A

Project Study Report

On

A Comparative Study of Service Quality of

Big Bazaar and Easy Day
Submitted in partial fulfillment for the
Award of Degree of
Master of Business Administration

Submitted By:
Kapil Godara
MBA- 4th semester

Engineering College Bikaner

(An Autonomous Institution of Govt. of Rajasthan)
Karni Industrial Area, Pugal Road, Bikaner

DECLARATION
Hereby I declare that the project report entitled A Comparative Study of
Service Quality of Big Bazaar and Easy Day submitted for the degree of
master of business administration is my original work and the project report has
not formed the basis for the award of any diploma, degree associate ship,
fellowship or similar other titles.
It has not been submitted to any other university or institution for the award of
any degree or diploma.

Place:

Kapil Godara

Date:

MBA 4th Sem.

CERTIFICATE

This is certified that Mr. Kapil Godara, student of Master of Business

Administration, Fourth Semester of Engineering College,Bikaner has completed
his Project report on the topic of A comparative study of Service Quality of
Big Bazaar and Easy Day under supervision of Gaurav Bissa(Associate
Professor , DMT).

To best of my knowledge the report is original and has not been copied or
submitted anywhere else. It is an independent work done by him.

Dr. Gaurav Bissa

Associate Proffesor, DMT

PREFACE
Theoretical study combined with practical knowledge makes the learning
meaningful and enables the individuals to develop self-confidence. Often
repeated but correctly said that one cannot learn to swim without diving in the
water and so the MBA curriculum has been designed to provide to the future
managers ample practical exposure of the business world.
The Project report is a compulsory part for the fulfillment of the MBA degree
course and helps the student to gain knowledge about various aspect of the
industry, emphasizing on the development of skills analyzing and interpreting
practical problems through application of theory concepts and techniques of
management.
This project focuses on the service quality provided by the two retail giants in
India i.e. Big Bazaar and Easy Day and it pertains to compare the quality of
service for different aspects in both the retailer chains.I took my project study of
Big Bazaar and Easy Day at Jaipur city in Rajasthan. My job during the project
was to study of the behavior and perception of customers towards the services of
Big Bazaar and Easy Day and find out which retail organization is more popular
and effective among thecustomers in Jaipur.
Now I take this opportunity to present the project report and sincerely hope that it
will be as much knowledge enhancing to the readers as it was to use during the
fieldwork and the completion of the report.

ACKNOWLEDGEMENT
An individual cannot do project of this scale. I take this opportunity to express my
acknowledgement and deep sense of gratitude to the individuals for rendering
valuable assistance and gratitude to me. Their inputs have played a vital role in
success of this project.
I express my sincere thanks to my project guide Gaurav Bissa, Designation
Faculty, Department of Management Technology Engineering College, Bikaner,
for her generous support, constant direction and mentoring at all stages of
project and was a real source of help and assistance to me during the course of
project.
It gives me immense pleasure to thank all those who had helped me directly or
indirectly to complete this Dissertation Report.

Kapil Godara

EXECUTIVE SUMMARY
To conduct the Comparative Study of Service Quality of Big Bazaar and Easy
Day, I used some service quality measure as the basis to analyze the data to
obtain genuine information regarding customer choice and preferences among
the services provided by both the retailers. We know that there are several retail
chainsin India but Big Bazaar and Easy Day are extensively used by people in
Jaipur city. Big Bazaar is well sustained and biggest retail chain in India, while
Easy Day is in infant stage in Indian market but due to its association with the
another giant, Bharti Retail, it generated eagerness and people looked for some
more quality services from it and this factor initiated me to choose this topic as it
seemed very interesting to compare the services of the biggest retailer and a
new entrant.
We know that people expect good and satisfactory servicesandit is said that
success is the result of a good plan well executed. For a retailer, plans are
mostly formulated at corporate headquarter and executed in their stores. Service
quality can be assessed for factors that include choosing the assortment of
products to carry in each store at each point in time, setting store inventory levels
and product prices, setting staffing levels, determining how many stores to have
and where they are located and creating the physical design of stores and plan
grams that specify the location of all products within each store. Services quality
helps the customer to analyze the store.Services provided by the retail store
shows what type of retail store it is.

TABLE OF CONTENTS
S.NO

CONTENT

PAGE NO.

1.

INTRODUCTION TO INDUSTRY

1 - 13

2.

INTRODUCTION TO ORGANIZATION

14 -37

3.

REVIEW OF LITERATURE

38 76

4.

RESEARCH METHODOLOGY

77 81

4.1. Title of study

4.2. Duration of the project
4.3. Objective of the project
4.4. Type of research
4.5. Sample size and method of selecting sample
4.6. Scope of the study
4.7. Limitations of the study
5.

FACTS AND FINDINGS

82 83

6.

DATA ANALYSIS AND INTERPRETATION

84 - 97

7.

SWOT ANALYSIS

98 - 101

8.

CONCLUSION

102103

9.

RECOMMENDATIONS AND SUGGESTIONS

104 106

10.

APPENDIX

107 109

11.

BIBLIOGRAPHY

110 - 115

-1INTRODUCTION TO THE
INDUSTRY

INTRODUCTION TO INDIAN RETAIL INDUSTRY

History of Indian retail sector:
The Indian retail industry is divided into organized and un-organized sectors.
Organized retailing refers to trading activities undertaken by licensed retailers,
that is, those who are registered for sales tax, income tax, etc. These include the
corporate-backed hypermarkets and retail chains, and also the privately owned
large retail businesses. Unorganized retailing, on the other hand, refers to the
traditional formats of low-costretailing, for example, the local kirana shops, owner
manned general stores, shops, convenience stores, hand cart and pavement
vendors, etc.
Indias retail sector is wearing new clothes and with a three-year compounded
annual growth rate of 46.64 per cent, retail is the fastest growing sector in the
Indian economy.
Traditional markets are making way for new formats such as departmental
stores,hypermarkets, supermarkets and specialty stores. Western-style malls
have begun appearing in metros and second-rung cities alike, introducing the
Indian consumer to an unparalleled shopping experience.The Indian retail sector
is highly fragmented with 97 percent of its business being runby the unorganized
retailers like the traditional family run stores and corner stores.
The organized retail however is at a very nascent stage though attempts are
being made to increase its proportion to 9-10 per cent by the year 2011 bringing
in a huge opportunityfor prospective new players. The sector is the largest
source of employment after agriculture, and has deep penetration into rural India
generating more than 10 percent of Indias GDP.
On one hand where markets in Asian giants like China are getting saturated, the
AT Kearney's 2006 Global Retail Development Index (GRDI), for the second
consecutive year Placed India the top retail investment destination among the 30
emerging markets across the world.

Over the past few years, the retail sales in India are hovering around 33-35 per
cent of GDP as compared to around 20 per cent in the US. The table gives the
picture of Indias retail trade as compared to the US and China.
The last few years witnessed immense growth by this sector, the key drivers
being changing consumer profile and demographics, increase in the number of
international brands available in the Indian market, economic implications of the
Government increasing urbanization, credit availability, improvement in the
infrastructure, increasinginvestments in technology and real estate building a
world class shopping environmentfor the consumers. In order to keep pace with
the increasing demand, there has been ahectic activity in terms of entry of
international labels, expansion plans, and focus ontechnology, operations and
processes.This has lead to more complex relationships involving suppliers, third
party distributorsand retailers, which can be dealt with the help of an efficient
supply chain. A propersupply chain will help meet the competition head-on,
manage stock availability; supplierrelations, new value-added services, cost
cutting and most importantly reduce thewastage levels in fresh produce.

Present scenario in Indian retail Industry:

Large Indian players like Reliance, K Rahejas, Bharti Airtel, ITC and manyothers
are making significant investments in this sector leading to emergence of
bigretailers who can bargain with suppliers to reap economies of scale. Proper
infrastructure is a pre-requisite in retailing,which would help to modernize India
and facilitate rapid economic growth. This wouldhelp in efficient delivery of goods
and value-added services to the consumer making ahigher contribution to the
GDP.
International retailers see India as the last retailing frontier left as the Chinas
retail sectoris becoming saturated. However, the Indian Government restrictions
on the FDI arecreating ripples among the international players like Walmart,
Tesco and many otherretail giants struggling to enter Indian markets. As of now
the Government has allowedonly 51 per cent FDI in the sector to one-brand
shops like Nike, Reebok etc. However,other international players are taking
3

alternative routes to enter the Indian retail marketindirectly via strategic licensing
agreement, franchisee agreement and cash and carrywholesale trading (since
100 per cent FDI is allowed in wholesale trading).
Retail Sector is the most booming sector in the Indian economy. Some of the
biggest players of the world are going to enter into the industry soon. It is on the
threshold of a big revolution after the IT sector. Although organized retail market
is not as strong as of now, but it is expected to grow manifolds by the year 2012.
The sector contributes 10% of the GDP, and is estimated to show 20% annual
growth rate by the end of the decade. CRISIL report says that the retail market is
most fragmented in India and only 2% of the entire retailing business is in the
organized sector. There are about 300 new malls, 1500 supermarkets and 325
departmental stores being built in the cities very soon.
The retail boom will face a strong competition from the 12 million mom-and-pop
stores, which are easily accessible and approachable and provide services like
free home delivery and goods at credit. But buying from Malls, Supermarkets and
Department stores gives a different feeling and the environment of pick and
choose from a variety of products. A number of retail giants are also going to
explore the market such as Reliance Retail Ltd and Wal-mart. The revolution is
driven by large expectations where both domestic and international players will
be channel through which other large stores in India are spreading themselves
across the Estimates and predictions for retail sector:

At present, the industry is estimated to be at more than US$ 400 billion.

The Economist Intelligence Unit (EIU) estimates the retail market in India
will increase to US$608.9 billion in 2009 from US$394 billion in 2005.

KPMG Report says that the organized retail would grow at a higher rate
than the GDP in the next five years.

The retail sector would generate employment for more than 2.5 million
people by the year 2011.

Growth in Indian retail sector:

Retailing is one of the pillars of the economy in India and accounts for 13% of
GDP.Most Indian shopping takes place in open markets and millions of
independent grocery shops called kirana. Organized retail such supermarkets
accounts for just 4% of the market as of 2008. Regulations prevent most foreign
investment in retailing. Moreover, over thirty regulations such as "signboard
licenses" and "anti-hoarding measures" may have to be complied before a store
can open doors. There are taxes for moving goods to states, from states, and
even within states.An increasing number of people in India are turning to the
services sector for employment due to the relative low compensation offered by
the traditional agriculture and manufacturing sectors. The organized retail market
is growing at 35 percent annually while growth of unorganized retail sector is
pegged at 6 percent.
The Retail Business in India is currently at the point of inflection. Rapid change
with investments to the tune of US $ 25 billion is being planned by several Indian
and multinational companies in the next 5 years. It is a huge industry in terms of
size and according to management consulting firm Technopak Advisors Pvt. Ltd.,
it is valued at about US $ 350 billion. Organized retail is expected to garner about
16-18 percent of the total retail market (US $ 65-75 billion) in the next 5 years.
India has topped the A.T. Kearneys annual Global Retail Development Index
(GRDI) for the third consecutive year, maintaining its position as the most
attractive market for retail investment. The Indian economy has registered a
growth of 8% for 2007. The predictions for 2012 are 9-10%. The enormous
growth of the retail industry has created a huge demand for real estate. Property
developers are creating retail real estate at an aggressive pace and by 2011, 300
malls are estimated to be operational in the country.
With over 1,000 hypermarkets and 3,000 supermarkets projected to come up by
2012, India will need additional retail space of 700,000,000 sq ft (65,000,000 m2)
5

as compared to today. Current projections on construction point to a supply of

just 200,000,000 sq ft (19,000,000 m2), leaving a gap of 500,000,000 sq ft
(46,000,000 m2) that needs to be filled, at a cost of US$1518 billion.
According to the ICRIER report, the retail business in India is estimated to grow
at 13% from $322 billion in 2006-07 to $590 billion in 2012-12. The unorganized
retail sector is expected to grow at about 10% per annum with sales expected to
rise from $ 309 billion in 2006-07 to $ 496 billion in 2012-12.

The Indian Retail Market

Indian market has high complexities in terms of a wide geographic spread and
distinct consumer preferences varying by each region necessitating a need for
localization even within the geographic zones. India has highest number of
outlets per person (7 per thousand) Indian retail space per capita at 2 sq ft
(0.19 m2)/ person is lowest in the world Indian retail density of 6 percent is
highest in the world. 1.8 million households in India have an annual income of
over 45 lac (US$99,900).
Delving further into consumer buying habits, purchase decisions can be
separated

into

two

categories:

status-oriented

and

indulgence-oriented.

CTVs/LCDs, refrigerators, washing machines, dishwashers, microwave ovens

and DVD players fall in the status category. Indulgence-oriented products include
plasma TVs, state-of-the-art home theatre systems, iPods, high-end digital
cameras, camcorders, and gaming consoles. Consumers in the status category
buy because they need to maintain a position in their social group. Indulgenceoriented buying happens with those who want to enjoy life better with products
that meet their requirements. When it comes to the festival shopping season, it is
primarily the status-oriented segment that contributes largely to the retailers
cash register.
While India presents a large market opportunity given the number and increasing
purchasing power of consumers, there are significant challenges as well given
6

that over 90% of trade is conducted through independent local stores.

Challenges include: Geographically dispersed population, small ticket sizes,
complex distribution networkand little use of IT systems, limitations of mass
media and existence of counterfeit goods.

Major Indian Retailers

Indian apparel retailers are increasing their brand presence overseas, particularly
in developed markets. While most have identified a gap in countries in West Asia
and Africa, some majors are also looking at the US and Europe. Arvind Brands,
Madura Garments, Spykar Lifestyle and Royal Classic Polo are busy chalking out
foreign expansion plans through the distribution route and standalone stores as
well. Another denim wear brand, Spykar, which is now moving towards becoming
a casualwear lifestyle brand, has launched its store in Melbourne recently. It
plans to open three stores in London by 2008-end.
The low-intensity entry of the diversified Mahindra Group into retail is unique
because it plans to focus on lifestyle products. The Mahindra Group is the fourth
largest Indian business group to enter the business of retail after Reliance
Industries Ltd, the Aditya Birla Group, and Bharti Enterprises Ltd. The other three
groups are focusing either on perishables and groceries, or a range of products,
or both.

Next retail India Ltd (Consumer Electronics)(www.next.co.in)

PGC Retail -T-Mart India[2], Switcher , Respect India , Grand India Bazaar

REI AGRO LTD Retail-Formats:6TEN Hyper & 6TEN Super

RPG Retail-Formats: Music World, Books & Beyond, Spencers Hyper,

Spencers Super, Daily & Fresh

Pantaloon Retail-Formats: Big Bazaar, Food Bazaar, Pantaloons, Central,

Fashion Station, Brand Factory, Depot, aLL, E-Zone etc.

Marks & Spencer: Clothing, lifestyle products, etc.

The Tata Group-Formats: Westside, Star India Bazaar, Steeljunction,

Landmark, Titan Industries with World of Titans showrooms, Tanishq
outlets, Chroma.

K Raheja Corp Group-Formats: Shoppers Stop, Crossword, Hyper City,

Inorbit Mall.

Lifestyle International-Lifestyle, Home Centre, Max, Fun City and

International Franchise brand stores.

Pyramid Retail-Formats: Pyramid Megastore, TruMart

Nilgiris-Formats: Nilgiris supermarket chain

Subhiksha-Formats: Subhiksha supermarket pharmacy and telecom

discount chain.

Trinethra- Formats: Fabmall supermarket chain and Fabcity hypermarket

chain

Vishal Retail Group-Formats: Vishal Mega Mart

BPCL-Formats: In & Out

Reliance Retail-Formats: Reliance Fresh

Reliance ADAG Retail-Format: Reliance World

German Metro Cash & Carry

Shoprite Holdings-Formats: Shoprite Hyper

Paritala stores bazar: honey shine stores

Aditya Birla Group - more Outlets

Kapas- Cotton garment outlets

Entry of MNCs in India

The world's largest retailers by sales, Wal-Mart Stores Inc and Sunil Mittal's
Bharti Enterprises have entered into a joint venture agreement and they are
planning to open 10 to 15 cash-and-carry facilities over seven years. The first of
the stores, which will sell groceries, consumer appliances and fruits and
vegetables to retailers and small businesses, is slated to open in north India by
the end of 2008.Carrefour, the worlds second largest retailer by sales, is
planning to setup two business entities in the country one for its cash-and-carry
8

business and the other a master franchisee which will lend its banner, technical
services and know how to an Indian company for direct-to-consumer retail.
The worlds fifth largest retailer by sales, Costco Wholesale Corp (Costco) known
for its warehouse club model is also interested in coming to India and waiting for
the right opportunity.
Opposition to the retailers' plans has argued that livelihoods of small scale and
rural vendors would be threatened. However, studies have found that only a
limited number of small vendors will be affected and that the benefits of market
expansion far outweigh the impact of the new stores.
Tesco plans to set up shop in India with a wholesale cash-and-carry business
and will help Indian conglomerate Tata group to grow its hypermarket business.

Challenges to Indian retail sector

To become a truly flourishing industry, retailing needs to cross the following
hurdles:

Automatic approval is not allowed for foreign investment in retail.

Regulations restricting real estate purchases, and cumbersome local laws.

Taxation, which favors small retail businesses.

Absence of developed supply chain and integrated IT management.

Lack of trained work force.

Low skill level for retailing management.

Lack of Retailing Courses and study options

Intrinsic complexity of retailing rapid price changes, constant threat of

product obsolescence and low margins.

To overcome some of the challenges faced by modern retail, the country is

developing a support infrastructure in form of specialized retail schools.

One such skill development initiative has been taken by TKWs Group. Its TKWs
Retail School has already training over a thousand students and retail
professionals for different retail skills. TKWs Retail School is also associated with
government projects like enhancing retail experience of foreign tourists,
improving retail of handicraft and local produce, skill development of village
youth.

Current Status in retail

Indias retail industry accounts for 10 percent of its GDP and 8 percent of
theemployment to reach $17 billion by 2011.The Indian retail market is estimated
at US$ 350 billion. But organized retail is estimatedat only US$ 8 billion.
However, the opportunity is huge-by 2011, organized retail isexpected to grow at
6 per cent by 2011 and touch a retail business of $ 17 billion asagainst its current
growth level of 3 per cent which at present is estimated to be $ 6billion, according
to the Study undertaken by The Associated Chambers of Commerceand Industry
of India (ASSOCHAM).
Indian retailing is clearly at a tipping point.Organized retail in India has the
potential to add over Rs. 2,000 billion (US$45 billion)business by the Year 2011
generating employment for some 2.5 million people in variousretail operations
and over 10 million additional workforce in retail support activitiesincluding
contract production & processing, supply chain & logistics, retail real
estatedevelopment & management etc.
It is estimated that it will cross the $650-billion mark by 2012, with an already
estimatedinvestment of around $421 billion slated for the next four years.
As noticed in the figure above, the Organized Retail Penetration (ORP) is the
highest infootwear with 22 per cent followed by clothing.
Though food and grocery account forlargest share of retail spend by the
consumer at about 76 per cent, only 1 per cent of thismarket is in the organized
sector.
However, it has been estimated that this segmentwould multiply five times taking
the share of the organized market to 30 percent in thecoming years.
10

Indian retail sector is witnessing one of the most hectic Marketing activities of all
times. The companies are fighting to win the hearts of customer who is God said
by the business tycoons. There is always a first mover advantage in an
upcoming sector. In India, that advantage goes to BIG BAZAAR. It has brought
about many changes in the buying habits of people. It has created formats, which
provide all items under one roof at low rates, or so it claims. In this project, we
will study the in depth comparison between service quality provided by Big
Bazaar and a recent entrant Easy Day by the venture of Bharti Airtel, India and
Wal-Mart, USA .
Service quality in India:
Of all services marketing topics, service quality has gained much research
prominence in recent years. Existing research indicates that consumers satisfied
with service quality are most likely to remain loyal. Service quality is perceived as
a tool to increase value for the consumer; as a means of positioning in a
competitive environment and to ensure consumer satisfaction, retention and
patronage. With greater choice and increasing awareness, Indian consumers
are more demanding of quality service and players can no longer afford to
neglect customer service issues.
The basic difference between the services provided by Big Bazaar and Easy Day
would be beneficial for the people who want to choose the services among these
retailers and the study will also provide specific idea to the governing bodies of
this sector how to compete and increase the service quality comparing to the
other retailer.
Measuring service quality: SERVQUAL and RSQS:
SERVQUAL
Much of the attention focused on the service quality construct is attributable to
the SERVQUAL, instrument developed by Parasuraman, Zeithaml& Berry in
1988 for measuring service quality. Several studies subsequently employed the
SERVQUAL to measure service quality and to assess the validity and reliability
of the scale across a wide range of industries and cultural contexts.
11

Little is known about service quality perceptions in India because research focus
has primarily been on developed countries. Given the relatively mature markets
where the service quality scales have been developed, it seems unlikely that
these measures would be applicable to India without adaptation.
Experts examined the SERVQUAL in the retail banking industry and reported a
poor fit of the scale to the empirical data. Despite this, several researchers have
used the SERVQUAL scale in similar settings with no assessment of the
psychometric soundness of the scale.
RSQS:
Service quality in retailing is different from any other product/service
environment. For this reason, in 1996, Dabholkar, Thorpe and Rentz developed
the Retail Service Quality Scale (RSQS) for measuring retail service quality. The
RSQS has a five dimensional structure of which three dimensions comprise of
two sub-dimensions each.
Studies assessing the applicability of the RSQS have reported encouraging
results. These researchers replicated their own study and found all the RSQS
dimensions and sub-dimensions to be valid in the U.S. It was also found that the
RSQS five dimensional structure appropriate for measuring the service quality
perceptions of supermarket consumers in international market.
Researchers reported the RSQS a useful scale for measuring service quality of
discount stores across different cultural contexts of different countries, though
they reported empirical support for a four and not a five dimensional structure.
Reports provided highly encouraging results for the RSQS applicability in the
context of department stores, specialty stores and hypermarkets.
This study evaluates the applicability of these measuring scales for measuring
service quality in the Indian context with special reference to Big Bazar and Easy
day. If these measures found to be valid and reliable, that will be effective
instruments available to Indian retailers.

12

The 5 Dimensions of SERVQUAL or RATER model:

Service providers want to know what customers care about. Service quality is a
good guess. Price, and to a minor degree product quality, also count. But for
service providers, customers care most about service quality. After extensive
research, Zeithaml, Parasuraman and Berry found five dimensions customers
use when evaluating service quality. They named their survey instrument
SERVQUAL.If providers get these dimensions right, customers will hand over the
keys to their loyalty. Because they will receive service excellence, according to
what's important to them.
The five SERVQUAL dimensions are:

TANGIBLES-Appearance of physical facilities, equipment, personnel, and

communication materials.

RELIABILITY-Ability to perform the promised service dependably and

accurately

RESPONSIVENESS-Willingness to help customers and provide prompt

service

ASSURANCE-Knowledge and courtesy of employees and their ability to

convey trust and confidence.

EMPATHY-Caring, individualized attention the firm provides its customers.

A 6th criterion was proposed by Gronroos in 1988: RECOVERY.

It has the same effect as the junk yard strategy, which is used to support the zero
defects strategy. The customer needs to stay happy. Since there are many bad
services being delivered to the customer and according to latest researches 12
good service encounters are needed to make up a bad one, the criteria recovery
can play an important role.

13

-2INTRODUCTION TO THE
ORGANIZATIONS

14

Big Bazaar was launched in September, 2001 with the opening of three stores in
Calcutta, Bangalore and Hyderabad in 22 days. Within a span of ten years, there
are now 148 Big Bazaar stores in 80 cities and towns across India.Big Bazaar is
not just another hypermarket. It caters to every need of your family. Where Big
Bazaar scores over other stores is its value for money proposition for the Indian
customers.
At Big Bazaar, customers can definitely get the best products at the best prices that's what they guarantee. With the ever increasing array of private labels, it has
opened the doors into the world of fashion and general merchandise including
home furnishings, utensils, crockery, cutlery, sports goods and much more at
prices that will surprise you. And this is just the beginning. Big Bazaar plans to
add much more to complete customers shopping experience.
Big Bazaar is designed as an agglomeration of bazaars or Indian markets with
clusters offering a wide range of merchandise including fashion and apparels,
food products, general merchandise, furniture, electronics, books, fast food and
leisure and entertainment sections.
In 2006-2007, more Indians discovered the value of shopping in Big Bazaar. And
with the launch of each store, we discovered more value in terms of operational
efficiency. Big Bazaar launched 27 new stores in 22 cities, covering over 1.40
million square feet. As of June 2007, there were 56 Big Bazaar stores across 43
cities. While Big Bazaar continued to expand in the large cities, it also tapped
consumption potential in smaller cities like Agra, Allahabad, Coimbatore, Surat,
Panipat, Palakkad, Kanpur andKolhapur.
15

The year under review also witnessed realigning of business teams with shared
experience in category management, sourcing, front-end operations and
business planning. In addition, separate teams have been formed to look into all
aspects of new store launches and to manage mature stores. This provides more
flexibility and focus in expansion plans.The increase in SKUs in existing
categories and the introduction of new categories encouraged the opening of
larger stores or Super centers, measuring 100,000 square feet or more. There
are now 5 Big Bazaar Super Centers. Considering this scale of expansion,
technology plays a significant facilitating role. The introduction of SAP in 2005-06
and its roll out during the year positively impacted the business.
Food Bazaar, a supermarket format was incorporated within Big Bazaar in 2002
and is now present within every Big Bazaar as well as in independent locations.
There are now 169 Food Bazaar outlets, including those located within Big
Bazaar.Based on the companys in-house consumer data and research, and in
cognizance with observations on customer movements and the shopping
convenience factor, Food Bazaar has initiated certain refurbishments and layout
design across all stores. The intention is to continuously change with the times
and demands of the evolving Indian consumer.
Food Bazaar also witnessed healthy expansion during the year 2006-07, making
its presence felt in nearly 26 cities and adding 40 stores during the year under
review. The total count of Food Bazaars as on 30th June 2007 stood at 86
stores. The year under review witnessed the companys private label program
gaining significant attraction. The brands have been very competitive vis--vis
the established brands in quality and price terms, and have in fact scored better
than national or international players in certain categories. The share of private
labels as a percentage of total Food Bazaar revenues has increased significantly
and comprises nearly 50 merchandise categories.
While Fresh & Pure brand entered categories like cheese slices, frozen peas,
honey, packaged drinking water and packaged tea, the Tasty Treat brand
16

received a very favorable response in new categories like bhujiya and wafers. In
the home care category, Caremate launched aluminum foil and baby diapers
while Cleanmate launched detergent bars and scrubbers.
A new format BB Wholesale Club was launched and 4 such stores have been
opened so far. To be managed by Food Bazaar from the ensuing financial year,
this format sells only multi-packs and bulk packs of a select range of fast moving
categories and caters to price sensitive customers and smaller retailers. The
company has also forged tie-ups with established companies like ITC, Adanis,
DCM Group, USAID and other farm groups in Maharashtra and Madhya Pradesh
to source directly from them. These alliances are expected to drive efficiencies
as well as bring better products to consumers. By the end of FY 07-08, the total
number of Food Bazaar stores was expected to be 200.
A typical Big Bazaar is spread across around 50,000 square feet of retail space.
While the larger metropolises have Big Bazaar Familycenters measuring
between 75,000 square feet and 1,60,000 square feet, Big Bazaar Express
stores in smaller towns measure around 30,000 square feet.Most of the Big
Bazaar stores are multi-level and are located in stand-alone buildings in city
centers as well as within shopping malls. These stores offer over 200,000 SKUs
in a wide range of categories led primarily by fashion and food products.Big
Bazaar has initiated the process of Auto Replenishments Systems, thus
improving operational efficiencies and productivity. The company has also
rationalized nearly 250 vendors through better vendor management in terms of
potential to expand, and for inclusion and upgradation to the online B2B platform.
In FY 2008, the company opened the 100th Big Bazaar store which marked the
fastestever expansion by a hypermarket format.
Big Bazaar is part of Future Group and is owned through a wholly owned
subsidiary of Pantaloon Retail IndiaLimited that is listed on Indian stock
exchanges.

17

Group Vision
Future Group shall deliver Everything, Everywhere, Every time for Every Indian
Consumer in the most profitable manner.
Group Mission

We share the vision and belief that our customers and stakeholders shall
be served only by creating and executing future scenarios in the
consumption space leading to economic development.

We will be the trendsetters in evolving delivery formats, creating retail

realty, making consumption affordable for all customer segments for
classes and for masses.

We shall infuse Indian brands with confidence and renewed ambition.

We shall be efficient, cost- conscious and committed to quality in whatever

we do. We shall ensure that our positive attitude, sincerity, humility and
united determination shall be the driving force to make us successful.

18

Core Values
Indian-ness: Confidence in ourselves.
Leadership: To be a leader, both in thought and business.
Respect & Humility: To respect every individual and be humble in our conduct.
Introspection: Leading to purposeful thinking.
Openness: To be open and receptive to new ideas, knowledge and information.
Valuing and Nurturing Relationships: To build long term relationships.
Simplicity & Positivity: In our thought, business and action.
Adaptability: To be flexible and adaptable, to meet challenges.
Flow: To respect and understand the universal laws of nature.
Future the word which signifies optimism, growth, achievement, strength,
beauty, rewards and perfection. Future encourages us to explore areas yet
unexplored, write rules yet unwritten; create new opportunities and new
successes. To strive for a glorious future brings to us our strength, our ability to
learn, unlearn and re-learn our ability to evolve.
Future Group will not wait for the Future to unfold itself but create future
scenarios in the consumer space and facilitate consumption because
consumption

is development. Thereby,

development

for

customers,

employees,

they

will effect

shareholders,

socio-economic
associates

and

partners.Customers will not just get what they need, but also get them where,
how and when they need.
Future Group, led by its founder and Group CEO, Mr. Kishore Biyani, is one of
Indias leading business houses with multiple businesses spanning across the
consumption space. While retail forms the core business activity of Future Group,
group subsidiaries are present in consumer finance, capital, insurance, leisure
19

and entertainment, brand development, retail real estate development, retail

media and logistics.
The groups retail formats bring in around 250 million customer footfalls every
year and provide a platform for over 30,000 small, medium and large
entrepreneurs in India to sell their products and services to these customers. The
group has a retail presence in 85 cities and 65 rural destinations and employs
over 35,000 people directly.
Led by its flagship enterprise, Pantaloon Retail, the group operates over 16
million square feet of retail space in 73 cities and towns and 65 rural locations
across India. Headquartered in Mumbai (Bombay), Pantaloon Retail employs
around 30,000 people and is listed on the Indian stock exchanges. The company
follows a multi-format retail strategy that captures almost the entire consumption
basket of Indian customers. In the lifestyle segment, the group operates
Pantaloons, a fashion retail chain and Central, a chain of seamless malls. In the
value segment, its marquee brand, Big Bazaar is a hypermarket format that
combines the look, touch and feel of Indian bazaars with the choice and
convenience of modern retail.
Future Group companies includes, Future Capital Holdings, Future Generali India
Indus League Clothing and Galaxy Entertainment that manages Sports Bar,
Brew Bar and Bowling Co. Future Capital Holdings, the groups financial arm,
focuses on asset management and consumer credit. It manages assets worth
over $1 billion that are being invested in developing retail real estate and
consumer-related brands and hotels.
The groups joint venture partners include Italian insurance major, Generali,
French retailer ETAM group, US-based stationary products retailer, Staples Inc
and UK-based Lee Cooper and India-based Talwalkars, Blue Foods and Liberty
Shoes.Future Groups vision is to, deliver Everything, Everywhere, Every time to
Every Indian Consumer in the most profitable manner. The group considers

20

Indian-ness as a core value and its corporate credo is- Rewrite rules, Retain
values.
The groups specialty retail formats include supermarket chain - Food Bazaar,
sportswear retailer - Planet Sports, electronics retailer e-Zone, home
improvement chain -Home Town and rural retail chain - Aadhaar, among others
Future Group believes in developing strong insights on Indian consumers and
building businesses based on Indian ideas, as espoused in the groups core
value of Indian-ness. The groups corporate credo is, Rewrite rules, Retain
values.
FutureBazaar.com is the e-commerce arm of the Future Group. FutureBazaar
provides an integrated shopping site where consumers are able to buy products
from our flagship stores including e-Zone, Pantaloons and Big Bazaar online and
get home delivery of products.
FutureBazaar delivers across more than 1500 cities and towns in India covering
16,000

pin

codes. FutureBazaar carries

genuine

products and

offers

manufacturer's warranty (as opposed to Seller's warranty) which most other sites
offer. FutureBazaar offers products where the complete supply chain is managed
by Future Group entities unlike other sites that are marketplaces.
By the virtue of being a part of Future Group, FutureBazaar is able to offer a wide
range of genuine products at very competitive prices, confidence of buying from
a trusted source and the convenience of returning in our physical stores.
Future Group believes in developing strong insights on Indian consumers and
building businesses based on Indian ideas, as espoused in the groups core
value of Indian-ness. The groups corporate credo is, Rewrite rules, Retain
values.

21

Pantaloon Retail is the flagship company of Future Group, a business group

catering to the entire Indian consumption space.Pantaloons is among India's
largest chains of fashion stores. Pantaloons Fresh Fashion, with its focus on
'fresh look, feel and attitude' offers, trendy and hip collections that are in sync
with the hopes and aspirations of discerning young and 'young-at-heart'
consumers.Pantaloons Retail was recently awarded the International Retailer of
the Year 2007 by the US-based National Retail Federation (NRF) and the
Emerging Market Retailer of the Year 2007 at the World Retail Congress held in
Barcelona.
Over the years, the company has accelerated growth through its ability to lead
change. A number of its pioneering concepts have now emerged as industry
standards. For instance, the company integrated backwards into garment
manufacturing even as it expanded its retail presence at the front end, well
before any other Indian retail company attempted this. It was the first to introduce
the concept of the retail departmental store for the entire family through
Pantaloons in 1997. The company was the first to launch a hypermarket in India
with Big Bazaar, a large discount store that it commissioned in Kolkata in
October 2001. And the company introduced the country to the Food Bazaar, a
unique 'bazaar' within a hypermarket, which was launched in July 2002 in
22

Mumbai. Embracing our leadership value, the company launched aLL in July
2005 in Mumbai, making us the first retailer in India to open a fashion store for
plus size men and women.
Today it is the fastest growing retail company in India. The number of stores is
going to increase many folds year on year along with the new formats coming up.
The way they work is distinctly "Pantaloon". The courage to dream and to turn
our dreams into reality that change peoples lives, is their biggest advantage.
Pantaloon is an invitation to join a place where there are no boundaries to what
one can achieve. It means never having to stop asking questions; it means never
having to stop raising the bar. It is an opportunity to take risks, and it is this
passion that makes our dreams a reality.
Pantaloons Fresh Fashion stands out as a fashion trendsetter, on the lines of
how fashion is followed internationally. This 'fresh fashion' destination allows
customers to shop for the latest in fashion apparel and accessories throughout
the year in an attractive and visually stimulating ambience.
Pantaloons Fresh Fashion stores have presence with stores not just in Metros
but also in smaller towns. All stores have a wide variety of categories like casual
wear, ethnic wear, formalwear, party wear and sportswear for Men, Women and
Kids.
Pantaloon Retail (India) Limited, is Indias leading retailer that operates multiple
retail formats in both the value and lifestyle segment of the Indian consumer
market. Headquartered in Mumbai (Bombay), the company operates over 16
million square feet of retail space, has over 1000 stores across 73 cities in India
and employs over 30,000 people.
The companys leading formats include Pantaloons, a chain of fashion outlets,
Big Bazaar, a uniquely Indian hypermarket chain, Food Bazaar, a supermarket
chain, blends the look, touch and feel of Indian bazaars with aspects of modern
retail like choice, convenience and quality and Central, a chain of seamless
23

destination malls. Some of its other formats include Brand Factory, Blue Sky,
aLL, Top 10 and Star and Sitara.
Future Value Retail Limited is a wholly owned subsidiary of Pantaloon Retail
(India) Limited. This entity has been created keeping in mind the growth and the
current size of the companys value retail business, led by its format
divisions, Big Bazaar and Food Bazaar.
The company operates 148 Big Bazaar stores, 169 Food Bazaar stores, among
other formats, in over 70 citiesacross the country, covering an operational retail
space of over 6 million square feet. As a focussed entity driving the growth of the
group's value retail business, Future Value Retail Limited will continue to deliver
more value to its customers, supply partners, stakeholders and communities
across the country and shape the growth of modern retail in India.

A subsidiary company, Home Solutions Retail (India) Limited, operates Home

Town, a large-format home solutions store, Collection and selling home furniture
products and e-Zone focused on catering to the consumer electronics segment.

Milestones
1987* Company incorporated as Manz Wear Private Limited. Launch of
Pantaloons trouser, Indias first formal trouser brand.
1992* Initial public offer (IPO) was made in the month of May.
1997* Pantaloons Indias family store launched in Kolkata.
2001* Big Bazaar, Is se sastaauracchakahinahin - Indias first hypermarket
chain launched.
2002* Food Bazaar, the supermarket chain is launched.
2007* Future Group crosses $1 billion turnover mark.
24

Culture at Pantaloon
At Pantaloon, Empowerment is what you acquire and Freedom at Work is what
we get. They believe their people as most valuable assets. Young in spirit,
adventurous in action, with an average age of 27 years, their skilled & qualified
professionals

work

in

an

environment

where

change

is

the

only

constant.Powered by the desire to create path-breaking practices and held

together by values, work in this people intensive industry is driven b y softer issues.
Making a difference to Customers lives is a Passion for them and performance is

the key that makes it possible. Out of the Box thinking has become a way of life
at Pantaloon and living with the change, a habit.Leadership is a value that is
followed by one and all at Pantaloon. Leadership is the quality that motivates them
to never stop learning, stretching to reach the next challenge. In the quest of
creating an Indian model of retailing, Pantaloon has taken initiatives to launch
many retail formats that have come headed for serve as a benchmark in the
industry. Believing in leadership has given them the optimism to change and be
successful at it. According to them, they do not predict the future, but create it.

At Pantaloon one can get an opportunity to handle multiple responsibilities, and

therein, the grooming to play a larger role in the future. Work is a unique mix of
preserving our core Indian values and yet providing customers with a service, on
par with international standards.

Discovering talent diversity

The company strongly believes that its sustainable competitive advantage lies in
the values that it cherishes the culture that it imbibes and spirit of enterprise that
resides within the organization. Talent management therefore continues to be the
core focus for the company. Considering the multiple businesses and rapid
expansion expected across the business, the company saw merit in taking a
fresh guard to the way in which business would run in order to meet the next leg
of expansions.
25

During the year 2006-07, the company conducted an extensive review of inhouse talent management, which involved mapping every managerial position in
the organization for their skill sets, competence and attitudinal aspects as well as
taking an inventory check of the existing talent base and addressing their
development needs. Development Centers were created with in-house
assessors, which further aided in identifying potential resources and helped chalk
out post assessment development plans.
Continuing with its policy of strategic alliances, the company is collaborating on
joint degree programs with 15 management schools, design institutes and
institutes of higher learning in areas like food business, supply chain
management, design experience management etc. This Seekho program for
external and internal candidates has ensured a steady stream of mid-level, well
trained retail professionals every year.
The companys Gurukool program provides the front-end employees an
opportunity to imbibe the companys values and a sense of ownership to the
company. The company has also created an Employee Growth Trust Fund that
was launched during the last financial year for the senior management.

Equal Opportunity
The company believes that in order to build a sustainable business environment,
the composition of its talent base needs to reflect the diversity that exists in our
country and among its customers. Therefore the company ensures that the
proportional representation of different communities in the Indian population is
mirrored in its employee profile. The majority of employees in the company come
from socially and economically marginalized sections of the society. Close to
46% of the employees in the organization are women and the average age within
the organization is 27 years. The effectiveness of its talent management
initiatives is reflected in the fact that the annual rate of attrition is 8.12%, much
below industry levels. The company plans to strengthen its employee platform to
about 30,000 people by FY 08, from nearly 18,000 people as on FY 07.
26

Human Resource Initiatives

Pantaloon Retail believes that one of its sustainable competitive advantages will
continue to be the people who are part of the organization. Being in service
industry, the Company places a lot of focus is placed on attracting, and training,
incentivizing and retaining talent. The vision is "To provide an environment that
creates happy people who have a meaningful life and add value to business and
society." With over 18000 employees at an average age of 27 years, the
Company prides itself on being a young and energetic organization, driven
through the 'The Pantaloon People Management System'. This is built on 5
pillars of people based growth, namely - Culture Building, Performance
Management through Balanced Scorecard, People Processes, Management
Processes and Leadership Brilliance. Training a competent Learning &
Development Team is responsible for training employees at all the levels across
the country, focusing on primary and secondary research into various aspects of
retail and assessment of training needs across Knowledge, Skills & Attitude
areas. The emphasis is on creating product and process knowledge through welldefined programs like Praarambh and Parikrama. For the critical front line staff,
the Company's unique outbound residential training program Gurukool focuses
on integrating the mind, body and soul and brings about measurable attitudinal
and behavioral changes.
The program has covered nearly 4,500 employees. The SMILE initiative for
training of new Store Manager's has been created and disseminated to over 100
store managers by this team.

New initiatives in retail

In the financial year 2006-07, the companys retail businesses discovered new
categories across formats, new sets of consumers and fresher and contemporary
merchandise. They have been able to offer more in the established businesses
and gain favorable acceptance with new concepts. In addition, concerted
expansion plans saw retail space increase to over 5.2 million square feet at the
27

end of 2006-07. This expansion mode was characterized by a twopronged

approach. By dominating the cities the company was already present in and by
bringing the benefits of modern retail to towns and cities like Mangalore,
Palakkad, Surat, Indore, Kanpur, Haldia, Agra, Coimbatore, Jaipur and Panipat.
The company has also undertaken significant private label initiatives in food, in
general merchandise and in the consumer durables and electronics categories.
Strategic alliances have also been forged with established domestic and
international brands.
However, the most significant development was the internal realignment the
company undertook within each of its retail businesses. To embark on a more
detailed approach towards value creation and increasing efficiency, the company
reviewed its business operations and adopted a more focused approach by
creating an integrated support unit or Line of Business.
Augmenting the retail front-end team, Line of Business (LoB) units have
beencreated in the three most critical businesses food, fashion and general
merchandise. Formed during the second half of 2006-07 these business units
focus on introducing optimum operational efficiencies. Thus, these units ensure
that back - end measures are appropriately taken care of and the right kind of
merchandise reaches the stores in the best possible time, at the right price.
These teams focus on product consolidation and suitability, margin improvement,
and vendor rationalization, thereby ensuring that the sourcing benefits are made
available to the front - end team.The companys efforts over the next couple of
years would entail a combination of expansion and process up gradation and
implementation.
The emphasis will be on the next discoveries to be made in the retail space that
will lead to expansion. At the same time, there will be an increased focus on
micro detailing aspects including process, product and operational efficiencies
thereby contributing positively to the companys bottom-line.

28

Bharti retail, a wholly owned subsidiary of Bharti Enterprises Pvt. Ltd. Opened its
first convenient retail store on 16th April 2008 in Ludhiana, western Punjab under
the joint venture with worlds largest retailer Wal Mart.
Bharti-Wal Mart joint venture planned to open their retail chain by the name Easy
Day across India. The store would sell products of daily usage, ranging from
personal care products, stationery, household articles, hosiery items, daily-need
groceries including staples, processed foods, bakery, dairy products, meat,
poultry and fresh produce.
Bharti Retail had also entered into a joint venture with US retailer Wal-Mart, for
wholesale cash and carry operations by the name Best Price, a segment where
India allows 100 percent foreign direct investment.The joint venture is expected
to open 10 to 15 wholesale cash and carry facilities and employ approximately
5,000 people over the next seven years.
Each store is about 2,500 to 4,500 sft in size and is projected as one stop shop
for day-to-day family requirements such as groceries, personal care and
household products. The company is planning to setup these stores on PAN
India basis and they refused to give any further details on the project. The first 3
stores are opened in Ludhiana, the hometown of Sunil Bharti Mittal.
In its first phase of operations, Bharti Retail has opened 59 Easy Day stores in
Punjab, Haryana, Rajasthan, Uttar Pradesh and New Delhi. In addition, it also
has launched three compact hyper stores called Easy Day Market in Punjab. The
company has deliberately focused on north India in its first phase of operations in
an effort to consolidate presence in one market, before expanding to another
region.
29

The Easy Day stores source fresh fruits and vegetables from Bharti-Walmart. In
an interesting HR innovation the stores plan to tap workforce from the likes of
cart vendors, housewives and retired personnel, by offering flexi-hour work
schedules. Such groups of persons will also be enrolled for structured training
modules at the Bharti Retail Academy
Product Range in Easy Day stores:
o Dairy Products
o Grains & Pulses
o Bakery products
o Food and Beverages
o Home & Personal Care
o Meat and Poultry Items
o Frozen - Vegetarian, Non-Vegetarian [Meat] and Chilled Non-Vegetarian
All the three stores are single floor stores with cash counter and bakery section
at the entrance. Each category of the product was marked separately. Products
were effectively displayed with price tags.
In Easy Day stores we found that Home & Personal Care [Toothpaste, Soap, etc]
and Food & Beverages [Pepsi, Fruit Juiceand Cereals] are sold at a discount
between 1-5% only.
Great Value Private Label Brand:
The company has introduced its own private label under the brand name Great
Value. Most items are in the grains and pulses categories. With increasing
number of retailers, discount is what most consumers look for.
Each store has 12-15 employees including a store manager without any gender
of age bias. The company has also established "Bharti Academy of Retail" in
association with Global Retail School of Chandigarh for imparting training for the
retail business.

30

The stores, known as 'Easy Day', would be a one-stop shop to cater to every
family's day-to-day needs, company officials said, adding that "it will bring
together a relevant and wide product range, good quality products and great-inexperience and service-all under one roof".
The store would sell personal care products, stationary, household articles,
hosiery items, daily-need groceries like staples, processed foods, bakery and
dairy products, meat and poultry, and fresh produce.
The company had earlier announced an investment of up to 2.5 billion dollars
(Rs.10, 000crore) by 2015 in retail operations including multi-format retail outlets
across all cities in India that have population of over one million.
Bharti Retail Pvt. Ltd. is planning to open approximately 125 Easy Day
supermarkets and 13 Easy Day Market hypermarts by the end of 2011. The
company is looking to establish its presence in every city in India in another five
years and will invest approximately $2.5 billion to add about 10 million square
feet of retail space in the country.
The equal joint venture between Bharti and Wal-Mart is planning to open
approximately 15 cash-and-carry stores as well as provide work for
approximately 7,000 people over the next three years.
The retail arm of Bharti Enterprises currently has 60 Easy Day stores across
Punjab, Rajasthan, Haryana, Delhi and Uttar Pradesh and six Easy Day Market
stores across Punjab, Rajasthan and Uttar Pradesh.
Additionally, the company has also entered into agreements to open stores
having between 50,000sqft and 100,000sqft in Rajasthan and Madhya Pradesh.

31

The company was founded by Sunil Bharti Mittal along with two siblings in 1976.
The company was not so famous in India by its own name; rather its brand
names like Airtel and Beetel (PSTN Phone Sets) are household names in India.
The company underwent a brand reformation process and changed its logo and
corporate Image.
Bharti Enterprises is a large Indian business conglomerate headquartered in New
Delhi, India, operating primarily across India and in some other countries like Sri
Lanka, Bangladesh, Jersey, Guernsey and Seychelles with expanding operations
across Africa in Burkina Faso, Chad, Congo Brazzaville, Democratic Republic of
Congo, Gabon, Ghana, Kenya, Madagascar, Malawi, Niger, Nigeria, Sierra
Leone, Tanzania, Uganda, and Zambia. It was established by Sunil Bharti Mittal.
Bharti Enterprises has businesses spanning across telecom, retail, financial
services, manufacturing and software.

Bharti Retail Ltd.

Bharti Retail Ltd. is a wholly owned subsidiary of Bharti Enterprises. Bharti
Retail operates a chain of multiple format stores. The companys neighborhood
format stores operate under the "Easyday" brand and the compact hypermarket
format under the Easyday market brand. Recently the company has become
more involved in the food economic sectors, with a joint partnership in the
agricultural company FieldFresh.
Bharti Retail Pvt, Ltd. operates retail stores. It offers food and grocery categories,
fresh fruits and vegetables, meat and poultry, dairy products, staples, FMCG and
processed foods, electronics and appliances, clothing and footwear, furniture and
furnishing, and other household articles. The company was incorporated in 2007
and is based in India. It has stores in Punjab, Rajasthan, Haryana, and Uttar
32

Pradesh, as well as in Delhi. Bharti Retail Pvt, Ltd. operates as a subsidiary of

Bharti Enterprises Limited.
Bharti Retail Pvt Ltd. announced that the company will soon enter western India
with its first hypermarket in Mumbai. The company has signed a 60,000 sqft store
in the Neptune Magnet mall of the city's Bhandup area and this is expected to
open in the first quarter of 2012.
After Mumbai, the company plans to open 20 more stores in cities such as
Mumbai, Pune and Nanded. The company is also planning to set up a mother
distribution center on the Mumbai-Pune highway.
The company also planned to open stores in the south and signed half a dozen
stores in the region.
Bharti Enterprises tied-up with Wal-Mart for opening a chain of retail stores all
over India. Though the retail chain store venture is yet to see the light, the two
companies, in August 2007, made a surprise statement that they have signed a
wholesale cash-and-carry deal. The companies would open 10 - 15 cash-andcarry facilities over 7 years and would employ 5,000 people. Each store would
occupy 50,000-100,000 square feet.
The other retail companies of Bharti group are Bharti Retail (Holdings) Private
Limited, Bharti Retail Resources Private Limited and Cedar Support Services Ltd.
The format has been branded `Easy Day as first reported. The stores range
between 2,500 to 4,500 square feet. With the Easy Day stores, Bharti now joins
the ranks of other Indian conglomerates like Reliance Retail and Aditya Birla
Group, which have launched chains of their retail stores across the country.
Wal-Mart Inc has tied up with Bharti Enterprises for entering the Indian market.
Wal-Mart has entered into a technical agreement with Bharti for its retail stores,
where it provides assistance and technical know-how to Bharti on how to operate
and manage retail stores. Mike Duke, vice-chairman, Wal-Mart Inc, had already...
hinted that the retail store would not sport the Wal-Mart tag. He said that nearly
33

three fourths of Wal-Mart internationals retail operations are under 52 different

local brands, since the company wants to be seen as a local retailer in any area
operates rather than a retail behemoth.
Their strategy is to consolidate presence in one market, before expanding to
another geographic region. They planned to have 125 easy day and 13 Easyday
Market storesby the end of 2011. The focus of roll out would be North India but
they have plans to expand operations into other parts of India. The company has
lined up an investment of $2 billion to $2.5 billion by 2015 to fuel its expansion
plans.
Retail is viewed as the next big business by Bharti and continues to receive
investment and strategic attention. They are looking at approximately 10million
square feet of retail experience across all cities in India, with a population of over
one million.
The easy day Market in Jaipur is a 35,000 sq. ft. store offering over 18,000
quality products , including trendy fashion wear such as George (international
brand) and Astitva (Indian Ethnic Wear), private label products, home ware and
furnishings, a range of electronics and electrical appliances, mobile phones,
footwear, toys, books, food etc.
Though the company plans to first cover northern India and then proceed to other
parts, whether or not the Easy Day stores will be opened in UP is still doubtful.
These stores will retail an assortment of products like personal care, stationery,
household articles, hosiery items, daily-need groceries including staples,
processed foods, bakery and dairy products, meat and poultry and fresh
produce.
The first cash-and-carry store that will be operated by the 50:50 joint venture
accompany between Wal-Mart and Bharti will be operational by the year end.
Bharti-Wal-Mart is expected to open 10-15 cash-and-carry stores in seven years.

34

Wal-Mart

Stores,

Inc. (branded

as Wal-Mart)

is

an

American public

corporation that runs a chain of large, discount department stores. It is the

world's largest public corporation by revenue, according to the 2008 Fortune
Global 500.
The company was founded by, Sam Walton, who opened the first Wal-Mart
discount store in Rogers Arkansas back in 1962, and 47 years later, Wal-Mart
operates 8,159 units in 15 countries.
Incorporated on October 31, 1969, and listed on the New York Stock
Exchange in 1972, Wal-Mart is the largest private employer which employs over
2.1 million people worldwide.
Wal-Mart operates in Mexico as Walmex, in the United Kingdom as Asda, in
Japan as Seiyu, and in India as Best Price.
Wal-Mart is currently the worlds largest retailer with a total annual sale of
405,607 million (2009). Even in the midst of a recession its estimated that WalMart stores retail market share has risenmarkedly and they were seeing sales
gains for 2009.
As Wal Mart emerged as the worlds largest retailer in a short span of time, critics
are worried about its impact on local communities, particularly on mom and pop
shops for their survival. There have been several studies on the economic
impact of Wal-Mart on small towns and local businesses, jobs, and taxpayers.

35

Products of wal mart:

Discount stores:

Sam Walton opened his first Wal-Mart discount store in 1962. Today,
there are 810 stores offering a pleasant and convenient shopping
experience across the United States. The size of an average store is
107,000 square feet. Each store employs about 225 associates.

Stores feature wide, clean, brightly-lit aisles and shelves stocked with a
variety of quality, value-priced general merchandise, including family
apparel ,Automotive products, Health and beauty aids, Home furnishings,
Electronics, Hardware ,Toys, Sporting goods, Lawn and garden items, Pet
supplies, Jewelry, House wares.

Supercenters:

Supercenters were developed in 1988 to meet the growing demand for

convenient, one-stop family shopping featuring our famous Every Day Low
Prices. It saves time and money by combining a full grocery and our
general merchandise under one roof. There are 2,737 Supercenters
nationwide, and most are open 24 hours in US. Supercenters average
187,000 square feet and employ about 350 or more associates.

Supercenter groceries features include bakery goods, daily foods, meat

and dairy products, frozen foods, fresh produced, Canned and packaged
goods, dry goods and staples, condiments and spices beverages,
household supplies etc.

Neighborhood markets:

Neighborhood Markets offer a quick and convenient shopping experience

for customers who need groceries, pharmaceuticals, and general
merchandise all at our famous Every Day Low Prices. First opened in
1998, there are now 151 Neighborhood Markets, each employing about
36

95associates. A typical store is about 42,000 square feet. Neighborhood

Markets feature a wide variety of products like health and beauty aids, pet
supplies, stationery and paper goods, household supplies etc.
Supermercado de Wal-Mart:

Wal-Mart opened "Supermercado de Wal-Mart" locations to appeal to

Hispanic communities in the United States.

Sam's Club:

Sam's Club is a chain of warehouse clubs which sell grocery and general
merchandise in large quantities. Sam's Club stores are "membership"
stores and most customers buy annual memberships. However, nonmembers can make purchases either by buying a one-day membership or
paying a surcharge based on the price of the purchase.[51] Some locations
also sell gasoline.[46] The first Sam's Club opened in 1983 in Midwest City,
Oklahoma [51] under the name "Sam's Wholesale Club".

WalMart in India:
In November 2006, the company announced a joint venture with Bharti
Enterprises to open retail stores in India. As foreign corporations are not allowed
to directly enter the retail sector in India, Walmart will operate through franchises
and handle the wholesale end. The partnership will involve two joint ventures;
Bharti will manage the front end involving opening of retail outlets, while Walmart
will take care of the back end, such as cold chains and logistics.

37

-3REVIEW OF
LITERATURE

38

REVIEW OF LITERATURE
Retailing is the most dominant business in India. Various types of retail formats
have existed in our country. The quality of services provided by retailers can be
assessed by the pioneering work done by the experts in retail marketing.
One among the experts, Parasuraman et al, (1988), published one of the earliest
articles to measure the service quality of the retailers. In this study the service
quality of the retailers was scrutinized and the conclusion reached that, it will lead
to understand the service quality of retailers in our country.
Merrilees, Bill, et al, (March 2007), Retail Development and activity in transition
economies is the core theme. It focuses on retail marketing strategy. Retail
service quality, pricing and location, personal services to retain the customer are
the major focus of this publication.
Tam Jackie L .M, (September 2007), the study examines the relationships
among customer satisfaction, service quality and perceived value. This research
focuses on the examination of the variables simultaneously and their
relationships with post purchase behavior.
Soyoung Kim, et al., (2001), This article gives a structural view regarding the
ability of Retail Service Quality Scale to influence the retail shoppers perceptions
of service quality in discount stores in the U.S. and South Korea.
Sirohi, Niren, et al, (Summer 1998), focus on store loyalty intentions of current
customers of a food and grocery retailer to understand the effectiveness of
activities designed to retain customers. It also examines the quality perception,
variables associated with the value for money and competitor attractiveness.
The work of Boshoff, Christo, et al, (December 97) is a replication study which
gives an overview about SERVQUAL, the quality of customer service in the area
of retail in South Africa.

39

Fullerton, Gordon, et al., (June 2005), examine the extent to which affective and
continuous commitment serve as mediators of brand satisfaction and loyalty
intentions relationship.
The study of Terblanche, N.S, et al, (December 2004) focuses on the In-store
Shopping Experience (ISE) that offers retailers an alternative means of
differentiation. It is achievable by providing superior store shopping experience.
Subhash Mehta C., et al, (2000) explore the usefulness of SERVPERF, the
perceptions component of SERVQUAL in measuring the service quality of
electronic goods retailers.
SubashiniKaul, (October 2005) examines the (RSQS) retail service quality scale
developed in U.S. for applicability in Indian retailing. The data was collected from
adult shoppers from large formats apparel stores in the city of Bangalore for
tracking the overall service quality levels over a period of time.
Nor Khalidah Abu, (2004) in his paper produces the service quality dimensions
on various sized grocery retailers in Malaysia. This research is based on the
RSQS. It takes into account the retail setting.
Mehmet Arda, (September 2006) highlights the significance of world food
retailing and the significant impact of supermarkets and grocery procedures.
M.Dhurup in his paper presents the results of a study done on super markets.
The paper focuses on the measurement of customer perceptions of super market
service quality by using a national super market in South Africa.
Quality basically maintains equilibrium between the internal and external
environment of an education institution. A system that fulfils the requirement of
the external forces such as customers and at the same time applies to the
internal forces to accommodate them is the true winner (Koslowski, 2006;
Abdullah, 2006; Eagle and Brennan, 2007; Russell, 2005; Hill, 1995; Houston,
2008). Thus fulfilling the requirement of the customer in a creative manner is
quality (Voon, 2006; Samat, et al., 2006; Awan, et al., 2008; Azmi, et al., 2008).
40

The most recent development on the quality is in the service sector. When it
comes to providing service the customer plays the major role (Reeves and
Bednar, 1994; Eagle and Brennan, 2007; Awan, et al., 2008; Rowley, 1997).
Koslowski (2006) has narrowed down the types of quality and applied them
specifically to the higher education industry.
According to researcher the types of quality refer to some part of the system. As
stated by Koslowski (2006, p.282-283) the Transcendent quality is achieved
through specialized programs offered to the faculty in institution, Manufacturing
based quality is when the structure of degree is perfectly aligned to the
requirement of the customer, Product based quality is focused on the addition of
courses in a specialized degree, Value based quality is achieved by providing
the appropriate outcome to the customer and User based quality is gained by
fulfilling the requirements of the customer.
Service based industries are leading many nations. Service is basically the
creation of value for the buyer that attracts the buyer to try it and it cannot be
commented until tested (Guo, 2002; Awan, et al., 2008; Ham, et al., 2003; Wang,
et al., 2008). Thus to maintain standard in this era of global competition the
leaders are adopting Services Quality management strategies (Abdullah, 2005;
Samat, et al., 2006; Guo, 2002; La and Kandampully, 2004; Farrell, 2008;
Sakthivel and Raju, 2006; Wang, et al., 2008). There are many types of services
that are concerned with the fulfilment of needs of the customer. According to Guo
(2002, p.1157) the three main forms of Service provided are People Processing
Service (health care), Possession Processing Service (perfume) and InformationBased Services (banking). Maintaining Service Quality has been considered as
an edge for many organizations.
Therefore Service Quality has been used as an aggressive strategy to overcome
the external pressure (Slater and Narver, 1994; La and Kandampully, 2004;
Azmi, et al., 2008; Legcevic and Strossmayer, 2008).
The main purpose for this review of literature is to configure the importance of
maintaining Service quality in Higher Education industry. The paper would
explore the development of the concept of Service Quality. It would also explain
41

the developmentof Service Quality Measurement Models with respect to the

literature as well astheir application in various industries and especially the
higher education industry.
Thus the review paper provides a clear insight on the development of Service
QualityMeasurement Models. Although a lot of research has been done on the
ServiceQuality; yet the struggle to rightly unfold the concept is still under
progress.

Thispaper

talks

about

the

development

of

Service

Quality

Measurement Models, the entireprocess from the reason to development of the

concept and findings have beendiscussed. It is a chronological study, starting
from year 1988 to 2008 focusing on theresearch done on development and
improvements of service quality measurementmodels have been explored. From
1988 to 2008, eight Service Quality MeasurementModels have been developed.
In 1988, the first service quality measurement modelwas developed by
Parasuraman, et al. It was introduced by the name of ServiceQuality
(SERVQUAL). This model was empirically tested on the validity of ServiceQuality
Measurement

Variable

with

respect

to

the

multi-industries.

EventuallyParasuraman, et al. (1988, p.23) developed five dimensions which

were showingsignificance to the measurement of service quality, namely:
(a) Tangibles (physicalfacilities and equipment),
(b) Reliability (performing the promised service),
(c)Responsiveness (willingness to help customers),
(d) Assurance (courtesy ofemployees to convey trust) and
(e) Empathy (individualized attention provided tocustomers).
SERVQUAL has been highly recognized in the literature and since 1988 till now it
has been used by various researchers in a variety of industries. Then in 1992,
Cronin and Taylor developed another version of Service Quality Measurement
Model on Service Performance (SERVPERF). The main emphasis of the Cronin
and Taylor was on the performance based evaluation of the company. The core
elements were customer satisfaction and their purchase intentions. This
measurement model has also been highly acceptable by the researchers and
also applied to manyindustries.
42

In 1993, Teas developed two models for measuring service quality. Teas was not
convinced with the entire concept of measuring the customer perceived quality
with the gap of perception and expectation as in SERVQUAL. The major
emphasis of the researcher was on the conceptual understanding of Expectation,
since the expectation associated to the services could exceed the actual level of
performance of the company. Therefore the researcher developed Evaluated
Performance model (EP) in order to measures the gap between perceived
performance and ideal amount of a performance to gain consumer satisfaction.
Further catering to the expectation, the researcher concentrated on the prospect
created after the experience of the consumer. Teas (1993) perceived Excellence
norm as a result of positive experience of the customer, this led to the creation of
Normed Quality model. NQ measures the Quality gap between excellence norm
and ideal amount of expectations of the consumer. Both the measurement
models are applicable to various industries.
However the EP and NQ measurement model were not applied by other
researchers in the literature.
In 2006, Voon created Service Market Orientation measurement model
(SERVMO). Voon believed thatfulfilling the need of the students is the main
reason of the existence of an institution.
After the review of literature on development of Service Quality Measurement
Models from 1988 to 2008, the comparison of measurement models have been
done on the basis of acceptance and usage in the literature. Since the
development of SERVQUAL and SERVPERF in 1988 and 1992, these
measurement models have been extensively used by many researcher in their
relevant industry, thus the comparison of SERVQUAL with SERVPERF has been
done in order to check which model is better than the other. Considering the
developed Performance Based Measurement Models two of the models have
been created on the basis of Performance, thus for that reason SERVPERF and
SERVQUAL have been compared.
Since SERVPERF is already accepted by many researchers, thus the main
purposeis to configure the suitability of both the models and also the
43

development of a modified version of HEdPERF model has been shown.

SERVQUAL has been a widely accepted method for Measuring Service Quality
in various industries. From 1988 to 2008 it has still been used by many
researchers to measure the service quality in their industry of interest. However
in 2008, SERVCESS was created by selecting one dimension of the SERVQUAL
i.e. Tangible (Physical facilities and equipment). The role of equipment in
measuring service quality refers to the changes made in the up gradation of the
equipment (computers, projectors, multimedia), which has not been emphasized
in the SERVQUAL. Thus by comparing SERVQUAL and SERVCESS the
effectiveness of the SERVQUAL model is checked with respect to the importance
of Information system.
Considering the trend in development of Service Quality Measurement Models, it
has come into consideration that since 1996 to 2008 the researchers have
developed Service Quality Measurement Models.
Quality basically maintains equilibrium between the internal and external
environment of an institution. Thus researchers have been trying to create an
instrument that fits the requirement of the education industry.
A.Parsurama, Leonard L.Berry, and valarie A. Zeithmal,(1988) in their study
described about development of 22 item instrument in the assessment of the
service quality perception of the customers in the service and retail firms, which
was called as SERVQUAL. According to them service quality include
competence, courtesy, credibility, security, tangibles, reliability, responsiveness,
communication, and understanding the customer. Authors also proposed that
SERVQUAL scale can help a vast range of services and retail firms to assess
the customer expectation and perception of services quality as it had a variety of
potential application.
In their study the service quality of the retailers was scrutinized and the
conclusion reached that, it will lead to understand the service quality of retailers
in our country. Empirical results examining relationships from the model
concerning customers' behavioral intentions show strong evidence of their being
influenced by service quality. One interesting proposition they make is that "The
44

quality that a consumer perceives in a service is a function of the magnitude and

direction of the gap between expected service and perceived service".
Parasuraman have defined service quality as the ability of the organization to
meet or exceed customer expectations. It is the difference between customer
expectations of service and perceived service.
Service Quality was operationally concluded by Brady and Cronin (2001) when
they find through qualitative and empirical research that the service quality
construct conforms to the structure of a third-order factor model that ties service
quality perceptions to distinct and actionable dimensions: outcome, interaction,
and environmental quality. Each dimension has three sub-dimensions that define
the basis of service quality perceptions. For each of these sub-dimensions to
contribute to improved service quality perceptions, the quality received by
consumers must be perceived to be reliable, responsive, and empathetic.
Li, Tan and Xie (2003) suggest that a company's ability to achieve excellent
service quality depends on the choice of service attributes, their desired levels,
and the prioritization of service attributes. They investigate the asymmetric and
nonlinear nature of the relationship between service quality gaps and overall
service quality (quality that is worse than expected hurts more than quality that is
better than expected helps), and develop a model that applies utility theory to the
prioritization of service attributes.
In 1993, Teas developed two models for measuring service quality. Teas was not
convinced with the entire concept of measuring the customer perceived quality
with the gap of perception and expectation as in SERVQUAL. The major
emphasis of the researcher was on the conceptual understanding of Expectation,
since the expectation associated to the services could exceed the actual level of
performance of the company. Therefore the researcher developed Evaluated
Performance model (EP) in order to measures the gap between perceived
performance and ideal amount of a performance to gain consumer satisfaction.
Further catering to the expectation, the researcher concentrated on the prospect
created after the experience of the consumer. Teas (1993) perceived Excellence
norm as a result of positive experience of the customer, this led to the creation of
45

Normed Quality model. NQ measures the Quality gap between excellence norm
and ideal amount of expectations of the consumer. Both the measurement
models are applicable to various industries.
However the EP and NQ measurement model were not applied by other
researchers in the literature. Lo &Hui, (2003) presented a paper that deliberately
conceptualizes service quality Factors (such as reliability and responsiveness) as
being antecedents to customers overall evaluation of service quality, rather than
conceptualizing them as dimensions or components of the construct. Sparks and
Westgate (2002) suggest that service failure can have devastating effects on an
organization because customers frequently switch to a different provider when
they experience a service failure.
However, among customers who experience service problems, those who
receive satisfactory resolution are more likely to remain loyal to the service
provider. According to Spreng and Mackoy (1996), there is no clear definition of
satisfaction, although most definitions would involve an evaluative, affective or
emotional response. The distinction between perceived service quality and
satisfaction is important because managers need to know whether their objective
is to provide the maximum level of perceived service quality or to have satisfied
customers. The standard of comparison in forming satisfaction is predictive
expectations, or what the consumer believes will happen. Perceived service
quality is the result of a comparison of performance and what the consumer feels
a firm should provide.
Oliver (1993) claims that a customer can experience both negative and positive
affective reactions. Le and Sherwyn (1998) found that customers tipped
significantly more when touched than when not touched and that the duration of
the touch (two seconds versus four seconds) had no effect on tipping. According
to Guo (2002, p.1157) the three main forms of Service provided are People
Processing Service (health care), Possession Processing Service (perfume) and
Information-Based Services (banking).
Maintaining Service Quality has been considered as an edge for many
organizations.Therefore Service Quality has been used as an aggressive
46

strategy to overcome the external pressure (Slater and Narver, 1994; La and
Kandampully, 2004; Azmi, et al., 2008; Legcevic and Strossmayer, 2008).
Cronic and Taylor (1992), however,argue that the conceptualization of services
as a gap between expectation and performance is inadequate. They point out the
confusion in pertaining literature over the relationship between services quality
and the consumer satisfaction is defined as a gap between expectation and the
performance.
By Gronroos (1984), the customer perception of the services processes are
divided into two dimension technical quality and functional quality. BANKSERV
instrument proposed by Avkiran (1999) should be modified by adding tangibles
dimension because it is now considered as an important dimension in every
country all over the world to measure service quality in all sectors and thus this
instrument will be an appropriate battery to measure the service quality in the
banking sector. As a result, the author proposes five dimensions in the
BANKSERV instrument, which are listed in and are used in this study to measure
service quality in the banking sector because some problems are identified with
SERVQUAL to measure service quality. The main problem with SERVQUAL is to
compare perceived performance with expectations in separate items (22expectations items and 22-perceptions items), whereas the BANKSERV
instrument captures the similar comparison of perceived performance with
expectations in a battery of single statements (Avkiran, 1999).
A review of the relevant literature reveals the existence of various approaches to
conceptualize e-services. Rust and Lemon (2001, p. 86) very generally describe
e-services as providing a superior experience to consumers with respect to the
interactive flow of information. This broad understanding may serve as a basis
for a further, more detailed investigation. Grnroos et al. (2000) provide a more
differentiated definition in proposing the so-called NetOffer model, according to
which online services can be divided into a functional dimension (what is
delivered in terms of service outcome) and a technical dimension (how is it
delivered in term of service process). Yet, to fully capture all dimensions of an
electronic service the functional/technical approach has to be expanded by taking
47

into account an additional dimension comprising all aspects that take place
before the actual delivery of the service. Barnes and Vidgen (2001) draw upon
the SERVQUAL model in order to generate a pool of quality items. Based on an
analysis in the field of online book trade, the authors extract five key dimensions
each of which encompasses two sub-dimensions: tangibles (aesthetics,
navigation), reliability (reliability, competence), responsiveness (responsiveness,
access),

assurance

(credibility,

security)

and

empathy

(communication,

understanding the individual).

Overall, the developed WebQual scale focuses on technical quality aspects like
ease of use and is therefore more useful for the field of interface design than for
holistic quality measurement. We argue that not considering hedonic aspects of
online shopping (e.g. fun or enjoyment) is amajor omission. Van Riel et al. (2001)
propose a classification of service components which is based on the
technical/functional quality framework by Grnroos et al. (2000) and comprises
the following aspects: core services, facilitating services, supporting services,
complementary services, and user interface. In doing so, they attempt to assess
the quality of Grnroos (1984) offered a two-dimensional model comprised of
technical quality and functional quality (pp. 29-38). Lehtinen and Lehtinen (1983)
set forth a two- dimensional approach to service quality consisting of process
quality and outcome quality. Lehtinen and Lehtinen (1991) also introduced a
three dimensional approach comprised of physical quality, interactive quality, and
corporate quality (pp. 288-290).
Parasuraman, Zeithaml and Berrys (1988a) SERVQUAL model consisted of five
dimensions, which includes tangibles, reliability, responsiveness, assurance and
empathy (pp. 12-40). Rust and Oliver (1994) introduced a three-dimensional
model of service quality encompassing the service product, service delivery and
service environment measuring customer satisfaction.
Atilgan et al. (2003) suggest that cultural characteristics have an effect on
perceptions of service quality. They found that different cultural groups can have
different levels of expectations and perceptions in terms of service-quality
dimensions (p 420). Therefore, many of the items on the SERVQUAL instrument
48

can be salient to different customers for different reasons. Brown and Bond III
(1995) attribute the importance of these items as to whether or not the customer
is conscious of aspects such as time, quality of work, finances, and so forth (p.
30).
Caruana (2000) claims that service quality and satisfaction have often been used
interchangeably. Distinctions between customer satisfaction and service quality
include:
a) Satisfaction is a post- experience decision customer experience while quality
is not;
b) In the satisfaction literature expectations reflect anticipated performance
made by customers about levels of performance during a transaction. In the
service quality literature, expectations are conceptualized as a normative stand
of future wants.
After the review of literature on development of Service Quality Measurement
Models from 1988 to 2008, the comparison of measurement models have been
done on the basis of acceptance and usage in the literature. Since the
development of SERVQUAL and SERVPERF in 1988 and 1992, these
measurement models have been extensively used by many researcher in their
relevant industry, thus the comparison of SERVQUAL with SERVPERF has been
done in order to check which model is better than the other. Considering the
developed Performance Based Measurement Models two of the models have
been created on the basis of Performance.
SERVPERF is already accepted by many researchers, thus the main purpose is
to configure the suitability of the models and also the development of a modified
version of these models has to be shown. SERVQUAL has been a widely
accepted method for Measuring Service Quality in various industries. From 1988
to 2008 it has still been used by many researchers to measure the service quality
in their industry of interest.
However in 2008, SERVCESS was created by selecting onedimension of the
SERVQUAL i.e. Tangible (Physical facilities and equipment). Therole of
equipment in measuring service quality refers to the changes made in the up
49

gradation of the equipment (computers, projectors, multimedia), which has not

been emphasized in the SERVQUAL. Thus by comparing SERVQUAL and
SERVCESS the effectiveness of the SERVQUAL model is checked with respect
to the importance of Information system.
Considering the trend in development of Service Quality Measurement Models, it
has come into consideration that since 1996 to 2008 the researchers have
developed Service Quality Measurement Models specifically for the retail
industry, thus quality management in retail Industry plays a fundamental role.
Quality basically maintains equilibrium between the internal and external
environment of an organization.
Thus researchers have been trying to create an instrument that fits the
requirement of the retail industry. In the paper I have highlighted the main
variables considered important by the researchers for the retail industry and then
further discussed them with respect to their importance in the retail Industry. The
main variable considered in developing theService Quality Measurement Models
especially for retail Industry areTotal Quality Management (TQM), Performance
of the institution in Service Performance Model (SERVPERF), Market Orientation
in Service driven Market Orientation Model (SERVMO) and Information System
in Service Quality and Information System Success Model (SERVCESS).
Thus this review paper covers the relevance of Service Quality, with respect to
the development of the measurement models as well as its relevance in the
Higher Education Industry. A visual representation has been given on the next
page as figure 1 with respect to the sequence of the review paper. According to
Spreng and Mackoy (1996), there is no clear definition of satisfaction, although
most definitions would involve an evaluative, affective or emotional response.
The distinction between perceived service quality and satisfaction is important
because managers need to know whether their objective is to provide the
maximum level of perceived service quality or to have satisfied customers.
The standard of comparison in forming satisfaction is predictive expectations, or
what the consumer believes will happen. Perceived service quality is the result of

50

a comparison of performance and what the consumer feels a firm should provide
(pp. 201-214).
Burns et al. (2003) describe negative disconfirmation as an occurring when
performance is less than expectations. Positive disconfirmation is evident when
performance is greater than expectations (pp. 363-380). Customer satisfaction
results in the disconfirmation of prior expectation that is if the service provider
meets or exceeds expectations then the customer is more likely to be satisfied
(Rust et al., 1995). Milln& Esteban (2004) claim that satisfaction is perceived as
the final result of all activities carried out during the process of purchase and
consumption. All reviewed definitions imply:
a) The existence of an objective that the consumer wishes to reach;
b) The attainment (satisfaction) of this objective can only be judged by taking a
standard of comparison as a reference; and
c) The evaluation process of satisfaction implies the intervention of at least two
stimuli; a result and a reference or standard of comparison. Satisfaction is related
to size and direction of non-confirmatory: experience defined by the difference
between initial expectations of the individual and the actual result derived.
Expectations are the needs or desires of the consumer, based on what the
consumer feels should be delivered before receiving it. Perceptions are the
beliefs of the consumer relative to the service received.
The consumers opinion of satisfaction or dissatisfaction depends on how the
consumer perceives the actual result obtained relative to what was expected (pp.
533-546). Much of the attention given to service quality is motivated by the
premise that it will increase customer satisfaction and ultimately lead to better
financial performance (Babikas et al., 2004).
The quality of products and services has also been linked to external indicators
of customer satisfaction such as complaints, warranty, litigation and market share (Ahire& Dreyfus, 2000). Satisfied customers often lead to loyal customers
who continuously repurchase the product or service. Depending upon the
industry, Fornell (1992) contends that not all companies are equally affected by
customer satisfaction.
51

However, all organizations are dependent upon repeat purchases that lead to
higher profitability (Empirical evidence suggests that customer satisfaction
mediates the relationship between service quality and firm performance.
Uelschy, Laroch, Tamilia and Yannopoulos (2004) claimed that measures of
service quality and satisfaction can be non-equivalent across different cultures. In
other words, a measure that works well in the United States may not perform
properly overseas. Across cultures, the translation, interpretation and meaning of
particular terms can introduce response bias. Thus, due to cultural differences,
one cannot assume that a citizen of one country will perceive quality in the same
way as one from a different country. Because beliefs are a part of culture, two
individuals can experience identical consumption and register differing levels of
satisfaction based on differing schematic reference points they bring to a
situation.
Casey (2001), for example, argues that tippinghas important consequences for
the relationships among managers, front-line service workers, and customers,
and for relations among co-workers. She also suggests that tipping may
influence employee commitment, teamwork, and motivation, and claims that
while tipping allows low labor costs, it may undermine the relationship between
managers and staff because the customer becomes the one who provides
monetary compensation and feedback to the servers.
Brady and Cronin (2001) find through qualitative and empirical research that the
service quality construct conforms to the structure of a third-order factor model
that ties service quality perceptions to distinct and actionable dimensions:
outcome, interaction, and environmental quality. Each dimension has three subdimensions that define the basis of service quality perceptions. For each of these
sub-dimensions to contribute to improved service quality perceptions, the quality
received by consumers must be perceived to be reliable, responsive, and
empathetic.
Li, Tan and Xie (2003) suggest that a company's ability to achieve excellent
service quality depends on the choice of service attributes, their desired levels,
and the prioritization of service attributes. They investigate the asymmetric and
52

nonlinear nature of the relationship between service quality gaps and overall
service quality (quality that is worse than expected hurts more than quality that is
better than expected helps), and develop a model that applies utility theory to the
prioritization of service attributes.
Surprenant and Solomon (1987) stated that service encounters are human
interactions. They suggested that customers and service providers have roles to
play during and possibly after service encounters and that these roles are based
on interpersonal interactions between organizations and customers. Service
quality in all service encounters is thus intrinsically affected by the perspectives
of both the service provider and the service receiver.
Similarly, Czepiel (1990) concluded that research on service quality must always
include the perspectives of both the provider and the receiver. However, most
research on the service quality construct has been restricted to one perspective:
that of the service receiver (Parasuraman et al., 1988; Guerrier and Deery,
1998). A few have applied dual perspectives and considered interactive features
of service quality in service encounters.
Tam and Wong, 2001; Chow-Chua and Komaran, 2002; Dedeke, 2003;
Svensson, 2004, 2006). Beatson et al. (2008) found that perceived employee
satisfaction, perceived employee loyalty, and perceived employee commitment
had a sizable impact on perceived product quality and on perceived service
quality.
According to Bettencourt and Gwinner (1996) FLE has the opportunity to tailor in
real-time not only the services the firm offers, but also the way in which those
services are delivered. Customer actions, reactions and other characteristics can
have a profound influence on the actions and mannerisms of front-line service
personnel (Solomon et al., 1985; Matzler et al., 2004).
Customers largely establish their impressions of the organizations level of
service provision based on their encounters with FLE. Therefore employees
involved in the delivery of front-line services can provide valuable information for
improving service. FLE are knowledgeable about the strengths and weaknesses
of the service through their contact with customers and this is an important form
53

of feedback that can be used by organizations in decision-making to better serve

customers. Research has established a positive correlation between the attitudes
of employees and those of customers, including employee and customer
perceptions of service quality (Schneider and Bowen, 1985).
Brysland and Curry (2001) stated that the literature clearly supported the use of
SERVQUAL in the public sector. According to Gowan et al. (2001), service
provision is more complex in the public sector because it is not simply a matter of
meeting expressed needs, but of finding out unexpressed needs, setting
priorities, allocating resources and publicly justifying and accounting for what has
been done. In addition, Caron and Giauque (2006) pointed out that public sector
employees are currently confronted with new professional challenges arising
from the introduction of new principles and tools inspired by the shift to new
public management.
Anderson (1995) also measured the quality of service provided by a public
university health clinic. Using 15 statements representing the five-dimensions of
SERVQUAL (Parasuraman et al., 1988), she assessed the quality of service
provided by the clinic at the University of Houston Health Center. Patients were
found to be generally dissatisfied with the five dimensions of SERVQUAL. The
highest dissatisfaction was felt with assurance. On the other hand, tangibles and
A empathy exhibited the lowest level of dissatisfaction.
Using the SERVQUAL approach, Wisniewski (2001) carried out a study to
assess customer satisfaction within the public sector across a range of Scottish
Councils services. Agus et al. (2007) carried out a research to identify
management and customer perceptions of service quality practices in the
Malaysian Public sector. It is important to note that whereas the SERVQUAL
model focused on identifying gaps between expectations and actual delivery,
their model focused only on perceptions of actual service delivery.
Bitner et al. (1994) and Schneider and Bowen (1985) where both employees and
customers have common perceptions regarding the level of service quality
delivered in an organization. This study was therefore able to highlight how
important it is for an organization, be it a public sector organization, to conduct a
54

survey and consider the opinions of its customers and its employees in
identifying areas for service quality improvements. It is therefore very important
for them to know how customers evaluate service quality and what they can do to
measure and improve service quality. Therefore, to exceed customer
expectations, it is necessary for even a public sector organization to continually
improve the quality of service provided to its customers.
Lewis (1991) proposed that service quality is a measure of how well the service
delivered meets customers' expectations of a product and service.

Service

quality received a significant amount of attention by both researchers and

practitioners. It has been defined as a form of an attitude related but not exactly
satisfaction that results from the comparison of expected service levels with
perceived performance (Bolton & Drew, 1992; Parasurman et al., 1988; Cronin &
Taylor, 1992). Our article is structured as follows. Firstly, we will differentiate
conceptually between retailer attributes (particularly with regard to service by a
retailer) and customer-based retail brand equity. Moreover, based on a brief
review of the literature, we will offer an outline of the main constructs.
Subsequently, we will focus on the relationship between the perception of retailer
attributes and retail brand equity by formulating a set of hypotheses. Thirdly, we
will discuss the results of an intersectoral empirical study that was undertaken
using multiple-group structural equation modelling to test our research
hypotheses.
In conclusion, we will address the research as well as the managerial
implications of our findings on the relationship between service quality and
customer-based retail brand equity compared with the other retailer attributes. .
They can perform these functions well, to the organizations advantage, or
poorly, to the organizations detriment. According to Bettencourt and Gwinner
(1996) FLE has the opportunity to tailorin real-time not only the services the firm
offers, but also the way in which those services are delivered.
Customer actions, reactions and other characteristics can have a profound
influence on the actions and mannerisms of front-line service personnel
(Solomon et al., 1985; Matzler et al., 2004). Customers largely establish their
55

impressions of the organizations level of service provision based on their

encounters with FLE. Therefore employees involved in the delivery of front-line
services can provide valuable information for improving service. FLE are
knowledgeable about the strengths and weaknesses of the service through their
contact with customers and this is an important form of feedback that can be
used by organizations in decision-making to better serve customers. Research
has established a positive correlation between the attitudes of employees and
those of customers, including employee and customer perceptions of service
quality (Schneider and Bowen, 1985)
In other words, customers enter a consumption .experience expecting a certain
level of service and during this consumption period they experience actual
service performance. The consumers subjective evaluation of how well (or
poorly) that actual performance compares to expected performance results in the
perceived service quality (Woodruff et al., 1983; Parasurman et al., 1988; Cronin
& Taylor, 1992). There is considerable evidence that service quality functions as
an antecedent to customer satisfaction (Reidenbach&Sandifer- Smallwood,
1990; Cronin & Taylor, 1992; Reichheld&Sasser, 1990). Traditionally, service
quality has been defined as the difference between customer expectations of
service to be received and perceptions of the service actually received. Service
quality received a significant amount of attention by both researchers and
practitioners. It has been defined as a form of an attitude related but not exactly
satisfaction that results from the comparison of expected service levels with
perceived performance.
In other words, customers enter a consumption experience expecting a certain
level of service and during this consumption period they experience actual
service performance. The consumers subjective evaluation of how well (or
poorly) that actual performance compares to expected performance results in the
perceived service quality. There is considerable evidence that service quality
functions as an antecedent to customer satisfaction. Service based industries are
leading many nations. Service is basically the creation of value for the buyer that
attracts the buyer to try it and it cannot be commented until tested (Guo, 2002;
56

Awan, et al., 2008; Ham, et al., 2003; Wang, et al., 2008). Thus to maintain
standard in this era of global competition the leaders are adopting Services
Quality management strategies (Abdullah, 2005; Samat, et al., 2006; Guo, 2002;
La and Kandampully, 2004; Farrell, 2008; Sakthivel and Raju, 2006; Wang, et al.,
2008). There are many types of services that are concerned with the fulfilment of
needs of the customer.
According to Guo (2002, p.1157) the three main forms of Service provided are
People Processing Service (health care), Possession Processing Service
(perfume) and Information-Based Services (banking).Maintaining Service Quality
has been considered as an edge for many organizations. Therefore Service
Quality has been used as an aggressive strategy to overcome the external
pressure (Slater and Narver, 1994; La and Kandampully, 2004; Azmi, et al.,
2008; Legcevic and Strossmayer, 2008). Merrilees, Bill, et al, (March 2007),
Retail Development and activity in transition economies is the core theme. The
objective of the publication is to come with the Estonian situation in Republic of
Estonia. It focuses on retail marketing strategy. Retail service quality, pricing and
location, personal services to retain the customer are the major focus of this
publication. Tam J ackie L .M. , (September 2007). The study examines the
relationships among customer satisfaction, service quality and perceived value.
This research focuses on the examination of the variables simultaneously and
their relationships with post purchase behavior; Soyoung Kim, et al., (2001).
This article gives a structural view regarding the ability of Retail Service Quality
Scale to influence the retail shoppers perceptions of service quality in discount
stores in the U.S and South Korea. Sirohi, Niren, et al., (Summer 1998), focus on
store loyalty intentions of current customers of a food and grocery retailer to
understand the effectiveness of activities designed to retain customers. It also
examines the quality perception, variables associated with the value for money
and competitor attractiveness.
The work of Boshoff, Christo, et al., (December 97) is a replication study which
gives an overview about SERVQUAL, the quality of customer service in the area
of retail in South Africa. This research indicates the five basic dimensions and
57

models of DabholkarA. et al. (1996). The research of Gounaris, Spiros, et al,

(September 2005) investigatesthe antecedents of perceived service quality in
theinternet environment for trust in a retail store. It focuses on the reasons for
shopping online. The results indicate the perceived e-service quality comprised
of four keys dimensions. Ful l e r ton, Gordon, et al., (June 2005), examine the
extent to which affective and continuous commitment serve as mediators of
brand satisfaction and loyalty intentions relationship.
The study of Terblanche, N.S, et al, (December 2004) focuses on the in store
shopping experience (ISE) that offers retailers an alternative means of
differentiation. It is able to achieve by providing superior store shopping
experience. Diverse retailing environments (Super markets vs. apparel retailers)
by Trocchia, Philip. J. et al., (2003) evaluate the internet service quality through
SERVQUAL. Long, Mary et al, (2004) give a multidimensional measure on
online service quality, based on the consumers comments and their experiences
with online retailers. Subhash Mehta C., et al, (2000) explore the usefulness of
SERVPERF, the perceptions component of SERVQUAL in measuring the service
quality of electronic goods retailers.
SubashiniKaul, (October 2005) examines the (RSQS) retail service quality scale
developed in U.S. for applicability in Indian retailing. The data was collected from
adult shoppers from large formats apparel stores in the city of Bangalore for
tracking the overall service quality levels over a period of time. Nor Khalidah Abu,
(2004) in his paper produces the service quality dimensions on various sized
grocery retailers in Malaysia. This research is based on the RSQS developed by
Dabhokar A. et al, (1996). It takes into account the retail setting. Mehmet Arda,
(September 2006) highlights the significance of world food retailing and the
significant impact of supermarkets and grocery procedures.
M.Dhurup in this paper presents the results of a study done on super markets.
The paper focuses on the measurement of customer perceptions of super market
service quality by using a national super market in South Africa.
The opposite view, that social norms increase efficiency, is articulated well by
Arrow (1971, p. 22), who wrote, I want, however, to conclude by calling attention
58

to a less visible form of social action: norms of social behavior, including ethical
and moral codes. I suggest as one possible interpretation that they are reactions
of society to compensate for market failures. Two paragraphs below Arrow
added, There is a whole set of customs and norms which might be similarly
interpreted as agreements to improve the efficiency of the economic system (in
the broad sense of satisfaction of individual values) by providing commodities to
which the price system is inapplicable.
Several studies tried to examine whether tipping is a norm that increases
socialwelfare. Conlin, Lynn, and O'Donoghue (2003), for example, study tipping
behavior inrestaurants, and conclude that it exhibits elements of efficiency, but is
not fully efficient. Azar (2005a) addresses the question whether tipping was
created to increase social welfare by examining the difference in the
characteristics of various tipped and non-tipped occupations. Azar (2005b)
addresses a similar question with a theoretical model that analyzes in what
conditions tipping is likely to increase social welfare.
Surprenant and Solomon (1987) stated that service encounters are human
interactions. They suggested that customers and service providers have roles to
play during and possibly after service encounters and that these roles are based
on interpersonal interactions between organizations and customers. Service
quality in all service encounters is thus intrinsically affected by the perspectives
of both the service provider and the service receiver. Similarly, Czepiel (1990)
concluded that research on service quality must always include the perspectives
of both the provider and the receiver.
However, most research on the service quality construct has been restricted to
one perspective: that of the service receiver (Parasuraman et al., 1988; Guerrier
and Deery, 1998). A few have applied dual perspectives and considered
interactive features of service quality in service encounters (Tam and Wong,
2001; Chow-Chua and Komaran, 2002; Dedeke, 2003; Svensson, Beatson et al.
(2008) found that perceived employee satisfaction, perceived employee loyalty,
and perceived employee commitment had a sizable impact on perceived product
quality and on perceived service quality. According to Zeithaml and Bitner (1996),
59

contact employees represent the organization and can directly influence

customer

satisfaction,

they

perform

the

role

of

marketers.

Whether

acknowledged or not, service employees perform marketing functions. They can

perform these functions well, to the organizations advantage, or poorly, to the
organizations detriment.
According to Bettencourt and Gwinner (1996) FLE has the opportunity to tailor in
real-time not only the services the firm offers, but also the way in which those
services are delivered. Customer actions, reactions and other characteristics can
have a profound influence on the actions and mannerisms of front-line service
personnel (Solomon et al., 1985; Matzler et al., 2004).Customers largely
establish their impressions of the organizations level of service provision based
on their encounters with FLE. Therefore employees involved in the delivery of
front-line services can provide valuable information for improving service. FLE
are knowledgeable about the strengths and weaknesses of the service through
their contact with customers and this is an important form of feedback that can be
used by organizations in decision-making to better serve customers.
Research has established a positive correlation between the attitudes of
employees and those of customers, including employee and customer
perceptions of service quality (Schneider and Bowen, 1985).2004, 2006). Lo
&Hui, (2003) presented a paper that deliberately conceptualizes service quality
factors (such as reliability and responsiveness) as being antecedents to
customers overall evaluation of service quality, rather than conceptualizing them
as dimensions or components of the construct The results of store image studies
and the findings of perception research (seeSchiffman and Kanuk, 2004; Mowen
and Minor, 2001; Solomon, 2006 for a moredetailed discussion on this topic),
also on the basis of research by Hildebrandt (1988),and by Mazursky and Jacoby
(1986), lead us to believe that a consumer judges a retaileron the basis of certain
basic dimensions of perception.
At the same time, however, it is important to note that consumers tend to simplify
when deciding, with the effect that they are unable to judge individual,
objectively different properties of an object truly independently of one another,
60

resulting in the consumer tending rather to base his judgement on key

information, for example, as well as in the occurrence of irradiation effects. We
assume that the individual properties correlate with one another. Marks (1976)
pointed out that the individual attributes could not be regarded in isolation
because they do interact with one another in the mind of the consumer. Since the
study by Osman M. Zain& Ismail Rejab (1989) there has been a large influx of
large scale multinational retailers (RosmimahMohd. Roslin, 2000).
The number of hypermarkets increases tremendously from only 1 in 1995 to 21
in 2002 (Prystay, 2002) and to 30 in 2003 (Moreira, 2003). The growing number
of the larger grocery retailers has been a concern of the Ministry of Domestic
Trade and Consumer Affairs (MDTCA) who felt that hypermarkets are affecting
local retailers as they operate on low margins in a slow growing grocery market.
The slow growth of grocery products in Malaysia happened since the Asian
crisis. In 2001, the growth of grocery products is only 3% (Euromonitor, 2002). In
addition, hypermarkets like Tesco, Carrefour, and Giant are creating price war as
they continuously cut down prices on daily use essentials including grocery
products (Moreira, 2003).
In an effort claimed by MDTCA to protect small retailers, Guidelines for the
Establishment of Hypermarkets were issued (Moreira, 2003). The retail industry
has witnessed the high rate (38%) of traditional provision stores closure from
46,544 in 1992 to 28,659 in 2001 (Prystay, 2002). Another observable result is
the closure of 16 Tops supermarkets in 2000 and another 6 at the end of 2002
(Ganesan, 2003a). Furthermore, the sales revenue of Ocean supermarkets in
Klang Valley in 2002 reduces by 38% from the previous year due to competition
from hypermarkets (Moreira, 2003). Ghobadian et al. (1994) posit that most of
the service quality definitions fall within the customer led category. Juran (1999)
elaborates the definition of customer led quality as features of products which
meet customers needs and thereby provide customer satisfaction. As service
quality relates to meeting customers needs, we will be looking at perceived
service quality in order to understand consumers (Arnauld et al., 2002).
Grnroos (1984) and Parasuraman et al., (1985) looks at perceived quality of
61

service as the difference between customers expectation and their perceptions

of the actual service received. Other researchers look at perceived service
quality as an attitude. Arnauld et al., (2002) defined perceived quality whether in
reference to a product or service as the consumers evaluative judgment about
an entitys overall excellence or superiority in providing desired benefits (p. 327).
Hoffman & Bateson (2001) defines service quality as an attitude formed by a
long-term, overall evaluation of a performance. Attitude is defined as a
consumers overall, enduring evaluation of a concept or object, such as a person,
a brand, or a service. (Arnauld et al, 2002) Service quality as an attitude is
consistent with the views of Parasuraman et al., (1988), Cronin & Taylor (1992) &
Sureshchandar et al., (2002). Basis of the view is elaborated by the latter: As
perceived service quality portrays a general, overall appraisal of service i.e. a
global value judgment on the superiority of the overall service, it is viewed as
similar to attitude. (p. 364).
However, Imrie et al. (2002) found that researches utilizing Western samples did
not discover the factors sincerity, generosity, and courtesy/politeness which
he found to be critical to Taiwanese consumers. The interpretation of politeness
by Imrie (2002) is similar to the interpretation of formality by Winsted (1999).
She found that formality is a critical service quality factor to Japanese
customers.
Odekerken-Schrder et al. (2001) in their research emphasized the importance
of inter-personal relationship which refers to the opportunity for customers to
affiliate with other individuals during the retail encounter (Odekerken-Schrder et
al., 2001, p. 310). They elaborated the interaction as both the customer-tocustomer and customer-to-service provider social interaction. Previously, Harris
et al. (1995) proved in their study that 48% customers of a retail store interacted
orally with the service personnel while nearly 12% of the customers interact orally
with other customers.
Feinburg& de Ruyter (1995) in their cross culture study of service quality
conceptions of retail consumers in United States, Netherlands, and Taiwan found
that although there are similarities of how consumers in one country define
62

service quality, there are significant differences discovered in the importance

placed on each dimension. The similarities discovered were the inclusion of
friendly and knowledgeable salespeople in the definition of all groups. They also
found that Taiwanese rate highly on the dimensions of polite/friendly sales
people and respectful treatment received in the store, Americans rate highly on
merchandise related dimensions, while Dutch consumers rate highly on
personalized service and knowledgeable sales people.
Quality basically maintains equilibrium between the internal and external
environment of an education institution. A system that fulfils the requirement of
the external forces such as customers and at the same time applies to the
internal forces to accommodate them is the true winner (Koslowski, 2006;
Abdullah, 2006; Eagle and Brennan, 2007; Russell, 2005; Hill, 1995; Houston,
2008). Thus fulfilling the requirement of the customer in a creative manner is
quality (Voon, 2006; Samat, et al., 2006; Awan, et al., 2008; Azmi, et al., 2008).
The most recent development on the quality is in the service sector. When it
comes to providing service the customer plays the major role (Reeves and
Bednar, 1994; Eagle and Brennan, 2007; Awan, et al., 2008; Rowley, 1997).
Koslowski (2006) has narrowed down the types of quality and applied them
specifically to the higher education industry. According to researcher the types of
quality refer to some part of the system. As stated by Koslowski (2006, p.282283) the Transcendent quality is achieved through specialized programs offered
to the faculty in institution, Manufacturing based quality is when the structure of
degree is perfectly aligned to the requirement of the customer, Product based
quality is focused on the addition of courses in a specialized degree, Value
based quality is achieved by providing the appropriate outcome to the customer
and User based quality is gained by fulfilling the requirements of the
customer.Service based industries are leading many nations.
Service is basically the creation of value for the buyer that attracts the buyer to
try it and it cannot be commented until tested (Guo, 2002; Awan, et al., 2008;
Ham, et al., 2003; Wang, et al., 2008). Thus to maintain standard in this era of
global competition the leaders are adopting Services Quality management
63

strategies (Abdullah, 2005; Samat, et al., 2006; Guo, 2002; La and Kandampully,
2004; Farrell, 2008; Sakthivel and Raju, 2006; Wang, et al., 2008).
There are many types of services that are concerned with the fulfilment of needs
of the customer. According to Guo (2002, p.1157) the three main forms of
Service provided are People Processing Service (health care), Possession
Processing Service (perfume) and Information-Based Services (banking).
Maintaining Service Quality has been considered as an edge for many
organizations. Therefore Service Quality has been used as an aggressive
strategy to overcome the external pressure (Slater and Narver, 1994; La and
Kandampully, 2004; Azmi, et al., 2008; Legcevic and Strossmayer, 2008). In
1993, Teas developed two models for measuring service quality.
Teas was not convinced with the entire concept of measuring the customer
perceived quality with the gap of perception and expectation as in SERVQUAL.
The major emphasis of the researcher was on the conceptual understanding of
Expectation, since the expectation associated to the services could exceed the
actual level of performance of the company. Therefore the researcher developed
Evaluated Performance model (EP) in order to measures the gap between
perceived performance and ideal amount of a performance to gain consumer
satisfaction. Further catering to the expectation, the researcher concentrated on
the prospect created after the experience of the consumer. Teas (1993)
perceived Excellence norm as a result of positive experience of the customer,
this led to the creation of Normed Quality model. NQ measures the Quality gap
between excellence norm and ideal amount of expectations of the consumer.
Both the measurement models are applicable to various industries. However the
EP and NQ measurement model were not applied by other researchers in the
literature. Services unlike tangible products are produced and consumed at the
same time in the presence of the customer and the service producer. The
presence of the human element during the service delivery process greatly
increases the probability of error on the part of employees and customers. This
error is due to intangible behavioral processes that cannot be easily monitored or
controlled (Bowen, 1986). However, although a substantial amount of service
64

quality research has focused on service customers perceived service quality

(Parasuraman et al., 1988; Carman, 1990; Parasuraman et al., 1991; Babakus
and Boller, 1992; Cronin and Taylor, 1992; Babakus and Mangold, 1992),
relatively little attention has been paid to exploring the factors that impact on
service employees behavior with regard to delivering service quality.
Little is known about service quality perceptions in India (Jain and Gupta, 2004)
because research focus has primarily been on developed countries (Herbig and
Genestre, 1996). Given the relatively mature markets where the service quality
scales have been developed, it seems unlikely that these measures would be
applicable to India without adaptation. Angur, Nataraajan and Jahera (1999)
examined the SERVQUAL in the retail banking industry and reported a poor fit of
the scale to the empirical data.
Despite this, several researchers (Sharma and Mehta, 2004; Bhat, 2005) have
used the SERVQUAL scale in similar settings with no assessment of the
psychometric soundness of the scale. Service quality in retailing is different from
any other product/service environment (Finn and Lamb, 1991; Gagliano and
Hathcote, 1994). For this reason, Dabholkar, Thorpe and Rentz (1996)
developed the Retail Service Quality Scale (RSQS) for measuring retail service
quality. The RSQS has a five dimensional structure of which three dimensions
comprise of two subdimensions each. Studies assessing the applicability of the
RSQS have reported encouraging results.
Dabholkar, Thorpe and Rentz (1996) replicated their own study and found all the
RSQS dimensions and sub-dimensions to be valid in the U.S. Mehta, Lalwani
and Han (2000) found the RSQS five dimensional structure appropriate for
measuring the service quality perceptions of supermarket consumers in
Singapore. Kim and Jin (2001) report the RSQS a useful scale for measuring
service quality of discount stores across two different cultural contexts of U.S.
and South Korea, though they reported empirical support for a four and not a five
dimensional structure.
Boshoff and Terblanche (1997), in a replication of the Dabholkar, Thorpe and
Rentz (1996) study, report highly encouraging results for the RSQS applicability
65

in the context of department stores, specialty stores and hypermarkets in South

Africa. Since the study by Osman M. Zain& Ismail Rejab (1989) there has been a
large influx of large scale multinational retailers (RosmimahMohd. Roslin, 2000).
The number of hypermarkets increases tremendously from only 1 in 1995 to 21
in 2002 (Prystay, 2002) and to 30 in 2003 (Moreira, 2003). The growing number
of the larger grocery retailers has been a concern of the Ministry of Domestic
Trade and Consumer Affairs (MDTCA) who felt that hypermarkets are affecting
local retailers as they operate on low margins in a slow growing grocery market.
The slow growth of grocery products in Malaysia happened since the Asian
crisis. In 2001, the growth of grocery products is only 3% (Euromonitor, 2002). In
addition, hypermarkets like Tesco, Carrefour, and Giant are creating price war as
they continuously cut down prices on daily use essentials including grocery
products (Moreira, 2003).
Feinburg, and de Ruyter (1995) supported this idea as they postulate that the
dimensions are instruments for measuring perceived service quality. They also
posit that consumer-perceived service quality is usually seen as a multidimensional construct. The earliest research on service quality dimensions was
done by Grnroos (1984). He found that the perceived quality of a service is
affected by the experience that the consumer went through for a service.
Therefore, he encapsulated the perceived quality of a given service as the
outcome of an evaluation process; a comparison between the consumer
expectations of the service with his perceptions of the service he has received.
He also pointed that expectation is influence by traditions, ideology, word-ofmouth communication, and previous experience with the service and the
consumers perception of the service itself determines his perceived service.
However, he did not discuss the relationship between perception and expectation
and how it influences service quality.
Grnroos (1984) found that service quality comprises of three global
dimensions. The first dimension is the technical quality. This dimension refers to
the outcome or what is delivered or what the customer gets from the service. For
a retail store, technical quality may include the range of products offered and the
66

availability of parking space. The next dimension is the functional quality which
refers to the manner in which the service is delivered or how it is delivered.
Customers of a retail store will measure whether the salespeople are friendly or
whether products are easily returnable. Finally, the last dimension is the
corporate image. The stores image is built by mainly both technical and
functional quality and to some extent other factors like the traditional marketing
activities.
The most popular service quality model in the 1990s (Robinson, 1999) is the
model by Parasuraman et al., (1985). Their model supported Grnroos findings
on as the models are based on these three underlying themes: 1) Service
quality is more difficult for the consumer to evaluate than goods quality; 2)
Service quality perceptions result from a comparison of consumer expectations
with actual service performance; 3) Quality expectations are not made solely on
the outcome of the service; they also involve evaluations of the process of the
service (Parasuraman et al.,1985, p. 42) Unlike Grnroos (1984) who used
global measure of service quality, Parasuraman et al. (1985) identified 97 items
or criteria in measuring service quality. They argued that consumers used similar
criteria irrespective of the type of service in measuring service quality. They then
group these criteria into 10 key categories which they labeled as service quality
determinants (p. 48). The determinants are reliability, responsiveness,
competence,

access,

courtesy,

communication,

credibility,

security,

understanding/knowing the customer, and tangibles. Later in another research

(Parasuraman et al., 1988), they refined the dimensions as shown in Table 1 into
only five dimensions - tangibles, reliability, responsiveness, assurance, and
empathy. Little is known about service quality perceptions in India (Jain and
Gupta, 2004) because research focus has primarily been on developed countries
(Herbig and Genestre, 1996).
Given the relatively mature markets where the service quality scales have been
developed, it seems unlikely that these measures would be applicable to India
without adaptation. Angur, Nataraajan and Jahera (1999) examined the
SERVQUAL in the retail banking industry and reported a poor fit of the scale to
67

the empirical data. Despite this, several researchers (Sharma and Mehta, 2004;
Bhat, 2005) have used the SERVQUAL scale in similar settings with no
assessment of the psychometric soundness of the scale. Service quality in
retailing is different from any other product/service environment (Finn and Lamb,
1991; Gagliano and Hathcote, 1994). For this reason, Dabholkar,
Thorpe and Rentz (1996) developed the Retail Service Quality Scale (RSQS) for
measuring retail service quality. The RSQS has a five dimensional structure of
which three dimensions comprise of two subdimensions each. Studies assessing
the applicability of the RSQS have reported encouraging results. Dabholkar,
Thorpe and Rentz (1996) replicated their own study and found all the RSQS
dimensions and sub-dimensions to be valid in the U.S. Mehta, Lalwani and Han
(2000) found the RSQS five dimensional structure appropriate for measuring the
service quality perceptions of supermarket consumers in Singapore.
Kim and Jin (2001) report the RSQS a useful scale for measuring service quality
of discount stores across two different cultural contexts of U.S. and South Korea,
though they reported empirical support for a four and not a five dimensional
structure.
Boshoff and Terblanche (1997), in a replication of the Dabholkar, Thorpe and
Rent (1996) study, report highly encouraging results for the RSQS applicability in
the context of department stores, specialty stores and hypermarkets in South
Africa. This study evaluates the applicability of the RSQS scale developed by
Dabholkar, Thorpe and Rentz (1996) for measuring service quality in the Indian
specialty apparel store context. If the RSQS is found to be valid and reliable it will
be the first such instrument available to Indian retailers. If not, then researchers
and retailers alike would be forewarned about using an unreliable scale for
measuring retail service quality in India. Literature on customer satisfaction is
voluminous and spans several areas such as marketing, management and
accounting. For example, numerous papers use the ACSI (American Customer
Satisfaction Index) to study customer satisfaction at the company, industry and
macroeconomic levels. For the purposes of our paper, we focus only on
customer satisfaction studies that are immediately related to our work in retailing
68

and do not survey the literature that studies the design of satisfaction survey
instruments, because in this work we had no control over survey design. The
basic tenet of this research stream is that higher service quality improves
customer satisfaction, resulting in better financial performance, although the
mechanisms by which this improvement happens vary.
Iacobucci et al. (1994, 1995) provide precise definitions of service quality versus
customer satisfaction. They contend that service quality should not be confused
with customer satisfaction, but that satisfaction is a positive outcome of providing
good service.
Ittner and Larcker (1998) provide empirical evidence at the customer, businessunit and firm- level that various measures of financial performance (including
revenue, revenue change, margins, return on sales, market value of equity and
current earnings) are positively associated with customer satisfaction. However,
in the retail industry they find a negative relationship between satisfaction and
profitability which may be because benefits from increased satisfaction can be
exceeded by the incremental cost in retail.
Sulek et al. (1995) find that customer satisfaction positively affects sales per
labor hour at a chain of 46 retail stores. Anderson et al. (2004) find a positive
association between customer satisfaction at the company level and Tobins q (a
long-run measure of financial performance) for department stores and
supermarkets.
Babakus et al. (2004) link customer satisfaction to product and service quality
within retail stores and find that product quality has a 6 significant impact on
store-level profits. To summarize, research on customer satisfaction views
employees as facilitators of the sales process who are critical to improving the
conversion ratio, by providing information to the customers on prices, brands,
and product features and by helping customers to navigate store aisles, finding
the product and even cross-selling other products.
The unique feature of the retail store execution problem is that it combines the
factory and the sales components, but this stream of literature focuses only on
the latter. Perhaps the closest to retailing are the streams of literatures studying
69

customer satisfaction, operational failures and performance in the airline and

healthcare industry, because these industries too combine factory and sales
components of execution.
Studies of execution in the healthcare industry focused on operational failures in
the execution process (Tucker 2004) as well as on learning through these
failures (Tucker and Edmondson 2003). Ren and Wang (2006a) empirically link
process consistency and service quality while Ren and Wang (2006b) further
show how service quality affects volume at US hospitals.
Using data on customer complaints caused by operational failures in the airline
industry, Lapre and Tsikriktsis (2006) find that customer dissatisfaction follows a
U-shaped function of operating experience: first dissatisfaction decreases with
experience because airlines learn but then dissatisfaction increases because
customers increase their expectations of service.
Tsikriktsis (2006) shows that the relationship between operational performance
and profitability depends upon a companys operating model; focused airlines
show a link between late arrivals and profitability, whereas full service airlines do
not. Moreover, capacity utilization is a stronger driver of profitability for fullservice airlines than for focused airlines.
Anderson et al. (2006) find that drivers of customer satisfaction are affected by
customer attributions of blame for service failures: namely, customer-employee
interactions are less important when the customer attributes blame to the service
provider. Retailing is the most dominant business in India. Though, various types
of retail formats have existed in our country, food retailing plays a vital role. In
this current scenario the concentration of the researchers, academicians and
retail managers were diver ted and expanded into scrutinizing the food retailing
business. This is possible through the quality of services provided by the food
retailers to each and every individual in the society.
The quality of services provided by food retailers SCMS Journal of Indian
Management, July - September, 2008, 30A Quarterly Journal Published by
SCMS-COCHIN can be assessed by the pioneering work done by the experts in

70

retail marketing. The results indicate the perceived e-service quality comprised of
four keys dimensions.
Fullerton, Gordon, et al., (June 2005), examine the extent to which affective and
continuous commitment serve as mediators of brand satisfaction and loyalty
intentions relationship.
The study of Terblanche, N.S,et al, (December 2004) focuses on the in store
shopping experience (ISE) that offers retailers an alternative means of
differentiation. It is able to achieve by providing superior store shopping
experience. Diverse retailing environments (Super markets vs. apparel retailers)
by Trocchia, Philip. J. et al., (2003) evaluate the internet service quality through
SERVQUAL. Long, Mary et al, (2004) give a multidimensional measure on
online service quality, based on the consumers comments and their experiences
with online retailers.
Subhash Mehta C., et al, (2000) explore the usefulness of SERVPERF, the
perceptions component of SERVQUAL in measuring the service quality of
electronic goods retailers. SubashiniKaul, (October 2005) examines the (RSQS)
retail service quality scale developed in U.S. for applicability in Indian retailing.
The data was collected from adult shoppers from large formats apparel stores in
the city of Bangalore for tracking the overall service quality levels over a period of
time.
Nor Khalidah Abu, (2004) in his paper produces the service quality dimensions
on various sized grocery retailers in Malaysia. This research is based on the
RSQS developed by Dabhokar A. et al, (1996). It takes into account the retail
setting. In this article the authors applied the SERVQUAL instrument proposed
by Dabholkar A. et al, (1996) to evaluate the SCMS Journal of Indian
Management, July - September, 2008. 40 A Quarterly Journal Published by
SCMS-COCHIN retail service quality of food retailers and validation of the
instrument was also done for the food retailers located in Chennai City setup.
The evolution of service quality of retailers purely depends on the scrutinizationof
the five factors namely physical aspects, reliability, personal interaction, problem
solving and policy.
71

Little is known about service quality perceptions in India (Jain and Gupta, 2004)
because research focus has primarily been on developed countries (Herbig and
Genestre, 1996). Given the relatively mature markets where the service quality
scales have been developed, it seems unlikely that these measures would be
applicable to India without adaptation. Angur, Nataraajan and Jahera (1999)
examined the SERVQUAL in the retail banking industry and reported a poor fit of
the scale to the empirical data. Despite this, several researchers (Sharma and
Mehta, 2004; Bhat, 2005) have used the SERVQUAL scale in similar settings
with no assessment of the psychometric soundness of the scale.
Only a few academic studies have conducted a thorough investigation of the
retail marketing mix with the aim of comparing the specific attributes in terms of
their relevance in building a strong retail brand (Kent, 2003; Miranda et al., 2005).
Thus, we look at the findings of store image research without including a
discussion of the terminology because of the long history of changing
conceptualization (Hartman and Spiro, 2005, p. 1113)
Service quality in retailing is different from any other product/service environment
(Finn and Lamb, 1991; Gagliano and Hathcote, 1994). For this reason,
Dabholkar, Thorpe and Rentz (1996) developed the Retail Service Quality Scale
(RSQS) for measuring retail service quality. The RSQS has a five dimensional
structure of which three dimensions comprise of two subdimensions each.
Studies assessing the applicability of the RSQS have reported encouraging
results.
Dabholkar, Thorpe and Rentz (1996) replicated their own study and found all the
RSQS dimensions and sub-dimensions to be valid in the U.S. Mehta, Lalwani
and Han (2000) found the RSQS five dimensional structure appropriate for
measuring the service quality perceptions of supermarket consumers in
Singapore.
Kim and Jin (2001) report the RSQS a useful scale for measuring service quality
of discount stores across two different cultural contexts of U.S. and South Korea,
though they reported empirical support for a four and not a five dimensional
structure. Boshoff and Terblanche (1997), in a replication of the Dabholkar,
72

Thorpe and Rentz(1996) study, report highly encouraging results for the RSQS
applicability in the context of department stores, specialty stores and
hypermarkets in South Africa. This study evaluates the applicability of the RSQS
scale developed by Dabholkar, Thorpe and Rentz (1996) for measuring service
quality in the Indian specialty apparel store context. If the RSQS is found to be
valid and reliable it will be the first such instrument available to Indian retailers. If
not, then researchers and retailers alike would be forewarned about using an
unreliable scale for measuring retail service quality in India.
There are several findings suggesting that, from a retailers perspective,
serviceelements provided by appropriate and competent salespersons certainly
are a critical success factor (e.g. Babin et al., 1999). It was found that
perceptions of service quality during a service encounter influenced consumers
willingness to buy, more so than perceptions of product quality did (Sweeney et
al., 1997). Thus, employees competence and abilities are not the only important
factors (Wang and Netemeyer, 2004), but also the employees friendliness and
general presentation (Schneider and Bowen, 1999; Shao et al., 2004) play a
particularly central role.
Especially against a background of strongprice orientation by some retailers and
the increasing homogeneity of products and assortments, service quality is a
very promising means of creating a distinctive retailer brand, not only for
speciality retailers. Thus, regardless of price, a retailer should avoid poor service
levels for any service activity (Darian et al., 2005). In general, service is classified
in a number of different ways in retailing; however we tend to refer here to a very
clear and simple set of service activity categories.
Gagliano and Hathcote (1994) divide service in retailing into store service (e.g.
returns/exchanges, after sales service) and sales service (helpfulness,
friendliness, employees competence). This classification is comparable to that
used by Gronroos (1984). For the service industry in general, he divided service
quality into two categories: technical quality, primarily focused on what
consumers actually receive from the service department, and functional quality,
focusing on the process of rendering service.
73

Other studies, building on the work of Parasuraman et al. (1985, 1988), have
tried to develop a model of service quality specifically rooted in the retail sector
(Carman, 1990; Dabholkar et al., 1996; Mehta et al., 2000; Zhao et al., 2002).
This model was examined from a critical viewpoint (e.g. Carman, 1990; Cronin
and Taylor, 1992; Teas, 1993) and applied many times in very different sectors,
even hospitals, for example (Babakus and Mangold, 1989). This is a very
extensive model with widely defined dimensions: physical aspects, reliability,
personal interaction, problem solving, and policy.
Li Fei, Li Xiang, Mi Bu & Wang Gao (2011) have studied the positioning points of
Chinese supermarkets and concluded that they have unique positioning points
and can select any one of these positioning points in the form of product, price or
service.
Skallerud&Grnhaug

(2011)have

investigated

Chinese

food

supermarket

positioning strategies and found some importantfactors related to the nature of

the food supply and demand relationship which could be influenced by the
positioning strategies of supermarkets.
JayantAnand (2009) has evaluated the reason behind increasing number of
supermarkets in developing countries and revealed that both large and small
retailers can survive profitably by segregating their markets on the basis of
income groups and their grouping of products. Studies conducted by Ganguli,
Shirshendu and Kumar, V (2008) have found out the important parameters of
customer loyalty and satisfaction for the Indian retail supermarket customer.
Attempts have been made to understand the impact of those parameters on
loyalty and satisfaction of the consumer.
Suryadarma (2007) had found out in its survey the effect of supermarkets on
other traditional markets. The survey revealed that supermarkets are not the
major cause of decline amongtraditional market and it was found there is an
immediate need to improve the infrastructure and adopt better marketing
practices so as to ensure the survival of these traditional markets.
Nguyen, Barrett & D. Nguyen (2007) had explored the supermarket attributes
(SMA) and impact of hedonic shopping motivations (HSM) on shopper loyalty
74

(SLO). Results indicated that both these parameters had positive effects on
customer loyalty and supermarket managers should concentrate their positioning
strategies not only on the serviceable dimension but also on the Far East
Research Centre Hong Kong hedonic motivations especially for older and higher
income segments of customers to stimulate customer loyalty.
AC Nielsen (2007) undertook a survey in Jakarta and in suburban cities of
Bandung and Cirebon which concentrated on buying behavior of the customer in
supermarkets and in traditional markets. The survey revealed that penetration of
grocery vending has occurred much more rapidly in ready-made foods and in
household and personal care products, for which supermarkets achieve a cost
benefit that result from huge economies of scale due to centralized system of
supply and distribution. These benefits are passed on to consumers in the form
of savings thus pulling them towards the channel. Progress of supermarkets has
been relatively slow due to procurement challenges, price, buying behavior and
perceptions regarding the freshness of product. Again customers still prefer to
buy their food items mainly from local vegetable vendors that give them the
advantage of low prices and personalized services.
Thomas Reardon and Ashok Gulati (2002) has stated that the increase of
supermarkets and their implications in other developed countries has been
learning experience for India which has led to this major structural change in
retailing. India can definitely expand and flourish with these large retail stores but
should build its own model to suit the requirements of all each section society.
There should be proper integration and culmination of farmers, wholesalers and
retailers so as to make this change successful. Research conducted by Reardon
and Berdegu (2002) has found that the emergence of supermarkets is a kind of
innovation in developing countries. Their expansion is very rapid.
Supermarkets are leading players in most of the agrarian economy of Latin
America and the share of retailing in these countries have increased from having
moved from 10-20 percent in 1990 to 50-60 per cent in 2000. The contribution of
supermarkets in the retail food sector in these countries is quite of similar pattern
to those in developed countries.
75

Here thedimensions personal interaction, problem solving and policy are

comparable in terms of content with those of Gagliano and Hathcote (1994).
In principle, the physical aspects dimension is considered as store design, and
reliability is interpreted more as a dimension that is not dependent on customer
service.
Dabholkar et al. (1996) believe that their instrument is able to serve as a
diagnostic tool for retailers to determine which service areas need improvement.
As this detailed, intensive and isolated review of service quality is not the
purpose of the present study, the following refers more to the classifications used
by Gagliano and Hathcote, while we are aware that store design can also be
considered a service instrument in the broader sense, but which is identified as a
separate field.
Merrilees et al. show in their model that personal service has even more
influence on brand attitude and customer loyalty than price.
Furthermore, Siu and Chow (2003) show that, in addition to customer service in
its narrower sense, the store design (physical aspects of the store) is also a
salient element in determining customer satisfaction and future consumption
behavior.
In Malhotras (1983) threshold model of store choice, service quality is one of the
five salient characteristics identified, along with variety and selection, acceptable
prices, convenience of location, and physical facilities.
Rinne and Swinyard (1995) or Mazursky and Jacoby (1986) also illustrate in their
study that the importance of the store attributes differ.
As already demonstrated in the analysis of service, the literature also contains
analyses relating to the other retailer attributes that illustrate the importance of
individual attributes, usually considered in isolation and without making any
comparisons (e.g. price: Binkley and Bejnarowicz, 2003; assortment: Amine and
Cadenat, 2003; advertising: Rajiv et al., 2002; store design: Turley and Chebat,
2002). The issue here is how do retailer attributes differ in terms of their degree
of importance?

76

-4RESEARCH
METHODOLOGY

77

4.1. Title of the Study:

A comparative study of service quality of big bazaar and easy day

4.2. Duration of the Project:

It is a semester long project.

4.3. Objective of the Study:

For every problem, there is a research. As all the researches are organized
keeping some objective to be resolved, my project study is also based on some
objectives kept in mind during the process.
The primary objective of the study remains to compare the services provided by
Big Bazaar and Easy Day on the basis of societal norms as well as customer
perspective. The study will, in an overall perspective, aim to cover following
objectives:
1. To analyze the basic concepts behind the services of the retail chains with the
variations in applicability of standards in different services.
2. To find out a differences between services provided by Big Bazaar and Easy
Day.
3. To find out the opportunity of retailing and customer services in India at
different levels.
4. To know the past, present and future strategy and policy of Big Bazaar and
Easy Day.
5. To find out the new trend of retailing and services provided by them.
6. To know the contribution of technology that how it change the scenario of the
retailing services in India.
7. To find out the government role for retail sector in the country.
8. To analyze the awareness of the public towards the services provided by both
the retailers.
9. To find out the perception and first choice of the public while taking services
in different situations.

78

4.4. Type of research:

Research type

Exploratory Research

Data type

Primary and secondary data

Research tools

Questionnaire survey and interview

Sampling units

Customers

Duration

Semester long project

Data type: Primary and Secondary data

Primary data are those, which are collected afresh and for first time and thus
happen to be original in character.
The secondary are those which have been collected by someone else and which
have already been passed through statistical process.
In this project, data has been collected by Primary sources such as questionnaire
and personnel interview. It included 11 questions and 50 customers were given
the questionnaire and response was taken from them.
Charts and graphs will be used for presentation of data for easy understanding
and interpretation.

79

Research tools:
1. Questionnaire:
While designing the Questionnaires certain things were kept in mind such
as simplicity, length and clarity
2. Personal interview:
Personal interview is mostly commonly used method of data collection.
Two purposive communications between interviewer (researcher) and the
respondent (subject) aimed at obtaining and recording information
pertinent to the subject matter of study. The interviewer resents oral,
verbal and written stimuli and receives oral resonances.

4.5. Sample size and method of selecting sample:

Sample size

Sampling method :

50 respondents
Convenience sampling

Sometimes it is alsocalledas grab or opportunity sampling. It is a type of

nonprobability sampling which involves the sample being drawn from that part of
the population which is close to hand. That is, a sample population selected
because it is readily available and convenient.

4.6. Scope of the Study:

The retail stores of Big Bazaar across the Jaipur city and Easy Day were taken
into consideration to observe, evaluate and compare the service quality provided
by both the retailers.
The basic difference between the services provided by these two players would
be beneficial for the people who want to choose the services among these
retailers and the study will also provide specific idea to the governing bodies of
this sector how to compete and increase the service quality comparing to the
other retailer.

80

Big Bazaar has been selected because of the following reasons:

It the largest retail chain in India. (ICRIER Survey of Indian Retail Sector19 March 2011).
This large format store comprise of almost everything required by people
from different income groups.
There are all time discounts and promotional offers going on in the Big
Bazar on its saleable products.
Well regulated customer care tele-calling services.
Easy Day has been selected because of the following reasons:
It is the venture of two biggest players of their fields- Bharti Airtel and Wal
Mart.
Very fast and effective supply chain system is the matter to study about.
Modern and technically sound services are promised.
Wal Mart has provided most of the retail expertise - such as information
technology back-up, retail practices and training guidelines for Easy Day stores.

4.7. Limitations of the Study:

Findings are related to particular areas.
Small sample size has been taken (only 50).
Lack of time availability was also a constraint.
Lack of awareness towards the issue by most of the researchers.
Authenticity of secondary data also limits the accuracy of results.
The collection and availability of data acted as a limit to the study.
The study is focused only on Big Bazaar and Easy Day and covers limited
information about the topic.
The result and analysis based on the customer survey and questionnaire
method, thus biasness and manipulations could not be avoided.

81

-5FACTS AND FINDINGS

82

FACTS AND FINDING

Stores are performing well in attracting the customers.
Most of the people who visit to the stores are of age group between 20-45
yrs.
People usually visit the store once or twice a week in a week i.e. in
weekends.
They found different variety of product in food bazaar and house hold
utensils.
The main dis-satisfaction for the customer is in the billing section and at
parking space.
Discounts and offers are doing well in the stores.
Most of the customers who visit stores are having annual income between
Rs.3 - 4.5lac.
Inside the stores, employees interaction is very less with customers.
Location of retail shop is outstanding in Jaipur city.
Cleanliness and hygiene maintained in the store is not up to mark.
Retail shop provides value added service like home delivery, alteration,
helpline etc. but very few customers go for it.
Electronic and print media has high reach in consumer and plays a major
role in communication about promotional scheme and offers where as
word of mouth make significant impact in decision making than any other
means of communication.
Customers dont find brands they expect in Big Bazaar especially in
apparels section.
Customers are less aware of Easy day till now and Big Bazaar still
covering the maximum number of footfalls.
Over all we found that Big Bazaar is still the better place for shopping
rather than easy Day. It will take a lot of time to divert the customers
perception about Easy Day as a competitive retail store.

83

-6DATA ANALYSIS AND

INTERPRETATIONS

84

Q. What are the ages of respondents?

a) 25-30
b) 30-35
c) 40-50
d) Above 55

ANALYSIS:
From the survey it was found that amongst 50 respondents
a) 15% of the respondents are under 30 years old.
b) 35% of the respondents are between 30 and 35 years of age.
c) 35% of the respondents are between 40 and 50 years of age.
d) 15% of the respondents are more than 55 years of age.

Q. Occupation of the Respondents.

85

a) Service
b) Business
c) Student
d) Self Employed

ANALYSIS:
From the survey it was found that amongst 50 respondents
a) 40% of the respondents are servicemen.
b) 25% of the respondents are businessmen.
c) 20% of the respondents are students.
d) 15% of the respondents are self-employed.

Q. Income level of Respondents

86

a) 1.5 lacs
b) 1.5 3 lacs
c) 3 4.5 lacs
d) above 4.5 lacs

ANALYSIS:
From the survey it was found that amongst 50 respondents:
a) 6% of the respondents have an average annual income upto 1.5 lac.
b) 25% of the respondents have an average annual income from 1.5 lacs to 3
lacs
c) 65% of the respondents have an average annual income from 3 lacs to 4.5
lacs
d) 4% of the respondents have an average annual income above 5 lac.

87

Q.1. Have you visited both Big Bazaar and Easy Day?
A. yes- 70%
B. no- 30%

visits

30%
yes

70%

no

INTERPRETATION:
35 out of 50 respondents (70%) have visited both the big bazaar and easy day
retail stores. So it can be interpreted that most of them were able to compare the
same aspects in both the retail stores.

88

Q.2. which retail stores do you prefer for shopping?

A. Big Bazaar-

56%

B. Easy Day-

16%

C. other-

28%

shopping preference

big bazaar
easy day

others

INTERPRETATION:
28 out of 50 (56%) respondents prefer big bazaar for their shopping needs
while only 8 out of 50 (16%) were agree to go for easy day. Rest 14 (28%)
prefer to go for other retailers like reliance, shoppers stop, more etc.

89

Q.3.Is the store conveniently located?

Big Bazaar-

Easy Day-

A. yes

60%

20%

B. no

24%

64%

C. doesnt matter

16%

16%

100%

80%

yes

60%

no
doesn't matter

40%

20%

0%

big bazaar

easy day

INTERPRETATION:
60% respondents like the location of big bazaar in Jaipur city and 24% felt it inconvenient. While Easy day store location was disliked by 64% respondents yet
20% liked its location.

90

Q.4 which outlet is good in terms of degree of service?

Big Bazaar-

Easy Day-

A. very good

40%

20%

B. good

50%

50%

C. bad

10%

30%

120%

100%

80%

very good
60%

good
bad

40%

20%

0%

big bazaar

easy day

INTERPRETATION:
In terms of service quality, equal percentage of respondents (50%) were agree
for both the retailers to pursue good services but 30% respondents declared that
the services of easy day are not good.

91

Q.5. Is it easy to enter and exit from the parking lot?

Big Bazaar-

A. yes - 38%

B. no- 62%

Easy Day-

A. yes- 64%

B. no- 36%

100%
90%
80%
70%
60%

yes

50%

no

40%
30%
20%
10%
0%

big bazaar

easy day

INTERPRETATION:
Due to more number of arrivals, it does not seems comfortable for 62%
respondents to enter and exit the parking lot at Big Bazaar, while easy day
proven more comfortable at its parking facility.

92

Q.6 which retail outlet provide the bigger line and variety of the products?
A. Big Bazaar- 40%
B. Easy Day- 30%
C. none of them- 30%

product line & length

30%

40%
big bazaar
easy day

30%

none of them

INTERPRETATION:
40% respondent found that maximum product varieties are available at big
bazaar while 30% respondents easy day as the more product line holder.

93

Q.7. How do the employees behave and respond in outlet?

Very good

good

no response

bad

Big Bazaar-

16%

48%

26%

10%

Easy Day-

24%

50%

14%

12%

easy day

very good
good
no response
bad

big bazaar

0%

20%

40%

60%

80%

100%

120%

INTERPRETATION:
Employees, normally sales personnel are found to behave on a decent manner
at both the retail stores (48% and 50% resp.), but still some customers face
problem at retail stores due to avoidance by the employees.

94

Q.8. what about the ambiance and store environment?

Very good

good

average

bad

Big Bazaar-

20%

40%

20%

20%

Easy Day-

28%

46%

16%

10%

50%
45%
40%
35%

bad

30%

average

25%

good

20%

very good

15%
10%
5%
0%

big bazaar

easy day

INTERPRETATION:
The ambiance of easy day is more influential (46%) than the big bazaar (40%).
Easy day maintained the ambiance to attract more and more customers and
come in the front line among competitors.

95

Q.9. Please rate Big Bazaar and Easy Dayfrom 1 to 5 rating scale?
Big Bazaar

Easy Day

After sale service

Quality of product

Reliability of prices

Attractive promotions

Easy Availability of goods

Ambience

5
4.5
4

after sale service

3.5

quality of product

reliability of price

2.5

attractive promotion

easy availability of goods

1.5

ambiance

1
0.5
0

big bazaar

easy day

INTERPRETATION:
Big bazaar got the advantage of customer loyalty and expertize in the field, thats
why its ranking for all the aspects except quality of service is higher than easy
day.

Q.10. overall, which retail store do you think providing the best service quality?
96

A. Big Bazaar-

54%

B. Easy Day-

18%

C. other-

28%

best service quality

easy day
others
big bazaar

INTERPRETATION:
After looking the entire factor like quality of products and services, ambiances,
customer reach, product range etc., 54% respondents declare Big Bazaar as the
best service quality provider.

97

-7SWOT ANALYSIS

98

SWOT analysis of Big Bazaar:

Strengths:
Huge investment capacity
State of the art infrastructure
Biggest value retail chain in India
High brand equity enjoyed by Big Bazaar
Strong culture, ethics and values are followed
Experienced marketing team & executive staff
A vast variety of stuff available under one roof
Maximum percent of footfalls converted in sales
Emphasis on providing total customer satisfaction
Point of purchase promotion to increase the purchase
EDLP [ Every Day Low Pricing], which attract customers
Available facilities such as online booking and delivery of goods
Cost control initiatives that is critical in a retail operations business
Periodical reviews of the various operations have been done on regular
basis to identify the any possible threat and address the same within time.
Weakness:
Falling revenue per sq. ft.
Overcrowded during offers
Unable to meet store opening targets.
General perception: Low price = Low quality
Unable to meet store opening targets on time
Long lines at billing counters which are time consuming
Unavailability of popular brand items with regard to clothing.
Limited only to value offering low price products. A no. of branded
products are still missing from Big Bazaars line of products

99

Opportunity:
Increasing mall culture in India.
Evolving consumer preferences.
Company has more scope of expansion in two and three tier cities.
A lot of scope in Indian organized retail as it stands at approximately 4%.
More people these days prefer to visit big stores where they can find large
variety under one roof.
Population of the country is growing where the scope of market is kept on
increasing for the retail sector.
Organized Retail less penetrated in India so it acts as a great opportunity
to the organization for its growth.
Economy is developing as the employment opportunities are increasing
and the income of the people is also increasing which increases life
standards of people.
Threats:
Government policies.
Competitors Strategies
Advancement of technology day by day.
International players looking to foray India
Competition from other value retail chains such as Shoprite, Reliance
(Fresh and trends), Hyper city and D mart.
Foreign direct investment cause more problems in future because of that
many mergers and acquisition are happening in Indian retail sector.
Unorganized retail also appears to be a threat to Big Bazaars business. A
large population still prefers to visit local convenient stores for daily
purchases.

100

SWOT analysis ofEasy Day:

Strength:
Variety of stuff under single roof
Maintains good employer-employee relation
Strong culture, ethics and values are followed
Emphasis on providing total customer satisfaction
Effective supply chain and inventory management system.
Advantage of two giant names associated with i.e. Bharti retail and Wal
Mart.
Weakness:
It is in introductory stage in India
Unavailability of popular brand items.
Cut throat competition in Indian retail market.
Its private label brands are not gaining popularity.
Opportunities:
Organized Retail less penetrated in India so it acts as a great opportunity
to the organization for its growth.
Economy is developing as the employment opportunities are increasing
and the income of the people is also increasing which increases life
standards of people.
Company has more scope of expansion in two and three tier cities.
Many regions of India are still remaining untouched by organized retail
sector.
Threats:
Government policies.
Competitors Strategies
Unorganized Retail sector
Foreign direct investment cause more problems in future because of that
many mergers and acquisition are happening in Indian retail sector.
101

-8CONCLUSION:

102

Conclusion:
Big Bazaar and Easy Day both are mix retail store. But after the research done
we concluded that Big Bazaar is better than Easy Day in providing services to the
customers.
Both offer a wide variety of products of different prices and different
qualities satisfying most of its customers.
Prices and offers in Big Bazaar is more reasonable than the Easy Day
have been one of the main attractions and reasons for its popularity.
The price ranges and the products offered are very satisfying to the
customers.
Considering the fact that there are huge middle class families in India,
Big bazaar has had a huge impact on the middle class section of India,
the prices, variety and sales strategy has helped in getting the middle
income groups getting attracted towards Big Bazaar.
The store layout and the assortment of goods is not the best at Big
Bazaar, Customers find it hard to find what they require; this leads to
dissatisfaction of customers.
Big Bazaar is not acclaimed for high class service. The staffs recruited
is not very well trained and the billing queues take a long time to move,
this irritates customers which makes them visit the store more seldom.
The customer get all kind of products in the Big Bazaar, i.e. they are
following good merchandising mix, but in some section like apparels
they have to keep different brands in order to attract more customer.
Word of mouth publicity played major role in making Big Bazaar so
popular whereas media is used to communicate new offers at the
store.
Easy Day need to adopt strategies used by Wal Mart in other countries
like effective supply chain and less inventory in stocks.
Customers are not aware and hence dont avail value added services provided
by the store.Customers are more satisfied with the merchandising present in the
food bazaar and household utensils section.
103

-9RECOMMENDATIONS
AND SUGGESTIONS

104

Recommendations and suggestions:

Customers are becoming price conscious they are having many options in the
market considering the consumer buying behavior the store should take certain
definite steps like retaining customers by giving more quality service to the
customers to match their expectations.
The trend today has been to combine shopping with various offerings for
exchange apart from shopping a customer enjoys food courts, games and many
others services which competitors provide.
Shopping has made people spend not just on their requirements of goods to be
bought but to look on the totality of the experience have of quality service enjoy
the fun zone have a nice time listening to music air temperature etc. finally
everything should be in such a way that ALL UNDER ONE ROOF
The benefits of this totality offering are that many vendors get to have people
patronized their offerings while the shopping experience i.e. being enhanced
more business is got by the stores at the venue. Shopping is no longer a onetime
agenda for people. Various options are opening up.During the analysis it was
found that customers become loyal to few shops or department stores and visit
them often as compared to other. Although it was found all of them keep
approximately same kinds of brands and products and the same pleasing
environment.
All this in mind we need to differentiate our store from others in the city to build up
our own set of customers. It was found that the major problem faced by the
customers is the crowed at the cash counter. The life of todays generation has
become very fast. They dont want to wait in a queue for a longer period. Thus we
must provide better service by speeding up the billing in the cash counters.
One advantage is that there is only one store in the city where as others are the
department stores. So enhance it and make it better to make it different i.e. by

105

having special attraction like body spa, Gym in the store. There should be a
provision for ATMs in the store too.
The following suggestion can be given to Big Bazaar and Easy Day:
Keep brands like Koutons, Cotton County which is well known for offers.
Cleanliness and hygiene should be maintained regularly.
External environment like parking area should be increase as most of
customers face problem of parking specifically during rush hour.
The billing time should be reduced by increasing no. of cash counter
keeping in view customer traffic intensity.
During rush hour they can make provision of less paying counter so
customer who want to purchase single product need not to give up
because of long queue.
Store layout needs to be improved.
Proper signage should be there so that customer can locate the products
easily.
Value added services have to be improved so that most of customers will
avail those services.
They should offer deeper promotions and begin selling a higher
percentage of top-tier national brands and private labels.
They have to reduce prices but not reduce the assortment of their
products.
They should support the communities where they are doing business by
using its infrastructure and helping local school districts pool their buying
and save on textbooks and other merchandise.
They should talk to the unions and local shop owner about their location
so that their living would not or less affected by them.
Let the customers know where they can find the stuff you are never going
to store. You end up making two friends the local store and the
customers.

106

-10APPENDIX

107

QUESTIONNAIRE
Dear Sir/Madam,
I am the student of Poornima School of Management and I am conducting a
survey on Comparative study of Service Quality of Big Bazaar and Easy
Day. The following questionnaire has been drafted to make me understand the
needs and expectations of the customers. Therefore I request you to kindly spare
some time and give me the following information.
Name______________________________________age_________________
Gender_________ occupation _____________income __________________
Contact no. ____________________________ city______________________
Q.1. Have you visited both Big Bazaar and Easy Day?
A. Yes

B. No

Q.2.which retail stores do you prefer for shopping?

A. Big Bazaar

B. Easy Day

C. other

Q.3.Is the store conveniently located?

Big Bazaar-

A. yes

B. no

C. doesnt matter

Easy Day-

A. yes

B. no

C. doesnt matter

Q.4 which outlet is good in terms of degree of service?

Big Bazaar-

A. very good

B. good

C. bad

Easy Day-

A. very good

B. good

C. bad

Q.5. Is it easy to enter and exit from the parking lot?

Big Bazaar-

A. yes

B. no

Easy Day-

A. yes

B. no

Q.6 which retail outlet provide the bigger line and variety of the products?
A. Big Bazaar

B. Easy Day

Q.7. How do the employees behave and respond in outlet?

108

C. none

Very good

good

no response

bad

Big BazaarEasy DayQ.8. what about the ambiance and store environment?
Very good

good

average

bad

Big BazaarEasy DayQ.9. Please rate Big Bazaar and Easy Dayfrom 1 to 5 rating scale?
1-excellent

2-good

Rating Scale

3-average
Big Bazaar

4-disappoinitng

5.very bad

Easy Day

After sale service

Quality of product
Reliability of prices
Attractive promotions
Easy Availability of goods
Ambience

Q.10. overall, which retail store do you think providing the best service quality?
A. Big Bazaar

B. Easy Day

C. other

Any comment:

Thank you very much for sparing your valuable time for me.

109

-11BIBLIOGRAPHY

110

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1. Retail Management ( A strategic approach) by Barry Esrac& Joel Evios
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Times of india
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The Telegraph
DNA
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1. www.scribid .com
2. www.google.com
3. www.springlink.com
4. www.oppapers.com
5. www.wikipedia.com
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