ACKNOWLEDGEMENT

I owe gems of words of thanks to my guide Mr. Naved Zarif (H R ManagerWALMAR !" . L #$ M%%R& 'RAN(H) for a**owing me to do my summer training under his kind and a+*e guidan,e. My efforts in a,,om-*ishing this -ro.e,t are a resu*t of ,onstant motivation and -atient *istening su--ort +y him. he know*edge -rovided +y him has +een a great va*ue addition for me and wi** go a *ong way in sha-ing our -romising ,areers. A*so I wou*d *ike to e/-ress my s-e,ia* thanks to a** the fa,u*ty mem+ers for their ,onstant he*- for the ,om-*etion of the -ro.e,t. heir ever avai*a+*e en,ouragement and en*ightening guidan,e has +een of immense he*towards the su,,essfu* ,om-*etion of the -ro.e,t. A+ove a**$ I wou*d *ike to e/-ress my dee- gratitude to my -arents$ friends 0 s-e,ia**y to my +rother for -roviding me the mora* su--ort without whi,h it was im-ossi+*e to ,om-*ete the -ro.e,t Any suggestion or o-inion in favor of this -ro.e,t re-ort wou*d +e kind*y a,,e-ted. R%%NA 1&! A

RETAIL MARKETING IN INDIA

TABLE OF CONTENTS
1. Industry Overview 05 2. Organized Retail Sector 10 3. Origin of retail 13 4. Indian Retail Industry 18 5. Retailing or!ats in India 23 ". S#ecialty stores 25 $. %a&or Industry 'layers 33 8. ()e growt) *rivers 44 +. Swot of t)e %ar,et 51 10. -)allenges 55 11. .ocation 'lanning 58 12. -o!#etitor /nalysis "5 13. uture Outloo, "8 14. %erger and /c0uisition $0

15. (ec)nology in retail $5 1". 1overn!ent initiatives and regulation $+ 1$. Researc) !et)odology 83 18. Researc) analysis 8" 1+. -onclusion 8+ 20. -onsu!er survey 0uestionnaire +0 21. References +4

Industry Overview

Industry analysis of t)e Indian retail sector2

Modern retailing has entered India in form of malls and huge complexes offering shopping, entertainment, leisure to the consumer as the retailers experiment with a variety of formats, from discount stores to supermarkets to hypermarkets to specialty chains. However, kiranas still continue to score over modern formats mostly due to the convenience factor i.e. near to their house. This organized segment typically comprises of a large number of retailers, greater enforcement of taxation mechanisms and better labour law monitoring system. It s no longer about !ust stocking and selling but about efficient supply chain management, developing vendor relationship "uality customer service, efficient merchandising and even the labour class is also in the working process timely promotional campaigns. The modern retail formats are encouraging development of well#established and efficient supply chains in each segment ensuring efficient movement of goods from farms to kitchens, which will result in huge savings for the farmers as well as for the nation. The government also stands to gain through more efficient collection of tax revenues. $etwork marketing has been

growing "uite fast and has a few large players today. %as stations are seeing action in the form of convenience stores, &TMs, food courts and pharmacies appearing in many outlets. In the coming years it can be said that the hypermarket route will emerge as the most preferred format for international retailers stepping into the country. 'stimates indicate that this sector will have the potential to absorb many more hypermarkets in the next four to five years

.ist of retailers t)at )ave co!e wit) new for!ats2

Retailer (hoppers) (top ,rossword shop /iramyd 0ood retail /antaloon Hypermarket -urrent or!at *epartment (tore -arge .ookstore 3ew or!ats +uasi#mall ,orner

*epartmental (tore

+uasi#mall,

1wn brand store

(ubhiksha (upermarket moving to self service %lobus fashion stores *epartment (tore

considering

(mall

Traditionally, the kirana retailing has been one of the easiest ways to generate self#employment, as it re"uired minimum investment in terms of land, labour and capital. These store are not affected by the modern format of retailing. In order to keep pace with the modern formats, kiranas have now started providing more value#added services like stocking ready to cook vegetables and other fresh produce. They also provide services like credit, phone service, home delivery etc. The organized retailing has helped in promoting several niche categories such as packaged fruit !uices, hair creams, fabric bleaches, shower gels, depilatory products and convenience and health foods, which are generally not found in the local kirana stores. -ooking at the vast opportunity in this sector, big players like 2eliance has announced its plans to become the country s largest modern retainers by establishing a chain of stores across all ma!or cities. &part from metro cities, several small towns like $agpur, $asik, &hmedabad, &urangabad, (holapur, 3olhapur and &mravati has seen the expansion of modern retails. (mall towns in Maharashtra are emerging as retail hubs for large chain stores like /antaloon 2etail because many small cities like $agpur have a student

population, lower real estate costs, fewer power cuts and lower levels of attrition. However, retailers need to ad!ust their product mix for smaller cities, as they tend to be more conservative than the metros. In order for the market to grow in modern retail, it is necessary that steps are taken for rewriting laws, restructuring the tax regime, accessing and developing new skills and investing significantly in India.

India is rated as t)e !ost attractive retail !ar,ets

-ountry Ris, -ountry 255

%ar,et /ttractiveness 255

%ar,et Saturation 305

(i!e 'ressure 205

Ran,

India
2ussia ,hina Turkey Thailand Malaysia 'gypt .razil India4s Ran,

"2
74 9; 7< 9= 86 7< 74 24t)

34
7; =6 79 =< =5 :7 79 14t)

+1
8< 7: 99 75 7; ;7 78 1st

80
54 56 97 8< =6 :6 46 $t)

1st
4nd 4t) 5 <4 <; 47 45 1st

Socio demographic factors will lead to faster growth of Organized retail in India:

<66> ;6> 96> =6> 46> 6>

5> <5> 47>

5> <5> 4=>

<6> 46> 4=>

<<> 44> 49>

<4> 4:> 48>

=8>

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=7>

=4>

:5>

<55< 6#<5 ?rs

<559 46#:= ?rs

466< :7#7= ?rs

4669 77@ ?rs

46<6'

'ntertainment *urable <6> <> Home :>

/harma 4>

0ood A %rocery <=>

,lothing and Textile :9>

Health A .eauty <> .ooks, Music A %ifts :>

Batch A Cewellery <8>

0ootwear <:>

ORGANIZ ! R "AI#

:;

Emerging Retail Markets:

India, 2ussia, ,hina and Dietnam top the list of the most attractive emerging markets for retailers investment in 4668, Bhile India and 2ussia have held the top two spots since 466=, ,hina s booming consumer spending, together with retailers moving into second#tier cities, helped it rise to $o. : from its $o. 7 spot last year, according to the 4668 %lobal 2etail *evelopment Index from management consultant firm &.T. 3earney. The study based its results on four variablesE country risk , measuring political risk, debt and credit ratingsF market attractiveness , encompassing retail sales per capita, population, infrastructure and regulationsF market saturation F and time pressure . The higher the ranking, the more urgency for retailers to enter the market, according to the study, which ranks the top :6 emerging countries for retail development and focuses on mass#merchant and food retailers. GIf you want to be an international player in retail, these are the markets that demonstrate the characteristics HwhereI you can be successful,G said -aura %urski, a co#author of the study and partner in &.T. 3earney s consumer and retail practice. India has already attracted the attention of global retailers like Bal# Mart (tores Inc., which is working with India s .harti 'nterprises to set up a !oint venture for a cash#and#carry business. In India, foreign multiple#brand retailers, which sell diverse brands under one roof, are limited to cash#and#carry and franchise or license operations. GIndia s window of opportunity continues to be wide for retail investment and development,G the report said. G1nce India s window closes for grocery retailers, there will be little opportunity for market domination in the main cities.G The country s growing population of young urban professionals with disposable incomes and the nouveau riche has also made India attractive for luxury retailers. India has attracted Gthe low end and the high end because of the breadth of the consumer segments that are available,G said %urski. Bhen variables stay constant, %urski said, do#it#yourself, apparel and electronics retailers usually enter emerging markets some two years after international grocers establish themselves. Middle 'astern countries are also represented on the list, with (audi &rabia ranking $o. <6 India has emerged as the world s most attractive destination for mass merchant and food retailing, maintaining its 4667 position in an annual study of retail investment attractiveness among :6 emerging markets. India was given the top ranking in management consulting company &T 3earney s 4669 %lobal 2etail *evelopment Index H%2*II. GThe Indian retail market is gradually but surely opening up, while ,hina s market becomes increasingly saturated,G said 0adi 0arra, a principal

::

in &T 3earney s ,onsumer Industries and 2etail /ractice and leader of the %2*I study. Much to the surprise of market observers, ,hina was ranked fifth in this year s tally, declining one more place since 4667. Bhile ,hina remains very attractive, the market is becoming increasingly saturate as and Jnited &rab 'mirates $o. <;. %ap Inc announced last week it had struck a deal with two franchisees to open %ap stores in (audi &rabia starting at the end of this year. *ubai has capitalized on consumer desire for a more Bestern lifestyle and has established itself as a retail mecca, %urski said. *espite its focus on luxury, *ubai is G!ust beginning to be populated by the bread#and#butter retailers of the Jnited (tates and the Bestern world,G she said. 2etailers that have already established a presence in ma!or ,hinese cities like (hanghai and .ei!ing, or those that have been slow to gain a foothold there, are now looking at less developed markets in second#tier cities, the study found. GIf the markets are saturated, they re looking to make profits in the second# tier cities,G %urski said. .ut she cautioned that a separate strategy is needed for the smaller markets since consumer tastes, ability to spend and willingness to embrace new formats may be different than in larger urban areas. International retailers rush to establish a presence and build market share, the study reveals. &ccording to the study, &sia with a large =6 per cent of the top 46 markets has surpassed 'astern 'urope as the dominant region for global retail expansion. GThe learning is that timing is the most important source of competitive advantage for global and regional retailers in the globalization race. 3nowing when to enter emerging retail markets is the key to success,G said 0arra. /owering &sia s charge are Dietnam, which has risen five places to third place, and countries like Thailand, (outh 3orea and Malaysia, all of which are in the top <7, &fter topping the ranking for two consecutive years in 466: and 466=, 2ussia slipped to second place behind India last year and remained there in 4669 too.

:2

Origin of Retail Sector

:3

Early Trade:
Bhen man started to cultivate and harvest the land, he would occasionally find himself with a surplus of goods. 1nce the needs of his family and local community were met, he would attempt to trade his goods for different goods produced elsewhere. Thus markets were formed. These early efforts to swap goods developed into more formal gatherings. Bhen a producer who had a surplus could not find another producer with suitable products to swap, he may have allowed others to owe him goods. Thus early credit terms would have been developed. This would have led to symbolic representations of such debts in the form of valuable items Hsuch as gemstones or beadsI, and eventually money.

6O7 R8(/I. *898.O'8*2

/eddlers and /roducersE
The 2etail Trade is rooted in two groups, the peddlers and producers. /eddlers tended to be opportunistic in their choice of stock and customer. They would purchase any goods that they thought they could sell for a profit. /roducers were interested in selling goods that they had produced.

1eneral Store2
This division continues to this day with some shops specializing in specific areas, reflecting their origins as outlets for producers Hsuch as /acific ,oncord of Hong 3ongI, and others providing a broad mix, known as %eneral (tore Hsuch as ,asey s in the Midwest of the

:4

J.(.&.I. &lthough specialist shops are still with us, over time, the general store has increasingly taken on specialist products. ,ustomers have found this to be more convenient than having to visit many shops # thus the term G,onvenience (toreG has also been applied to these shops. &s the popularity of general stores has grown, so has their size. This combined with the advent of (elf#(ervice has lead to the (upermarket, or (uperstore.

8arly %ar,ets2
1ver time, producers would have seen value in deliberately over# producing in order to profit from selling these goods. Merchants would also have begun to appear. They would travel from village to village, purchasing these goods and selling them for a profit. 1ver time, both producers and merchants, would regularly take their goods to one selling place in the centre of the community. Thus, regular markets appeared.The 0irst (hop E 'ventually, markets would become permanent fixtures i.e. shops. These shops along with the logistics re"uired to get the goods to them were, the start of the 2etail Trade.

()e :irt) of *istance Retailing2

*efined as sales of goods between two distant parties where the deliverer has no direct interest in the transaction, the earliest instances of distance retailing probably coincided with the first regular delivery or postal services. (uch services would have started in earnest once man had learned how to ride a camel, horse etc. Bhen individuals or groups left their community and settled elsewhere, some missed foodstuffs and other goods that were only available in their birthplace. They arranged for some of these goods to be sent to them. 1thers in their newly adopted community en!oyed these goods and demand grew. (imilarly, new settlers discovered goods in their new surroundings that they dispatched back to their birthplace, and once again, demand grew. This soon turned into a regular trade. &lthough such trading routes expanded mainly through the growth of traveling salesmen and then wholesalers, there were still instances where individuals purchased goods at long distance for their own use. & second reason that distance selling increased was through war. &s armies marched through territories, they laid down communication lines stretching from their home base to the front. &s well as garnering goods from whichever locality they found themselves in, they would have also taken advantage of the lines of communication to order goods from home.

Origins of Retail
It is likely that, as markets became more permanent fixtures they evolved into shops. &lthough advantageous in many respects, this removed the mobility that a peddler or traveling merchant may still have en!oyed. 0or some shopkeepers, it made sense to obtain extra stock and open up another shop, most probably operated by another family member. This would recover business from peddlers and create new business and the greater volume would allow the shopkeeper to strike a better deal with suppliers. Thus the retail chain would have started. Its thought that this process would have

:5

started in china over 4466 years ago with a chain of shops owned by a trader called -o 3ass.

()e irst Self;Service Store2

This all changed in <5<7 when &lbert %errard opened the %roceteria in -os &ngeles, the first documented self#service store. This was soon followed a year later by the /iggly BigglyK self#service store, founded by ,larence (aunders in Tennessee in the J.(.

1rowt)2
This new type of shopping was more efficient and many customers preferred it. &lthough personal service stores remain to this day, this new concept started a rapid growth of self#service stores in the Jnited (tates. 1ther countries were slow to take up the idea, but there has been a steady rise in the global amount of self#service stores ever since.

8fficiency
These entrepreneurs noticed that their staff had to spend a great deal of time taking grocery orders from customers. The groceries were stacked on shelves allowing customers to walk around and browse, collecting their shopping in a basket that was supplied. The shopkeeper would only need to tot up the final bill at the end of the process and transfer the goods from the basket to the customer and receive payment.

ro! a!ily :usiness to or!al Structure2

&lthough retail chains would have been mostly run by families, as some chains grew, they would have needed to employ people from outside of their family. This was a limiting factor as there would have been a limit to the amount of trusted non family members available to help run the chain. &nother, even more definite limiting factor was the distance the furthest shop would have been from the original shop. The greater the distance, the more time and effort would have been needed to effectively manage outpost shops and to service them with goods. There was, therefore, a natural barrier to expansion. That was the case until transport and communications became faster and more reliable. Bhen this happened towards the end of the <5th century, chains became much bigger and more widespread. Many of these businesses became more structured and formalized, leading to the retail chain that we see today.

:6

:7

:8

Indian Retail Industry

:9

<3OR1/3IS8* R8(/I. S8-(OR2

Today, retailing doesn)t involve !ust dealing or marketing from shops, it includes analyzing the market in an effort to provide reasonable prices together with an array of options and experience to customers. The sole purpose of all this is retaining the brand loyalty of customers. Indian retail is currently a J(L 4=7 billion market and is anticipated to extend to almost J(L :;7 billion mark by the next five years. The Indian retail sector is currently sporting a brand new look and together with a =9.9= per cent three#year ,ompounded &nnual %rowth 2ate H,&%2I, ,onventional marketplaces are paving way for new shopping malls, the likes of superstores, shopping plazas, supermarkets and brand label stores. International style shopping centers have started dotting the skyline of cities and smaller towns, ac"uainting the Indian customer to a uni"ue shopping experience. The retail industry in India is split up into the unorganized and organized retail segments. The unorganized retail sector includes the big, average and modest grocery stores and the chemist shops. & changeover is taking place from the conventional retail sector to organized retailing. .ut the unorganized segment still dominates and leads the industry. .y 46<6, the Indian retailing sector is anticipated to become an 2s<4.7 trillion market. The share of organized retailing is supposed to !ump to about <6 per cent from the existing three per cent. The anticipated staggering growth in organized retailing provides an opportunity to expand the market for both established and new players. &ccording to the latest report India 2etail (ector &nalysis H4669M68II by 2$,1(, the total retail market is primarily focused in rural regions, which makes up 77 per cent or J(L <97 billion of the overall retail market as opposed to urban segment, which represents =7 per cent or J(L <:7 billion of the gross retail market. The rural market is spread over 948,666 villages, even though its centre of attention is focused around a core group of <66,666 villages that makes up 76 per cent of the rural population.

India represents the most compelling international investment opportunity for mass merchant and food retailers looking to expand overseas, according to management consulting firm &T 3earney s 4667 %lobal 2etail *evelopment Index H%2*II, an annual study of retail investment attractiveness among :6 emerging markets. India is rated as the fifth largest emerging retail market and is seen as a potential goldmine. *riving global brands into India is the greatly improved investment climate due to the recent relaxation of direct ownership restrictions on foreign retailers. The country s retail market totals L::6 billion, is vastly underserved and has grown by <6 per cent on an average over the past five years. The message for retailers on India is clear N move now or forego prime locations and market positions that will soon become saturated. %lobal retailers that missed opportunities to capture first#mover advantage in ,hina will make up for it in India.

2;

Though India has more than five million retail outlets, they are greatly unorganized. There is no supply chain management perspective. In fact, out of the entire retail sector in India, the organized sector is only 47 per cent and the rest is unorganized. 59 per cent of the retail outlets are smaller in area than the standard norms. The retail industry is divided into organized and unorganized sectors. 1rganized retailing refers to trading activities undertaken by licensed retailers who are registered for sales tax and income tax. These include corporate backed hypermarket and retail chains and so on. Jnorganized retailing is the traditional low#cost shops, handcarts and pavements and is by far the prevalent form of trade in India. The efficiency of organized sector in retailing is manifested in some of the newer supermarkets in urbanOmetropolitan India N the produce is cleaner, fresher, well packed and often cheaper than the local shopkeeper. This is possible because of the far more efficient distribution system, which organized retail chains are employing, by cutting the layers of middlemen involved. There are other benefits too, of transforming the unorganized retail sector into an organized sector. 0irstly, a number of new !obs will be created, far better paid than the underage labor working in the local shops. (econdly, the benefits to the producer and consumer through better prices and lesser wastageF throwing up exportable surpluses, which will also benefit the economy as a whole. Thus one can see that allowing 0*I in retailing is beneficial to all the stakeholders involved

The .ig .azaars and (pencer)s, the huge unorganized retail sector is finally beginning to see the merit of logging on, even if at a model scale. Taxation policies also push you to automate and the push is even harder for those looking to expand beyond their single store existence. Though it)s early days yet to measure it penetration in the unorganized retail industry, interest levels are surely raising fast. PIt)s good to at least answer their "uestions. Though the interest is more with retailers who register good sales and volumes. (oftware available to the retailers is (hawMan)s 2etailMagi3, which takes care of the front#end store needs, as well as the back#end warehouse re"uirements. PIt would surely help the unorganized sector to get into technologies like bar#coding, which will make their operations more efficient. (ome other features are a user#defined billing screen and discount with control mechanism from the head# office, delivery order management, batch control and "uick information search, among others. The product is a simple to use. The screen design and the functionality are designed in such a way that the user need not press too many keys to get things done,Q says 3hushroo .agwadia, business development manager, (hawman (oftware. To begin with, most retailers look at decent entry#level solutions starting at 2s 47,666. However, there are cheaper "uick#fix solutions available too. 1ne can even deploy a computer and start with

2:

financial accounting programmers like Microsoft 'xcel, 0ox/ro and Tally. (mall retailers seem next in line and vendors are also warming up to the opportunity. &t the low#end however, smart inexpensive solutions are the need of the hour. &nd solutions providers like Microsoft, /olaris and (hawman are now working on developing smart tools for the retail enthusiasts. 0or small players with !ust one store, the investment on retail solutions go really low, anywhere between 2s <6,666 to 2s 47,666. Most of the time these solutions are developed by local firms, who at times compete with the big names in the industry. &ccording to 1beroi of /olaris, generally the mom#and#pop stores like to go for technology, which will get their work done at a reasonable cost. They avoid the high#end technology, and consider these as frills. PThey are not even bothered about upgrading, so the cheap systems are more than welcome. These solutions might not work for the mid#sized retailers with five stores, as then one need to scale it up and take care of inventory and supply chain management,Q he says. ,omparing the case with ,hina, Dedamani suggests India is on the right track. PIn ,hina, we find the organized sector to be 46#4:> of the total industry. Here, the technology has advanced in phases, and so is the case in India.

or!at

*escri#tion

()e 9alue 'ro#osition

.randed (tores

,omplete range available for a 'xclusive showrooms either owned or franchised out given brand, certified product by a manufacturer. "uality %reater choice to the consumer, 0ocus on a specific consumer need, carry most of comparison between brands is the brands available possible -arge stores having a wide variety of products, organized into different departments such as 1ne stop shop catering to variedO clothing, house wares, furniture, appliances, toys, consumer needs. etc.

(pecialty (tores

*epartment (tores

22

(upermarkets

'xtremely large self#service retail outlets

1ne stop shop catering to varied consumer needs

(tores offering discounts on the retail price through *iscount (tores selling high volumes and reaping economies of -ow /rices scale Hyper# mart -arger than a supermarket, sometimes with a -ow prices, vast choice available warehouse appearance, generally located in "uieter including services such as parts of the city cafeterias. (mall self#service formats located in crowded urban ,onvenient location and extended areas. operating hours. 'nclosure having different formats of in#store Dariety of shops available to each retailers, all under one roof. other.

,onvenience stores

(hopping Malls

Formats adopted by the Retail layers i! INDIA"

23

Retailer

Ori#i!al $ormats
<u-ermarket (=oodwor*d) #e-artment Megastore) <tore (!iramyd

Later Formats
Hy-ermarket (<-en,er>s)<-e,ia*ty <tore (Hea*th and 1*ow) #is,ount <tore ( ruMart)

R'1 Retail 'ira!al=s

'antaloon Retail #e-artment <tore (!anta*oon) > Ra)e&a 1rou# sto-) (ata? (rent .and!ar, 1rou# Ot)ers

<ma** format out*ets (<ho--e) <u-ermarket(=ood'AZAR) Hy-ermarket ('ig 'a?aar) Ma** ((entra*) #e-artment <tore (sho--er>s <-e,ia*ty <tore ((rossword) #e-artment <tore (Westside) #e-artment <tore (Lifesty*e)

<u-ermarket Hy-ermarket ( 'A) Hy-ermarket (<tar India 'a?aar) Hy-ermarket ( 'A)

#is,ount <tore (<u+hiksha$ Margin =ree$ A-na 'a?aar)$ <u-ermarket (Ni*giri>s)$ <-e,ia*ty %*e,troni,s

24

Retaili!# $ormats i! I!dia

1. %alls2 The largest form of organized retailing today. -ocated mainly in metro cities, in proximity to urban outskirts. 2anges from

25

96,666 s" ft to 8,66,666 s" ft and above. They lend an ideal shopping experience with an amalgamation of product, service and entertainment, all under a common roof. 'xamples include (hoppers (top, /yramid, /antaloon. 2. S#ecialty Stores2

,hains such as the .angalore based 3ids 3emp, the Mumbai books retailer ,rossword, 2/% s Music Borld and the Times %roup s music chain /lanet M, are focusing on specific market segments and have established themselves strongly in their sectors. 3. *iscount Stores2 &s the name suggests, discount stores or factory outlets, offer discounts on the M2/ through selling in bulk reaching economies of scale or excess stock left over at the season. The product category can range from a variety of perishableO non perishable goods. 4. *e#art!ent Stores2 -arge stores ranging from 46666#76666 s". ft, catering to a variety of consumer needs. 0urther classified into localized departments such as clothing, toys, home, groceries, etc 5. *e#art!ent Stores2

*epartmental (tores are expected to take over the apparel business from exclusive brand showrooms. &mong these, the biggest success is 3 2ahe!a s (hoppers (top, which started in Mumbai and now has more than seven large stores Hover :6,666 s". ftI across India and even has its own in store brand for clothes called (topR. ". 6y#er!arts?Su#er!ar,ets2

-arge self service outlets, catering to varied shopper needs are termed as (upermarkets. These are located in or near residential high streets. These stores today contribute to :6> of all food A grocery organized retail sales. (uper Markets can further be classified in to mini supermarkets typically <,666 s" ft to 4,666 s" ft and large supermarkets ranging from of :,766 s" ft to 7,666 s" ft. having a strong focus on food A grocery and personal sales. $. -onvenience Stores2

These are relatively small stores =66#4,666 s". feet located near residential areas. They stock a limited range of high# turnover convenience products and are usually open for extended periods during the day, seven days a week. /rices are slightly higher due to the convenience premium.

26

8.

%:O4s 2

Multi .rand outlets, also known as ,ategory 3illers, offer several brands across a single product category. These usually do well in busy market places and Metros.

S$ %IA#I"& S"OR S

27

ood retail 2
0ood dominates the shopping basket in India. The J(L 9.< billion Indian foods industry, which forms == per cent of the entire 0M,% sales, is growing at 5 per cent and has set the growth agenda for modern trade formats. (ince nearly 96 per cent of the average Indian grocery basket comprises non#branded items, the branded food industry is homing in on converting Indian consumers to branded food.

()e !o@ile revolution2

The retail market for mobile phones ## handset, airtime and accessories ## is already a J(L <9.8 billion business, growing at over 46 per cent per year. In comparison, the consumer electronics and appliance market is worth J(L 7.9 billion, with a growth rate that is half of the mobile market.

>ids retail2
Bhen it comes to Indian children, retailers are busy bonding##and brandingE Monalisa, the Dersace of kids is coming to India. %lobal lifestyle brand $autica is bringing $autica 3ids. International brand Sapp tied up with 2aymond to foray into kids apparel. *isney launched exclusive chains which stock character# based stationery. /antaloon s !oint venture with %ini A Cony will set up a retail chain to market kids apparel. (wiss kidswear brand Milou is collaborating with Tirupur# based (ree!a Hosieries. Turner International India /vt -td. will launch ,artoon $etwork Townsville and /lanet /1%1##two theme parks designed around its channels##in the $ational ,apital 2egion. (ahara 1ne Television has also signed a Memorandum of Jnderstanding to source content from (pacetoon Media %roup, Middle 'ast s largest kids entertainment brand for animation and live action content. -eading the kids retail revolution is the apparel business, which accounts for almost ;6 per cent of the revenue, with kids clothing in India following international fashion trends. &ccording to research

28

firm 3(& Technopak, the branded segment comprises J(L 86<.8 million of the total kids apparel market#size of over J(L : billion. Industry experts say kids retailing will touch annual growth of :6#:7 per cent. Toys, stationary, sportswear, outerwear, tailored clothing, eyewear, watches, fragrance, footwear, theme parks, TD channelsT the segment is growing rapidly at <6 per cent per annum. Margins are in the range of 46#47 per cent Hfor dealers and distributorsI, while companies en!oy an average gross margin of about <6 per cent.

/gricultural retail2
&griculture across India is heralding the country s second %reen 2evolution. <= states, including Maharashtra, /un!ab, &ndhra /radesh and 2a!asthan amended the &gricultural /roduce Marketing ,ommittee H&/M,I act this year, along the lines of the Model &/M, &ct, 64, which allows farmers to sell their produce directly to buyers offering them the best price. &gricultural sectors such as horticulture, floriculture, development of seeds, animal husbandry, pisciculture, a"ua culture, cultivation of vegetables, mushroom under cultivated conditions and services related to agro and allied sectors are open to <66 per cent 0*I through the automatic route. 0or its e#,houpal scheme, IT, built internet kiosks in rural villages so farmers can access latest information on weather, current market prices, foods#in#demand, etc. Bith a J(L 7.9 billion, multi#year investment in agriculture and retail, 2eliance 2etail will establish links with farms on several thousand acres in /un!ab, Best .engal and Maharashtra. 0ield0resh, planning to become India s first large#scale exporter of produce, will annually pay farmers over J(L :6,666 to lease land for vegetables, to hire tractors and to pay their workers. .esides a five#year program with the /un!ab government to provide several hundred farmers with four million sweet#orange trees for its Tropicana !uices by 466;, /epsi,o##with agriculture exports worth J(L =6 million##also introduced farmers to high#yielding basmati rice, mangoes, potatoes, chilies, peanuts, and barley for its 0rito#-ay snacks. 'xport potential and a rapidly growing domestic demand for reliable produce from new supermarket chains is driving change. Bith 88 per cent of India s population relying on agriculture for a living, improved efficiency and new markets can benefit a large number of people.

International retailers 2
The &ustralian government s $ational 0ood Industry (trategy and &ustrade initiated a test marketing food retail in India wherein <4 ma!or &ustralian food producers have tied up with India#based distributor &. Mauri to sell their products directly at retail outlets. The largest#ever <76#member .ritish business delegation in India committed investments in the areas of food processing, agri retail

29

and manufacturing. It is also likely to press for the liberalisation of sectors like financial A legal services and retail. J(#based home delivery and logistics company, (pecialised Transportation Inc, will enter the Indian market through a strategic alliance with /atel 2etail, a subsidiary of /atel Integrated -ogistics. &mong other big international players, Bal#Mart has announced its plans for India in partnership with .harti, Tesco is sure to try again, and ,arrefour too might finally find the right partner.

3;

Su#er!ar,ets2
-arge self service outlets, catering to varied shopper needs are termed as (upermarkets. These are located in or near residential high streets. These stores today contribute to :6> of all food A grocery organized retail sales. (uper Markets can further be classified in to mini supermarkets typically <,666 s" ft to 4,666 s" ft and large supermarkets ranging from of :,766 s" ft to 7,666 s" ft. having a strong focus on food A grocery and personal sales. (upermarkets are relatively new entrants in the market. They are so called pioneers in organized food retailing and go by the western model in look and feel and format. This is what everybody means when they say organized food retailing.

ranc)ise outlets2
-ike Tommy Hilfiger and Bal Mart, other J( retailers are firming up their India entry strategies and if they are already in, they are undergoing rapid expansion. 0ashion brands *3$? is also al set to foray into the Indian fashion Industry through a franchisee agreement with Indian company, (. 3umar (tarbucks recently expressed their interest in entering Indian company

-ike Tommy Hilfiger and Bal#Mart, other J( retailers are firming up their India entry strategies and if they are already in, they are undergoing rapid expansion. 0ashion brand *3$? is also all set to foray into the Indian fashion Industry through a franchisee agreement with Indian company, ( 3umar)s.(tarbucks recently expressed their interest in entering India through the franchise route, like their &merican0A. counterparts /izza Hut, (ubway, and the very successful Mc*onald)s. Mc*onald)s has ma!or expansion plans lined upF in the next : years, it plans to open another <66 outlets in cities across India.

6y#er!ar,et2
& very large commercial establishment that is a combination of departmental store and a supermarket. The specific features of a hypermarket are the wide range of goods offered, "uality service, "uality display of goods on the shelves and complex systems providing for customers loyalty. Hypermarket is known for a wide range of goods offered. It consist of dozens of thousands of items, while similar goods can be offered in several forms. In order to work with such an assortment it is necessary to group it into categories and sub categories that would unite goods according to this or that criteria.

S)o##ing %alls2 3:

The new shopping malls that have been expanding their footprint across Indian cities are well designed, built on international formats of retailing and integrated with entertainment and restaurants to provide a complete family experience. 1ver :66 malls are expected to be built over the next two years and most Indian cities with over a million populations will be exposed to this modern method of retailing.

(hopping malls have existed in India since several decades but were designed and built to house several shops in a single facility. These malls also known as (hopping &rcades offered only rows of shops, most of which were small stores that promised bargains for their various wares. These (hopping &rcades tried to maximize on their store space and did not offer any areas for recreation and entertainment.

The present day malls are a creation of the past few years post 4666. They are designed professionally using a lot of international experience and combine shopping with a lot of brand building, recreation, food and entertainment. Malls also have a large format store that serves as their anchor for shopping and a prominent restaurant that anchors the food needs of visitors. Most malls also feature a multiplex cinema that offers entertainment to the visitors of the mall. 0inally the mall has large atria and open spaces to allow visitors and families to hang#out.

32

Organized Sector

Retail

33

'roduct Seg!ents2
The organized retail business in India is very small. This is despite the fact that India is one of the biggest markets. 2etail business contributes around <6#<< per cent of %*/. India also has the largest number of retailers, about <4 million, though they are mostly small. Most of the organized retailing in the country has !ust started recently, and has been concentrated mainly in the metro cities. 1rganized retailing in India has a huge scope because of the vast market and the growing consciousness of the consumer about product "uality and services. 1rganized retail only accounts for :> of the total retail industry as yet and is estimated to grow to L9= billion by the year 46<7. &s a result, the retailing space in the country will also rise by <7#46> by 46<6. 76 million s" ft of "uality space under development 8 ma!or cities to account for =< million s" ft development :66 malls, shopping centre and multiplexes under construction To open :7 hypermarkets, :47 large department stores, <766 supermarkets and over <6,666 new outlets To add J( L <6 billion of business to organized retail. &((1,H&M president, &nil 3 &garwal saysEQ The organized sector retailing is all set to grow at much faster speed than unorganized sector and the higher growth speed will alone be responsible for its higher market share which has been pro!ected for L<8 billion by 46<6#<<. ,ities and metropolis in which retailing will show booming prospects include Mumbai, *elhi, ,hennai, 3olkata, .angalore and 3anpur, said &garwal adding that the popular mode adopted for building shopping malls in these cities will be based on build, operate, lease and sell basisG. The = ma!or organized retail sectors are 0ood A %rocery, ,lothing, ,onsumer *urables and .ooks A Music. In 466:#6=, private consumption expenditure in India amounted to 2s <,956,666 crores HJ(* :87 billionI of which, retail sales constitute about 9<> HJ(* 4:6 billionI.In terms of penetration by the organized retail sector, footwear is the highest category, followed by clothing. 0ootwear is driven by the dominance of home Ngrown players like -iberty as well as the <7> market share that M$, retailer .ata ,ommands. 0oreign /resence, especially through the franchisee route, e.g. &didas, 2eebok, $ike etc. adds to this slice of the pie.

34

0ranchisee activity in this category, especially in Tier II ,ities, is pegged to rise.

stimated Growth in Organized Retail

35

2004 -arge (egments 1ther (egments <,54= <,:<7

200+ 7,64= 4,9=7 =44 ;,65<

-/1R A5B 4<> <7> <4> <;>

$on#store 4:5 2etailing Total 1rganized :,=8; retail ()e our .arge Seg!ents2 0ood #,hain (tores #(ingle -arge (tores ,lothing #Manufacturer retailers #,hain stores #(ingle -arge (tores ,onsumer durables # Manufacturer retailers #,hain stores #(ingle -arge (tores .ook and Music #,hain (tores #(ingle -arge (tores :5< :49 97 <,687 45: :<7 =98

<,94= <,=94 <94 4,499 756 ;74 ;4=

::> :7> 46> <9> <7> 44> <4>

:75 <=< 5; <46

;44 4;= 45; 4=6

<;> <7> 47> <7>

58 7= =:

:<6 464 <6;

49> :6> 46>

36

Retail is a!ongst t)e fastest growing sectors in t)e country. Indiaran,s irstC a)ead of RussiaC in ter!s of e!erging !ar,ets #otential in retail and is dee!ed a D'riority4 !ar,et for International retail.

Ma%or I!d&stry layers

37

$anz in $orth India, $ilgiris in the (outh, /antaloon in the 'ast and ,rossroad in the Best were the pioneers of the retail revolution in India. $anz faced several obstacles in their business and had to finally down their shutters. $ilgiris, due to some strange reason, did not see any logic to expand beyond the southern frontiers. /antaloon went to scale up and become bigger and bigger to form the 0uture %roup, that is now omnipresent in almost all formats right from small groceries to e#tailing. ,rossroads in Mumbai imparted some valuable lessons to their parent, the /iramyd %roup, who has since then gone on an expansion drive with other formats of retailing in different cities. The big players in Indian retail landscape now are the 0uture %roup, (hoppers (top, Bestside, (ubiksha and 2/% (pencer. The newcomers who are knocking at the gates are 2eliance 2etail, .harti Balmart and &ditya .irla Trinethra. Here, we intend to do a brief profiling of the ma!or players in order to understand the retail business in a better manner. 1 The Future Group

The 0uture %roup, which was earlier known as /2I- H/antaloon 2etail India -imitedI began as a trouser manufacturer in the mid <5;6s. The 0uture %roup is divided into six verticals N 0uture 2etail, 0uture ,apital, 0uture .rands, 0uture (pace, 0uture Media and 0uture -ogistics. The 0uture %roup started operations in the mid <5;8s by incorporating the company as Manz Bear /rivate -imited. The company went on to manufacture ready made trousers under the P/antaloonsQ brand name. It came out with a public issue in <55< and later changed their name to /antaloon 0ashions HIndiaI -imited H/0I-I.

38

The first exclusive men)s store called /antaloon (hoppe was inaugurated in <554. /antaloons went for a franchisee route to expand the number of retail outlets and by <557, it had reached to a crucial number of 86. The first departmental store called /antaloons was opened in 3olkata in <558 with an investment of 2s 6.8 million. The store was a success and recorded revenues of 2s <66 million within the first year of operations. In <555, the company)s name was changed to /antaloon 2etail HIndiaI -imited H/2I-I. The success of /antaloons departmental stores encouraged /2I- to come up with other retailing formats such as P.ig .azaarQ to retail low cost general merchandising, and P0ood .azaarQ to retail food products. &s of 4667, the 0uture %roup has :.7 million s" ft of retail space and over <66 stores across 47 cities in India. It employs more than <4,666 people and has a customer base of more than <46 million. 3ishore .iyani, the promoter of the group who likes to address himself as P,hief 3nowledge 1fficerQ has plans to launch <; formats and over :,:=6 stores, thereby turning the 0uture %roup into a J(L8 billion company with over J(L< billion in profits by the year 46<6.

Shoppers Stop

(hoppers) (top, promoted by the real estate group 3 2ahe!a, was one of the first movers to have set up a large retail outlet in $ew *elhi with international ambience. (hopper)s (top -td now has a considerable presence all over the country with overr 8 lakh s"uare feet of retail space and stocks over 466 brands of garments and accessories. The stores are spread all over India with presence in Mumbai, *elhi, .angalore, Hyderabad, Caipur, /une , 3olkata, %urgaon, ,hennai A %haziabad. (hoppers) (top is also very well known for having pioneered several "uality retailing concepts in India like ,21((B12*, Hyper,IT? and Mothercare. They are the only retailer from India to become a member of the prestigious Intercontinental %roup of *epartmental (tores HI%*(I.

39

(hoppers) (top is positioned as a family store delivering a complete shopping experience. Bith its wide range of merchandise, exclusive shop#in#shop counters of international brands and world#class customer service, (hoppers) (top brought international standards of shopping to the Indian consumer providing them with a world class shopping experience. (hoppers) (top)s core customers represent a strong (', & skew. They fall between the age group of <9 years to :7 years, the ma!ority of them being families and young couples with a monthly household income above 2s. 46,666O# and an annual spend of 2s.<,76,666O#. & large number of $on # 2esident Indians visit the shop for ethnic clothes in the international environment they are accustomed to.

The stores offer a complete range of apparel and lifestyle accessories for the entire family. 0rom apparel brands like /rovogue, ,olor /lus, &rrow, -evi)s, (cullers, Sodiac to cosmetic brands like -akme, ,hambor, -e Teint 2icci etc., (hoppers) (top caters to almost every lifestyle need. (hoppers (top also retails its own line of clothing namely (top, -ife , 3ashish, Dettorio 0ratini and *I?. The merchandise at (hoppers) (top is sold at a "uality and price assurance backed by its guarantee stamp on every bill. (hoppers) (top)s customer loyalty program is called PThe 0irst ,itizenQ. The program offers its members an opportunity to collect points and avail of innumerable special benefits. ,urrently, (hoppers) (top has a database of over 4.7 lakh members who contribute to nearly 76> of the total sales of (hoppers) (top. The 1rganisation, in 4666, along with I,I,I ventures also ac"uired the reputed bookstore, P,rosswordQ, which offers the widest range of books along with ,*#21M, music, stationery and toys. (ervices like *ial#a#book, 0ax#a#book and 'mail#a#book enable customers to shop from their homes. ,rossword currently has <; (tores. 2ealising the role of IT way back in <55<, (hoppers) (top was among the first few retailers to use scanners and barcodes and completely computerise its operations. Today it is one of the few stores in India to have retail '2/ in place, which is now being integrated with 1racle 0inancials and the &rthur /lanning (ystem, the best retail planning system in the world. Bith the help of the '2/, they are able to replicate stores, open new stores faster and get information about merchandise and customers online, which reduces the turnaround time in taking "uick decision.

4;

(hoppers (top has been very keen to understand the importance of distribution and logistics in ensuring that merchandise is available on the shop floors. This has led the retail chain o streamline its supply chain. The company has developed process manuals for each part of the logistics chain. These modules include vendor management, purchase order management, stock receiving systems, purchase verification and inventory build up, generation and fixing of price and store tags, dispatch of stocks to the retail floor and forwarding of bills for payment. (hoppers) (top has a grand ambition to position itself as a global retailer. The company intends to bring the world)s best retail technology, retail practices and sales to India. ,urrently, they are adding = to 7 new stores every year.

Trent Westside

'stablished in <55;, Trent operates some of the nation s largest and fastest growing retail store chains. & beginning was made in <55; with Bestside, a lifestyle retail chain, which was followed up in 466= with (tar India .azaar, a hypermarket with a large assortment of products at the lowest prices. In 4667, it ac"uired -andmark, India s largest book and music retailer. In a recently signed deal, Trent has agreed to anchor <4 malls set up by *-0 Jniversal -td across the country, at its Bestside, -andmark and (tar India .azaar outlets. This amounts to about 48 locations, totaling to about a million s"uare feet of space. Trent retails garments and household accessories for men, women and children, cosmetics and perfumes at Bestside, food, beverages, health and beauty products, vegetables, fruits, dairy products, consumer electronics and household items at (tar India .azaar and books, music and stationery at -andmark. Bestside has 47 outlets across <8 cities in India offering a variety of designs and styles in garments, footwear and accessories, as table linens, artifacts, home accessories and furnishings. Bell#designed interiors, sprawling space, prime locations and coffee shops enhance the customers shopping experience. Trent also runs another chain of retail stores called (tar India .azaar. -aunched in 466=, (tar India .azaar provides a large assortment of high "uality products made available at the lowest prices coupled with a uni"ue shopping experience. (tar India .azaar is located in &hmedabad and offers a wide choice of staple food, beverages, health and beauty products, vegetables, fruits, dairy products, consumer electronics and household items at the most affordable prices. Trent has also recently ac"uired a 89 per cent stake in -andmark, one of the largest books and music retail chains in India. -andmark commenced its operations in <5;8 with its first store in ,hennai, and now has nine stores in the ma!or metros of the country. 'arlier -andmark was focused on books, stationery and greeting cards. In <559 it added music to its product portfolio and also started the trend of stocking curios, toys, music, ,*s and other gift items.

4:

4. Piramyd /iramyd 2etail is part of the /iramal %roup, which has presence in diverse sectors spanning /harmaceuticals, Textiles, 2eal 'state, 'ngineering, 0amily 'ntertainment and 2etail with manufacturing operations in <5 locations across five states and employing over <;,666 people. The promoters launched the apparel business in <555 under /iramyd 2etail and Merchandising /vt. -td. H/2M/-I while its foodF home A personal care businesses H0H/,I were housed under ,rossroads (hoppertainment /vt. -td. H,(/-I. &s the apparel and food businesses individually reached a critical mass the management merged the two companies into /iramyd 2etail -td. due to distant synergies in two businesses in March 4667. /yramid also has a smaller format of stores called TruMart that caters to 0ood and /ersonal ,are products. /iramyd 2etail currently has 7 Mega stores and ; TruMart stores mainly in Maharashtra . The company plans to increase these numbers to <8 Mega stores and 95 TruMarts by 466;. The floor space is expected to be 7 times on successful expansion. The 0H/, H0ood A /ersonal ,areI business is volume driven while the -ifestyle store is a margin driven business. /iramyd 2etail plans to increase the contribution of private labels from existing 8> to <;# 46> of the revenues by 46<6. %ross margins from private labels are over =6> and hence the company is planning to increase this business. Most of the stores are on the lease format and the company is prone to higher lease rentals due to the overall increase in real estate prices. This may bring the profit levels down substantially. /iramyd 2etail did have a first mover advantage in many locations but it has actually failed to capitalise over this advantage. Its competitors like /antaloon, (hoppers (top and Trent gained larger benefits of their far more aggressive business A marketing strategy in the retail space.

42

5.

Su@i,s)a

The ,hennai based (ubiksha grocery chain runs around 466 outlets all over the country and it)s current turnover stands at 2s 44= crores. Their target customer is the middle income value conscious buyers. The main aim of (ubiksha is to offer a functional and transactional shopping experience. This retail chain has no "ualms and spends almost no money on creating a pleasant shopping experience, and all stores are non#air conditioned. There is no false roofing or sparkling vitrified tiles on the floor. & few years ago, (ubiksha did not even offer shoppers self service. The customer had to place an order at a computerized teller and the goods were billed and delivered after cash is collected. ,ustomers had to bring their own carrybags or pay to buy them from the store. (ubiksha even attempted to charge the customers for home delivery. However, now (ubiksha has slightly tweaked their business model in order to create a better appeal to customers who were defecting to the competitors. The store formats are still small and non# airconditioned. .ut customers have the option to pick from shelf spaces. They also get shopping bags and free home delivery. .ut the selling J(/Huni"ue selling propositionI remains the same ### (ubiksha tries to be as close to the customer as possible and offers the lowest price and huge savings in comparison to competitors. It)s slogan happens to be ### b achat mera adhikar hain Hsaving is my fundamental rightI.

".

R'1 S#encer

43

2/%)s (pencer presently has <47 stores across 47 cities covering a retail trading area of half a million s"uare feet and with a clientele of : million customers a month. (pencer s has a national footprint with seven hypermarkets, three supermarkets and 86 daily use outlets, called *ailies. &ll the newly opened (pencer s stores stock every conceivable product that is re"uired by a household on a daily basis. &t (pencer s *aily shoppers can get fresh fruits, vegetables, fast# moving consumer goods, household items, groceries, with regular offers and discounts. (pencer s outlets are divided in to three retail formats. These are, (pencer s Hyper, the over 47,666#s" ft hypermarkets stocking over 47,666 items. The ;,666s" ft to <7,666#s" ft mini hyper stores, branded as (pencer s (uper and the daily purchase =,666#s" ft to 8,666#s" ft (pencer s *aily for groceries, fresh food, chilled and frozen products, bakery and weekly top up shopping.

$.

Reliance Retail

44

1n Cune 49, 4669, Mukesh &mbani, ,hairman and Managing *irector, 2eliance Industries -imited, announced a 2s 47,666#crore investment in the retail sector. 2eliance 2etail started it)s retail operation with P2eliance 0reshQ, a grocery store that sells vegetables, fruits, personal care items and other food products. (oon, these retail outlets will also be selling apparel and footwear, lifestyle and home improvement products, electronic goods and farm implements and inputs. They will also offer products and services in energy, travel, health and entertainment. In addition to this, partnerships would be developed to bring the best of global luxury brands to India as well. 2eliance 2etail plans to extend it)s footprint to cover <,766 Indian cities and towns with outlets of a varied format, a mix of neighborhood convenience stores, supermarkets, specialty stores and hypermarkets. 2eliance also plans to open restaurant outlets, financial services marts and tourism counters within it)s stores. Mukesh &mbani)s ultimate ambition seems to be to create the Indian e"uivalent of Bal#Mart by scaling up the business to unprecedented heights to reach every nook and corner of the country. Bith it)s retailing venture, 2eliance expected a revenue target of J( L46 billion through it)s retail operations by 46<6. 1ver a span of five years, 22- expects a 46> return#on#investment. The first store christened P2eliance 0reshQ opened in $ovember 4669 at Hyderabad. Bithin a few months they have now opened stores in Mumbai, /une and &hmedabad and plans foray into other cities on a rapid scale.

45

8.

:)arti 7al;%art

.harti 2etail H/vt.I -td. unveiled the roadmap for its retail venture on <5 th 0ebruary, 4668 envisaging an investment of L4.7 billion with expectation of revenue of L=.7 billion Habout 2s. 46,666 croreI from this business by 46<7. The first retail outlet is expected to open somewhere in the month of &ugust . .harti)s plan is to invest L4.7 billion by 46<7 and open stores across all ma!or cities. This investment would be only for setting up front# end stores. The modalities for its back#end linkage, including its !oint venture with the world s largest retailer Bal#Mart, are in the process of being worked out. & high#level team from Bal#Mart was visited India in the later part of 0ebruary to work out the details of the back#end chain. Bhile .harti would manage front#end of the retail venture, Bal#Mart would be involved in the back#end, including logistics, supply chain and cash# and#carry, he added. The CD was presently scouting for <6 million s". ft. of retail space, which would include hypermarkets, supermarkets and convenience stores and would provide employment to about 96,666 people. The company would open multi#format retail outlets in all cities with a population of about one million. .harti is now conducting a massive consumer survey to take a final decision on branding and promotional campaign.

46

However, .harti and Bal#Mart have been facing stiff opposition from the left parties and other political outfits who fear that the entry of the .entonville giant will make life difficult for the small grocers and create massive unemployment. They also expect Bal#Mart to take a tough stance on lowering prices and force farmers to sell their produce at lower rates. & lurking fear of monopolistic regime in the retail sector is also enhancing their fears. .oth .harti and Balmart are presently having a tough time in convincing the ministers, politicians, agriculturists, the $%1s and other pressure groups that their business model would serve to work in the best interests of all the stakeholders.

+.

/ditya :irla E %OR8

The &ditya .irla %roup is India s first truly multinational corporation. %lobal in vision, rooted in values, the %roup is driven by a performance ethic pegged on value creation for its multiple stakeholders. & J(L 4= billion conglomerate, with a market capitalization of J(L 4: billion and in the -eague of 0ortune 766, it is anchored by an extraordinary force of <66,666 employees belonging to over 47 different nationalities. 1ver 76 per cent of its revenues flow from its operations across the world.Q 1ur mission is to change the way people shop. Be will give them more.Q says Mr. 3umar Mangalam .irla, ,hairman, &ditya .irla %roup. The more. for you advantageE more. promises a world#class pleasurable shopping experience to Indian consumers in their very own neighborhood. more. +uality, more. variety, more. convenience and more. value are the four delivery cornerstones of the more. chain of supermarket stores. more. M12'. Dalue M12'. promises best in market pricing. -inking up directly with farmers to source fresh fruits, vegetables and staples ensure great "uality as well as great price. &dd to this, the membership program ,lub more. which provides convenience,

47

customized shopping solutions and savings, and the more. value promise becomes all the more evident. More. Is an inspirational brand for an inspirational country. Be have a bright and committed, enthusiastic team that represents the best experience from India and globally. M12'. also has a range of products from its own stable available across value, premium and select ranges. The products have been "uality#checked and are available in attractive packaging at competitive prices. To avail additional benefits, at no extra charge, customers can also enroll for the membership program ,lub more.

10. 9IS6/. R8(/I. 2

9is)al is one of fastest growing retailing groups in India. Its outlets cater to almost all price ranges. The showrooms have over 86,66 products range which fulfills all your household needs, and can be catered to under one roof. It is covering about <4;4666 s". ft. in <; state across India. 'ach store gives you international "uality goods and prices hard to match. The cost benefits that is derived from the large central purchase of goods and services is passed on to the consumer. Bhat started as a humble one store enterprise in <5;9 in 3olkataHerstwhile, ,alcuttaI is today a conglomerate encompassing 51 showrooms in 3+ cities. India)s first hyper#market has also been opened for the Indian consumer by Dishal. (ituated in the national capital *elhi this store boasts of the singe largest collection of goods and commodities sold under one roof in India. The group)s prime focus is on retailing.

48

The 9is)al stores offer affordable family fashion at prices to suit every pocket. The group)s philosophy is integration and towards this end has initiated backward integration in the field of high fashion by setting up a state of the art manufacturing facility to support its retail endeavors. ,ompany has already tied up for 7#lakh s" ft space and is looking for more. ,ompany will come up with :4 new stores this year. ,ompany is doing research on more formats. ,ompany is looking for opportunities of expansion in the (outh. ,ontribution of apparels business at 7:> may slightly come down to 76>. India is a big country and there is huge space for four#five big retail players. Dishal can always sustain growth in this big market. ,ompany can sustain margins as it is going for backward integration. ,urrently manufacturing contributes <6> of the business, which in the next two to three years, will go up to 47>. ,ompany is increasing its focus on the non#apparel and 0M,% segment. The current share of 0M,% at <7> could go up to 46#47>. &pparel sales currently at 9:> in the next 4#: years should come down to 76> as the company is now also focusing on different segments. Bith growth in volumes, the cost of sourcing will come down in the near future. ,ompany will venture wherever it gets real estate space. ,urrently, it has very little space in the south India. 'ventually, it will have a pan# India set up.

11. %8(RO E -/S6 F -/RRG I3*I/

M'T21 %roup today, is the third largest trading and retailing group in the world. The company employs over 4,76,666 staff in :6 countries. In the year 4667 M'T21 %roup had generated sales of over U77.8 billionF 7:> of total sales came from outside %ermany. M'T21 ,ash A ,arry started operations in India in 466: with two

49

*istribution ,entres in .angalore. Bith this M'T21 introduced the concept of ,ash A ,arry to India. These ,entres offer the benefit of "uality products at the best wholesale price to over <76,666 businesses in .angalore. M'T21 offers assortment of over <;666 articles across food and non food at the best wholesale prices to business customers such as Hotels, 2estaurants, ,aterers, 0ood and $on#food Traders, Institutional buyers and professionals. M'T21 s ,ash A ,arry business model is based on a .usiness to .usiness H.4.I concept and focuses on meeting all the needs and re"uirements of business customers. It is a modern format of wholesale trading, catering only to business customers.

12. 9ive,s; ()e <nli!ited S)o#

Divek -imited is a professionally managed public limited company carrying three retail brands # Diveks, Cainsons, /remier and continuously adding to the formidable strength of <666 employees. Divek -td is the largest consumer electronics A home appliances retail chain in India. Diveks popularized several brands by creating visibility and have the distinction of being market leaders and trendsetters with continuous support from the principal companies. Diveks evolved its strategies to suit the larger scene where there was a stigma attached to borrowing. Dery few hire purchase options were available and hence Diveks started Divek Hire /urchase and -easing -td to finance consumer durables, which enhanced the core retailing business also.Diveks grew from : stores to more than 74 stores and turnover increased to over 2s. :76 crores HJ(* ;6 millionI and also become a public limited company from a family run enterprise. In this process, <= store Cainsons was bought over in <555, 4 store /remier in 466< and (pencers in 4664 and have recently absorbed (pencers into the /remier brand. Bith the liberalization of economy and other

5;

changes in the global scene, Diveks streamlined the marketing and advertising activities and shopping ambience was improved.

T'E GRO(T' DRI)ERS

5:

*rivers of Retail Industry

The *emography *ynamicsE &pproximately 96 per cent of

Indian population below :6 years of age. *ouble IncomesE Increasing instances of *ouble Incomes in most families coupled with the rise in spending power. /lastic 2evolutionE Increasing use of credit cards for categories relating to &pparel, ,onsumer *urable %oods, 0ood and %rocery etc. JrbanizationE increased urbanization has led to higher customer density areas thus enabling retailers to use lesser number of stores to target the same number of customers. &ggregation of demand that occurs due to urbanization helps a retailer in reaping the economies of scale. ,overing distances has become easierE with increased automobile penetration and an overall improvement in the transportation infrastructure, covering distances has become easier than before. $ow a customer can travel miles to reach a particular shop, if he or she sees value in shopping from a particular location.

*RI98RS OR 1RO7(62

Indian consumers are rapidly evolving and accepting modern formats overwhelmingly. 2etail (pace is no more a constraint for growth. India is on the radar of %lobal 2etailers and suppliers O brands world# wide are willing to partner with retailers here. 0urther, large Indian corporate groups like Tata, 2eliance, 2ahe!a, IT,, .ombay *yeing, Murugappa A /iramal %roups etc and also foreign investors and private e"uity players are firming up plans to identify investment opportunities in the Indian retail sector. The "uantum of investments is likely to sky#rocket as the inherent attractiveness of the segment lures more and more investors to earn large profits. Investments into the sector are estimated at I$2 46 N 47 billion in the next 4#: years, and over I$2 466 billion by end of 46<6. (tocks in the retail sector are also becoming increasingly attractive from an investor s point of view. (uccessful development of value based concepts as well as development of retail space in smaller cities and towns shall drive the organized retail into the next levels of cities. 2etailers have responded to this phenomenon by introducing contemporary retail formats such as hypermarkets and supermarkets

52

in the new pockets of growth. /rominent Vtier#II cities and towns which are witnessing a pick#up in activity include (urat, -ucknow, *ehra *un, Di!aywada, .hopal, Indore, Dadodara, ,oimbatore, $asik, .hubaneswar, Daranasi and -udhiana among others. Bith consumption in metros already being exploited, manufacturers and retailers of products such as personal computers, mobile phones, automobiles, consumer durables, financial services etc are increasingly targeting consumers in tier II cities and towns. In addition, petro#retailing efforts of petroleum giants scattered through out the country s landscape have also ensured that smaller towns are also exposed to modern retailing formats. 1n the supply side, mall development activity in the small towns is also picking up at a rapid pace, thereby, creating "uality space for retailers to fulfill their aggressive expansion plans. Thus, the Vretail boom , ;7> of which has so far been concentrated in the metros is beginning to percolate down to smaller cities and towns. The contribution of these tier#II cities to total organized retailing sales is expected to grow to 46#47>.

1RO7I31 -O3S<%8R -./SS2 0avorable demographic and psychographic changes relating to India s consumer class, international exposure, availability of increasing "uality retail space, wider availability of products and brand communication are some of the factors that are driving the retail in India. 1ver the last few years, many international retailers have entered the Indian market on the strength of rising affluence levels of the young Indian population along with the heightened awareness of global brands and international shopping experiences and the increased availability of retail real estate pace. *evelopment of India as a sourcing hub shall further make India as an attractive retail opportunity for the global retailers. 2etailers like Bal#Mart, %&/, Tesco, C, /enney, HAM, 3arstadt#+uelle etc stepping up their sourcing re"uirements from India and moving from third#party buying offices to establishing their own wholly owned O wholly managed sourcing A buying offices shall further make India as an attractive retail opportunity for the global players. Manufacturers in industries such as 0M,%, consumer durables, paints etc are waking up to the growing clout of the retailers as a shift in bargaining power from the former to the latter becomes more discernible. &lready, a number of manufacturers in India, in line with trends in developed markets, have set up dedicated units to service the retail channel. &lso, instead of viewing retailers with suspicion, or as a Vnecessary evil as was the case earlier, manufacturers are beginning to acknowledge them as channel members to be partnered with for providing solutions to the end#consumer more effectively. The next level of opportunities in terms product retail expansion lies in categories such as apparel, !ewellery and accessories, consumer durables, catering services and home improvement. These sectors

53

have already witnessed the emergence of organized formats though more players are expected to !oin the bandwagon. (ome of the niche categories like .ooks, Music and %ifts offer interesting opportunities for the retail players. Indian consumer goods market is expected to reach L=66 billion by 46<6. India has the youngest population amongst the ma!or countries. There are a lot of young people in India in different income categories. In India they do not have to face this dilemma largely because rapid urbanization, increase in demand, presence of large number of young population, any number of opportunities are available . The bottom line is that Indian market is changing rapidly and is showing unprecedented consumer business opportunity. Indian consumer class can be classified according to the following criteriaE 1. Inco!e 2. Socio;8cono!ic status 3. /ge de!ogra#)ics 4. 1eogra#)ical dis#ersion

1. Inco!e -lassification

-onsu!er -lasses ()e Ric) ()e -li!@ers ()e /s#irants ()e *estitute (otal

/nnual Inco!e in Rs. Rs. 215C000 and !ore Rs. 22;45C000 Rs. 1";22C000 :elow Rs. 1"C000

1+++ 1.2 32.5 54.1 44 33 1"4.8

2004 2.0 54." $1." 28.1 23.4 180.$

200+ ".2 +0.+ $4.1 15.3 12.8 1++.2

-)ange 41"5 1$+5 3$5 ;"55 ;"15 215

()e -onsu!ing -lass Rs 45; 215C000

Source: NCAER 2. Socio;8cono!ic -lassification2

54

In addition to income classification and consumer classification, Indian households can also be segmented according to the occupation and education levels of the chief earner of the household Hthe person who contributes most to the household expensesI. This is called as (ocio#'conomic ,lassification H(',I, which is mainly used by market planners to target market before launching their new products. (', is made to understand the purchase behavior and the consumption pattern of the households 3. /ge *e!ogra#)ics2 India is a very young nation, if compared with some advanced and developed countries. $early two# thirds of its population is below the age of :7, and nearly 76 > is below 47. A e distri!ution i" #ndian population $#n %illions& Gear? /ge :elow 4 yrs 5;14 yrs 15;1+ yrs 20;34 yrs 35;54 yrs 55 F a@ove (otal

200" 113.5 221.2 122.4 2$+.1 23+.2 118.$ 10+4.1

2001 108.5 23+.1 10+.0 24".8 20$.3 101.$ 1012.4

1++" 11+.5 233.2 +0.$ 224 1$8.1 88.$ +34.2

Marketers explain that the boom in the consumption level and leisure related expenditure is because of this young population. It will have a significant impact over the consumer goods market. In addition to that, it is expected that this will generate trade opportunities and continuous investment in the economy. There is huge potential for further consumption of goods and services due to the increased level of disposable income. The expenditure on essential goods and services has a higher share in developing countries as compared with that of developed countries. -onsu!#tion (rends ood 8ssentials 45."85

8ssential Services AwaterC #owerC rentC and 10.15 fuelsB -lot)ing ootwear %edicare (rans#ort F -o!!unication 4.+5 0."35 4.255 14.515

55

RecreationC 8ducationC and -ulture 6o!e 1oods

.ess t)an 45 3.255

4. 1eogra#)ical *is#ersion of !ar,et #otential There is large difference in economic prosperity levels among several states in India, linked to the wealth creation from trade, industrial, and agricultural development. There are poor districts in many states, classified according to their market potential. India has 766 districts, out of which <76 districts Hcategory &I and next <76 districts Hcategory .I account for 8;> and <7> of the national market potential respectively. 2emaining 466 districts Hcategory ,I are backward and account for only 8> of national market potential. ,ategory , districts have =6> of the geographical share. 1RO7I31 8-O3O%G 'otential for all or!ats to ()rive 2 Most of the global powerhouses in the retailing sector such as Bal# Mart, ,arrefour, Tesco etc have adopted multi#format and multi# product strategies in order to customize their product offering for distinct target segments. (imilar trends Identifying t)e future The important thing is to identify the '"uture that has already happened' ( Peter )ruc*er

The important and distinctive are always the result of changes in values, perceptions and goals of people. Identify the changes that have already happened, exploit the changes that have already occurred and use them as opportunities. *r Billiam T Bilson, ,hief 'conomist for 3eystone India M a ,hicago#based firm providing cross#border trade facilitation and asset management services in J( are likely to be exhibited in India as all formats present prospects for growth, the 2eport says. 0urther, with the emergence of larger store formats like superstores and hypermarkets in countries like J3, 0rance, %ermany, (pain since the <5;6s and 'astern 'urope more recently, traditional food retailers have been able to stock more extensive non#food ranges. In fact, Tesco, J3 s leading grocer, has become the number one apparel retailer in the ,zech 2epublic and also a ma!or player in Hungary apart from being one of the fastest growing clothing retailers in the J3. Together with its rival, Bal#Mart#owned &(*&, Tesco is one of the food sector s most successful exponents of clothing in 'urope *IS'OS/:.8 I3-O%8 There is no point complaining, accusing or !ustifying that retailing business is only for larger players and multinational retailing companies. That s total rubbish and rather an assumed limitation.

56

2ecent research finding is that by the year 46<6, India will have at least three million people with an annual income of over 2s =,666,666. Mind you, this is the official, declared and straight income meaning there will be a considerable number of consumers with other sources of incomeR HI supposeI. 1ne could comfortably presume that one fourth of the three millions would reside in .angalore. ,onsidering the third successive year with great economic growth in India, it is obvious that we shall have more people with higher disposable income. Bith higher disposable income, the discerning Indian consumers are not going to be conscious about price alone. This emerging consumers would want something special, uni"ue, different, better, customized and more. 0ind the synonyms and transliterate these into value offerings in your field of business and you have a gold mine, especially when you manage to connect with the customers value and perception and India, said that after significant accelerations in economic growth recently, India s economy is expected to e"ual or surpass Capan as the world s third largest sometime in the year 4669. *r Bilson also added that India s economy measured in /// Hpurchasing power parityI terms will eclipse the J(L four trillion mark in 4669, making it e"ual to or greater than Capan s. Indian consumers are getting richer noticeably leading to higher disposable money. RISI31 I3-O%8S 1ver the past deacde , India)s middle and High Income group has grown at a rapid pace of over <6> per annum . Though this growth is most evident in urban areas, it has also taken place in rural markets. 0urther, the number of house holds earning above 2s.<76,666 per annum is about :6 million today and is expected to grow to ;6 million by 4668. This growing high#income population is triggering the demand for consumer goods, leading to the proliferation of Higher "ualityOhigher priced products.

8H'.OSIO3 O %8*I/ There has been an explosion in media as well during the past decade . 3ick#started by the cable#explosion during the gulf war, television has accelerated to a pint where there are more cable connections than telephones in Indian homes and more than <66 channels are being aired at all times .This media bombardment has exposed the Indian consumer to the lifestyles of more affluent countries and raised their aspirations from the shopping experience N they want more choice , value , experience and convenience.

'rivate .a@els
.rands, store labels, private label brands, store brands. These terms may seem to be synonyms of each other. However, when it comes to retailing, each of these terms has a different meaning. Bhile we all know what a brand is, a private label and a store label are different from any other brand because they are product lines that are owned, controlled, merchandised and sold by a specific retailer in its own stores. &mong Indian retailers, (top, -ife and 3ashish by (hoppers (top, and 'T, by 'bony are private label brands. &ccording to (ynovate, is the market research arm of global communications specialist &egis %roup, the growth of private labels is about 4#: times more than that of advertised

57

brands .&mong the product lines launched by retailers, the ones whose nomenclature is the name of the store itself are called store labels. 0oodworld and $ilgiris have launched their own brand of supermarket products under the G0oodworldG and G$ilgirisG brand names. There is a distinct advantage in naming the brand launched by the retailer after the same name as that of the store. .ut at the same time, the store label also carries the burden of not only the success of the brand, but also the failure, which may have a negative rub#off effect on the retailer s image. & store brand on the other hand is a brand name the retailer carries. 'ach retailer, because of its uni"ue offering, is a brand in itself, which is what the store brand signifies. $allis, Modern .azaar and The Home (tore are store brands since each of them stands for a certain retail offering. 2etailers are now aggressively moving into developing their own private labels as it not only makes economic sense in the form of retailers achieving higher margins, it also helps them to plug gaps in their product portfolio. 0or instance, in menswear, retailers say that gross margins on branded products vary from 47#:; per cent. ,ompared to that, the retailers can earn whopping margins of around 77#96 per cent on private labels. /rivate label products contribute to a retail brands differentiation. & retailer can achieve differentiation through a large Hbut not necessarily exclusiveI portfolio of private label products. (ervice adds to the differentiation, and together with a uni"ue product range, results in a strong retail brand. They are not perceived as being interchangeable with similar private label products launched by other retailers Hunlike manufacturers of branded products, which are the same regardless of the retailerI. Introduction of an in house brand of products helps the retailer to have means with which they can compete head on with the other branded products. &n established private label brand provides the retailers a platform to negotiate with suppliers, and the retailers are thus self#sufficient in a certain category. They have more control over the merchandise and are able to make the re"uired changes and modifications to suit the changing customer profile much "uicker. This brings about a more consistent and acceptable product portfolio, which also helps reduce mark#downs. & retailer can create a stronger emotional connect with the consumer as the experience is not !ust the store experience but also the product experience. &n outside brand could be purchased from any outlet. This is not so in the case of private labels, so the product experience keeps bringing the consumer back The "uestion isE why would retailers want to get into the trouble of launching an own brand when there are GnG number of local, regional and national brands for practically all kinds of productsW The reasons are multifold.

58

SWOT MARKET

OF

THE

59

6;

S(R831(6 <I 4I :I =I 7I 9I 8I 1rganized retailing at J(L :.:< billion, growing at ;>. 4nd largest contributor to %*/ after agriculture at 46>. /attern of consumption changing along with shopping trends. & %rowing population will translate to move consumers. ,onsumer spending increasing at <<> annually. &lmost 47 million s". ft. retail space available. /aradigm shift in shopping experience for consumers pulling in more people. ;I Most of the entrants to organized retail come from : main categories, and have ventured into retail as their business extension. X2eal 'state *evelopers X,orporate Houses XManufacturersO'xporters

78/>38SS8S <I 4I (hortage of "uality retail spaces at affordable rates. %overnment regulations on development of real estateHJrban -and ,eiling &ctI :I =I 7I $eed to provide Dalue for Money#s"ueezing margins -ack of industry status. 2etail revolution restricted to 476 million people due to monolithic urban#rural divide. 9I 0ootfalls not a clear indicator of sales as actual consumers lower in number. 8I -ack of huge investments for expansion

6:

O''OR(<3I(I8S2

<I

Increasing revolution.

urban

population#more

participants

in

retail

4I :I

Increase in consuming middle class population. (ocial factors like dual household income has enhanced spending power.

=I

(pends

moving

towards

lifestyle

products

and

esteem

enhancing products. 7I &vailability of old industrial lands#prime real estate locked in sick industrial units. 9I &verage grocery spends at =4> of monthly spends#presents a huge opportunity. 8I Increase in use of credit cards.

(6R8/(S2

<I 4I :I

2ising leaseOrental costs affecting pro!ect viability. 0*I restrictions in the retail sector. /oor monsoons and low %*/ %rowth could affect consumer spending drastically.

=I

&rchaic labor laws are a hindrance to providing 4=O8 shopping experience.

7I 9I

/ersonalized service offered by Mom#A#/op stores. Jnavailability of "ualified personnel to support exponential growth in retail.

62

8I

*ifferentiate taxation laws hindering expansion.

C'ALLENGES

63

2etailing in its traditional form has been existing in India for decades. .ut retail management in the true sense Has retailing is known in the westI is a relatively new discipline in India. It is unlike other forms of marketing and the traditional marketing rules do not apply. In retailing, as in service, there is a fifth / added to the existing = of marketing, the /eople. Therefore the contact person Hwhom the consumers interact withI becomes a doubly important entity. The most important difference is that where marketing has the classic = /s H/roduct, /romotion, /rice and placeI, in retailing a fifth /, people is added which is critical. They are critical to a service business like retailing both as employees who execute the business and the customers with whom retailers must interact. The "ollo+in are the *ey challen es o" retailin : Y -arge transactionsE 2etailers need to handle smaller transactions in large numbers and still be able to make money. Y -ow price strategyE The Indian consumer being value#conscious, a key to success for many retailers is the ability to attract customers by offering low price guarantee. Y &ggressive sales, discount and collection schemes Hsay, credit facilities.I and thus keep the enthusiasm going. Y Indian consumer behaviors # 2etailers need to conduct M2s and behavioral studies into the Indian psyche simply because he is so different from those in the west and in fact, different from other Indian consumers. His shopping patterns need to be analyzed in detail. Y -ocationE & prime location in the cityOtown so a big plus. Things such as waiting and parking areas need to be taken care of.

64

Y Jse of information technology HITI in developing a supply chain and integrating all the retailing processes from procurement to after sales. &s somebody rightly pointed out, India remains one of the last frontiers of modern retailing. ,on"uering the retailing in India will be a ma!or challenge, given the complications that the unorganized sector poses those of the supply chain and consumer behavior as well as the glaring complexities of such a vast a market with all kinds of consumer segments thrown in. & wise retailing hawk would set up special cellsF committees to track retailing industry throughout the country. .enchmarking the best in the country and seeing oneself as to where exactly he wants to be in the complicated perceptual map would be a fine starter. &ny retail chain needs to experiment and re# orient to cater to the local needs and preferences. %iven that these chains come with huge asset bases and financing from their international operations, this is not a difficult task. Bhile Indian markets still beckon a large retail chain, the success of anyone foraying into the land of snake#charmers and mahara!as ultimately depends on how well and in#depth understanding they have of the conditions, the people, the supply 2etailing in India chain dynamics, the poorer Hbut strongI unorganized cousins and of course, the local %odsR

,R- a critical !usiness process:

The Industry is facing a severe shortage of talented professional, especially at middle#management level. &reas gradually becoming critical are technology, supply chain, business development, marketing, product development and research. (uccessful Indian retailers are creating a robust second and third level of management by hiring aggressively for these key roles. There is also an increase in number of retail management programmes and institutes. This will bridge the gap in availability of talented professionals at the middle and lower levels. There is also an increasing trend towards hiring hotel management graduates in the retail sector. The retail industry is expected to create 4 million !obs between now and 46<6.However, talented professionals will put increased pressure on wage costs. Therefore, operating margins, especially for mid#sized retailers will shrink. There is also a huge risk for Indian retailers becoming a poaching ground for international retailers once they enter India.

An a ile and adapti.e supply chain is *ey

-ogistical challenges, constant changes in consumer preferences and patterns, crowded marketplaces, efficient customer responsiveness and swiftly evolving retail environment in India. These factors pose a huge challenge for that all important key to pushing growth in this kind of an environment# an efficient and adaptable supply chain.

65

In the last 4#: years ,several retailers ranging from 0A. operators to discount clothing, have implemented (upply chain management H(,MI solutions to improve core business processes such as global sourcing,distribution,logistics,innovation,transparency and visibility in financials and inventory, compliance and management of point of saleH/1(I data. %oing ahead, India)s 0M,% and retail sectors are likely to see an increase in adoption of (,M. However, most Indian retail players are under serious pressure to make their supply chains more efficient in order to deliver the levels of "uality and service that consumers are demanding. &s Indian and International retailers continue to grow their presence regionally, there will be a pressing need for a single, enterprise#wide IT platforms to manage operations, which will become increasingly complex.

Fraud in retail is e/pensi.e

Be feel that fraud in going to be one of the retail sector)s primary challenges in the future. 0raud and theft, including employee pilferage, shoplifting, vendor frauds and inaccuracy in supervision and administration costs the Indian retail industry about 2s 776#966 crores every year. This is despite the fact that most large modern format retailers use standard security features such as ,,TD)s, /1( systems and anti shoplifting systems for greater control over fraud and theft. In financial terms, cost of this fraud constitutes about 4> of the organized retail sector)s revenues. Be believe that the implications and size of this loss will be more significant as retailers continue to scale up and increase product lines.

#mpro.ement in in"rastructure and lo istics needed

India is a large and highly fragmented country, with 45 states and <; officials) languages. & bulk of its population, 99.<>, lives in rural retail potential Be feel that private logistics companies offering specialized services, refrigerated transport and ware house facilities across the country, along with timely distribution of supplies to retail outlets will.

66

LOCATION LANNING

67

T* ES OF LOCATIONS
/B 6ig) E Street .ocation2 a. Dery busy with high customer traffic. b. Has an array of retail stores in small sizes. areas. The lack of ade"uate infrastructure makes it virtually impossible to reach this virtually untapped market. *istribution, or lack of it, is a ma!or hindrance for retailers in India. The lack of "uality infrastructure across the country and a non# existent distribution sector results in inefficient logistics systems. Infrastructure is the weakest link in India)s path to progress and there is urgent need to address issues plaguing this area. Jrbanization is driving an increasing need to upgrade or create infrastructure facilities. &n indicator of the urgent need for highway development, for instance, is the fact that average daily traffic volume on highways of :5,666 /assenger car units H/,J)sI far exceeds the highway capacity of <7,666 /,J)s. Transport is a ma!or concern, with a deteriorating railway system and a limited highway network .In contrast to the global standards, the average load carried by trucks in India around 8 tonsZ is very low. However, the Indian %overnment is presently investing heavily in the state highway system. This will help in an overall decline in logistics a cost which is currently <6#<4> of total %*/. <6,666 MB of power needs to be added every year for next decade. %rowth in air passenger traffic, estimated at 46> p.a. for next two years, necessitates "uadrupling of airport capacities. /orts will witness :;> increase in tonnage in next #: years and hence, port infrastructure cannot be ignored. b. Has stores that are generally found in clusters based on product categories. c. High real#estate rentals. 'gE -inking road in .andra, .rigade 2oad in .angalore A:B *estination ? reestanding .ocation a. *oes not have a high footfall rate Hcustomer traffic needs to be pulled I through the store)s marketing efforts or productsOservicesOprocess differentiationsI

b. May not be a commercial retail area at all. c. -ow real#estate rentals. d. May have a large parking area. 'g E/hoenix Mills ,ompounds and (hopper)s (top in Mumbai. A-B S)o##ing -entre?%all .ocation

68

a .Has an 'xisting mall traffic. b .Has a clean 'nvironment. c. Has a designated parking area. d .Medium to High rental cost. 'gE *-0 Mall in *elhi, ,rossroads in Mumbai

#ocation' store design and layout:

1nce a geographical market has been chosen, the next step in formulating the retail business plan is to select a site for the store. The importance of this decision is summarized by a favorite saying of retailersE GThere are three vitally important things in retailing # location, location, and location.G In assessing the desirability of various available locations, note the positive and negative aspects of each. 1nce again, analysis of trends is important. $o location is staticF it is either improving or declining in such things as traffic flow and potential market area. (tore design and layout of the store s interior and exterior help determine the store s image and character. In planning a new store or remodeling of an old one, there is plenty of room for creativity. This part of the plan takes a lot of thought and consideration. (ome bad decisions made in the planning stage can be corrected, but mistakes made in the area of store design and layouts are usually "uite costly to correct. 2etailers can get specialized assistance from merchandise suppliers, local architects, and store planning consultants. *isplay windows, fixtures, lighting, and storage are examples of areas covered in this part of the retail business plan. (tore layout involves such considerations as allocation of space, customer traffic flow throughout the store, and maximizing profit per s"uare foot. 'lanning a retail @usiness )as several advantages. / well t)oug)t out #lan not only !a,es t)e @est of t)e #resentC @ut also antici#ates future contingencies 2etailing is a challenging and dynamic field. The retailer draws on knowledge from such areas as marketing, psychology, finance, accounting and management. 0rom the field of management, we learn that planning is one of the most important functions of the retailer. It is a function often neglected under the pressure of day#to# day business activity, but it is so important that the successful retailer must give it top priority. 2etailers must decide how to make the best use of limited resources, such as people, funds, and inventories. In order to use these resources in the most productive way, the retailer plans for the future. The most important planning occurs before a retail store even opens for business. ,areful planning at this time can greatly enhance a

69

store s chances of success. .y gathering and synthesizing the relevant information into a retail business plan, the retailer can make better decisions. & workable retail business plan should be detailed, specific, and in writing. Indeed, a ma!or advantage of planning is that it forces the retailer to put ideas in writing. Bithout planning, there is no predetermined course of action, and with out some predetermined course of action, retailers do not know what to do, where to do, or why it should be done. They waste their own energies and the resources of the store. /lanning involves selecting ob!ectives and developing specific program)s, policies, and procedures for achieving them.

Steps in "ormulatin the retail !usiness plan:

Setting o@&ectives;
/lanning begins with ob!ectives. (tores can have many different ob!ectivesE survival, growth, market share increase, high return on investment, and development of a good store image. (ome ob!ectives are more important than others. /rofit, of course, is a primary ob!ective for any retail organization. (ocial concerns, however, must often be given consideration, too, if the store is to be a Ggood citizenG of its business community 1b!ectives are difficult to apply to real situations and decisions if they are stated in vague terms. &n ob!ective should establish a measurable goal # a yardstick to compare results with efforts. %oals or ob!ectives such as Gto increase sales by <; per cent this yearG or Gto break even in the first year of operationG are examples of clearly defined and measurable ob!ectives. They must be supported with concrete plans that are specific for reaching these goals. In forming the retail business plan, be as specific as possible. 2emember to be customer#oriented while setting ob!ectivesF it is one of the keys to successful retailing. *o not lose sight of these ob!ectives once they are formulated. (chedule "uarterly, or if appropriate, monthly reviews of progress. 2evise and update your ob!ectives periodically as well.

Financial plannin :
0inancial planning is an important part of the retail business plan. In fact, inade"uate financial planning is a fre"uent cause of store failure. 0inancial statistics on the type of business under consideration are often available from trade associations. This information can be invaluable to the manager in the initial planning stages. The retailer must make a sales forecast, calculate a break# even point, and estimate the capital re"uirements of the business. &sset planning, another essential part of financial planning, involves inventory, accounts receivable, e"uipment and fixtures, and cash. 1ften, these assets must be financed in part with funds obtained from outside sources # banks, relatives, and so on.

7;

Assessin a.aila!le resources:

Bhat are the strengths and weakness of the businessW .y assessing these factors, a retailer can maximize the use of all available assets and can limit or eliminate the handicaps imposed by the inherent weakness of these resources. 'xperienced, creative management is a strong resource. (ufficient working capital to meet the costs of doing business the first year is another. &t least as important as knowing the strengths of the business is analyzing its weaknesses. &wareness of weak areas is the first step in overcoming them. (ome weaknesses can be overcome by hiring an outside expert in areas in which the retailer s knowledge and experience are limited. &dditional training and outside reading are other answers to many weak areas. & retailer with general retailing experience but little knowledge of, say, the shoe business, could benefit greatly by hiring experienced shoe salespeople if she is planning to open a shoe store. & retailer who is weak in the areas of financial planning and control needs to work closely with a good accountant. 'ven during the planning stage, an accountant can be helpful in setting up an appropriate bookkeeping system.

Assessin mar*et potential

Bhat type of customer, or what segment of the market, does the store cater toW Is there enough demand for the products to provide sufficient sales volumeW These are some of the main "uestions the retailer tries to answer by assessing market potential. The key factors in market assessment areE first, the number of people living in the trade area, and second, the buying power of these people. &n extreme example of poor market assessment would be trying to sell expensive fur coats in a poor mining town. 'ven the age distribution of the population can affect a store s market potential. /ssessing t)e co!#etitive situation ,ompetition is a good thing. It leads to better products and services at lower prices. It can inspire a retailer to do a better !ob. However, numerous and O or aggressive competitors are costly to the retailer in many ways. /rice wars eat away profits. Too many similar stores serving too few consumers cause the sales volume of each store to suffer. 0or some types of stores, however, the best strategy can be to locate as close as possible to the competition. ,ompeting stores located in the same area may increase customer traffic. (ome cities, for example, have an area with many anti"ue shops. ,ustomers are drawn to the area because of this convenience, and each store s traffic helps the other stores. 2etailers should not be afraid of competition, but they should try to find a market where there is an unfilled demand for the type of store they are planning.

7:

Ot)er assess!ents2 -ocal laws, tax rates, and the labour force are other areas that can affect the retail store. The planner should investigate these uncontrollable environmental factors. In this preliminary work, be aware of trends as well. 0or example, demand for the products may look very promising in a certain area, but the population of this area might be declining. 1n the other hand, an area with slightly lower market potential at present could be growing very fast and provide a better long#run market for a particular store. These assessments are often difficult to make, but the effort put into planning at this stage will pay off handsomely when store operations get under way. .ocationC store design and layout2 1nce a geographical market has been chosen, the next step in formulating the retail business plan is to select a site for the store. The importance of this decision is summarized by a favorite saying of retailersE GThere are three vitally important things in retailing # location, location, and location.G In assessing the desirability of various available locations, note the positive and negative aspects of each. 1nce again, analysis of trends is important. $o location is staticF it is either improving or declining in such things as traffic flow and potential market area. (tore design and layout of the store s interior and exterior help determine the store s image and character. In planning a new store or remodeling of an old one, there is plenty of room for creativity. This part of the plan takes a lot of thought and consideration. (ome bad decisions made in the planning stage can be corrected, but mistakes made in the area of store design and layout are usually "uite costly to correct. 2etailers can get specialized assistance from merchandise suppliers, local architects, and store planning consultants. *isplay windows, fixtures, lighting, and storage are examples of areas covered in this part of the retail business plan. (tore layout involves such considerations as allocation of space, customer traffic flow throughout the store, and maximizing profit per s"uare foot. Organization and su#ervision /lanning is an example of a management function. 1ther management functions performed by the retailer are organizing, staffing, leading, and controlling. .y organizing, the retailer establishes relationships among people, materials, and other resources to get a !ob done. -abour is organized and divided, and responsibility is delegated. (taffing entails the recruitment and selection of employees. It is a vitally important function because the employees of a store represent that store to the public. /eople can really be the most important asset of a retail firm. 'very retailer is in a leadership position. -eadership means motivating employees to achieve their maximum potential, while at the same time accomplishing the goals of the organization. .ecause leadership means understanding people, it is one of the most

72

creative and challenging aspects of a retailer s !ob. The retailer s professionalism and attitudes set the tone for employees attitudes and performance. ,ontrolling is the follow#up function of retail management. &ctual performance is compared with planned performance to spot and evaluate deviations. >nowledge on @uying 0or established retail operations, past sales data are very helpful in knowing how much to buy. 0or a new retail business, these past data are not available. However, if a sales forecast and desired inventory turnover rate have been determined, the beginning inventory figure can be calculated. & balance between meeting customers needs and high inventory carrying costs must be found. 3nowing how much to buy goes hand in hand with knowing what to buy. (uccessful retailing involves having the right merchandise in the right place, at the right time, and at the right price for the customer. Information from store records is a valuable aid in knowing what to buy. In the absence of this information, an understanding of the target customer s shopping habits and motivations, is helpful. Information from suppliers can provide valuable input for the store buyer. 1nce the inventory has been obtained, a unit control system must be set up to keep track of the stock. 'ricing The goals of retail pricing are fourfold. 0irst, the goods must sell at a satisfactory rate. (econd, inventory costs and expenses must be covered. Third, a desired profit must be made, and fourth, prices should be fair to customers. There are different pricing strategies for different types of stores, from the discount store to the exclusive shop with "uality merchandise and expanded customer services. /ricing in retailing is both a science and an art. 2etailers have special terms to describe various pricing operations, such as markup, markdown, and psychological pricing. /ricing is, naturally, closely related to financial planning. /dvertising and #ro!otion & store s location, layout, design, and product lines affect its overall image. &dvertising is another key element of the store s image in the minds of customers. &dvertising can be thought of as communicating with customers. The ob!ective of an advertisement is to stimulate the customer to want what the retailer has to offer, and to persuade the customer to take action to satisfy the stimulated want or need. .esides advertising, retailers send messages to customers through personal selling, sales promotion, and packaging. Information channels beyond the direct control of the retailer are publicity and word#of#mouth communication.

73

.y giving careful consideration to defining who the advertisement is directed at Hthe Gtarget customerGI, retailers can get more mileage out of advertising spend. The content of an advertisement should focus on benefits desired by the target customers. (ales promotion and display techni"ues are a ma!or promotional tool. (ales promotions can have various ob!ectives, such as generation of immediate sales, attracting customers to the store, and building goodwill. Bindow displays can serve to attract customers, to show customers the kind of merchandise the store carries, and to pro!ect the image of the store. .ecause window displays are so visible, they should be given the attention, care, and creative input they deserve. Interior displays can be informative, can stimulate impulse buying, or can suggest uses of a product. In addition, they can enhance the store s image. 1ther sales promotion strategies include special events, sales, coupons, and trading stamps.

8!#loyee selection and training The salesperson is a communicatorE This person translates product features into benefits and satisfactions for the customer. .ut most important, the salesperson is the representative of the store to its customers. The uni"ue "uality that distinguishes personal selling from other promotion activities is the opportunity for feedback between customer and salesperson. %ood advertising and promotion can get people into a store. %ood salespeople and good value keep them coming back. The importance of employee selection and training cannot be overstated. Many retailers are surprised to learn that monetary compensation, although important to employees, is usually not their most important concern. 0airness, security, honesty, and opportunity are often more important than pay. Services &n enlightened retailer realizes that the customer is the pivot around which all retailing activities revolve. This attitude is expressed to the customer through shopping conveniences, services, employee attitudes, and fair values. &s part of the retail business plan, decisions must be made about the types of services to be offered. (ervices, and handling of credit policies and customer complaints, deserve the ongoing attention of the manager. /ccounting and financial !anage!ent Information and control play an important role in the internal operation of a retail business. %ood records are the basis for guiding

74

and controlling a retail business. They are the tools a manager uses to control inventory, expenses, and ultimately, profits. 0inancial statements, such as balance sheets and income statements, are summaries of the financial strength and profitability of the retail business. They tell how well a business is doing, and give evidence about the "uality of management decisions. 0inancial planning in the form of budgets helps retailers to spot problems before they occur. Infor!ation 1ne information tool in particular has been a real boon to retailers, and that is the computer. More and better information is available to the retailer now than ever before, because of computers. This means that better and faster decisions can be made. ,omputers offer speed and accuracy of information processing that is especially helpful in inventory management. Information is important for intelligent decision#making. Much of this information evolves from basic store records or is provided by a computer system. &nother source of information for the retailer is marketing research, such as the market assessment. Most of the research involved in formulating the retail business plan is in fact, marketing research. 2esearch can also help answer "uestions in such areas as pricing, promotion and distribution.

75

%O($ "I"OR ANA#&SIS

The table below outlines some of the strategic moves being planned to change the competitive structure of 2etail business in India.

8arly :irds
Retailer :rands 'lans Strengt)s -)allenges ()reats

76

3 2ahe!a %roup

(hopper)s (top, ,rossword, Inorbit Mall Hyper ,ity, ,af[ .rioO*esi ,af[

:<6 (hoppers) (top 1utlets by 46<6, 96#86 new ,rossword outlets within two years, <66 ,af[ .rioO *esi ,af[ and <= new Hypercity

/ulse on customer tastes with vast local retailing experience

3eeping up brand loyalty

,ould get bogged down positioning itse right

0uture %roup

/antaloon, .ig .azaar, 0ood .azaar, 0ashion (tation, .lue (ky

& store a day for the next three to four years N :,:66 planned by 46<6

,an evolve on vast customer experience and existing models

'xpanding customer base, sourcing products at cheaper rates

(traddling with too many reta formats

Tata Trent

Bestside

-ooking to register it)s presence in hypermarketsF currently operates 4< stores

&lready has an established brand like Bestside

(prucing up product offerings, opening more outlets, and introducing new retail formats

It)s smaller ret operations

2/%

(pencer)s, Music Borld

'xpansion into other ma!or cities at prime locationsF .# ,ities next on list

(till considered a southern brand

'stablishing itself into newe regions, sourcing products at competitive prices

Source : #ndian %ana ement0 1olume 230 #ssue 10 4anuary 56670 Pa e 13

!e)utantes
Retailer rands !lans Strengt"s C"allenges T"reats

77

Re*ian,e

Re*ian,e =resh

!*ans to set u- a range of different store formats$ ,onvenien,e stores and hy-ermarkets as we** as ,reate a +a,k-end retai*servi,es +usiness !an-Indian o-erations e/-e,ted

<trong +a,k end$ nationwide fue* retai*ing -*atform

1etting the retai* -ortfo*io right for Indian tastes

!rodu,t -ri,ing$ infrastru,ture$ man-ower$ +rands

'harti Wa*mart

=ie*d =resh

'harti@s *o,a* e/-ertise and Wa*-Mart@s +a,k-end make it a *etha* ,om+o

Wooing the -ri,e sensitive Indian ,onsumer

!rodu,t -ri,ing$ she*f and overa** offerings

In t)e 'i#eline Retailer

Aditya 'ir*a

rands
Madura 1arments$ 'ir*a <un Life Insuran,e and Idea (e**u*ar$ !*anet =ashion and rouser own %asy 'i**

!lans
o ro** out it@s retai* +usiness within the ne/t 7-8 months with a ,om+ination of *arge and sma** stores

Strengt"s
%/tensive e/-erien,e in su--*y-,hain management$ vendor deve*o-ment with -remium +rands *ike Louis !hi**i--e$ "an Heusen and A**en <o**y <trong +a,kground in severa* manufa,turing se,torsA sound finan,ia* +ase

C"allenges
1aining a nationa* foot-rint

T"reats
'ui*ding retai* formats from s,rat,h

Hero 1rou-

=*oated Aero Infrastru,ture Ltd announ,ing foray into retai*. (urrent*y deve*o-ing two industria* -arks at Haridwar and &ttaran,ha*

(reating retai* o-erations from s,rat,h

Litt*e e/-erien,e in everyday ,onsumer retai*ing.

78

*uture Outloo+

79

2etailing in India is gradually inching its way toward becoming the next boom industry. The whole concept of shopping has altered in terms of format and consumer buying behavior, ushering in a revolution in shopping in India. Modern retail has entered India as seen in sprawling shopping centers, multi#storied malls and huge complexes offer shopping, entertainment and food all under one roof. The Indian retailing sector is at an inflexion point where the growth of organized retailing and growth in the consumption by the Indian population is going to take a higher growth tra!ectory. The Indian population is witnessing a significant change in its demographics. & large young working population with median age of 4= years, nuclear families in urban areas, along with increasing workingwomen population and emerging opportunities in the services sector are going to be the key growth drivers of the organized retail sector in India. 2etail and real estate are the two booming sectors of India in the present times. &nd if industry experts are to be believed, the prospects of both the sectors are mutually dependent on each other. 2etail, one of India)s largest industries, has presently emerged as one of the most dynamic and fast paced industries of our times with several players entering the market. &ccounting for over <6 per cent of the country)s %*/ and around eight per cent of the employment retailing in India is gradually inching its way toward becoming the next boom industry. &s the contemporary retail sector in India is reflected in sprawling shopping centers, multiplex# malls and huge complexes offer shopping, entertainment and food all under one roof, the concept of shopping has altered in terms of format and consumer buying behavior, ushering in a revolution in shopping in India. This has also contributed to large#scale investments in the real estate sector with ma!or national and global players investing in developing the infrastructure and construction of the retailing business. The trends that are driving the growth of the retail sector in India are

.ow s)are of organized retailing alling real estate #rices Increase in dis#osa@le inco!e and custo!er as#iration Increase in eI#enditure for luIury ite!s A-6/R(B

Road /)eadJ 'lans of .arge Retailers

Reliance RetailE investing 2s. :6,666 crore HL9.98 billionI in setting up multiple retail formats with expected sales of 2s. 56,666 crore plus HL46 billionI by 4665#<6. 'antaloon RetailE Bill occupy <6 mn s".ft retail space and achieve 2s.5,666 crore#plus HL4 bnI sales by 466;. R'1E /lanning I/1 will have =76#plus Music Borld, 76#plus (pencer s Hyper covering = million s".ft by 46<6. .I 8S(G.8E Investing 2s.=66 crore#plus HL56 millionI in next five years on Max Hypermarkets A value retail stores, home and lifestyle centres.

8;

Ra)e&a=sE 1perates (hoppers (top, ,rossword, Inorbit Mall, and Home (top formats. Bill operate 77 GHypercityG hypermarkets with J(L<66 million sales across India by 46<7. 'ira!yd RetailE &iming to occupy <.87 million s".ft retail spaces through <76 stores in next five years.

(erger and ac,uisition activity

8:

India witnessed a record number of MA& deals in the first half of 4669, which were collectively worth J(* 47.9 billion. & significant number of deals have being carried out in the Indian retail sector in the past few months in order to ac"uire a larger share in the growing domestic market and to compete against the prospective global and domestic players.<: The table below shows some recent deals that have taken place in the Indian retail sectorE

,onsideration ?ear &c"uiredO CD ,ompanyO &c"uirer Target -iberty (hoes 0uture group $ature of .usiness (take HJ(L millionI : 7

4667 4667

2etail H0ootwearI 2etail clothing

7<> 9;>

Indus # -eague ,lothing 0uture group

4667

1dyssey India

*eccan ,hronicle Holdings

-eisure retail chain Hbooks, music, <66> toysI .ooks, music, accessories

<=

4667

-andmark

Tata Trent

8=>

4=

4669

.istro Hospitality

T%I 0riday s Ha subsidiary of ,arlson 2estaurant H0ood 2estaurant Borld# retailI wideI -ingerie and women s wear retailing

47>

$O&

Indus -eague clothing 4669 H0uture group companyI 'tam group, 0rance

76> HCDI ;

Source: Price +ater house Coppers0 Asia(Paci"ic %8A !ulletin0 mid year 56639

82

"echnology - A %ritical "ool

1ut#of#stocks are the most noticeable problem for consumers \ during normal shopping experiences eight per cent of intended purchases are not on the shelf and when it comes to promotional offers, these out#of#stocks rise to <7 per cent. 0aced with an empty shelf, consumers often do not substitute the same brand. They simply keep their money and leave the store in search of another product. -et s take the example of a L47#billion retailerE lost sales due to out#of#stocks added up to nearly < per cent of total sales \ a mind#boggling figure of L< billionR 2etailers across the nation are unable to predict and master the demand#supply gap as a result of orthodox tools to measure changing consumer behavior. ,onsidering the Indian retail industry grew by :66 per cent in the last <4 months and supply chain accounts for 76 per cent of costs, retailers are now looking at ways to enhance the supply chain and predict consumer#buying habits. High consumption patterns driven by disposable incomes, lifestyle shifts and availability of a wide range of brands are dictating the high#growth of different retail formats in India. $o wonder, Indian retail players are under tremendous pressure to make the supply chain more efficient in order to deliver "uality, selection and service to consumers. 2etailers are now looking at creating an efficient supply#chain via a concept popularly referred to as consumer driven replenishment. Bhat this implies is placing the consumer in the centre of the replenishment process, to allow retailers to be able to use real#time data to sense and respond to changing consumer demands. To implement consumer driven replenishment, one needs to first collect and analyze pre# shopping signals, which often go unnoticed today. 0or example, consumers may speak to store associates or call centre agents to en"uire on a particular product. &s this often leads consumers to purchase products, retailers and supply chain partners can use existing consumer touch points to map consumers buying preferences. 0or example, (panish retailer Sara furnishes its store employees with /*&s to help them order out#of#stock items the minute the customer brings it to the assistant s attention. This information captured via the /*&s dictates next#day replenishments at the stores. In another instance, Bal#Mart leverages weather data for replenishment. Bhen the world s largest retailer knows about an approaching hurricane or snowstorm, the stores in that area are doubly stocked up with essential items such as bottled water and batteries. This data helps Bal#Mart align inventory with increased demand to cover unnatural events and prevent out#of#stock situations. ,onsumer driven replenishment will change the way the industry handles forecasting and replenishment. The ma!or business change will start at the business process levelF to respond "uickly to consumer demand, retailers and their supply chain partners must redesign the current business process. &ll supply chain partners will become part of a cohesive architecture, enabling information to flow freely from retail functions to suppliers. Inevitably, consumer driven replenishment within the Indian retail sector will be reflected in rapid growth in sales of supermarkets, department stores and hypermarkets. &nd with this increased competition, retailers will look at various opportunities to maximize customer satisfaction. These will include initiatives to streamline internal back end costs so as to translate savings onto customers, maximizing mind share in a cluttered market and delivering the best in store experience. 3eeping these deliverables in mind, some of the other key modules that the store of the future will look to implement will includeE

Store connecti.ity:
(tores will invest in building wide#area networks HB&$sI and virtual private networks HD/$sI to access information across various sites. Bith visibility into every resource, stores will take advantage of up#to#the#minute data at the right time for increased strategic flexibility and informed decision# making for managing inventory.

RFID: Bidely regarded as the key defining technology to hit the retail sector, 20I* tags on each piece of merchandise will enable companies to monitor their inventory at a more detailed level than ever before. 'xecutives will identify when problems occur by monitoring signal readers installed at key !unctures, such as loading docks, receiving points, distribution centers, backrooms and store shelves. These readers in turn will be networked to a centralized monitoring system that would give companies information they could never imagine with current operations, allowing them to identify problems as shop lifting, inventory management, and even gray market) sales that can erode profits and damage distribution relationships. -et)s see the actual benefits of using 20I* in the supply chain. The biggest benefit is the total visibility across the entire supply chainE Bhat managers worry about the mostW It is directly or indirectly related to uncertainty. :ncertainty is the mother o" in.entory and the "ather o" stoc*(outs9 Inventory %anage!ent Y Maintain a real#time view of tagged inventory as it flows through the supply chain. Y Track discrete movement of tagged inventory. Y Trigger alerts around inventory movement based on business rules you construct. Y &llowing !ust#in#time practices. %aIi!izing ware)ouse s#ace Bith the high costs associated with storage real estate, the goal is to maximize warehouse space. This will improve utilization without undermining the ease with which goods can be moved in and out. %ini!izing goods s)rin,age Theft combined with imprecise inventory management can create a significant shortfall in actual versus expected goods available. Bithin the retail environment goods shrinkage is widely perceived to account for up to one per cent of stock, representing a significant dent in profit margin. :enefits to -onsu!ersC 20I* can go beyond !ust intangible cost savings, as 20I* can play a role in food safety, counterfeit control, and warranty programs. .usinesses must avoid focusing too intently on the ways 20I* tags can be used and instead stay focused on how 20I* can improve consumer value and address complex business issues. %ini!izing errors in delivery Misdirected deliveries or incorrect orders can immediately result in on#shelf out#of#stock situations leading to reduced sales and damaged customer relationships. Indeed, for organizations relying on the delivery of specific components to fulfill their own order schedule, such errors can have a serious impact on customer satisfaction. Store MobilityE (tores will use wireless technologies at the point of sale for faster checkout and real#time product information in the store to improve operations, and throughout the supply chain to reduce costs.

IP Communications: <tores wi** ,onverge their data and voi,e systems$ -roviding instant ,ommuni,ation throughout stores at signifi,ant*y redu,ed ,osts.
In conclusion, suffice to say that faced with poor supply chain management and a rapidly changing environment, today s retailers will most definitively look for consumer driven replenishment to simplify supply chain operations, control costs, and measure results. Bith networks that will enable real time updates to predict and replenish stocks, the Indian consumer will hopefully never find his shopping preferences out of stock. The Indian retail market is booming, and there are numerous applications\both business and consumer\that can be built around radio fre"uency identification H20I*I to deliver operational

efficiencies. 0or instance, if a retailer is able to track shipments and high#value assets in real#time, it can minimise losses. &part from improved and enhanced accuracy, 20I* can also lead up to ;6 percent savings in time spent on scanning items. 'xplains ,hamaria, P20I* is a transformational technology that has the potential to change the way business is conducted. &lthough at a nascent stage, we expect 20I* will start gaining traction around 46<6. The cost of tags and readers is fairly high todayF once it comes down and 21I is established, it will surely be a boon for both retailers and ,/% companies.Q &ggarwal of .'& elaborates. PBhile 20I* is at a nascent stage, there are several killer applications that can utilise 20I* technology across verticals. (upply ,hain Disibility and 2eusable &sset Tracking will emerge as key solutions that have high applicability in the Indian market, especially in manufacturing, retail, government and healthcare.G .ut as of now, 20I* has hardly any presence in India. -aments ,hopra, PIndian retailers are still to adopt bar#coding completely. The level of bar#code usage is also largely due to the retailers) initiatives of printing these codes at their warehouses, unlike in developed countries, where suppliers print bar# codes. Most retailers do not have integrated IT systems today. Many retailers have few IT systems in the areas of supply chain management, vendor development, merchandising and inventory management. The annual expenditure on IT is "uite negligible.Q

Te+h!olo#y i! Retail

1ver the years as the consumer demand increased and the retailers geared up to meet this increase, technology evolved rapidly to support this growth. The hardware and software tools that have now become almost essential for retailing can be into : broad categories.

-usto!er Interfacing Syste!s

.ar ,oding and (canners /oint of sale systems use scanners and bar coding to identify an item, use pre#stored data to calculate the cost and generate the total bill for a client. Tunnel (canning is a new concept where the consumer pushes the full shopping cart through an electronic gate to the point of sale. In a matter of seconds, the items in the cart are hit with laser beams and scanned. &ll that the consumer has to do is to pay for the goods.

/ayment /ayment through credit cards has become "uite widespread and this enables a fast and easy payment process. 'lectronic che"ue conversion, a recent development in this area, processes a che"ue electronically by transmitting transaction information to the retailer and consumer s bank. 2ather than manually process a che"ue, the retailer voids it and hands it back to the consumer along with a receipt, having digitally captured and stored the image of the che"ue, which makes the process very fast.

Internet Internet is also rapidly evolving as a customer interface, removing the need of a consumer physically visiting the store.

'2/ (ystem Darious '2/ vendors have developed retail#specific systems which help in integrating all the functions from warehousing to distribution, front and back office store systems and merchandising. &n integrated supply chain helps the retailer in maintaining his stocks, getting his supplies on time, preventing stock#outs and thus reducing his costs, while servicing the customer better.

,2M (ystems The rise of loyalty programs, mail order and the Internet has provided retailers with real access to consumer data. *ata warehousing A mining technologies offers retailers the tools they need to make sense of their consumer data and apply it to business. This, along with the various available ,2M H,ustomer 2elationship ManagementI (ystems, allows the retailers to study the purchase behavior of consumers in detail and grow the value of individual consumers to their businesses.

&dvanced /lanning and (cheduling (ystems &/( systems can provide improved control across the supply chain, all the way from raw material suppliers right through to the retail shelf. These &/( packages complement existing Hbut often limitedI '2/ packages. They enable consolidation of activities such as long term budgeting, monthly forecasting, weekly factory scheduling and daily distribution scheduling into one overall planning process using a single set of data. -eading manufactures, distributors and retailers and considering &/( packages such as those from i4, Manugistics, .ann, Mercia-incs and (tirling#*ouglas.

Strate#i+ De+isio! S&pport Systems

(tore (ite -ocation *emographics and buying patterns of residents of an area can be used to compare various possible sites for opening new stores. Today, software packages are helping retailers not only in their locational decisions but in decisions regarding store sizing and floor#spaces as well.

Disual Merchandising The decision on how to place A stack items in a store is no more taken on the gut feel of the store manager. & larger number of visual merchandising tools are available to him to evaluate the impact of his stacking options. The (/&,'M&$ (tore (uit from &, $eilsen and Moda,&* are example of products helping in modeling a retail store design.

#n.estment ;pportunities

/otential 0or InvestmentE The total estimated Investment 1pportunity in the retail sector is around J(L 7#9 .illion in the $ext five years. -ocationE with modern retail formats having made their foray into the top cities namely Hyderabad, ,oimbatore, &hmedabad, Mumbai, /une, ,hennai, .angalore, *elhi, $agpur there exists tremendous potential in two tier towns over the next 7 years. (ectors with High %rowth /otentialE ,ertain segments that promise a high growth are

0ood and %rocery ,lothing 0urniture and 0ixtures /harmacy *urables, 0ootwear A -eather, Batch A Cewellery

0astest %rowing 0ormatsE (ome of the formats that offer good growth potential areE o (peciality and (uper Market

Hyper Market *iscount stores *epartment (tores ,onvenience (tores and '#2etailing

(upply ,hain InfrastructureE (upply chain infrastructure in terms of cold chain and -ogistics. 2ural 2etailE 2etail sector offers opportunities for exploration and investment in rural areas, with ,orporates and 'ntrepreneurs having made a foray in the past. India s largely rural population has caught the eye of retailers looking for new areas of growth. IT, launched the country s first rural mall ,haupal (agar , offering a diverse product range from 0M,% to electronics appliance to automobiles, attempting to provide farmers a one#stop destination for all of their needs. There has been yet another initiative by the *,M (riram %roup called the Hariyali .azaar , that has initially started off by providing farm related inputs and services but plans to introduce the complete shopping basket in due course. 1ther corporate bodies include 'scorts and Tata ,hemicals Hwith Tata 3isan (ansarI setting up agri#stores to provide productsOservices targeted at the farmer in order to tap the vast rural market. Bholesale TradingE wholesale trading also holds huge potential for growth. %erman giant Metro &% and (outh &frican (hoprite Holdings have already made headway in this segment by setting up stores selling merchandise on a wholesale basis in .angalore and Mumbai respectively. These new#format cash#and#carry stores attract large volumes from a sizeable number of retailers who do not have to maintain relationships with multiple suppliers for all their needs.

,heap ,onsumer ,redit

Government Initiatives . Regulations

There has always been a strong opposition to 0*I in India)s retail sector Hthough <66 percent 0*I is allowed in distribution companies that sell to the trade and not to the consumerI. The .C/ was not too keen on it early on, though towards the end of Da!payee)s governmentVs term there were noises that it would consider such a move. These days, the left parties are orchestrating a passionate opposition to allowing 0*I in retail. The arguments are familiar N that global retailers will swamp the Indian markets, wipe out small kirana stores and put millions of !obs in !eopardy. They also argue that giant global retailers will s"ueeze suppliers and finish them off. P The negative effects in terms of !ob losses and the displacement of traditional supply chains by the monopolyO monophony power of multinational retailers far outweigh the supposed benefitsTQ the left observed in a recent seven#page note that summarized its arguments against 0*I. %iven the political clout of the small trading community, because of their enormous numbers, the government has barred 0*I in retailing since <558. Most of India)s home grown retailers also oppose 0*I, though for a different reason. PBhat is the hurry Hto allow 0*IIW 0or <6 years, ,hina allowed only one foreign store per province. I allowed domestic chains to build up good valuation before opening 0*I, Pargues 3ishore .iyani, managing director, /antaloon 2etail. P The debate is not Vwhether or not to allow 0*I, but Vwhen and how),Q he clarifies. .iyani is also chairman of ,onfederation of Indian Industry)s retail committee, which estimates that 2s.46, 666 crore will be needed in retail to scale up to its potential. Indian companies need time to mobilize at least part of the capital before the foreign players are allowed in, argues ,II. In private some domestic retailers fear getting lower valuations from their global counterparts if they sell out today. .ut five or <6 years later, when they have built up larger business, they may get far higher valuations. 1f course, the argument of asking for more time to get even better valuation may not lose its appeal even a decade later, if the approach is instinctively protectionist. I$*I&)s retail industry N the fourth largest in the world N accounts for << per cent of the country)s %*/ and employs over =6 million people Habout 8 per cent of (ector retailers H?es, they have retailing /(J)sRI had a :4 percent share and private sector retailers had =7 per cent. total employment in the countryI. $ow, a huge ma!ority of the retail workforce is in kiranas.This sector, in fact acts as an informal social security net N almost anyone without a !ob can set up a kirana. The big worry is that global retailers will "uickly put these kiranas out of business, leading to millions of !ob losses. Is that fear !ustifiedW The answer can be found in the experience of othercountries that allow 0*I in retail. In Thailand and Malaysia, global retailers have spelt doom for the traditional mom and pop stores. In fact the Thai government had to step step in to save local retailers from annihilation. It set up &llied 2etail Trade, a network of franchised stores, which brought small stores together to fight the big chains. .ut if the Thailand story is forbidding, then the ,hina one is inspirational. %lobal chains have had a <: year run in china. In <554, ,hina had one supermarket. Today it has 96, 666. H(upermarkets are perceived to be kirana killersRI. 0our of the world)s <6 largest retailers, :7 of the top 76 and 8; of the top 476 have already opened stores in ,hina. Hypermarkets, supermarkets, discount stores, cash A carry convenience stores every conceivable format operates in ,hina. The globalization of china is complete.

So what impact has this had?

The top <66 retailers Hboth domestic and foreignI in ,hina had combined sales of L96 billion in 466=, according to the ,hina ,hain (tore A 0ranchise &ssociation. These <66 companies have so far opened :6,=<9 stores with a total area of 47.; million s"uare metres. .ut N and here)s the revelation they have only 5.9 per cent share of ,hinaVs L94;# billion retail tradeR That figure has grown from 4.5 per cent in 4666. It must be mentioned that the global giants got unfettered access into ,hina only in 466=. Therefore their performance cannot be compared with rest of the country)s retail sector, but must be benchmarked only against the top <66 firms. Bhen seen thus, the foreign firms account for only 4: percent sales of the top <66 retailers. ,hina)s public $ow, the "uestion is which theory is relevant to India N ,hina)s or Thailand)sW PIndia cannot be compared with Thailand and Malaysia as the scale is much smaller and economic levels are dissimilar. The right comparison would be %ermany 46#:6 years ago or .razil today. ,hina makes sense because of its similarities with IndiaE large area, large chunk of underdeveloped population, disparity in income levels,Q says &rvin (inghal, chairman of consultancy 3(& Technopak. 1r better still, one could also look at the J( story. Its retailing industry is one of the most matures ones in the world. It is also home to some of the world)s largest retailers. .ut there is a less understood aspect of the J( retail scene N 57 percent of all retailers in the J( are single N store operations. They may not be as the Indian 3irana, but they are still small Vmom and pop) operations on the J( scale. *espite over six decades of dominance by large chains, these small players have not find a lot of them in the vicinity of a Bal# Mart or a target. They are also under pressure and their market share in on the decline. .ut the fact is that the single# store operations still control a little less than 76 percent of J( retail trade. &gain, back home, in ,hennai, where large and organised supermarket chains like 0oodBorld and $ilgiri)s have grabbed a 46 percent market share, the kiranas haven)t been slaughtered. They are smarter, more efficient more customer# friendly than they were five years agoF they are matching the chains) prices and continue to do brisk business. 'ven stores in close vicinity of these large supermarkets have survived. P(mall businesses have their own competitive advantages. They are localF they are usually in the same block that the customers are inF and they are very convenient. They know their customers by name, so they offer great customer service. They have tailored their inventory for their customers, so they have great inventory management, and many times they give credit. (mall businesses have their own model, offer a different product mix, and keep their customers happy. I think small business can grow and prosper with Bal Mart, PMenzer had argued in an inclusive interview with .B during his May visit.

Be!e$its o$ ope!i!# the Retail se+tor

#mpro.e competition )e.elop the mar*et : %reater level of exports due to increased sourcing by ma!or players (ourcing by Bal#Mart from ,hina improved multifold after 0*I permitted in ,hina (imilar increase in sourcing observed for Metro in India /rovides access to global markets for Indian producers. Investment in technology ,old storage chains solve the perennial problem of wastage. %reater investment in the food processing sector technology .etter operations in production cycle and distribution. .etter lifestyle %reater level of wages paid by international players usually More product variety $ewer product categories 'conomies of scale to help lower consumer price. Increased purchasing capacity of consumers

Manpower and skill development through retail training and %reater managerial talent inflow from other countries Tourism )e.elopment : & strong retailing sector boosts tourism as seen from the experience of (ingapore and *ubai. Investment in whole supply chain Improved product basket from India for exports. -ong term benefits,up#gradation of agriculture, development of efficient small and medium size industries. 0*I would result in market growth and expansion. 'mployment generated at various levels, Increased consumer demand implies employment generation across the value chain does not need very high skill sets, needs high school graduates and other similar skill level. ,urrently this is a ma!orly unemployed demographic group .oom in employment similar to !ob generation in IT'( industry. 1n a much larger scale .ut new !obs comparatively lower down the value chain %reater clarity and ob!ectivity can be achieved if one looks beyond kiranas at the larger issue of employment, *espite the entry of organized retail N domestic and foreign N in ,hina, its retail still employs 9 percent of the total workforce H only marginally smaller than IndiaI. The top <66 retailers in ,hina employ ;<6,666 people, a figure growing at over 47 percent every year. .ut compared with the J(, the percentage looks paltry. In the J(, almost <7 million people or <<.8 of the workforce are employed in retail. This is almost double the retail workforce in ,hina N and much higher than in IndiaR Many believe that organised retail actually leads to !ob gains rather than !ob losses. This is not to say that the changeover will be painless. (hifting of !obs is bound to happen. P(upermarket chains will divert business from small vendors, but they also create many !obs,Q argues retail expert %ale. 1ne reason for that is growth of organised retail stimulates consumption. &nd increased consumption means more production and therefore more !obs.In India, owners of large and small stores will tell you that they face stockouts N products not available when a consumer asks for it. This is lost demand. &nd it is due to India)s rather inefficient supply chain. 1ne could, therefore argue that India)s consumption is actually way below actual potential N and that there is inherent !ob loss of !obs that exists in the economy. Here poor distribution and below#par processes is another bottleneck. PIf the economy grows at 9.7 percent or so every year, we will have 7#8 years. If you do not have an efficient distribution chain, the economy cannot growT(uch inefficiency will lead to !ob losses. If you do not have organized distribution, you won)t have employment growth,Q argues Harsh .ahadur, managing director, Metro ,ash A ,arry, India. 0inally, if the fear of kiranas being snuffed out is true, then the government ought to be e"ually concerned about Indian retailers as well. (everal large and influential business groups like the Tatas and &mbanis have ambitious plans that include setting up of hundreds of supermarkets and hypermarkets. Bon)t these kill kiranas and lead to !ob losses. In realityF foreign retailers will be in a position to influence employment only several years after they enter India. .ut they will have an impact on the consumer almost immediately. 1f course, in India the consumer is invariably forgotten when protectionist lobbies voice their concern.

R8S8/R-6 %8(6O*O.O1G

O@&ectives of study The overall purpose of this endeavor is to investigate empirically customers) preference towards exclusive and multi brand retail outlets and to determine the factors that influence the satisfaction level of customers) in retail sector especially in -ucknow city. This study is also aimed at finding out the relation between ma!or demographic variables and satisfaction level of customers) and preference of retail formats. To study the preference given by consumers in term of "uality, ambience, service, scheme and location for retail purchase. Bhat are the factors affects for the purchaseW

Researc) *esign2 *escriptive research design will be used. (y#e2 *escriptive (tudy Sco#e2 combination of theoretical study as well as (tatistical (tudy 8nviron!ent2 0ield 2esearch

*ata Sources2

Primary )ata # (urvey of ,ustomers in -ucknow. It will be collected with the help of +uestionnaire Method and (urvey 2esearch. &s well as unstructured observation will also come in use at some part HtopicI of study.

Secondary )ata # It will be collected with the help of Internet, books, !ournals, articles of newspapers A magazines and research papers related to booming organized retail sector.

*ata /nalysis2 *ata will be analyzed with the help of certain statistical tools. 1. +uestionnaire method 2. Method of observation Sa!#ling *esign2 'o#ulation2 ,onsumers of -ucknow city Survey area2 ,onsumer located in different area of -ucknow city Sa!#ling !et)od2 $on#/robability ,onvenient sampling plan. Sa!#le size2 <66 consumers from -ucknow city

Significance of t)e Study2 To know the awareness of people about different brands of retail sector. 2esult will be the knowledge about customer)s preference towards exclusive and multi#brand retail outlet that will be helpful to find out the factors that influence the satisfaction level of customer. It will be helpful to know the connection between demographic factors of consumer like age, income, education and choice of people for different types of product.

.i!itations of t)e Study2

The present study is limited to the growth of retail sector in india only. The bias of respondents while responding cannot be eliminated. The study was limited to only in -ucknow city.

*elivery %et)od2 Two hard copies in form of booklets and two softcopies in form of ,*s.

0irst copy of pro!ect report will be submitted to pro!ect guide. (econd copy is participant)s own copy.

R8S8/R-6 /3/.GSIS

This research analysis is based on the answers given by the sample customers of -ucknow city in the above given consumer survey "uestionnaire.

/verage %ont)ly S)o##ing :udget of -onsu!ers2

The below given was the interpretation of the average monthly shopping budget for the sample size in the pro!ect survey. In the sample size most of the people Hi.e. :;>Iwere able to do shopping between 2s. 4666#7666.

<4>

8>

<>

6#4666 4:> 4666#7666 7666#<6666 <6666#46666 :;> 46666#76666 76666 A More

<5>

/wareness a@out different @rands of Retail Sector2

The store location, its customer services, discount schemes and offers, its "uality are the important factors for the awareness of the any retailing company or brand but apart from all these the most important thing which influence the awareness of any particular brand is it)s advertising and other promotional activities. .ig .azaar of future group in -ucknow is very well know brand among the people of sample because of it)s pricing, attractive offers and discounts and its very good promotional and marketing activities. The Dishal Mega Mart is also famous because of its reach in the various areas of the city.

<46 <66 ;6 96 =6 46 6 .ig .azar Dishal Mega Mart (hoppers (top -andmark Best (ide

7)ic) Retail c)ain -usto!ers li,e to visit often2

.ecause of it)s attractive pricing and good schemes and offers people like to visit .ig .azaar most often. Dishal Mega Mart is also giving attractive discount on formal wear so it is also known for good footfall. (hoppers stop do not have discount offers and schemes but it is still liking of some of people in sample size because of its ambience, shopping comfort and good customer services.

-andmark <<> (hoppers (top <8>

Best (ide 5>

.ig .azar :9>

Dishal Mega Mart 48>

-usto!er 'references for s)o##ing fro! Retail c)ains2

The consumers of sample size were visiting the big retail outlets most because of their good pricing and for their attractive schemes and discounts offers. &fter that they also going there for the "uality experience. The location of the store is also a big concern for the consumers. Thereafter they are also looking for good customer services. They want to get well treated by the sales persons of the stores. &mbience came in last for all of them.

*iscount (chemes +uality -ocation ,ustomer (ervice &mbience

Conclusion
()e consu!er4s #references are c)anging ra#idity and @eco!ing )ig)ly diversified. It is difficult for t)e retail stores to satisfy all t)e needs of t)e custo!ers. ()e !ost of t)e consu!er4s want to get so!e attractive #ricesC good sc)e!es and offers on every #urc)ases and a s)o##ing co!fort as well. ()ose w)o are a@le to #urc)ase t)eir needs and want for a !ont) in a @ul, #refers to go to t)e retail c)ains. :ecause of co!#etitions in t)e !ar,et t)e @randed for!als are also @eca!e c)ea#er so t)e younger generation #refers to #urc)ase fro! t)e retail outlets of t)e @rand t)e city. Only t)e @ig retail c)ains are a@le to satisfy all t)ese needs of t)e new age consu!ers w)ereas t)ere is still so!e consu!ers !ostly of t)e old age are willing to #urc)ase fro! t)e local ,irana store. So!e of t)e! )ave #erce#tion t)at t)ese @ig stores are too costly to afford and so!e of t)e! are not a@le to !a,e #urc)ases in a @ul, so t)ey do not want to waste t)eir ti!e to go es#ecially to t)e @ig store for 2;3 ite!s #urc)ase. In t)e case of ot)er ite!s li,e wristwatc)esC @randed &ewelryC !o@ilesC gift ite!s and ot)erC t)ey #refer to ta,e it fro! w)ere t)ey are getting c)ea# #ricesC good after sales services and t)e goodwill of t)e store. /fter studying t)e custo!er survey 0uestionnaire statistically and t)eoretically as well and after o@serving t)e consu!er4s !ood and t)eir #references I can say t)at :ig Retail is )ere to stay. /ssu!ing t)at i!#rove!ents in infrastructure and lower real estate costs @eco!e a realityC :ig Retail still )as a long way to go @efore satisfying t)e )ig)ly diverse needs of t)e Indian #o#ulation. /s a resultC t)ere will @e a steady state w)ere :ig Retail will co;eIist wit) S!all Retail.

ENDI,

CONS#MER S#R$E% &#EST'ONNA'RE RETA'L C(A'NS

The o!<ecti.e o" this sur.ey is to collect tan i!le in"ormation a!out shoppin in Retail Chains9 This =uestionnaire is !ein administered to people li*e you +ho ha.e .isited and !ou ht products in Retail Chains9 Please let us *no+ your spontaneous response to the =uestions that pertain to your shoppin e/perience in Retail Chains9 All in"ormation pro.ided !y you shall !e *ept con"idential and +e shall only !e pu!lishin the outcomes9 Please pro.ide us your un!iased and "ran* opinions9

:. What is your month*y sho--ing +udgetB ;-2C 2-5C 5-:;C :;-2;C 2;-5;C D5;C

2. Whi,h retai* ,hains did you visit B 'ig 'a?aar <ho--ers <toWestside Landmark "isha* Megamart Any other (!*ease s-e,ify) EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE 3. Whi,h retai* ,hains do you visit oftenB 'ig 'a?aar <ho--ers <toWestside Landmark "isha* Megamart

Any other (!*ease s-e,ify) EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE 4. Whi,h retai* ,hain did you *ike mostB 'ig 'a?aar <ho--ers <toWestside Landmark "isha* Megamart Any other (!*ease s-e,ify) EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE

5. Why did you *ike that -arti,u*ar retai* ,hainB Am+ien,e Attra,tive !ri,es Wide range of ,hoi,es #is,ount <,hemes =ree Fffers (ustomer <ervi,e Any Fther (!*ease <-e,ify) EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE 6. Mark on a s,a*e of -3 to G3 your -er,e-tions a+out your sho--ing e/-erien,e in the fo**owing retai* ,hains (where -3 indi,ates inferior and G 3 indi,ates su-erior) H =eature Am+ien,e Attra,tive !ri,es Range of (hoi,es !ri,e #is,ounts =ree+ies <a*es-eo-*e 'ehavior !arking =a,i*ities (onvenien,e Home #e*ivery 'ig "isha* Westside <ho--ers Landmark 'a?aar Megamart <to:5 7; 65 8; 6; 5;

7. Whi,h -rodu,ts do you norma**y +uy from retai* ,hainsB EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE

EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE 8. Whi,h -rodu,ts do you norma**y +uy from your *o,a* gro,ery storeB EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE

9. Whi,h -rodu,ts do you norma**y +uy from your ,hemist sho-B EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE :;. Why do you *ike to +uy from *o,a* gro,ery storeB EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE ::. Why do you *ike to +uy from ,hemist sho-sB EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE EEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEEE :2. How mu,h time do you s-end in the retai* ,hain on every visitB ;-3; Minutes 3-4 Hours 3;-6; Minutes 4-5 Hours :-2 Hour I5 Hours 2-3 Hours

:3. he emergen,e of retai* ,hains wi** ,reate unem-*oyment -ro+*emsH

<trong*y Agree Agree Neither Agree Nor #isagree #isagree <trong*y #isagree

:4. he emergen,e of retai* ,hains wi** destroy so,ia* harmonyH

<trong*y Agree

Agree

Neither Agree nor #isagree

#isagree

<trong*y #isagree

:5. he emergen,e of retai* ,hains wi** ,ause mono-o*isti, ,ontro* over -ri,esH
<trong*y Agree Agree Neither Agree Nor #isagree #isagree <trong*y #isagree

:6. =#I in Retai* <e,tor wi** ,ontri+ute to the 1rowth MomentumH

<trong*y Agree Agree Neither Agree Nor #isagree #isagree <trong*y #isagree.

)emo raphics
1. Name: 2. Age: 3. Occupation: _______________ 4. +ncome g$oup: 5. ducation: ______________________________________________________ 15-20 40-50 20-30 50 & above 30-40

Student Govt. mp!o"ee #$ivate mp!o"ee %u&ine&&man An" ot'e$ (#!& &peci)"* 5,-10, 40,-50, Student -%A 10,-20, 20,-30, 50, & above 30,-40,

G$aduate #o&t-G$aduate An" ot'e$ (#!& &peci)"* ___________________ /ive

.. Numbe$ o) /ami!" 0ependant&: Ni! One 12o An" ot'e$ (#!& &peci)"* 3. 1e!ep'one Numbe$ 4 mai!:___________________________________________

KKKKKKKKKKKKKKKKKKKKKKKKKKKKKKKK ()an, GouKKKKKKKKKKKKKKKKKKKKKKKKKKKKKK

References
7e@ Sites and Searc) 8ngines www.indiabiznews.com www.fashion4fibre.com www.indiainfoline.com www.e"uitymaster.com www.economywatch.com www.google.com www.rediff.com www.ibef.org

3ews#a#ers The Times 1f India The Indian 'xpress The 'conomic Times 0inancial 'xpress .usiness (tandard .usiness -ine

:oo,s and %agazines .usiness Borld The Indian *ream .usiness A 'conomy