RETAIL MANAGEMENT

UNIT 1
1.IMPORTANCE OF RETAILING:
Customer Convenience: Perhaps the most important role of bringing the ready to be
consumed goods to the doorstep of the consumer is performed by the retail
community. Consumers benefit from retailing as retailers perform marketing functions that
makes it possible for customers to have access to a broad variety of products and services.
Retailing also helps to create place, time and possession utilities. A retailer's service also
helps to enhance a product's image. Retailers stock goods and ensure the availability of
products and services just when the customer needs them. Convenience Stores operate over
extended hours through the week and give customers greater flexibility and choice.
Accessibility: Products and services have no value for consumers until they are acquired and
used by the customers. Retailers acquire products and services from different places and.
assort them at a single point as per the needs of the consumers and thus facilitate customers'
access.
Convenience of Size: Retailers break bulk and serve the products in quantities and sizes as
desired by the customer. For example, shampoo is available in small sachets. The retailer
helps consumer by providing appropriate products, service and advice in the packing and
quantities desired by them.
Associated Services: A vibrant retail sector benefits the consumers by providing range of
products and services efficiently. Retailing can be done in either fixed locations or online.
Retailing includes subordinated services, such as delivery. The term "retailer" is also applied
where a service provider services the needs of a large number of individuals, such as a public
utility, like electric power. Retailing also helps to increase the living standards and enable the
consumers to possess various goods, services and utilities.
Supply Chain: Retailers are part of an integrated system called the supply-chain. A retailer
purchases goods or products in large quantities from manufacturers or directly through a
wholesaler, and then sells smaller quantities to the consumer for a profit. Retailers participate
in the sorting process by collecting an assortment of goods and services from a wide variety
of suppliers and offering them for sale. The width and depth of assortment depend upon the
individual retailer's strategy. Retailers provide the vital link between producers and ultimate
consumers.
Value Chain: When consumers purchase goods, retailers must order more goods to replenish
their stock. In turn, factories must manufacture the goods for the retailers. The factories then
purchase more raw materials to use to manufacture more goods. This is how consumer
spending is able to drive much of the economy.

Research & Information: The retailer provides useful information across the supply chain.
He informs and educates customers about product features and benefits. They provide
information to consumers through advertising, displays and signs and sales personnel.
Marketing research support is given to other channels, members. Retailing in a way, is the
final stage in marketing channels for consumer products. He also provides feedback about
consumer requirements to the manufacturers and wholesalers which help them in planning
production and supply.
Mobilizing Finance: Retailing industry mobilize the investment and savings of people, as a
small shop can be set up with minimal investment. They store merchandise, mark prices on it,
place items on the selling floor and otherwise handle products; usually they pay suppliers for
items before selling them to final customers. They complete transactions by using appropriate
locations, and timings, credit policies, and other services e.g. delivery. They influence life
style of consumers and help people to build their identity in a social setting.
Economic Development: Retailing has great impact on economic development of a nation.
Retailing has become an intrinsic part of our daily lives. Consumer spending on retail goods
drives much of the global economy, and the retail industry employs a large number of people.
Nations that have enjoyed the greatest economic and social progress have a vibrant retail
sector. Retailing is one of the most important industries in the world and plays a predominant
role in economic development of the country. A healthy retail sector growth and speeds up
economic development.
Employment: There are a large number of people and companies involved in the production,
distribution, and retail of goods. Globally, retailing is the largest revenue generator and
employment provider next only to agriculture. It provides opportunities to the poorest and
unskilled along with the educated and skilled. As a major source of employment retailing
offers a wide range of career opportunities including; store management, merchandising and
owning a retail business.
Social Responsibility: Successful retailers also recognize that people want to see the
improvements in the general level of consumption and social cohesion over time. Retailers
have to enhance their perceived value to the community by acting as a focal point and
through effective public relations and promotional campaign including sponsorships. This
encourages social responsibility behaviour by the corporates where public welfare programs
get funded by a certain percentage of purchase prices of company's products.

2.THE EVOLUTION OF SHOPPING MALLS IN INDIA

Its been more than a decade since organised retail came up in India. In the early phase of
development, it was just restricted to plaza culture. Post 2003, mall culture started
multiplying in the metro cities, and India started becoming the hub of organised retail. The
modern Indian retail industry has gone through a plethora of changes to attain the stature that
it has now. This article shows the way forward to establish successful retail and real estate
synergies.

The organized retail trend started in India in 1999 with the launch of Ansals Plaza in Delhi,
which was followed by Crossroads in Mumbai and Spencer Plaza in Chennai. Until the end
of 2002, only three shopping malls existed in India. Post 2003, mall culture started
multiplying in the metros. Cities like Mumbai, Bangalore, Kolkata, Chennai readily accepted
the mall culture and so began a trend that was to catch on extremely fast.
The next half decade went well for the retail-real estate synergy. The year 2007-08 saw a
huge growth rate in mall space all over the country.
The Recession of 2008
However, by the dusk of 2008, India was hit by recession which in-turn affected the retail
sector as well. Mall culture witnessed a slowdown and mall mania became mall ordeal. The
tide had turned for developers and retailers who had blindly jumped into the mall business
without understanding the demographics and demand. From Gurgaon to Ahmedabad,
consumers were walking out of malls.
However, every cloud has a silver lining. The downtrend taught Indian developers and
retailers a lot. They started inputting more expert knowledge into the making of mall. They
realized that the conceptualization of a shopping mall was not like building a residential or
commercial tower and professional assistance became essential. Multiple oors, high vacancy
rates, non-viable locations and poor commercialization were all done away with. The waters
changed again and this time in favour of realtors and retailers.
The mall culture that was formed from 2011 onwards was something that India had never
seen before. Retail-real estate synergy started witnessing an uptrend in metros from 2012
onwards.Consumer outlook towards the mall changed in 10 years from just viewing it as an
entertainment centre to seeing it as a complete shopping experience.
The E-Commerce Threat
With the advent of e-commerce in 2014, realtors again started anticipating a threat. Though
they didnt get cold feet, they did start strategizing having learnt from past mistakes
thinking of more and more creative ways to retain spending customers.
Around this time when shopping malls were struggling to leave behind the lingering effects
of the economic slowdown and survive the onslaught of e-commerce rms, Select

CityWalk Delhi, High Street Phoenix Mumbai, and Express Avenue Chennai were
launched.

The winds changed direction once again and malls became all-the-rage. Today, Select
CityWalk is clocking sales of Rs 2,750 per square foot per month, High Street Phoenix does
about Rs 2,200 and Express Avenue, about Rs 1,400. A mall is considered to be performing
good if its average sales is between Rs 900 1,500 per square feet per month.
Mall Management
One of the factors that is critical to the success of malls is mall management. Malls must go
that extra mile to cater to every need of their customers. Thus the need for managing malls
eectively and eciently through SOPs (Standard Operating Procedures), is becoming the
urgent need of the society and business as a whole.
Now, mall managers must strive for eective operations and maintenance of the entire
building, infrastructure; including the services and utilizes and ensure that they are used in a
way that is consistent with the purpose for which they were built. Further, mall management
also helps in nding the right kind of tenants, while leasing out space to tenants. Mall
management has been identied as a critical factor for the success of malls and the retail
industry across the world.
Mall management broadly includes mall positioning, zoning, tenant mix,
promotions/marketing and facility/nance management.
Mall Layout & Customer Walk Flow Management
Another important factor to be considered is the mall layout and customer walk flow
management. To be ahead in the race of attracting people and creating uniqueness, malls must
focus on creating a layout which gives maximum visibility to retailers, providing them with
ample display space, tactfully and technically using dead spaces, and creating focal points to
attract customers.
As malls are turning to community centres, it becomes dicult for mall managers to control
the vast number of visitors. Malls simply cant shut their doors after a certain number of

people enter, saying we have enough crowd. Thus mall developers need to consider
entertaining hundreds of people when designing a building.
Malls need to manage foot traffic and parking facilities as well. Foot trac management
involves crowd management inside the operational area of a mall. The ow of people is
related to the design of the mall and the spatial distribution of its tenants. For example, a starshaped mall tends to have a problem of crowding in the centre of the mall, as everyone has to
pass through the centre while moving from one side to the other. On the other hand, circular
malls usually do not face the problem of trac congestion because they tend to have better
pedestrian ow.
Managing parking facilities includes provision of ample parking and management of vehicles
in the parking lot. Branding and advertising is one of the latest trends in retail mall retail
estate that vacant spaces are being used for advertising displays to promote malls, its retailers
and the retailers products. This can often be hi-tech, involving the use of digital displays, and
draw the shoppers attention to specic merchandise or promotions in a nearby store.
Malls have changed shopping experience
Malls are not only a shopping place but a place to rejuvenate, socialize and entertain. In big
retail stores you get everything under one roof from branded clothes, grocery, electronics to
foot wear. Without a doubt malls have changed the shopping experience of Indians. Doing
shopping in the scorching heat of the sun has been replaced by AC shopping. Youth take this
as a status symbol. Visiting malls and buying branded products satisfy their thirst for better
quality of life. Teenagers do come to show off. Certainly shopping malls are bringing in a
new culture in India which is different from the traditional culture as far as shopping is
concerned.
India offers an immense market opportunity because of increased income and changed
lifestyle of middle class families. In 2001 there were just three malls in India. The number
grew to 343 by 2007. As of May 2013, India had a total of 570 operational malls. As per the
data from Bangalore-based Asipac Consulting, number of malls in 2013 has doubled since
2008.
There are two main formats of mall:Malls
Family Entertainment Centres.
Family Entertainment Centres generally have amusement section, food court, and retail.
How successful are malls in India?

It has been seen that many a time mall is opened with huge expectations but faced shut down.
This includes Full Stop Mall on Palm Beach Road, the Marine Drive of Navi Mumbai, Gold
City Mall in Navi Mumbai, Star City Mall in Delhi and many more. Also in many malls 7080 percent spaces remain vacant. Poor selection of site is one of the major reasons. Experts
advise to do a thorough research before opening a mall in any area. Success actually depends
upon its location, demographic factors, and spending power of the local population.
Some of the largest malls in India are: Phoenix Market City Mumbai (Mumbai, Maharashtra),
Metro Junction Mall (Kalyan, Maharashtra), LuLu International Shopping Mall (Kochi,
Kerala), The Great India Place (Noida) and Z Square shopping Mall (Kanpur, Uttar Pradesh).
All in all malls have changed the lifestyle of consumers in India and helped the retail sector
to become more organized.
3.The Consumer Buying Decision Process
This article is the second in a series of articles about the factors and variables that
influence the behavior of consumers.
The purchase is only the visible part of a more complex decision process created by the
consumer for each buying decision he makes. But what happens before and after this
purchase? What are the factors influencing the choice of product purchased by the consumer?
Today, lets focus on the Consumer Buying Decision Process and the stages that lead a
shopper to purchase a new product.
Engel, Blackwell and Kollat have developed in 1968 a model of consumer buying decision
process in five steps: Problem/need recognition, information search, evaluation of alternatives
to meet this need, purchase decision and post-purchase behavior.
I. Need recognition / Problem recognition :
The need recognition is the first and most important step in the buying process. If there is no
need, there is no purchase. This recognition happens when there is a lag between the
consumers actual situation and the ideal and desired one.
However, not all the needs end up as a buying behavior. It requires that the lag between the
two situations is quite important. But the way (product price, ease of acquisition, etc.) to
obtain this ideal situation has to be perceived as acceptable by the consumer based on the
level of importance he attributes to the need.
For example, you have a pool and you would like someone to take care of regularly cleaning
it instead of you (ideal situation) because it annoys you to do it yourself (actual situation).
But you dont judge the way to reach this ideal situation (pay $250 / month for a
specialized company) as acceptable because its price to obtain it seems too high. Especially
compared to the relatively low level of importance you attach to it. So you wont have a
purchase behavior in this situation.
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On the other hand, the ability to be able to go to your work by car in 20 minutes every
morning (ideal situation) rather than lose three hours in transit because you do not have a car
and you live in the countryside (actual situation) is something that means a lot to you. So you
will have a buying behavior to purchase a car. Even if the price is important.
In addition to a need resulting from a new element, the gap between the actual situation and
the ideal situation may be due to three cases. The current situation has not changed, but the
ideal situation has (a neighbor told you about the possibility that you did not know to
clean the pool by a specialized company). Or, the ideal situation is still the same but its the
actual situation has changed (youre tired of cleaning your pool by yourself). Or finally, the
two situations have changed.
The recognition of a need by a consumer can be caused in different ways. Different
classifications are used:

Internal stimuli (physiological need felt by the individual as hunger or thirst) which
opposes the external stimuli such as exposure to an advertisement, the sight of a
pretty dress in a shop window or the mouth-watering smell of a french pain au
chocolat when passing by a bakery.

Classification by type of needs:

o Functional need: the need is related to a feature or specific functions of the
product or happens to be the answer to a functional problem. Like a computer
with a more powerful video card to be able to play the latest video games or a
washing machine that responds to the need to have clean clothes while
avoiding having to do it by hand or go to the laundromat.
o Social need: the need comes from a desire for integration and belongingness
in the social environment or for social recognition. Like buying a new
fashionable bag to look good at school or choose a luxury car to show that
you are successful in life.
o Need for change: the need has its origin in a desire from the consumer to
change. This may result in the purchase of a new coat or new furniture to
change the decoration of your apartment.

The Maslows hierarchy of needs: Developed by the eponymous psychologist, this is

one the best known and widely used classifications and representations for hierarchy
of needs. It specifies that an individual is guided by certain needs that he wants to
achieve before seeking to focus on the following ones:
o 1. Physiological needs
o 2. Safety needs
o 3. Need of love and belonging
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o 4. Need of esteem (for oneself and from the others)

o 5. Need of self-actualization
II. Information search
Once the need is identified, its time for the consumer to seek information about possible
solutions to the problem. He will search more or less information depending on the
complexity of the choices to be made but also his level of involvement. (Buying pasta
requires little information and involves fewer consumers than buying a car.)
Then the consumer will seek to make his opinion to guide his choice and his decision-making
process with:

Internal information: this information is already present in the consumers memory.

It comes from previous experiences he had with a product or brand and the opinion he
may have of the brand.

Internal information is sufficient for the purchasing of everyday products that the consumer
knows including Fast-Moving Consumer Goods (FMCG) or Consumer Packaged Goods
(CPG). But when it comes to a major purchase with a level of uncertainty or stronger
involvement and the consumer does not have enough information, he must turns to another
source:

External information: This is information on a product or brand received from and

obtained by friends or family, by reviews from other consumers or from the press. Not
to mention, of course, official business sources such as an advertising or a sellers
speech.

During his decision-making process and his Consumer Buying Decision Process, the
consumer will pay more attention to his internal information and the information from
friends, family or other consumers. It will be judged more objective than these from an
advertising, a sellers speech or a commercial brochure of the product.
III. Alternative evaluation
Once the information collected, the consumer will be able to evaluate the different
alternatives that offer to him, evaluate the most suitable to his needs and choose the one he
think its best for him.
In order to do so, he will evaluate their attributes on two aspects. The objective characteristics
(such as the features and functionality of the product) but also subjective (perception
and perceived value of the brand by the consumer or its reputation).
Each consumer does not attribute the same importance to each attribute for his decision and
his Consumer Buying Decision Process. And it varies from one shopper to another. Mr. Smith
may prefer a product for the reputation of the brand X rather than a little more powerful but
less known product. While Mrs. Johnson has a very bad perception of that same brand.
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The consumer will then use the information previously collected and his perception or image
of a brand to establish a set of evaluation criteria, desirable or wanted features, classify the
different products available and evaluate which alternative has the most chance to satisfy
him.
The process will then lead to what is called evoked set. The evoked set (aka
consideration set) is the set of brands or products with a probability of being purchased by
the consumer (because he has a good image of it or the information collected is positive).
On the other hand, inept set is the set of brands or products that have no chance of being
purchased by the shopper (because he has a negative perception or has had a negative buying
experience with the product in the past). While inert set is the set of brands or products for
which the consumer has no specific opinion.
The higher the level of involvement of the consumer and the importance of the purchase are
stronger, the higher the number of solutions the consumer will consider will be important. On
the opposite, the number of considered solutions will be much smaller for an everyday
product or a regular purchase.
IV. Purchase decision
Now that the consumer has evaluated the different solutions and products available for
respond to his need, he will be able to choose the product or brand that seems most
appropriate to his needs. Then proceed to the actual purchase itself.
His decision will depend on the information and the selection made in the previous step based
on the perceived value, products features and capabilities that are important to him.
But his Consumer Buying Decision Process and his decision process may also depend or be
affected by such things as the quality of his shopping experience or of the store (or online
shopping website), the availability of a promotion, a return policy or good terms and
conditions for the sale.
For example, a consumer committed to the idea of buying a stereo of a well-known brand
could change his decision if he has an unpleasant experience with sellers in the store. While a
promotion in a supermarket for a yogurt brand could tip the scale for this brand in the
consumers mind who was hesitating between three brands of his evoked set.
V. Post-purchase behavior
Once the product is purchased and used, the consumer will evaluate the adequacy with his
original needs (those who caused the buying behavior). And whether he has made the right
choice in buying this product or not. He will feel either a sense of satisfaction for the product
(and the choice). Or, on the contrary, a disappointment if the product has fallen far short of
expectations.

An opinion that will influence his future decisions and buying behavior. If the product has
brought satisfaction to the consumer, he will then minimize stages of information search and
alternative evaluation for his next purchases in order to buy the same brand. Which will
produce customer loyalty.
On the other hand, if the experience with the product was average or disappointing, the
consumer is going to repeat the 5 stages of the Consumer Buying Decision Process during his
next purchase but by excluding the brand from his evoked set.
The post-purchase evaluation may have important consequences for a brand. A satisfied
customer is very likely to become a loyal and regular customer. Especially for everyday
purchases with low level of involvement such as Fast-Moving Consumer Goods (FMCG)
or Consumer Packaged Goods (CPG). A loyalty which is a major source of revenue for the
brand when you combine all purchases made by customer throughout his entire life (called
lifetime customer value). The Holy Grail that all brands in the industry are trying to
achieve.
Positive or negative, consumers will also be able to share their opinion on the brand. Whether
in their family or by word-of-mouth.Or on a much broader scale now with social networks or
on consumer product review websites.A tendency not to be overlooked because now with the
Internet, an unhappy customer can have a strong power to harm for a brand.
Thats why thats important for companies to have awareness of that matter. In addition to
optimizing the customer experience, a guarantee (for example, for a washing machine), an
efficient customer service and a specific call center are some of the assets that can be
developed to improve post-purchase behavior if there is any trouble with the product.
An example of Consumer Buying Decision Process
Nothing like a real example to better understand the five stages of the Consumer Buying
Decision Process. Maybe this situation sounds familiar to you.
Stage 1 Need recognition: Its sunday night. Youre hungry (internal physiological stimuli)
and there is nothing in the fridge. You will order food (statement of need).
Stage 2 Information search: You already have ordered to the Indian restaurant in your
street last month (internal information). A friend recommended a pizzeria in your
neighbourhood (external information from environment). And this morning youve found a
flyer for a sushi restaurant in your mailbox (external information from advertising).
Stage 3 Alternative evaluation: You have a bad opinion of the Indian restaurant since
youve been sick the last time (inept set). The pizzeria is both recommended by your friend
and also happens to be a well-known brand (positive perception evoked set). As for the
sushi restaurant, it got good reviews on Tripadvisor (positive perception evoked set).

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Stage 4 Purchase decision: After evaluating the possibilities, youve decided to choose the
well-known pizza delivery chain. In addition, a new episode of your favorite TV show is
broadcasted tonight on TV.
Stage 5 Post-purchase behavior: The pizza was good (positive review). But you know
there was too many calories and you regret a little bit (mixed feelings about yourself). The
next time you will choose the sushi restaurant. There is less fat in sushi than pizza (next
purchase behavior)!
Understand the Consumer Buying Decision Process in order to adapt your marketing
strategy
By improving their knowledge of the Consumer Buying Decision Process, brands can
improve their marketing strategy to effectively respond and be present with their customers at
each stage of their buying behavior. And thus raise and create a need, strengthen their
relationship with their customers and grow their sales.
It always starts with a recognition of a need!
The start of the buying behavior of the consumer is the need recognition. If there is no need,
there is no purchase! Thats why generate or reinforce a need in consumers mind to trigger
the buying behavior has a fundamental importance for brands.
Steve Jobs had become a master in the area with Apple thanks to remarquable marketing
campaigns by successfully creating a need for millions of consumers for products they had
never thought before before. But have finally become an important part of their daily lives.
In a different field, TV infomercials are remarquable examples of how to create an
unexpected need in a consumers mind for a new product. You probably never felt any
difficulty to cook a salad, but while watching the introduction of this great infomercial for
this new kitchen tool, you finally realize the difficulty of the task and the importance of this
new product as a solution to this problem.
Brands must focus on the activation or recall of a need whether physiological, functional,
social or change-related for the consumer through their advertising campaigns. An even
stronger challenge for new products, those with new features or those on new segments that
consumers ignore the need or interest.
Brand awareness for everyday purchases is crucial
For everyday purchases with low level of involvement, consumers will consider only a
limited number of brands when making their choice. Those that come in head first or they
know at least by name. This is called Top-of-mind awareness (TOPA).
For brands of the Fast-Moving Consumer Goods (FMCG) or Consumer Packaged Goods
(CPG) industry, branding and brand awareness can therefore be a real factor of influence of
the consumer buying decision process. Especially for products with a low level of
differentiation.
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Provide concrete information for the alternative evaluation

During the alternative evaluation stage of the Consumer Buying Decision Process,
consumers are looking for solid, reliable and tangible information that will allow them to
make their choice. Especially for purchasing and products with high level of involvement.
The brands interest is to provide concrete information and proof of the product features, its
added value compared to its competitors and how it will respond to their need in order to
provide consumers with the information they need and positive influence in their decision
making process.
Improve the shopping experience and customer relationships
As we saw in previous section, the stage of post-purchase behavior can have important
consequences for a brand. Positively or negatively.
To avoid reputation damage and to develop a lasting relationship with its customers, the
brands interest is to multiply actions for optimizing the shopping experience in-store as well
as the product experience. But also provide great customer service in case of dissatisfaction
or issue with the product.
4.TYPES OF CONSUMER BUYING BEHAVIORS& PRODUCT DECISIONS
Consumers make purchase decisions when they buy small items, such as a cup of coffee, and
when they buy larger items, such as a house. After recognizing a need or a want, consumers
begin searching for products or services that fit their needs. They evaluate their options,
taking note of everything from pricing to a brand's reputation, before marking a purchase.
Four types of consumer buying behavior outline product purchase decisions.
Impulse Purchases
When a consumer stands at the checkout and notices lip moisturizer, magazines and gum, and
adds one of the items to his cart of groceries, it's often referred to as an impulse purchase. The
consumer makes a purchase with little to no thought or planning involved. In most instances
this happens with low-priced items.
Routine Purchases
There are items consumers are used to purchasing every day, once a week or monthly. These
can range from a morning cup of coffee from a nearby convenience store, to milk, eggs and
cheese from the supermarket. Customers spend very little time deciding whether or not to
purchase these items and don't typically need to read reviews or consult with friends for their
opinions before they make routine purchases.
Limited Decision Making
When customers engage in purchases that require limited decision making, they may seek
advice or a suggestion from a friend. For example, if a young professional is preparing for an
interview and wants to get her hair colored the week before, she might solicit advice from
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friends to find out which salon does good hair coloring work. As she shops for a suit for the
interview, she might also ask for suggestions on which store to go to and which brand of suit
is the best. The consumer may research a few options, but the search is not as thorough, or as
time consuming, as with a higher priced item.
Extensive Decision Making
Purchases for high priced electronics, such as a television, computer or camera, or major
purchases such as a home or car require consumers to use extensive decision making.
Consumers spend substantial amounts of time researching a high number of potential options
before they buy. They speak with trusted friends, family, colleagues and sales professionals,
and read reviews and ratings online and in consumer magazines. The decision making
process lasts longer, as the consumer is investing a substantial amount of money.

UNIT 2
1.RETAIL PLANNING
In its broadest sense, the term retail planning can encompass plans for everything from store
location to signage, displays, and consumer traffic patterns in a store. This is achieved by
forecasting a stores sales, by category, and managing the inventory and cash flow needed to
support the sales forecasts.
Why is retail planning important?
The two keys to effective retail planning are forecasting sales and planning inventory needs
to support that level of sales. When actual sales come in over or under the forecast,
appropriate adjustments can be made to how much inventory will be needed in subsequent
planning periods.
Sales forecasting and inventory management, then, work together. You cant plan inventory
levels if you havent developed a sound sales forecast.
With inadequate retail planning, your stores will inevitably be plagued with overstocks and
out-of-stocks. Both situations hurt you financiallythrough markdowns, cash flow
problems, missed sales opportunities, and potentially lost customers. Moreover, reactive
attempts to address out-of-stocks may make matters worse later on with increased overstocks.
Retail Planning Process (4 Steps)
1. Deciding the stores philosophy, mission and objectives,

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2. Situation analysis,
3. Formulation of retail strategy
4. Strategy implementation and control.
1. Deciding the stores philosophy, mission and objectives:
The retail strategic planning process starts with the identification of stores mission for its
existence and hence the scope of the retail store. The mission of a store entails identifying the
goods and services that will be offered to customers. It also deals with the issue that how the
resources and capabilities of a store will be used to provide satisfaction to customers and how
the store can compete in the target market vis-a-vis its competitors.
The mission also involves the way of stores functioning. How a store will work and
accomplish its day to day operations? What is the emergency planning? All are answered in
the stores mission statement. For example, Vishal Mega Marts, they have philosophy of
customer satisfaction through manufacturing to retailing.
This reflects not only the way it tends to treat its customers, but discusses the secret of its
competitive advantage, i.e. the profit saved from absence of intermediaries like agents and
brokers, commission saved is distributed to customers by way of low priced items.
Once the organization mission has been determined, its objectives, desired future positions
that it wishes to reach, should be identified. Stores objectives are defined as ends which the
store seeks to achieve by its USP (Unique Selling Preposition) and operations.

The stores objectives may be classified into two parts:

(i) External store objectives, and
(ii) Internal Store Objectives.
External store objectives are those that define the impact of store on its environment, e.g., to
develop high degree of customer confidence by providing quality goods at lowers prices.
Internal store objectives, on the other hand, are those that define how much is expected to be
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achieved with the available resources, e.g. to raise the store turnover by 15% in the coming
year.
2. Situational Analysis (SWOT Analysis):
The objective of doing stores situation analysis is to determine where the store is at present
and to forecast where it will be if formulated strategies are implemented. The difference
between current and future position (forecasted) is known as planning or strategic gap. Under
organisational analysis, normally stores study their external (environmental) and internal
environments.
External Analysis:
The purpose of examining the stores external environment is to study the opportunities and
threats in the retailing environment. The external analysis studies factors that affect the
macro-environment of retailing industry and the task environment.
Under external analysis, retailer studies these parameters:
(i) Economic environment of retailing,
(ii) Political environment of retailing,
(iii) Legal environment of retailing,
(iv) Socio-cultural environment of retailing,
(v) Technological environment of retailing, and
(vi) International environment of retailing.
The stores task environment can be influenced directly by retailers own policies and
includes competitors, suppliers and customers.
Internal Analysis:
The objective of studying internal environment of its own store is to identify the stores
strengths and weaknesses. The store will try to increase its capabilities, and overcome the
weaknesses that deter the business profit. While doing the internal analysis, store examines

15

the quality and quantity of its available resources and critically analyzes how effective these
resources are used.
These resources for the purpose of examining are normally grouped into human resources,
financial resources, physical resources (assets) and intangible resources (goodwill, image
etc).
The types of questions that are enquired under different resources are:
Human resource:
(a) Is present strength of employees at various levels is sufficient for future action?
(b) Are the employees trained and capable to perform the tasks assigned to them?
(c) Are the employees loyal to store?
(d) Are the employees punctual and regular?
(e) Are the employees skilled in their assigned tasks?
Financial resource:
(a) What is the total cash flow from stores present activities?
(b) What is the ability of retail store to collect money at the time of requirement/ emergency?
(c) How much effective and stable financial policies are?
(d) What is the ratio between fixed and current assets?
(e) What are the contingency plans in case of negative cash flow?
Physical resources:
(a) What is the contribution of fixed assets?
(b) What is the position of abandoned/unused assets?
(c) How effective and update are the stores information systems?

16

Intangible resources:
(a) What is the present capability of the companys management?
(b) How effective is the R & D cell?
(c) How good is the competitors intelligence system?
(d) How effective stores loyalty programmes are?
(e) What is the capability of retail store manager?
(f) Are customers loyal towards companys products?
3. Formulation of Retail Strategy:
In this stage, after analyzing the stores capabilities in terms of HR, finance, physical and
intangible resources, a store manager formulates retail strategy with regard to marketing,
retail positioning and retail mix. Marketing is the way to achieve the set objectives.
Therefore, marketing strategy should be devised according to stores primary and secondary
objectives. Generally, marketing strategy is developed on the basis of product and/or market
segmentation instead of the market as a whole.
Retail Positioning is a plan of stores action for how the retailer will enter the target market
and will compete with its main competitors. Retail positioning from a retail stores point of
view, is a step by step plan to create and maintain a unique and everlasting image of the store
in the consumers mind.
This process reveals the fact that understanding what customer wants? is the success key to
retail positioning in the market. Under retail positioning, a retailer conveys the message that
its products are totally different and as per customers requirement. The reason here is that
customers are attracted towards items that are new for them with the perception that if it is
new, it will have some extra/added features.
Retail positioning is made possible under these circumstances:
(i) By differentiating the stores merchandise from its competitors,
(ii) By offering high level of after sales services at nominal/no cost, and
17

(iii) By adopting low pricing policies.

Retail Mix is the blend of various retail activities which in total present the whole concept of
retailing. The retail marketing and retail positioning strategies are put into effect by this retail
mix the set of controllable elements that a retailer can use to satisfy customers needs and to
influence their buying behavior and compete effectively in the target market. Utmost care is
required on the part of retail manager to select the various elements for a perfect retail mix.
The main elements a retail store manager has to face are:
i. Stores location
ii. Merchandise assortment
iii. Pricing policy
iv. Customer service mechanism
v. Visual merchandising
vi. Personal selling efforts
vii. Advertising efforts and
viii. Stores internal and external environments.
4. Strategy Implementation and Control:
It is concerned with the designing and management of retail systems to achieve the best
possible combination of human, financial, physical and intangible resources of a retail store
to achieve the formulated objectives, without timely and effective implementation also
requires scheduling and coordination of various retail activities. For example, the
coordination between the marketing and sales promotion department is a must for sales
promotion to make success.
Further, the spirit of team work is an essential part for the success of strategy implementation.
If the retail stores strategies are competitive, marketing efforts are as per demand but the
sales promotion employees are not taking it seriously or are ineffective, result will not be up
to the mark.
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The implementation of new retailing strategies sometimes require changes in the way of
functioning and duties that can lead to resistance from employees. Therefore, stores should
take positive steps to reduce this resistance to change and to convince the employees that it in
a long term will be beneficial for both the store and employees.
The positive steps include the following:
(i) Inspection,
(ii) Detection, and
(iii) Correction.
It means after implementing the retail strategies, retailer should assess how effectively
strategies are being implemented, how far the strategic objectives are being achieved and
what has been left to be achieved in the stores objectives list. Therefore, retailers inspect the
implemented strategies from time to time and detect the fault (if any) in the implementation
of various retail elements. If any deficiency is found during inspection process, that has to be
corrected with immediate effect without any further loss to store.
STRATEGY, STRUCTURE & PLANNING
Establish new strategic approaches or improve your current strategies.
We can help ensure that your strategy, structure and processes are aligned for optimal
effectiveness and efficiency. We can help you ensure that you have the right processes in
place to achieve your goals and objectives. And we can help you develop an organization
structure that will maximize your results and help you develop effective route-to-market
plans for your customers and channels.
Our Strategy, Structure & Planning services include:

Go to Market Planning Well work with you to establish a Go-to-Market approach

based on the questions you need to need to ask:
o What are my core/focus products/SKUs?
o How do I attack my various customer segments?
o How do I execute marketing plans across my customer base?

Organization Structure Design Developing the optimal organization involves

19

more than simply creating new organization charts. Our approach ensures that the
structure aligns with your strategy and incorporates all of the factors that affect your
organizations performance (process, staffing, reporting, compensation, training,
systems, etc.). Also, we help you develop an implementation plan to address the
details of organizational change.

Channel & Customer Development Our approach defines customer relationships

and the series of touchpoints (business process interactions) that make up the
typical manufacturer/customer relationship. Using a proprietary model, we can assist
you in mapping your business processes and assessing their effectiveness. We also
conduct Customer Satisfaction Studies and use the results to help you develop an
effective CRM Strategy.

Process Engineering Good process usually drives good results. Some companies
have disappointing results because their underlying business processes are inefficient
or broken. How well do your processes work? The only way to know for sure is to
map them, identify issues, and find ways to improve and/or simplify the processes.

Customer Segmentation One size does not fit all; your marketplace programs need
to be tailored to the needs of different customers. Working with you to understand
your customers and their challenges, we can create relevant customer segments and
develop approaches and programs that target them.

Organization Development The overall effectiveness of your organization is

determined by a broad range of factors, including: Goals/Objectives/Strategy,
Processes, Structure/Staffing/Compensation and Systems/Tools. We use our
Organization Development model to evaluate these key drivers, assess their impact on
your effectiveness and ensure that they are all working in sync.

Change Management Change Management is an essential element in planning any

organizational transformation (new structure, tools or programs) to ensure that the
organization continues to perform and deliver business results during the planning,
implementation and post-transformation timeframes. Working together with you, we
can develop an approach that ensures not only that change happens but that it is
embraced and effectively implemented.

UNIT 3
1.RETAIL TRADE AREA ANALYSIS: CONCEPTS AND NEW APPROACHES
Choosing a retail site in the absence of sound trade area analysis is a lot like flying an
airplane with blinders: It forces a business to commit itself to a course in the absence of vital
information such as store patronage, local market opportunities, competing businesses, and
barriers that would dissuade consumers from visiting the site.
Geographic Information System technology is a fundamental tool for analyzing retail trade
areas today. This technology removes site selection "blinders" because it identifies and
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illustrates the crucial factors for site selection within a geographic framework.
Essentially, trade area analysis is a methodology, process or technique that provides a basis
for understanding, visualizing and quantifying the extent and characteristics of known or
approximated trade areas.
Trade area analysis provides the foundation for:
Understanding the geographic extent and characteristics of store patronage.
Spatially assessing performance.
Performing competitive analysis.
Evaluating market penetration and market gap analysis.
Target marketing.
Merchandising.
Identifying/quantifying effects of cannibalization.
Developing and exploiting demographic profiles.
Site suitability and site selection studies.
Trade area analysis also employs theoretical techniques that are used to approximate the
potential patronage area. These techniques are used in cases where customer level data is not
available. Three types of theoretical approaches are commonly employed in trade area
analysis, including:
Radial (ring) studies
Gravity models
Drive time analyses
Radial Studies:
Radial or ring based analysis is performed by selecting and evaluating demographic
variables that fall within a pre-defined distance from a store location. This technique
assumes that the trade area is circular, with the store at its center. Ring analysis does not
account for barriers such as rivers or railroad tracks that may cross through a trade area and
restrict access to a retail site. Consequently, radial studies are a simplistic approach that can
result in an incorrect delineation of the trade area and errors of omission or commission.

Figure 1. Location of store, showing 1, 3, and 5 mile radii. The dots indicate the locations of
demographic samples. Red colored dots fall within the 5-mile radius. Note that samples
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located across the river would be included in the 5-mile demographic summaries for this
site.
Gravity Models:
Gravity models, or spatial interaction models, define a trade area based on its attractiveness
relative to other trade areas. These models provide an approximation of store trade area by
putting the distribution of all locations (including competitors) into a geographical context
and evaluating each location's relative attractiveness. Typically, a distance decay curve is
used to model the spatial interaction of individual locations. Often size of the store, or store
sales if available, is used to drive the attractiveness parameter.
Gravity models are more sophisticated than simple radial approximations, but they still do
not account for logistical barriers and they are limited by the availability and accuracy of
competitor data. Moreover, gravity models basically are sophisticated algorithms, which
may not be appropriate for non-technical analysts.

Figure 2a. Gravity based patronage probability model showing the theoretical store trade
area. The blue green yellow red progression represents zones of increasing patronage
probability.

Figure 2b. Gravity based patronage probability model showing the locations of demographic
sample sites. Blue colored dots fall within the patronage probability zones. Green colored
dots indicate the locations of sample sites that fall within the 5-mile radius but are not within
22

the patronage probability zones.

Drive Time Analyses:
Recently, GIS based tools for modeling the drive time or drive distance from a location have
become available. These tools use digitized roadway systems that indicate the type of road
such as a city street or a divided highway. Speed limits are assigned based on the type of
road, the mode of transportation (car, truck, motorcycle, etc.), congestion parameters, and
the time of day. These parameters are used to dictate the ease of traveling along road
segments. Through this process, a polygon is generated to represent the extent to which a
vehicle can travel outward from the site in all directions along the existing roadway system.
Unlike the radial distance or gravity model-based trade area approximations, GIS based
drive time analyses account for logistical barriers.
Drive time analyses are generally considered to be valid for convenience store scenarios,
where patrons are expected to go to the closest or most logistically convenient location.
Since this analysis is governed by the presence of properly located and attributed roadway
systems, the accuracy of the drive time analysis can be limited by the availability of accurate
and up-to-date digitized road data.

Figure 3a. Drive time analysis showing areas that can be reached within 5, 10 and 15-minute
drive times.

Figure 3b. Drive time analysis showing the location of demographic samples. The blue
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colored dots represent the demographic sample sites that fall within a 10-minute drive time.
Green colored dots represent demographic sample sites that fall within the 5-mile radius, but
fall outside of the 10-minute drive time polygon. Conversely, red colored dots that fall
within the 15-minute drive time polygon represent demographics that would not be included
using a traditional 5-mile radius approach.
Customer Level Data Drives Radial Filter Analysis Technique
The recent availability in-house customer-level, point-of-sale data is creating new ways for
retail organizations to explore and evaluate the spatial characteristics of their customer base
and the marketplace. Customer point-of-sale data is collected via in store surveys, courtesy
card programs, license plate surveys, credit card transactions or through raffles or business
card collections. Typical point-of-sale data contains a record of what was purchased, when it
was purchased, where it was purchased and the name and address of the purchaser. This
address-based data can be geocoded to provide a geographically referenced position for each
customer.
Historically, analysts were forced to take address-level data and aggregate it into existing
postal or census boundaries in order to summarize and map customer counts or revenue. In
many cases, this level of aggregation would "smooth out" or homogenize important subtle
variations in the geographic distribution and characteristics of a trade area. This is
particularly troublesome in cases where the trade area is small and clustered around an area
near the store, as is the case in most convenience stores.
In order to alleviate this limitation, leading GIS companies use a radial filter-based trend
surface modeling application that analyzes trade areas directly from customer level point-ofsale data. This type of analysis provides a very accurate and precise measure of the spatial
distribution and characteristics of store trade areas. Moreover, because customer-level point
of sale data is used, the effects of logistical barriers are automatically accounted for.

Figure 4. Map showing the location of customers.

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Figure 5. Color thematic trade area map showing concentration of revenue. This map was
produced by summarizing the customer revenue data according to the block groups within
which the customer locations fall. Colors ranging from blue green yellow red represent
the progression from low to high revenue.

Figure 6a. Revenue based trade area map produced using radial filter based application.
Colors ranging from blue green yellow red represent the progression from low to high
revenue. This analysis clearly shows discrete pockets of customer/revenue strength. Note
how the hotspots identified using radial filter analysis are small and discrete, and are not
constrained by pre-existing census geographic boundaries.

Figure 6b. Radial Filter trade area map showing the location of demographic sample sites.
Note that blue colored dots represent demographic sample sites that fall within the actual
25

store trade area. Green colored dots represent those demographic samples that fall within a
5-mile radius, but do not fall with the stores trade area.
2.STORE EVALUATION
The Shopper's Store Rating Checklist
Often without realizing it, shoppers are evaluating and rating every store they enter. Here are
25 items that studies have shown to be of importance to shoppers.
Few of these are matters that shoppers would ever mention to you. Instead, they just mention
it to their friends! (Or, post it on Yelp.) Then they vote with their wallets. And their feet.
To keep the customers coming into your store, one place to start is to see your store the way
they do. Start today. Take a fresh look at your own store. Using these explanations, enter a
grade of 1 (disappointing) to 4 (outstanding!) for each item on the Store Rater.
Accessibility: How easy is it to get to your store?
You need to make it as easy as possible for shoppers to get to your store. If your store is in an
odd location, publish directions in your advertising and make sure your staff is prepared to
provide clear directions over the phone.
Advertising: Do you have an in-store link to your outside advertising?
Its amazing how many stores spend a bundle on advertising, while neglecting to "connect the
dots" between their ads and their store. One easy way to do this is to display your ads on a
sign board at the front of the shop. Use your logo in advertising, and as a consistent presence
in your shop. Spotlight the items featured in your ad with special displays or signage. Be
consistent with your advertising, so customers will come to recognize your advertising style.
Basics: Are your shelves stocked with basics?
Be sure always to stock the basics. Rain checks are no longer an acceptable replacement for
out-of-stock items. You want the people who stop in for a quick purchase to return to your
storedont turn them away with under-stocked shelves.
Bathrooms: Sigh. This really does matter!
Are your bathrooms clean? Bathrooms are an important part of customer service. Do you
keep them clean and well-lit? Are paper towels, soap, etc. always available? Do you have an
employee frequently inspect them to assure they are well-maintained?
Cash/Wrap: Is your cash/wrap counter organized and free of clutter?
The cash/wrap is your customers last impression of your store. Keep it neat and
representative of your stores dedication to service and organization. Be mindful of open
storage shelves that often become a haven for clutter. Keep office supplies neat and
organized.
Cleanliness: Is your store clean?
Cleanliness should start in the parking lot, continue through your entrance and carry
throughout your entire store. Remember that tidiness is an important indication of your store
26

pride. Make cleaning and tidying your shop a daily activity.

Competitive (But Practical) Prices: Is your merchandise priced appropriately?
Studies show that 20 percent of customers are true price hounds and will chase down the
lowest price. The other 80 percent care about price, but also take into consideration what else
the store has to offer. When pricing merchandise, dont be distracted by the 20% who are
price-hounds and lose sight of the 80% who are looking for total value. Keep your prices
competitive, but dont lock yourself into a habit of hasty discounting in order to chase fickle
price shoppers.
Customer Mailing List: Do you ask customers if theyd like to enter their e-mail address on
a mailing list?
Dont underestimate the importance of regular correspondence with customers. Its not
enough just to have a mailing listyou must continually use this resource and update it,
providing your customers with meaningful information. At the cash/wrap, ask customers if
theyre interested in joining your mailing list if they havent already.
Displays: Are they timely? Are they fun? Are they constantly changing?
If a display seems to be turning slowly and not generating a lot of interest, consider making
some changes. Use creative signage to add interest, replace it with another display, couple it
with faster turning products or move it to a different part of the store. Just make sure its eyecatching.
Fixtures: Do the fixtures showcase the merchandise?
The best fixtures highlight merchandise in a discreet way. Choose fixtures that are practical
and durable, but wont draw the attention away from the products with gimmicky colors or
design.
Flooring: Does your floor help to guide customers through your store?
As flooring options become increasingly affordable, its easy for you to take full advantage of
different flooring throughout your shop. Use hard surfaces in high-traffic areas and carpeting
to add class to specific areas.
In-Store Graphics and Signage: Are your graphics and signs clear? Are they colorful? Do
they have a theme?
Graphics and signage should never detract from or compete with the merchandise. Their goal
should simply be to draw attention to various products, discounts and special offers. Make
sure your signage communicates its message immediately. Customers wont read a sign if
they have to take the time to figure out its message.
Lighting: Is it appropriate for the merchandise? For the stores image?
More than any other variable in retailing today, lighting can create or destroy a stores
competitive edge. Featured products should be highlighted to attract customer attention. Keep
your store bright and airy, and make sure all areas are adequately lityou dont want any
dark corners.
Location: Is your store in an appropriate location?
The three keys to success were once considered to be location, location and location. Today,
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location is only one consideration of manybut its still extremely important. Stores need to
be located where the customers are, where they want to be, or where theyre willing to go.
Make sure your shops location isnt working against you.
Merchandise Mix: Is it clear who the right customer is?
At a glance, customers should know who the store is intending to attract: teenagers? working
moms? young families? empty nesters? As you look at the merchandise assortment, do you
get a sense of who the customer is?
Merchandise Selection: Is your product selection too broad?
Its important to focus your product selection around customer needsbut many stores have
a selection thats far too broad. These retailers try too hard to be all things to all people and
dont concentrate enough on the customers they may really want or need to attract. Carry
what your customers want, but dont spread yourself too thin.
Music: Is there music playing? If so, is it being played for the customersor for the staff?
Music is a great way to create an inviting atmosphere in your store. But be carefulmusic
should always be selected to appeal to the customer, not the staff. Also, keep the music
volume lowit should never intrude on conversation.
Name: Does your stores name indicate what it sells?
Many retailers choose names that convey something about themselves rather than the store.
These same retailers end up spending a lot of money later trying to inform customers about
what kind of store they are and what products they offer. If your stores name itself doesnt
identify your retail segment, consider adding a tagline. When customers hear your stores
name, you want them to immediately think of what youre selling.
Parking: Is your parking lot clean and safe?
If your stores parking area isnt clean, safe and clearly marked, you may inadvertently
discourage business. Consider the practicality of your parking lot for shoppers coming at
night or in bad weather.
Quality: Is the value of your merchandise evident?
Never just assume that customers will be familiar with the quality of your merchandise. Post
product guarantees at the cash/wrap or on your displays. Display quality assurances on hang
tags. Learn about the products you sell, and use this information on the sales floor.
Smell: What does your store smell like?
Dont ignore the role of scent in projecting an image. Think of how many stores youve
entered that had unpleasant odors, or pleasant ones that were too strong. Remember how
quickly you walked right back out? The first step to keeping your store free of offensive
smells is to discover what it presently smells like. You may need to enlist a candid friend for
this project, someone who is not in the store every day who actually can notice its fragrance.
Then, decide what mild fragrance would enhance the atmosphere you are creating in your
store.
Special Services: What kinds of extras does your store provide?
Many retailers provide special services but fail to communicate this to their customers. If you
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provide an extra service, make sure your customers know about it. Make signs and mention
these services in your advertising.
Store Image: What is your stores personality?
This is where the theatre of retail really comes into play. Is there a match between the look
of your store, your merchandise mix, the music, the lighting, the signage and graphics: do all
of these elements combine to tell your story to your very best customers? Is your store the
one where they want to see and be seen?
Storefront: Is your storefront pleasant and appealing?
Always keep in mind that your storefront is the first impression your customers have of your
store. Dated or hastily assembled displays, unkempt signs and dirty windows are inexcusable.
These sorts of things do injustice to all the hard work that may have gone on inside the store.
Make sure your storefront is inviting and pleasing to customers.
Windows: Are they compelling and inviting?
Are your windows clean and appropriately lit? Spotlights on window displays should be near
the glass and angled onto the display. Some stores have window lighting that is set in on top
of the display, casting unintentional shadows. How are yours?
3.STORE DESIGN AND LAYOUT - DIFFERENT FLOOR PLANS AND LAYOUTS
Opening a retail store is no joke and requires meticulous planning and detailed knowledge.
Location
Make sure your store is in a prime location and is easily accessible to the end-users. Do not
open a store at a secluded place.
Floor Plan
The retailer must plan out each and everything well, the location of the shelves or racks to
display the merchandise, the position of the mannequins or the cash counter and so on.
1. Straight Floor Plan
The straight floor plan makes optimum use of the walls, and utilizes the space in the
most judicious manner. The straight floor plan creates spaces within the retail store for
the customers to move and shop freely. It is one of the commonly implemented store
designs.

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2. Diagonal Floor Plan

According to the diagonal floor plan, the shelves or racks are kept diagonal to each
other for the owner or the store manager to have a watch on the customers. Diagonal
floor plan works well in stores where customers have the liberty to walk in and pick
up merchandise on their own.

3. Angular Floor Plan

The fixtures and walls are given a curved look to add to the style of the store. Angular
floor plan gives a more sophisticated look to the store. Such layouts are often seen in
high end stores.

4. Geometric Floor Plan

The racks and fixtures are given a geometric shape in such a floor plan. The geometric
floor plan gives a trendy and unique look to the store.

5. Mixed Floor Plan

The mixed floor plan takes into consideration angular, diagonal and straight layout to
give rise to the most functional store lay out.

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Tips for Store Design and Layout

The signage displaying the name and logo of the store must be installed at a place
where it is visible to all, even from a distance. Dont add too much information.

The store must offer a positive ambience to the customers. The customers must leave
the store with a smile.

Make sure the mannequins are according to the target market and display the latest
trends. The clothes should look fitted on the dummies without using unnecessary pins.
The position of the dummies must be changed from time to time to avoid monotony.

The trial rooms should have mirrors and must be kept clean. Do not dump
unnecessary boxes or hangers in the dressing room.

The retailer must choose the right colour for the walls to set the mood of the
customers. Prefer light and subtle shades.

The fixtures or furniture should not act as an object of obstacle. Dont unnecessary
add too many types of furniture at your store.

The merchandise should be well arranged and organized on the racks assigned for
them. The shelves must carry necessary labels for the customers to easily locate the
products they need. Make sure the products do not fall off the shelves.

Never play loud music at the store.

The store should be adequately lit so that the products are easily visible to the
customers. Replace burned out lights immediately.

The floor tiles, ceilings, carpet and the racks should be kept clean and stain free.

There should be no bad odour at the store as it irritates the customers.

Do not stock anything at the entrance or exit of the store to block the way of the
customers. The customers should be able to move freely in the store.

The retailer must plan his store in a way which minimizes theft or shop lifting.

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i.

Merchandise should never be displayed at the entrance or exit of the store.

ii.

Expensive products like watches, jewellery, precious stones, mobile handsets

and so on must be kept in locked cabinets.

iii.

Install cameras, CCTVs to have a closed look on the customers.

iv.

Instruct the store manager or the sales representatives to try and assist all the
customers who come for shopping.

v.

Ask the customers to deposit their carry bags at the entrance itself.

vi.

Do not allow the customers to carry more than three dresses at one time to the
trial room.

4.FACTORS INFLUENCING PRICING DECISIONS: INTERNAL AND EXTERNAL

FACTORS
The influencing factors for a price decision can be divided into two groups:
(A) Internal Factors and
(B) External Factors.

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(A) Internal Factors:

1. Organisational Factors:
Pricing decisions occur on two levels in the organisation. Over-all price strategy is dealt with
by top executives. They determine the basic ranges that the product falls into in terms of
market segments. The actual mechanics of pricing are dealt with at lower levels in the firm
and focus on individual product strategies. Usually, some combination of production and
marketing specialists are involved in choosing the price.

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2. Marketing Mix:
Marketing experts view price as only one of the many important elements of the marketing
mix. A shift in any one of the elements has an immediate effect on the other three
Production, Promotion and Distribution. In some industries, a firm may use price reduction as
a marketing technique.
Other firms may raise prices as a deliberate strategy to build a high-prestige product line. In
either case, the effort will not succeed unless the price change is combined with a total
marketing strategy that supports it. A firm that raises its prices may add a more impressive
looking package and may begin a new advertising campaign.
3. Product Differentiation:
The price of the product also depends upon the characteristics of the product. In order to
attract the customers, different characteristics are added to the product, such as quality, size,
colour, attractive package, alternative uses etc. Generally, customers pay more prices for the
product which is of the new style, fashion, better package etc.
4. Cost of the Product:
Cost and price of a product are closely related. The most important factor is the cost of
production. In deciding to market a product, a firm may try to decide what prices are realistic,
considering current demand and competition in the market. The product ultimately goes to
the public and their capacity to pay will fix the cost, otherwise product would be flapped in
the market.
5. Objectives of the Firm:
A firm may have various objectives and pricing contributes its share in achieving such goals.
Firms may pursue a variety of value-oriented objectives, such as maximizing sales revenue,
maximizing market share, maximizing customer volume, minimizing customer volume,
maintaining an image, maintaining stable price etc. Pricing policy should be established only
after proper considerations of the objectives of the firm.
(B) External Factors:
1. Demand:
The market demand for a product or service obviously has a big impact on pricing. Since
demand is affected by factors like, number and size of competitors, the prospective buyers,
34

their capacity and willingness to pay, their preference etc. are taken into account while fixing
the price.
A firm can determine the expected price in a few test-markets by trying different prices in
different markets and comparing the results with a controlled market in which price is not
altered. If the demand of the product is inelastic, high prices may be fixed. On the other hand,
if demand is elastic, the firm should not fix high prices, rather it should fix lower prices than
that of the competitors.
2. Competition:
Competitive conditions affect the pricing decisions. Competition is a crucial factor in price
determination. A firm can fix the price equal to or lower than that of the competitors,
provided the quality of product, in no case, be lower than that of the competitors.
3. Suppliers:
Suppliers of raw materials and other goods can have a significant effect on the price of a
product. If the price of cotton goes up, the increase is passed on by suppliers to
manufacturers. Manufacturers, in turn, pass it on to consumers.
Sometimes, however, when a manufacturer appears to be making large profits on a particular
product, suppliers will attempt to make profits by charging more for their supplies. In other
words, the price of a finished product is intimately linked up with the price of the raw
materials. Scarcity or abundance of the raw materials also determines pricing.
4. Economic Conditions:
The inflationary or deflationary tendency affects pricing. In recession period, the prices are
reduced to a sizeable extent to maintain the level of turnover. On the other hand, the prices
are increased in boom period to cover the increasing cost of production and distribution. To
meet the changes in demand, price etc.
Several pricing decisions are available:
(a) Prices can be boosted to protect profits against rising cost,
(b) Price protection systems can be developed to link the price on delivery to current costs,
(c) Emphasis can be shifted from sales volume to profit margin and cost reduction etc.
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5. Buyers:
The various consumers and businesses that buy a companys products or services may have
an influence in the pricing decision. Their nature and behaviour for the purchase of a
particular product, brand or service etc. affect pricing when their number is large.
6. Government:
Price discretion is also affected by the price-control by the government through enactment of
legislation, when it is thought proper to arrest the inflationary trend in prices of certain
products. The prices cannot be fixed higher, as government keeps a close watch on pricing in
the private sector. The marketers obviously can exercise substantial control over the internal
factors, while they have little, if any, control over the external ones.
UNIT 4
1.RELATIONSHIP MARKETING IN RETAILING:
Relationship marketing is a facet of customer relationship management (CRM) that focuses
on customer loyalty and long-term customer engagement rather than shorter-term goals like
customer acquisition and individual sales. The goal of relationship marketing (or customer
relationship marketing) is to create strong, even emotional, customer connections to a brand
that can lead to ongoing business, free word-of-mouth promotion and information from
customers that can generate leads.
Relationship marketing stands in contrast to the more traditional transactional
marketingapproach, which focuses on increasing the number of individual sales. In the
transactional model, the return on customer acquisition costmay be insufficient. A customer
may be convinced to select that brand one time, but without a strong relationship marketing
strategy, the customer may not come back to that brand in the future. While organizations
combine elements of both relationship and transactional marketing, customer relationship
marketing is starting to play a more important role for many companies.

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Implementing a relationship marketing strategy

Relationship marketing is based on the tenets of customer experience management(CEM),
which focuses on improving customer interactions to foster better brand loyalty. While these
interactions can still occur in person or over the phone, much of relationship marketing and
CEM has taken to the Web
With the abundance of information on the Web and flourishing use of social media, most
consumers expect to have easy, tailored access to details about a brand and even expect the
opportunity to influence products and services via social media posts and online reviews.
Today, relationship marketing involves creating easy two-way communication between
customers and the business, tracking customer activities and providing tailored information to
customers based on those activities.

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For example, an e-commerce site might track a customer's activity by allowing them to create
a user profile so that their information is conveniently saved for future visits, and so that the
site can push more tailored information to them next time. Site visitors might also be able to
sign in through Facebook or another social media channel, allowing them a simpler user
experience and automatically connecting them to the brand's social media presence.
This is where CRM and marketing automation software can support a relationship marketing
strategy by making it easier to record, track and act on customer information. Social CRM
tools go further by helping to extend relationship marketing into the social media sphere,
allowing companies to more easily monitor and respond to customer issues on social media
channels, which in turn helps maintain a better brand image.
2.HR ISSUES
High Turnover
Retail is notorious for having a high rate of employee turnover. This means employees
routinely come and go, which poses several challenges. Training and developing are difficult,
time consuming and constant if you constantly have to recruit and hire new people. It's also
more difficult to build customer loyalty if customers keep seeing a new face every time they
enter your store. You can address these problems by recruiting the right people and building a
rapport with your employees. When you interview people, make sure you ask specific
questions that relate to the type of work your employees do. Informal social outings and fun
games at work can help build rapport.
Diversity
A diverse workforce is typically regarded as a good thing. It helps a retailer better connect
with its marketplace and usually leads to more and better ideas and results. However, a staff
of people from widely varying demographic backgrounds might have trouble developing
cohesiveness. From an HR vantage point, your challenge is to manage diversity to avoid
major conflicts and promote a spirit of tolerance, teamwork and collaboration. Include
diversity discussions in store meetings and encourage employees to discuss their differences.
These techniques can go a long way toward building a more cohesive team.
Misconceptions
To build a staff of competent, committed and motivated employees, retailers must overcome a
number of common challenges and misconceptions about the work environment. Common
concerns include long hours, no full-time jobs or benefits, low pay and no growth
opportunities. You can overcome these challenges by going against the industry grain. Offer
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regular eight-hour work shifts at your retail business. Provide competitive pay and benefits to
full-time employees. Even if your starting pay is modest, do your best to offer fast tracks to
higher salaries and management positions when an employee has established a good track
record with your business.
Seasonal Demand
Retailers often experience seasonal demand fluctuations. The holiday buying season, from
"Black Friday" through Christmas, is well-known as the busiest shopping season of the year.
Retailers often try to add temporary staff during these times. They often wind up with fewer
skilled and trained workers who might not have the tools to best serve your customers. These
workers can also alienate regular staff that must pick up the slack. Develop a plan to
assimilate temporary workers during these seasonal periods. A store meeting at the start of the
busy season is a good way to help temporary workers learn the system and get to know the
regular staff.
UNIT 5
1.FACTORS TO BE CONSIDERED IN HAVING WEBSITE:
From functionality and appearance to navigation and coding integrity, a lot goes into creating
an eye-catching, user-friendly website. It doesnt end there, either. Web developers and
designers must work together to produce websites that will be located by search engines,
engage customers, and stimulate conversions. Whew! Thats a lot of pressure. Fortunately, the
following 24 tips will guide you through the process of creating a unique user experience that
inspires viewers to become loyal brand advocates.
1. Choosing a Domain and Host
Great domain names (take a look at Google and Yahoo, for two) say so much while saying so
little. In addition to being memorable, a domain name needs to accurately reflect your brands
voice and be nearly impossible to misspell. Finding the right name for your brand is crucial,
because incorporating a combination of SEO, simple spelling, and brand identity into the
domain name leads to a higher chance of being located in search engine results. Simply put,
businesses that are easily accessed online get more customers.
When comparing hosting packages, its vital to consider the nature of your website and
business. Will the website be media-rich, with loads of pictures, videos, and presentations?
Do you have technical support in-house, or do you need reliable, responsive support from
your hosting provider? Also think about the amount of traffic your website will receive. Does
the hosting company offer scalable solutions? What backup, security, and additional features
are offered? Dont forget to research reviews about the companys performance on social
media and third party websites before making a final decision.
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2. Backend Services (CMS Content Management System / Software)

Its impossible to develop a great website without a functional program taking care of the
backend. If you think of your website as a car, you can understand why. When friends see
your shiny new sports car, they look at the sleek paint job, glistening tires, and luxurious
leather seating. In the world of websites, this equates to the part of your site a user
experiences directly. Just like the powerful engine in your sports car, the backend of your
website is where the magic really happens. Without strong backend services, your website
wont be able to wow your guests. Similarly, a sports car without an engine is rendered
useless. One of the best engines for ecommerce sites is Magento, while WordPress is a
customizable CMS ideal for informational sites.
3. Clean Design
One of the most important things to remember during the process of website development is
to create a clean, appealing design. A quality design is attractive and easy to read with
intuitive navigation. Most importantly, a clean design helps viewers focus on the value of
your brand and content instead of distracting graphics and large amounts of text. Often,
customers associate website designs with the quality of a particular company or product.
Hence, a clean design is vital to providing a positive user experience that encourages
customers to return.
4. Effective Color Scheme
Color schemes are more important than customers realize. Different colors have the ability to
evoke emotional responses, such as calm, happiness, or frustration. When it comes to using
colors in your website design, its essential to consider your companys niche, target
audience, branding, and the elements of color theory. What colors will your target audience
respond to? If your color scheme is similar to your logo and branding, is it overwhelming or
pleasing to look at? Are you trying to convey your brands voice with a bright and spunky
orange or a professional, calming blue? Regardless of your choice, spending the time to
research the best color options will give your visitors a good impression.
5. Branding
Branding is important to all businesses, both large and small. The design and placement of
your brands logo contributes to a viewers overall opinion. Professionally designed logos
successfully catch the customers eye and provide a clear picture of the brands unique voice.
Choose a location on your site that is readily visible to visitors, such as the upper left corner,
since this is where the eye naturally begins to scan a website. To further solidify your brands
identity, consider using the same logo on packaging, print advertising, and branded apparel.
When a business is consistent with branding, it provides customers with an integrated and
memorable brand experience.
6. Functionality
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When thinking about functionality, there are a few matters to consider. Namely, is the website
functional in the literal sense? Are there loading issues or broken links? Are the sites security
features adequate for your businesss needs? In addition to these operational issues, its
crucial to view your websites features from the users perspective. Are the contact forms,
surveys, and customer feedback sections of your site working properly? One or all of these
functional issues can prompt a customer to leave your site.
7. Navigation
If a website is confusing and difficult to navigate, your customers may leave and never return.
To increase the efficiency and appeal of your sites navigation, conduct an in-depth site
review as if you are a new visitor. Note the navigation streams that make sense and those that
do not. One way to improve a visitors ability to navigate your site easily (and help search
engines crawl your site) is to add a site map. Furthermore, streamlining navigation by
eliminating unnecessary or underperforming pages may decrease load time while improving
the quality of your brands online presence.
8. Usability
Websites that are easy to use are more likely to garner customer interest and encourage
business. Usability can be increased by displaying product and service information in a clear,
concise manner. Make sure your website has all the features a customer would need for the
site to be easily accessible. If a viewer is reading your blog and wants to subscribe to an
email newsletter, do they have to hunt for the opt-in form? Is your contact information clearly
displayed? Does the layout of your website encourage social sharing and further interaction
with your brand? These key elements are essential to review when optimizing the usability of
your site.
9. Call to Action
Placing calls to action on your website encourages customers to contact your business. A
friendly suggestion, such as Contact us today! demonstrates that your business wants to
develop a relationship with its customers. Its important that calls to action are appropriate for
a visitors level of engagement with your company. If theyre just discovering your brand,
invite them to subscribe to your email newsletter. If theyre already a loyal customer, perhaps
theyll enjoy participating in your brands loyalty rewards program. Regardless of what
youre asking visitors to do at your site, always include a call to action at least once on each
page.
10. Short Loading Times
When looking for information online, nothing aggravates visitors more than slow loading
times. Customers can be turned away completely due to this issue. Testing your website
ahead of time will help you pinpoint any loading time issues, and these can be fixed before
your sites official release. To increase customer retention and provide a positive user
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experience, periodically evaluate your websites loading time once it has launched. Short load
times give customers the information they want when they want it. If your site cant deliver, a
competitors site will.
11. Active Blog
An on-site blog helps keep customers informed about the latest products, company events,
and industry-related information. Featuring a blog on your website is a great way to connect
with them, especially if your posts encourage readers to interact with your brand. Keeping
your blog regularly updated informs customers of your brands values and desire to promote
communication. By regularly providing readers with fresh, helpful, engaging content, your
brand becomes a trusted resource and an industry authority.
12. Clean, SEO-Friendly Code
Whether youre developing new webpages or optimizing existing ones, its critical to have
clean, SEO-friendly code. By taking the time to improve your sites code, you can increase
the overall return on investment. SEO-friendly code acts as a guide for search engine spiders
by providing a clear picture of your sites content. Certain CMS services, such as WordPress,
provide plug-ins designed to simplify the process of cleaning up code and increasing search
engine rankings. Since it requires little coding knowledge (if any), WordPress is a great
resource for companies struggling to drive traffic to their websites.
13. Compatibility with Multiple Browsers
As technology progresses, the number of internet browsers is steadily growing. From Internet
Explorer and Chrome to Firefox and Safari, it can be frustrating to keep up with them all.
When creating a website, its vital to ensure that your website is reachable from multiple
browsers. Specifically, your site should load properly on all major browsers including older
versions. Failing to take this step may exclude a large section of your customer base, which
can be a costly consequence for a growing business.
14. Mobile Sites vs. Responsive Sites
Statistics indicate that the use of mobile devices to conduct online searches has increased
significantly in the past two years. In fact, approximately 95% of mobile device users count
on their devices to search for local products and services. To effectively reach this growing
population of mobile users, businesses need to be sure that their websites are available from
any device. For a large company with an existing web presence, it makes sense to develop a
separate, mobile-friendly website designed to perform well on any device. On the other hand,
a business planning the launch of a website would be better served by choosing a responsive
design capable of adapting to any device.
15. Integration with Social Media

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Integration with social media is no longer a novelty its a requirement. As technology

makes information sharing more convenient, businesses lacking social media integration fail
to take advantage of what has been likened to modern day word-of-mouth advertising. Social
media provides a venue in which customers can promote your brand, provide reviews, and
stay in-the-know about your companys latest news. Written and visual content, including
product images and branded video, are easily distributed on platforms like Facebook, Twitter,
Pinterest, and LinkedIn with the addition of social sharing buttons on your website.
16. Captcha Tests
Spam, spam, and more spam. Thats what some businesses receive in their comment sections,
contact forms, and site forums that dont have captcha tests in place. These tests (youll
recognize them as the random letters and numbers typed before submitting a web-based
form) differentiate humans from robots. Adding these short tests to your contact forms will
ensure that only humans are able to use your sites resources saving your business time and
money.
17. Effective Security
With the evolution of technology, newer and more advanced security risks threaten to
compromise your websites integrity. From malware and viruses to malicious apps and the
threat of hackers, websites must prevent security breaches on both the front ends and back
ends. Websites built to conduct online transactions, such as ecommerce sites, need additional
security measures to protect customer information. To reduce the potential for browser-based
threats, businesses must add SSL certificates to their websites. During development, its
critical to review the security features included in your sites framework and design.
Businesses also need to conduct regular security checks or work with a provider who offers
this service.
18. Offsite Reviews
Due to Googles search algorithm changes, greater priority has been placed on local searches.
Review services, such as Google and Yelp, can be instrumental in generating qualified leads
for businesses. Now, when customers search for a local business or product, theyre often
greeted with reviews about a company on the first page of search engine results. Obtaining
reviews on third party websites adds to your brands credibility, while making it simple for
viewers to gain insight into customer satisfaction associated with your brand. To guarantee
customers are able to leave reviews about your company, make sure to claim your business
profile on third party review sites like Google and Yelp. You can than create a call to action
on your website that will prompt a client to write a review and lead them to that particular
third party review service.
Google offers a great way to connect your Google+ business page reviews with your website.
As long as you have an address for your business that qualifies and a Google+ account, you
43

can search for your business page and if one doesnt exist already you can create one. Once
Google verifies that youre the owner you will see your Google+ business page linked to your
website whenever it appears in the SERPs.
19. Customer Testimonials
Similar to offsite reviews, customer testimonials can be used to promote your business. By
featuring customer testimonials on your site, you demonstrate your companys skills,
products, and commitment to customers. If you already have a loyal customer base, reach out
to a few and solicit online reviews. If theyre willing to provide a recorded testimonial, take
advantage of this opportunity to create a branded video. The more genuine, detailed
testimonials your company receives, the greater your chances of gaining new customers.
20. Google+ Author Verification
Though Google stopped accepting page verification requests (not to be confused with
Google+ business page verification, which is still active), it remains essential to
complete Google+ author verification for your site. Linking site content to specific authors
using Google+ profiles allows the search engine to easily distinguish between content created
by a human and content of a lesser quality. Completing the Google+ author verification steps
also ensures that the authors byline and photo appear in SERPs. When looking for relevant
content, customers greeted with the promise of information provided by a real person are
more likely to click on the link. As a bonus, claiming your brands byline in SERPs makes it
easier for customers and peers to connect with it.
21. Tracking
Between Google Analytics, Google Webmaster Tools and bing Webmaster Tools, web
developers have the mechanisms necessary to accurately and efficiently calculate return on
investment. For both traditional and mobile websites, these instruments can be used together
to monitor traffic, engagement, and conversion rates. After digging deep into the data, its
possible to uncover which marketing campaigns work best and which are underperforming.
These valuable insights into why customers come to, stay on, and leave your website help
your team perfect marketing strategies and adjust engagement techniques to maximize
results. Since your branded online presence acts as a 24/7 storefront, its essential to simplify
the outcomes measurement process by using Google Analytics along with Google and bings
Webmaster Tools.
22. Comprehensive Sitemap
When you sit down to read a book, whats the most helpful section to review first? Typically,
its the table of contents. Acting as a summary of the books details, the table of contents
provides a snapshot of material found within. Similarly, a sitemap provides visitors and
search engines with the information to easily navigate your website and discover its contents.
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To keep your site up to date, its necessary to revise the site map as new pages are added.
Google Webmaster Tools simplifies this process for you.
23. Original Content
When designing a website, it is crucial to write high quality, original content that is relevant
to your company and products. Everything from the quality of your content to the keywords
used affects your sites ranking in search engine results. Keyword research can provide topic
ideas and, if used sparingly, will help customers quickly locate the content theyre seeking.
To increase the appeal, each web page should have no less than 150 words and should include
links to credible resources and other pages on your website. More than providing
information, the content published on your site should be written to echo your brands unique
voice. Before publishing, use a tool like Copyscape to ensure that it passes duplication
standards. Posting duplicate content on your website will result in steep penalties from
Google, including possible removal from search engine results.
24. Stock Images
Everything found on your website is considered intellectual property and falls under
copyright laws. As one of the worlds leading suppliers of stock photos, Getty Images
regulates the appropriate use of images online. If not posted with permission, images that are
copyrighted may result in fines. When incorporating images into your sites content, make
sure to receive written permission for use and pay relevant fees, if applicable. There are also
sites that offer access to copyright-free images. However, be sure to carefully review terms of
use before posting them. For many businesses, the costs associated with the lawful use of
images outweigh the immediate benefit of getting something for nothing.
Given these 24 aspects of website development and design, its clear that there are many
factors to consider when creating a branded website. In addition to increasing traffic and
generating leads, your sites design, navigation, and content must engage customers and
inspire further interaction with your brand. As you build a website, review the tools and
information outlined in this guide to ensure that your site has the tools required to succeed.
2.ETHICS IN RETAILING
Ethics is a branch of philosophy that deals with values relating to human conduct, with
respect to right or good and wrong or bad actions. Here ethics relates to retailers moral
principles and values.
Ethics is derived from the Greek word ethos which means character. Ethics in retailing pose
certain critical issues. Retailing plays a vital role in the economy. The retail industry is the
first link in the distribution chain, from the customers point of view. It is therefore vital for
retailers to act in an ethical manner because they affect the lives of many people.
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The unethical practices used by the retailers towards consumers are:

i. They charge full price for a sale item without the customers knowledge.
ii. Dont tell the complete truth to a customer about the characteristics of a product.

a. Ethical practice towards consumers:

The retailers should charge fair price for the products offered to them. The consumers have
the right to get correct and precise knowledge about the products sold to them in respect of
warranty, guaranty, price, usage, ingredients etc. Ethics is essential for the long run of the
business. Ethical business is essential in todays competitive and dynamic environment.
b. Ethical practice towards investors/shareholders:
The shareholders are the owners of the business. Shareholders must be given fair returns on
their investment at regular intervals. The share holders should be disclosed with correct
information about the financial status of the business organisation. The business organisation
must act in the interest of the shareholders.
c. Ethical practices towards employees:
Ethical practices must also be followed towards the employees. The retail industry employs
large volume of retail staff. Therefore proper policies and procedures must be framed for the
employees regarding recruitment, selection, training, promotion, welfare etc.
Negative issues relating employment relations in the work place can lead to loss of reputation
and customers, it leads to poor staff morale, low productivity, and high labour turnover. To
avoid these confrontations the retail manager should follow ethical practices towards
employees.
4.0 Ethical issues that can affect retail industry
4.1 Corporate Social Responsibility
CSR has increasingly become the corporate buzz word. It is an enlarged concept
responsibility. It is a general evaluation of "values" linked to the relationship a business
organisation and its environment. In organisation perspective, it is responsibility towards the
customer (Pepe, Fabbio and Mario, 2010). CSR is concerned with the integration of
46

Environmental, Social, Economic and Ethical considerations into business Strategies and
practices (Jones et al 2007).
CSR has become a major component in businesses last few years. Ten years back very few
companies issued CSR reports. But now more than 8000 organisations around the world have
signed the UN global compact pledging to show global citizenship in areas like Human
rights, labour standards and environmental protection (Gustin 2012).Below figure shows how
much CSR is important as a business ethic to organisations.
According to CSR literature, Customers are interested in the social behaviour of
organisations. Those behaviours have a major impact on customers purchasing decisions. In
most occasions, customers themselves claim that CSR profile of a company pays a major role
in what brands they choose to purchase (Castalado et al 2009).Retailing plays a major role
global supply chains. They become the guarantors of entire value chain. Because they are the
once who face the end consumer in supply chains. Particularly those of their own brand
products are directly reflect their corporate image (Pepe, Musso and Risso 2010).
Due to fierce competition in retail environment, retail organisations find it difficult to
differentiate their business from others. Today consumers are not always going after product
attributes like quality and price. Today they evaluate organisations on their ethical attributes
(Homberg, Hoyer and Fassnacht 2002). CSR is the best way to address customers' ethical
needs. In fact CSR is one of the main ethical attribute that customers consider when
evaluating companies. So it's really important for a company to become a good corporate
citizen through CSR.
4.2 "Green" issue
In past few years green issue has become a hot topic in the business world. Majority of the
organizations wanted to go green and many have done it. Going green means simply reducing
the impact or damage which can happen to the environment because of a business. It includes
reducing CO2 emission, reducing wastage, reducing the power usage and using
environmental friendly power sources. Green consumerism is worth 35.5bn (Grant 2009).
Companies like wal-mart have already taken actions towards green retailing. They did it in
business purpose. They installed small generators in its feet of 7200 rig trucks so engine can
be turned off while trucks are parked along with other fuel efficiency measures. With that
they saved $200 million a year. By shrinking the package by 5%, they saved $3.4 million a
year. They are also planning to eliminate 30% of energy use. Two green stores already there
in Colorado and Texas.IN those stores, energy is generated from wind mills. Energy efficient
LED bulbs are there replacing normal bulbs (Dolan 2011).Even Marks & Spencer is also
moving towards green energy (Grant 2009).
Green products are normally expensive. But in 2009 and 2010, the number of green products
rose from 2700 to 4700 a 73% increase (winston 2010).But UK shoppers are least likely to
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pay more for green products. Only 28% f the consumers are willing to pay a premium for
green products (Berwin 2008).Verdict research 2010 show that UK consumers doubt that
whether UK retailers are really environmentally responsible
Figure 4. Consumers attitudes to how environmentally responsible UK retailers are
[Source: Verdict research 2010]
Environmental issues were the earliest and are now the most commonly reported issue among
the top retailers in the world. All the top retail organizations highlight the environment as a
key driver in their agenda of ethics (Jones et al 2007).It shows how important is to be ethical
in environmental aspects.
4.3Product safety
Safety is a basic consumer right. It is safe guarded by the product safety act which ensures
only safe products are available in the market (Vella 2013).Product safety refers to the degree
of risk associated with using of product. Normally any product involves some degree of risk.
But that risk should be under the "acceptable" risk range.
It's every ones responsibility in the supply chain to ensure the safety of the product. In
clothing industry, manufacturers should safe materials and chemicals. Clothing retailers
should be well aware of what they are selling. Like that, each and everyone in the supply
chain have their own responsibilities to assure the safety of the product (Vella 2013).Selling
unsafe product can destroy the customer faith. It can even lead in to bancropsy. It is that
much important to assure the safety of the product. Specially in retail industry.
4.4 Ethical sourcing
This is the most important ethical issue to clothing industry. Socially responsible trading
became a growing issue during the 1990s when companies with global supply chainsparticularly those in the clothing and food industries- were coming under rising pressure from
consumer groups, governments and trade unions to ensure decent working conditions for
those producing their goods. Since then numerous media campaigns highlighting the poor
working conditions in factories and farms in developing countries have been behind the drive
for fair trade and ethically sourced products. In 2009, major retailers like Gap, Next and Asda
where among the headlines because of unethical sourcing of some of their subcontractors'
unethical standards (Morell 2010).
5.0 Benefits of being ethical
5.1 Improve financial performance
Being ethical has a positive impact on company profits. Many researchers found that there is
a positive connection with CSR and Corporate Financial Performance (CFP). Modern
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theoretical and empirical analyses indicate that firms can strategically engage in socially
responsible activities to increase private profits. Given that the firm's stakeholders may value
the firm's social efforts, the firm can obtain additional benefits from these activities,
including: enhancing the firm's reputation and the ability to generate profits by differentiating
its product, the ability to attract more highly qualified personnel or the ability to extract a
premium for its products (Rubn and Christopher 2009).
A real world example for this is GAP. They were suffering from stagnant sales for long time.
They increased their sales through increasingly leverages social and environmental awareness
programs to appeal to its young and progressive clientele in 2010. Gap recently received
270,000 pairs of old jeans that it will turn into insulation for homes. In return, everyone who
supported the project was handed a 30 percent discount on a new pair of "1969 Premium
Jeans" from the Gap (Malhothra 2010).
There is ample data to confirm this profit-generating potential. More than half the consumers
surveyed by Havas media lab want to reward responsible companies by buying their
products. 53% would even pay a 10% premium for those products. But the benefits don't stop
at the check-out line. They extend to stock value as well, as suggested by Harvard Business
School data confirming that this new species of socially responsible company gets more
favorable ratings from securities analists (Levick 2012). Companies who are engaged in CSR
activities are more likely to improve the performance or the overall profitability of the firm
(Orlitzky, Schmidt and Rynes 2003). There is enough evidence to prove that being ethical
helps to improve profits. But some researches shows mix results. Brands that make CSR a
priority are showing great business success, such as Canada's own Lululemon, and Wal-Mart
(Mikakakis 2012).
5.2 Enhance the reputation of brand value
By practicing better ethical business practices, Companies can increase the brand
loyality.CSR and going green particularly helps to raise the brand loyalty along with other
ethical practices.CSR helps to increase customer and worker loyalty (Pepe 2003).Well
planned CSR activities can create an emotional connection with the brands which will
increase the brand loyalty.
5.3 Helps long-term growth and success
CSR builds relationships with customers. CSR, through which a company incorporates social,
environmental, and ethical aspects into its business model, has become integral to
Long-term growth and success (Minakakis 2012).CSR is very important for long-term
sustainability for companies and their employees (Jones et al 2007).

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5.4 Reduces operating cost

CSR activities and going green specially helps to reduce the operating cost. As mentioned in
this report previously, Companies like wal-mart and Marks & Spencer saves huge amount of
money each year by going green .Wal -mart saves $200 million annually in fuel cost by
implementing green practices. They also stand to save $ 3.4 billion a year by reducing the
packing by 5%. It also helps to reduce the marketing cost.CSR enhances word-of-mouth and
the reduction of expensive marketing investments (Pepe, 2007).
5.5 Competitive advantage
CSR,going green and other ethical practices helps to create an competitive advantage for
organizations. Some organizations particularly differentiate their business by going green.
Some use SCR activities to differentiate their business (Piacentini, MacFadyen and Eadie,
2000). Central to the conceptualisation of corporate social responsibility as a business
orientation is the pursuit of a positional advantage. Such as business orientations are
transformed into positional advantage, which in turn results in superior organizational
performance (Matear, et al., 2004). Through CSR, retailers can enhance recruitment and
retention rates and strengthen their bottom line. In fact, there is growing evidence that
companies with CSR strategies outperform their counterparts (Minakakis 2012).
3.EMERGING TRENDS IN RETAILING:
In todays era, the places in the cities have become congested, infrastructure has changed,
transport facilities have increased, and the speed of exchanging information has become
extremely fast. Retailers are adopting new technology. Society is changing, consumers are
changing and so are the retailers. Retailing has managed to keep itself paced with the
changing times.
Changing Nature of Retailing
Retailers are changing their business formats, store designs, modes of communication with
customers and ways of handling commercial dealings.

Modern retailers are adapting new technology for marketing, retail operations, and
business transactions.

Forward-thinking retailers are using social media to communicate with the

consumers.

With the space crunch, modern retailers have learnt how to use every inch of the floor
constructively.

Apart from opening online retail store, the retailers take the help of Augmented
Reality such as 3D mock-ups to let the customer try the products on themselves.

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Retailers are working progressively on delivery of orders that customers placed

through online shopping.

Retailers are bringing something new now and then to charm the customers. Those
places where internet is still not accessible, retailers are exploiting the power of
mobile phones to advertise their products.

Modern Retail Formats

Today, the Internet has changed the way products are advertised and the manner of sellingbuying transactions.
Here are some modern innovations in retail

Modern retail businesses such as malls, specialty stores, and hypermarkets are using
micro development and contemporary technology to increase customers shopping
experience and in turn generate business revenue.

Around the year 2000, online retail startups started changing the face of retail
businesses around the world.

Social media websites such as Facebook changed consumer behavior as well as made
retailers sweat out to take the benefits and develop their brands.

Modern e-commerce facilities enable faster transactions and allow purchase on a

simple 30-day credit facility.

E-Tailing
It is nothing but E-Retailing. It is the process of selling or purchasing the products using
Internet for B2B or B2C transactions. E-tailing process includes the customers visit to the
website, purchasing products by choosing a mode of payment, product delivery by the
retailer and finally, the customers review or feedback.
E-tailing Benefits

It does not require floor space to display products.

It allows the customer having internet access to shop any time, any place

It saves time of the customer otherwise spent travelling to a shopping place in the real
world.

It creates a platform for products from around the world, which are imported by the
e-tailer when the customer places an order.

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OTHER BENEFITS:
1. Power of consumption data leading to better consumer understanding and predictive
modeling
2. Traditional marketing communication model of awareness to trial to purchase has changed.
Prosumers playing an important role; the purchase decision is moving towards influence by
like-minded people, friends, social circle references & recommendations. This prompts
customers to try a brand.
3. Mass customisation is a large opportunity area in the garment space
4. Co-creation of products & services as a key differentiator
5. The store unit is the brand; creating differentiation at retail front in terms of visual
merchandising, personalied services, cutting edge CRM and staff service
6. Relevant information vis--vis aggressive sales pitches: what helps a customer make a
buying decision: Give me relevant information and I will decide what to buy
7. Power of teens to power of pre-teens
8. Uniqueness of design and fit are as important as the brand
9. Play of e-commerce and technology

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