Beruflich Dokumente
Kultur Dokumente
PROJECT REPORT ON
CUSTOMER
SATISFACTION
AT
Jalandhar
Punjab.
Technical Institute
INDEX
Acknowledgement
Executive Summary
Retail-Introduction
Company Overview
10
VRPLs business
13
Domain Area
Financial Management
14
Marketing Management
21
Operations Management
28
MTIC
36
Human Resource
41
E-commerce
46
Road ahead
50
51
Conclusion (S,C,R)
53
Bibliography
55
ACKNOWLEDGEMENT
Words often fail to express ones inner feelings of gratitude and indebtedness to
ones benefactors, but then it is only the readily available medium through which the
undersigned can express his sincere thanks to all those who are associated with the
work in one way or the other. Nothing concrete can be achieved without an optimal
combination of inspiration and perspiration. No work can be accomplished without
taking the guidance of the experts. It is only the critiques from ingenious intellectuals
that helped transform a product into a quality product.
___________
EXECUTIVE SUMMARY:The project is about business development strategy of Vishal Retail in near future as a
part of expansion plan being adopted by the company. This is about all the operations
performed in the Vishal Mega Mart. Retail industry is booming all around the globe at a
very fast pace. Vishal Retail is a known and strong competitor in the retail industry since
23 years. When we talk about Indian market, the demands of every thing which you can
find in every retail store are increasing every year. Indians are famous for their traditions
and festivals and exchanging gifts with friends and relatives is a part of it.
This project report is the study of various activities and strategies of Vishal Mega Mart
and relates it to the theoretical aspects within the scope of our subjects. It also helps us
in understanding the functioning that took place with in an organization from different
perspectives. A questionnaire has been drafted, to try and understand the psyche of the
VISHAL MEGA MART customers to know their needs and expectations which can be
further utilized by the company to gain a competitive edge over their competitors. It also
helps us in understanding the different technologies being used by VRPL.
3. To study the selection and recruitment process of the employees and also
to analysis the training and development method of the company.
LIMITATIONS OF THE STUDY:1. Time available for the project being very short, in-depth study could not be done.
3. Sample size during the survey could not be taken higher due to time constraint.
RESEARCH METHODOLOGY:Methods are the means to accomplish objectives. This study of Vishal Retail is primarily
accomplished through secondary data since the collection of data was made through
5
INTRODUCTION:The Retail Sector is the largest sector in India after agriculture, accounting for over
10 per cent of the countrys GDP and around 8 per cent of the employment. India
has the most unorganized retail market in the world. Most retailers of the
unorganized retail market have their shop in the front and house at the back. The
Retail Industry in India is today amongst the fastest growing industries with several
players entering the market. Currently, the organized retail sector accounts for only 2
per cent indicating a huge potential market opportunity. India is being seen as most
attractive market by retail investors from all over the world. Retail is clearly the sector
that is poised to show the highest growth in the next five years. The sector is set for
a revolution, as both the present players and new entrants are gearing up to explore
the market. The present size of the organized retailing sector is approximately 3%
and is expected to grow to 25-30% by the year 2010. There are about 300 new
malls, 1500 supermarkets and 325 departmental stores currently under construction.
Many players are coming up with huge investments, due to which the present 12
million mom-and-pop shops and kirana stores fear losing their business. Most
predictions say that the sector might reach to US$ 400-600 billion by the year 2010.
Global retail giants such as Wal-Mart, Tesco, Germany's Metro AG and many others are
ready to enter the retail markets. The rising demands of branded products and increase
in purchasing power have lured these companies to enter the market. Modern retail
development in India is focused on the cities like Mumbai, Pune, Ahmedabad, Delhi and
the National Capital Region, Chennai, Banglore, Hyderabad, Kolkata. The leading Indian
retailers are Bata India Ltd, Big Bazaar, Crossword, Vishal Mega Mart., Food Bazaar,
Globus Stores Pvt. Ltd., Liberty shoes Ltd., Music World Entertainment Ltd., Pantaloon
Retail India Ltd., Shoppers Stop, Subhiksha, Titan Industries etc.
6
MODERN RETAIL STRUCTURE:It includesMalls like Ansal Plaza (New Delhi), Nucleus (Pune), Centre Stage (Noida) etc
Discount Stores like Brand Factory, Loot, M&B Factory, Subhiksha, Big Apple,
and Reliance Fresh.
Department Stores like Shoppers Stop, Big Shop, and Pantaloons.
Hypermarkets/ Supermarkets like Big Bazaar, Vishal Mega Mart.
Convenience Stores like Spencers Daily, Tru Mart, Choupal, More.
Multi Brand Outlets like Globus.
CURRENT SCENARIO:A glimpse of the international retail47 global fortune companies & 25 of Asia's top 200 companies are
retailers Dominated by developed countries
US, EU & Japan constitute 80% of world retail sales.
Biggest player in India is Pantaloon Retail India Limited.
GROWTH OF RETAIL SECTOR:The following are the reasons for growth of retail sector in India- Increase in disposable
income of consumers, Increase in consuming desire, Low share of organized retailing.
Purchasing power of Indian urban consumer is growing and branded merchandise in
categories like Apparels, Accessories, Food, and even Jewellery, are slowly becoming
lifestyle products. Retailers are taking benefit of this growth and accordingly are aiming
to expand. Indian retail is expanding at a fast pace. India's retail industry, which is
currently valued at nearly $350 billion, is expected to double in size by 2015. The Indian
Retail Industry is gradually moving ahead towards becoming the next boom industry.
Modern Large-Format retail, efficiently connects the producers and the consumers
and is helpful to both in the long run. In India there is a huge wastage of fresh fruits
and vegetables. In this scenario, the Large-Format Retail provides all important
infrastructures to carry the farm produce to the consumers with lesser wastage. In
this way the farmers get better returns and the consumer better quality and price.
KEY TRENDS:The existing players like Big Bazaar, Shoppers' Stop, Piramyd, and Vishal Mega
Mart are expanding to smaller towns and cities. Many other business houses are
planning to enter the retail sector either on their own or through partnerships.
New entrants like Bharti pvt ltd and Wal-Mart are going to enter the market soon.
Even rural areas will provide a huge opportunity to be explored.
DETAILS OF DIRECTORS:Mr. Ram Chandra Agarwal, 43 years, is VRPLs Chairman and Managing
Director. He holds a bachelors degree in commerce from St. Xaviers College,
Kolkata. Mr. Agarwal has more than 20 years of experience in the retail industry
and has been with VRPL since their inception in 1997. He started the business
under the name of Vishal Garment with a small store at 9, Lal Bazaar Street,
Kolkata. Mr. Agarwal has made efforts for the development of the value retailing
industry in India and is well known for his business acumen.
Mrs. Uma Agarwal, 33 years, is an executive Director of VRPL. She holds a
bachelors degree in arts. Mrs. Agarwal has more than 7 years of experience in
the retail industry. She has been associated with accounts department of VRPL.
Mr. Surendra Kumar Agarwal, 46 years, is an executive Director of VRPL. He
holds a bachelors degree in commerce. Mr. Agarwal has more than 17 years of
experience in the retail industry. He has been associated with store development
and management at various locations of VRPL.
Mr. Bharat Jain, 45 years, is an independent Director of VRPL. He holds
bachelors degree in commerce. Mr. Jain is engaged in the business of leather
garments and accessories and has more than 23 years of work experience. Mr.
Jain joined VRPL Board on May 8, 2006.
Mr. Rakesh Aggarwal, 44 years, is an independent Director of VRPL. He holds a
masters degree in commerce. Mr. Aggarwal is currently engaged in rotomoulding industry has more than 20 years of work experience. Mr. Aggarwal
joined VRPL Board on October 31, 2006.
Mr. Ram Chandra Aggarwal is the husband of Mrs. Uma Agarwal and brother of Mr.
Surendra Kumar Agarwal. None of our other Directors are related to each other.
11
VRPL PROMOTERS AND GROUP COMPANIES:The following individuals are the Promoters of the Company:
a). Mr. Ram Chandra Agarwal;
b). Mrs. Uma Agarwal; and
c). Mr. Surendra Kumar Agarwal.
The following companies are the Promoters of the Company:
a). Unicon Marketing Private Limited;
b). Ricon Commodities Private Limited; and
c). Vishal Water World Private Limited.
The company has during the year 2008, established its five new companies by
the name of VRL Foods Ltd., VRL Movers Ltd., VRL Consumer Goods Ltd., VRL
Fashions Ltd. & VRL Infrastructure Ltd., none of the companies have
commenced business operations during the year.
12
In order to reduce costs and take advantage of economies of scale VRPL have
embarked on backward integration of their products. VRPLs apparel manufacturing
plant is located at Gurgaon, Haryana. For ensuring efficiency in supply chain, VRPL
have set up seven regional distribution centers located around Kolkata (West
Bengal), Thane (Maharashtra), Jaipur (Rajasthan), Ghaziabad (Uttar Pradesh),
Ludhiana (Punjab), Gurgaon (Haryana) and Delhi. Further, VRPL have focused on
developing a cost and time efficient distribution and logistics network, which currently
comprises seven distribution centers and a fleet of trucks for transportation.
VRPL achieved total sales of Rs. 1005.31 cr for fiscal 2008, as opposed to a
turnover of Rs.602.65 cr for fiscal 2007 and Rs. 288.46 million for fiscal 2006.
During the same period VRPLs profit after tax was Rs. 40.64 cr, Rs.25.07 cr and
Rs. 12.39 cr, respectively.
13
F I NAN C IALMANAG E M E N T
OBJECTIVES:-
BALANCE SHEET
Vishal Retail
Balance Sheet
Sources Of Funds
Total Share Capital
Equity Share Capital
Share Application Money
Preference Share Capital
Reserves
Revaluation Reserves
Net worth
Secured Loans
Unsecured Loans
Total Debt
Total Liabilities
Application Of Funds
Gross Block
Less: Accum. Depreciation
Net Block
Capital Work in Progress
Investments
Inventories
Sundry Debtors
14
12.31
2.52
9.79
0
0.98
20.27
0
14.82
14.82
0.09
0
15.49
0
30.4
19.56
3.1
22.66
53.06
Mar '05
12
mths
24.01
5.42
18.59
0
0
37.4
0
22.1
16.49
0
5.61
50.6
0
72.7
47.61
7.44
55.05
127.75
Mar '06
12
mths
45.99
10.6
35.39
4.64
0
78.2
0.09
18.32
18.32
0
0
108.44
0
126.76
216.3
26.91
243.21
369.97
Mar '07
12
mths
132.93
25.77
107.16
1.09
0
249.15
0.12
Mar '07
12
mths
22.4
22.4
0
0
248.76
0
271.16
448.9
83.9
532.8
803.96
Mar '08
12
mths
262.3
53.37
208.93
20.51
0.13
557.47
0
Mar '08
12
mths
2.04
2.2
8.06
14.18
50.17
22.31
3.22
0
39.6
6.12
0
86.35
32.59
0.21
263.45
66.28
0.97
607.64
122.13
4.79
25.53
0
6.48
0.56
7.04
18.49
0.02
29.28
45.72
0
9.68
1.57
11.25
34.47
0.01
53.07
119.15
0
23.7
7.74
31.44
87.71
0
127.74
330.7
0
48.51
20.47
68.98
261.72
0
369.97
734.56
0
117.14
43.02
160.16
574.4
0
803.97
Contingent Liabilities
Book Value (Rs)
0
10.99
0
20.45
3.75
40.68
4.48
69.18
6.98
121.06
15
------------------- in Rs. Cr. ------------------Mar '04 Mar '05 Mar '06 Mar '07 Mar '08
12 mths 12 mths 12 mths
12 mths 12 mths
Income
Sales Turnover
Excise Duty
Net Sales
Other Income
Stock Adjustments
Total Income
Expenditure
Raw Materials
Power & Fuel Cost
Employee Cost
Other Manufacturing Expenses
Selling and Admin Expenses
Miscellaneous Expenses
Preoperative Exp Capitalized
Total Expenses
Operating Profit
PBDIT
Interest
PBDT
Depreciation
Other Written Off
Profit Before Tax
Extra-ordinary items
PBT (Post Extra-ord Items)
Tax
Reported Net Profit
Total Value Addition
16
88.10
0.00
88.10
0.11
8.02
96.23
66.49
0.00
3.02
8.84
0.00
14.87
0.00
93.22
Mar '04
12 mths
2.90
3.01
0.21
2.80
1.47
0.00
1.33
0.00
1.33
0.95
0.38
26.73
146.31
0.00
146.31
0.14
15.37
161.82
288.46
0.00
288.46
0.31
40.70
329.47
104.77
216.74
0.00
8.69
6.04
15.13
13.49
12.83
0.00
45.07
28.63
4.06
0.00
0.00
152.93
302.52
Mar '05 Mar '06
12 mths 12 mths
8.75
26.64
8.89
26.95
0.98
3.08
7.91
23.87
2.92
5.36
0.00
0.01
4.99
18.50
0.00
0.10
4.99
18.60
1.98
6.22
3.02
12.39
48.16
85.78
602.65
0.00
602.65
2.39
226.30
831.34
1,005.31
0.00
1,005.31
7.76
300.45
1,313.52
573.47
862.68
17.28
29.72
30.01
72.31
20.48
9.32
109.23
192.21
10.47
17.50
0.00
0.00
760.94 1,183.74
Mar '07 Mar '08
12 mths 12 mths
68.01
122.02
70.40
129.78
15.73
38.99
54.67
90.79
15.29
27.60
0.00
0.00
39.38
63.19
-0.11
0.00
39.27
63.19
14.20
22.55
25.07
40.64
187.47
321.06
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
148.20
2.04
0.00
20.45
164.91
7.51
0.00
40.68
183.25
13.68
0.00
69.18
223.99
18.14
0.00
121.06
17
CASH FLOW
Vishal Retail
Cash Flow
---in Rs. Cr.---
Mar '06
12
mths
18.82
-28.21
Mar '07
12
mths
Mar '08
12
mths
39.38
63.19
-102.41 -197.49
-25.91
60.38
-95.18
204.47
-114.58
356.24
6.06
2.2
8.27
6.89
8.27
15.15
44.17
10.79
54.96
1
8
Vishal Retail Ltd. Stock:BSE: 532867 | NSE: VISHALRET | ISIN: INE945H01013 | Trading
PE ratio
1.79
(24/03/09)
EPS (Rs)
10
9.39
(Mar, 08)
4.01
(Mar, 08)
Current Ratio
4.59
(Mar, 08)
Quick Ratio
1.10
(Mar, 08)
Depending upon the success or failure of the Management to role over the debts and
manage additional funds, this share will either zoom or go bust. The company is in talks to
roll over more than Rs 90 crore of debt owed to banks. Company officials say the retailer is
not generating enough cash. We have not been able to generate positive cash flows from
our operations in the first two months of this quarter, said Chief Executive Manmohan
Agarwal. Therefore, the next two quarters will be critical for the company, as sales are
expected to fall further. The companys third-quarter profit dropped 86 per cent to Rs 2.15
crore. CARE Rating, while downgrading the retailers short-term bank facilities, said the risk
was accentuated due to the companys inability to carry out a
19
20
MAR K E TI N G MANAG E M E N T
21
22
Price
Vishal Mega Mart promises its consumers the lowest available price. The concept of
psychological discounting (Rs. 99, Rs. 49, etc.) is used as promotional tool. Vishal Mega
Mart also caters on Special Event Pricing (Close to Diwali, Christmas, New Year etc.).
Selling combo-packs and offering discount to customers. The combo-packs add value to
customer. Through Bundling, they also reduced the price of the products. In addition to
VRPLs strategy to continue procurement of goods from small and medium size vendors
and manufacturers which leads to cost efficiencies, VRPL intend to procure FMCG and
apparels from low-cost production centers located outside India. Towards this objective,
VRPLs propose to increase their procurement of finished and semi-finished goods from
China and thereby realize economies of scale and pass on the benefits so accrued to
their customers. The efforts of VRPLs retail business are targeted towards families
having total income which can be classified under the lower middle and middle
income groups. VRPL follow uniform pricing policy across their stores in respect of
private labels and non-branded products sold by them. This enhances brand loyalty,
encourages customer confidence and results in operational convenience. In relation to
the other products, the prices may vary between stores on account of state-specific
taxation and vendor policies.
Place
Vishal Mega Mart stores are located in 110 cities with more than 180 outlets. Vishal
Mega Mart has presence in almost all the major Indian cities. They are aggressive on
their expansion plans. VRPL intend to increase their penetration in the country by setting
up new stores in cities where they already have presence, as also entering into new
areas in the country. In particular, they intend to focus on expansion in Tier II and Tier III
cities. VRPL target locations with good infrastructural facilities such as easy accessibility,
provision for water, electricity, parking, security and other basic amenities.
23
Promotion
Advertising has played a crucial role in building of the brand. Vishal Mega Mart
advertisements are mainly seen in print media i.e. newspapers, Television with Tina
Parekh as there in advertisement, and sometime road-side bill-boards. VRPLs category
management system is used to plan promotional schemes. They launch promotional
schemes weekly. Apart from general sales promotion, the category manager formulates
promotional plans for slow movers. In addition, to promote sales, they focus on layout
of the stores and positioning, presentation and display of merchandise, in order to
appeal to the customer. In addition, VRPL have introduced, in association with SBI
Cards & Payment Services Private Limited, a co-branded credit card. VRPLs propose to
continuously undertake such initiatives to increase the satisfaction of their customers.
Some of the features of the co-branded card include Rs 250 discount voucher on signing
up for the card and a process by which the cardholder earns five reward points on every
Rs 100 spent. A cardholder accumulates points on the basis of purchases made and the
points accumulated can be redeemed for gifts or purchases. In September 2005, VRPL
entered into a long term advertising agreement with Bennett, Coleman & Company
Limited (BCCL). Under the agreement, they are entitled to fixed discounts for their
advertisement in print publications of BCCL for a period of five years from the date of the
agreement. In addition, BCCL would also act as a facilitator for other print and non-print
media of the Times Group i.e. internet, radio and television or any other new medium
launched during the tenancy of the agreement. As a part consideration, VRPL had
issued 1,670,605 Equity Shares of Rs. 10 each and 384,190 Preference Shares of Rs.
146 each amounting to an aggregate of Rs. 300 million.
24
25
1.
2.
3.
4.
5.
6.
__________
N
a Income:_________________(
m optional)
e
: Gender:__________________
_
_ Age:__________
_
_ Occupation:_______________
_ __
_
_ What excites you most for
shopping at Vishal Mega Mart?
A _____ Utensils_____
Promotional offers_____ Any p
Electronic
other plz specify_________
p
goods__________
a
Variety of products______
r 8. How often do
Price of the products_______ e
you come at Vishal
l Mega Mart?
7. What do you usually buy s
from Vishal Mega Mart?
_ Within a
FMCG products______
Child _ week________
_
Within 2
care & Toys______
_ week______
Within a month______
Above 1 month____
Average_____
Unsatisfactory_____
26
10.
Are you satisfied with the quality of the products offered by Vishal Mega
Mart?
Yes____
11.
No_____
Somewhat satisfied_____
Billing Problems_____
Heavy Rush_____
No problems faced_______
12.
How would you rate your overall experience in this retail outlet? (Rate on
a 10 point scale)
_______________
13.
Any complaints:-
____________________________________________________________________
____________________________________________________________________
________________________________________________________
14.
Any suggestions:-
____________________________________________________________________
____________________________________________________________________
____________________________________________
2
7
O P E R AT I O N S M A N A G E M E N T
Establishment of Stores
Selection of location
In selecting location for a new store, VRPL start by identifying the city/town. VRPL
target primarily cities/towns which may be classified as Tier II or Tier III cities. In this
regard, an analysis of the demography, literacy levels, nature of occupation and
income levels. Within a city/town, VRPL target locations with good infrastructural
facilities such as easy accessibility, provision for water, electricity, parking, security
and other basic amenities. VRPL prefer to locate their stores in areas where real
estate is available at reasonable prices. The efforts of VRPLs retail business are
targeted towards families having total income which can be classified under the
lower middle and middle income groups. Accordingly, VRPL plan their strategy to
search for areas within cities where such customers are domiciled in large numbers
and make efforts to locate themselves within the reach of such customers.
VRPL believe that adoption of standard formats for their stores has led to their brand
establishment and identification among their customers and will increase their base of
loyal customers. In pursuance of this, they have adopted standard parameters for store
planning and establishment. For ensuring standardized formats of their stores, VRPL
consider various factors, such as internal and external dcor and colour schemes,
28
allocation of store space, stock mix and pricing and accounting methods.
Insurance
VRPL maintain comprehensive insurance coverage with Tata AIG, Bajaj Allianz,
Royal Sundaram and IFFCO-TOKIO for their existing stores, distribution centers,
manufacturing facilities and trucks. VRPL insurance policies include comprehensive
coverage for electronic equipment, fire and special perils and burglary.
Further, VRPL has filed a claim of Rs. 22.50 million on account of fire in their
store at Meerut as on July 7, 2006. In this regard, they have received Rs. 7.50
million as an interim payment.
Factories
VRPLs existing manufacturing facilities are located at Plot No. 224, Phase 1
Udyog Vihar, Gurgaon, for which they have leasehold interest until May 4, 2009.
In addition, VRPL have recently acquired freehold interest in relation to a land
admeasuring 7.24 acres in Dehradun, Uttaranchal, where they are exploring the
possibilities for establishment of another manufacturing facility.
Other Properties
VRPL have recently acquired freehold interest in relation to a land admeasuring
82,830 square feet in Hubli, Dharwad.
Merchandise Planning
VRPLs merchandise planning is based on the concept of category management
rather than traditional brand management practices.
Apparels and Non Apparels
Under category management for, say, apparels, VRPL create and cater to products across
length and breadth of a category at different price points, fabrics, designs, shapes, seasons,
colors and sizes. VRPL formulate annual merchandising plan for each division of
merchandise taking into consideration factors such as past sales data, regional customer
tastes and preferences, number of stores (established and proposed), likely
29
VRPL draw annual sales projections for different SKUs and, accordingly,
ascertain their sourcing requirements. Based on such information and lead time
estimates for supplies, purchase orders with delivery schedules are issued. The
inventory position for each SKU is reviewed fortnightly taking into account the
actual sales and variations from the budgeted plans. Regular visits to the stores
are made by the category merchandising team to identify the slow-moving-SKUs
and explore the options to expeditiously dispose of them.
For certain non apparel categories, their merchandise planning and scheduling
also depends on introduction of new products and schemes by the vendors. For
instance, if a branded home appliance manufacturer replaces a product with a
new version, then their planning for the product would need to be reviewed
based on the acceptability of the new version.
In-house Manufacturing
VRPL benefit from backward integration and in-house manufacturing of part of the
apparel products sold in their stores. Through their manufacturing capabilities, VRPL
is able to attain relative independence from intermediaries with a competitive
advantage in terms of value and cost. VRPL use their manufacturing strengths to
focus on enhancing product knowledge and their experiences from manufacturing
enable them to negotiate better terms from the vendors and job workers.
VRPL currently have an apparels manufacturing plant at Gurgaon, Haryana. The
manufacturing plant is well-equipped with fully automatic machines for fusing, buttoning,
embroidery and welt pocket-making operations. The factory has a capacity to
30
Upon ascertaining the procurements needs based on each SKU, VRPL explore
the various options for sourcing the products. They continuously strive to procure
goods from the place of origin to reduce the costs and control the quality. For
identifying the vendors, VRPL assess the various possible options on factors
such as capacity, credibility in the market, quality awareness and experience.
After identifying the vendors for the goods, VRPL place purchase orders based on their
SKU-wise plan, estimated lead time of each vendor and quantity to be procured from
each vendor. VRPL follow a policy of payment on delivery to negotiate better prices
31
Since most of the arrangements with the large manufacturers or their distributors
are for supplies across the country, they facilitate VRPL to expeditiously launch
new stores, as VRPL do not have to identify local sources for supplies of the
FMCG products. Such arrangements also help VRPL in standardizing the
promotional schemes across all VRPL stores.
For some of the FMCG products, such as staples and food grains, they purchase
in bulk and break them down into smaller packages for sales. Further, based on
their assessment of regional tastes and preferences, VRPL purchases some
products locally from small and medium size vendors.
Apparel Manufacture
The basic raw materials required for the manufacturing process of apparels includes
fabrics and accessories. VRPL merchandising teams source fabrics from local
manufacturers in India depending upon their production plan. VRPL also source fabrics
from the place of origin. VRPL source various other components and accessories from
vendors in various parts of the country and also import them from China.
They have built a system to monitor the inventory position on a real-time basis at
each store, under which a stock requisition or delivery order is generated when predetermined stock or re-order levels are reached. The re-order levels for stores are
determined based on factors such as display levels, lead time for replenishment and
average daily sales. VRPL review these re-order levels on continuous basis to factor
in variances in demand based on seasons, trends and promotional schemes.
VRPL have seven distribution centers over approximately 385,033 square feet. These
distribution centers are located around Kolkata (West Bengal), Thane (Maharashtra),
Jaipur (Rajasthan), Ghaziabad (Uttar Pradesh), Ludhiana (Punjab), Gurgaon (Haryana)
and Mahipalpur (New Delhi). VRPL have clearly demarcated the stores which will be
serviced by each distribution centre. The reorder levels for distribution centers are
ascertained on the basis of factors like average daily sales of all the stores services,
lead time for replenishment and buffer stock, which caters to both the existing and
proposed stores to be fed. As for the stores, they regularly review these re-order levels.
33
Internal Controls and Cost Reduction Measures:As a value retail chain, VRPL emphasize on reduction of costs at various stages
and levels. In addition to reduction of costs of procurement and by way of
optimization of inventory, VRPL employ on the following measures to enhance
efficiencies and reduce operational and administrative costs:
Pilferage Control
VRPL have established three-layer security checks to control losses on account
of pilferages at their stores. At the first level, VRPL employees screen the goods
being carried out of the store by the customers. Professional security guards
oversee the screening process. Lastly, VRPL have deployed electronic sensors
to check any pilferages. In addition, all VRPL stores are covered by closed circuit
television monitoring.
Resource Utilization
VRPL believe in reducing operating and administrative costs by way of optimum
utilization of their human and other resources. For instance, they determine the
staffing requirement on basis of a matrix containing factors such as store space
and footfall intensity. VRPL also train their employees to assume cross-functional
responsibilities. As a measure for optimum utilization of their space resources,
they have adopted an efficient racking system by deploying relatively higher
racks to maximize the space available in a store. The upper slabs of a rack are
utilized for storage and the lower ones for display. This helps VRPL in eliminating
the need of dedicated storage spaces is most of VRPL stores.
Efficiency of Processes
VRPL believe in adopting processes which are efficient. For instance, they ensure
that about a quarter of the staff at a new store is deployed by transferring from their
existing stores. This helps in ensuring that a new store is operated efficiently and
that the freshly recruited staff receives on-the job training from the experienced staff.
VRPL believe in continually reviewing and re-engineering various operational and
administrative processes to make them both more efficient and cost effective.
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Wastage Monitoring
VRPL endeavor to reduce wastage of goods at various stages. For instance, for
transportation of goods in their trucks, they use iron boxes instead of cardboard
cartons to ensure that the damage in transit is minimized. In addition, iron boxes
have a longer life and have been more cost efficient.
VRPL store at Agra, which was operated by a franchisee, has been destroyed by
a fire on November 27, 2006 and is currently not in operation.
In addition, VRPL have entered into commission or joint venture arrangements for one
store each in Bhubaneswar and Siliguri with the owners or lessees of the immovable
properties where such stores are located. For the Siliguri store, VRPL operate the store
and are obligated to pay a commission of 2% of the net sales per month from the store,
subject to a minimum of Rs. 224,000 per month, subject to certain escalation provisions.
Under the joint venture arrangement for VRPL Bhubaneswar store, VRPL operate the
store and are obligated to pay commission of 2% on total monthly turnover of the store
and fixed commission of Rs. 113,300 per month subject to certain escalation provisions.
35
MANAG E M E N TO F TE C H N O LO G Y,
I N N O VAT I O N & C H A N G E
Beyond the bar code is RFID (radio frequency identification) where a chip within a
tag carries information and is read using radio waves. Vishal Mega Mart uses the
latest technology to improve its performance Quality as well as Quantity Wise. Bar
code scanners are very sophisticated devices these days. Functionality and reliability
is extremely important. Vishal Mega Mart also uses CCTV to monitor its stores.
Various CCTVs are being installed in a store, with a room where the entire
functioning taking place in a store can be monitored by a human operator.
VRPL have partly implemented their information technology set up and are currently in
the midst of completing the process of upgrading their information technology set up and
37
Limited
for
providing
information
technology
services
including
38
4. WMS software
Functional Area:
Distribution and Logistics.
Comments: WMS enable the space planning and also integrated SKU location
which enable faster picking and putting of merchandising.
5. Arthur Planning software
Functional Area:
Merchandising Planning.
Comments: An integrated planning and decision making tool. 6.
Microsoft Exchange software
Functional Area:
Internal/External communication.
Comments: Enterprise wide mailing solution.
40
H U MAN R E S O U R C E S MANAG E M E N T
organizational requirement. The industry needs skilled manpower to fit the diverse
roles at the front-end and back-end of the new and complex retail formats. It is
estimated that over 2.5 million jobs will be created in the sector by 2010. The
complexity of the operations requires trained personnel. The modern formats require
staff to handle administration, public relations, advertising, store management,
sourcing, and merchandising and information management. A number of reputed
institutes have started offering specialized courses in retail management.
The Company places a huge emphasis on fostering a culture of innovation and enterprise
that allows people within the Company to realise human beings' infinite potential. The
Company continues to increasingly focus on internal growth and development of its
associates, cutting across levels and functions, through focused developmental efforts and
growth opportunities. For the year under review, the Company has provided 66 hours of
training per associate. Apart from regular training in skills enhancement and customer
engagement, the Company also emphasizes on building a sense of pride, belonging and
self-confidence among its employees working at the stores.
It has been able to employ innovative strategies to attract talent from other industries.
Their human resource policies are targeted at creating an engaged and motivated work
force. They have a fairly young team with the average age of the organization being 26
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4,440
Graduates
2,081
Post Graduates
417
Total
6,938
Training
VRPL encourage their employees to be enterprising and expect them to learn on the
job and contribute constructively to their business, either through ideas, personal
networks or effective knowledge management. In essence, they train their employees to
become next generation entrepreneurs, who can effectively lead the growth of their
business. Their corporate objective is to provide every associate with an average of 5
man days of training per annum through internal and external resources.
All senior management members are required to contribute 30 hours per annum
towards training.
2. Application blank.
3. Personal Interview, Operations Interview, Regional Manager Interview.
For Area Manager:
1. Well-trained staff, the staff employed by Vishal Mega Mart is well-suited for
43
4. Multiple counters for billing, staff at store to keep baggage and security
guards at every gate, makes for a customer-friendly atmosphere.
5. The employees are motivated to work efficiently and effectively towards the
achievement of organizational goal by satisfying their personal needs.
6. The employees were given bonus and gifts during the festivals like diwali, etc.
4
4
45
S.K.Agarwal
Whole-time
Director
R
.
C
.
A
g
ar
w
al
C
h
ai
r
m
Category
a
Heads
n
&
M
a
n
Me a
rch g
an i
dis n
e g
H
eD
ai
dr
e
c
t
o
r
B
Chi
o
ef
a
Op
r
era
d
tin
g
o
Officer
f
Head
Supp
ly
Heads Zonal
Chain
Management
HeadRetail
Head IT
Head-Admin &
HR
4
6
E- COMMERCE
OBJECTIVES:1 To study the different steps taken by VRPL in relation with online shopping.
2 To try and understand the importance of Vishal Mega Mart website.
The uses of computers and internet have been expanding significantly over the years.
Presently internet has been used widely as a means of communication, as a potential
source of information, as a means of entertainment and many more. With in few years
after existence of internet, business men realized the possibilities of using internet as a
medium of business. This idea kick started the first online business ventures. Modern
technology has been developed to the extent that even shopping made possible over the
internet. The process of shopping done over the internet is called online shopping.
47
48
How to Shop
Firstly,
you
have
to
register
yourself
with
the
shopping.indiatimes.com
&
shopping.rediff.com. Place your order through following these 7 quick and easy steps:
7. View or print your Order Acknowledgment and check your Order status.
Here are a few important action points that you should bear in mind:1. Keep your PC updated with the latest anti-virus / anti-spy ware software.
2. Install a personal firewall on your PC to protect your account.
3. Keep your PC updated with the latest security patches and, most importantly,
4. Do not click on links or open attachments in unknown or unsolicited
(spam) emails.
50
multiple retail formats with expected sales of Rs.90, 000 crore-plus ($20 billion) by
2009-10.
RPG: Planning IPO will have 450-plus Music World, 50-plus Spencer's
Raheja's: It Operates Shoppers Stop, Crossword, Inorbit Mall, and 'Home Stop'
formats. Will operate 55 Hypercity hypermarkets with US$100 million sales across India by
2015.
TATA (Trent Ltd.): Trent to open 27 more stores across its retail formats
adding 1 mn sq.ft of space in the next 12 DLF malls. Titan industries to add 50plus Titan and Tanishq stores in 2010.
51
Findings
1. The choice of a store location has a profound effect on the entire business
life of a retail operation. A bad choice may all but guarantee failure, a good
choice, and success.
2. Choosing a retail location is, at best, a risky undertaking. Considering the
consequences of choosing a location that proves to be unsuitable, it pays to get
as much assistance as possible. According to a survey more than 60% of the
customer prefers to shop in a retail store which is easily accessible to them.
3. Advertising plays a very important role in achieving growth for any retail
company. This is evident from the fact that Advertising by Retail Industry
registered a rise of 12 percent during January - May 2007 over January May 2006.
4. The right location, trained manpower, software assistance, product with a
distinct differentiation, a strong value proposition, efficient supply chain
management - these are the factors that influence the success of a retail
outlet. With competition in this segment increasing, differentiation and a
strong value proposition assume significance. Retail chains are realizing that
they cannot be another me-too store. The differentiation today among the 56 retail chains has come through private labels, which in some cases account
for as much as 70 per cent of the total merchandise in the outlet.
5. Variety offered by any retail store is of very much important to attract all
type of customers in the stores. A large variety of products caters to each
segment of customers.
6. Shopping experience within a store also has a great impact on selecting a
product from a particular retail store. Overall ambience includes infrastructure
facilities provided by the store such as air conditioners, lighting etc.
5
3
Conclusion
Suggestions:1. Include more trained sales person to help customers in the store while shopping.
2. Improve quality of the products especially clothes.
3. Play good songs or soothing music in the store rather than cheap filmy songs.
4. Customer care service can be introduced
5. More branded products can be displayed in the store as people still prefer
branded clothes than offered by local venders.
6. Constant reminder of discounts through pamphlets, speakers inside the
store for inducing consumers for impulse buying.
7. Add more cosmetic products as its having a huge market of consumers
attached to it.
8. Display of product should be improved so that the product is easily visible
to the consumers.
9. Proper advertisement in press and outdoor to make Vishal Mega Mart
should be visible in the eyes of consumers.
10. Should have parking spaces in front of every store.
11. Hire more salesgirls as in ladies section its very difficult for both the
consumers and salesman to interact with each other.
12. Regular training to sales person to improve there overall performance.
Complaints: 1. Low variety of product available and customization of products is not there.
2. Air conditioners are not properly working
3. Prices are not mentioned at all places and at all products.
4. Prices are not competitive as they are assumed to be higher when
consumers are visiting other retail outlets.
5. Grocery items are not sufficient and they are not at all available at many stores.
6. Clothing items of women are priced unreasonably
7. Lack of space in the store while shopping and moving within a store.
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55
BIBLIOGRAPHY:1. http://www.vishalmegamart.net/
2.
http://www.moneycontrol.com/india/news/OTHER%20NEWS/sbi-cardvishal- mega-mart-launch-co-branded-credit-card/22/46/205965
3. http://www.moneycontrol.com/india/stockpricequote/trading/vishal-retail/VR02
4.
http://www.cxotoday.com/India/News/Vishal_Megamart_Deploys_PRILs_Retail
_Excel/551-75867-911.html
5. http://www.televisionpoint.com/news/newsfullstory.php?id=1127933505
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