilled labor which is located everywhere and so we did not face any problems in searching for them. Secondly, the wages paid to these unskilled workers is the same at all major areas of the city and there are no such problems of having to pay our workers more due to our location in a well developed area like Bahadurabad. We are presently not interested in any such expansion since we are short of management staff and we dont think that the present staff is quantitatively enough to run branches in more than two areas. There was shortage of space in our old branch that is located right behind our new branch which opened this year. This created many problems. Firstly, customers were unable to move freely all around the supermarket as there used to be a lot of congestion due to a pool of large number of customers moving in a very short space. This made it difficult for the staff to take care of customer problems at the supermarket. Secondly, we had to compromise with our wholesalers in terms of the number of varieties of a single product that we could keep at our supermarket because not much space was available to accommodate all the varieties of all the

wholesale products. Thirdly, there are many luxury items that we wanted to keep at our supermarket such as T.V. but were unable to do it because of lack of space. All these factors could have meant that our wholesalers could have switched to other supermarkets and we could have lost our business to our competitors. Hence, we had to open up another branch close to our old branch. The new branch is obviously much bigger and avoids most of the problems we faced earlier due to less space. The old branch is currently under construction and once it is completed, it will be used for the promotion of new products of the wholesalers. We are also aware of the fact that our prime location in Bahadurabad presents many problems related to parking for the customers. We have taken steps to counter this problem and a large parking base is currently under construction in the building next to our supermarket and will be open for customer car parking soon.

Retail Layout
Retail layout is the arrangement and method of display of merchandise in a store. A layout pattern of Naheed is the Grid Layout in which displays are arranged rectangular fashion so that aisles are parallel. It is formal layout that controls the traffic flow through the store. Due to high traffic flow at Naheed, there was congestion in previous branches of Naheed so this branch is very capacious and which is the plus point of new branch and it was one of the main reasons of creating a new branch. Naheed Supermarket is composed of two floors and a ground floor. Ground Floor: Groceries, Beverages and Cash Counter. First Floor: Pharmacies and Cosmetics Second Floor: Garments and CDs

Nonselling area is separate from selling area of the store otherwise it occupies prime selling space with non selling functions such as storage, office, dressing area. This was the problem in the last branch as there was less area. Naheed does not have any specific theme for their retail layout. Mixtures of white and brown lights are used to create a pleasant environment within the store. Naheed store has a bright and light feel to it and ceilings are done in light colors to reflect store lightning. For interior, lights and fixtures, Naheed this time hired a specialist for building a new branch.

The external appearance of Naheed is pretty modern which coincides with owners desired image. The appearance reflects the business personality. Automatic doors are installed to ensure a smooth traffic flow into and out of their stores. Sign of the supermarket is large enough for passerby to read it from distance and contrasting colors are used to gain attraction. HUMAN RSOURCES There are two employee levels at Naheed; Low and high level employees. The low level staff at the supermarket comprise of the sales persons who facilitate the customers into buying the products, carrying and moving it for them and so on. Then there are the security guards who are responsible for security at the exit and entrance doors. far as the hiring procedures for these employees are concerned, There are no education requirements for these employees but they are given training as soon as they join the supermarket. The training is on-the-job in nature which means that the staff learns while also doing their regular job. The training involves informing the staff, specially the sales staff, about the products. The salaries given to low level staff ranges from the minimum wage of rs.7000 to rs.10000. The employees are not given any fringe benefits but it is the policy of the store to give one month bonus salary to all members of the staff if they punctual. Since the low level staff often comes from various places in Pakistan, they are also allowed to go for holidays for a maximum of 2 months in 2 years. The high level staff at the supermarket comprises of the cashiers. There are no formal hiring procedures for them either. The education requirements for them are that they should have done their matriculation at minimum. The biggest emphasis is given on their computer education. This means that they should be able to handle the computers basic functions, especially those that relate to cash and inventory related accounts. The training provided to them is often more formal and could last for about 1 month. The purpose of training is to teach them on how to effectively use the systems in place. The salaries paid to them go to a maximum of Rs. 30000. The yearly bonus salary policy of the store also applies to these employees. There is annual reward for employee of the year which again serves as an incentive for all the employees to give their best throughout the year and be recognized for their efforts. Performance of employees is gauged through observation, feedback both from employees and customer. The family run business conducts on and off the job discussions on a regular basis with all the employees of the supermarket to determine their views on issues such as placement of products, customer complaints and suggestions and whether there are any problems with the systems in place and what can be done to make things better with regards to day to day operations of the supermarket. This is an important motivating factor for the employees at the supermarket.

MANAGEMENT OF OPERATIONS
Naheed supermarket keeps a 100% level of inventory at its supermarket. The manager of store says that they have two warehouses close by and they believe that the space is adequate enough to maintain such a high level of inventory and they see no present need to enlarge the space or buy another one for this purpose. They have a sales forecast analysis for each category of products which helps them to predict how much inventory is needed for each product. This also determines how often the supermarket buys products from its suppliers to maintain the required level of inventory. The store makes arrangements with its suppliers based on this shelf life of each product. The mode of arrangement is that the suppliers are themselves responsible to make a visit to the supermarket daily, weekly or monthly, depending on the product, and are constantly kept informed about how much further inventory is needed. The goods are physically counted at the warehouse on a daily basis to keep a record of the daily inventory count. Then there are the point of sale systems in place as well which involves the use of bar codes. Another aspect of managing operations in a supermarket is to keep a check on inventory theft which involves theft from employees themselves or from customers, known as shoplifting. The store manager says that shoplifting is not such a major issue but employee theft of inventory does take place on a daily basis. CCTV cameras are in place at both the supermarket and its two warehouses that serve as a deterrent to prevent such theft. The supermarket makes sure that it adheres to all the laws of safety and security for both the customers and employees. Fire extinguishers are in place to deal with outbursts of fire in the store. The presence of multiple cash counters and different doors for entry and exit also ensure that there is no congestion at the supermarket at any place while the store is also large enough for the customers to roam around freely and comfortably without any hassles of congestion. This gives the supermarket an excellent feel and provides for a good customer environment.

Technology
Customer Loyalty Cards
Business nowadays, put more focus in relationship building that is creating long term relationship with customers than ever before. At Naheed Loyalty cards, for example, are carried by customers and can be swiped at the cash point by a staff member; the customer accumulates points per purchase which can be used to get money off later purchases. Customer Loyalty Program is a fully integrated system capable of recording customers shopping

automatically whenever one shops at Naheed Super Market. However, you are required to ensure that your membership card should be swiped when paying at the counters.

Security Cameras
Naheed now benefit from store protection methods including CCTV systems, which can record criminal activity in stores. The role of video is to provide the remote eyes for management and security department. The viewed scene should be of point of sales terminals, cashiers, expensive products and access and exit locations. Our contact person says that video provides a significant cost advantage as compared with the equivalent security personnel required. Our contact person says that they keep hold of recording of fifteen days which has dramatically controlled shoplifting.

Bar Codes
Naheed store uses bar codes for inventory control, inventory identification, and also to help cashiers for checking the prices of products. A barcode is an optical machinereadable representation of data, which shows certain data on certain products. This is how bar code is used at Naheed. All products can be entered into a computerized database using specific inventory software. Bar codes are issued at each product SKU. Once the data has been properly entered into the database, then every product must carry a sticker with a barcode. This will increase the performance of cash counter and organize the inventory in a better and proper form.

Point Of Sales Technology:

POS systems are part of every retail stores as well as Naheed. A Retail Point of Sales system typically includes a computer, monitor, cash drawer, receipt printer, customer display and a barcode scanner. Point of Sale Station Peripherals used at Naheeds are Cash Register Cash Drawer Point of Sale Software Point of Sale Terminal Receipt Printer Receipt Paper Point of Sale Keyboard MICR Check Reader

Point of Sale Monitor Credit Card Reader Signature Capture Pad Touch screen

Technologies which are under consideration at Naheed are RF Id Two way Radio Communication Enterprise-wide

Radio frequency inventory identification (RFID) tracks inventory using RFID tags. At Naheed, they dont use RF id yet but he said they are thinking about any technology which cam improve our service. A chip in the tag broadcasts a radio frequency signal that sensors located in the warehouse, store or factory can track. RFID technology can constantly monitor inventory in real-time. Two way Radio Communication are not used at Naheed although they are easy to implement. Retail sector in particular find the radio technology extremely useful as it allows workers on the shop floor to easily communicate with the distribution team to check stock levels. Enterprise-wide technology solutions have become more universal, thanks to the evolution of customer relationship management (CRM) and supply chain management (SCM). SCM solutions, which can often be integrated with CRM, are used to connect retailers to suppliers and partners to expedite inventory replenishment and other business transactions. PNG are working on implementing this system with Naheed. Our contact person also said that we are going to implement SAP in near future.