4053. growth of indian retail sector & consumer perception – an insight

7/29/2019 4053. GROWTH OF INDIAN RETAIL SECTOR & CONSUMER PERCEPTION AN INSIGHT

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AMITYUNIVERSITY

GROWTH OF INDIAN RETAIL SECTOR &CONSUMER

PERCEPTION-AN INSIGHT

This Dissertation work completed in partial fulfillment of the requirements for thePost Graduation Degree in Marketing and International Business

FACULTY GUIDE: PRESENTED BY:Dr. MEGHNA SHARMA MEGHA RAKHEGA

MBA IB (EVE)

AMITY INTERNATIONAL BUSINESS SCHOOL Page 1


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ACKNOWLEDGEMENT

The journey of thousand miles begins with a single step. This dissertation

project is my first step towards practical knowledge. There is always a

sense of gratitude, which is expressed to others for the support they render

during all phases of life. I really wish to express my gratitude towards all

those who have guided and been helpful during my dissertation project.

I would also like to express my sincere gratitude to my dissertation

supervisor Dr MEGHNA SHARMA, for her continuous support andguidance for this project without which this research would not have been

possible. Her advice and support made all the difference to my work and

gave it the form it has

MEGHA RAKHEGAMBA IB ( EVE

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DECLARATION

I hereby declare that the Research titled Growth of Indian Retail Sector &

Consumer Perception An Insight is the result of individual efforts and has

been completed under the guidance ofMs. MEGHNA SHARMA (Faculty),

The finding and interpretation in the report are based on the data collected by

me and the report is not a reproduction of any other project submitted for similar

purposes.

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TABLE OF CONTENT

1. Executive Summary

2. Introduction3. Research methodology

4. Critical review of literature

5. Issue related to FDI in India

6. Technology used in retail

7.Promotional measures in retail

8. Branded FMCG

9.Challenges before retail sector in India

10. Recommendation & Suggestion

11. Finding & Analysis

12. Conclusion

13. Bibliography

14. References

15. Questionnaire

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CHAPTER- 1

EXECUTIVE SUMMARY

The retail sector in India is most growing sector. In India many large

player comes in this sector some of them are Reliance ,Wall mart, Tata etc.

It comes possible due to foreign direct investment(FDI). The year 2006

marked the beginning of the 'retail revolution' through the entry of big

names such as Reliance with the announcement of huge investments. But

what really grabbed attention was Bharti Group's announcement of its tie-

up with the world's largest retail chain, Wal-Mart.

The most recent noteworthy development was the announcement of the

Bharti-Wal-Mart joint venture. This deal is likely to reinforce confidence

levels and will be viewed as a positive move by foreign retailers. In fact, it

is likely to propel retailers to move faster into India. The entry of Wal-Mart

could result in more structured deals within a regulatory framework of the

Government's policy. International retailers know they cannot afford to not

have operations in India. They are viewing the market with much interest

and with the current regulatory framework, have put strategies on hold,"

said Mr N. V. Sivakumar, Leader - Retail and Consumer Practice,

PricewaterhouseCoopers.

The objective of the study is to understand the retail industry of India as awhole and see the industry in the perspective of emerging Indian Economy.

Moreover the study aims at understanding the opportunities for various

firms in this fast growing sector of India.

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The study will focus on the growth of retail industry particularly in the fast

growing economy of India. It will further put light on the changing

dressing, eating, spending habit of Indian consumers, which has brought

shopping mall culture in the country. Moreover it will focus on the growing

opportunities for domestic companies as well as for foreign companies.

Analysts expects the Indian retail growth process to take a decade since

there is a large population of one billion that needs to be slowly reached

and this population is spread across six hundred thousand villages. The

large urban population of India is about three hundred million and spread

across about a couple of hundred large cities and smaller towns. Organized

retail is expected to home in on this proportion first in the next five to ten

years. At present most of the large retail activity and brand building is

focussed on about twenty Indian cities, each of which has a population of

one million.

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CHAPTER -2

INTRODUCTION

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INTRODUCTION

OBJECTIVE OF THE RESEARCH:

The objective of the study is to understand the retail industry of India as a

whole and see the industry in the perspective of emerging Indian Economy.

Moreover the study aims at understanding the opportunities for various

firms in this fast growing sector of India and we also examine that what are

the perception of consumers regarded to this Industry.

SCOPE OF THE STUDY:

The study will focus on the growth of retail industry particularly in the fast

growing economy of India. It will further put light on the consumer

perception & their changing dressing, eating, spending habit of Indian

consumers, which has brought shopping mall culture in the country.

Moreover it will focus on the growing opportunities for domestic

companies as well as for foreign companies.

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CHAPTER-3

RESEARCH METHODOLOGY

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RESEARCH METHODOLOGY

A research process consists of stages or steps that guide the project from its

conception through the final analysis, recommendations and ultimate actions.

The research process provides a systematic, planned approach to the researchproject and ensures that all aspects of the research project are consistent with

each other.

Research studies evolve through a series of steps, each representing the

answer to a key question.

R ese arch Pro jec t S tep s

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INTRODUCTION

This chapter aims to understand the research methodology establishing a

framework of evaluation and revaluation of primary and secondary research.

The techniques and concepts used during primary research in order to arrive at

findings, which are also dealt with and lead to a logical deduction towards the

analysis and results.

RESEARCH DESIGN

I propose to first conduct a intensive secondary research to understand the full

impact and implication of the retail industry, to review and critique the industry

norms and reports, on which certain issues shall be selected, which I feel

remain unanswered or liable to change, this shall be further taken up in the next

stage of exploratory research. This stage shall help me to restrict and select

only the important question and issue, which inhabit growth and segmentation

in the industry.

The various tasks that I have undertaken in the research design process are : Defining the information need.

Design the exploratory, descriptive and causal research.

Follow each step one by one and conclude the research.

RESEARCH PROCESS

The research process has four distinct yet interrelated steps for research

analysis

It has a logical and hierarchical ordering:

Determination of information research problem.

Development of appropriate research design.

Execution of research design.

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Communication of results.

Each step is viewed as a separate process that includes a combination of task ,

step and specific procedure. The steps undertake are logical, objective,

systematic, reliable, valid, impersonal and ongoing.

EXPLORATORY RESEARCH

The data I used for exploratory research was

Primary Data

Secondary data

PRIMARY DATA

New data gathered to help solve the problem at hand. As compared to

secondary data which is previously gathered data. An example is informationgathered by a questionnaire. Qualitative or quantitative data that are newly

collected in the course of research, Consists of original information that comes

from people and includes information gathered from surveys, focus groups,

independent observations and test results. Data gathered by the researcher in

the act of conducting research. This is contrasted to secondary data which

entails the use of data gathered by someone other than the researcher

information that is obtained directly from first-hand sources by means of

surveys, observation or experimentation.

Primary data is basically collected by getting questionnaire filled by the

respondents.

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SECONDARY DATA

Information that already exists somewhere, having been collected for another

purpose. Sources include census reports, trade publications, and subscription

services. Data that have already been collected and published for anotherresearch project (other than the one at hand). There are two types of secondary

data: internal and external secondary data. Information compiled inside or

outside the organization for some purpose other than the current investigation.

Data that have already been collected for some purpose other than the current

study. Researching information which has already been published. Market

information compiled for purposes other than the current research effort; it can

be internal data, such as existing sales-tracking information, or it can be

research conducted by someone else, such as a market research company or

the U.S. government. Published, already available data that comes from pre-

existing sets of information, like medical records, vital statistics, prior research

studies and archival data.

DATA COLLECTION

Data collection took place with the help of filling of questionnaires. Thequestionnaire method has come to the more widely used and economical

means of data collection. The common factor in all varieties of the questionnaire

method is this reliance on verbal responses to questions, written or oral. I found

it essential to make sure the questionnaire was easy to read and understand to

all spectrums of people in the sample. It was also important as researcher to

respect the samples time and energy hence the questionnaire was designed in

such a way, that its administration would not exceed 4-5 mins. These

questionnaires were personally administered.

The first hand information was collected by making the people fill the

questionnaires. The primary data collected by directly interacting with the

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people. The respondents were contacted at shopping malls, markets, places

that were near to showrooms of the consumer durable products etc. The data

was collected by interacting with 108 respondents who filled the questionnaires

and gave me the required necessary information. The respondents consisted of

house wives, students, business men, professionals etc. the required

information was collected by directly interacting with these respondents.

DETERMINATION THE SAMPLE PLAN AND SAMPLE SIZE

TARGET POPULATION

It is a description of the characteristics of that group of people from whom a

course is intended. It attempts to describe them as they are rather than as the

describer would like them to be. Also called the audience the audience to be

served by our project includes key demographic information (i.e.; age, sex

etc.).The specific population intended as beneficiaries of a program. This will be

either all or a subset of potential users, such as adolescents, women, rural

residents, or the residents of a particular geographic area. Topic areas:

Governance, Accountability and Evaluation, Operations Management and

Leadership. A population to be reached through some action or intervention;

may refer to groups with specific demographic or geographic characteristics.

The group of people you are trying to reach with a particular strategy or activity.

The target population is the population I want to make conclusions about. In an

ideal situation, the sampling frames to matches the target population. A specific

resource set that is the object or target of investigation. The audience defined in

age, background, ability, and preferences, among other things, for which a

given course of instruction is intended.I have selected the sample trough Simple random Sampling

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SAMPLE SIZE

I have targeted 108 people in the age group above 18 years for the purpose of

the research. The sample size is influenced by the target population. The target

population represents the Noida regions.The people were from different

professional backgrounds.

SAMPLING TECHNIQUE

Simple random sampling technique has been used to select the sample. In this

sampling technique we select the respondents randomly.

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CHAPTER-4

CRITICAL REVIEW OF THE LITERATURE

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CRITICAL REVIEW OF THE LITERATURE

RETAIL SECTOR: AN INTRODUCTION

SIZE

India is one of the ten largest retail markets in the world

Retail sales were $206 billion in 2007, over 28% of GDP

Organised Retail constitutes only 4.5% of total retail sales - about $6.4

billion p.a.

However organised retail has been growing at over 24% p.a in the last 5

years

STRUCTURE

The Indian Retail sector is highly fragmented: mostly owner-run Mom and Pop

outlets .Over 12 million retail outlets

Average outlet size < 500 sq.ft

There are a few medium sized Indian retail chains like Pantaloon, Shoppers

Stop, Foodworld (RPG Group) and Westside (Tata Group) - all growing rapidly

Mainly in the apparel and food & grocery segments

Dairy Farm, Metro, Shoprite and Marks & Spencer are the only major

international retail chains in India: Each has a marginal presence through either

franchisee or wholesale formats

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POLICY

100% FDI is allowed in Cash and Carry Wholesale formats. Franchisee

arrangements are also permitted in retail trade.

FDI upto 51% is permissible in the retail trade of single brand products

Top Players in the Retail Industry

Players Revenue

s

Space Format

Pantaloon Retail 150 1,000,000 F&G, SpecialtyRPG Retail 135 590,000 F&G, Specialty

Shoppers Stop 100 740,000 Specialty RetailLifestyle International 53 325,000 Specialty RetailViveks Ltd. 46 150,000 Consumer

DurablesTrent (Tata) 38 270,000 F&G, Specialty

Note: Revenues in ($ million ), Space: Sq. ft.

OUTLOOK

The overall retail market is expected to grow three-fold in the next 10 years from

$206 billion today to about $660 billion by 2015

India is expected to be among the top 5 retail markets in the world in 10 years

Organised retail is expected to grow rapidly to reach $100 billion

by 2015

Likely to account for 12-15% of total retail sales by 2015

POTENTIAL

The high growth projected in domestic retail demand will be fuelled by

The migration of population to higher income segments with increasing per

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capita incomes

An increase in urbanization

Changing consumer attitudes especially the increasing use of credit cards

The growth of the population in the 20 to 49 years age band

There is retail opportunity in most product categories and for all types of formats

Food and Grocery: The largest category; largely unorganized today

Home Improvement and Consumer Durables: Over 20% p.a. CAGR estimated

in the next 10 years

Apparel and Eating Out: 13% p.a. CAGR projected over 10 years

Opportunities for investment in supply chain infrastructure: Cold chain and

logistics

India also has significant potential to emerge as a sourcing base for a wide

variety of goods for international retail companies

Many international retailers including Wal-Mart, GAP, JC Penney etc. are

already procuring from India

RETAIL SECTOR : IN 2007

Indian retailing industry has seen phenomenal growth in the last five years

(2001-2006). Organized retailing has finally emerged from the shadows of

unorganized retailing and is contributing significantly to the growth of Indian

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retail sector. RNCOS India Retail Sector Analysis (2006-2007) report helps

clients to analyze the opportunities and factors critical to the success of retail

industry in India.

Key Findings

- Organized retail will form 10% of total retailing by the end of this decade

(2010).

- From 2006 to 2010, the organized sector will grow at the CAGR of around

49.53% per annum.

- Cultural and regional differences in India are the biggest challenges in front

of retailers. This factor deters the retailers in India from adopting a single retail

format.

- Hypermarket is emerging as the most favorable format for the time being in

India.

- The arrival of multinationals will further push the growth of hypermarket

format, as it is the best way to compete with unorganized retailing in India.

India represents an economic opportunity on a massive scale, both as a global

base and as a domestic market. Indian Retail sector consists of small family-

owned stores, located in residential areas, with a shop floor of less than 500

square feet. At present the organized sector accounts for only 2 to 4% of the

total market although this is expected to rise by 20 to 25% on YOY basis.

Retail growth in the coming five years is expected to be stronger than GDP

growth, driven by changing lifestyles and by strong income growth, which in turn

will be supported by favorable demographic patterns and the extent to which

organized retailers succeed in reaching lower down the income scale to reach

potential consumers towards the bottom of the consumer pyramid. Growing

consumer credit will also help in boosting consumer demand.

The structure of retailing will also develop rapidly. Shopping malls are becoming

increasingly common in large cities, and announced development plans project

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at least 150 new shopping malls by 2008. The number of department stores is

growing much faster than overall retail, at an annual 24%. Supermarkets have

been taking an increasing share of general food and grocery trade over the last

two decades.

However, Distribution continues to improve, but it still remains a major

inefficiency. Poor quality of infrastructure, coupled with poor quality of the

distribution sector, results in logistics costs that are very high as a proportion of

GDP, and inventories, which have to be maintained at an unusually high level.

Distribution and marketing is a huge cost in Indian consumer markets. Its a lot

easier to cut manufacturing costs than it is to cut distribution and marketing

costs.

Also, government has relaxed regulatory controls on foreign direct investment

(FDI) considerably in recent years, while retailing currently remains closed to

FDI. However, the Indian government has indicated in 2005 that liberalization of

direct investment in retailing is under active consideration. It has allowed 51%

FDI in single brand retail.

The next cycle of change in Indian consumer markets will be the arrival of

foreign players in consumer retailing. Although FDI remains highly restricted in

retailing, most companies believe that will not be for long. Indian companies

know Indian markets better, but foreign players will come in and challenge the

locals by sheer cash power, the power to drive down prices. That will be the

coming struggle.

RETAIL VALUE PROPOSITIONS:

The value proposition that retail offers to a consumer is easy availability of the

desired product in the desired size at the desired time.

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RETAILING IN INDIA KEY POINTS:

Total Consumer Spend in the Year 06-07 - INR 9800 billion (USD 375

billion) growing over 5.5% annually

Retail sales - 58% at INR 280 billion (USD 205 billion)

Organised Retail - Only 4% but growing at 8.5%

Organised retail to cross INR 1000 billion mark by 2010.

TRENDS AFFECTING INDIAN RETAIL INDUSTRY:

Changing age profile & Disintegration of joint family: India is

believed tohave an average age of 24 years for its population as against

36 years for the USA and 30 years for China. A younger population tends

to have higher aspirations and spends more as it enters the earning

phase.

Growing disposable income: More Indian households are getting

added to the consuming class with the growth in income levels. Also,

with declining interest rates, the aversion of domestic consumers to

taking loans is also fast disappearing.

Globalization: Growing media penetration is leading to a convergence

of aspirations of various classes of consumers, bridging the rural-urban

divide. The modern consumer cannot be satisfied by any product or

service that is lesser in quality than the best offered in any other place on

the globe.

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Till 1980s, India knew only kirana stores. Things started to change slowly after

that, with companies like Bombay Dyeing, Raymond's, S Kumar's and Grasim

opening their company owned outlets. Later on, Titan, maker of premium

watches, successfully created an organized retailing concept in India by

establishing a series of elegant showrooms.

ORGANIZED RETAILING:

Only 4 per cent of the retail trade in India belonged to organised retail. It

covered items such as apparel, grocery, music, electronics, automobiles and

financial services. This is inconsequential compared to 20 per cent in China, 40

per cent in Thailand and 80 per cent in the United States. The emergence of

organised retail in India is, moreover, so far restricted to the top 15 cities. The

strength of organised retailing lies in the ability to source directly from the

manufacturers due to increased bargaining power achieved through large-scale

operation. Organised retail chains can get bulk discounts on large purchases

and reduce cost by eliminating middlemen and by reducing the supply chain.

However, the potential benefits of lower prices is not evident in the early stages

because modern retailing tends to concentrate on the upper segment of the

market where consumers are willing to pay higher prices for convenience and a

superior shopping environment.

Organised retailing is often run on the principle of franchising. The franchiser

allows a local businessman, a franchisee, to set up a retail outlet using its name

and methods as a joint venture on a 50:50 paid up capital basis. The franchiser

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also provides training, equipment, quality control and national advertising. In

exchange, it receives fees and a share of profits. Organised retailing, moreover,

has multiple formats like discounters, hypermarkets, convenience stores, and

small outlets and warehouse clubs. The special advantages of organised

retailing is:

Enhancing quality through skilled processing, grading and delivery of

goods.

Lower price through better expertise in managing back-end activities

such as sourcing and inventory management as well as the ability to

strengthen the front-end functions of merchandising, promotions and

customer services.

Creating a level playing field for small and medium enterprises vis--vis

the large manufacturers.

Higher productivity per worker and better job opportunities.

The growth of organised retailing is thus expected to lead to value migration

from wholesale trade to retail trade.

1999 2002 2007Total Retail (in billion INR) 7000 8250 11000Organized Retail (in billion INR) 50 150 450

% Share of Organized Retail 0.70% 1.80% 4.5%

Five Reasons why Indian Organized Retail is at the brink of Revolution:

Scalable and Profitable Retail Models are well established for most of the

categories.

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Rapid Evolution of New-age Young Indian Consumers

Retail Space is no more a constraint for growth

Partnering among Brands, retailers, franchisees, investors and malls

India is on the radar of Global Retailers Suppliers.

RETAIL FORMAT:

Broadly, the organized retail sector can be divided into 2 segments:

In-store Retailers: Operate through fixed point of sale outlets located

and designed to attract a high volume of walk-in customers. Also

referred to as brick-and mortar format.

Non-store Retailers: Reach out to the customers at their homes or

offices through direct selling, tale marketing and e-commerce.

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Major formats of In-store retailers have been listed in Table below: -

FORMAT DESCRIPTION VALUE PROPOSITION

Branded Stores Exclusive showrooms

either owned or

franchised out by a

manufacturer.

Complete range

available for a given

brand, Certified product

qualitySpecialty Stores (Multi-

Brand)

Focus on a specific

consumer need, carry

most of the brands

available

Greater choice to the

consumer, comparison

between brands

possible.Department Stores Large stores having a

wide variety of products,

organized into different

departments, such as

clothing, house wares,

toys, etc.

One stop shop catering

to varied consumer

needs, service as

differentiator.

Supermarkets Extremely large self-

services retail outlets.

One stop shop catering

to varied consumer

needs.Discount Stores Stores offering discounts

on the retail price

through selling high

volumes and reaping the

economies of scale.

Low prices

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Hyper-mart Larger than aSupermarket, sometimeswith a warehouseappearance, generallylocated in quieter parts

of city

Low prices, vast choiceavailable includingservices as cafeterias.

Convenience Stores Small self-serviceformats located incrowded urban areas.

Convenient location andextended operatinghours.

Shopping Malls An enclosure havingdifferent formats of in-store retailers all underone roof

Variety of shopsavailable close to eachother.

Of the Top-200 Global Retailers, 21% of retailers fall in the specialty stores

category, followed by 18% in supermarket, 12% in department and 9% each in

hypermarket and discount stores.

RETAIL FORMATS IN INDIA:

Indian retail formats can be classified into two distinct categories:

(1) Traditional

(2) Modern

Traditional Formats include: -

Kiranas: Traditional Mom and Pop Stores

Street Markets

Kiosks

Exclusive / Multiple Brand Outlets

Modern Formats include: -

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Supermarkets such as Food world

Hypermarkets such as Big Bazaar, Giant, Shop rite, Star

Company Owned / Operated such as Bata, Sony

Department stores such as Shoppers stop, Lifestyle, Pantaloons,

Pyramids, Trent

INDIAN RETAIL ESTATE BY 2007 :

From 95 currently operational shopping centres with approximately 22-

million sq.ft space, India to have over 375 shopping centres/ Malls

covering over 90 million sq.ft quality retail space by 2007 end

50 hypermarkets, 305 large department stores, 1500 supermarkets and

over 10,000 new outlets under construction

Additional Retail space to add INR 300 billion of business to organised

retail.

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CHAPTER - 5

ISSUES RELATED TO FDI IN RETAIL IN INDIA

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ISSUES RELATED TO FDI IN RETAIL IN INDIA

Traditionally, the retailing sector in India has been characterised by the

presence of a large number of small, unorganised retailers, popularly referred to

as mom-and-pop shops or kirana stores. The unorganised sector still dominates

the retail sector, with the organised sector accounting for only 3%. Retailing is

one of the few sectors where foreign direct investment (FDI) is not allowed. But

India is emerging as an attractive destination for FDI in retailing, evoking

considerable protest from trading associations and other stakeholders. The

government announced a partial opening of the sector by announcing 51% FDI

in single-brand retailing last week. Closer Look at some of the issues related to

FDI in retailing.

Was the retailing sector never opened to FDI?

Prior to 1997, there were no regulations restricting the entry of foreign players.

Nanz and Spencers are two major companies who were granted permission to

sell products directly to customers. In 1997, it was decided that FDI would not

be allowed for mere trading as it would lead to the outflow of foreign exchange,

drive out the unorganized retailers from business and increase unemployment.

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Do other countries allow FDI in retailing?

India is one of the few countries where FDI is not allowed in retailing. Almost all

major developed and developing countries have allowed it. Some have imposed

restrictions such as minimum capital requirements, sourcing conditions,

investment in supply chain, etc, while others have opened the sector in a

phased manner to allow domestic retailers to adjust to the changes.

Will opening the sector result in loss of jobs?

Its an aspect thats been greatly debated. Theres a view that modern trade will

unleash opportunities such as non-agricultural employment and better quality of

living for the existing agricultural society. Others say that by reducing the

number of intermediaries, middlemen etc, organised retailing will lead to some

job displacement. But this, they insist, will be compensated for by creation of

jobs in allied sectors such as the food processing industries. Currently, the retail

industry is the second largest employer, after agriculture, and it is estimated that

the sector has the potential to create eight million jobs.

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Will FDI in retail adversely impact kirana stores?

At present, mom-and-pop stores cater to 97% of the total market. They have

unique advantages, like indigenous processes, skills in retaining customers,

proximity, convenience and services. However, global retailers investing in new

markets have not hampered local retailers. In China, Carrefour, the largest

foreign retailer, has 68 hypermarkets and Wal-Mart 47. Despite this, domestic

competitors hold more than 90% of the market.

In India, of the 12 million retail outlets, only about 3.5 million are in urban areas,

where organised retail is likely to be restricted to. So only about 3% (about one

lakh) of the outlets in the midmarket range would be potentially affected.

Has FDI restriction acted as an entry barrier?

Not really. Many foreign players have entered the Indian market through

different routes. But the restriction has resulted in an uncertain regulatory

environment and prevented business expansion of both domestic organised

retailers and foreign retailers.

What are the other routes of entry?

Foreign players can enter the Indian trading sector through routes like

manufacturing and local sourcing; franchising; test- marketing; wholesale cash-

and-carry; distribution and through special permission. Franchising is the most

preferred mode through which foreign players have entered the Indian market.

Fast-food chains like Pizza Hut, McDonalds and brands such as Lacoste,

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Mango, Nike etc ,have entered the Indian market through this route.

Similarly, companies such as Swarovski and Hugo Boss have set up distribution

offices in India and these offices supply products, which the company imports to

local Indian retailers. In the case of test-marketing, FIPB allows foreign

companies to test-market products for a two-year period. Direct selling

companies like Amway and Oriflame entered the Indian market through this

route.

What is single-brand retailing?

While the finer guidelines as to what constitutes single-brand retailing are yet to

come, its likely that under this route, retailers would deal with a single brand

catering to a select clientele. Though such a classification does not exist

anywhere in the world, in India such a decision was taken as a first step

towards opening up the sector and also to probably allay the apprehensions of

those who have been opposing FDI in retail.

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CHAPTER-6

TECHNOLOGY USED IN RETAIL

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Technology Used in Retail

Over the years as the consumer demand increased and the retailers geared up

to meet this increase, technology evolved rapidly to support this growth. The

hardware and software tools that have now become almost essential for

retailing can be into 3 broad categories.

Customer Interfacing Systems

Bar Coding and Scanners

Point of sale systems use scanners and bar coding to identify an item,

use pre-stored data to calculate the cost and generate the total bill for a

client. Tunnel Scanning is a new concept where the consumer pushes

the full shopping cart through an electronic gate to the point of sale. In a

matter of seconds, the items in the cart are hit with laser beams and

scanned. All that the consumer has to do is to pay for the goods.

Payment

Payment through credit cards has become quite widespread and this

enables a fast and easy payment process. Electronic cheque conversion,

a recent development in this area, processes a cheque electronically by

transmitting transaction information to the retailer and consumer's bank.

Rather than manually process a cheque, the retailer voids it and hands it

back to the consumer along with a receipt, having digitally captured and

stored the image of the cheque, which makes the process very fast.

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Internet

Internet is also rapidly evolving as a customer interface, removing the

need of a consumer physically visiting the store.

Operation Support Systems

ERP System

Various ERP vendors have developed retail-specific systems which help

in integrating all the functions from warehousing to distribution, front and

back office store systems and merchandising. An integrated supply chain

helps the retailer in maintaining his stocks, getting his supplies on time,

preventing stock-outs and thus reducing his costs, while servicing the

customer better.

CRM Systems

The rise of loyalty programs, mail order and the Internet has provided

retailers with real access to consumer data. Data warehousing & mining

technologies offers retailers the tools they need to make sense of their

consumer data and apply it to business. This, along with the various

available CRM (Customer Relationship Management) Systems, allows

the retailers to study the purchase behavior of consumers in detail and

grow the value of individual consumers to their businesses.

Advanced Planning and Scheduling Systems

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APS systems can provide improved control across the supply chain, all

the way from raw material suppliers right through to the retail shelf.

These APS packages complement existing (but often limited) ERP

packages. They enable consolidation of activities such as long term

budgeting, monthly forecasting, weekly factory scheduling and daily

distribution scheduling into one overall planning process using a single

set of data.

Leading manufactures, distributors and retailers and considering APS

packages such as those from i2, Manugistics, Bann, MerciaLincs and

Stirling-Douglas.

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CHAPTER - 7

PROMOTIONAL MEASURES IN RETAIL SECTORAND ITS EFFECTS

Promotional Measures In Retail Sector And Its Effects

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As competition heats up in Indian retail, major retailers are attracting more

customers through quirky "event packages"/attractions or price promotions.

Customers are encouraged to celebrate a special occasion with a celebrity as

well as to spend money in the stores. It comprises specifications for a marketing

operation that is limited in time and that is meant to draw increased attention to

the enterprise (the retail outlet or the retail chain) in its sales market or the

influencing trading area. As a rule, it has a sales-promoting effect.

Setting objectives

The launch of promotional activity for a store requires creative handling of one

of the above ways of handling retail promotions. The most important factor to be

considered for retail promotion is the objective for promotion. If Food World

advertises that it has got the IR 8/20 rice at one of the lowest prices in the town,

the objective is to use the destination category of the retail grocery store to

attract greater store traffic. Promotions that increase footfalls and therefore

improve store traffic may result in a competing stores loyal customers to visit

and even try non-promoted merchandise. At the same time it would increase

store inter-visit time for the regular loyal store customers. Retail promotion

objectives can be store specific or product specific but the intended result is

something that has to be explicitly borne in mind while formulating a promotion

plan. There is a need to review the same after the promotion.

Shopper reaction

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The

consumer perspective of retail promotion is also crucial in formulating

promotions. Purchase event feedback is one of the crucial elements of the

understanding of retail promotion. This concept means monitoring if the

promotion enhances or detracts consumers from future brand purchase

probabilities compared to non-promotion. In order to understand this concept,

one should look at a key theory in psychology as applied to consumer behavior,

the self-perception theory. Self-perception theory as attributed to the deal prone

consumer, results in questioning by the consumer - 'Did I buy the product

because of brand preference/ promotion?' The answer to this question by a

majority of the consumers of your store determines the nature of promotion to

be undertaken by the store.

If for example Shoppers Stop has through its customer relationship

management software a clear idea of the nature of customers especially

on deal prone-ness, it can decide what to emphasize in its promotion.

The decision to be taken is whether it is the store/brand or the

promotion/deal that would act as the primary reinforcement. The nature

of promotion needs to adapt according to the understanding of consumer

behaviour. In this effort, we would also be able to clearly track brand

loyal as well as store loyal consumers behavioral effects of the

consumer, when a promotion is on are reflected in the nature of buying

and therefore implications for the retail outlet. Category purchase timing,

brand choice, and purchase quantity are the three major dimensions that

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one has to track in order to see the effect of sales promotion. Category

purchase timing refers to the decision by the consumer to alter the

regular purchase cycle for the product. If Atta is bought once in a

fortnight, does she buy Atta earlier because of promotion? Brand choice

refers to the decision on being brand loyal inspite of a promotion on a

comparable competitive substitute brand. Would a consumer change

from Captain Cook to Tata salt because of promotion? Purchase quantity

is a very important variable to monitor as it is directly related to the

nature of consumption. This common effect of a promotion on a product

or a brand is reflected in stockpiling. For example, buying a five-litre

edible oil jar cheaper and storing the same for longer future use.

Lets take the example of a specialty coffee outlet selling different brands

of coffee. If we decompose the effect of sales promotion we may look, at

lets say, contribution of the three dimensions in the following manner -

brand switching (84 percent), purchase acceleration (14 percent), and

stockpiling (2 percent). This decomposition may be used to compare the

effectiveness of alternative promotional offerings and to determine the

most suitable and effective promotion. Putting together the facts that

sales promotions generate dramatic immediate sales increases and that

brand switching accounts for a large percentage of this increase, we can

conclude that sales promotions are strongly associated

with brand switching. If promotion increases a brand's sales by 100 units,

how many units come from other brands and how many units are due to

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category expansion, i.e. shifts in the timing and/or amounts of purchase.

If three-fourths of the sales effect were due to other brands, retailers

might conclude that promotional activities provide little benefit. That is,

unless promoted items provide higher margins, the vast majority of the

effect would simply be a reallocation of expenditures by households

across items within a category. Manufacturers/national brand marketers

might conclude that most of the effect increases competition between

brands and would not support promotions. Therefore, stockpiling and/or

consumption increases appear to be the dominant sources to look for

sales effects due to temporary price cuts. Cannibalization of future sales

through stockpiling is an important consideration in the assessment of

the effectiveness of sales promotions. In some product categories like

beverages (Eg. soft drinks) a substantial component of the primary

demand increase may represent enhanced consumption. One may drink

more of Coke/Pepsi because of a price cut. But in other categories (like

house cleaning liquids), households are unlikely to accelerate

consumption. In these cases the effect of sales promotion may just result

in changed inventory management by households.

Price/brand promotion

It has been proved by extensive research in the West that price

promotions are detrimental whereas non-price promotions are

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neutral/positive. Price promotion of national brands erodes the loyalty of

the national brands & therefore helps the private labels/ store labels to

gain market share. While looking at it from store's viewpoint, the chain of

causation could be - Price promotion would lead to loss of national brand

loyalty, which would trigger greater trade allowances and therefore

increase in store profit. However, the question of store image and loyalty

are important. Discount stores like Margin Free shop could afford to

continuously involve in price promotion whereas others cannot. Reaction

from competitors is another aspect that should be guarded against.

The conflict of promotion of store brands compared to the national

brands would become a matter of concern in the future in India. Many

retailers see the benefits of developing store loyalty as it can easily

extend to store brands. There are very few store brands in India

competing with large brands. However, for store brands, studies in the

US have found that non-price promotions have a more favorable long

term effect on store profit compared to price promotion.

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CHAPTER-8

THE BRANDED FMCG: BOTH CONSUMERS AND

RETAILERS CHOICE

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THE BRANDED FMCG: BOTH CONSUMERS AND

RETAILERS CHOICE

One of the first tasks that any retailer does before starting shop is

deciding on the product mix at the store. This is not a one-time process

and is refined over a period of time based on the point-of-sales data,

market research and by observing trends in consumer behavior. To

make this task simpler for the food & grocery retailers, on the top 100

FMCG brands in the country and published . The survey relies on data

provided by AC Nielsen Retail Audit for the twelve months ended August

2004 except for cigarettes and carbonated soft drinks, where the figures

based on market intelligence

The popular cigarette brands i.e.( Gold flakes,Wills Navy Cut), three soft drinks

i.e.(Pepsi, Thums up, Coco Cola), two biscuit brands i.e.(Britannia, Parle), two

detergents i.e.(Nirma, Wheel) and one oral care brand i.e. (Colgate) make up

the top 10 FMCG brands in India. The top 10 brands between them tote up Rs

15,230 crore (US $ 3.2 billion) and account for no less than 37 per cent of the

sales of the top 100 FMCG brands in this survey, which total Rs 39,144 crore. If

the Indian market for FMCGs is estimated at Rs 90,000 crore, then these ten

brands contribute nearly 14 per cent of sales and the top 100 brands contribute

about half of the total sales.

Of the 10 brands, seven brands are owned by MNCs, three by Indian

companies. That's not all, there are some other interesting trends: 62 of the top

100 brands as studied by AC Nielsen are owned by MNCs, the balance by

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Indian companies. By value, MNC brands hold 70 per cent of total top 100 sales

or Rs 27,470 corer (US $5.8 billion). Fifteen companies own these 62 brands,

and not surprisingly, 27 of these are owned by one company - Hindustan Lever.

The number three brand is Pepsi at Rs 1,740 core. At number four comes

Thums Up, ahead of Coca-Cola, its parent's flagship brand. Britannia takes the

fifth place, with its slew of products, aggressive advertising and its `health'

platform for biscuits. Colgate is at number six, followed by Nirma (7) , Coca-

Cola (8) and Parle (9). These are figures the soft drink and cigarette companies

have always shied away from revealing.

For the first time, Brand Equity presents estimates - after talking to reliable

industry experts and senior officials of the companies concerned - that gives

you a sense of the annual sales of soft drinks in India. Brand Pepsi at Number 3

(Rs 1,740 corer) includes the Rs 94-crore new variant Pepsi A-Ha. Thums Up at

fourth position (Rs 1,350 corer) and Coca-Cola at eight (Rs 1,030 corer)

dominate the list, as expected. Mirinda ranks 20 (Rs 540 crore), Limca is at 18

(Rs 600 crore), followed by Fanta at 30 (Rs 400 crore), 7-Up at 53 (Rs 210

crore) and Maaza at 84 (Rs 127 crore).

It's interesting that the Indian brands Thums Up and Limca, which have been

familiar to consumers for many years, rank in the top 100 right next to their

MNC owners. The Indian soft drink market seems to be operating along global

lines, with the entry of MNC players causing heightened market activity,

advertising, sponsorships, mergers along with buy-outs of local suppliers.

Figures for PepsiCo's brands are based on consumer spends and a weighted

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mean retail price, while Coca-Cola India's brands are ranked on gross revenue

excluding sales tax. The extent of HLL's dominance of the Indian FMCG market

is also clear. The 27 HLL brands are worth Rs 9,243 crore and account for 25

per cent of the top 100 brand sales. But HLL has just one brand in the Top 10:

Wheel with sales of Rs 814 crore, though a further 17 brands do make the top

50. Nirma dominates in its own way. Ranked seventh amongst India's largest

brands, with sales of Rs 1,182 crore (US $240 million), its position is testimony

to Karsanbhai Patel's strategy of value for money. The company today claims

Nirma's user base exceeds 400 million people, a number even a global leaders

would envy. Nirma has another of its brands in the top 100: Nima, ranked 23,

with sales of Rs 459 corer. The consolidated Tata brands - Tata Tea and Tata

Salt - rank at number 14 with sales of Rs 646 chore, which includes the tea and

salt brands.

Category movers

Personal care, cigarettes and soft drinks are the three biggest categories in

FMCG. Between them, they account for 35 of the top 100 brands. In value

terms, these 35 brands rake in 50% ( Rs 19,707 corer) of the total sales of Rs

39,144 corer of the top 100 FMCG brands. The personal care category has the

largest number of brands - 21 - in it. Heavy weights such as Lux, Lifebuoy, Fair

and Lovely, Vicks, Ponds all clubbed in it.

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CHAPTER-9

CHALLENGES BEFORE RETAIL SECTOR ININDIA

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Challenges Before Retail Sector In India :

Government restrictions on FDI: Organised retailing in India is yet to get an

industry status. The consequence is quite obvious. 100% Foreign Direct

Investment (FDI) is not permitted in retailing in India. Ownership of retail chains

is allowed only to the extent of 49%. The Food World chain is one such venture,

with an ownership pattern of 51:49 between RPG and Dairy Farm International,

Hong Kong. Foreign players can enter the wholesale sector , in the cash and

carry format. The Metro chain has recently entered the country as a cash and

carry outlet. A branch has been opened in Bangalore and a second would be

opened very soon in the same city. The fear that the small-scale retailers will be

displaced is delaying the FDI approvals. On the other hand, without the FDI

sector is deprived of access to foreign technologies that is imperative for faster

growth. The Government has allowed FDI in direct marketing, but has

reservations about extending it to the retail sector Retailing is a technology-

Retailing is a technology- intensive industry. Under the liberalized regime of

the WTO the Protected nature of an industry may do more harm than good. In

the short-run the Government may succeed in protecting the domestic industry,

but in the long run we would be loosing too many opportunities and

technological innovations. This, in addition would also block any attempt by the

domestic industry to become competitive internationally.

Lack of a uniform tax : The country requires a uniform tax system for the

organized retailing. The lack of this stands as an obstruction to the setting up of

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a truly national chain. The present chains, in spite of claiming to be national

chains are restricted to certain regions of the country. Players are confined to

state barriers. Since retailing

is essentially a business of supplying commodities to locations far from

production units, a differential tax system in different states is surely turning to

be a hindrance to faster development of this Industry. A central tax system

becomes more imperative in a country like India where, the regional disparity in

production of commodities is high.

Lack of adequate infrastructure: Players are forced to set up their own

infrastructure,

as there are few independent logistics solution providers. Entrepreneurs to

invest in infrastructure development for different stages of the supply chain are

also limited.

Dominance of the unorganized Sector : The Unorganized has dominance

over the Organized sector in India, especially because of the low investment

needs. In India Organized retailing is only 2% of total retailing of worth US$ 180

billion. This is playing at multiple levels For instance, the reason for low number

of discount stores in India is effect of the dominance of the unorganized sector

The manufacturers have high bargaining power in the pricing of products as a

result of this small scale of operation of retailers. The lobbying by the

unorganized sector is also the main reason for the Government Of Indias

restrictions on 100% FDI in retailing in the country.

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Low operational size : The number of retail outlets in India is more than

number of outlets in most of the other countries, small size retail outlets

dominate the Indian scene. 96% of outlets are lesser than 500 sq ft. The retail

chains of India are also smaller than those in the developed countries. For

instance, the superstore food chain, Food World is having only 52 outlets

whereas Carrefour Promodes has 8800 stores in 26 countries. The volume of

sales in Indian retailing is very low, which is only $180 billion. Even the largest

players have a turn over of only US $ 140 million, which is very small by the

global standards. India with second largest population in the World and a fast

growing economy has huge untapped potential of organized retailing, which is

not given its due weightage by the government.

Labour employment problems : Organized retailing is a 24 X 7 active

business. However, this is much restricted currently in India because of ladour

rules and regulations. The sector is unable to employ retail staff on contract

basis. This makes it difficult to efficiently manage employee schedules

especially for 365-day operations. The industry has to take special clearance for

extended working hours and even seven days working from the Labour

department. However, in the recent budget government has relaxed norms on

employment of contract labour, which is expected to benefit the industry.

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CHAPTER-10

FINDINGS & ANALYSIS

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FINDINGS & ANALYSIS

ANALYSIS OF CONSUMER PERCEPTION

1.Do you prefer to purchase from retail organization.

0

10

20

30

40

50

60

70

YES

NO

Interpretation: As we have seen from the above column chart that the 65

percent of respondents say yes and only 35 percent say no,

because they belongs to lower income category and can not

afford.

2. How many retail organization you know of your city?

10

25

50

15Less than 2

2 to 3

3 to 4

more than 4

Interpretation: As we have seen from the above pie chart that the 10 percent of

respondents can name only one retail organization name 25

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percent can name 2 to three name 50 percent can name 3 to 4

name and rest can name more four name.

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4.How many time you usually go for purchase?

10

40

30

20

Never

Two Times

Four Times

More

Interpretation: As we have seen from the above pie chart that the 10 percent of

respondents never go for purchase because they can not

afford.40 percent usually go 2 times in a month for purchase ,30

percent usually go 4 times for purchase and 20 percent go more

than four times in a month for purchase.

5. Do you make plan before your purchasing from retail shop.

YES, 65

65%

NO, 35,

35%

YES

NO

Interpretation: As we have seen from the above pie chart that the 60 percent

say yes i.e they make plan for their purchase and rest of them purchase

atrandomly.

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6. Are you satisfied with your purchasing every time.

YES, 65,

65%

NO, 35,

35%

YES

NO


of respondents are satisfies with their purchasing and rest of

them means 35 percent are not satisfy.

7. What characteristics attract you to purchase?

[i. Five star environment ii. Product line iii. Customer support iv. Convenience]

10%Pie 1,

Ist &

Iind,

22,

Pie 1,

Ist,Iin

Pie 1,

all, 40,

40%

Only Ist

Ist & Iind

Ist,Iind & IIIrd

all


of respondents only attracted by Ist,22% are attracted by Ist &

IInd option, 28% are attracted by Ist,IInd & IIIrd option and rest of

them are attracted by all feature of retail.

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8. Will you suggest other person to purchase from retail organization.

YES

78%

22%

YES

NO


of people will never suggest other person to purchase from retail shop because

of their bed experience but 78% of person will suggest other person to purchase

from retail shop because they are extremely satisfied.

10. Retails shops is which type of place for purchasing? According to your

perception.

Best

60%

Good

35%

Say

5%

Best

Good

C't Say

Interpretation: As we have seen from the above pie chart 60% of people

percept that the retails are best place for purchasing 35%

percept that it is good place and 5% can not say anything.

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CHAPTER-11

RECOMMENDATION

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RECOMMENDATIONS FOR FACING CHALLENGES

FDI IN RETAIL: EVOLVING AN INDIA-SPECIFIC MODEL

Opinions on FDI were divided at the IFF symposium. The Government of India

would be wise not to open the doors to foreign retail too wide as it is better to

develop India's own modern retail model than give away the businesses to

global retailers like Wal-Mart and Tesco. selective approach in allowing FDI,

which could be directed towards:

Mall Development

Shopping Centre development and management

Luxury retailing

Lifestyle brand retailing

Lifestyle products and brands manufactured in India

INDUSTRY STATUS TO RETAIL:

o The wish list of retailers included setting up single window clearance and

the demand for according industry status to retail was high on their

agenda. B.S. Nagesh earlier said, "Indian retail has no parentage in the

Government of India. We do not know which Ministry to report to. The

Government should grant us industry status." To this, Kamal Nath

replied: The Retail sector is already in a position whereby it can decide

which ministry it wishes to adopt, rather than asking the government to

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adopt retail as an industry. Your industry is in the departure lounge ready

to take off and I assure you that the Indian government will give it the

boarding card.

Quoting from the Images-KSA Retail Report contained in the IMAGES

YEAR BOOK 2005 which Kamal Nath released on the occasion, he said

of the estimated Rs.930,000-crore ('03-'04) retail industry, organised

retailing accounted for a mere Rs.28,000 crore, just 3 percent of the total

market. This figure stands against 85 percent (organised retail) in the

US and hence the need to plan differently, he explained. the Retail

Report 2007 that sizes up the total Indian market, organised retail,

various sectors and scope therein, and size and performance of key

players. These two studies establish benchmark figures for the

Government and industry to work on.

REVITALISING A BRAND:

Retail brands, big and small, face ups and downs in their performance graph,

which is more a relative term depending heavily on the performance of the

competitors. And with modern day markets getting innovative to the fore,

retailers have to constantly devise strategies to revitalise their brand so as to

regain their market share. Anna Pretty, Wedgwood, UK, described one such

success turnaround, the challenges faced by Wedgwood (a store established in

1758 in UK) and the solutions it devised to survive the competition.

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From product, layout, store interiors, packaging to communication and

greetings, everything at Wedgwood was re-designed to create an interest in the

modern consumer who has much wider options when it comes to shopping,

Anna said. First of all it was considered necessary to effect changes in the retail

and design aspect. A new image was imparted to the store, followed by re-

introducing of the core merchandise with special focus on quantities and

packaging. Then new products and categories were introduced with the aim of

presenting a whole range a complete lifestyle offer so as to revive interest of the

today's generation. All this was not easy task for this store with 250 years of

history.

Then we felt the need to create a feeling for the customer to make him or her

walk in to Wedgwood store and want to stay there, Anna Pretty said. The

emphasis was clearly to offer old wine in a new glass and at the same time

introducing new product categories like non-ceramics, jewellery and

showpieces like picture frames and greetings. Materials were the same but had

a new style, she said. The same company, with same values had a new focus.

The focus being: Everything must say Wedgwood.

GAINING A COMPETITIVE EDGE:

It's the people who build brands, not blind advertising; and to be successful, it's

absolutely necessary to create the buzz amongst the high profile customers,

echoed the success mantra from International marketer of the Year Bob

Pritchard, CEO, Mkt. Force One, Inc., USA. Bob, who carries with him 30 years

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of marketing experience and an unmatched oratory skill, started his inspiring

IFF Fashion-Retail Conclave presentation on Positioning and Brand Equity-How

to Gain a Competitive Edge with the compliment that India is a country of

fantastic opportunity and tremendous promise.

While outright discarding the significance of traditional factors like Customer

satisfaction, High Quality sales and Store Loyalty, Bob said it is the Vision,

Commitment and Enthusiasm of retailers and marketers that actually drives

businesses. He said, 95 percent of the factors such as product, price, customer

and brand awareness fail; 92 percent of the customers find like products

interchangeable; and 62 percent of the satisfied customers never repurchase

from the same store.

What really counts in today's world is Equity, which stands for:

Emotional experience

Perception

Service Experience

Media Experience

Feedback from friends

On-line experience

Perception of one's corporate citizenship

While spelling out some of the unique fundamental factors that help achieve

Brand Equity, modern-day retailers ought to focus on:

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Creating emotional experience

Selling emotional benefits

Effective communications

Collecting knowledge of the customers

Differentiating from the market

Positioning statement

Added value and service, and

Thinking out of the box

PLANNING MALLS THE CORRECT WAY: Malls being the modern-era retail

destinations, a good part of the IFF seminar was devoted to detailed

presentation and discussion on various facets of mall planning and

management. Amit Bagaria, Chairman, Asipac Project Consulting Services, one

of the leading mall planners in India, presented an in-depth knowledge on how

mall developers need to work on their projects so as to uphold the best

international standards.

The foremost task was to have a detailed business plan, based on the

company's targets and constraints, Amit Bagaria said. This would include

Tenancy mix, Support services, Required infrastructure, Estimated project cost,

and Estimation of revenue and operating expenditure.

The second stage was that of Design conforming to the Plan as Design always

ought to come only after everything is planned in advance, taking care of the

projected average and peak footfalls (PAPF) and Average duration of visit

(ADOV), said Bagaria. Keeping in mind the above a mall planner has to think of

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the number and types of parking, vertical circulation, washroom facilities, food

court sizes, R&R reas, etc.

The developer also needs to look at the critical factors, which are generally

overlooked, like Selecting the best mall planner and architects and Coordination

between the involved role players like planners, structural engineers, leisure

consultants etc, he emphasized.

Bagaria spoke at length about the differences between the Indian and

International Architectural Processes, about what all goes in to the Conceptual,

Schematic and Functional design stages and about what all expertise is

required for On-site construction management. His conclusion was that the

prevalent process in India is more time consuming than the international model,

which considerably reduces the construction time, thereby making it more

viable.

SECRETS TO SUCCESSFUL MALL OPERATIONS:

Experience and expertise flowed as Walter Kleinschmit, Principal R2E (Retail &

Real Estate) Consultants and former general manager, Kingdom Centre

(Riyadh, Saudi Arabia) presented his 10 Rules To Obtain Sustainable Returns

from Malls. It is challenging to get customers and it is so very easy to lose

them, after so much energy spent that situation needs to be avoided, Walter

said and added, Development and Operation, both processes take place

throughout life of project.

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The major factors affecting the success graph of malls, the doctrines that work

to keep the money flowing, were listed as follows:

1. Planning: Understanding the mission, converting it to objectives that are met

through tactical decisions, and working with the given limitations;

2. Branding:The brand conveys the value proposition, which is the

differentiating factor, occupying a distinct position in the mind of the client/

consumer;

3. Marketing: Facilitates generating footfalls and increasing the conversion

rate;

4. Promotion: Concentrates on increasing footfalls or conversion rates, often a

short term response to tenant requirement;

5. Leasing & Lease Renewals: Location being the most important aspect of

any Mall, this factor requires a lot of careful understanding;

6. Maintenance: The main stress was laid on the following trivial looking

aspects like: - Baby Changing Station - Level Sidewalk - Garbage Removal -

Clean Walls etc;

7. Security: A Sense of Well Being, No Hassles (Little Risk, Great Place to

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take your family), - Not to scare away those who pay your salary;

8. Hospitality: A frame of mind of the management and a guiding principle

behind Maintenance and Security that add value to customers, like - Concierge

Service, - Valet parking, - Courteously Shopping Bags (Means of Good

Advertising), - Informative Directory (can generate revenue), etc;

9. Records Keeping the records straight is effective both in terms of store

operation and customer service; and

10. Do it again and again, but better.

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CHAPTER-12

CONCLUSION

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CONCLUSION

The Indian retail sector is witnessing tremendous growth with the changing

demographics and an increase in the quality of life of urban people. At this

moment, it is still premature to say that the Indian retail market will replicate the

success stories of names such as Walt-Mart Stores, Sainsbury and Tesco but

at least the winds are blowing in the direction of growth.

Retailing in India is gradually inching its way toward becoming the next boom

industry. The whole concept of shopping has altered in terms of format and

consumer buying behavior, ushering in a revolution in shopping in India.

Modern retail has entered India as seen in sprawling shopping centres, multi-

storeyed malls and huge complexes offer shopping, entertainment and food all

under one roof. The Indian retailing sector is at an inflexion point where the

growth of organized retailing and growth in the consumption by the Indian

population is going to take a higher growth trajectory. A large young working

population with median age of 24 years, nuclear families in urban areas, along

with increasing workingwomen population and emerging opportunities in the

services sector are going to be the key growth drivers of the organized retail

sector in India.

The Indian consumer is dressing up, eating, spending, like never before. And

helping him look good , ready to eat, leather products are the hugely successful

brands. Quick to adapt to current trends and the latest in fashion and

completely in sync with customers' wants, these highly versatile brands have

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given a bold new shape to whether the ready-to-wear apparel industry, leather

industry, Gems and Jewellery Industry Indian consumer is showing an

increasing fascination for branded wear, ornaments, leather products. The

reasons are clear - one, the increased disposable income of Indian households

and two, the fast paced changes in the leather, apparel, food industries. Today's

customers are fussier than ever before - they are more aware of current trends,

are totally in sync with the latest in fashion and demand the best products as

well as service at an affordable price.

To encash this growing and changed demand of Indian consumers, many

garment manufacturing companies are opening up their retail outlets.

Companies like Raymond, Levis, Pantaloon, Ebony, John Player, Lifestyle,

Shoppers Stop, TCNS Clothing, Spykar, Pizza Hut, Mc Donald, DTC Diamond,

Tanishq( A TATA product)etc. already have their retail stores at various part of

the country.

As the sector is growing many foreign companies are eying to enter into the

retail market and specially in the apparel sector. It was difficult for them to

directly enter into Indian retail sector earlier, but now as the FDI in the sector

has been allowed up to 51% it has opened up the sector for the foreign

companies to set up their business .

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CHAPTER-13

BIBLIOGRAPHY

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BIBLIOGRAPHY

PRIMARY DATA

QUESTIONAIRE

NEWSPAPER & MAGAZINES:

The Economic Times

The Financial Express

Business Standard

BOOKS:

Retail Marketing Sullivan & Adcock

Retail Management (A Strategic Approach) Barry Berman & Joel R.Evans

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CHAPTER-14

QUESTIONNAIRE

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QUESTIONNAIRE

1.Do you prefer to purchase from retail organization.

Yes No

2. How many retail organization you know of your city?

a. Less than 2

b. 2 to 3

c. 3 to 4

d. more than 4

3.Write the name according to preference of retail shop.

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4. How many time you usually go for purchase?

A. Less then two times or never

B. Two times in a month

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C. Four times in a month

D. More then four times

5. Do you make plan before your purchasing from retail shop.

Yes No

6. Are you satisfied with your purchasing every time.

Yes No

7. What characteristics attract you to purchase?

[i. Five star environment ii. Product line iii. Customer support iv. Convenience]

A only 1.

B 1 & 2.

C 1,2 & 3.

D All

8. Will you suggest other person to purchase from retail organization.

Yes No

9. Write some points of your satisfaction and dissatisfaction.

Reason for satisfaction:

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_________________________

_________________________

_________________________

Reason for dissatisfaction:

__________________________

__________________________

__________________________

10. Retails shops is which type of place for purchasing? According to your

perception.

Best good can not say

Thanks

Name : _________________________ Age :__________

Sex :______ Ph._________________

Address________________________________________________

___________________________________________________

4053. growth of indian retail sector & consumer perception – an insight

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