Module I Lecture No 1 to 8

Lecture No 1
Introduction
To Know where you are going , you need to know where you have
been. This is the intention of taking you through a very brief
history of the retail industry.The module briefly touches upon the
retail environment as it stands today and exposes you to the
various formats that are in existence.

Opportunities
A dramatic transformation is taking place as the traditional formats
of kirana stores ,hawkers,grocers,are being replaced by the modern
formats of department stores ,discount
stores,malls,supermarkets,convenience stores,fast food outlets.
FDI ( allowed upto 51 % in single brand retail trade ) investments
from abroad would further improve its
productivity,competetiveness and efficiency.
Players like bagari foods, Fun foods, etc are trying to sell their
products exclusively to large retail chains to overcome the
advertising & distribution hurdles.
It has created huge job opportunity similar to the job scenario in
IT,BPO industry.
Both in metros & two tier cities \towns there is a need for talented
people to plan for merchandise ,in logistics , and to manage the
supply chain information and stores.
Mall management also need trained manpower as around 300
malls are coming up.
Rapid rise in disposable incomes
Changing lifestyle patterns
More nuclear & double income families
Increased use of plastic money
Better access to consumer finance
Large proportion of consumers in age group 20 – 40 years
Challenges
Large geographical areas and a weak infrastructure along with lack
of 3 pl distribution services makes distribution costly.
Real estate is the single largest operating costs which is critical to
the ultimate success of the venture.
Talent management is a challenge as there is a need for quality
training required to deliver high volume low margin &
differentiating service.
For International retailers it will be necessary to ensure that Indian
operations imbibe Indian culture with involvement of local
managers at the highest level.

Conclusion
With the entry of national \ international players in retail sector the
race is on to please the Indian consumer and its time for the Indian
Consumer to sit back and enjoy the hospitality of being treated like
a King.
Facts critical to the success of Indian retail Industry:
1.Evaluation of current market trends
2.Profile discussion of key players in this sector
3.Micro analysis of various challenges & opportunities before the
industry.
Large organized retailers will come up in the suburbs of
metropolitan cities.
Small retailers would continue to occupy a niche position as corner
side shops because with personalized services and convenient
walking distance they are able to provide a special kind of service
which will always be demanded.

Module Objectives

By the end of this module , you will be able to :

  Trace the origin of the word “ Retail ” and comprehend its
definition.
 Appreciate the various functions in the Retail Industry.
 Appreciate its size and importance amoungst other sectors of
the world economy
 Identify the drivers of the retail boom in India
 Identify the challenges for the retail industry.
 Discuss the future trends in retailing
 Distinguish amoung the various retailing formats
 Identify the different merchandise categories offered at stores

Lecture No 2

What is Retail?
According to Philip Kotler : Retailing includes all the activities
involved in selling goods or services to the final consumers for
personal ,non business use.A retailer or retail store is any business
enterprise whose sale volume comes primarily from retailing.
The word retail is derived from the French word retaillier, which
means to cut off a piece or to break bulk.A retailer may be defined
as a dealer or trader who sells goods in small quantities or one who
repeats or relates.
Retailing thus may be understood as the final step in the
distribution of merchandise,for consumption by the end
consumers.
In an age where the customer is the king and the marketers are
focusing on customer delight, retail may be redefined as the first
point of customer contact.

Functions & role of a retailer is to provide real added value or

utility to the customer:
1.In the form of the product itself, a retailer does not supply raw
materials but rather offers finished goods and services in a form
that the customer wants. The retailer performs the function of
storing the goods and providing us with an assortment of products
in various categories.
2.He creates time utility by keeping the store open when the
consumers prefer to shop.
3. By being available at a convenient location he creates place
utility.
4. Finally when the product is sold, ownership utility is created.

Relationship with customer lasts over the complete life of the

product . Therefore the customers experience of our products
continues to be formed & built over the period that they own the
product.To keep our customers satisfied during the complete life
cycle of the product , we have to improve their buying &
ownership experience by becoming their advisors for life .If their
experience is good there is a possibility that they will upgrade
within the brand – thus extending the customer for life.
So if we maintain good work flow process & sales operating
standard then it is possible to deliver uniform & consisitent quality
of services in order to achieve a high customer satisfaction index
which will decide the customers future intention of the 3 R’S
namely:
1. Recommendation
2. Revisit
3. Repurchase.

This results in higher sales & revenue , increased confidence in

company & staff , improved brand image.

.
Lecture No 3
Theories of Retail
No single theory can be universally applicable or acceptable.The
application of each theory varies from market to market ,
depending on the level of maturity and the socio-economic
conditions in that market.
The theories developed revolve around the importance of
competitive pressures,the investments in organizational capabilities
and the creation of a sustainable competitive advantage, which
requires the implementation of strategic planning by retail
organizations.Theories of retail development can be broadly
classified as :
1. Environmental
2. Cylical
3. Conflictual

Environmental Theory
Darwins’s theory of natural selection has been popularized by the
phrase “ survival of the fittest”.
According to this theory those retailers that successfully adapt
technological,economic,demographic and legal changes are the
ones that are most likely to grow and prosper.The ability to adapt
to change,successfully,is at the core of this theory.

Cylical Theory
The most well known theory of retail revolution is The Wheel of
Retailing theory.This theory as described by McNair suggests that
retail innovators often first appear as low price operators with low
–cost structure and low profit-margin,offering some real
advantages,which enables them to take customers away from more
established competitors.They then become vunerable to new
discounters and lower cost structures that take their place along the
wheel.As a result scrambled merchandising occurs as the retailer
adds goods and services that are unrelated to each other and the
firm’s original business so as to increase overall sales and profit
margins.This is termed as the wheel of retailing.

Conflict Theory
Conflict always exists between operators of similar formats or
within broad retail categories.Retail Innovation leads to the
development of more formats.This is also known as the dialectic
process i.e blending of two opposites to create a new format as
follows:
1. Thesis
Individual retailers as corner shops all across the country

2. Anthesis
A position opposed to Thesis develops over a period of time.
These are department stores

3. Synthesis
There is a blending of the thesis and antithesis. Supermarkets
and hypermarkets thrive.

Lecture 4

Classification of Stores
Types of Retail Formats

In this module we attempt to classify the existing retail

models/formats.The basic classification done is based on store
based retailers and non-store retailers.The store based retailers can
be further classified on the basis of the merchandise (operations)
that they offer , or by the manner of ownership.
Classification on the basis of Ownership:
1. Independent Retailer
An independent retailer is one who owns and operates only one
retail outlet.Such an outlet is managed by the owmer & proprietor
and many such stores tend to be passed on from generation to
generation examples are Daily needs shop, Roadside vendors, paan
shops.
2. Corporate Retail chain
When two or more outlets are under a common ownership , it is
called a retail chain.
Examples are Spencers , shoppers stop, Arrow.

3. Franchising
A franchisee is a contractual agreement between the franchiser and
the franchisee , which allows the franchisee to conduct business
under an established name as per a particular business format , in
return for a fee or compensation. Examples are Mc Donalds &
Pizza Hut.
4. Leased Departments
These are also termed as shop in shops.When a section of a
department in a retail store is leased/ rented to an outside party , it
is termed as a leased department.Examples are perfumes &
cosmetic counters

5. Consumer Co Operatives
A consumer co –operative is a retail institution owned by its
member customers.Examples are Sahakari Bhandar & Kendriya
Bhandar

Classification on the basis of the Merchandise Offered

If retailers are to be classified on the basis of the merchandise
mix(operations) that they
Offer to their customers, yhey may be very broadly be classified
into food and the general merchandise retailers.Within this
classification we can further classify them on the basis of the target
market that they cater to – examples are speciality
stores,department stores and convenience stores
1 Convenience Stores
These are relatively small stores located near residential areas-
they are open for long hours, open seven days a week and offer a
limited line of convenience products like eggs,bread, milk.Size
varies from 1000 sq ft to 3000 sq ft . examples are Reliance Fresh ,
Subiksha .

2. Supermarket
These are large , low cost , low margin , high volume , self service
operations designed to meet the needs for food , groceries & other
non food items(like garments & electronics).Examples are
Reliance Super , sizes are 5000 sq ft to 10,000 sq ft.

3. Hypermarket
The word hypermarket is derived from the French word
hypermarche, which is a combination of a supermarket and a
department store.The store occupy an area which ranges from
anywhere between 80,000 to 2,00, 000 sq ft and offer a variety of
food and non food products like clothes , jewellery, sports
equipment , cycles , books ,cd’d , tv’s , computers apparels ,
furniture , travel accessories.Examples are BigBazar .,Walmart,
Star Bazar.

4. Speciality Stores
A store specializing in a particular type of merchandise or single
product of durable goods ( that is home furniture , consumer
electronics) is termed as a speciality store.Examples are jewellery ,
apparel , furniture.

6. Department Stores
A department store is a large – scale retail outlet that offers a
number of different product categories.Size varies from 20,000 sq
ft to 40,000 sq ft Examples are Shoppers Stop, Westside , Lifestyle.

7. Other Formats
Factory outlets – are off price retail outlets, Catalogue showrooms
– non product display, Dollar Stores , Automateed vending /
Kiosks for cigarettes , cand & toffee, The cash & Carry for small
businessmen & retailers., Airport Retailing – gift shops

Lecture 5
Franchisor and Franchisee

Concept , Types , advantages , disadvantages.

Concept : The origin of the word ‘ franchising ‘ can be traced back

to the French word franchise , which means to grant powers to a
peasant.
Definition : A franchise is a ‘ continuing relationship in which the
franchisor provides a licensed privilege to do business , plus
assistance in organizing, training,merchandising, and
management , in return for a consideration from the franchisee. ‘
Franchisor is the seller of the franchisee , he owns the
trademark/product/service and licenses the trademark to another
party.
Franchisee is the person who pays for and purchases a franchisee
from a franchisor as above and operates a business using the
name , product , business format provided by the franchisor.
Types
The first type being a product/tradename franchise and the second,
a business format franchise.
Under product / trade name franchising , the franchisee
concentrates on one manufacturers product ,. Examples are
automobile , dealership and gas service stations.
Business Format franchising has been defined as the granting of a
license for a predetermined financial return , by a franchisor to its
franchisees , entitling them to make use of a complete business
package , including training , support and the corporate name ; thus
enabling them to operate their own businesses according to exactly
the same standards and ‘ format ‘ as the other units in the
franchised chain .Examples are restaurants , convenience stores.
Advantages of Franchising
Low Risk – a franchise business eliminates the risk of learning
from a completely new business
Growth – As a franchise is a part of a network the opportunities for
the individual franchisee to grow also increase.
Ease of Financing & Operational Support – a franchisor may assist
the franchisee in obtaining financing for the setting up of the
business.
Advertising – advertising costs are greatly reduced because the
cost is shared by the franchisee.

Disadvantages
Royalty / Fees – The franchisee fees or the royalty that may be
required to be paid may be relatively steep for a successful brand.
Lack of control – if the franchisee acts independently , it may
result in the loss of goodwill/dilution of brand.
Franchising in India – examples are Holiday Inn , Domino’s ,
KFC , Pizza Hut. It is estimated that are over 600 active
franchisors in the country and over 40 ,000 franchisees across
various sectors in India. Annual turnovers range between Rs.8,000
to Rs.10,000 crores and investments are believed to be Rs.5,000
crores , employing over 3,00,000 people.
Lecture 6
Organised and Unorganised
The local kirana store . the paanwala . and the vegetable vendor
who are very much a part of the Indian retail landscape , are
termed together by many as the unorganized sector.They do not use
technology , they are well aware of the needs and wants of their
customers , are aware of their likes and dislikes and they know
what and how much to stock.Many of them also know their
customers by name and offer add-on services like free home
delivery and credit facilities.This is the traditional form of retail in
India. While it is true that traditional formats exist in all the
markets of the world , the level of maturity of the market
determines the dependence on the formats – traditional or modern.
The total retail sector in India is estimated at rs.9,30,000 crores
( 2003 – 04 ).The organized retail sector stood at Rs.28,000 crores
in the same year. , thereby accounting for a mere 3 % of the total
retail trade. The organized retail trade is estimated to be around Rs.
1,00,000 crores by the year 2010.

Break up of Retail Trade in India ( report 2005 KSA Tecnopak )

Retail Segment Total size ( Crores ) Size of Organised

( Crores)
Clothing & Fashion 80,000 10,900
Accs
Jewellery 43,500 850
Watches 2,800 1,110
Footwear 10,000 2,500
Health & Beauty 30,000 550
Care
Consumer Durables 32,000 2,500
Mobile Handsets & 13,000 840
Accs
Furniture & 33,000 2,200
Furnishing
Food & Grocery 61,500 2,000
F & B ( Catering 35,000 2,000
Services )
Books & Music 8,200 800
Entertainment 25,000 650

Total 9,30,000 28,000

Size of the Organised Retail market ( Rs. Cr )

Category 2001 - 02 2007 CAGR ( % )

Food 1800 7473 33
Clothing 4950 10423 16
Consumer 1650 3787 18
Durables
Books & 450 1426 26
Music
Total 16000 37216 18

Module I
Lecture 7

Retail Scenario in India

1. Pantaloon Retail:
It is headquartered in Mumbai with 450 stores across the country
employing more than 18,000 people. It can boast of launching the
first hypermarket Big Bazaar in India in 2001. An all-India retail
space of 5 million sq. ft. which is expected to reach 30 mn by
2010. It is not only the largest retailer in India with a turnover of
over Rs. 20 billion but is present across most retail segments -
Food & grocery (Big bazaar, Food bazaar), Home solutions
(Hometown, furniture bazaar, collection-i), consumer electronics
(e-zone), shoes (shoe factory), Books: music & gifts (Depot),
Health & Beauty care services (Star, Sitara and Health village in
the pipeline), e-tailing (Futurbazaar.com), entertainment (Bowling
co.)

One of their recent innovations include e-commerce’ hybrid format

of ’small’ shops , the area for these stores will be 150 sq. ft. fitted
with 40 digital screens. Customers will be encouraged to browse
through the entire range of products on digital screen. They will be
able to place the order, the delivery of which will be arranged by
the shop to their homes within a few hours

2. K Raheja Group

They forayed into retail with Shopper’s Stop, India’s first

departmental store in 2001. It is the only retailer from India to
become a member of the prestigious Intercontinental Group of
Departmental Stores (IGDS). They have signed a 50:50 joint
venture with the Nuance Group for Airport Retailing. Shoppers
Stop has 7, 52, 00 sq ft of retail space with a turnover of Rs 6.75
billion.

The first Hypercity opened in Mumbai in 2006 with an area of 1,

20,000 sq. ft. clocking gross sales of Rs. 1 bn in its first year.

Crossword brand of book stores, Homes stop a store for home

solutions, Mothercare a concept stocking merchandise related to
childcare are also owned by them. Recently, Raheja’s have signed
an MoU with the Home Retail Group of UK to enter into a
franchise arrangement for the Argos formats of catalogue &
internet retailing.

The group has announced plans to establish a network of 55

hypermarkets across India with sales expected to cross the US$100
million mark by 2010.

3. Tata group:

Established in 1998, Trent - one of the subsidiaries of Tata Group -

operates Westside, a lifestyle retail chain and Star India Bazaar - a
hypermarket with a large assortment of products at the lowest
prices. In 2005, it acquired Landmark, India's largest book and
music retailer. Trent has more than 4 lakh sq. ft. space across the
country. Westside registered a turnover of Rs 3.58 mn in 2006.

Tata’s has also formed a subsidiary named Infiniti retail which

consists of Croma, a consumer electronics chain. It is a 15000-
17000 sq. ft. format with 8 stores as of September 2007.

Another subsidiary, Titan Industries, owns brands like “Titan”, the

watch of India has 200 exclusive outlets the country and Tanishq,
the jewellery brand, has 87 exclusive outlets. Their combined
turnover is Rs 6.55 billion.

Trent plans to open 27 more stores across its retail formats adding
1.5 mn sq ft of space in the next 12 DLF malls.

4. RPG group:

One of the first entrants into organised food & grocery retail with
Foodworld stores in 1996 and then formed an alliance with Dairy
farm International and launched health & glow (pharmacy &
beauty care) outlets. Now the alliance has dissolved and RPG has
Spencer’s Hyper, Super, Daily and Express formats and Music
World stores across the country.
RPG has 6 lakh sq. ft. of retail space and has registered a turnover
of Rs 4.5 billion in 2006.

It is planning to venture into books retail, with the launch of its

own bookstores “Books and Beyond” by the end of 2007. An IPO
is also in the offering, with expansion to 450+ MusicWorld, 50+
Spencer's hyper outlets covering 4 million sq. ft. by 2010.

5. Landmark group:

were launched in 1998 in India. Lifestyle is spread across six

cities, covering 4.6 lakh sq. ft. with a turnover of Rs 3.5 billion in
2005. A new division named Lifestyle International has emerged
for their international brands business comprising Bossino, Kappa
and Springfield in their portfolio.

Their retail mix includes Home solutions (Home centre), fashion

(lifestyle, landmark International), value retailing (max retail),
hypermarkets & supermarkets (Max), kids entertainment (Funcity).

They plan to invest Rs. 300 crores in the next two years to expand
on Max chain, and Rs 100 crores on Citymax 3 star hotel chain.
They have already instituted a separate company christened
Citymax Hotels (India).

6. Piramal Group

In September 1999, Piramal Enterprises announced their arrival

into retail with the launch of three retail concepts: India's first true
shopping mall of international standards, called Crossroads; a
lifestyle department store named Piramyd Megastore; and a family
entertainment centre known as Jammin. Piramyd Megastore and
Jammin were anchor tenants for Crossroads (recently sold to
Pantaloon for Rs 4 billion). In 2001, the group entered the business
of food & grocery retail with the launch of TruMart supermarkets
in Pune.
They have around 18 TruMart stores covering 1.90 lakh sq. ft.
registering a turnover of Rs 37.6 mn in 2005. Piraymd Megatsore’s
contributes more than 70 % to their retail mix with a turnover of
Rs 112.8 mn. They plan to open 150 stores covering 75 mn sq ft of
retail space in the next 5 years.

7. Subhiksha

Subhiksha is a Chennai-based, decade old, no frills, food, grocery,

pharma and telecom, discount retail chain. ICICI Venture Capital
holds 24% in the equity capital of Subhiksha. It has more than 500
stores across the country covering a retail space of more than 1
million sq ft with a registered turnover of Rs 3.34 bn in 2006. It
has a planned investment of Rs.300 crores to ramp up its
operations to 1200 stores by 2008.

New but potential BIG players

8. Bharti-Walmart

Their plans include US$ 7 bn investment in creating retail network

in the country including 100 hypermarkets and several hundred
small stores. They have signed a 50:50 percent joint venture
agreement with Walmart. Wal-Mart will do the cash & carry while
Bharti will do the front-end.

9. Reliance

India’s most ambitious retail plans are by reliance, with

investments to the tune of Rs. 30,000 cr ($ 6.67 bn) to set up
multiple formats with expected sales of Rs 90,000 crores ($20 bn)
by 2009-10.

There are already more than 300 Reliance Fresh stores and the first
Reliance Mart Hypermart has opened in Ahmedabad. The next
ones are slated to open at Jamnagar, followed by marts in Delhi /
NCR, Hyderabad, Vijaywada, Pune and Ludhiana.
10. AV Birla Group

They have a strong presence in apparel retailing through Madura

garments which is subsidiary of Aditya Birla Nuvo Ltd. They own
brands like Louis Phillipe, Van Heusen, Allen Solly, Peter England,
Trouser town.

In other segments of retail, AV Birla Group has announced

investment plans of Rs 8000 - 9000 crores in the first 3 years till
2010.

The acquisition of Trinethra (food & grocery) chain in the south

has moved their tally to 400 stores in the country. Their “More”
range of 15 supermarkets are slated to open at Nashik, Pune and
other tier II cities in Western India in 2007.

Module I
Lecture 8
Current Trends in Retail

Factors affecting the growth of retail in India

Growth in GDP , Changing Income Profiles , the emergence of
young Earning India , FDI in Retail

Challenges to Retail Development in India

Retail not being recognized as an industry in India
The high costs of real estate
High stamp duties
Lack of adequate infrastructure
Multiple and complex taxation system

Current Trends
1. Modern Retail will thrive but traditional Retail will survive.
2. Consumption will shift to Lifestyle categories
 3. New Retail formats will emerge and grow
4. Modern Retail Growth will be fuelled by private equity
infusion
5. Consolidation will increase in the Retail sector
6. There will be creation of large Retailer Brands ( Private
label )
7. There will be interesting interplay between retailers &
suppliers
8. Modern retail will face a few key bottlenecks
9. New Investments will happen in the back end
10. Modern retail will benefit consumers & rural sector

Module II Lecture 9 to 20

Lecture 9

Retail Store Operations

Overview

An important part of retail management is managing store

operations. Store operations are all the activities that must be
performed to make the store functional and fulfil target customer’s
expectations from the store.These include the following key
activities:
  Managing the operations on the shop floor and the back-end
to ensure a smooth and pleasing customer experience.
 Ensuring safety of the merchandise ,store and people ( staff
and customers).
 Ensuring right quantity of merchandise is available at the
right time and right place.
 Ensuring fast check-in and check-out of customer.
 Managing records and reports for predicting right quantities
of the right product and analyzing buying trends.

These activities have been divided in the seven key areas:

1. Performing store administration

2. Managing store environment
3. Ensuring store security
4. Managing inventory , stacking and display
5. Managing promotions , events , alliances and
partnerships
6. Managing customer service
7. Managing cashiering and receipts

Module II

Lecture 10

Store Administration

Store administration deals with various aspects like the cleanliness

of the store premises , maintenance of the store façade and the
display windows, etc.Administration is also responsible for
utilizing the store personnel effectively. This involves the task of
cleaning the store and arranging the merchandise before the first
customer can walk into the store. The premises of the store need to
be maintained as per the standards decided upon by the
management. An important task of administration involves
ensuring that all the required permissions and licenses to run a
retail establishment are procured from the right authoriries.
Following is the list of Licenses to be needed:
1.Registeration under Shop & Establishment Act
2.License for Weights & Measures
3.Registeration for Central Sales Tax
4. Registeration for Employees Provident Fund
5. Phonographic Performance License or Music License

Module II
Lecture 11

Store Environment management

Managing the operations of a retail store starts by determining how
the tasks pertaining to the premises are to be performed. Firstly ,
the duration of the hours for business need to be determined
alongwith specifying with whom the responsibility of opening and
closing the store lies with.
Security of the store premises and of the merchandise in the store
is equally important.

Module II
Lecture 12

Security of merchandise is needed to ensure that pilferage of

merchandise or shrinkage as it is commonly termed , is minimal.
Inventory shrinkages may arise due to theft by employees ,
customers or by error on the part of the store at the time of
receiving merchandise. A large number of retailers across the
world use specially designed tags , which are attached to products.
These tags are sensed by the electronic devices specially designed
to detect them and are usually placed at the store entrance and
exits.If an attempt is made to take the product out of the store
without removing these tags , an alarm goes off , thus alerting the
store personnel.The other device used for monitoring the
movement of customers and staff is video cameras.Some retail
stores also provide separate entrances and exits for store staff , so
that they can be checked each time they leave and enter the store
premises.

Module III
Lecture 13
Man Management Duty Roster

Module III
Lecture No 14

New Store Opening

Another very important activity that is critical to the retailing

industry is new store opening. In this the newly recruited
operations team takes handover from projects team so as to make
the store ready before opening the store for customer entry. The
following stages are part of a new store opening manual process :

I Human Resource :
 Recruitment of Team ( CSE , SR CSE , SS , DM & ASM)
 Training Modules & Induction ( do’s & don’t’s briefing )
 Trade Licenses
 Admin requirements
Following is the HR opening checklist :
1. Municipal License
2. Prevention of Food Adulteration License
3. Drugs License
4. Insecticide License
5. Central & State Sales Tax registeration certificate
6. Shops & Establishment Act
7. Civil Supplies License
8. Contract Labour registeration certificate
9. Phonographic performance License
10. ESIC certificate
11. Stamping registeration certificate ( weights &
measures)
12. EPF ( Provident fund)
13. Uniform for Staff , promoters & concessainners
14. ID cards for all staff
15. EPABX & telephone lines
16. Office stationary
17. Xerox jobbers
18. Bagging ( housekeeping & security )
19. Courier
20. Liason with police , fire dept & other local bodies
21. Photographer
22. Travel agents
23. AMC – systems , printers & telephones
24. Drinking water supply
25. Lockers
26. Coffee/tea vending machine
27. Garbage bins
28. Salary accounts

II Operations:

 Project handover checklist

  Marketing checklist
 Loss Prevention checklist
 Warehouse checklist
 Outsourced services checklist
 Equipment master checklist

Following is the project handover checklist:

1. Heavy duty & light duty racks
2. Shelving accessories – peg hooks & perforated back
panels
3. Tubelight guard on racks
4. Price Indicator label data strips
5. Slotted angle racks
6. Impulse bins
7. Partition works – changing room
8. Stackable hyper bins
9. Vegetable heapers
10. Electronic weighing scales
11. Chillers
12. Freezers
13. Safe
14. Fire Extinguishers
15. Cable TV connection
16. Erection of cash counter / check out
17. POS installation & POS weighing scale
18. Carpets
19. Floor treatment
20. Trolley Bay
21. Trolley & shopping baskets
22. Wheel chair
23. Entrance door mat
24. Signages – all internal & external
25. Pest control & fumigation
Following is the marketing opening checklist:
 1. All labels – top 100 sku , supplier out of stock
2. All A2/A3/A5 POP holders
3. Layout of merchandise flow
4. Identification of subcat location bay wise
5. Fixing of data strips
6. Receipt of plannogram
7. Receipt of end cap & till end plan
8. Hyper bins positioning & marking
9. Display policy & top stacking procedures
10. Internal signage positioned & cleaned
11. Line of sight SKU’S marking
12. Cross bins position
13. Wall signages
14. External area debris clearance
15. Parking rules , regulations & lighting
16. Electrical conection for concessainnaires
17. Ad hoc price change requisition form
18. Exchange procedure
19. Perpetual inventory procedures
20. Unclaimed baggage / lost & found procedures
21. Conessainnaires terms of trade / signed off agreement
22. Marking of two wheeler & four wheeler parking
23. Marking of trolley bay
24. Main awning lighting check
25. Customer toilets
26. Final painting & patch up
27. Emergency lights working
28. Promotions test run
29. PA system working & training
30. Instore music system with local music
31. Free gifts updation check
32. Door mats & garbage bins positioned

Following is the Loss Prevention check list:

1. Prepare evacuation & fire team
 2. List of telephone numbers in case of emergency
3. Locks for doors & shutters
4. Fire detector installation
5. First Aid box
6. Generator operations training
7. Diesel vendor identification , stock availability &
supply schedule
8. Key board cabinet
9. Frisking chambers with curtains
10. Fire alarm test register
11. Key control register
12. Photography & visitor register
13. Material In & Out register
14. Security staff movement register
15. Security guard roster & duty register
16. Fire officer inspection certificates
17. Cash room burglar alarm check
18. Store opening & closing register
19. Numbered tokens for customer baggage
20. Briefing all staff on fire evacuation drill , process
& procedures
21. Signage indicating emergency exit
22. Lock sealing tape
23. Notice Board
24. Customer counting machine
25. Cash cabin opening 7 closing register
26. Shop lifting register
27. Promoters timing & duty roster
28. Warehouse scrap register

Following is the Warehouse opening checklist:

1. Pumping trolley
2. Weighing machine
3. Sealing machine
4. Crates
 5. Pallettes
6. Drums
7. EAN code scanner
8. 2 Up / 5 UP barcode scanner
9. Packing material – BOP covers (50 gm,100
gm,200gm500gm)HDPE bags (10kg,20kg,50kg) , F&V rolls

Following is the outsourced servives checklist:

1. Electrical contractor
2. Housekeeping agency
3. Painter
4. Plumber
5. Pest control agency
6. Shutter mechanic
7. Carpenter
8. Garbage disposal
9. Scrap sale contractor
10. Cable Network

Following is the check list of equipment master:

1. Water cooler
2. Tables
3. Almirah’s
4. Split & window AC
5. Visitor chairs
6. Manager chairs
7. Staff lockers
8. Filling cabinet
9. Fax

IV Commercial :
 Requirements for new stores
 Cash Supervisor checklist
 Stationary checklist
Following is the commercial opening checklist:
1. Currrent Bank a/c
2. Cash pick up
3. Coins for change
4. ‘C’ forms
5. Insurances till cash & safe cash
6. Insurance public liability & fidelity
7. Fake currency detector
8. Cash counting machines
9. Emergency lamps
10. Cashier OB boxes with stapler , calculator.
11. Declaratiob register
12. OB register
13. Cashier shortage summary
14. Petty cash /Impressed register
15. Sage register
16. Manual Bill Books
17. Special Discount Authorisation Book
18. Refund register
19. Day end & begin procedures
20. Banking register
21. POS rolls
22. Cash receipt books
23. All voucher , computer , box, flat files
24. Carry bags availibility

V IT :
 Equipment checklist
 Pre Opening checklist

Following is the IT opening checklist:

1. Check all SKU’S prices are reflecting on cask till
2. Check MRP price wih system product price
3. Check F & V price matches with product on floor
4. Check bill no is starting from 0
 5. Ensure data back up plan

Module II
Lecture 15

Indenting and Receiving:

HyperLucknow
MAX POINTS
INDENTING TO DC

Was Stock -updation done

properly? 1 0
(Check for 3 days at random)

Is the Indenting being done as

per schedule? 1 1
(Check for the time on the
printout)
TOTAL 2 1

Indenting:

SKU_NAME CAT UOM QNT.

APPLE FIJI FRU. KG ?
APPLE GRAINY SYMITH FRU. KG ?
APPLE ROYALGALA FRU. KG ?
APPLE WASINGTON FRU. KG ?
BANANA ROBUSTA FRU. PCS ?
BEANS FRENCH VEG. KG ?
BEETROOT VEG. KG ?
BITTER GOURD VEG. KG ?
BOTTLE GOURD LOOSE VEG. KG ?
BRINJAL NAGPUR VEG. KG ?
BRINJAL SUPHAL VEG. KG ?
CABBAGE VEG. PCS ?
CAPSICUM BELL GREEN VEG. KG ?
CAULIFLOWER VEG. PCS ?
CHERRY FRESH LOOSE FRU. BOX ?
CHILLI GREEN VEG. KG ?
CLUSTER BEAN VEG. KG ?
COCCINEA VEG. KG ?
COCONUT FRU. PCS ?
COLOCASIA VEG. KG ?
CUCUMBER KEERA VEG. KG ?
FRESH ALMOND FRU. KG ?
FRESH DATES FRU. PKD ?
GARLIC VEG. KG ?
GINGER VEG. KG ?
GRAPES IMPORTED FRU. KG ?
KAMALKAKDI VEG. KG ?
KHARBOOZA FRU. KG
SRADHDA(YELLOW
MELLON) ?
KIWI FRU. PCS ?
LADIES FINGER(OKHRA) VEG. KG ?
LEMON VEG. KG ?
LOBIA VEG. KG ?
LOOSE DHANIA VEG. KG ?
LOOSE PALAK VEG. KG ?
MANGO SAFEDA FRU. KG ?
MINT LEAF VEG. KG ?
MUSAMBI LOOSE FRU. KG ?
ONION VEG. KG ?
PAPAYA FRU. KG ?
PARWAL LOCAL VEG. KG ?
PEACH IMPORTED FRU. KG ?
PEARS IMPORTED FRU. KG ?
PINEAPPLE FRU. PCS ?
PLUM LOOSE FRU. KG ?
POMEGRANATE FRU. KG
MRIDULA ?
POTATO PREMIUM VEG. KG ?
POULTRY EGGS PACK OF
6 VEG. PKD ?
PUMPKIN COUNTRY VEG. KG ?
RATNAGIRI RAW MANGO VEG. KG ?
RAW BANANA VEG. KG ?
RED CARROT VEG. KG ?
RIDGE GOURD VEG. KG ?
SWEET TAMARIND FRU. PCS ?
TOMATO COUNTRY VEG. KG ?
WATERMELON-KIRAN FRU. KG ?
MANGO DASHARI FRU. KG ?
MANGO MALLIKA
{HUSNHARA} FRU. KG ?
MANGO LANGDA FRU. KG ?
MANGO
KESAR{MUMBAIYA} FRU. KG ?
APPLE GOLDEN
(ITELIYEN PEACH) FRU. KG ?
MANGO CHAUSA FRU. KG ?
KARONDA VEG. KG ?
LEAF CHANNA
SAAG(RED SAAG) VEG. KG ?

Receiving:

HyperLucknow
MAX POINT
RECEIVING

RECEIVING FROM DC
Was the trip sheet in order? 1 1

Are there incidents of seal

tampering reported by security?
(Check security register) 1 1

Cartons/Gunny bags/HV Boxes -

Were the quantity cross verified?
(Check vehicle log with security
register) 1 0

Are discrepencies mentioned in

the GAD Sheet? 1 0

Are GAD sheets sent to WH on a 1 0

daily basis duly signed by
Supervisor/Store Manager?

Has TO/TI been received for

GADs? 1 0

DSP RECEIVING :
PRIOR TO RECEIPT:

Was the P. O. raised and

suppliers informed?
(Check P.O. Register)

Were the P.O.s raised within the

scheduled time?

Are the suppliers delivering as

per agreed schedules? 1 1
(Check Receiving time on invoice
of available invoices)

AT THE TIME OF RECEIPT:

Did Security make entry into the

pass-in slip register? 1 0
(check for any inconsistencies in
serial nos or dates)

No receiving after 4:30 PM

(check with WH)

Did security make Pass-in-slip

supplierwise?
(Check last 3 days details.)

Were there any discrepency?

Price/Quantity? 1 0
(Check previous days details)

Were the discrepencies corrected

by the supplier? 1 0
(Check previous days details and
whether signatures were
obtained)

AFTER THE RECEIPT :

Are the GRNs prepared daily?

(Check last three days details.
Check total no. of Security Pass
and
the total no. of GRNs raised)

Was the printout of the GRN

taken and a copy attached with
the bill?
(Check the previous days
details.)

DSP ordering register to be

maintained properly (Manual
Register) 1 0
Ordered vs Received quantity

After the day end, was the GRN 1 0

register printed and the bills
with GRNs sent to the HO on a
weekly basis?
(Check the last 4 days details)

Is it signed by the WH Manager? 1 0

(Check the last 4 days details)

When the products come under a

challan and the bill next day,are
these compared? (Check three
dates) 1 0

Is the above signed by the

vendor and the WH Manager? 1 0
TOTAL 15 3

Module II
Lecture 16

Store opening and Closing:

HyperLucknow
MAX POINTS

STORE OPENING AND

CLOSING

STORE OPENING
Was the Store opening details
recorded in the Store Opening
and Closing Register? 1 0
( Check for 3 days at
random)

Was the transfer of keys done

through the Register? 1 0

STORE CLOSING

Was the Store opening details

recorded in the Store Opening
and Closing Register? 1 0
( Check for 3 days at
random)

Was the transfer of keys done

through the Register? 1 0

CASH DEPT -SAFE ROOM

Is the safe being opened and
closed in the presence of the
LP? 1 0

Is the safe room closed at

6.30pm?

Does the Cash In-charge

have a set of all keys? 1 0
TOTAL 6 0
Module II
Lecture 17

Cashering:

CASH

CASH COLLECTIONS
Does pick up/declaration cash total for the day agree with Bank p
next working day?

CREDIT CARD SLIPS AND COLLECTIONS

Is EDC/ EOD Settlement equal to CB4?

Is EOD Settlement available for all days?

Is EOD settlement made at the end of the same day?

Are manual charge slips summarised and presented to the bank n

applicable)

Are cashier declarations backed by chargeslips?

Have Credit card slips been checked with credit Card demand sum
and CB1?

Are reconciliations done on receipts?

Are discrepancies being recorded?

Have receipts against credit card been entered?

Are Service charges are as per agreed rates?

Does the Daily Sales/Outstanding report, reconciliation

statement for the day tallied with CB1 and SL3 on a daily
basis?

COUPONS SALES
Have the coupon summary been checked with coupon report
CB5 and CB1?

Have receipts against Coupon sales been entered on the day of t

cheque?

Are the cheques banked on the next working day?

Are the coupons sent to Issuer tallied with CB5 and signed by the

Are the coupons Cancelled by C & A everyday?

(Verify coupons on the day of audit)

Whether free coupons / paper cuttings are sent to HO alongwith

SALES CASH:
Does the number of pouches tally with the entries in the drop box
Is it done in the presence of LPO?
(Check for the time & signatures of the CSS and LPO).

FLOAT CASH:
Is the FC handed over to the Cashiers through the CR2/OB/FC Re
by both cashier & CSS
Check the CR2 Register

Is the FC amount taken back and entered in the CR2 Register dur

IMPREST CASH:
Is the Expense summary note signed by the Stock Controller?

Whether the denominations of cash/coins are recorded at the bac

page/register?

Is sales cash utilised for petty expenses?

(Check: Any till and go to option called cross check and take a
with physical cash in the tills cash drawer and question any short

SUSPENSE VOUCHERS
Is the voucher being signed by the Stock Controller?
(ideally there should not be any suspense voucher)

HOME DELIVERY
Are Home Delivery bills entered in the home delivery manifest, se
before loading

Has LP Manager conducted surprise checks in the Home Delivery

SDANs
Are SDANs are prepared prior to the giving of discount?

Are reasons given for the SDANs?

Is it signed by the floor supervisor?

Is it counter signed by the floor manager?

Are they serially numbered/dated?

Are POS bill and till numbers written?

Does EX6 report reflect the SDAN discounts?

Are Discounts over Rs.500/- have the business head's signature?

Is there adequate controls on issue of books?

Credit customers
Are the Customer introduction formats duly signed by the busine
category manager?

Is credit limit fixed for every customer?

Are credit period clearly mentioned?

Is there any outstanding which exceeds credit limit?

Is there any outstanding which exceeds credit period?

Manual bills
Do they have the reference of the POS bill number and till numbe
Are they serially numbered/dated

Is there adequate controls on issue of books

Money Receipts
Is there adequate controls on issue of books? ( should only be wi

Are they serially numbered/dated

Are original (white copy) attached for adjustment against bills?

Do they have the reference of the POS bill number and till numbe

Are there cash refunds?

Is there an IOM for other income (Marketing & Concessionaires)?

Safe Register
Is it updated everyday?

Are all monies received entered in the register (manual bills, mon

Are all monies received deposited the next day ( except advances
code)

Are promotion gifts (Gold/Silver articles) entered in the register?

TOTAL
Module II
Lecture 18

Statutory and Process Audit :

PROCESS AUDIT FORM FOR

HYPER STORE FORMAT

HyperLucknow
MAX POINTS
RETURNS

RETURNS TO VENDORS
Is the damaged/expired stocks
being returned to vendors as per
schedule? 1 1
(These stocks are to be returned by
NRGP at the time of next delivery.)

Is the GRWM being signed by the

Supervisor and the WH Manager? 1 0

Are TI's received within stipulated

time (2-3 days from collection date) 1 0
RETURNS TO DSP VENDOR
Were the stocks returned under a
Non Returnable Gate pass? 1 1

Was it duly signed by the Supplier? 1 0

Are NRGPs entered in NRGP register

with the Security? 1 0

Have the NRGP been sent to HO? 1 0

RETURNS TO F&V VENDORS

Is the qty returned entered in the
register? 1 0

Is it signed by the warehouse staff

and the security? 1 0

Are NRGP's raised on the same day 1 0

TOTAL 10 2
HyperLucknow
MAX POINTS

STOCKS TO BE DISPOSED
AT STORES
F&V AND BAKERY

Is the F & V and Bakery

SKUs dump being entered in
the Dump register & signed
by the supervisor 1 0

Are DADs signed by WH &

Cat. Supervisor & LP? 1 0

Are SVs raised everyday? 1 1

Is the SV signed by the

Stock Controller? 1 0

Are there differences

(Quantity and Code)
between dump register,DAD
& SV? 1 0

Are the stocks being

dumped in the presence of
LP/security staff? 1 1
OTHER CATEGORIES

Are DADs signed by WH &

Cat. Supervisor & LP? 1 1

Is the SV signed by the

Stock Controller? 1 0

Are there differences 1 0

(Quantity and Code)
between DAD & SV?

Are the stocks being

dumped in the presence of
LP/security staff? 1 1

TOTAL 10 4

HyperLucknow
MAX POINTS
INVENTORY AT STORE

PI/HV
Is PI / HV check done on a daily basis? 1 0

Is the CSA alloted for PI/HV rotated on a

regular basis? 1 0

Were all the SKUs counted? 1 0

(Check for last 5 days)

Was PI-HV list printed out? 1 0

(Check for last 7 days)

Is the PI/HV report signed by the Stock

Controller? 1 0
Was the diff in the Book and Physical
quantity more than 5 in any SKUs? 1 0

Physically inspect 5 SKUs each of the

stocks reported short and HV on the day of
audit. Are all in order? 1 0

STOCK UPDATION & QUANTITY

RECONCILIATION
Have the cumulative net transfer quantity
and value as per warehouse Guard sheet
been tallied with SK1 net transfer quantity? 1 0

Have the SL3 quantity and value been

tallied with SK1 sale value? 1 0

Have SV quantity and value as per SV

register been tallied with SK1 quantity? 1 0

Have stock updation control quantity been

agreed with SK1 quantity? 1 0

TOTAL 11 0

F & V STOCKS
Lucknow
POINTS
MAX
 Hyper
Is the Dump check
completed before 10.30 AM 1 1

Are Salvaging of F & V being

done regularly? 1 1

FLOOR CLEANLINESS - F&V 1 1

Hourly Freshness Checklist

done 1 0

Baskets availability 1 1

Packing & Sticker roll

availability

Adequate staffing 1 1

Pricing display standards 1 0

Heapers full 1 1

Benchmarking done (twice a

week minimum) 1 1

Weighing scales in order 1 1

Barcoding & till cleanliness 1 1

TOTAL 11 9

HyperLucknow
MAX POINTS
HUMAN RESOURCE &
ADMINISTRATION

Attendance Register 1 1
Updated
Weekly Offs mentioned
National and Festival
Holidays mentioned
Leave Register 1 0
Leave with wages
entered
Shift Roster displayed
Licenses
The following licenses are to be
updated and displayed:
1. Labour License 1 1
2. Contract Labour License 1 1
3. Dept Store license 1 0
4. Fast Food license if applicable 1 1
5. Bakery license if applicable 1 0
6. Insecticide license 1 0
7. 7 Days Exemption 1 0
8. Health License 1 1
9. PFA license 1 0
10. Stamping and Regn
Certificates if weights & measures. 1 1
11. ST and CST / Branch
Certificate. 1 0
12. OTC / Drug license 1 0
13. Music license 1 0
14. Food & Civil Supplies License 1 0
15. Liquor License where aplicable
16. APMC (If applicable) 1 0
17. Hoarding & Display Licences 1 0

STAFF DISCIPLINE (INCL.

PROMOTERS )
a) GROOMING 1 1
b) UNIFORM 1 1
c) IDENTITY CARD 1 1
d) SHOES 1 1
STAFF ROSTERING PLAN 1 1
STAFF ATTENDANCE TIME 1 1

HOUSE KEEPING STANDARDS 1 1

a) FLOOR
b) SHELF
C) PREMISES
TOTAL 25 13
 MAX POINTS
DISPLAY

PI LABELS
Lowest to Highest Prices 1 0
All SKUs updated 1 0

STACKING
Is it neat ? 1 1
FIFO 1 1

Expiry Stocks
Is there any expiry stocks in the shelf? 1 1
Are stocks being removed as per guideline? 1 1

FIFO & EXPIRY CHECK - One shelf per Gandola

(Staples,Processed Food,Beverages)
a) SHELF 1 1 1
b) SHELF 2 1 1
c) SHELF 3 1 1
d) SHELF 4 1 1
e) SHELF 5 1 1
(Give 1 point for each category)

KEY SKUs ON DISPLAY

(Check 2 end gondola display)
a) POP CHECK 1 0
b) DISPLAY STD CHECK 1 1

TOP TOP DISPLAY (CHECK FIVE BAYS) - Esp.

HWP
a) TOP 1 1 1
b) TOP 2 1 1

IMPULSE BINS
a) MERCHANDISE DISPLAY
b)PI LABEL

PROMOTIONS
Are all communications regarding
Gondolas/Bins/Alligators/Company stand there with
the store? 1 0
(Check for usage of the same after the contract
period)

Are promotions communicated to staff & updated? 1 1

(Check for any old promotion still displayed)

Are Banners & Posters in visibility? 1 1

TARGETS
Daily tracking of target is done? 1 0

Previous year's camparison done?

YVMs
Are YVMs are filed? 1 1
Responses are recorded? 1 1

House Keeping
Is there a schedule available? 1 1

Are there any litter visible during store walk? 1 1

TOTAL 23 18
Declaration
Do the number of pouches tally with the number of
declarations for the day?
Is change taken for the tills documented in the
required format?
Are monies taken for obtaining change entered in the staff cash
register at the exit?

PROCESS AUDIT
FORM FOR HYPER
STORE FORMAT
POINTSMAX

Percentage
Scored
SL NO

PROCESSES

STORE OPENING AND

1 CLOSING 6 0 0.00%

2 INDENTING 2 1 50.00%
3 RECEIVING 15 3 20.00%

4 RETURNS 10 2 20.00%

5 DISPOSAL AT STORES 10 4 40.00%

6 INVENTORY 11 0 0.00%

7 F & V STOCKS 11 9 81.82%

8 SALES AND CASH: 39 12 30.77%

9 REPORTS 17 0 0.00%

HUMAN RESOURCE &

10 ADMINISTRATION 25 13 52.00%

11 DISPLAYS 23 18 78.26%

TOTAL 169 62 36.69%

Note:
1 Yes - Max 1 point
2 No - 0 point
3 Not Applicable - NA to
be provided in Y/N
column only. Points
not to be entered
Module 11
Lecture 19

Energy Saving in Retail Stores.

Module II
Lecture No 20

Store EBIDTA , KRA & KPI

Only a retailer who makes profit can sustain growth and continiue
to offer products and services to customer. The success of retail
depends on two key issues : the ability to manage costs and the
ability to manage assets. The first is the cost of procuring
merchandise , the second is the cost of sales and the third is the
investment in the land or the lease for the store.The ability to
manage cost is reflected in the profitability of the business.The
concept of performance measurement would be different from the
point of view of an investor as compared to that for a manager of
the business.In this module we examine the concepts of
performance from both the perspectives.
Feasibility Report
The primary tool used for assessing whether a retailer should
venture into new markets or business areas or not is a Feasibility
Report. A thorough feasibility analysis provides a lot of
information necessary for the business plan.
Typically a feasibility report comprises the following areas:
1. A description of the business
2. Market factors
3.Cost of new premises
4.Start up cost & operating expenses
5.Cost of inventory
6. Cash flow requirements
If the market analysis research indicates that business idea is
feasible , the next step is the creation of a business plan.The shorter
the cash cycle , the more working capital a business generates ,
and the less it has to borrow.
Financial performance is an indicator of the health of the
organization . Analysing financial performance is necessary for the
following reasons:
1.To help identify the gaps in the targets.
2.To identify the opportunities for improvement
3.To evaluate past and present performance.

The two basic indicators in retail of evaluating financial

performance are :
1. Profit and Loss Statement – which shows income
2. Balance Sheet – indicates the turnover

The Income Statement

The Income statement is a record of the revenues earned by an
organization and the expenses incurred or a company’s operational
performance over a particular period of time.
The chief components of an income statement are:
1. Sales
2. Cost of goods sold.
3. Gross Margin
4. The Operating Expenses
5. The Net Profit

Sales
The total money received by the retailer from the sale of
merchandise

Cost of goods sold

.Cost of goods sold is the expenses incurred by the organization for
producing the goods that is the money spent on manufacturing its
products and labor costs.

Gross margin
Gross Profit on Sales = Net Sales – Cost of Goods Sold

Operating Expenses
In retail these are the expenses incurred under following heads:
I Total Personnel Expenses
1. Gross Salary
2.Performance Linked Incentive
3.Bonus
4.Recruitment & Training
5. Outsourced staff
6.Staff Welfare

II Total Admin Expenses

1.Repairs & maintenance
2.Housekeeping
3. AMC
4.Power & Fuel
5.Communication
6.Guest House Expenses
7. Travel Expenses
8. Local Conveyance
9.Secuirity
10. Stationary

III Total Selling Expenses :

1. Packing
2. Freight
3. Shrinkage
IV Total Non Controllable ( Fixed) expenses:
1.Rent
2.Service Tax
3.CAM
4.Bank Charges
5. Insurance
6.License Fees

Net Profit
The Operating profit before Tax is the operating profit less interest
and depreciation.

Module III Lecture 21 to 25

Lecture 21

Introduction

Session Objectives:
Retail Marketing Mix
Catchment area analysis
In store and outstore promotions
Module III
Lecture 22
Marketing in Retail
Catchment area analysis : sample

Team
member
name: Kamlesh
Date of visit: 19-Feb
Area Indra
covered: nagar
Name of
locality:
House hold Appts Govt
details Type HIG MIG LIG / Flats Flats Numbers

A- Block 200 350

Nerar Lekhraj Meena
market

Commercial Dept
complexes stores
Name
Address
Dept
stores
Name
 Address

Module III
Lecture 23

In store and Outstore Promotion

Module III
Lecture 24
Objectives:
Definition of merchandising
Functions of Merchandiser

Merchandising is having the right product in the right quantity ,

available at the right place , at the right time and at the right
price.Five rights is the key to successful merchandising .
Functions of a merchandiser are the analysis , planning ,
acquisition , handling and control of the merchandise of a retail
operation.

Module III
Lecture 25

Visual Merchandising
Visual Merchandising can be termed as the orderly , systematic ,
logical and intelligent way of putting stock on the floor.It involves
SKU planning,store windows , floor displays, signs, space design,
fixtures and mannequins.
Module IV Lecture 26 to 36
Module IV
Lecture 26
Buying and Selling Process :
An Overview
By the end of this session, you will be able to :
• Explain the buying process
• Define Selling
• Explain the selling process- ODPEC
• Explain the characteristics of each stage of the ODPEC
• Explain how it relates to the buying process

Significance of Buying and Selling Process

• The buying and selling processes involve a buyer and a seller
in pursuit of exchanging a product/service for a negotiated
price

• An understanding of the buying process will help you

identify what is going on in the buyer’s mind while you are
interacting with them

• Your success as a sales professional depends on your ability

to identify needs and motivation of the customer and propose
the appropriate solution

Module IV
Lecture 27

The Selling Process - ODPEC

Open a Sale
Develop Sale
Propose a Solution
Eliminate Doubts
Close a Sale
Characteristics – Open a Sale
• Opening a channel of communication between the buyer and
the seller by:
- Greeting the customer

- Building a rapport with the customer

Characteristics – Develop Sale
• Identifying the customers need and convincing them that
your product/service will solve their purpose

• Understand needs clearly

• In case it is a weak need, help the customer recognise the

need better

Characteristics – Propose a Solution

• Propose a solution that best fits the customer needs
budgets and buying criteria

• Share how your product can fulfil the customers’s needs and
help solve his problems

• Suggest and help the customer to make a decision

• Always demonstrate the actual product to the customer

Characteristics – Close the Sale

• Your customer is now ready for the purchase

• Suggest add-ons to increase the value of the sale

 • Always check with the customer before raising the invoice

Module IV
Lecture 28

The Buying Process - REED

• R ecognise Need
• E valuate Options
• E liminate Doubts
• D ecide

THE BUYING PROCESS

Characteristics – Recognising the Need

• The stage where the customer recognises the need for a

product or service
• Need is a problem in the existing situation

Characteristics – Evaluating Options

• Explore all the possible options

• Evaluate various options and narrow down to one option
• In small value products, like daily products the evaluating
option stage is usually not as complicated or as long as for a
large value product

Characteristics – Eliminating Doubts

 • Customer tries to bring down these risks by eliminating
all the doubts related to the product

• It is only when these doubts are eliminated that you are

ready for the final decision

• Buyer seeks reassurance by checking out the product and its

credibility

Characteristics - Deciding
• Customer decided to purchase , pays for the product , and
takes the delivery

Value of Sale – REED Process

• The amount of time that a person spends in the REED

process depends on the value of the need

• For low value purchases like vegetables or choclates, the

amount of involvement in the purchase and risk taken is
lower and hence the REED process takes place lesser than a
high-value purchase ( car , home etc. )
What is Selling ?
• Selling is the act of interacting with the customer to persuade
them to purchase a product for a negotiated price.

Module IV
Lecture 29

Role Play and Class Activity

Module IV
Lecture 30

REED - ODPEC
The two process happen together.
Recognise Need Open a Sale

Evaluate Options Develop Sale

Eliminate Doubts Propose a Solution

Decide Eliminate Doubts

Module IV
Lecture 31

Close a Sale
A quick Recap………
In this session , you learnt that:
• The buying process is called as REED Process.
• REED stands for recognise the need,evaluating
options,eliminate doubts and decide
• The amount of time that a person spends in the REED
process depends on the value of the need
• The selling process is called as ODPEC Process
• ODPEC stands for open a sale,develop sale,propose a
solution,eliminate doubts and close the sale
 • Selling is the act of interacting with the customer to persuade
them to purchase a product for a negotiated price

Module IV
Lecture 32

Customer

Session Objectives
• Define a Customer
• Define Customer Behaviour
• Identify the need to study Customer Behaviour
• Identify the factors that influence Customer Behaviour

Consumer or Customer ?

• Consumer is the one who uses the product. He/ She

influences the decision to purchase
• Customer is the one who makes the actual purchase
• Example buying shoes for a child -
- Child ( consumer)
- Parent ( customer)

Module IV
Lecture 33

Basics of Customer Behaviour

It refers to the behaviour that customers display in

 • Searching for
• Purchasing
• Using
• Evaluating
• Disposing
Off products and services that they expect will satisfy their
needs
Analysing Customer Behaviour
Factors Influencing Customer Behaviour

How would you describe the modern day retail customer ?

• What is their lifestyle and personality ?
• What age group and class do they belong to ?
• What factors influence their buying choices ?
• Where do they like to buy ?
• What is their attitude towards money ?
• What type of buying experience do they prefer ?
•
Answer: Retail Customer Profile
• Huge and expanding numbers in all age groups,classesand
location; huge potential for kid’s merchandise
• Ever changing preferences of customers;short lifespan of
trends
• Unique needs,personalities and lifestyle
• Highly diversified choices and tastes
• Lack of time but high on buying power
• Need personalised experience
• Value privacy and specialised products
• Increasing number of young customers; experimental hence
no brand loyalty
• Highly aware of customer rights
• Individualistic in taste

A Quick Recap…….
 • A Consumer is one who uses the product and a customer is
one who purchases a product
• Customer Behaviour refers to the study of
what,why,when,where and how customers make purchases
and how often they use the product
• It is important to study customer behaviour to design
effective marketing and selling strategies
• Customer Behaviour is influenced by social,personal and
psychological factors

Module IV
Lecture 34

Defining Customer Satisfaction and Customer Service

Session Objectives
By the end of this session , you’ll be able to :
• Define customer service
• Identify the characteristics of good service
• Define loyalty and see how loyal customers build business
• Define customer delight
• Identify the role of a customer service executive in ensuring
customer delight

Definition of Customer Service

• Customer Service is identifying customer expectations and
meeting them in a way that the customer wants it.

What does a Customer expect in terms of service ?

Good Service Should Be :

 • Timely – means to be on time every time

• Competence – refers to having the product knowledge,

process knowledge and skilled people involved in providing
the service

• Problem Free – means giving right and complete information

On Target Every time !

What is Customer Focus ?

• Customer focus means a way to do business as the customer

needs it

• Its goal is not customer’s needs being ocassionally satisfied

or met but instead it is “ To create a positive experience that
consistently and predictably meets and exceeds customer
expectations …. Each time every time ”

Why Customer Focus ?

Manufacturer
Is looking to differentiate himself from the competition

The customer is now becoming the focus of business.He is the

king

Customer is our Business !

• To make sure that we succeed in what we are doing: selling
our products and ideas
 • Remember the customer is KING.If the customer does not
buy, we are out of business
• To know who our customer is and what do they expect from
us
• Retail business deals with a lot of customers with diverse
interests and each needs different treatment

Satisfaction Vs Dissatisfaction

Towards Customer Delight

• Unless you exceed customer satisfaction, which means they
are not just satisfied but are excited about what you are doing
– you have to improve

Good Service Indicators: Role of a Customer Service Executive

• Helping
• Assisting
• Providing Expertise
• Guiding
• Giving Advice
• Solving Problems
• Giving Satisfaction
• Listening Intently
• Educating / Informing
A Quick Recap….
• Customer service is identifying customer expectations and
meeting them in a way that the customer wants it
• Its goal is not customer’s needs being ocassionally satisfied
or met but instead it is “ To create a positive experience that
consistently meets and exceeds customer expectations….”
• Companies that are “ customer-focussed ” build their
systems,processes and people around customer delight
• Customer-focussed employee understand the customers and
what they expect
Module IV Lecture 35
Complaint Handling
What is a Complaint ?
• A Complaint is any communication,verbal or written
conveying dissatisfaction about the product,its functioning
and any organisational activity relating directly or indirectly
with the customer’s experience of the product

Why Complaints Occur ?

Complaints Occur when

• There is a perception of the customer that the product is not
functioning satisfactorily
• There is a mismatch between expectations from the
product/service and its performance
• Commitments made are not kept by the organisation
• There is a lack of response from any customer support
department
• The service is substandard or there is a performance
breakdown
And many other reasons

Module IV
Lecture 36

Role Play and class Activity

THANK YOU

ANUJ GUPTA
FACULTY
RETAIL MANAGEMENT
HIHT