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1.1 Introduction
Retailing is the most active and attractive sector of last decade. While the retailing
industry itself has been present since ages in our country, it is only the recent past that it has
witnessed so much dynamism. Indian retailing today is at an interesting crossroads. The
retail sales are at the highest point in history and new technologies are improving retail
productivity there are many opportunities to start a new retail business. There are just over a
6 million retail outlets operating across the Indian cities from north to south and from east to
west. This large number of outlets, many of which are trying to serve and satisfy the same
market segments, results in fierce competition and better values for shoppers.

The retail mix is the combination of factors retail used to satisfied customer needs
and influences their purchase decision. It’s include the type of merchandise and services
offered, merchandise pricing, advertising, promotional programs store design merchandise
display, assistance to customer provided by salespeople, and convenience of the store’s
location.

Biggest challenge for organized retailing is to create a “customer-pull” environment

that increases the amount of impulse shopping. Research shows that the chances of senses
dictating sales are up to 10-15%. Due to which there is emergence of discount stores which
is expected to spearhead the organized retailing revolution.

The title of the project is “Effectiveness of Retailing Mix for Customer

Satisfaction at Big Bazaar” which the researcher has carried out, as retail mix greatly
influences the customer satisfaction level and the customer perception towards that store. It
is one of the hot issue in todays retail competition world which is very important for all the
retail store to follow that.

This study was done to know if customers are really satisfied with the present
retaling mix in the Big bazaar and also to find out how the store envirnoment influences the
shopping behaviour of the customer to know how the store environment can be improved.

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1.2 Rationale of the study

The project is all about to determine the satisfaction level of the customers from the
store environment and analyze the impact of retailing mix on the customer satisfaction level,
and to improve the store environment to increase the sales and to attract the customers, this
study helps to improve the environment of the store to reach the customer satisfaction level
and improve the merchandising in Big Bazaar.

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2.1 Introduction

The word "Retail" originates from a French-Italian word. Retailer is someone who
cuts off or sheds a small piece from something. Retailing is the set of activities that markets
products or services to final consumers for their own personal or household use. It does this
by organizing their availability on a relatively large scale and supplying them to customers
on a relatively small scale. Retailer is a Person or Agent or Agency or Company or
Organization who is instrumental in reaching the Goods or Merchandise or Services to the
End User or Ultimate Consumer.

2.2 Indian Retail Industry:

Indian retail industry is the largest industry in India, contributing to over 13% of the
country's GDP. Organized retail industry in India is expected to rise 35% yearly being
driven by strong income growth, changing lifestyles, and favorable demographic patterns.
It is expected that by 2011-12 modern retail industry in India will be worth US$ 590 billion.
It has further been predicted that the retailing industry in India will amount to US$ 833
billion by 2013 and US$ 1.3 trillion by 2018. Shopping in India has witnessed a revolution
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with the change in the consumer buying behavior and the whole format of shopping also
altering. Industry of retail in India which has become modern can be seen from the fact that
there are huge shopping centers, malls and sprawling complexes which offer food,
shopping, and entertainment all under the same roof. Indian retail industry is expanding
itself most aggressively; as a result a great demand for real estate is being created. Indian
retailers preferred means of expansion is to expand to other regions and to increase the
number of their outlets in a city.

In the Indian retailing industry, food is the most dominating sector and is growing at
a rate of 9% annually. The branded food industry is trying to enter the India retail industry
and convert Indian consumers to branded food. Since at present 60% of the Indian grocery
basket consists of non- branded items. Indian retail industry is progressing well and for this
to continue retailers as well as the Indian government will have to make a combined effort.
Indian retailing industry has seen phenomenal growth in the last five years. Organized
retailing has finally emerged from the shadows of unorganized retailing and is contributing
significantly to the growth of Indian retail sector. The “India Retail Sector Analysis report
helps clients to analyze the opportunities and factors critical to the success of retail industry
in India.

Indian retail industry is going through a transition phase. Most of the retailing in our
country is still in the unorganized sector. The spread out of the retails in US and India shows
a wide gap between the two countries. Though retailing in India is undergoing an
exponential growth, the road ahead is full of challenges.

2.2.1 Key Challenges:

 Location:

"Right Place, Right choice" Location is the most important ingredient for any
business that relies on customers, and is typically the prime consideration in a
customers store choice. Locations decisions are harder to change because retailers
have to either make sustainable investments to buy and develop real estate or
commit to long term lease with developers. When formulating decision about where
to locate, the retailer must refer to the strategic plan:

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 o Investigate alternative trading areas.
o Determine the type of desirable store location
o Evaluate alternative specific store sites

 Merchandise:
The primary goal of the most retailers is to sell the right kind of merchandise.
Merchandising consists of activities involved in acquiring particular goods and
services and making them available at a place, time and quantity that enable the
retailer to reach its goals. Merchandising is perhaps, the most important function for
any retail organization, as it decides what finally goes on shelf of the store.

 Pricing:
Pricing is a crucial strategic variable due to its direct relationship with a firm's goal
and its interaction with other retailing elements. The importance of pricing decisions
is growing because today's customers are looking for good value when they buy
merchandise and services. Price is the easiest and quickest variable to change
 Target Audience:

"Consumer the prime mover" "Consumer Pull", however, seems to be the most
important driving factor behind the sustenance of the industry. The purchasing
power of the customers has increased to a great extent, which is influencing the retail
industry to a great extent, a variety of other factors also seem to fuel the retailing
boom.

2.2.2 Scale of Operations:

Scale of operations includes all the supply chain activities, which are carried out in
the business. It is one of the challenges that the Indian retailers are facing. The cost of
business operations is very high in India.

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 Size 2008 2010 Percentage
Change

Estimated size of retail in India (in $bn) 353 416 18%

Share of organized retail (%) in India 7 12 71%

Figure 2.1 Size Of Indian Retail

2.3.1 Indian retail types

 Malls
 Branded stores
 Specialty stores
 Departmental stores
 Super markets
 Discount stores
 Hyper markets
 Shopping markets
 Convenient stores

 Malls:
The largest form of organized retailing today Located mainly in metro cities,
in proximity to urban outskirts. Ranges from 60,000 sq ft to 7,00,000 sq. ft. and above. They
lend an ideal shopping experience with an amalgamation of product, service and
entertainment, all under a common roof. Examples include Shoppers Stop, mega Mart,
Pantaloon, Wall mart etc.

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 Specialty Stores:

Chains such as the Bangalore based Kids Kemp, the Mumbai books retailer
Crossword, RPG's Music World and the Times Group's music chain Planet M, are focusing
on specific market segments and have established themselves strongly in their sectors.

 Discount Stores:

As the name suggests, discount stores or factory outlets, offer discounts on the
MRP through selling in bulk reaching economies of scale or excess stock left over at the
season. The product category can range from a variety of perishable/ non perishable goods.

 Department Stores:

Large stores ranging from 20000-50000 sq. ft, catering to a variety of

consumer needs. Departmental stores further classified into localized departments such as
clothing, toys, home, groceries etc. Departmental Stores are expected to take over the
apparel business from exclusive brand showrooms. Among these, the biggest success is K
Raheja's Shoppers Stop, which started in Mumbai and now has more than seven large stores
(over 30,000 sq. ft) across India and even has its own in store brand for clothes called Stop!.

 Marts/Supermarkets:

Large self service outlets, catering to varied shopper needs are termed as
Supermarkets. These are located in or near residential high streets. These stores today
contribute to 30% of all food & grocery organized retail sales. Super Markets can further be
classified in to mini supermarkets typically 1,000 sq ft to 2,000 sq ft and large supermarkets
ranging from of 3,500 sq ft to 5,000 sq ft. having a strong focus on food & grocery and
personal sales.

 Convenience Stores:

These are relatively small stores 400-2,000 sq. feet located near residential
areas. They stock a limited range of high-turnover convenience products and are usually

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open for extended periods during the day, seven days a week. Prices are slightly higher due
to the convenience premix

2.3.2 Traditional Retail Scene in India

India is the country having the most unorganized retail market. Traditionally the
retail business is run by Mom & Pop having Shop in the front & house at the back. More
than 99% retailers function in less than 500Sq.Ft of area. All the merchandise was
purchased as per the test & vim and fancies of the proprietor also the pricing was done on ad
hock basis or by seeing at the face of customer. Generally the accounts of trading & home
are not maintained separately. Profits were accumulated in slow moving & non-moving
stocks which were to become redundant or consumed in-house. Thus profits were vanished
without their knowledge. The Manufactures were to distribute goods through C& F(Carry
and Forward) agents to Distributors & Wholesalers. Retailers happen to source the
merchandise from Wholesalers & reach to end-users. The merchandise price used to get
inflated to a great extent till it reaches from Manufacturer to End-user. Selling prices were
largely not controlled by Manufacturers. Branding was not an issue for majority of
customers. More than 99% customers are price sensitive & not quality or Brand Sensitive at
the same time they are Brand conscious also.

Weekly Bazaar in many small towns was held & almost all the commodities were on
the scene including livestock. Bargaining was the unwritten law of market. Educational
qualification level of these retailers was always low. Hence market was controlled by
handful of distributors &/or Wholesalers. Virtually there was only one format of retailing &
that was mass retail. Retailer to consumer ratio was very low, for all the categories without
exception. Varity in terms of quality, Styles were on regional basis, community based &
truly very low range was available at any given single place. Almost all the purchases /
(buying) by mass population was need oriented & next turn may be on festivals, Marriages,
Birthdays & some specific occasions. Impulsive buying or consumption is restricted to food
or vegetables etc. Having extra pair of trousers or Shirts or Casuals & Formals & leisure
wear & sports wear & different pair of shoes for occasions is till date is a luxury for
majority population except for those living in Metros.

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 Purchasing power of India urban consumer is very low and that of Branded
merchandise in categories like Apparels, Cosmetics, Shoes, Watches, Beverages, Food,
Jewellery, are slowly seeping into the lifeline of Indian City folks. However electronic &
electrical home appliances do hold appropriate image into the minds of consumers. Brand
name does matter in these white goods categories. In the coming times also majority of
organized retailers will find it difficult to keep balance with rest of the unbranded retail
market which is very huge. Retailing consists of those business activities involved in the
sale of goods and services to consumers for their personal, family, or household use.
Retailing comprises of four elements customer orientation, coordinated effort, value-driven,
and goal orientation.

Figure 2.2 Evolution of Indian Retail (estimated)

2.3.3 Drivers of change in retailing

 Changing demographics and industry structure

 Expanding Computer technology

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  Emphasis on lower cost and prices
 Emphasis on convenience and service
 Focus on productivity
 Added experimentation
2.3.4 Essentials of Retailing

Customer orientation- The retailer makes a careful study of the needs of the customer and
attempts to satisfy those needs.

Goal orientation – The retailer has clear cut goal and devises strategies to achieve those
goals.

Value driven approach- the retailer offers good value to the consumer with merchandise
having the price and quality appropriate for the target market.

Coordinated efforts- Every activity of the firm is aligned to the goal and is designed to
maximize its efficiency and deliver value to the consumer

2.4 Organized Retail is evolving with changing customer aspirations

Organized retailing in most economies has typically passed through four distinct
phases in its evolution cycle. In the first phase, new entrants create awareness of modern
formats and rise consumer expectations. In the second phase consumers demand modern
formats as the markets develop – thereby leading to strong growth. As with the life cycle in
any industry, the high rate of growth would lead to a stage where the market would reach
maturity and all the players would strengthen their positions. This will be followed by the
final phase where the market would reach saturation, the growth would be limited and for
sustainable growth, retailers would explore new markets as well as evaluate inorganic
opportunities.

2.4.1 Growth Factors in Indian Organized Retail sector:

The growth factors in India organized sector are various but it is mainly due to the
fact that India's economy is booming. Also, the rise in the working population which is
young, pay- packets which are hefty, more nuclear families in urban areas, rise in the

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number of women working, more disposable income and customer aspiration, western
influences and growth in expenditure for luxury items. All these are the factors for the
growth in Indian organized retail sector.

According to the Icrier report, the retail business in India is estimated to grow at
13% from $322 billion in 2006-07 to $590 billion in 2011-12. The unorganized retail sector
is expected to grow at about 10% per annum with sales expected to rise from $ 309 billion
in 2006-07 to $ 496 billion in 2011-12. With over 1,000 hypermarkets and 3,000
supermarkets projected to come up by 2011, India will need additional retail space of
700,000,000 sq ft (65,000,000 m2) as compared to today. Current projections on
construction point to a supply of just 200,000,000 sq ft (19,000,000 m2), leaving a gap of
500,000,000 sq ft (46,000,000 m2) that needs to be filled, at a cost of US$15–18 billion.

Many Indian companies have entered the retail industry in India and this is also
a factor in the growth of Indian organized retail sector. Reliance Industries Limited is
planning to invest US$ 6 billion in the organized retail sector in I India by opening 1500
supermarkets and 1000 hypermarkets. Bharti Telecoms is planning a joint venture worth £
750 million with Tesco a global retail giant. Pantaloons are planning to invest US$ 1 billion
in order to increase its retail space to 30 million square feet. Such huge investment is also a
factor in the growth of the organized retail sector in India.

The world's largest retailer by sales, Walmart Stores Inc and Sunil Mittal's
Bharti Enterprises have entered into a joint venture agreement and they are planning to open
10 to 15 cash-and-carry facilities over seven years, Carrefour the world’s second largest
retailer by sales, is planning to setup two business entities in the country one for its cash-
and-carry business and the other a master franchisee which will lend its banner, technical
services and know how to an Indian company for direct-to-consumer retail. The world’s
fifth largest retailer by sales, Costco Wholesale Corp (Costco) known for its warehouse club
model is also interested in coming to India and waiting for the right opportunity. Tesco Plc.,
plans to set up shop in India with a wholesale cash-and-carry business and will help Indian
conglomerate Tata group to grow its hypermarket business. The factors for growth in
Indian organized retail sector are many and that’s the reason behind its massive growth, but
for this to continue both the Indian retailers and the government will have to work together.

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2.4.2 Penetration of Organised Retail

Figure 2.3 Penetration of Organized Retail

2.4.3 Indian Organized Retail Sector's Impact on Lifestyles

The Indian organized retail sector's impact changed the lifestyle of the Indian
consumers drastically. The evident increase in consumerist activity is colossal which has
already chipped out a money making recess for the Indian organized retail sector. With the
onset of a globalized economy in India, the Indian consumer's psyche has been changed.
People have become aware of the value of money.

Now a days the Indian consumers are well versed with the concepts about quality of
products & services. These demands are the visible impacts of the Indian organized retail
sector. Since the liberalization policy of 1990, the Indian economy, and its consumers are
getting whiff of the latest national & international products with the help of print &
electronic media. The social changes with the rapid economic growth due to trained

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personnel’s, fast modernization; enhanced availableness of retail space is the positive effects
of Liberalization.

The growth factors of organized retail in India are:-

 Increase in per capita income which in turn increases the household consumption
 Demographical changes and improvements in the standard of living Change in
patterns of consumption and availability of low-cost consumer credit
 Improvements in infrastructure and enhanced availability of retail space
 Entry to various sources of financing

The non-food sector, segments comprising apparel, accessories, fashion, and lifestyle
felt the significant change with the emergence of new stores formats like convenience
stores, mini Marts, mini supermarkets, large supermarkets, and hyper marts. Even food
retailing has became an important retail business in the national arena, with large format
retail stores, establishing stores all over India. With the entry of packaged foods like MTR,
ITC Ashirbad, fast foods chains like McDonald's, KFC, beverage parlors’ like Nescafe, Tata
Tea, Café Coffee and Barista, the Indian food habits has been altered. These stores have
earned the reputation of being 'super saver locations'.

India will be a unique business arena in whole of the global economy, for the social and
economic parameters would overrule the big bang of the vivid competition. Previously
mastered by the unorganized retail sector, India opened up late as an economy in 1990 until
then the idea of retail formats were spread by the government.

2.4.4 Employment Generation by India Organized Retail Sector

Lots of employment generation by Indian Organized Retail Sector in the near future.
India is going through a radical economic change. Though it is very infant stage, people can
feel the climate is changing. The unorganized retailers take the lion's share in the Indian
retail sector, but the organized retailers are growing at a good pace, and promise an increase
of proportion of by 2016. This is to be the largest sector after the agricultural sector. The
increase in the number of consumers twinned with the introduction of organized sector has
brought numerous corporate investments in retail sector. The entry of super markets,

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enormous departmental stores, and shopping malls has encouraged the retailers to look at
new business plans of expansion. An economic growth on a monumental scale is offered by
the Indian retail sector, equally in the national and international market which in turn will
generate a huge source of employment and a variety of options for the consumers. The Ernst
& Young's report 'The Great Indian Retail Story', anticipates that the Indian retail sector
would come up with 2 million employment opportunities within the year 2010.

Benefits to the economic growth:-

 Better quality products and services would lead to better competition

 More exports bring more foreign direct investments

 Organized Indian retail sector would encourage tourism

 Along with the employment boom there would be a vast development in the
expertise of the human resource

 There would remain future scope for improvements in agriculture, small, and
medium scaled with the help of the Indian retail sector

The present employment in the retail business is nearly 4 crores and around 20 crores
depend on this sector. There is a scope of better exposure to the international standards with
the entry of transnational companies, which in turn is encouraging more & more retail
management programs to open up and help bridging the gap of supply & demand of talented
professionals for management.

2.4.5 Scope of the Indian Retail Market:

The scope of the Indian retail market is immense for this sector is poised for the
highest growth in the next 5 years. The Indian retail industry contributes 13% of the
country’s GDP in the Indian retail market the scope for growth can be seen from the fact
that it is expected to rise to US$ 590 billion in 2011-12 from US$ 309 billion in 2006-07.

The organized retailing sector in India was only 7% in 2008 and is expected to rise
to 25-30% by the year 2016. There are under construction at present around 325
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departmental stores, 300 new malls, and 1500 supermarkets. This proves that there is a
tremendous scope for growth in the Indian retail market. The growth of scope in the Indian
retail market is mainly due to the change in the consumer’s behavior. For the new
generation have preference towards luxury commodities which have been due to the strong
increase in income, changing lifestyle and demographic patterns which are favorable. The
scope of the Indian retail market has been seen by many retail giants and that’s the reason
that many new players are entering the India retail industry

2.5 Major players:

 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 is 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.

 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 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
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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 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.

 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.

 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.

 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.
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  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.

2.6 Functions of retailing:

Retailers play a significant role as a conduit between manufactures, wholesalers,

suppliers, and consumers. In this context, they perform various functions like storing,
breaking bulk, holding stock, as a channel of communication, storage, advertising, and
certain additional services.

Storing:

Manufacturers usually make one or a variety of products and would like to sell their
inventory to a few buyers to reduce costs. Final consumers, in contrast, prefer a large variety
of goods and services to choose from and usually buy them in small quantities. Retailers are
able to balance the demands of both sides, by collecting an assortment of goods from
different sources, buying them in sufficiently large quantities, and selling them to
consumers in small units.

The above process is referred to as the storing process. Through this process, retailers
undertake activities and perform functions that add to the value of the products and services
sold to the consumer. Supermarkets in the US offer, on an average, 15,000 different items
from 500 companies. Customers are able to choose from a wide range of designs, sizes, and
brands from one location. If each manufacturer had a separate store for its own products,
customers would have to visit several stores to complete their shopping. While all the
retailers offer an assortment, they specialize in types of assortment offered and the market to
which the offering is made. Westside provides clothing and accessories, while a chain like
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nil irises specializes in food and bakery items. Shoppers stop targets the elite urban class,
while pantaloons is targeted at the middle class.

Breaking bulk:

Breaking bulk is another function performed by retailing. The word retailing is derived
from the French word retailer, meaning to cut a piece of. To reduce transportation costs,
manufacturers and wholesalers typically ship range cartons of the products, which are then
tailored by the retailers into smaller quantities to meet individual’s consumptions needs.

Holding stock:

Retailers also offer the service of holding stock for the manufacturers. Retailers
maintain an inventory that allows for instant availability of the products to the consumers. It
helps to keep prices stable and enables the manufacturer to regulate production. Consumers
can keep a small stock of products at home as they know that this can be replenished by
their retailer and can save on inventory carrying costs.

Additional Services:

Retailers ease the change in ownership of merchandise by providing services that

make it convenient to buy and use products. Providing products guarantees, after-sales
services and dealing with consumer complaints are some of the services that add value to
the actual product at the retailers end. Retailers also offer credit and hire- purchase facilities
to the customers to enable them to buy a product now and pay for it later. Retailers fill
orders, promptly process, deliver and install products. Salespeople are also employed by
retailers to answer queries and provide additional information about the displayed products.

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3.1 Introduction:

Pantaloon Retail India Ltd (PRIL) has emerged as the leading retailer in India with
its chain of Pantaloon, Big Bazaar and Food Bazaar stores. With the right mix of
management capabilities, high growth product profile, well-developed strategy and
extensive IT and logistics capabilities, PRIL has ensured rapid growth. More importantly,
while most organized retailers are struggling to be in back, PRIL has demonstrated a
consistent track record of profitable growth.

3.1.1 Company Research

PRIL has chalked out an aggressive expansion plan to increase its retail space to
over 17,40,000 sq.ft. over the next two years. Space for additional 4 Pantaloon’s, 11Big
Bazaars and 2 Food Bazaar’s has already been finalized, and these would be Operational
over the next two years. PRIL aims to set up over 30 Food Bazaar’s and is scouting for
appropriate locations for the same. After popularizing the concept of hypermarket in India,
PRIL is now also setting up a new format shopping mall in the country under the name
‘Central’. The format would be on the lines of a Selfridhes in London or a Central Mall in
Bangkok. Two malls of 100,000 and 240,000 sq.ft. are being set up in Bangalore and
Hyderabad respectively.

 Diversity of product range will ensure profitable volume growth

To achieve better return on retail space, PRIL uses certain product categories as
margin managers and certain product categories to generate traffic. The food and groceries
business will act as key volume growth driver while high share of apparel (which account
for over 80% sales in Pantaloon Stores and 40% in Big Bazaar) will enable PRIL to
maintain high margins. The management has demonstrated its ability to improve stock
turnovers in both the formats successfully, which has enabled significant margin
improvement.

 Fully integrated value chain and own labels give competitive edge

PRIL has a completely integrated value chain in apparels from fabric manufacturing
to apparel manufacturing, branding, distribution to retailing. The company controls the total
value chain from yarn to apparel retailing and gives a competitive edge in terms of speed of

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delivery; lower inventory carrying costs and better realizations. Also, large part of PRIL’s
apparel revenues comes from own private labels. PRIL has developed significant
competencies in apparel branding over a period of time and has developed own labels (John
Miller, Shrishti, Bare, Annabelle, AFL) in all the apparel product categories. Worldwide,
private labels give higher margin to retailers than the national brands.Also growth of private
labels is faster as retailer controls shelf space and visibility. Other initiatives such as faster
turnover of stocks by introducing 6 seasons in a year (against 2 earlier) has helped in
bringing down inventory levels and at the same time providing wider choice to customer
and improving frequency of customer visits.

 High scalability of business model- multiplier effect will set in

Size and scale drive economies on procurement and lower logistics costs, which enables
a retailer to deliver better value to customers. The hyper-market format has much higher
scalability as compared to the pure apparel-retailing format. Also, the potential to expand
and scale is virtually unlimited in the food & grocery segment, where efficiencies improve
dramatically with scale as the multiplier effect sets in. Food constitutes the largest
expenditure item (estimated at over 50%) of an average Indian’s monthly personal
expenditure. However, the share of modern retail formats in the Rs6700bn Food & Grocery
market is a minuscule 0.3%, revealing the high growth potential in the segment.

 New product categories and innovative tie-ups to aid growth

PRIL offers large number of products to the customer to give them better choice for
selection. Different product categories have different depth and width in merchandise
offering. Besides, PRIL has tied up with Shop-in-Shop partners in its Big Bazaar stores.
Some product categories where the company does not have core competency or does not
want to invest, but would attract customers are catered through these partners. Eventually, in
the long run, the Company may manage some of these product categories on its own as
volumes grow and it develops competencies in these businesses. Shop-in-Shop partners
typically pay a fixed rental for their space and share a part of their profits. By expanding the
range of product offerings and retail formats, PRIL today has been able to target a much
larger share of the consumer’s basket (about 70% as against less than 8% in 1994). PRIL
will be adding new product categories to its business in both Pantaloons as well as Big
Bazaar stores. Gold, Investment products, White goods and Appliances, Footwear will be
24
the new product categories that will be added. These product categories will help in
improving Walk In’s into its stores and generate additional business from the existing
categories too.

 Competition from global players would pose a major threat

Most global retailing majors have been keen on entering into the huge untapped
Indian market. However policy restricts Direct Foreign Investment in the sector. There is a
high likelihood of the Government lifting restriction on FDI into the retail sector in the near
future. Entry of these foreign giants - with significant experience and skills in retail
management would increase competition for PRIL. However, we believe that given the
widely dispersed and heterogeneous nature of Indian markets, a foreign entrant would find it
extremely difficult to establish a national presence. Pantaloon with its early mover
advantage and understanding of local markets is well entrenched to retain high customer
share.

Pantaloon Retail (India) Limited (PRIL) was incorporated on October 12, 1987 as
Menz Wear Private Limited under the stewardship of Mr. Kishore Biyani. It was converted
into a public limited company in September, 1991. The company sold branded garments
under Pantaloon, Bare and John Miller brands. PRIL set up its first menswear Pantaloon
Shoppe outlet in 1993. The company’s name was changed to Pantaloon Retail (India)
Limited in 1999, when it made a full-fledged entry into the retail segment through the
Pantaloons Family Store.

25
3.2 Pantaloon Retail (India) Ltd: A Company Snapshot

Business Description:

Pantaloon Retail (India) Ltd. The Company's principal activity is to operate chain
retails stores in names of Big Bazaar, Food Bazaar, Central and Pantaloons. The Big Bazaar
is the discount store which offers a wide range of products under one roof. The products
include apparels and non-apparels such as utensils, sports goods and footwear. The
Company also has its presence into gold retailing by launching Gold Bazaar. The
Company's Food Bazaar provides a range of food and grocery products ranging from fresh
fruits and vegetables, staples, FMCG products and ready-to-cook products. The Central
offers a chain of stores including books and music stores, global brands in fashion, sports
and lifestyle accessories, grocery store and restaurants. The Pantaloon retail stores focus
largely apparels and accessories.

About Pantaloon Retail (India) Ltd

Pantaloon Retail (India) Limited is a leading retailer with a turnover of Rs. 1088
crores for the financial year ending June 2008. The company is headquartered in Mumbai
and has a presence in Lifestyle Retailing through 18 Pantaloons Stores, 3 Central Malls in
Bangalore, Hyderabad and Pune. In Value Retailing it is present through
24 Big Bazaar hypermarkets, 38 Food Bazaars and 2 Fashion Stations. PRIL has a national
presence with 2.6 million square feet of retail space across 24 cities.

26
3.2.1 Pantaloon: Fashion by Pantaloon

Pantaloon is the company's departmental store and part of life style retail format. In
fact, PRIL took its very initial steps in the retail journey by setting up the first Pantaloon
store in Kolkata in 1997. In a short time Pantaloon has been able to carve a special place for
it self in the hearts and minds of the aspirational Indian customers. The company has depth
of offering for both men and women at affordable prices. A striking characteristic of
Pantaloon has been the strength of its private label programme. John Miller, Ajile.
Scottsvile, Lombard, Annabelle are some of the successful brands created by the company.
With 13 stores across the country and an ever-increasing stable of private brands, Pantaloon
- in the coming years is poised to become a leading fashion trendsetter.

3.2.2 Big Bazaar: Is se sasta aur acha kahin nahin

Big bazaar is the company’s foray into the world of hypermarket discount stores, the
first of its kind in India. Price and the wide array of products are the USP’s in Big Bazaar.
Close to two lakh products are available under one roof at prices lower by 2 to 60 per cent
over the corresponding market prices. The high quality of service, good ambience, implicit
guarantees and continuous discount programmes have helped in changing the face of the
Indian retailing industry. A leading foreign broking house compared the rush at Big Bazaar
to that of a local suburban train.

Food Bazaar’s core concept is to create a blend of a typical Indian Bazaar and
International supermarket atmosphere with the objective of giving the customer all the
advantages of Quality, Range and Price associated with large format stores and also the
comfort to See, Touch and Feel the products. The company has recently launched an
aggressive private label programme with its own brands of tea, salt, spices, pulses, jams,
ketchups etc. With unbeatable prices and vast variety (there are 42 varieties of rice on sale),
Food Bazaar has proved to be a hit with customers all over the country.

27
 Outlet 104 outlets

Located in India

Parent group Future group

Owner Kishore Biyani (CEO)

Founded 2001

Head quarter Jogeswari , Mumbai

Industry Retail

Website www.bigbazar.com

Tag line Is se sasta aur achha kahin nahi.

Figure 3.1: About Big Bazaar

Big Bazaar

Big Bazaar is a chain of shopping malls in India, owned by the Pantaloon Group and
which work on Wal-Mart type economies of scale. They have had considerable success in
many Indian cities and small towns. Big Bazaar provides quality items but at an affordable
price. It is a very innovative idea and this hypermarket has almost anything under one roof
Apparel, Footwear, Toys, Household Appliances and more. The ambience and customer
care adds on to the shopping experience.

Is Se Sasta Aur Accha Kahin Nahin !

28
What's in store for you at Big Bazaar?
1,70,000 products at 6- 60 % discount.
At Big Bazaar, you will get: A wide range of products at 6 – 60 % lower than the
corresponding market price, coupled with an international shopping experience.

3.3 Products available in Big bazaar

Apparel and Accessories for Men, Women and Children.

Baby Accessories. Toys
Cosmetics Home Textiles Luggage

Crockery Home Needs Linens

Dress Materials Suiting & Shirting Household Appliances Sarees

Electrical Accessories Household Plastics Stationery

Electronics Hardware Utensils & Utilities

Footwear Home Decor

Food Bazaar’s core concept is to create a blend of a typical Indian Bazaar and
International supermarket atmosphere with the objective of giving the customer all the
advantages of quality, Range and Price associated with large format stores and also the
comfort to See, Touch, and Feel the products. 'FOOD BAZAAR' a division of Pantaloon
Retail India Ltd is a chain of large supermarkets with a difference. It was flagged off

29
in April'02. With store sizes ranging from 8,000 sq ft to 15,000 sq. ft. in Mumbai (two
stores), Kolkata, Bangalore & Hyderabad, it is opening more stores at Gurgaon (Delhi),
New Bombay & Nagpur. It currently caters to over 1.2 million customers every day across 4
outlets in India and is soon set to expand and double this figure across 12 outlets all over the
country by June 2009. Food Bazaar offers the Indian consumer the best of Western and
Indian values.

The western values of convenience, cleanliness and hygiene are offered through pre
packed commodities and the Indian values of "See- Touch- Feel" are offered through the
“Mandi” atmosphere created by displaying staples out in the open, all at very economical
and affordable prices without any compromise on quality. This satisfies the Indian
consumer and comforts her before making her final buying decision. At other super
markets, the consumer is deprived of this factor. Truly the Indian consumer now agrees with
Food Bazaar: "Ab Ghar Chalaana kitna Aasaan”. This positioning platform of Food
Bazaar is evident from the higher discounts and the wholesale price-points which are below
MRP.

Food Bazaar represents the company’s entry into food retail and is targeted across all
classes of population, tea, sugar, pulses, spices, rice wheat etc, besides fruits and vegetables.
All products are sold below MRP and discounts range between 2% to 20%. Fruits and
vegetables are sold at prices comparable to wholesale prices. Food Bazaar replicates a local
‘mandi’, to provide the much important ‘touch & feel’ factor which Indian housewives are
used to in the local bazaar. Food Bazaar has over 50,000 stock keeping units which cover
grocery, FMCG products, milk products, juices, spices, ready to eat foods etc.

30
3.4 GROUP VISION AND MISSION:

Group Vision

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

Group Mission

 We share the vision and belief that our customers and stakeholders shall be served
only by creating and executing future scenarios in the consumption space leading to
economic development.
 We will be the trendsetters in evolving delivery formats, creating retail realty,
making consumption affordable for all customer segments – for classes and for
masses.
 We shall infuse Indian brands with confidence and renewed ambition.
 We shall be efficient, cost- conscious and committed to quality in whatever we do.
 We shall ensure that our positive attitude, sincerity, humility and united
determination shall be the driving force to make us successful.

Core Values

 Indianness: confidence in ourselves.

 Leadership: to be a leader, both in thought and business.
 Respect & Humility: to respect every individual and be humble in our conduct.
 Introspection: leading to purposeful thinking.
 Openness: to be open and receptive to new ideas, knowledge and information.
 Valuing and Nurturing Relationships: to build long term relationships.
 Simplicity & Positivity: Simplicity and positivity in our thought, business and
action.
 Adaptability: to be flexible and adaptable, to meet challenges.

31
 Flow: to respect and understand the universal laws of nature.

32
3.4.1 AWARDS AND RECOGNITION

2009 CNBC Awaaz Consumer Awards 2009, Images Fashion Forum 2009, Coca-Cola
Golden Spoon Awards 2009

2008 Indian Retail Forum Awards 2008, The INDIASTAR Award 2008 , Retail Asia
Pacific 500 Top Awards 2008, Coca-Cola Golden Spoon Awards 2008, The Reid & Taylor
Awards For Retail Excellence 2008

2007 Images Retail Awards, National Retail Federation Awards, World Retail Congress
Awards, Hewitt Best Employers 2007, PC World Indian Website Awards Reader’s Digest
Trusted Brands Platinum Awards.

2006 Retail Asia Pacific Top 500 Awards, Asia money Awards, Ernst & Young
Entrepreneur of the Year Award, CNBC Indian Business Leaders Awards, Lakshmipat
Singhania – IIM Lucknow National Leadership Awards, Images Retail Awards , Readers’
Digest Awards , CNBC Awaaz Consumer Awards, Reid & Taylor Awards for Retail
Excellence

2005 Images Retail Awards 2005, DAKS London

2004 Images Retail Awards 2004, Reid & Taylor and DLF Awards

2003 Indian Express Award

33
3.4.2 SWOT ANALYSIS:

Strengths:-

• EDLP [ Every Day Low Pricing]

• Experienced marketing team & executive staff.
• Strong culture, ethics and values are followed
• Emphasis on providing total customer satisfaction
• Point of purchase promotion to increase the purchase
• Variety of stuff under single roof
• Increase sales with the help of healthy competition between different department
• Maintains good employer-employee relation
• Cost control initiatives that is critical in a retail operations business
• Periodical reviews of the various operations have been done on regular basis to
identify the any possible threat and address the same within time

Weakness:-

• Unable to meet store opening targets.

• Unavailability of popular brand items with regard to clothing.

Opportunities:-

• Population of the country is growing where the scope of market is kept on increasing
for the retail sector.
• Organized Retail less penetrated in India so it acts as a great opportunity to the
organization for its growth.
• Evolving consumer preferences.
• Economy is developing as the employment opportunities are increasing and the
income of the people is also increasing which increases life standards of people.
• Company has more scope of expansion in two and three tier cities.

34
Threats:-
• Competitors Strategies
• Advancement of technology day by day.
• Government policies.
• Unorganized Retail sector
• Foreign direct investment cause more problems in future because of that many
mergers and acquisition are happening in Indian retail sector

3.4.3 A layout chart of Big bazaar located at PIMPERI CHINCHWAD

1. HELP DESK
2. KIDS ACCESSORIES
3. BABA SUITS
4. JACKETS
5. LADIES TOPS
6. TRIAL ROOM
7. PILLARS USED FOR DISPLAYING INFORMATION (SIZE CHART, SECTION
DESCRIPTION)
8. WOOLEN CLOTHS FOR KIDS
9. KIDS CASUAL WEAR
10. KIDS JEANS AND SHORTS
11. LADIES ETHINIC
12. LADIES ACCESSORIES – LINGERIES
13. LADIES WESTERN
14. MEN FORMAL SHIRTS
15. MEN TROUSERS
16. MEN SUITS AND BLAZERS
17. MEN FABRICS
18. MEN ETHINICS
35
19. SOFT TOYS
20. MEN ACCESSORIES – SUNGLASSES, WRIST WATCHES ETC
21. HOME DECORATIVE ITEMS
22. HOME FURNISHING (CURTAIN CLOTHS, CARPETS)
23. MUSIC COUNTER
24. LUGGAGE
25. FOOTWEAR
26. SPORTS
27. SCHEME BASED PROMOTIONAL ITEMS
28. FURNITURE BAZAR
29. FOOD BAZAAR
30. CASH COUNTER

36
37
38
4.1 Retail Mix

The retail mix is the combination of factors retail used to satisfied customer needs
and influences their purchase decision. It’s include the type of merchandise and services
offered, merchandise pricing, advertising, promotional programs store design merchandise
display, assistance to customer provided by salespeople, and convenience of the store’s
location.

 Retail mix is the term used to describe the various elements and methods required to
formulate and execute retail marketing strategy.
 Retail managers must determine the optimum mix of retailing activities and
coordinate the elements of the mix.
 The aim of such coordination is for each store to have a distinct retail image in
consumers mind.
 The mix may vary greatly according to the type of the retailer is in, and the type of
product/services.
While many elements may make up a firm’s retail mix, the essential elements may include:
 Store location,
 merchandise assortments
 Store ambience,
 customer service,
 price,
 Communication with customer
 Personal selling
 Store image
 Store design
 Sales incentives
 People
 Process
 Physical evidence

39
4.1.1 Composition of retail mix
 Place
 Product
 Price
 Promotion
 People
 Process
 Physical Environment
Key element
Table 4.1: Composition of Retail Mix

1) Place (store location) 2) Product (merchandise)

• Target market
• Channel structure
• Channel management
• Retailer image Retail logistics
• Retail distribution
• Product development
• Product management
• Product features and benefits
• Branding
• Packaging

3) Price 4) Promotion
• Costs
• Developing promotional mixes
• Profitability
• Advertising management
• Value for money
• Sales promotion
• Competitiveness
• Sales management
• Incentives
• Public relations
• Quality
• Direct marketing
• Status
• After-sales services

40
 5) People element 6) Process element

• Staff capability • Order processing

• Efficiency • Database management
• Availability • Service delivery
• Effectiveness • Queuing system
• Customer interaction • Standardization
• Internal marketing

4.1.2 Retail mix planning

Retail mix plan consists of:
 Setting objectives
 Systematic way of identifying a range of options.
 Formulation of plans for achieving goals
 Logical sequence of retailing activities.
Importance of Retail mix planning
 Hostile and complex retail environment
 External and internal retail organisation factors interact for
· Maximising revenue
· Maximising profit
· Maximising return on investment
· Minimising costs
 Each element has conflicting needs
 All these variables interact
 All these variables result in optimum compromise.
Approaches to planning
Top down approach

41
Retail management sets goals and plans for all levels of management.
Bottom up approach
Various units prepare own goals and plans sent up for approval. It is the effective blending
of all the elements of retail mix activities within the retail organization that determines the
success of retail management. Discuss this statement and explain with retail examples how
the elements of retail mix could be blended to ensure the success of retail operation.

4.2 Retailing

Retailing is the sale of goods and services to ultimate consumers for personal, non-
business use. Any institution may engage in retailing, but a firm engage primarily in
retailing is called a retailer. Retailers serve as purchasing agents for consumer and as sales
specialists for producers and wholesaling middleman. They perform many specific activities
such as anticipating consumers' wants, developing product assortments and financing.
Retailers may be classified by form of ownership and key marketing strategies. Also, types
of retailers distinguished according to product assortment, price and customer service levels.
Mature institutions such as department stores, discount houses and super markets face
strong challenges from new competitors, particularly chain stores or multiple shops in
various product categories. Five major forms of non store retailing are Direct selling,
Telemarketing, Automatic vending, On line retailing and Direct marketing .Each type has
advantages as well as drawbacks.

4.2.1 Retail Marketing Mix

Whatever is from of ownership, a retailer must develop marketing mix strategies to succeed
in its chosen target markets. In retailing, the marketing mix emphasizes product assortment,
price, location, promotion and customer services designed to aid in the sale of a product.
They include credit, delivery, gift wrapping, product installation, merchandise returns, store
hours, parking and- very important personal service. Stores of different sizes face distinct
challenges and opportunities. Buying, Promotion, Staffing and expense control are
influenced significantly by whether store's sales volume is large or small. Size of a retail

42
business creates certain merits and demerits. Considering these factors, large stores
ordinarily but not always have a competitive advantage over small stores.

4.3 Competitive Advantage with Special Reference to Physical Facilities

Another competitive advantage of retailers will be how they create physical facilities
which represent the distribution element of a retailer's marketing mix. Some firms engage in
non-store retailing by selling on hire or through catalogs or door to door, for example-but
many more firms rely on retail stores. Firms that operate retail stores must consider four
aspects of physical facilities.

Location

It is frequently stated that there are three keys to success in retailing: Location,
Location, Location! Although overstated, this axiom does suggest the importance that
retailers attach to location. Thus a stores site should be the first decision made about
facilities. Considerations such as surrounding population, traffic and cost determine where a
store should be located.

Size

This factor means the total square footage of the physical store, not the magnitude of
the firm operating the store. These are much different factors. A firm may be quite large
with respect to total sales, but each of its outlets may be only several thousand square feet in
size.

Design

This factor refers to a stores appearance, both interior and exterior over its
competitor.

Layout

The amount of space allocated to various product lines, specific locations of

products and a floor plan of display tables and racks comprise the store's layout. As would
43
be expected, the location, size, design and layout of retail stores are based on where
consumers live and how they like to go about their shopping. Consequently, the bulk of
retail sales occur in urban, rather than rural, areas. And suburban shopping areas have
become more and more popular, where as many down town areas have declined.

Assessing Competitors Current Strategies

The first part in competitor analysis is to determine how competitors are attempting
to achieve their objectives. This question is addressed by examining their past and current
marketing strategies.

4.3.1 Marketing Strategy

Many authors have attempted to explain the concept of strategy. At the retail level, a
marketing strategy can be thought of three major components: target selection of customers,
core strategy (i.e. positioning and differential advantage), and implementation (i.e.
supporting marketing mix). The first major component is the description of the market
segment(s) to which competing brands are being marketed. Market segments can be
described in various ways. Since few brands are truly mass marketed, the key is to
determine which group each competitor has targeted. The second strategy component is
what is called the core strategy. This is the basis on which the rival is competing, that is its
key claimed differential advantage(s).Differential advantage is a critical component of
strategy because it usually forms the basic selling proposition around which the brand's
communications are formed. It is also called the brand's positioning. The final strategy
component of competitors must be assessed in the supporting marketing mix. The mix
provides insight into the basic strategy of the competitor and specific tactical decisions.
These decisions are what customers actually see in the market place. In fact, customers are
exposed to price, advertising, promotion and other marketing mix elements.

4.3.2 Marketing Environment

To the company's marketers falls the major responsibility for identifying major
changes in the environment. The retail environment, in particular is constantly spinning out
new opportunities, in bad as well as in good years. The general marketing environment also
spins out new threats-such as an energy crisis, a sharp rise in interest rates, a deep recession-
44
and firms find their markets collapsing. Recent times have been marked by many sudden
changes in the marketing environment, leading Drucker to dub it an Age of Discontinuity
and Toffler to describe it as a time of Future Shock. Retail marketers need to continuously
monitor the changing scene. They must use their intelligence and marketing research to
track the changing environment. By erecting early warning systems, retailers will be able to
revise marketing strategies in time to meet new challenges and opportunities in the
environment. It consists of the external actors and forces that affect the retailer’s ability to
develop and maintain successful transactions and relationships with its target customers. We
can distinguish between the retailers' micro environment and macro environment. The micro
environment consists of the actors in the retailer's immediate achievement that affects its
ability to serve its markets: Suppliers, intermediaries, customers, competitors and publics.
The macro environment consists of legal, social, economic and technological forces.

4.3.3 Store location and Layout

Retailers want to locate their stores in the best place possible. The best place
possible will vary from retailer to retailer depending on the industry type, type of product,
competition, and other market factors. Basically a retail store has to located where the
market opportunities are at optimal levels. There are basic guidelines that most retailers
examine before choosing a new location. First, the retailer must select a country or region
and then define the boundaries of the trade area and evaluate its population characteristics
against the retailers target market. The buying power of the area must be considered along
with its market and sales potential. The size, location, and type of competition must also be
taken into account. The local legal and political environment must be examined along with
the leasing costs and occupancy rates. The actual physical features of the location – such as
available space, traffic and access to the site, and surrounding buildings – play a role in the
selection process. Retailers possess many tools to help in the site selection decision. Reilly’s
law and Huff’s model can aid in defining the trade area. Market segmentation and
demographic segmentation provides clues to population characteristics. The buying power
index and effective buying income suggest strength of the economic base while the index of
retail saturation offers a benchmark for market comparison. Changes in consumer lifestyle
will require new strategies for selecting retailing locations, such as the increasing use of
convenience oriented sites, the integration of food and non-food retailing, and the placement
45
of retail merchandising in amusement parks. There a numerous kind of retail stores to
choose from as well. Most potential sites fall in to one of these categories: business districts,
shopping canters, and freestanding locations. There are specific advantages and
disadvantages for each type of location. The bottom line in retail site selection should be to
choose a location that will fit both today’s and tomorrow’s needs. The layout and design of
a retail store communicate a significant amount of information about the retailer to the
consumer. The architectural character of the store, building a new location, renovating
existing facilities, exterior design, interior design the modern self layout and the image of
the store are the key issues in designing a layout for a store.

4.3.4 Merchandise Management

Merchandise management can be termed as the analysis, planning, acquisition,

handling and control of the merchandise investments of a retail operation. The process of
merchandise management includes the developing of strategies to ensure that the right
product is bought at the right price and available at the right place, at the right time, in the
right amount, in order to satisfy the needs of the target customer. No one in retail can
completely avoid any contact with merchandising activities. Merchandising is the day-to-
day business of all retailers. As inventory is sold, new stock needs to be purchased,
displayed and sold. Hence, merchandising is often said to be at the core of retail
management. Merchandising traces its growth to the rise of organized retail in the world.
Initially, as the retailers operated only one or two stores, the function of buying the
merchandise, pricing it, etc., were much simpler. In many cases, the retailer did it himself.
However, as retailers started adding stores and categories, the workload on the buyers
increased significantly. Often, buyers had little information or time and they ended up using
approximations based on sales volumes, to allocate merchandise between stores. This
sometimes, resulted in stores exchanging merchandise among them!

In order to overcome this limitation, the function of a planner came into being. The
planner’s job was to act as a link between the stores and the buyer. The de-linking of the
function of planning and buying allowed better interaction with the stores. Planners were
able to devote more time to collecting and studying store level data, the buyers on the other
hand, were able to spend more time with the vendors.

46
4.4 Competitive Sales

Given widespread availability of the same brands, retailers have to cope with the
phenomenon of discounts. The retailers themselves dilute the strength of the retail market.
With promotions becoming the order of the day, they have entered into price wars against
each other. ‘Up to 50 percent off’ sales and ‘Two for one’ price offers have now become
commonplace even at the top retail outlets across our country. Every season every festival
has more price cuts. The discounted buying has become an annual market strategy rather
than a mere sales promotion for a few weeks. Deep price cuts may not be the answer to
maintain their relevance against the small retailers nor does it augur well for the brand
building of the store.

47
48
5.1 Research title:
The title of the research project is:

“Effectiveness of Retailing Mix for Customer Satisfaction at Big Bazaar.”

5.2 Research Problem:

What is effectiveness of Retailing Mix at Big Bazaar leading to Customer

Satisfaction?

5.3 Research Objective:

Primary objectives:

 To identify performance of store operations.

 To analyze how the merchandising mix influence the customer satisfaction

level.

Secondary objectives:

 To understand the quality of service maintained in the store.

 To determine the performance of sales persons in the store.

 To find out reasons of dis-satisfaction.

49
  To find out which means of communication plays a vital role to persuade customer.

5.4 Scope of study

The study makes an effort to ascertain the satisfaction level of customers from the
store environment and analyze the impact of retailing mix on the customer satisfaction level,
and to improve the store environment to increase the sales and to attract the customers.

The company can come up to the expectation only by finding out the problem that
customers are facing during their purchase from the store. The subject has been taken for the
research as it plays key role in success of retail sector. As long as the company is able to
satisfy its customer, customer will remain in the bracket of loyal customer. This study helps
to improve the environment of the store to reach the customer satisfaction level and improve
the merchandising in Big Bazaar.

50
51
6.1 Objectives of Research:

The purpose of research is to discover answers to questions through the application

of scientific procedures. The main aim of research is to find out the truth which is hidden
and which has not been discovered as yet. Though each research study has its own specific
purpose, we may think of research objectives as falling into a number of following broad
groupings:

 To gain familiarity with a phenomenon or to achieve new insights into it

(studies with this object in view are termed as exploratory or formulative
research studies);
 To portray accurately the characteristics of a particular individual, situation
or a group (studies with this object in view are known as descriptive
research studies);
 To determine the frequency with which something occurs or with which it is
associated with something else (studies with this object in view are known
as diagnostic research studies);

6.2 Research Design:

Research design is an arrangement of condition for collection and analysis of data in

a manner that aims to combine relevance to research purpose with an economy in procedure.
Research design is needed because it facilitates the smooth ailing of the various research
operations, thereby making research efficient possible yielding maximal information with
minimal expenditure. Research design used in this project is Single Cross-sectional design
where one sample is drawn from a population of interest. In this research design a cross
52
sectional study is concerned with a sample of elements from a given population. Data on a
number of characteristics from the sample elements are collected and analyzed.

6.3 Types of Research:

Exploratory research: The research is an exploratory when; one is seeking insight to

general nature of the problem, the possible alternatives and relevant variables that need to be
considered. The methods are flexible, unstructured and qualitative.

Descriptive research: It provides an accurate position of a particular aspect of the market

environment. The purpose of descriptive research is together a quantified measurement of a
specific reaction. It is structured. Most of the data that we needed are gathered in some form
of direct or indirect question which further will depend upon:

 Nature of the question

 Time frame of study

 Funds available

 Kinds of respondents

This project is totally based on survey of the market i.e. people and a lot of research on the
web, so for that a DESCRIPTIVE type of research design was used. Descriptive
research provides an accurate position of a particular aspect of the market condition.
The purpose of this research is together quantified measurement of a specific type of
reaction. It is a structure most of the data that we collected from the field are
gathered in some form of direct or indirect question.

6.4. Data Collection Methodology:

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The primary data are those, which are collected afresh and for first time and thus happen
to be original in character.

The secondary are those which have been collected by someone else and which have
already been passed through statistical process.

Data has been collected by the researcher by Primary sources such as questionnaire and
personnel interview. It included 20 questions and 100 customers were given the
questionnaire and response was taken from them. Charts and graphs will be used for
presentation of data for easy understanding and interpretation.

6.5 Data Collection Instruments:

1. Questionnaires
2. Personal Interviews.
6.5.1 Designing the Questionnaire:

While designing the Questionnaires certain things were kept in mind such as simplicity,
length and clarity.

6.5.2 Personal Interviews

Personal interview is mostly commonly used method of data collection. Two purposive
communications between interviewer (researcher) and the respondent (subject) aimed at
obtaining and recording information pertinent to the subject matter of study. The
interviewer resents oral, verbal and written stimuli and receives oral resonances.

6.6 About the Survey:

6.6.1 Survey Title: “Effectiveness of Retailing Mix for Customer Satisfaction at Big
Bazaar”.

6.6.2 Sample Universe: Big Bazaar Store

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6.6.3 Sampling Method: Non-probability sampling was used .Non-probability sampling is
that sampling procedure which does not afford any basis for estimating probability that each
item in population has being included in the sample. Under non-probability sampling
organizers of enquiry purposely select particular unit of universe for constituting a sample
on the basis of the small mass that they so select out of huge one will be typical or
representative of the whole. Adequate consideration was taken to bring a heterogeneous
group in terms of age, income, occupation etc. to make the results credible.

6.6.4 Sample Size: 100 Respondents.

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7.1 Analysis Techniques:

Time: The survey of 100 respondents was finished in two months.

Response Format:

The questions are a mix of open-ended, close-ended questions, binary, ranking and multiple
choice questions. They have been so inserted into the questionnaire, to get the appropriate
response for a particular situation.

7.2 Limitations of the study:

 Time Constraint: Analysis pertaining to project title and the field survey
has to be done in a span of two months. This may limit the scope of the
survey.

 Biasness: The respondents may give a biased view.

 Some respondents refuse to co-operate.

 Some respondents replied half heartedly.

 Some respondents gave incomplete information.

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57
7.3 Survey Results, Presentation and Inference

Effectiveness of Retailing Mix for Customer satisfaction at Big Bazaar

Question 1a): Do you frequently shop at big bazaar?

Table No.7.1: No of customer

Yes No Total

74 26 100

Figure No.7.1: No of customers

Inference:

From the above chart we can ascertain that majority of customers i.e., around 74%
of sample customers frequently visits to the store and 26% of the customer visits the store
rarely.

Question 1b): How frequently do you shop at big bazaar?

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TableNo.7.2: Customer Response

Sr.No. Response No. of customers

1. Every week 38

2. Once in two week 24

3. Once in three week 16

4. Once in month 22

Figure No.7.2: Customer Response

Inference:

From the above table we can analyze that the majority of the customers i.e. 38 out
of 100 customer visits store every week , followed by 24 customer once in two week. Thus
we can say that majority of customer visit big bazaar every week, may be during weekends.
We can conclude that the customer visit Big Bazaar for their weekly purchase.

Question 2a): What comes to your mind when you think about big bazaar?

Table.No.7.3: Unique Selling Propositions of big bazaar

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Sr.No. USP’s No. of customers

1. Discount 34

2. Product Variety 24

3. Brand 4

4. Quality 8

5. Free offer 28

6. Others 2

Figure No.7.3: Unique Selling Propositions of big bazaar

Inference:

From the data collected we can determine that among 5 USP’s of big bazaar most
recognised are discounts and free offers, along with that it also recognised for product
varieties. But they have to rethink about the brand available in the store and they have to
expand their brand availability.

Question 2b): Do you feel that you find different variety of product in Big Bazaar?

Table No.7.4: No of customer

Yes No Total

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 66 34 100

Figure No.7.4: Product Variety

Inference:

From the above chart we can asertain that upto 66% percent i.e. majority of
customers satisfied with the variety of product in the store.

Question 2c): Do you find the specific brand that; you look in the big bazaar?

Table No.7.5: No. of Customers

Yes No Total

37 63 100

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Figure No.7.5: No. of Customers

Inference:

From the above chart we can ascertain that 63% of customers find it difficult to get
specific brand. Mostly customers were not satisfied with brand availability in apparels
section.

Question 3: In which section do you spend more time while shopping?

Table No.7.6: Customer Response

Sr.No. Response No. of Customers

1. Food bazaar 36

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 2. Apparels 21

3. Utensils 28

4. Other 15

Figure No.7.6: Customer Response

Inference:

Most of the customer who visits to the Big Bazaar, would like to visit to the food
bazaar first which means it shows customer preference towards food bazaar followed by
House hold utensils section as they find more products varieties and offers in these sections.

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Question 4: Do you think this store has good parking facilities?

TableNo.7.7: Parking Facilities

Sr.No. Response No. of Customers

1. Yes 52

2. No 48

Figure No.7.7: Parking Facilities

Inference:

From the data, we conclude that still 48% of customers are not satisfied with the
parking facilities as they have to wait for long time to park their vehicle because of full
parking.

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Question 5: How is the ambiance of floor inside the store?

Table No.7.8: Store Ambiance

Sr.No. Response No. of Customers

Excellent
1. 17
Good
2. 31

3. Average 44
Bad
4. 8

Figure No.7.8: Store Ambience

Inference:

From the data collected with this question, 44 out of 100 customer to respond
about cleaning of store is ok, 8 customer’s respond is bad, 17 customer’s is excellent, and
31 customer’s respond is good, most of the customers were not satisfied with cleanliness
and temperature maintained in the store. There is need to improve cleanliness.

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Question 6: How do you feel about sales persons and promoters?

Table No.7.9: Sales persons and promoters behavior

Sr.No. Response No. of Customers

Excellent
1. 17
Good
2. 22

3. Average 29
Bad
4. 32

Figure No.7.9: Sales persons and promoters behavior

Inference:

From the above data we can conclude that 62% of customers feel the behavior of
sales person and promoters is from average to bad. Customers are not satisfied with sales
person and promoter’s behavior as there interaction is very less with customers.

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Question 7: How is billing process?

Table No.7.10: Billing Process

Sr.No. Response No. of Customers

Excellent
1. 12
Good
2. 23

3. Average 27
Bad
4. 38

Figure no 7.10: Billing Process

Inference:

From the above data we can conclude that 38% of customers are not satisfied with
billing facilities.

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Question 8: Do you feel that Big Bazaar provides you value for money?

TableNo.7.11: Value for Money

Sr.No. Response No. of Customers

1. Yes 87

2. No 13

Figure No.7.11: Value for Money

Inference:

From the above data, we come to know that majority of the customer said that
they are really getting value for there money.

“Discovering More Value”

The above statement is truly spotted by the above data

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Question 9: The cleanliness and hygiene maintained in the store is-

Table No.7.12: Cleanliness and Hygiene

Sr. No. Response No. of customers:

1. Excellent 6

2. Good 24

3. Average 38

4. Bad 32

Figure No.7.12: Cleanliness and Hygiene

Inference:

From the above data, we come to know that most of customers i.e. 70% of
customers are not satisfied with cleanliness maintained in the store.

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Question 10: Product display and signage in the store is-

Table No.7.13: Product display and Signage

Sr.No. Response No. of customers

Excellent
1. 11
Good
2. 18
Average
3. 58
Bad
4. 13

Figure No.7.13: Product display and Signage

Inference:

From the above data, we can conclude that most of customers marked product
display and signage as average to bad and expect improvement so that they can easily find
what they want.

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Question 11: Location of Big Bazaar in your city is-

Table No.7.14: Location of Store

Sr.No. Response No. of customers

Excellent
1. 38
Good
2. 31
Average
3. 9
Bad
4. 6

Figure No.14: Location of Store

Inference:

From the above data we can conclude that 69% of customers feel that location of
store is excellent to good.

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Question 12: The store layout at this store makes it easy for customers to move around the
store and find what they want?

Table No.15: Store Layout

Sr. No. Response No. of customers:

1. Strongly Disagree 13

2. Somewhat Disagree 28

3. Neutral 41

4. Somewhat Agree 11

5. Strongly Agree 7

Figure No.15;

Inference:

From the above data we can conclude that 41% of customers feel store layout is
not up to mark and still more 41% customers not able to categories as good.

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Question 13: Through which promotional source you come to know about Big Bazaar?

Table No.16: Promotional Source

Sr. No. Response No. of customers:

1. Print Media 33

2. Electronic Media 32

3. Word of Mouth 24

4. Magazine 11

Figure No. 16: Promotional Source

Inference:

From the above data we can conclude that Most of customers came to know about
Big bazaar by Electronic Media (32%) and Print Media (33%). 24% of customers came to
know by word of mouth.

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Question 14: Which type of media appeals you more for purchasing from Big Bazaar?

Table No.17: Promotional Media

Sr. No. Response No. of customers:

1. Print Media 27

2. Electronic Media 23

3. Word of Mouth 36

4. Magazine 14

Figure No.17: Promotional Media

Inference:

From the above data we can conclude that 36% customers feel word of mouth
plays a major role in their decision making.

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Question 15: How much do you think that the promotional activities help in making your
shopping beneficial?

Table No 18: Promotional Activities

Sr. No. Response No. of customers:

1. To great Extent(1) 27

2. 2 35

3. 3 24

4. 4 12

5. Not Much(5) 2

Figure No.18: Promotional Activities

Inference:

From the above data we can conclude that Promotional scheme is beneficial in
making shopping easy. 27 customers ranked it at scale of great extend. 24 believe that it is
effective where as 37 said it is most effective and need this type of information before actual
purchase.

Question 16: Which of the following service you have used most frequently?

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Table No.7.19: Service used by customers most frequently

Sr.No. Service No. of customers:

1. Home delivery 23

2. Exchange 10

3. Gift Hampers 6

4. Baggage Counter 78

5. Parking 51

6. Helpline 4

7. Alteration 8

8. Other 2

Figure No.7.19: Service used by customers

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Inference:

Above chart indicate that, most of customers use Baggage and Parking facility. Very
few customers use helpline, alteration and other facilities where as Home delivery,
exchange and gift hamper service attracts some customers.

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78
 Observations & Finding

 Store is performing well in attracting the customers.

 Most of the people who visit to the stores are of age group between 22-45 yrs.

 People usually visit the store once in a week i.e. in weekends

 They have different variety of product in food bazaar and house hold utensils

 The main dissatisfaction for the customer is in the billing section and at parking

space.

 Discounts and offers are doing well in the store.

 Most of the customers who visit stores are having annual income between Rs.1.5-3

lac.

 Inside the store, employee’s interaction is very less with customers.

 Location of Big Bazaar is outstanding.

 Cleanliness and hygiene maintained in the store is not up to mark.

 Big Bazaar provides value added service like home delivery, alteration, helpline etc.
but very few customers go for it.
 Electronic and print media has high reach in consumer and plays a major role in
communication about promotional scheme and offers where as word of mouth make
significant impact in decision making than any other means of communication.
 Customers don’t find brands they expect in Big Bazaar especially in apparels

section.

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80
 Conclusions

 Big Bazaar offers a wide variety of products of different prices and different
qualities satisfying most of its customers.

 Prices and offers in Big Bazaar have been one of the main attractions and reasons for
its popularity. The price ranges and the products offered are very satisfying to the
customers.

 Considering the fact that there are huge middle class families in India, Big bazaar
has had a huge impact on the middle class section of India, the prices, variety and
sales strategy has helped in getting the middle income groups getting attracted
towards Big Bazaar.

 The store layout and the assortment of goods is not the best at Big Bazaar,
Customers find it hard to find what they require; this leads to dissatisfaction of
customers.

 Big Bazaar is not acclaimed for high class service. The staffs recruited is not very
well trained and the billing queues take a long time to move, this irritates customers
which makes them visit the store more seldom.

 The customer get all kind of products in the Big Bazaar, i.e. they are following good
merchandising mix, but in some section like apparels they have to keep different
brands in order to attract more customer.

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 Word of mouth publicity played major role in making Big Bazaar so popular where
as media is used to communicate new offers at the store.

 Customers are not aware and hence don’t avail value added services provided by the
store.

 Customers are more satisfied with the merchandising present in the food bazaar and
household utensils section.

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83
 Recommendations

The following suggestion can be given to Big Bazaar

 Keep brands like Koutons, Cotton County which is well known for offers.
 Cleanliness and hygiene should be maintained regularly.

 External environment like parking area should be increase as most of customers face
problem of parking specifically during rush hour.

 The billing time should be reduced by increasing no. of cash counter keeping in
view customer traffic intensity.
 During rush hour, can make provision of less paying counter so customer who want
to purchase single product need not to give up because of long queue.

 Store layout needs to be improved.

 Proper signage should be there so that customer can locate the products easily.
 Value added services have to be improved so that most of customers will avail those
services.

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85
 References & Bibliography

Books

1. Principles of Marketing – Philip Kotler and Gery Armstrong

2. How to Prepare for a Summer Project- Dr. Dilip M. Sarawate

3. Research Methodology - M.V. Kulkarni

Magazines:

Business Today

Websites:

www.wikipedia.com
www.pantaloon.com
www.Futuregroup.com
www.Scribd.com
a. www.ibef.org

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87
 Questionnaire

Name – Age –

Gender- M ( ) F( ) Mobile No -

E Mail- Date-

Occupation- Annual Income-

1. a) Do you frequently shop at big bazaar?

A). Yes ( ) B). No ( )

b) How frequently do you shop at big bazaar?

A) Every week ( ) B). Once in two week ( )

C). once in three week ( ) D). Once in a month ( )

2. a) What comes to your mind when you mean about big bazaar?

A). Discount ( ) B). Product variety ( ) C). Brand ( )

D). Quality ( ) E). Free offer ( ) F). Others ( )

b) Do you feel that you find different variety of product in big bazaar?

A). Yes ( ) B). No ( )

c) Do you find the specific brand that; you look in the big bazaar?

A). Yes ( ) B). No ( )

88
3. In which section do you spend more time while shopping?

A). Food bazaar ( ) B). Apparels ( )

C). Household utensils ( ) D). Other section ( )

4. Do you think, this store has good parking facilities?

A). Yes ( ) B). No ( )

5. How is the ambiance of floor inside the store?

A). Excellent ( ) B). Good ( ) C).Ok ( ) D). Bad ( )

6. How do you feel about sales persons and promoters ?

A). Excellent ( ) B).Good ( ) C). Average ( ) D). Bad ( )

7. How is billing process?

A). Excellent ( ) B). Good ( ) C). Average ( ) E). Bad ( )

8. Do you feel that Big Bazaar provide you value for money?

A). Yes ( ) B). No ( )

9. The cleanliness and hygiene maintained in the store is-

89
 A). Excellent ( ) B). Good( ) C). Ok ( ) D). Bad ( )

10. Product display and signage in the store is-

A). Excellent ( ) B). Good( ) C). Ok ( ) D). Bad ( )

11. Location of Big Bazaar in your city is-

A). Excellent ( ) B). Good( ) C). Ok ( ) D). Bad ( )

12. The store layout at this store makes it easy for customers to move around the store and
find what they want?

A) Strongly Disagree ( ) B) Somewhat Disagree ( ) C) Neutral ( )

D) Somewhat Agree ( ) E) Strongly Agree ( )

13. Through which promotional source you come to know about Big Bazaar?

A). Print Media ( ) B). Electronic Media ( )

B). Word of Mouth ( ) C). Magazine ( )

14. Which type of media appeals you more for purchasing from Big Bazaar?

A). Print Media ( ) B). Electronic Media ( )

B). Word of Mouth ( ) C). Magazine ( )

15. How much do you think that the promotional activities help in making your shopping

Beneficial?

To great Extent -- -- -- -- -- -- Not much

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 1 2 3 4 5

16. Which of the following service you have used most frequently?

A). Home Delivery ( ) B). Exchange ( ) C). Gift hampers ( )

D) Baggage counter ( ) E) Parking ( ) F) Helpline ( )

G) Alteration ( ) H) Other ----------------------------------------------

Please give your experience

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Glossary

IBEC: Irish Business and Employees Confederation

C&F: Carry and Forward

92