ravi's report
TRANSCRIPT
A
Project Study Report
On
“To Study of Vegetable buying behaviors
Of consumer in Jaipur City”
Submitted in partial fulfillment for the
Award of Degree of
Master of Business Administration
Submitted By: Submitted to: Ravi Kumar Bunkar Dr. R. P. Rajoria MBA part 2nd (Campus Director,PCE)
2008-2010
Department of Management Studies
Poornima college of Engineering, ISI-2, RIICO Ind. Area Sitapura,Jaipur-302022 (Raj.)
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Poornima College of Engineering (DMS)
Certificate
This is to certify that Mr. RAVI KUMAR BUNKAR, a student of Poornima College of
Engineering (DMS) has submitted his report on “To Study of Vegetable buying behaviors
Of consumer in Jaipur City “after successfully completing the project AT jaipur towards
fulfillment of the syllabus requirement prescribed by Rajasthan Technical University, Kota
for MBA Part II .
Dr. R.P. RajoriaCampus Director, PCE
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DECLARATION
I RaviKumar Bunkar S/o Mr.Ram Karan Bunkar declare that the project report title
“ToStudy of Vegetable buying behaviors Of consumer in Jaipur City” i after successfully
completing the project at jaipur based on my project study. This project report is my original
work and this has not been used for any purpose anywhere.
RaviKumar Bunkar PCE DMS2008-10 Batch
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Acknowledgement
From the depth of my heart I am very thankful to Mr. R.K. Agarwal (Advisor, PGC) &
Dr. R.P. Rajoria (Campus director, PCE) for giving me an opportunity to work on the
Management Research Project to broaden the knowledge base and understanding the
latest trends and developments in the Vegetable buying behaviors Of consumer.
I express my sincere thanks to my project guide, Ms Nidhi Tak Department of Management
Studies, Poornima college of engineering, Jaipur for guiding me right from the inception till the
successful completion of the project. I sincerely acknowledge him for extending their valuable
guidance, support for literature, critical reviews of project and the report and above all the moral
support he had provided to me with all stages of this project.
I would like to thank Rajasthan technical university for giving an opportunity to work on a
valuable project.
I would also like to thank the supporting staff of Poornima college of engineering, for their
help and cooperation throughout our project.
Ravi Kumar Bunkar
MBA 4th Sem.
(PCE) Marketing
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PREFACE
Since the last few years, the environment of the business world has completely
changed. The modern business placed on a very complex and intricate environment,
the constraints and opportunities provided by the nature of the economy and the
economic system, political and legal framework, social system, geographical and
demographic factors etc. have profound impact on the business. Many
developments have taken place during the post-independence period, which was
due to rapid industrialization. Developments have taken place in the technology
sector, finance sector, information technology sector, medical sector, engineering
sector,
This report is design to introduce about the vegetable buying bekaviour of consumer
In this report I introduce all retail store, local vendors, Indian economy and consumer
behaviour
This report provides the complete description of consumer behaviour. The report is
made in such a way so that the readers may find it easy to develop a clear-sighted
understanding about them.
I anticipate that the suggestions provided would prove to be useful source of
information for the understand and would facilitate growth.
:
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RESEARCH PROPOSAL
“To Study of Vegetable buying behaviors
Of consumer in Jaipur City”
Agriculture sector is the backbone of any economy Agricultural Sector of Indian Economy is one of the most significant parts of India. Agriculture is the only means of living for almost two-thirds of the employed class in India. the current revival in agriculture sector has been possible mainly due to a number of initiatives taken in the recent years. Like new retail store for vegetables come into the existence
To know the perception regarding vegetable buying behavior of consumer in jaipur city. What are impact of new big retail in consumer mind.
To cover all retail store, new vendors of vegetable seller organised and systematic vegetable shops or retails,
Descriptive research includes survey and fact finding enquiries of different Kinds. Quantitative research is based on the measurement of quantity or amount of data to analysis. In research methodology we have used random sampling
Today is the time of competitive era and at this time of cut throat competition every industry needs to survive.
. For the better understanding of this sector this internship helped a lot to interns.
To know the reasons why the customers are going towards retail and why they are intresed to buy vegetables from local vendor
Due to the financial & time constraints the study was limited to our place thus the conclusion arrived in the end rely in short term experience
Time constraints resource constraints were some of the limitations
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TABLE OF CONTENTS
Chapter
No. Chapter Name page N.
CERTIFICATE 2
DECLARATION 3
ACKNOWLEDGEMNT 4
PREFACE 5
RESEARCH PROPOSAL 6
EXECUTIVE SUMMERY 8
1. INTRODUCTION TO THE INDUSTRY 10
2. INTRODUCTION TO THE ORGANIZATIONS 66
3. RESEARCH METHODOLOGY 99
3.1 Title of the study 100
3.2 Duration of the project 101
3.3 Sample size and method of selecting sample 101
3.4 Type of Research 100
3.5 Objective of study 103
3.6 Limitations of study 104
4. ANALYSIS AND INTERPRETATION 107
5. FACTS AND FINDINGS 105
6. SWOT 120
7. RECOMMENDATIO AND SUGGESTIONS 125
8. CONCLUSION 126
9. APPENDIX 128
10. BIBLIOGRAPHY 133
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EXECUTIVE SUMMARY
Today is the time of competitive era and at this time of cut throat competition every
industry needs to survive.
Agriculture sector is the backbone of any economy. For the better understanding of
this sector this internship helped a lot to interns.
To know the reasons why the customers are going towards retail and why they are
intresed to buy vegetables from local vendor
For this purpose a research was done in different area of loans. For the research
part the data collection was the objective to know the experiences of the customer’s
perception, behaviour, their preferred. Another task is to make the customers aware
of new plans of retail sector.
The findings were important for the retail to make its strategy. The research told that
still people prefer local vendors rather then organised retaiil store. There is also a
good indication for the local vendors who are afraid of retai storre
I recommended the retail to give emphasis on advertising and launch some
innovative offer to woo the customers. The retail also needs to improve its customer
services and theprice policy.
At last I can say that through this benefited in a great way. They adopted my
recommendations in there marketing strategy; they have come with new advertising
campaign.
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ABOUT THE INDUSTRY
Introduction:
Agricultural Sector of Indian Economy is one of the most significant parts of India.
Agriculture is the only means of living for almost two-thirds of the employed class in India.
As being stated by the economic data of financial year 2006-07, agriculture has acquired 18
percent of India's GDP.
The agricultural sector of India has occupied almost 43 percent of India's geographical
area. Agriculture is still the only largest contributor to India's GDP even after a decline in the
same in the agricultural share of India. Agriculture also plays a significant role in the growth
of socio-economic sector in India.
In the earlier times, India was largely dependent upon food imports but the successive story
of the agricultural sector of Indian economy has made it self-sufficing in grain production.
The country also has substantial reserves for the same. India depends heavily on the
agricultural sector, especially on the food production unit after the 1960 crisis in food sector.
Since then, India has put a lot of effort to be self-sufficient in the food production and this
endeavor of India has led to the Green Revolution. The Green Revolution came into
existence with the aim to improve the agriculture in India.
Agriculture is one of the strongholds of the Indian economy and it accounts for 18.5 per
cent of the gross domestic product (GDP). Agriculture draws its significance from the vital
supply and demand links with the manufacturing sector and is a source of livelihood for the
rural population of India.
The year 2007–08 was a year of record food grain production and procurement. Food grain
production increased to an all-time record level of 230.67 million tones during 2007–08. The
production of the kharif crop suffered due to erratic rains and floods, the present Rabi
production is likely to be better and thus the overall food grain production in 2008–09 is
likely to be even higher. Similarly, oilseeds, milk, fruits and vegetables, and fish production
has been growing over the past few years to reach new levels.
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The average growth rate of agriculture and allied sectors during the last two years i.e.,
2006–07 and 2007–08 has been more than 4 per cent as compared to the average annual
growth of 2.5 per cent during the 10th Five-Year Plan.
The current revival in agriculture sector has been possible mainly due to a number of
initiatives taken in the recent years. While public sector investment in the farm sector has
grown from 1.8 per cent of sectoral gross domestic product (GDP) in 2000–01 to 3.5 per
cent in 2006–07, private sector investment has increased from 8.9 per cent in 2003–04 to
9.9 per cent in 2006–07.
The services enhanced by the Green Revolution in the agricultural sector of Indian
economy are as follows:
Acquiring more area for cultivation purposes
Expanding irrigation facilities
Use of improved and advanced high-yielding variety of seeds
Implementing better techniques that emerged from agricultural research
Water management
Plan protection activities through prudent use of fertilizers, pesticides, and cropping
applications
All these measures taken by the Green Revolution led to an alarming rise in the wheat and
rice production of India's agriculture. Considering the quantum leap witnessed by the wheat
and rice production unit of India's agriculture, a National Pulse Development Programmed
that covered almost 13 states was set up in 1986 with the aim to introduce the improved
technologies to the farmers. A Technology Mission was introduced in 1986 right after the
success of National Pulse Development Programmed to boost the oilseeds sector in Indian
economy. Pulses too came under this programmed. A new seed policy was planned to
provide entree to superior quality seeds and plant material for fruits, vegetables, oilseeds,
pulses, and flowers.
The Indian government also set up Ministry of Food Processing Industries to stimulate the
agricultural sector of Indian economy and make it more lucrative. India's agricultural sector
highly depends upon the monsoon season as heavy rainfall during the time leads to a rich
harvest. But the entire year's agriculture cannot possibly depend upon only one season.
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Taking into account this fact, a second Green Revolution is likely to be formed to overcome
the restrictions. An increase in the growth rate and irrigation area, improved water
management, improving the soil quality, and diversifying into high value outputs, fruits,
vegetables, herbs, flowers, medicinal plants, and bio-diesel are also on the list of the
services to be taken by the Green Revolution to improve the agriculture in India.
India with its current production of around 32 million MT of fruit, accounts for about 8% of
the world’s fruit production. The diverse agro-climatic zones the countries make it possible
to grow almost all varieties of fresh fruits and vegetables in India. The fruit production in
India has recorded a growth rate of 3.9%, whereas the fruit processing sector has grown at
about 20% per annum. However, the growth rates have been extensively higher for frozen
fruits & vegetables (121%) and dehydrated fruits & vegetables (24%). There exist over
4000 fruit processing units in India with an aggregate capacity of more than 12 lakh MT
(less than 4% of total fruits produced). It is estimated that around 20% of the production of
processed fruits is meant for exports, the rest caters to the defense, institutional sectors
and household consumption, Mango and mango-based products constitute 50% of exports.
Rajasthan has the eighth largest economy with a Net State Domestic Product (NSDP) of
over US$ 11.5 billion. Over the last ten years from 1994 to 2003, the state of Rajasthan
underwent growth at a Compounded Average Growth Rate (CAGR) of 6% increasing from
US$ 6.4 billion to US$ 11.5 billion.
In the years 1995-96 and 2001-02, the industrial sector of the state underwent a growth rate
of 6.9% per annum. The growth rate of the service sector was 7.4 %.
The main economy of Rajasthan is agrarian based. Agriculture is the leading economy of
the state accounting for 22.5 per cent. The total cultivated area of the state encompasses
about 20 million hectares and out of this only 20% of the land is irrigated.
The principal crops Barley, Wheat, Gram, Pulses, Oil Seeds, Bajra, Pulses, Jowar, Maize
Ground Nuts, fruits and vegetables and spices.
Cuisine of India
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The cuisine of India is characterized by its use of locally available resources, including
spices and vegetables grown across India and in some parts of India for the widespread
practice of vegetarianism across its society. Each Asian of Indian cuisine is characterised
by a wide assortment of dishes and cooking techniques. As a consequence, it varies from
region to region, reflecting the varied demographics of the ethnically diverse Indian
subcontinent.
India's religious beliefs and culture have played an influential role in the evolution of its
cuisine.]However, India's cuisine also evolved with the subcontinent's cross-cultural
interactions with the neighboring Middle East and Central Asia as well as the
Mediterranean, making it a unique blend of various cuisines from across Asia. The spice
trade between India and Europe is often cited as the main catalyst for the Age of Discovery.
The colonial period introduced European cooking styles to India adding to the flexibility and
diversity of Indian cuisine. Indian cuisine has had a remarkable influence on cuisines across
the world, especially those from Southeast Asia. In particular, curry, which originated in
India, is used to flavor food across Asia.
History and influences:
As a land that has experienced extensive immigration and intermingling through many
millennia, India's cuisine has benefited from numerous food influences. The diverse climate
in the region, ranging from deep tropical to alpine, has also helped considerably broaden
the set of ingredients readily available to the many schools of cookery in India. In many
cases, food has become a marker of religious and social identity, with varying taboos and
preferences (for instance, a segment of the Jain population will not consume any roots or
subterranean vegetables; see Jain vegetarianism). One strong influence over Indian foods
is the longstanding vegetarianism within sections of India's Hindu, Buddhist and Jain
communities. People who follow a strict vegetarian diet make up 20–42% of the population
in India, while less than 30% are regular meat-eaters
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Around 7000 BC, sesame, eggplant, and humped cattle had been domesticated in the
Indus Valley.[By 3000 BC, turmeric, cardamom, black pepper and mustard were harvested
in India. Many recipes first emerged during the initial Vedic period, when India was still
heavily forested and agriculture was complemented with game hunting and forest produce.
In Vedic times, a normal diet consisted of fruit, vegetables, meat, grain, dairy products and
honey. Over time, some segments of the population embraced vegetarianism, due to
ancient Hindu philosophy of ahimsa. This practice gained more popularity following the
advent of Buddhism and a cooperative climate where variety of fruits, vegetables, and
grains could easily be grown throughout the year. A food classification system that
categorised any item as saatvic, raajsic or taamsic developed in Ayurveda. Each was
deemed to have a powerful effect on the body and the mind
Later, invasions from Central Asia, Arabia, the Mughal empire, and Persia, and others had
a deep and fundamental effect on Indian cooking. Influence from traders such as the Arab
and Portuguese diversified subcontinental tastes and meals. As with other cuisines, Indian
cuisine has absorbed the new-world vegetables such as tomato, chilli, and potato, as
staples. These are actually relatively recent additions.
Islamic rule introduced rich gravies, pilafs and non-vegetarian fare such as kebabs,
resulting in Mughlai cuisine (Mughal in origin), as well as such fruits as apricots, melons,
peaches, and plums. The Mughals were great patrons of cooking. Lavish dishes were
prepared during the reigns of Jahangir and Shah Jahan. The Nizams of Hyderabad state
meanwhile developed and perfected their own style of cooking with the most notable dish
being the Biryani.
During this period the Portuguese and British introduced foods from the New World such as
potatoes, tomatoes, squash, and chilies as well as cooking techniques like baking.
The staples of Indian cuisine are rice, atta (whole wheat flour), and a variety of pulses, the
most important of which are masoor (most often red lentil), chana (bengal gram), toor
(pigeon pea or yellow gram), urad (black gram) and mung (green gram). Pulses may be
used whole, dehusked, for example dhuli moong or dhuli urad, or split. Pulses are used
extensively in the form of dal (split). Some of the pulses like chana and "Mung" are also
processed into flour (besan).
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Most Indian curries are cooked in vegetable oil. In North and West India, groundnut oil has
traditionally been most popular for cooking, while in Eastern India, Mustard oil is more
commonly used. In South India, coconut oil and Gingelly Oil is common. In recent decades,
sunflower oil and soybean oil have gained popularity all over India. Hydrogenated vegetable
oil, known as Vanaspati ghee, is also a popular cooking medium that replaces Desi ghee,
clarified butter (the milk solids have been removed).
The most important/frequently used spices in Indian cuisine are chilli pepper, black mustard
seed (rai), cumin (jeera), turmeric (haldi, manjal), fenugreek (methi), asafoetida (hing,
perungayam), ginger (adrak, inji), coriander, and garlic (lassan, poondu). Popular spice
mixes are garam masala which is usually a powder of five or more dried spices, commonly
including cardamom, cinnamon, and clove. Each region, and sometimes each individual
chef, has a distinctive blend of Garam Masala. Goda Masala is a popular spice mix in
Maharashtra. Some leaves are commonly used like tejpat (cassia leaf), coriander leaf,
fenugreek leaf and mint leaf. The common use of curry leaves is typical of all South Indian
cuisine. In sweet dishes, cardamom, nutmeg, saffron, and rose petal essence are used.
The term "curry" is usually understood to mean "gravy" in India, rather than "spices." The
term Desi Diet indicates a Diet followed by Indians
Geographical varieties:
Northern:
North Indian cuisine is distinguished by the proportionally high use of dairy products; milk,
paneer, ghee (clarified butter), and yoghurt (yogurt, yoghourt) are all common ingredients.
Gravies are typically dairy-based. Other common ingredients include chilies, saffron, and
nuts.
North Indian cooking features the use of the "tawa" (griddle) for baking flat breads like roti
and paratha, and "tandoor" (a large and cylindrical charcoal-fired oven) for baking breads
such as naan, and kulcha; main courses like tandoori chicken also cook in the tandoor.
Other breads like puri and bhatoora, which are deep fried in oil, are also common. Goat and
lamb meats are favored ingredients of many northern Indian recipes.
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The samosa is a popular North Indian snack, and now commonly found in other parts of
India, Central Asia, North America, and the Middle East. A common variety is filled with
boiled, fried, or mashed potato. Other fillings include minced meat, cheese (paneer),
mushroom (khumbi), and chick pea.
The staple food of most of North India is a variety of lentils, vegetables, and roti (wheat
based bread). The varieties used and the method of preparation can vary from place to
place. Popular snacks, side-dishes and drinks include mirchi bada, buknu, bhujiya, chaat,
kachori, imarti, several types of pickles (known as achar), murabba, sharbat, aam panna
and aam papad. Popular sweets are known as mithai (means sweetmeat in Hindi), such as
gulab jamun, jalebi, peda, petha, rewadi, gajak, bal mithai, singori, kulfi, falooda, khaja, ras
malai, gulkand, and several varieties of laddu, barfi and halwa.
Some common North Indian foods such as the various kebabs and most of the meat dishes
originated with Muslims’ incursions into the country. Considering their shared historic and
cultural heritage, Pakistani cuisine and North Indian cuisine are very similar. However,
Brazilian cuisine through the Portuguese influence has become very popular in certain parts
of Punjab.
Eastern:
East Indian cuisine is famous for its desserts, especially sweets such as rasagolla,
chumchum, sandesh, rasabali, chhena poda, chhena gaja, chhena jalebi and kheeri. Many
of the sweet dishes now popular in Northern India initially originated in the Bengal and
Orissa regions. Apart from sweets, East India cuisine offers delights of posta (poppy
seeds).
Traditional cuisines of Orissa, Bengal, and Assam are delicately spiced. General
ingredients used in Oriya, Bengali, and Assamese curries are mustard seeds, cumin seeds,
nigella, green chillies, cumin paste and the spice mix panch phoron or panch phutana.
Mustard paste, curd, nuts, poppy seed paste and cashew paste are preferably cooked in
mustard oil. Curries are classified into bata (paste), bhaja (fries), chochchoree (less spicy
vapourized curries) and jhol (thin spicy curries).These are eaten with plain boiled rice or
ghonto (spiced rice). A traditional breakfast includes pantabhat or pakhaal, as well as
cereals such as puffed rice or pressed rice, in milk, often with fruits. The cuisine of
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Bangladesh is very similar to eastern Indian cuisine, particularly that of West Bengal. Fish
and shellfish are commonly consumed in the eastern part of India. The popular vegetable
dishes of Orissa are Dalma and Santula. The most popular vegetable dish of Bengal is
Sukto. Deep fried, shallow fried and mashed vegetables are also very popular. As in
southern India, rice is the staple grain in Eastern India too. A regular meal consists of
lentils, a primary non vegetarian side dish usually made of fish and a few other secondary
side dishes made of vegetables.
Southern:
South Indian cuisine is distinguished by a greater emphasis on rice as the staple grain, the
ubiquity of sambar and rasam (also called saaru and rasa), a variety of pickles, and the
liberal use of coconut and particularly coconut oil and curry leaves. Curries called
Kozhambu are also popular and are typically vegetable stews cooked with spices, tamarind
and other ingredients. The dosa, poori, idli, vada, bonda and bajji are typical South Indian
favorites. These are generally consumed as part of breakfast. Other popular dishes include
Kesaribath, Upma, Pulao, Puliyodharai and Thengai Sadham. Hyderabadi biryani, a
popular type of biryani, reflects the diversity of south Indian cuisine. South Indian cuisine
obtains its distinct flavours by the use of tamarind, coconuts, lentils, rice and a variety of
vegetables.Udupi cuisine is one of the popular cuisines of South India.
Andhra, Chettinad, Tamil, Hyderabadi, Mangalorean, and Kerala cuisines each have
distinct tastes and methods of cooking. In fact each of the South Indian states has a
different way of preparing sambar; a connoisseur of South Indian food will very easily tell
the difference between sambar from Kerala, sambar from Tamil cuisine, Sambar from
Karnataka and pappu chaaru in Andhra cuisine.Some popular dishes include the Biriyani,
Ghee Rice with meat curry, seafood (prawns, mussels, mackerel) and paper thin Pathiris
from Malabar area.
Western:
Western India has three major food groups: Gujarati, Maharashtrian and Goan.
Maharashtrian cuisine has mainly two sections defined by the geographical sections. The
coastal regions, geographically similar to Goa depend more on rice, coconut, and fish. The
hilly regions of the Western Ghats and Deccan plateau regions use groundnut in place of
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coconut and depend more on jowar (sorghum) and bajra (millet) as staples. Saraswat
cuisine forms an important part of coastal Konkani Indian cuisine. Gujarati cuisine is
predominantly vegetarian. Many Gujarati dishes have a hint of sweetness due to use of
sugar or brown sugar. Goan cuisine is influenced by the Portuguese colonization of Goa.
North Eastern:
The food of the North East is very different from other parts of India. This area's cuisine is
more influenced by its neighbours, namely Burma and the People's Republic of China. For
example it uses less of the well known spices that are popular in other parts of India. Yak is
a popular meat in this region of India.
Popularity and influence outside India
Indian cuisine is one of the most popular cuisines across the globeThe cuisine is popular
not only among the large Indian diaspora but also among the mainstream population of
North America and Europe. In 2003, there were as many as 10,000 restaurants serving
Indian cuisine in England alone. A survey held in 2007 revealed that more than 1,200
Indian food products have been introduced in the United States since 2000. According to
Britain's Food Standards Agency, the Indian food industry in the United Kingdom is worth
£3.2 billion, accounts for two-thirds of all eating out and serves about 2.5 million British
customers every week.
Apart from Europe and North America, Indian cuisine is popular in South East Asia too
because of its strong historical influence on the region's local cuisines. Indian cuisine has
had considerable influence on Malaysian cooking stylesand also enjoys strong popularity in
Singapore. Indian influence on Malay cuisine dates back to 19-century. Other cuisines
which borrow Indian cooking styles include Vietnamese cuisine, Indonesian cuisine and
Thai cuisine. The spread of vegetarianism in other parts of Asia is often credited to ancient
Indian Buddhist practices. Indian cuisine is also fairly popular in the Arab world because of
its similarity and influence on Arab cuisine.
The popularity of curry, which originated in India, across Asia has often led to the dish being
labeled as the "pan-Asian" dish. Curry's international appeal has also been compared to
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that of pizza. Though the tandoor did not originate in India, Indian tandoori dishes, such as
chicken tikka made with Indian ingredients, enjoy widespread popularity. Historically, Indian
spices and herbs were one of the most sought after trade commodities. The spice trade
between India and Europe led to the rise and dominance of Arab traders to such an extent
that European explorers, such as Vasco da Gama and Christopher Columbus, set out to
find new trade routes with India leading to the Age of Discovery.
Beverages:
Tea is a staple beverage throughout India; the finest varieties are grown in Darjeeling and
Assam. It is generally prepared as masala chai, wherein the tea leaves are boiled in a mix
of water, spices such as cardamom, cloves, cinnamon, and ginger, and large quantities of
milk to create a thick, sweet, milky concoction. Different varieties and flavors of tea are
prepared to suit different tastes all over the country. Another popular beverage, coffee, is
largely served in South India. One of the finest varieties of Coffea arabica is grown around
Mysore, Karnataka, and is marketed under the trade name "Mysore Nuggets". Indian filter
coffee, or kaapi, is also especially popular in South India. Other beverages include nimbu
pani (lemonade), lassi, chaach, badam doodh (almond milk with nuts and cardamom),
sharbat and coconut water. India also has many indigenous alcoholic beverages, including
palm wine, fenny and Indian beer. There's also bhang, prepared using cannabis, and
typically consumed, especially in North India, during Holi and Vaisakhi. However the
practice of drinking a specific beverage with a meal, or wine and food matching, is not
traditional or common in India.
Although the above listed beverages are popular, people prefer to consume drinking water
with their food because drinking water does not overshadow the taste of the food. In fact it
is customary to offer drinking water to guests before serving any hot or cold drinks.
Fruits and Vegetables:
The fruit and vegetable processing industry in India is highly decentralized having wide
capacities. The diverse agro- climatic zones make it possible to grow almost all varieties of
fresh fruits and green vegetables in India. India is the second largest producer of fresh
vegetables in the world (ranks next to China) and accounts for about 15% of the world’s
production of vegetables.
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Production area:
Vegetables are typically grown in India in field conditions; the concept is opposed to the
cultivation of vegetables in green houses as practiced in developed countries for high
yields. The fruits and vegetables considered important by the horticulture board of India are
mostly grown in the areas of Jammu & Kashmir, Himachal Pradesh, hilly regions of North
Uttar Pradesh, Tamil Nadu, Maharashtra, Karnataka, Gujarat, Andhra Pradesh, Assam,
Madhya Pradesh, Rajasthan, Punjab, Tripura, West Bengal and Orissa.
Growth promotional activities:
Since liberalization and withdrawal of excise duty on fruit and vegetable products there has
been significant rise in the growth rate of the industry Out of 370 million tons of fruit
production in the world, India accounts for 30 million tons. No industrial license is required
for setting up F & V P industries; setting-up 100% EOUs require specific Govt. approvals.
Many subsidies, irrigation plans, loans, pre and post harvesting schemes led to the
following figures of production.
Fruit & vegetable Total production M.
T
India's production
status
Mango 10 million tons World's largest
producer
Banana 7 million tons World's largest
producer
Pineapple 12.6% of world
production
World's 4th largest
producer
Oranges 6.3% of world
production
World's 5th largest
producer
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Grapes - World record in
productivity
Onion - World's 2nd largest
producer
Cauliflower World's 3rd largest
producer
Vegetables:
More than 40 kinds of vegetables belonging to different groups, namely, solanaceous,
cucurbitaceous, leguminous, cruciferous (cole crops), root crops and leafy vegetables are
grown in India in tropical, sub-tropical and temperate regions. Important vegetable crops
grown in the country are tomato, onion, brinjal, cabbage, cauliflower, okra and peas.
India is next only to China in area and production of vegetables and occupies prime position
in the production of cauliflower, second in onion and third in cabbage in the world. The area
and production of major vegetables during 2004-05 is estimated at 6.30 million ha with a
production of 93.0 million tonnes and average productivity of 14.8 tonnes per ha. The
production has increased by 5.7 per cent.
India is the fruit and vegetable basket of the world. India being a home of wide variety of
fruits and vegetables holds a unique position in production figures among other countries.
Over 90% of India’s exports in fresh products go to west Asia and East European markets.
However, it needs to augment its food and processing industry at a mega scale, according
to an agriculture consultant.
India’s exports of Fresh Fruit and Vegetable have increased Rs. 2437.12 Crores in 2007-
08. Which is including the products like Fresh Onion, Walnut, Fresh Mangos, Fresh Grapes
and other fresh Fruits & Vegetables?
Abundant investment opportunities are there in expanding the export market. An increasing
21
acceptance of new products with market development efforts has been witnessed lately
given the fact that there is a good international demand for certain fruits and vegetable
products. India ranks fifth in the world in cropped area under cultivation and production of
potatoes. India produces 41% of world’s mangoes, 23%bananas, 24% cashew nuts, 36 %
green peas and 10% onion the total export value of the main exporting fruit crop from India
is mango. Exports of mangoes, grapes, mushrooms have started going to the United
Kingdom, Middle East, Singapore and Hong Kong. And among vegetable, onion occupies
first position Potatoes and green vegetables like okra, bitter gourd, green chilies have good
export potential.
Several customs are associated with the manner of food consumption. Traditionally, meals
are eaten while seated either on the floor or on very low stools or cushions. Food is most
often eaten without cutlery, using instead the fingers of the right hand. However, these
traditional ways of dining are being influenced by eating styles from other parts of the world.
Eating with your hands is considered important in Indian etiquette because a person eating
with his hands knows the exact temperature of food before the morsel hits his mouth thus
preventing blisters in mouth due to consumption of hot food.
Traditional serving styles vary from region to region in India. A universal aspect of
presentation is the thali, a large plate with samplings of different regional dishes
accompanied by raita, breads such as naan, puri, or roti, and rice. In South India, a cleaned
banana leaf is often used as a hygienic, visually interesting and environmentally friendly,
alternative to plates.
In Southern India there is a beverage served cold known as Panner Soda or Gholi Soda
which is a mixture of carbonated water, rose water, and sugar. Another southern beverage
is rose milk, which is served cold.
Agriculture has remained the mainstay of the Indian economy, with vegetables like potato
acquiring a special place in the sector. To further enable the importance of potato business,
the Indian Council of Agricultural Research (ICAR), Central Potato Research Institute
(CPRI), Indian Potato Association (IPA) and the Centre for Agriculture & Rural
Development (CARD) are jointly presenting Agrotech 2008. The exhibition will be held from
9th-12th December, 2008 at the NASC Complex, Pusa Road, New Delhi, India, and will
22
uncover an entire gamut of products, technology and machines used in the production of
potato products. Along with the exhibition, a global conference on the prospects and
benefits of potato will also be held at the venue. High profile scientists and entrepreneurs
will be attending the conference to share and exchange their ideas and opinions in the
Global Potato Conference 2008. The last edition of the exhibition was a great success and
saw the presence of eminent scientists, agriculturists, industrial experts, among others.
With even a wider presence expected in this edition, we are hopeful of creating success
once again.
India the land of the greenery is one of the major vegetable suppliers in the world giving a
great hand to the Indian exporting system. Vegetable exporting is one of the most important
crops for the developing country like India. Indian vegetables suppliers & Indian vegetables
exporters are concentrating mainly in vegetable such as onion, carrot, French beans,
potato, lemon, tapioca, tomato, etc. They have gained the reputation for supplying good
quality and hygienic vegetables to valued customers, with committed and qualified work
force to meet the regular challenges and timely deliveries.
Most of the people from the entire world depend upon the Indian market for good quality
stuff so the Indian vegetables suppliers & Indian vegetables exporters take good care about
the quality of the vegetables. In Indian market we can see a large variety of vegetables that
are tasty and also have high nutritious value. Hence the vegetable products are leading
Indian economy a lot. Indian vegetables suppliers & Indian vegetables exporters are giving
more attention to the high quality stuff and good packing of vegetables.
Indian vegetables suppliers, Indian vegetables exporters:
Health is a matter of concern for everyone. The key to good health is adequate
consumption of nutritious fruits and vegetables. To promote this healthy living, Indian
vegetables suppliers & Indian vegetables exporters supply premium quality fruits and
vegetables. Fresh & nutritional fruits and vegetables provide significant protection against
cancer, heart diseases and other nutritional ailments and are recommended for every age
group.
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Customer’s health is the top most priority of vegetable suppliers. Thus, Indian vegetables
suppliers & Indian vegetables exporters work with complete sincerity and loyalty to supply
the best quality fruits and vegetables. To promote easy accessibility, Indian vegetables
suppliers & Indian vegetables exporters’ market products at most nominal prices making
them highly demanded distributors.
Superior quality vegetables and fruits are handpicked from the farms and are further kept
under optimum storage conditions. Indian vegetables suppliers & Indian vegetables
exporters take extreme care in sorting out fruits and vegetables, continually eliminating the
rotting ones; ensuring that only the best fruits and vegetables reach you from the vegetable
suppliers.
Besides being colorful and nutritious, Indian vegetables contain antioxidants that get rid of
toxins in the body. Indian vegetables suppliers & Indian vegetables exporters supply high
yielding varieties of vegetables and have adequate packaging facility that helps in retaining
purity, freshness and avoid infestation and decay. The Indian vegetables suppliers & Indian
vegetables exporters have an extensive distribution network across the globe that ensures
timely delivery at competitive prices.
Indiabizone takes pride in serving esteemed clients who have trusted us over the years for
our quality listings and sound business practices. Hence we invite you to the unique section
wherein details of Indian vegetables suppliers & Indian vegetables exporters are well
arranged for you to access. So contact your vendor today and be a part of the healthy
eating regime.
Cost of living, already at a 13-year peak, is rising again. Annual inflation, based on
wholesale price index (WPI), climbed further to 11.89% in the week ended June 28,
outpacing the previous week’s 11.63% and 4.42% during the corresponding week of the
previous year.
The government also sharply revised the inflation figure for the week ended May 3 by 0.9%
to 8.73% as compared to the provisional data of 7.83%. This suggests that inflation may be
currently close to 13%, forcing RBI to further tighten monetary policy at its review later this
month, economists said.
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The latest spurt in inflation is fanned by costlier food items and manufactured items as the
second-round effect of price increase in auto fuel percolated into the economy. Food items
like fruits and vegetables, cooking oil, textiles, fertilizers, pesticides and telephone
instruments became costlier during the week. Food products rose 0.3 per cent and primary
articles were up 0.9 per cent. Likewise, vegetables were up 3.7% and chemicals and
products rose 1.2 per cent. However, iron and steel fell 1.4 per cent and fuel remained
unchanged.
The finance ministry stated that prices of 30 essential commodities, which include food
grains, pulses, edible oils, vegetables, dairy products and some other commodities
including kerosene, soap and safety matches have more or less stabilized. In the primary
articles group, out of a total of 98 articles, 12 articles have shown a decline in prices as
compared to June 21. These include wheat, rice, maize, garlic, cabbage, cumin, black
pepper, ginger and Niger seed.
Prices of another 55 articles remained steady. Among manufactured products, out of a total
320 commodities, 278 have shown no increase in prices over the previous week. In case of
16 commodities, there is a decline in prices. These include penicillin, imported edible oil, pig
iron, steel products, and cotton seed oil and de-oiled, the finance ministry stated.
According to government data, fruits and vegetables became costlier by 2%, non-food
articles in the range of 2% to 7%, coconut oil by 11%, rape and mustard oil by 5% and
soybean oil by 5%. Cotton yarn hanks became costlier by 9%, polyester staple fiber by 8%,
cotton knitted garments by 3%, cement by 1% and telephone instruments by 19%. Prices of
iron products eased in the range of 2% to 8%.
It is estimated that steel and steel products (used in industries like auto, housing, white
goods, capital goods etc) contribute almost 21 per cent to inflation. Cement prices are
expected to remain soft, thanks to capacity addition.
Said Crisis principal economist DK Joshi: ‘Although the pace of inflation was slower in the
week under scrutiny, even a marginal increase at the current level would be highly
uncomfortable and unwelcome. Looking at the magnitude of revision in the provisional WPI
figures, one gets the impression that inflation may be ruling at close to 13% now. To lower
25
consumption, the RBI may further tighten monetary policy; particularly raise the share of
cash that banks have to park with it by about 50 bps later this month.
Last month, RBI had raised its benchmark interest rate twice to a six-year high of 8.5% and
lifted its cash reserve ratio to 8.75% to prevent money supply in the banking system from
fueling inflation.
Last Tuesday, Finance Minister P. Chidambaram said the government was relying on
monetary policy to cool demand and calm prices. Last month, the RBI had raised its main
lending rate by 75 basis points and increased banks' reserve requirement by 50 basis
points to contain inflation expectations. Its next scheduled review is on July 29, but it can
act before then. Market is expecting further tightening of monetary policy. If at all the RBI
touches the rate at which it makes short-term lending to banks, it may be an increase of 25
bps.
According to Ms Sonal Varma, India economist, Lehman Brothers, the RBI is likely to hike
repo rates by 25 basis points in the monetary policy, while a hike of 50 basis points in the
CRR could happen anytime in the July-September quarter. The key challenge before the
RBI now is to try and prevent the second round effects of inflation, such as producers
passing on higher input cost to consumers and workers demanding increase in wages due
to higher cost of living. ‘The RBI has already hiked interest rates to moderate credit growth
and we expect them to maintain their tightening bias. The rate hikes should help slow down
credit growth,’
India gains a foothold in the international fruit and vegetable
market:
With an annual output of 127 million tones of fruit and vegetables, India lies second in the
world producing country rankings, after China. Since the end of the 1990s, it has been
eyeing up the export markets, in the hope of gaining in international visibility and repute.
However, yields are still low, and most of what is produced is either consumed in India or
lost as a result of poor post harvest management. Moreover, barely 2% of the fruit and
26
vegetable crop is processed, and India accounts for just 1.2% of international trade in these
products.
In April, CIRAD’s Fruit and Horticultural Crops Department (FLHOR) received a new remit
from APEDA (Agricultural and processed food Products Export Development Authority), a
branch of the Indian Ministry of Trade. Its task is to optimize cropping with a view to
exporting tropical (okra or lady’s finger, bitter melon and pointed gourd) and European
vegetables (mange tout peas, French beans, mini-sweet corn, sweet corn, etc).
CIRAD’s researchers are basing their work on a similar project conducted with APEDA for
lynches between 1998 and 2003. The aim was to set up an export chain to Europe. This
initial project was a huge success: in 2003, 350 tonnes of lychees were exported, compared
to 5 tonnes in 1998. Moreover, given the difference in hemisphere, they were exported in
the off-season in relation to supplies from Madagascar and Reunion. More recently, CIRAD
also worked to establish a pineapple export chain to Dubai, in the United Arab Emirates.
The first containers were shipped in December 2005.
CIRAD is required to use field observations and produce technical advice notes to advise
farmers and enable them to ensure that their products satisfy the standards imposed by
importing countries. For instance, this concerns the phytosanitary products used, types of
packaging, public health criteria and also child labor. "Diseases, inappropriate fertilizer
rates, nutrient (iron, nitrogen, etc) deficiencies or surpluses, transport and traceability; we
assess and correct all kinds of problems", explains Christian Didier, project leader at
CIRAD-FLHOR. "Thanks to the progress made on export crops, quality standards for all
fruit and vegetables crops will also progress", he adds. Development staff has been trained
to follow up farmers in the field, throughout the year. CIRAD is also involved in setting up
research stations, as was the case with lychees in Bihar State, which accounts for 75% of
national output.
Asia’s largest vegetable market near Jaipur soon:
Jaipur, Aug 21: Asia’s largest ever fruit and vegetable mandi (yard) is coming up at Muhana
village, around 25 km from here. The mandi, which is to occupy 150 hectare, is likely to cost
Rs 100 crore. Infrastructure development has already started around the mandi.
27
The Rajasthan government has also allocated a budget of Rs 55 crore for the development
of the mega-yard, slated to become operational by 2006.
“The mandi will have facilities like bank branches, post offices, insurance agents and a
hospital,” Kesar Singh, the mandi’s secretary, said.
As planned, the complex will house 2,000 shops, establishments and cold storages.
Mr Singh said the mandi will have commodious and eco-friendly waste disposal facilities.
28
“This mandi will surely change our lifestyle. It will help us sell our produce as well as throw
open a gamut of other opportunities,” said Ramlal Gujar, a local farmer.
“It’s a dual benefit for us since it assures different employment avenues for our children,”
said Chand Ram, another farmer.
At the same time, local household buyers like SK Sharma bemoan the increased distance
to the mandi and complain that daily trips will have to be curtailed in favor of weekend visits.
Consumer behavior:
As a consumer we are all unique and this uniqueness is reflected in the consumption
pattern and process purchase. The study of consumer behavior provides us with reasons
why consumers differ from one another in buying using products and services. We receive
stimuli from the environment and the specifics of the marketing strategies of different
products and services, and responds to these stimuli in terms of either buying or not buying
product. In between the stage of receiving the stimuli and responding to it, the consumer
goes through the process of making his decision.
An important part of the marketing process is to understand why a customer or buyer
makes a purchase.
Without such an understanding, businesses find it hard to respond to the customer’s needs
and wants.
Marketing theory traditionally splits analysis of buyer or customer behaviour into two broad
groups for analysis – Consumer Buyers and Industrial Buyers
Consumer buyers are those who purchase items for their personal consumption
Industrial buyers are those who purchase items on behalf of their business or organization
For a marketing manager, the challenge is to understand how customers might respond to
the different elements of the marketing mix that are presented to them.
29
If management can understand these customer responses better than the competition, then
it is a potentially significant source of competitive advantage.
Consumer behavior is the study of when, why, how, where and what people do or do not
buy products It blends elements from psychology, sociology, social, anthropology and
economics. It attempts to understand the buyer decision making process, both individually
and in groups. It studies characteristics of individual consumers such as demographics and
behavioral variables in an attempt to understand people's wants. It also tries to assess
influences on the consumer from groups such as family, friends, reference groups, and
society in general
.Customer behaviour study is based on consumer buying behaviour, with the customer
playing the three distinct roles of user, payer and buyer. Relationship marketing is an
influential asset for customer behaviour analysis as it has a keen interest in the re-discovery
of the true meaning of marketing through the re-affirmation of the importance of the
customer or buyer. A greater importance is also placed on consumer retention, customer
relationship management, personalization, customisation and one-to-one marketing. Social
functions can be categorized into social choice and welfare functions.
Each method for vote counting is assumed as a social function but if Arrow’s possibility
theorem is used for a social function, social welfare function is achieved. Some
specifications of the social functions are decisiveness, neutrality, anonymity, monotonocity,
unanimity, homogeneity and weak and strong Paretooptimality. No social choice function
meets these requirements in an ordinal scale simultaneously. The most important
characteristic of a social function is identification of the interactive effect of alternatives and
creating a logical relation with the ranks. Marketing provides services in order to satisfy
customers. With that in mind, the productive system is considered from its beginning at the
production level, to the end of the cycle, the consumer (Kioumarsi et al., 2009).
Belch and Belch define consumer behavior as 'the process and activities people engage in
when searching for, selecting, purchasing, using, evaluating, and disposing of products and
services so as to satisfy their needs and desires'.
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Black box model:
ENVIRONMENTAL FACTORS BUYER'S BLACK BOXBUYER'S
RESPONSEMarketing
Stimuli
Environmental
Stimuli
Buyer
Characteristics
Decision
Process
Product
Price
Place
Promotion
Economic
Technical
Political
Cultural
Attitudes
Motivation
Perceptions
Personality
Lifestyle
Problem
recognition
Information
search
Alternative
evaluation
Purchase
decision
Post-purchase
behavior
Product choice
Brand choice
Dealer choice
Purchase timing
Purchase
amount
The black box model shows the interaction of stimuli, consumer characteristics, decision
process and consumer responses.[1] It can be distinguished between interpersonal stimuli
(between people) or intrapersonal stimuli (within people). The black box model is related to
the black box theory of behaviorism, where the focus is not set on the processes inside a
consumer, but the relation between the stimuli and the response of the consumer. The
marketing stimuli are planned and processed by the companies, whereas the environmental
stimuli are given by social factors, based on the economical, political and cultural
circumstances of a society. The buyer’s black box contains the buyer characteristics and
the decision process, which determines the buyer’s response.
The black box model considers the buyers response as a result of a conscious, rational
decision process, in which it is assumed that the buyer has recognized the problem.
However, in reality many decisions are not made in awareness of a determined problem by
the consumer.
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Information search:
Once the consumer has recognised a problem, they search for information on products and
services that can solve that problem. Belch and Belch (2007) explain that consumers
undertake both an internal (memory) and an external search.
Sources of information include:
Personal sources
Commercial sources
Public sources
Personal experience
The relevant internal psychological process that is associated with information search is
perception. Perception is defined as 'the process by which an individual receives, selects,
organises, and interprets information to create a meaningful picture of the world'
The selective perception process:
Stage Description:
- Selective exposure consumers select which promotional messages they will expose
themselves to.
- Selective attention consumers select which promotional messages they will pay attention
to
- Selective comprehension consumer interpret messages in line with their beliefs, attitudes,
motives and experiences
- Selective retention consumers remember messages that are more meaningful or
important to them
The implications of this process help develop an effective promotional strategy, and select
which sources of information are more effective for the brand.
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Steps of buyer’s behaviour
33
Information evaluation:
At this time the consumer compares the brands and products that are in their evoked set.
How can the marketing organization increase the likelihood that their brand is part of the
consumer's evoked (consideration) set? Consumers evaluate alternatives in terms of the
functional and psychological benefits that they offer. The marketing organization needs to
understand what benefits consumers are seeking and therefore which attributes are most
important in terms of making a decision.
Purchase decision:
Once the alternatives have been evaluated, the consumer is ready to make a purchase
decision. Sometimes purchase intention does not result in an actual purchase. The
marketing organization must facilitate the consumer to act on their purchase intention. The
provision of credit or payment terms may encourage purchase, or a sales promotion such
as the opportunity to receive a premium or enter a competition may provide an incentive to
buy now. The relevant internal psychological process that is associated with purchase
decision is integration.
Postpurchase evaluation:
The EKB model was further developed by Rice (1993) which suggested there should be a
feedback loop, Foxall (2005) further suggests the importance of the post purchase
evaluation and that the post purchase evaluation is key due to its influences on future
purchase patterns.
Types of Consumer Buying Behavior
Types of consumer buying behavior are determined by:
•Level of Involvement in purchase decision. Importance and intensity of interest in a product
in a particular situation.
•Buyers level of involvement determines why he/she is motivated to seek information about
a certain products and brands but virtually ignores others. High involvement purchases--
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Honda Motorbike, high priced goods, products visible to others, and the higher the risk the
higher the involvement.
Types of risk:
Personal risk
Social risk
Economic risk
The four type of consumer buying behavior are:
Routine Response/Programmed Behavior:
--Buying low involvement frequently purchased low cost items; need very little search and
decision effort; purchased almost automatically. Examples include soft drinks, snack foods,
milk etc.
Extensive Decision Making:
/Complex high involvement, unfamiliar, expensive and/or infrequently bought products. High
degree of economic/performance/psychological risk. Examples include cars, homes,
computers, education. Spend a lot of time seeking information and deciding.Information
from the companies MM; friends and relatives, store personnel etc. Go through all six
stages of the buying process.
Impulse buying:
The purchase of the same product does not always elicit the same Buying Behavior.
Product can shift from one category to the next For example:Going out for dinner for one
person may be extensive decision making (for someone that does not go out often at all),
but limited decision making for someone else.
35
Limited Decision Making:
--Buying product occasionally. When you need to obtain information about unfamiliar brand
in a familiar product category, perhaps. Requires a moderate amount of time for information
gathering. Examples include Clothes--know product class but not the brand.
Factors of influences:
A consumer’s buyer behavior is influenced by four major factors; cultural, social, personal,
and psychological factors. These factors cause consumers to develop product and brand
preferences. Although many of these factors cannot be directly controlled by marketers,
understanding of their impact is essential as marketing mix strategies can be developed to
appeal to the preferences of the target market.
When purchasing any product, a consumer goes through a decision process. This process
consists of up to five stages: problem recognition, information search, evaluation of
alternatives, purchase decisions and post purchase behavior. The length of this decision
process will vary, ranging from a shorter routine response behavior, to limited problem
solving and a more comprehensive extensive problem solving. A consumer may not act in
isolation in the purchase, but rather may be influenced by any of several people in various
roles. The number of people involved in the buying decision increases with the level of
involvement and complexity of the buying decision behavior.
Buyer- the person who makes the actual purchase.
CULTURAL factors include a consumer's culture, subculture and social class. These factors
are often inherent in our values and decision processes.
Other people often influence a consumer’s purchase decision. The marketer needs to know
which people are involved in the buying decision and what role each person plays, so that
marketing strategies can also be aimed at these people.
Data from the Consumer Expenditure Survey are used in a number of different ways by a
variety of users. Market researchers find the data useful in analyzing the demand for groups
of goods and services. The data allow them to track spending trends of different types of
36
consumer. Government and private agencies use the data to study the welfare of particular
segments of the population, such as of consumer units with a reference person age 65 and
over or under age 25, or for low-income consumer units. Economic policymakers use the
data to study the impact of policy changes in the welfare of different socioeconomic groups.
Researchers use the data in a variety of
Cultural Factors:
In a diversified country like India cultural factors exert the broadest and deepest influence
on consumer behavior; we will look at the role played by the buyer’s culture, subculture,
and social class.
Culture: Culture is the most fundamental determinant of a person’s wants and behavior.
Whereas lower creatures are governed by instinct, human behavior is largely learned. The
child growing up in a society leans a basic set of values, perceptions, preferences and
behaviors through a process of socialization involving the family and other key
institution .Thus a child growing up in America is exposed to the following values:
37
Achievement and success, activity , efficiency and practicality, progress, material comfort,
individualism, freedom, external comfort, humanitarianism, and youthfulness.
Subculture:
Each culture contain smaller group of subculture that provide more specific identification
and socialization for its members. Four types of subculture can be distinguished .Nationality
groups such as the Irish, polish, Italians, and Puerto Ricans are found with in large
communities and exhibits distinct ethnic tastes and Jews represent subculture with specific
culture preference and taboos.
Social Class:
Virtually all human societies exhibit social stratification. Stratification sometimes takes the
form of a caste system where the members of different caste are reared for certain roles
and cannot change their caste membership .More frequently; stratification takes the form of
social classes.
Social Classes have several characteristics. First, Person with in each social class tends to
behave more alike than persons from two different social classes. Second, persons are
perceived as occupying inferior or superior positions according to their social class. Third, a
person’s social class is indicated by a number of variables, such as occupation, income,
wealth, education , and value orientation, rather than by any single variable , fourth,
individuals are able to move from one social class to another up or down during their
lifetime. The Extent of this mobility varies according to the rigidity of social stratification a
given society.
Social Factors:
A consumer’s behavior is also influenced by social factors, such as the consumer’s
reference group, family, and social roles and statuses.
Reference Group: A person’s behavior is strongly influenced by many group .A persons
reference group are those groups that have a direct (face to face) or indirect influence on
the person’s attitudes or behavior. Group having a direct influence on a person are called
membership group. These are group to which the person belongs and interacts. Some are
38
primary groups. With which there is fairly continuous interaction, such as family, friends,
neighbors, and co-workers. Primary group tend to be informal. The person also belong to
secondary group, which tend to be more formal and where there is less continuous
interaction: they include religious organizations, professional associations, and trade
unions.
Family Group:
Members of the buyer’s family can exercise a strong influence on the buyer’s behavior. we
can distinguish between two families in the buyer’s life . The family of orientation consists of
one’s parents. From parents a persons acquires an orientation towards religious, politics,
and economics and a sense of personal ambitions, self –worth, and love. Even if the buyer
no longer interacts very much with his or her parents, the parents influence on the
unconscious behavior of the buyer can be significant. In countries where parents continue
to live with their children, their influence can be substantial.
In case of expensive products and services, husband and wives engage in more joint
decision making. The market needs to determine which member normally has the greater
influence in the purchase of a particular products or services. Either the husband or the
wife, or they have equal influence. The following products and services fall under such:
Husband – dominant: life insurance, automobiles, television
Wife – dominant: washing machines, carpeting, non –living – room furniture, kitchenware
Equal: Living – room furniture, vacation, Housing, outside entertainment.
How to succeed:
Companies like Nokia, Reebok, Coke, PepsiCo and major automobile giants like Toyota,
Suzuki, Ford, Chevrolet, Mercedes etc.. Has made a market for themselves in India. How
did they establish their own individual market in a country like India which is prone to
diverse cultures? Let’s take the example of Ford. Before establishing their base in India,
they engaged in a lot of researches. Their researches were made on the Indian people’s
social life, personal tastes and preferences, way of life, how they identify an effective
product and what makes them get attracted towards a product. The social and economic
conditions were analyzed.
39
The general economy of India was also researched on. They had modified their product to
suit the Indian conditions. Their technology had to be adjusted and suited to such an extent
that their car is adaptable to Indian conditions. Indians are generally prone to be rough and
tough customers and especially taking into account the road conditions and other social
factors they designed the product in such a way that it’s best suited to the conditions and
it’s received by the target customers. Today Ford is enjoying a huge market in India. If an
automobile company from a different country can make wonders why cannot our own
manufacturers adapt to these techniques.
A customer’s want has to be identified and his expectations must be matched with the other
economic and social factors so that their product is receptive. This can be related to any
product. Reebok today is enjoying a huge market in India even though they have hired a
company which is phoenix to manufacture shoes and operate under Reebok. How did they
achieve this? Adapting to social conditions play the most important role in establishing your
brand in the market.
This also means that customers are open to new and different products from time to time.
It’s just that they want the product to be flexible and adaptable to their needs and
preferences. People are changing from time to time, so do their tastes and preferences.
Identifying those is the first step towards achieving success and the rest depends on the
performance of the product.
Internal influences:
Consumer behavior is influenced by: demographics, psychographics (lifestyle), personality,
motivation, knowledge, attitudes, beliefs, and feelings. Consumer behavior concern with
consumer need consumer actions in the direction of satisfing needs leads to his behaviour
behaviour of every individual depend on thinking process
External influences:
Consumer behavior is influenced by: culture, sub-culture, locality, royalty, ethnicity, family,
social class, reference groups, lifestyle, and market mix factors.
40
In 2003, the fresh fruit and vegetables market was valued at £7.6bn at current prices,
having increased by just 3.9% since 1999. Marginal growth in the green vegetables and
potatoes sectors is largely responsible for the limited growth of the market. The fresh fruit
sector accounts for 38.1% of the overall market and is gaining share. This is probably
explained by the continuing trend towards convenience eating as fruit generally requires
little or no preparation, while vegetables usually require preparation and cooking.
Meanwhile, both the fruit and vegetables sectors have benefited from widespread publicity
about the positive impact on health of consuming fruit and vegetables regularly. Indeed, the
scientific evidence that fruit and vegetable consumption can protect against cancer and
other illnesses now appears overwhelming, with studies from around the world highlighting
the benefits of eating even small amounts. In the UK, a government drive to encourage
people to eat more fruit and vegetables may be having a positive effect on the market. The
Department of Health's Five-a-Day Programme, for example, is designed to encourage
consumers to eat five 80 gram portions of fresh fruit and vegetables a day.
Most consumers now buy their fresh vegetables and fruit from the grocery multiples, rather
than specialist fruit and vegetable stores. The multiples tend to display fruit and vegetables
at the entrance to their store in the belief that a display of bright colors presents an
attractive and healthy image of their store to consumers. The supermarkets have also
helped to increase the variety of fruit and vegetables available to the consumer and have
exploited growing demand for convenience products by introducing an ever-growing range
of prepared fruit and vegetables. These include repacked fruit and vegetable mixes, with
the fruit and vegetables peeled and ready to cook. A wide variety of fresh salad mixes is
available. Brands have never had the same impact in the fresh fruit and vegetables sector
as in other areas of the food market. However, the main suppliers say that this is now
changing and the major retailers are increasingly willing to carry brands alongside their own
products.
Its expects fruit consumption to continue to increase over the next few years, as the trends
of growing demand for convenience foods and concerns over health continue to influence
consumers. In addition, the growing presence of brands in the fruit sector should also drive
demand. However, consumption of potatoes and other vegetables is likely to continue its
downward trend. Potatoes are losing out as British people switch from their once staple
food item to more convenient alternatives, such as pasta and rice. Meanwhile, frozen
41
vegetables are likely to continue to win market share at the expense of fresh produce, such
as beans and peas. Some sectors, such as prepared vegetables and salads should
continue to grow rapidly. Intensifying competition among retailers is likely to undermine
value growth with the market expanding by just 3% in value terms between 2004 and 2008.
42
India Retail Industry
India retail industry is the largest industry in India, with an employment of around 8% and
contributing to over 10% of the country's GDP. Retail industry in India is expected to rise
25% yearly being driven by strong income growth, changing lifestyles, and favorable
demographic patterns.
It is expected that by 2016 modern retail industry in India will be worth US$ 175- 200 billion.
India retail industry is one of the fastest growing industries with revenue expected in 2007
to amount US$ 320 billion and is increasing at a rate of 5% yearly. A further increase of 7-
8% is expected in the industry of retail in India by growth in consumerism in urban areas,
rising incomes, and a steep rise in rural consumption. It has further been predicted that the
retailing industry in India will amount to US$ 21.5 billion by 2010 from the current size of
US$ 7.5 billion.
Shopping in India has witnessed a revolution 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 multi- stored malls, huge shopping
centers, and sprawling complexes which offer food, shopping, and entertainment all under
the same roof.
India 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. It is expected that by
2010, India may have 600 new shopping centers.
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.
India retail industry is progressing well and for this to continue retailers as well as the Indian
government will have to make a combined effort.
43
The lifestyle and profile of the Indian consumer is going through a rapid transformation. The
population of India is young, energetic and full of enthusiasm. 50% of the Indian population
is under the age of 25. There has been a transition from price consideration to quality and
design, as the focus of the customer has changed. The upper and middle- class population
of today needs a feel good experience even if they have to spend a little more for that.
People are moving towards luxury and want to experiment with fashion and technology.
There is an increasing need of better apparels, cars, mobile phones and consumer
durables.
The food & grocery, clothing, consumer durables and books & music sectors are the major
retail sectors. However, unorganized small outlets largely control the sector. Hence there is
tremendous potential for the organized sector in various formats, such as hypermarkets,
supermarkets, specialty stores, category killers and discount chains.
44
The Indian retail market, which is the fifth largest retail destination globally, has been
ranked the second most attractive emerging market for investment after Vietnam in the
retail sector by AT Kearney's seventh annual Global Retail Development Index (GRDI), in
2008. The share of retail trade in the country's gross domestic product (GDP) was between
8–10 per cent in 2007. It is currently around 12 per cent, and is likely to reach 22 per cent
by 2010.
A McKinsey report 'The rise of Indian Consumer Market', estimates that the Indian
consumer market is likely to grow four times by 2025. Commercial real estate services
company, CB Richard Ellis' findings state that India's retail market is currently valued at
US$ 511 billion.
Banks, capital goods, engineering, fast moving consumer goods (FMCG), software
services, oil marketing, power, two-wheelers and telecom companies are leading the sales
and profit growth of India Inc in the fourth quarter of 2008-09. India continues to be among
the most attractive countries for global retailers. At US$ 511 billion in 2008, its retail market
is larger than ever and drawing both global and local retailers. Foreign direct investment
(FDI) inflows as on January 2009, in single-brand retail trading, stood at approx. US$ 25.18
million, according to the Department of Industrial Policy and Promotion (DIPP).
India's overall retail sector is expected to rise to US$ 833 billion by 2013 and to US$ 1.3
trillion by 2018, at a compound annual growth rate (CAGR) of 10 per cent. As a democratic
country with high growth rates, consumer spending has risen sharply as the youth
population (more than 33 percent of the country is below the age of 15) has seen a
significant increase in its disposable income. Consumer spending rose an impressive 75
per cent in the past four years alone. Also, organized retail, which accounts for almost 5 per
cent of the market, is expected to grow at a CAGR of 40 per cent from US$ 20 billion in
2007 to US$ 107 billion by 2013.
India has emerged the third most attractive market destination for apparel retailers,
according to a new study by global management consulting firm AT Kearney. It further says
that in India, apparel is the second largest retail category, representing 10 per cent of the
US$ 37 billion retail market. It is expected to grow 12-15 per cent per year. Apparel, along
with food and grocery, will lead the organized retailing in India. India has one of the largest
45
numbers of retail outlets in the world. A report by Images Retail estimates the number of
operational malls to grow more than two-fold, to cross 412, with
205 million square feet by 2010, and a further 715 malls to be added by 2015, with major
retail developments even in tier-II and tier-III cities in India.
Marks & Spencer Reliance India is planning to open 35 more stores over the next
five years, according to Mark Ashman, CEO of the company. The 51:49 joint
ventures between UK’s Marks and Spencer and Reliance Retail Ltd already have 15
stores in India.
Future Group has been restructured to test the new rules on FDI under Press Notes
2, 3 and 4 issued in February 2009. The company plans to bring in up to US$ 148.7
million in foreign investment. Although FDI is permitted only in single-brand retail and
not permitted in multi-brand retail businesses like Future Group's, the conglomerate
has created two layers of operations to take advantage of the three Press Notes that
allow FDI up to 49 per cent in operating-cum-investment companies as long as they
are owned and controlled by Indians.
Carrefour SA, Europe’s largest retailer, may start wholesale operations in India by
2010 and plans to set up its first cash-and-carry outlet in the National Capital Region.
Currently, Carrefour exports goods worth US$ 170 million from India to Europe,
UAE, Indonesia, Europe, Thailand, Singapore and Malaysia.
Jeweler’s manufacturer and retailer, Gitanjali Group and MMTC are jointly setting up
a chain of exclusive retail outlets called Shuddi–Sampurna Vishwas. The joint
venture, which plans to open around 60 stores across India by end of this year, will
retail hallmarked gold and diamond jewelers.
Mahindra Retail, a part of the US$ 6.7-billion Mahindra Group, plans to invest US$
19.8 million by 2010 to step up its specialty retail concept 'Mom and Me'.
46
Policy Initiatives:
100 per cent FDI is allowed in cash-and-carry wholesale formats. Franchisee arrangements
are also permitted in retail trade.
51 per cent FDI is allowed in single-brand retailing.
Growth of Retail Companies in India:
Growth of Retail Companies in India exhibits the boom in the retail industry in India over
the years. The increase in the purchasing power of the Indian middle classes and the influx
of the foreign investments has been encouraging in the Growth of Retail Companies in
India.
Growth of Road Ahead:
According to industry experts, the next phase of growth is expected to come from rural
markets, with rural India accounting for almost half of the domestic retail market, valued
over US$ 300 billion. Rural India is set to witness an economic boom, with per capita
income having grown by 50 per cent over the last 10 years, mainly on account of rising
commodity prices and improved productivity.
According to retail and consumer products division, E&Y India, basic infrastructure,
generation of employment guarantee schemes, better information services and access to
funding are also bringing prosperity to rural households. The rural market, product design
will need to go beyond ideas like smaller sizes (such as single use sachets) to create
genuinely new products, according to Ramesh Srinivas, national industry director
(consumer markets), KPMG India.
According to the Investment commission of India, the overall retail market is expected to
grow from US$ 262 billion to about US$ 1065 billion by 2016, with organized retail at US$
165 billion (approximately 15.5 per cent of total retail sales). India is expected to be among
the top 5 retail markets in the world in 10 years.
47
According to new market research report by RNCOS titled, "Booming Retail Sector in
India", organized retail market in India is expected to reach US$ 50 billion by 2011.
Number of shopping malls is expected to increase at a CAGR of more than 18.9 per
cent from 2007 to 2015.
Rural market is projected to dominate the retail industry landscape in India by 2012
with total market share of above 50 per cent.
Organized retailing of mobile handset and accessories is expected to reach close to
US$ 990 million by 2010.
Driven by the expanding retail market, third party logistic market is forecasted to
reach US$ 20 billion by 2011.
The Indian food market, according to the 'India Food Report 2008' by Research and
Markets is estimated at over US$ 182 billion, and accounts for about two thirds of the total
Indian retail market. Further, according to consultancy firm McKinsey & Co., the retail
food sector in India is likely to grow from around US$ 70 billion in 2008 to US$ 150 billion
by 2025, accounting for a large chunk of the world food industry, which would grow to US$
400 billion from US$ 175 billion by 2025.
The growth of the food industry in India stems from the consistently increasing agricultural
output. With the second largest arable and area in the world, India is one of the key food
producing countries in the world, second only to China.
In fact, the year 2008 has been a record year for India’s food grain sector with increased
production, acreage under cultivation and record procurements.
Further, according to an Economic Times analysis, one out of every five listed companies in
India confirmed higher profits during the first half of fiscal 2008–09, with farm inputs and
farm machinery companies achieving the biggest profits.
According to Mr Subodh Kant Sahai, the Union Minister of State for MFPI, the food
processing industry in India was seeing growth even as the world was facing economic
recession. According to the minister, the industry is presently growing at 14 per cent against
6–7 per cent growth in 2003–04. Foreign direct investments (FDI) totaling US$ 143.80
million was put into the food processing industry in 2007–08 against US$ 5.70 million in the
previous fiscal.
48
Advantage:
India is the largest producer of milk in the world, and is likely to become the second
largest dairy products producer in the coming years.
It is the second largest producer of fruits and vegetables.
It is home to the largest number of livestock in the world.
It is the third largest producer food grains.
It has the third largest output of fish.
With above 9500 spices from medicinal and aromatic plants, India is truly a treasure
trove of spices, accounting for 25-30 per cent of the world’s production. India is the
largest producer consumer and exporter of spices, with major spices produced being
black pepper, cardamom (small & large), ginger, garlic, turmeric, chilli etc.
49
Growth of Retail Companies in India is still not yet in a matured stage with great potentials
within this sector still to be explored. Apart from the retail company like Nilgiri's of
Bangalore, most of the retail companies are sections of other industries that have stepped
in the retail sector for a better business. The Growth of Retail Companies in India is most
pronounced in the metro cities of India; however the smaller towns are also not lagging
behind in this. The retail companies are not only targeting the four metros in India but also
is considering the second graded upcoming cities like Ahmadabad, Baroda, Chandigarh,
Coimbatore, Cochin, Ludhiana, Pune, Trivandrum, Simla, Gurgaon, and others. The South
Indian zone have adopted the process of shopping in the supermarkets for their daily
requirements and this has also been influencing other cities as well where many
hypermarkets are coming up day to day.
Reasons for the fast Growth of Retail Companies in India:
The retail companies are found to be rising in India at a remarkable speed with the years
and these have brought a revolutionary change in the shopping attitude of the Indian
customers. The Growth of Retail Companies in India is facilitated by certain factors like -
existing Indian middle classes with an increased purchasing power
rise of upcoming business sectors like the IT and engineering firms
change in the taste and attitude of the Indians
effect of globalization
heavy influx of FDI in the retail sectors in India
In 2003, the fresh fruit and vegetables market was valued at £7.6bn at current prices,
having increased by just 3.9% since 1999. Marginal growth in the green vegetables and
potatoes sectors is largely responsible for the limited growth of the market. The fresh fruit
sector accounts for 38.1% of the overall market and is gaining share. This is probably
explained by the continuing trend towards convenience eating as fruit generally requires
little or no preparation, while vegetables usually require preparation and cooking.
Meanwhile, both the fruit and vegetables sectors have benefited from widespread publicity
about the positive impact on health of consuming fruit and vegetables regularly. Indeed, the
scientific evidence that fruit and vegetable consumption can protect against cancer and
other illnesses now appears overwhelming, with studies from around the world highlighting
the benefits of eating even small amounts. In the UK, a government drive to encourage
50
people to eat more fruit and vegetables may be having a positive effect on the market. The
Department of Health's Five-a-Day Programmed, for example, is designed to encourage
consumers to eat five 80 gram portions of fresh fruit and vegetables a day.
Most consumers now buy their fresh vegetables and fruit from the grocery multiples, rather
than specialist fruit and vegetable stores. The multiples tend to display fruit and vegetables
at the entrance to their store in the belief that a display of bright colors presents an
attractive and healthy image of their store to consumers. The supermarkets have also
helped to increase the variety of fruit and vegetables available to the consumer and have
exploited growing demand for convenience products by introducing an ever-growing range
of prepared fruit and vegetables. These include repacked fruit and vegetable mixes, with
the fruit and vegetables peeled and ready to cook. A wide variety of fresh salad mixes is
available. Brands have never had the same impact in the fresh fruit and vegetables sector
as in other areas of the food market. However, the main suppliers say that this is now
changing and the major retailers are increasingly willing to carry brands alongside their own
products.
Its expects fruit consumption to continue to increase over the next few years, as the trends
of growing demand for convenience foods and concerns over health continue to influence
consumers. In addition, the growing presence of brands in the fruit sector should also drive
demand. However, consumption of potatoes and other vegetables is likely to continue its
downward trend. Potatoes are losing out as British people switch from their once staple
food item to more convenient alternatives, such as pasta and rice. Meanwhile, frozen
vegetables are likely to continue to win market share at the expense of fresh produce, such
as beans and peas. Some sectors, such as prepared vegetables and salads should
continue to grow rapidly. Intensifying competition among retailers is likely to undermine
value growth with the market expanding by just 3% in value terms between 2004 and 2008.
Protests against retail chains getting into fruits and vegetables:
At least three major cities saw protests in May against Reliance, India's largest corporation,
entering the business of retailing fresh vegetables and fruits through its brand Reliance
51
Fresh. In Ranchi and Indore, the protests had political backing and turned violent. The
protestors, mostly street vendors, fear the company's low prices will destroy their market.
While it is too early to know if their fears are founded in reason or hype, the protests also
stem from the fact that they feel cheated by a government that is in a hurry to promote large
retail businesses and refuses to keep its promises made to small vendors and retailers,
who control about 95 per cent of the country's overall retail business.
India has an estimated 12 million street vendors in its cities—the 2004 National Policy For
Urban Street Vendors pegs it at 10 million—and roughly 2.5 per cent of each city's
population is engaged in vending on streets."About one-fourth of these vendors sell
vegetables and fruits,' says Madhu Kishwar, senior fellow at the Centre for the Studies of
Developing Societies, Delhi. But "there has been little progress on the 2004 policy, which
recognised the value of Services Street vendors provide and the state's duty to protect their
rights', says Kishwar, who was among the people pushing for the policy.
Who is to take the hit?
"We want a level playing field,' says Arbind Singh, coordinator of the National Association of
Street Vendors of India in Patna."There is no government recognition, credit availability or
institutional support for street vendors. They have to wage daily battles with the police,
municipal authorities and local goons, and bribe them on a weekly basis,' Singh says. "See
this against the single-window clearance for the industry, and you'll realise our grievance.
Like industries, we too generate employment and offer services. Why should we be
discriminated against?' asks Basant Haryana, leader of a street vendors' union in Jaipur.
"Our protest was peaceful. It wasn't led by narrow political interests. Rather it came from
those fearing loss of livelihood,' says fellow union leader Ghanshyam Kotwal. "The Ranchi
protest turned violent due to goons infiltrating our rally,' says Kaushal Kishore of the
Jharkhand Educated Unemployed Footpath Vendors' Association."We have very little, and
that too we will lose to competition that has unfair government support.'
Singh says the retail chains' low prices are because of their ability to take losses over years
—leading losses—to out-price competitors. "Once the small players are gone.
52
Retail rush:
Many visible corporate brands are into the retail business: Reliance, ITC, Bharti, Big
Bazaar, Godrej and Subhiksha. India has not allowed FDI in multi-brand retailing. But
international behemoths like Wal-Mart, which has a deal with Bharti, are raring for joint
ventures. (Wal-Mart is world's largest retailer and the second largest corporation. Labour
unions, women's rights groups, and grassroots organisations have long argued that the
reason for Wal-Mart's cheap prices is how shoddily it treats its employees. Wal-Mart had to
leave Germany and South Korea because it did not get the kind of room for its policies as in
the US and other countries.)
Fresh fruits and vegetables (FFV) are a small part of this retail juggernaut. "Even if retail
chains do very well, they will capture only 10 per cent of the FFV market in another five to
10 years,' says P Chengappa, professor of agricultural marketing at the University of
Agricultural Sciences, Bangalore."Retail chains do well in non-perishable items but fail to
capture the market of perishables. Besides, the Indian market is too large, with too many
commodities and far too many small players. Bangalore alone consumes about 10,000
tonnes of FFV every day. Nobody would have the money to come up with cold storage
chains and backward integration of the supply chain to control such a market.'
This doesn't mean there is no money to be made in the retail of perishables. "In India,
organised retail of perishables may be small, but some successful players have been
around for long: Mother Dairy and Safal are two significant brands. Both are cooperatives
and haven't affected vendors in any way,' says Ashok Gulati, chairperson of the south Asia
office of the International Food Policy Research Institute. The institute is due to come out
with a study on FFV retails led by Thomas Reardon, a known authority on retail business in
developing countries. Gulati, a supporter of the retail revolution, says farmers will benefit by
way of a better price.
All for farmers:
Better price for farmers is the high point of the policy sales pitch of everybody, from the
government to retail chains like Reliance Fresh. Sources close to Reliance say the
53
company will not get into any controversial deal like contract farming. Instead, it has an
ambitious marketing network for purchase and storage with direct contact with farmers. The
company has issued a gag order to its employees as the operations are in pilot stage. But
sources say organised retailers can offer prices lower than the market because of
economies of scale, and because they "eliminate the middleman' and bring more efficiency
by cutting down wastage losses, around 30 per cent now. Wastage loss will reduce, they
say, when the same company handles the produce from the farm to the fork, as against
now, when farm produce goes through several levels of wholesale and tertiary traders
before reaching the retailer. Losses further reduce with investments in cold-storage.
Metha Ram Kriplani, member of the Agricultural Produce Market Committee of Delhi's
Azadpur, India's largest market for FFV, refutes this: "In the existing supply chains of FFV,
all the business is on credit among traders, and payment gets stuck in case of bad handling
and wastages. Traders also invest in cold storages. What rocket science will these retail
chains bring?'
S Sivakumar, chief executive of ITC's agribusiness e-choupal Fresh in Hyderabad says,
"Given the peculiarities of the Indian market, retail of FFV has to be different. Their annual
reports should reflect not only financial results but also social and environmental
allegiance.' ITC is planning to organise street vendors and give them recognition, along with
pushcarts and uniform. There is "a case for regulation of the market to protect interests of
consumers, farmers and competitors', says Sivakumar. Reliance, tired of the bad press it
gets, also talks about having a regulatory body to settle all disputes.
Regulation:
"Unlike non-perishables like food grains, there is no mechanism to regulate the market of
perishables in India except the Essential Commodities Act, 1955,' says Chengappa. Retail
of FFV involves at least three ministries: agriculture, commerce, and consumer affairs, but
none has formally discussed the possibility of a regulatory body to check unfair and
monopolistic practices, or monitor prices paid to farmers. Sources in the Union ministry of
consumer affairs say they have held informal discussions on the issue. The Communist
Party of India (Marxist), a supporter of the UPA government at the centre, has recently
asked for a regulatory body for the organised retail industry.
54
Sukhpal Singh, professor of agricultural marketing at the Indian Institute of Management,
Ahmedabad, advises caution in opening up retail to big players. Devender Sharma, a food
policy analyst in Delhi, says: "The market loves consumers and hates farmers. US farmers
earn less than they did in the past, and will not survive without subsidies. In Europe, the
largest provider of farm subsidies, a farmer quits agriculture every minute. These are
farmers with access to several markets. Markets don't eliminate middlemen—they
consolidate into large retail chains. What chance do our poor farmers with no direct
subsidies have in this market?'
UP-AND-COMING FOOD RETAIL FORMATS:
With the changing food consumption patterns, consumers need for convenience, choice
and value for money the set-up of retail format is changing. The Indian consumers do visit
about eight to ten outlets to purchase various food products, which make up the daily
consumption basket. These outlets include neighborhood kirana stores, bakeries, fruit and
vegetable outlets, dairy booths and chakkies (small flour mills), which is very time-
consuming and unproductive way of shopping for food. With changing lifestyle there is
growing scarcity of time, and convenience in food shopping is emerging as an important
driver of growth of one-stop retail formats that can offer consumer 'value for time' in addition
to 'value for money'. These are giving an opportunity to various other retail formats:
A. Neighborhood Stores
In India about 90% of food purchases are made within a distance of 1.5 km from the
customer's home. This means that an organized retailer would need to have a
'neighborhood store' close to customers in order to capture the share of wallet that is spent
on food. These stores would cater to the consumer's daily and weekly needs. The outlets
closest to a neighborhood store in India are 'Safal' outlets operated by Mother Dairy in
Delhi, Margin Free in Kerala and Subhiksha.
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B. Supermarkets
This format caters to the consumers' need for choice and variety. These needs translate
into 'more width' and 'more depth' in each category. These stores cater to the consumers in
a catchments area with a radius of 3 to 4 km and therefore need to be destination stores. A
supermarket can cater to the consumers' weekly, monthly and occasional needs. Examples
of supermarkets already in India are Food World, Trinetra and Nilgiri's.
C. Hypermarkets:
Hypermarkets are essentially destination stores catering to the consumers' bulk shopping
needs in both food and non-food categories. The key added values for the customer are
'choice' and 'value for money' because products are sold at a discounted price. The
hypermarkets model of food retailing is new to India. Spencers (RPG), Big Bazaar
(Pantaloons), Star India Bazaar.
D. Cash & Carry (C & C) Stores:
These stores sell their products to their members only. The members are typically retailers
and institutions. The key added value is a wide range of products under one roof, available
at wholesale prices. Metro has started the first C & C store in India in Bangalore. The
typical area of a C & C store is 70,000 to 100,000 sq. ft. and both food and non-food
products are stocked.
Format Description The Value Proposition
56
Branded Stores Exclusive showrooms either owned
or franchised out by a
manufacturer.
Complete range available for a given
brand, certified product quality
Specialty Stores Focus on a specific consumer
need, carry most of the brands
available
Greater choice to the consumer,
comparison between brands is
possible
Department Stores Large stores having a wide variety
of products, organized into different
departments such as clothing,
house wares, furniture, appliances,
toys, etc.
One stop shop catering to varied/
consumer needs.
Supermarkets Extremely large self-service 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 economies of
scale
Low Prices
Hyper- mart Larger than a supermarket,
sometimes with a warehouse
appearance, generally located in
quieter parts of the city
Low prices, vast choice available
including services such as
cafeterias.
Convenience stores Small self-service formats located
in crowded urban areas.
Convenient location and extended
operating hours.
Shopping Malls An enclosure having different
formats of in-store retailers, all
under one roof.
Variety of shops available to each
other.
57
KEY DEVELOPMENTS IN FOOD RETAIL:
The major development in food retail is consideration of Foreign Direct Investment (FDI)
with a limitation that all companies would have to meet mandated export obligations. Food
processing minister Subodh Kant Sahay told ET that “We are considering a proposal to
allow FDI in food retail. It should be in such a way that it would boost our agriculture. Our
farmers must also get benefits of economic liberalization”.
The government is also considering the opening up of the $330-billion retail market with
adequate provisions to protect neighborhood stores.
In every retail format food trade is growing. More and more corporate houses such as HLL,
ITC, Godrej and Reliance are already working into food retail. Huge increase is expected
from the corporate players, which will help grow the entire food retail sector. Dabur’s Amit
Burman has also forayed into food retailing. According to Amit "Food and beverages
retailing is a very attractive segment and with Lite Bite Concepts we are targeting Rs 1,000
crore sales in a couple of years with around 200 outlets," Well-established players such as
Subhiksha, Food Bazaar and Spencer's Daily are also tapping into backward linkages,
while trying to match their expanding geographies with retail formats. Also, most food retail
players have been region-specific as far as geographical presence is concerned. Take the
RPG Group's FoodWorld, Nilgiris, Margin Free, Giant, Varkey's, all of which are more or
less spread in the Southern region; Sabka Bazaar, Big Apple has a presence only in and
around Delhi; names such as Haiko and Radhakrishna Foodland are Mumbai-centric; while
Adani is Ahmedabad-centric.
Retailers' entrance in the unbranded food space:
Modern food formats like Food Bazaar and Spencer's have their eye on the unbranded part
of the consumer's shopping basket. This constitutes as much as 60% of the total purchases
and growing sharply, says AC Nielsen estimates. Retailers are offering a package of
convenience and freshness, and have an edge over manufacturers that focus mainly on
packaged conveniences.
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Food retailers are offering 'live kitchen' formats, which offer on-the-spot home-style gravies,
dal, cooked rice and kneaded dough with options like grinding coffee fresh at store, idli
batter, paneer, curd and cut vegetables.
FOOD RETAIL AND ITS STEPPING STONES:
The opportunities in food retail sector are as follows:
Rising Investment:
There are strong opportunities in food retail as a result of encouraging changes in
consumer purchasing patterns, the availability of real estate and supply chain development.
Organized food retail presents a unique investment opportunity for corporate looking to
diversify. A good understanding of consumer, access to the right locations and the ability to
manage the supply chain efficiently will be critical success factors for the new entrant.
FDI Policy for Retail:
Gates have been opened up for single brand retailers. In February 2006, the door was
opened to some extent when the government allowed 51% FDI by single brand companies
subject to government approvals.
Emergence of Logistic Providers:
The present lack of logistic support exposes the need for an integrated logistic provider. As
retail activity gathers momentum and large quantities of perishables are sold in modern
formats, the logistic service providers would have a crucial role to play in bridging the
supply gap. Retail players would also benefit from an efficient supply chain inventory
management.
The past 4-5 years have seen increasing activity in food retailing. Various business houses
have already planned for few investments in the coming 2-3 years. Though the retailers will
have to face increasingly demanding customers and intensely competitive rivals, more
investments will keep flowing in and the share of organized food sector will grow rapidly.
59
Organized food retailing in India is surely poised for a takeoff and will provide many
opportunities both to existing players as well as new entrants.
Retailing consists of the sale of goods or merchandise from a fixed location, such as a
department store, boutique or kiosk, or by post, in small or individual lots for direct
consumption by the purchaser. Retailing may include subordinated services, such as
delivery. Purchasers may be individuals or businesses. In commerce, a "retailer" buys
goods or products in large quantities from manufacturers or importers, either directly or
through a wholesaler, and then sells smaller quantities to the end-user. Retail
establishments are often called shops or stores. Retailers are at the end of the supply
chain. Manufacturing marketers see the process of retailing as a necessary part of their
overall distribution strategy. The term "retailer" is also applied where a service provider
services the needs of a large number of individuals, such as a public utility, like electric
power.
Shops may be on residential streets, shopping streets with few or no houses or in a
shopping mall. Shopping streets may be for pedestrians only. Sometimes a shopping street
has a partial or full roof to protect customers from precipitation. Online retailing, a type of
electronic commerce used for business-to-consumer (B2C) transactions and mail order, are
forms of non-shop retailing.
Shopping generally refers to the act of buying products. Sometimes this is done to obtain
necessities such as food and clothing; sometimes it is done as a recreational activity.
Recreational shopping often involves window shopping (just looking, not buying) and
browsing and does not always result in a purchase.
.Retail comes from the French word retaillier, which refers to "cutting off, clip and divide" in
terms of tailoring (1365). It first was recorded as a noun with the meaning of a "sale in small
quantities" in 1433 (French). Its literal meaning for retail was to "cut off, shred, paring".[2]
Like the French, the word retail in both Dutch and German (detail Handel and Einzelhandel
respectively), also refers to the sale of small quantities of items.
Retail pricing:
The pricing technique used by most retailers is cost-plus pricing. This involves adding a
markup amount (or percentage) to the retailer's cost. Another common technique is
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suggested retail pricing. This simply involves charging the amount suggested by the
manufacturer and usually printed on the product by the manufacturer.
In Western countries, retail prices are often called psychological prices or odd prices. Often
prices are fixed and displayed on signs or labels. Alternatively, when prices are not clearly
displayed, there can be price discrimination, where the sale price is dependent upon which
the customer is. For example, a customer may have to pay more if the seller determines
that he or she is willing and/or able to. Another example would be the practice of
discounting for youths or students.
Transfer mechanism:
There are several ways in which consumers can receive goods from a retailer:
Counter service, where goods are out of reach of buyers and must be obtained from
the seller. This type of retail is common for small expensive items (e.g. jewelry) and
controlled items like medicine and liquor. It was common before the 1900s in the
United States and is more common in certain countries.
Delivery (commerce), where goods are shipped directly to consumer's homes or
workplaces. Mail order from a printed catalog was invented in 1744 and was
common in the late 1800s and early 1900s. Ordering by telephone is now common,
either from a catalog, newspaper, television advertisement or a local restaurant
menu, for immediate service (especially for pizza delivery). Direct marketing,
including telemarketing and television shopping channels, are also used to generate
telephone orders. Online shopping started gaining significant market share in
developed countries in the 2000s.
Door-to-door sales, where the salesperson sometimes travels with the goods for
sale.
Self-service, where goods may be handled and examined prior to purchase, has
become more common since the 1920s.
Building types:
A market is a physical location where buyers and sellers converge. Usually this is done in
town squares, sidewalks or designated streets and may involve the construction of
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temporary structures (market stalls). Markets are contrasted with shop or store trading,
where a retailer has a permanent, dedicated building.
Buildings for retail have changed considerably over time. Market halls were constructed in
the middle Ages, which were essentially just covered marketplaces. The first shops in the
modern sense used to deal with just one type of article and usually adjoined the producer
(baker, tailor, and cobbler). In the U.S., retailers often provided boardwalks in front of their
stores to protect customers from the mud. In France in the 19th century, arcades were
invented, which were streets of several different shops, roofed over. Counters, each dealing
with a different kind of article, were invented; it was called a department store. One of the
novelties of the department store was the introduction of fixed prices, making haggling
unnecessary and browsing more enjoyable.] This is commonly considered the birth of
consumerism. In cities, these were multi-story buildings which pioneered the escalator.
In the 1920s, the first supermarket opened in the United States, heralding in a new era of
retail: self-service. Around the same time, the first shopping mall was constructed, which
incorporated elements from both the arcade and the department store. A mall consists of
several department stores linked by arcades, many of whose shops are owned by the same
firm under different names. The design was perfected by the Austrian architect Victor
Gruen. All the stores rent their space from the mall owner. By mid-century, most of these
were being developed as single enclosed, climate-controlled, projects in suburban areas.
The mall has had a considerable impact on the retail structure and urban development in
the United States.
In addition to the enclosed malls, there are also strip malls, which are "outside" malls (in
Britain they are called retail parks). These are often composed of one or more big-box
stores or superstores.
Physical shops are known as brick and mortar stores in the United States, when contrasting
them with online stores. Many shops are part of a chain; a number of similar shops with the
same name, selling the same products in different locations. The shops may be owned by
one company or there may be a franchising company that has franchising agreements with
the shop owners. Sometimes online retailing replicates existing retail types, such as the
online shops or virtual marketplaces used by Amazon.com.
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Second hand retail:
Some shops sell second-hand goods. In the case of a nonprofit shop, the public donates
goods to the shop to be sold. In give-away shops goods can be taken for free.
Another form is the pawnshop, in which goods are sold that were used as collatoral for
loans. There are also "consignment" shops, which are where a person can place an item in
a store and if it sells, the person gives the shop owner a percentage of the sale price. The
advantage of selling an item this way is that the established shop gives the item exposure
to more potential buyers.
Discount stores:
Discount stores offer a wide range of products, although they mainly offer value goods,
such as housewares, clothes, kitchen-wares, gifts and healthcare products. These are sold
at reduced prices, because many of them are either brand name or clearance products.
Sales techniques:
Behind the scenes at retail, there is another factor at work. Corporations and independent
store owners alike are always trying to get the edge on their competitors. One way to do
this is to hire a merchandising solutions company to design custom store displays that will
attract more customers in a certain demographic. The nation's largest retailers spend
millions every year on in-store marketing programs that correspond to seasonal and
promotional changes. As products change, so will a retail landscape. Retailers may also
use facing techniques to create the look of a perfectly-stocked store, even when it is not.
A destination store is one that customers will initiate a trip specifically to visit, sometimes
over a large area. These stores are often used to "anchor" a shopping mall or plaza,
generating foot traffic, which is capitalized upon by smaller retailers.
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Customer service:
According to the book "Discovery-Based Retail",[8] customer service is the "sum of acts and
elements that allow consumers to receive what they need or desire from your retail
establishment."
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Relationship between farmers and retail industry
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Reliance opens a ‘fresh’ chapter in retail
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Reliance Fresh is the convenience store format which forms part of the retail business of of
Reliance Industries of India which is headed by Mukesh Ambani. Reliance plans to invest in
excess of Rs 25000 crores in the next 4 years in their retail division. The company already
has in excess of 560 reliance fresh outlets across the country. These stores sell fresh fruits
and vegetables, staples, groceries, fresh juice bars and dairy products.
A typical Reliance Fresh store is approximately 3000-4000 square. feet and caters to a
catchment area of 1-2 km.
Reliance Retail
Type Supermarket
Founded 30 October 2006
Headquarters Mumbai, India
Key people Mukesh Ambani, CEO
Industry Retail
Website www.ril.com
History:
Post launch, in a dramatic shift in its positioning and mainly due to the circumstances
prevaling in UP, West Bengal and Orissa, it was mentioned recently in news Dailies that,
Reliance Retail is moving out of stocking fruits and vegetables. Reliance Retail has decided
to minimise its exposure in the fruit and vegetable business and position Reliance Fresh as
a pure play super market focusing on categories like food, FMCG, home, consumer
durables, IT and wellness, with food accounting for the bulk of the business.
The company may not stock fruit and vegetables in some states. Though Reliance Fresh is
not exiting the fruit and vegetable business altogether, it has decided not to compete with
local vendors partly due to political reasons, and partly due to its inability to create a robust
supply chain. This is quite different from what the firm had originally planned.
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When the first Reliance Fresh store opened in Hyderabad last October, not only did the
company said the store’s main focus would be fresh produce like fruits and vegetables at a
much lower price, but also spoke at length about its “farm-to-fork’’ theory. The idea the
company spoke about was to source from farmers and sell directly to the consumer
removing middlemen out of the way.
Reliance Fresh, Reliance Mart, Reliance Digital, Reliance Trendz, Reliance Footprint,
Reliance Wellness, Reliance Jewels, Reliance Timeout and Reliance Super are various
formats that Reliance has rolled out.
In addition, Reliance Retail has entered into an alliance with Apple for setting up a chain of
Apple Specialty Stores branded as iStore, starting with Bangalore.
Growth through Value Creation:
With a vision to generate inclusive growth and prosperity for farmers, vendor partners, small
shopkeepers and consumers, Reliance Retail Limited (RRL), a subsidiary of RIL, was set
up to lead Reliance Group’s foray into organized retail.
With a 27% share of world GDP, retail is a significant contributor to overall economic
activity across the world. Of this, organized retailing contributes between 20% to 55% in
various developing markets. The Indian retail industry is pegged at $ 300 billion and
growing at over 13% per year. Of this, presently, organized retailing is about 5%. This is
expected to grow to 10% by 2011. RRL has embarked upon an implementation plan to
build state-of-the-art retail infrastructure in India, which includes a multi-format store
strategy of opening neighborhood convenience stores, hypermarkets, and specialty and
wholesale stores across India.
RRL launched its first store in November 2006 through its convenience store format
‘Reliance Fresh’. Since then RRL has rapidly grown to operate 590 stores across 13 states
at the end of FY 2007-08. RRL launched its first ‘Reliance Digital’ store in April 2007 and its
first and India’s largest hypermarket ‘Reliance Mart’ in Ahmadabad in August 2007. This
year, RRL has also launched its first few specialty stores for apparel (Reliance Trends),
footwear (Reliance Footprints), jeweler (Reliance Jewels), books, music and other lifestyle
products (Reliance Timeout), auto accessories and service format (Reliance AutoZone) and
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also an initiative in the health and wellness business through ‘Reliance Wellness’. In each
of these store formats, RRL is offering a unique set of products and services at a value
price point that has not been available so far to the Indian consumer. Overall, RRL is well
positioned to rapidly expand its existing network of 590 stores which operate in 57 cities.
During the year, RRL also focused on building strong relationships in the agri-business
value chain and has commenced marketing fruits, vegetables and staples that the company
sources directly to wholesalers and institutional customers. RRL provides its customers with
high quality produce that has better shelf life and more consistent quality than was available
earlier. RRL has made significant progress in establishing state-of-the-art staples
processing centres and expects to make them operational by May 2008.
Through the year, RRL also expanded its supply chain infrastructure. The Company is fully
geared to meet the requirements of its rapidly growing store network in an efficient manner.
Recognizing that strategic alliances are going to be a key driver to its retail business, in FY
2007-08, RRL established key joint ventures with international partners in apparel, optical
and office products businesses. Further, RRL will continue to seek synergistic opportunities
with other international players as well. This year, RRL will continue its focus on rapid
expansion of the existing and other new formats across India.
Reliance Industries on Sunday launched its first retail format called Reliance Fresh in
Hyderabad. Spread over 2,000-5,000 sq ft, 11 such Reliance Fresh neighborhood
convenience stores will come up in the city beginning November 3.
These stores will sell fresh fruit and vegetables besides staples (dal, atta, rice) as well the
company’s in-house brand, Reliance Select.
RIL is targeting not only the households but also street side vegetable sellers. According to
sources, RIL is setting up Ranger Farms — outlets that will specifically service street side
vegetable sellers who can stock up on fresh farm produce.
The Ranger outlets will open at 2 a.m. and continue selling produce to vendors till 9 a.m.
The Ranger format is something in the lines of German major Metro Cash & Carry’s
operations in India. But while Metro targets larger retailers such as restaurant chains and 70
bulk consumers, RIL is expected to forge a relationship with street side vegetable sellers
through the Ranger concept. It is not yet clear whether separate outlets will be opened for
Ranger Farm or the existing Fresh outlets will function as Farms by the night.
Guninder Kapoor, president and CEO of Food Business at RIL, says the Fresh stores at
Hyderabad are part of a pilot project. “This is a pilot project which will help us understand
customer needs. The pilot for this format will be taken too many other cities over the next
few months.”
Next on the company’s list are bigger cities, including Delhi and Mumbai.
RIL has already said that it will invest close to Rs 25,000 crore over the next five years in
the retail business. The company plans to establish 4,000 retail outlets across various
formats by then, and is eyeing sales of Rs 1,00,000 crore over the five-year period from the
retail business.
Besides Reliance Fresh, the company also plans to launch larger format stores called “Feel
Fresh Plus” which will be spread over 10,000-15,000 sq ft. The Fresh Plus stores will stock
fruit and vegetables as well as apparel, consumer electronics, FMCG items and even
medicines.
From Hyderabad, these stores will travel to Mumbai and Delhi where Reliance has
identified up to 80 locations each.
But even as the retail debut kicks off with fruit and vegetables, it seems the company is
doing a rethink on whether to get into the larger formats such as hypermarkets.
11 Reliance Fresh neighborhood convenience stores will be launched first in Hyderabad
These stores will be set up soon in Mumbai and Delhi where Reliance has identified up to
80 locations each
RIL is also setting up Ranger Farms — outlets that will specifically service vegetable
vendors
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Ranger outlets will open at 2 a.m. and continue selling produce to vendors till 9 a.m.
Company plans to establish 4,000 retail outlets across various formats in the country
Reliance Industries chairman Mukesh Ambani’s deal-making spree to get the best domain
expertise in the retail sector is poised for the big one now. Reliance Retail (RRL), is locked
in ‘substantial’ discussions to float an equal joint venture with iconic UK fashion retailer
Marks & Spencer (M&S) for apparel, gourmet food and cafes, multiple sources familiar with
the situation said.
The deal, slated to be clinched in the next three weeks, would see the UK retailer bringing
in new formats like food and cafes into India. M&S’ core business — apparel and lingerie —
is already operational in the country.
According to a source close to the deal, the gourmet food format is likely to be integrated
with Reliance Fresh “wherever possible,” (up market localities) as a shop-in-shop format.
This would help M&S get immediate scale in food business. There are 491 Reliance Fresh
stores that sell food, FMCG and fruits and vegetables and this figure is likely to touch 1,400
by the end of next fiscal.
“The implications of this particular JV are much deeper. It’s much more holistic in nature
and therefore taking long to seal,” the source added.
The $16-billion M&S, operating in the country through a franchisee arrangement with Planet
Retail since 2001, is in the midst of charting a new India strategy aimed at accelerating
expansion in the domestic market. It recently slashed prices by 20% to attract more footfalls
in the stores and taking prime space in malls to open more stores.
Reliance Retail, the 100% subsidiary of Reliance Industries, on October 28 unveiled
Reliance Fresh, the first of its multi-format retail foray involving an investment of Rs 25,000
crore.
Reliance Fresh is the company’s brand for neighborhood fresh-food outlets. It will also sell
kitchen equipment and other edibles.
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Besides, it has planned hypermarkets, supermarkets, discount stores, department stores,
convenience stores and specialty stores, to be unveiled shortly.
The next stop for Reliance Retail will be Ahmedabad, where the company will launch an
outlet on December 28, and the birthday of RIL founder Dhirubai Albania.
After that, it will move to West Bengal and Punjab, followed by simultaneous launches in
Delhi and Mumbai.
“These stores, ranging from 2,000 to 5,000 sq feet, will provide customers with a variety of
fresh fruits, vegetables, staple foods and other products in a world-class ambience,” said
Gunender Kapur, president, foods business, at the unveiling ceremony.
The strategy is to open one Reliance Fresh store in a radius of three to four km to serve
1,000-2,000 families. This means about 30-40 stores in the major metros. The air-
conditioned stores recorded a combined sale of Rs 22 lakh on the inaugural day itself.
Reliance Fresh is selling vegetables and fruits sourced from farmers through the company’s agri
hubs.
Controversy :
Recently their stores in Jharkand faced the ire of mobs comprising of local vegetable
vendors. They vandalised and attacked the stores claiming that they were stealing their
livelihoods.
In August 2007, Uttar Pradesh Chief Minister Mayawati ordered to close 10 new stores
keeping view of Law & order situation. In November 2007, Reliance Fresh stores are
attacked by Bharatiya Janshakti Party supporters headed by Uma Bharti.
‘Suicide’ squad against Reliance Fresh outlets'
Bhubaneswar: Traders and roadside vendors opposing the opening of Reliance Fresh
outlets in Orissa on Saturday formed a “suicide” squad.
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“As many as 100 youth today joined the squad as they prefer to die while fighting rather
than facing starvation,” All-Orissa Roadside Vendors and Small Shop Owners Association
president Pratap Sahu said.
Reliance at jaipur
Reliance open its `Reliance Fresh` retail stores in Jaipur from tomorrow, after opening its
maiden store in Hyderabad last month, report agency sources.
Jaipur has been chosen as the next destination for opening of these farm fresh stores after
its launch in Hyderabad, mainly because the infrastructure required to start the stores have
been put in place quickly and efficiently in Rajasthan.
Reliance will open five stores in Jaipur this week, which will stock 125 varieties of fruits and
vegetables at a time.
All seasonal fruits and vegetables will be available including puja flowers.
The company said that 30% of fruits and vegetables for the stores in Rajasthan will be
sourced from within the state, especially from Alwar, while the rest would be obtained from
all over the country.
President and chief executive (food business), Gunendar Kapur, said the retail scene in
India is totally fragmented and Reliance Retail is to be the most organized and admired
retail company in India.
He said that the complete farm-to-fork project cycle initiated by the RIL is part of its
agricultural initiative and is unlikely to harm the small-time vegetable vendor.
RIL feels India’s retail growth, which is now worth USD 300 billion, could grow up to USD
427 billion in the next four years.
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Aditya Birla wants more
Aditya Birla Retail Limited re-brands its Fabmall grocery supermarkets to more. A name
reflective of its commitment to offering consumers a more fulfilling retail experience. The re-
branding follows the acquisition of the Trinethra Super Retail that includes the retail brands
Fabmall, Trinethra and FabCity by Aditya Birla Retail in January 2007. As a result of the
integration process, 68 Fabmall stores in Karnataka will be re-branded under the umbrella
of more. the retail brand from the Aditya Birla Group.
With the underlying objective to enhance the shopping experience for consumers, the new
stores will continue to be built around the proposition of quality, affordability and
convenience with new in-store merchandise and a whole new retail experience. The more.
Stores will offer a wide range of product categories including fruits and vegetables, staples,
personal care, home care, household general merchandise and dairy products.
Speaking on the occasion, Mr. Sumant Sinha, CEO, Aditya Birla Retail Limited said, "The
retail market in India is reaching a point of saturation. With the endeavour to improve the
shopping experience for our consumers, we promise more satisfaction for every consumer
at our store. We are happy to unveil our new retail brand and will continue to offer more
value to customers. This is an exciting period for the Indian grocery retail industry and we
are delighted to participate in the growth of the market."
The acquisition of Trinethra Super Retail has provided Aditya Birla Retail with a strong retail
footprint in South India extending to 275 stores and over more than half a million square
feet in Andhra Pradesh, Karnataka, Tamil Nadu and Kerala, where it is the leading food and
grocery retailer. Currently Aditya Birla Retail has 60 stores in Bangalore, eight stores in
Mysore and 10 stores in Mangalore.
All Fabmall stores will be re-branded to more. By January end.
Mr. Sinha added that Aditya Birla Retail's vision is to be among the leading retail players in
India. With the launch of more. Neighborhood supermarkets, destination hypermarkets
which will address monthly and event-based shopping needs will soon follow. The Group
already has stores in other parts of India and envisions having a pan India presence
covering tier 1 and tier 2 markets in the not-so-distant future.
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The more. Stores have been developed after in-depth research to understand the needs
and expectations of the Indian consumers. More. Is the answer to the shopping needs of
the Indian housewife who wants a modern and convenient retail destination in her
neighborhood, with an attractive and a consistent range of products. More. Assures
consumers the best quality products at the best market price.
More. Also has its own label across value, premium and select ranges. The products follow
stringent quality norms and are available in attractive packaging. To ensure the freshest
supply of fruits and vegetables to consumers, Aditya Birla Retail is building direct linkages
with farmers. It is also investing in back-end infrastructure to develop a robust supply chain
connecting households more directly with farmers.
The more. Chain of supermarkets is spread over convenient locations and with layouts that
allow ease of navigation. The project display is well-organized and facilitates ease of
choice. The stores have been designed by Fitch, the leading international retail design firm.
Demographic movements in India over the last two decades have made organised retail a
necessity. The rapid growth of this industry is confirmation that the idea of orgranised
retailing has taken root in India. The industry is today valued at around US$ 320 billion.
Within the organized retail sector, food and groceries account for around 14 per cent of the
total market with potential to garner an even bigger share of the market.
About Aditya Birla Retail Ltd.Aditya Birla Retail Ltd is the retail arm of the Aditya Birla Group, a US$ 24 billion
corporation with a market capital of US$ 31.5 billion and in the league of Fortune 500
companies. In May 2007, Aditya Birla Retail Ltd launched its first store, more. In Pune and
currently has 100 stores across the country. With the acquisition of Trinethra Super Retail,
the company will increase its retail foothold to 300 plus stores with re-branding of Trinethra
and Fabmall stores in South India
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Our mission is to change the way people shop. We will give them more.”Says Mr. Kumar
Mangalam Birla, Chairman, Aditya Birla Group.
This statement clearly articulates what Indian consumers can expect of the more. Chain of
stores from Aditya Birla Retail Limited.
The more. Brand of stores has been currently launched through the supermarket format,
more.
So what will more? For you deliver to its shoppers?
The more. For you advantage: more. Promises a world-class pleasurable shopping
experience to Indian consumers in their very own neighborhoods. More. Quality, more.
variety, more. Convenience and more. Value are the four delivery cornerstones of the more.
Chain of supermarket stores.
Quality:every product at more. Goes through a thorough quality check process ensuring 100 per
cent more. Satisfaction.
Variety:Apart from a large range of national brands, shoppers will also find a section called the Best
of India, which is an assortment of unique products sourced from across India.
The wide range of fresh fruits and vegetables along with private label offerings under brand
names Value, Select and Premium ensure that more. variety is a promise delivered across
the store.
Convenience:Convenient locations within easy reach of consumers and a neat, cheerful and friendly
layout, enough isle space, signage that speaks the consumer's language aiding in
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identifying what she has come to shop for easily, all go a long way in ensuring more.
Value:more. Promises best in market pricing. Linking up directly with farmers to source fresh
fruits, vegetables and staples ensure great quality as well as great price. Add to this, the
membership program Club more. Which provides convenience, customized shopping
solutions and savings, and the more? Value promise becomes all the more evident.
Brand was successfully launched to representatives of media at a press conference chaired
by the Chairman, Mr. Kumar Mangalam Birla, at the Trident-Hilton rooftop in Mumbai.
Subsequently, the first supermarket was launched in Pune on 31 May 2007 to a
phenomenal response from consumer’s right from day one. With glowing and positive
feedback from consumers, more. Stores are all set to take the market by storm.
Chain of stores is being launched across the country with an aggressive roll-out plan,
starting with Pune. By March 2008, more. Will be in place across various cities in India. For.
Experience:
Aditya Birla Nuvo, a part of the Aditya Birla group, plans to rejig its apparel business by
opening 150 new stores at city centres, where footfall is higher, after closing 30 unviable
stores, a top company official has said.
The company’s move comes after its net loss widened to Rs 141.2 crore in the March-
ended quarter, owing to mounting losses in apparels. The loss was Rs 82.2 crore in the
apparel business, against a loss of Rs 4.44 crore in the corresponding quarter of the
previous financial year. Revenue from sale of garments fell 1 per cent to Rs 273.3 crore
during the period, when consumers responded to the financial downturn by tightening their
purse strings.
“In the current quarter, we plan to close 30 stores where sales per square feet have
dropped significantly. We expect to save Rs 10 crore annually with the closure of these
unprofitable stores,” said Pranab Barua, whole-time director of Aditya Birla Nuvo and chief
executive of the textile and apparel business, Aditya Birla Group.
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The apparel business arm of the company, which has Madura Garments Lifestyle & Retail
and Peter England Fashions & Retail, runs 340 stores in the country. Madura Garments
has brands such as Louis Phillippe, Van Heusen and Allen Solly and a tie-up with fashion
brand Esprit.
The company is also taking other cost cutting measures in apparels which are expected to
save it Rs 100 crore in fiscal year 2010, he says. “We will align all growing businesses and
close the loss-making stores. Moreover, we have a plan to reduce the store area in some
cases,” he added.
The company also plans to revive the Allen Solely brand to boost revenues and improve
visibility. “Van Heusen, Louise Phillippe and Peter England were doing very well when Allen
Solly sales were falling,” he said.
Aditya Birla Retail, another group company which runs supermarkets and hypermarkets,
has closed 70 unviable stores of its more chain to improve profitability. Almost all retailers,
such as the Future group, Reliance Retail and others, have scaled down expansion as
shoppers defer purchases and down trade to beat the slowing economy.
Analysts cited high leverage positions and rising debt to equity ratios as reasons for the
slower expansion of retailers. “Across the board, expansion plans are being relooked, due
to capital scarcity and catchment reassessment. Given high debt levels and an almost
dormant equity market, the capital for growth has become scarce,” says a report from
Edelweiss Securities.
Mumbai May 18 The Aditya Birla group will invest up to Rs 9,000 crore over the next three
years in a pan-Indian chain of supermarkets and hypermarkets under the `More' brand
name.
"We intend to be among the leading players in India," Mr Kumar Mangalam Birla, Chairman,
told presspersons on Friday.
Aditya Birla Retail will compete with the other large industrial groups such as Bharti and
Reliance Industries, which have announced plans to invest, over time, Rs 10,000 crore and
Rs 25,000 crore respectively in their retail ventures.
The first few of its planned 1,000 supermarkets will open in Pune by June. 80
"How many hypermarkets we may open, that we will play by ear," said Mr Sumant Sinha,
who heads the company?
The company already operates 50,000 sq ft of retail space it acquired from the buyout of
Trinethra Super Retail, a South-based chain of retail stores, earlier this year.
The funds for the retail venture will be raised through a mix of debt and equity.
"We have a vibrant equities market," said Mr. Birla, adding that it was a generic comment
since retail companies worldwide have easy access to capital markets. "But we don't think
we need to do that."
None of the group's listed entities has invested in Aditya Birla Retail either, he added.
The group's listed entities are Grasim Industries, Hindalco, UltraTech, Aditya Birla Nuvo
and Idea Cellular.
The various holding companies in the group will be the promoters of Aditya Birla Retail,
according to analysts. But investment details were not disclosed.
Aditya Birla Retail does not intend to have a joint venture partner, as the group has the
necessary competencies in-house, said Mr Birla.
The supermarkets would be neighborhood stores catering to daily and weekly household
shopping needs of customers, while the destination hypermarkets would cater to monthly
shoppers and event-based needs.
The company would build linkages with farmers and architect supply chains to connect
households more directly to farmers, a statement said.
Apart from Mr Sinha, two expatriates have been recruited to head the supermarket and
hypermarket ventures.
They are Mr Andrew Denby, who has experience across the UK and South-East Asia, and
Mr Russell Berman, who has experience in China.
The company already employs 4,000 people and will have 10,000 employees within a year,
said Mr Sinha.
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Mr Birla refused to comment on the issue of the recent protests against corporate retail
activity in some States. Local traders had taken out protests against corporate retail stores
resorting to price undercutting.
The group would not have to contend with the FDI issue since it does not intend to have a
partner, foreign or otherwise.
Bharti, which has signed a MoU with Wal-Mart for its retail venture, has faced a lot of
opposition in this regard.
Bharti, however, has said that the front-end stores would be operated by itself, and only the
wholesale activities, cold chain operations and logistics by the joint venture with Wal-Mart.
FDI in multi-brand retail activity is currently not allowed in the country.
Taking cue from India’s largest business houses Reliance, Tata and Bharati, the $24 billion
Aditya Birla group announced its plans for the retail sector. The move will give the cement-
to-telecom conglomerate a piece of the action unfolding in the organized retail trade in
India.
Birla group that has recently acquired southern retail chain Trinethra launched the brand
name of its store- More. In the coming years, the group will invest Rs 9,000 crore for
entering into the $320 billion retail market, of which only 3 percent is organized.
According to Aditya Birla group chairman, Kumar Mangalam Birla: “The business will not be
funded by any of our listed companies. The investments will be through a mix of debt and
equity.”
It is worthwhile remembering that in the recent years, Reliance Industries and Bharti
Enterprises have said that they would pump in Rs 25,000 crore and Rs 10,000 crore
respectively for their retail ventures.
Initial signs are that new stores of Birla group will be made in two formats. First and
foremost, supermarkets of less than 10,000 sq ft and secondly hypermarkets of up to
75,000 sq ft. According to company sources, the first of its retail stores would come up in
Pune by next month. In the starting, company would set up around 1,000 super markets,
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but has not decided on the number of hypermarkets. All the different format of stores will
however sport the same brand name ‘more’.
“Our value proposition will be to offer more variety, cost effectiveness and a comfortable
and world class shopping environment,” pointed out Birla. At the present juncture, company
has a presence in south India through Trinethra, which has 170 outlets. The group is
working overtime to have a pan India presence and will eventually put up stores in big
metros too.
If experts are to be believed, the move is bound to spur another round of demand for real
estate across the country. The Aditya Birla group which already controls over half a million
sq/ft of retail space through Trinethra did not disclose the estimate of space needed for the
planned stores.
When journalists asked whether it would look at a foreign partner, Birla clearly said that the
group would not seek a joint venture partner, either domestic or overseas, for the retail
foray. “We have sufficient understanding of the Indian customers mind and we are not tying
up with any partner for the retail store,” pointed out Birla.
Pretty identical to Reliance, the Birla group also plans to build linkages directly with farmers
so they can ensure fresh supply if fruits and vegetables to customers. In the coming
months, the group hopes to hire thousands of young employees for their stores. It has hired
two expatriates with expertise in running super and hypermarkets in global markets.
With the opening of first store in Pune and announcing its retail plans, the Aditya Birla
Group has finally joined the crowded retail space. And from the voices in the media, it’s not
far when the group has a pan-India retail presence.
Organised retailing is just 3% of total retail market but still a debatable point whether the
Birla’s are an early or a late entrant. Since Pantaloons, Spencers, Subhiksha and Reliance
have already set up a good base, ‘More’ stores may find hard to invade the territory which
these stores have already captured in their respective locations.
But even then, key factors which may influence the buying pattern of consumers hinge on
convenience in terms of distance from home, pricing and giving the right product-mix
catering to different social and economic class. Since, organised retail has thin margins and
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high costs of around 15% to the revenues (as compared to 5-6% of local grocery stores),
retail companies should promote more their in-house brands which have a higher mark up.
Aditya Birla ‘More’ strategy to offer budget and high value private labels under ‘More for
you’ and ‘Select’ seems to be like successful UK’s Tesco model of having separate labels
with separate quality and prices for the same product category.
Till Bharti-Wal-Mart enters the market, the key competitor for ‘More’ shall be Reliance Retail
as they have similar store formats and product offerings. But the real tough part will be
when these two companies launch their hypermarkets, in which Pantaloon’s Big Bazaar still
rules the space in terms of nationwide presence, and then differentiation would play a key
role.
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Safal Daily Fresh in expansion mode:
The Safal Daily Fresh, part of the National Dairy Development Board, a unit of Mother
Dairy, which has opened its maiden retail outlet in Bangalore, is now gearing up for
expansion in Delhi, Kerala, Chennai and Hyderabad. It will invest Rs 80 lakh for each outlet.
The Daily Fresh outlet in Bangalore spans 2,500 sq ft and has over 1,000 stock keeping
units (SKUs) including bakery and confectionery.
Safal entered the vegetables and fruits vending scene though retail and wholesale outlets
referred to as 'Safal Market' which number 330 in New Delhi and Bangalore. In Bangalore
alone it has six wholesale outlets, of which one was converted into a modern retail outlet.
The remaining five are getting ready for a retail makeover and will also continue its
operations in wholesale. Bangalore has the capacity to have another 20 more Daily Fresh
outlets, which we are looking at once our operations are consolidated, Anil Kumar
Srivastava, CEO, Safal Market, told F&B News.
The concept of retail and wholesale has revolutionized purchase of fruits and vegetables.
The advantage of Safal Markets is a single central auction in which all business associates
participate buying from a single seller. There is total transparency and fair competition. The
Safal Market operates outside the purview of the APMC Act, stated Srivastava, he added.
In 2004, the company started the Safal Market at Whitefield on the outskirts of Bangalore..
The unique features are electronic auction hall, online bidding, advanced food handling
machine, world class food ripening chambers, climate controlled interim storage area and
commercial cold storage with a capacity of 10,000 tonnes.
Safal has also its own range of brands like frozen peas, juices, American sweet corn,
Mother Dairy products and Dhara edible oils. It is looking at introducing a dispensing unit for
juices and American sweet corn kiosks at its Daily Fresh outlets in the country. Safal
pioneered the concept of retail chain in 1988 in Delhi.
According to Srivastava, the advantage of Daily Fresh outlets and the Safal Markets are its
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reasonable pricing. Also supplies to the outlet are carried out around three times a day to
retain the freshness of the products.
"Since we deal directly with the farmer we can offer the right price to the grower and the
consumer which is a huge benefit and a major attraction to push our sales. At its Daily
Fresh outlet in Bangalore, it generates sales to the tune of Rs 1.25 lakh, which is expected
to touch Rs 2 lakh by the month-end. Primary drivers for such roaring sales were
convenience cost and customer footfall of 1,000 a day, he said
Fresh strategy: Safal, India’s oldest food and vegetable supply chain, is revamping outlets and expanding
its presence to stave off competition from private players’ large-format stores:
It started off as a central government initiative to help farmers get better
It was also aimed at helping consumers get fresh supplies of fruit and vegetables at a fair
price from retail outlets in the neighbourhood. Mother Dairy, which was already procuring
milk through associations in and around Delhi, was asked to do a pilot project on similar
lines for perishables. And thus was born India’s oldest food and vegetable supply chain,
Safal Daily Fresh, in 1987-88.
Safal soon became a unit of Mother Dairy Foods Processing, a wholly-owned company of
Mother Diary Fruit & Vegetables, which itself was created in the year 2000 as a subsidiary
of the National Dairy Development Board, a pioneer in India’s dairy sector. Safal’s turnover
has grown from Rs 2.7 crore to over Rs 300 crore at present. Almost 85% of its revenues
come from the sale of fresh fruit and vegetables, while the rest is from processed foodstuff.
Now, 20 years after its launch, Safal is gearing up for another challenge—competition from
corporate houses that have entered the perishable commodities space with large-format
stores and deep pockets. Already Mukesh Ambani’s Reliance Fresh chain, the Birlas, Bharti
and The Future Group, to name just a few, have muscled in, posing a big challenge to
established players like Safal.
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Time to spruce up:
What is Safal, a government-sponsored entity, doing to remain relevant in such a scenario?
A casual visit to any of the 400-odd exclusive Safal retail outlets across India will put any
customer off. Shabby racks and stale fruit and vegetables are the order of the day, the very
opposite of what the brand boasts of—quality and freshness. Private players, on the other
hand, have t We realise the changing market demand, and have started moving to improve
customer delight by better presentation and are trying to deliver products as fresh as
possible," says Sunil Bansal, Chief Executive Officer, Mother Dairy Fruit & Vegetables.
They are not empty words—a pilot project to give Safal a new look has just been concluded
at its Sarojini Nagar (New Delhi) outlet, and by the end of the year, 100 more outlets are set
to be revamped.
"We are expanding. From 400 outlets in Delhi and 14 in Bangalore, Jaipur is the next stop.
That will be followed by other cities. This will give us a pan-India presence," Bansal says.
"We are also bringing in the cash-and-carry model in select Delhi outlets to improve
volumes."
Safal outlets may be leased, rented or owned by Mother Dairy, but the onus of
management and product sales rests with the concessionaire (usually an ex-service man),
whose dead stocks are not taken back. While the handling, display and management of the
produce are done by the concessionaire, the rates of fruit and vegetables and running cost
of each outlet are decided by Safal.
In its new strategy, newer Safal outlets need not necessarily be given only to ex-service
men; and even if they are, a business ethics module is being prepared to train them in
better customer handling and presentation.
Safal is also expanding its portfolio of frozen, packed and cut vegetables. "People
are ready to pay. Depending on demand, we would be adding bitter-gourd, pineapple,
French beans etc in the cut-packaged category," says Vinod Khurana, the chief of its 22-
acre central distribution facility at Mangolpuri in Delhi.
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This unit has an annual capacity to process 120,000 metric tonnes of fruit and vegetables
received from over 12,000 growers spread across 16 states. In fact, it is this kind of forward
and backward linkage to the supply chain that private players are struggling to establish.
Aken a leap forward, with bright lighting, air
Safal wants to change customer perception of itself as a run-down place to shop for
perishables.
"They (the private players) poached our field staff for their experience and linkages with
farmers. What they failed to realise was that we work as a team, not as individuals. The
system is not dependent on one particular person," says Bansal.
Core strengths:
Safal’s two-decade-old expertise in supply-chain management is hard to match. Its entire
supply chain has been online since inception. This system is now being upgraded with a
new enterprise resource planning software. In the first phase, it will connect Safal’s various
units; and in the next, it will help connect the village collection centres.
Safal’s weekly payments are done through the farmers’ association bank account, from
where individual farmers are issued cheques. "There is complete transparency. We know
how much we will get and when, unlike in the mandi where payment schedules are not
fixed and commissions to agents are as high 10-15%," says 55-year-old Nil amber Tiwari of
Kheda village in Uttarakhand, who has been associated with Safal for almost 12 years now.
The rates are decided according to the demand-supply situation, but the procurement rate
is usually higher than the mandi rate. "Farmer benefit is the prime motive, and everything
revolves around that," says V Kathuria, an assistant manager with Safal, who also doubles
up as an adviser to farmers.
"It is our scale and procurement process that help us give the best prices—lower than
market rates for customers and higher than mandi rates for farmers," says Bansal. Safal’s
success lies in the relationships and linkages it has established with farmers over the years.
This ensures Safal is preferred over other buyers even if it is picking up less than 10% of a
farmer’s entire produce. In fact, Safal has emerged as a partner and advisor to farmers,
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right from the crop-planning stage to when the produce is Safal’s expansion plan is based
on leveraging its all-India supply chain strength and its low-cost model of using rented and
leased premises to sell its over 125 fruit and vegetable varieties. With 735 direct
procurement sources, 12,000 associate growers and more than 100,000 footfalls at its
outlets everyday, Safal looks well-poised to take on the private players
Fruit and Vegetable Unit was set up in the year 1988 by National Dairy Development
Board , an institute of national importance, a body corporate created by Government of
India , with an objective to provide a direct link between fruit and vegetable growers and
consumers. The unit has drawn on NDDB's three decades of dairy sector strengths in
designing it's state of the art large and ultramodern central distribution facility to handle
fresh and frozen fruit and vegetable.
Presently it is a unit of Mother Dairy Foods Processing Ltd, a wholly owned company of
Mother Dairy Fruit & Vegetable Ltd. In April 2000, Mother Dairy Fruit & Vegetable Ltd was
created as a subsidiary of NDDB. The processed products of the unit are marketed with the
brand name 'SAFAL'
Unit complex is situated on 22 acres of land. It comprises a prefabricated building
consisting of cold store chambers with different sets of temperature and humidity conditions
suitable for storage of various fruit and vegetables. It has controlled atmosphere chambers
and ripening rooms, deep freeze rooms, preparation hall, processing hall, dispatch hall,
reception, dispatch facilities etc. Material handling is done in specially designed plastic
crates with the help of forklifts
The Unit also initiates and supports production enhancement activities at farm, improved
pre and post harvest practices, efficient logistics from farm to the retail outlets, scientific
quality assurance and education of grower, support staff and consumer.
Production of quality product begins at the farm level where the grower, in co-operation with
unit officials, work to cultivate and supply quality produce to the Unit.
With the utmost care and dedication, the growers and Unit officials try to apply their
professional knowledge and skills to give consumers the best return for their money.
Standards are defined for each fruit and vegetable so as to link price to quality.
Procurement specialists and trained field staff help the farmers in crop management and 90
protection. Efforts are made to introduce new seed varieties and scientific methods of
agriculture to increase the yield and improve the quality of produce.
279 specially designed modern retail outlets have been set up in and around Delhi to
market fresh and frozen fruit and vegetables, directly to the consumers. Each shop caters
to large number of customers, with a capacity to sell 1,600 kilos of fruit and vegetables a
day. The shops are equipped with electronic machines that automatically weigh the
produce and print item wise bills.
Unit also manufactures products such as Jam, Squash , Ketchup etc at its Ramgarh unit.
Fruit & Vegetable Unit is IS/ISO-9002:1994 / DIN EN ISO 9002: 1994 & HACCP Certified
Organization
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Spencer’s
Company Profile Spencer's retail is the largest* supermarket chain in India. We offer a
complete range of products & durables, from bread to bed cover; from toothpaste to even
television sets. Today Spencer's has 100 stores spread across 25 cities with a retail trading
area of more than half a million square feet, and we're growing rapidly. Spencer's is the
shopping choice for millions across the country, 2.8 million to be exact, who frequent our
stores every month.
Today Spencer's offers its customers a customized and convenient shopping experience in
5 different formats. Each format, namely the Spencer's Express, Spencer's Fresh,
Spencer's Daily, Spencer's Super and Spencer's Hyper is differently sized and caters to the
various needs of our consumers. We at Spencer's offer a pleasant and delightful shopping
experience by ensuring convenient store locations, trusted quality, great value for money
and a wide array of products. And these qualities characterize all of our 100 stores, across
the country
Quality’ is a time-tested phrase, which has been ingrained in the minds of the Indian
consumer for over 100 years now. And it still continues to evoke a warm aura of trust and
goodness. In 1863, since we first opened our gates to the Indian consumer, we have like all
successful businesses, re-invented ourselves with the times. But our endeavour, by which
we still stand firm, has always been to provide a pleasant and delightful shopping
experience for you, our valued customer. As RPG, when we took over Spencer’s, we
pioneered the retail revolution in India, by introducing the concept of specialty stores like
FoodWorld, Health and Glow and Music World. And this pioneering spirit still burns strong.
We feel proud to share the fact that in 2000, we introduced the Indian consumer to the first
ever Hypermarket
Spread over 12000 sq ft, the store has more than 8000 domestic and international
products of the finest quality and value across multiple categories
Located in Saili Road, Near Patel Chowk, this is Spencer’s first store in Pathankot
and 25th in Punjab
Spencer’s Retail Limited, one of India’s largest multi-format retailer chain, today
inaugurated a 12000 sq. ft multi-format store in the city. The store is the largest of its kind 93
with respect to the space it occupies and the range and assortment of products its offers.
This is also the first Spencer’s store in the city and the 25th in the state of Punjab.
Speaking at the launch, Satyaki Ghosh, Vice President, Operations and Business
Development (Northern region), Spencer’s, said:
“Modern retailing is gaining steam in Punjab. We have about 20 stores in the state which
have received overwhelming response from the people and are running profitably.
Shoppers have realized the benefits of such stores which offer a one-stop solution for all
their shopping needs. We are confident of a similar response from this city as well, as we
bring them the finest quality of products in food, fashion, home and entertainment at
reasonable price points and all under one roof with our 150 year old understanding of the
retail industry, we are positive about making Pathankot yet another success story for us.”
The Pathankot store is spread over 10000 sq. ft and offers a wide range and assortment of
merchandise in food and grocery, fruits and vegetables, electricals, home and office
essentials, garments and fashion accessories, toys and personal care. Imported food
products and a broad choice in regional preferences are also available at the store.
Specialty range include Bengali, South Indian offer a broad spectrum of ingredients of these
regional cuisines. A specialty and organic foods section, an extensive chilled and frozen
counter, and variety of food take-away options promise to gratify every variant of the
consumer’s shopping requirements. The store also has a refreshment and snacking zone
that includes, among other things, like A-One Cakes-n-Bakes & Sweets and Quality Ice
Creams.
The store décor, designed by international retail brand and store design consultants gives
an international ambience comprising modern day store fixtures, curved signages to
provide zone identification and give visual relief, top of the line in-store navigational aids
and state of art in-store communication elements ensuring the best overall shopping
experience. Carefully selected wood veneers, vitrified tiles, specialized retail illumination,
along with a combination of warm tones and white lighting, visual merchandising, feature
displays and innovative merchandize presentation complement the warm and friendly,
upscale look and feel of the stores. In fact, Spencer’s is the first organization to bring in
international in-store design to suit the preferences of today’s inspirational shoppers.
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Early next year Spencer’s will be coming up with one of its largest stores, spreading over
40000 sq.ft area, in the Northern Region in Chandigarh. Following that couple more Hyper
are slated to come in Ludhiana and Bhatinda by the end of the 2009 Financial year.
Currently, the organization runs 400 stores of which 35 are large format. By the end of
March 09, the company plans to increase the total no of stores by another 300, which would
include 75 large formats.
Technical details of store:
Total area: 10716 sq. ft
Categories available:
o Food and grocery including FMCG processed foods
o Fresh fruits, vegetables & exotic range
o Specialty and international foods
o Personal Care, cosmetics and fragrances
o Home and office essentials
o Electricals
o Garments and fashion accessories for men, women and children
o Food court / café
No of SKUs: Over 8000
Specialty attractions
o Chilled and Frozen
o Bakery and Food Services
o Home meal replacements
o Organic and Exotic food products
o International food range – Thai, Chinese and Italian
According to Sanjeev Goenka, vice chairman of the RPG Group, the number of Spencer's
retail stores would increase to 650 from the present 400 within the current fiscal year.
The expansion would help Spencer's earn revenue of Rs.1800 crore ($450 million) during
the current fiscal year (2008-09), up from Rs.1000 crore ($250 million) it earned a year
earlier (2007-08).
The funds for the expansion would be raised from a mix of debt and internal accruals.
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"It will be from internal accruals or public money, which could be either private equity or an
IPO (initial public offering). But as of now, for next couple of quarters, it will be entirely
through our own funding," Goenka said.
According to Goenka, Spencer's Retail would also enter into "multiple" tie-ups with
international firms across various product categories. "It will be in apparel. It could be in
cafes. It could be for kids," he said.
Private labels in apparel, in particular, have helped maintain margins and increase sales,
Goenka said.
"We have over 450 products in private labels and this range is increasing every day. We will
need to increase it more aggressively to maintain margins and we do believe there is scope
for it as customers become loyal to brands," he said.
Spencer's Retail would also be rolling out new fashion labels that are contemporary and
chic, Goenka said. "Fashion is a significant segment of the country's retail industry as it has
influenced lifestyle in a big way. With consumers' new look-good and feel-good attitude,
fashion offers huge potential to tap the untouched markets," he said.
Spencer's Retail, which currently operates 400 stores across 65 cities in India under
different formats like Supermarket, Hypermarket, Express and Dailies, covering a retail
trading area of 2 million square feet, competes with other retail chains like Future Group's
Big Bazaar, A.V. Birla Group's More and Reliance Industries' Reliance Mart.
India's booming retail market, estimated at about $300 billion, is growing at a brisk pace of
30 percent per annum, driven by rising middle class incomes and an increase in demand
for branded products.
Largely dominated by more than 15 million unorganized retail stores across the nation,
organized retailing, selling through company-owned network stores, remains a rarity,
currently totaling about $8 billion or less than 5 percent of trade in the country.
However, according to AT Kearney, revenues from organized retail are expected to triple to
about $ 24 billion by 2010, a reason why retail giants like US-based Wal-Mart Stores Inc.,
Germany's Metro AG, France's Carrefour and UK's Tesco Inc. are exploring ways of
entering the fast growing market.
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However, Indian rules currently allow 51 percent foreign direct investment (FDI) in retailing
by companies that sell only a single brand like Reebok, Nike, Nokia or Benetton or Mark &
Spencer (which recently finalized a joint venture with India's Reliance Industries).
On the other hand, multi-brand retailers, such as Germany's Metro AG or US-based Wal-
Mart Stores Inc. (which has entered into a wholesale business tie-up with India's Bharti
Group) are only permitted to run cash-and-carry or wholesale operations or to offer
backend support to Indian retailers.
ABOUT RPG GROUP
RPG Enterprises is a $3.4 billion business conglomerate, operating more than 20
companies and spanning across 7 business sectors viz., Retail, Technology, Entertainment,
Power, Transmission, Tyres and Specialties.
Spencer’s set to re brand small retail format stores:
Mumbai, Jul 17 : Spencer’s Retail Ltd, part of the Rs 13,500-crore RPG Group, is all set to
re-brand its small retail format stores from “Spencer’s Daily” and “Spencer’s Express” to
Spencer’s and relocate some of the stores to newer locations due to poor demand. On the
other hand, plans are also on the anvil to focus on setting up 75 large-format hypermarkets
in India by March 2010, Samar S Sheikhawat, vice-president - marketing, Spencer’s Retail
told FE.
According to Sheikhawat, “With this move, Spencer’s Retail Ltd will now have only two retail
formats. It includes, “Spencer’s” for small-format retail stores with an area size of 2,000 sqft
to 10,000 sqft, and, “Spencer’s Hyper” with over 40,000 sqft for hypermarkets.” Currently,
Spencer’s Retail Ltd runs 368 supermarkets, including 32 large-format stores.” As for the
rationale behind the move, Sheikhawat explained, “It has been observed that rentals for
large size properties are seen falling by about 40% in the metros, as the prices are now
becoming negotiable. Hence, it is affordable to lease out larger properties for setting up
hypermarkets than expanding more small-format stores. We have recently relocated
Spencer’s supermarket store in Kolkata, Kerala and Hyderabad. Other cities too will witness
similar trend.” By the year-end, Spencer’s Retail plans to set up a 70,000-sqft hypermarket
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at Thane and at Vasai. Sheikhawat said, these properties were signed even before
Spencer’s hypermarket was launched at Malad.
Spencer’s Retail now plans to double the number of private label brands from 5,000 to
10,000 as private labels has contributed 15% of the 25% to Spencer’s Retail’s overall sales
turnover in the past 18-20 months, he informed.
Sheikhawat added, “In order to combat rising inflationary trends, we are planning to start
home meal replacement (HMR), a new take-away meal trend at Spencer’s hypermarket
apart from launching ‘Innovative promotions’ such as food festivals -Thai, Brazilian among
others. Plans are on the anvil to start at home contact programmed for women, apart from
contact programmed for school children in order to promote various kids competitions as
well.”
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RESEARCH METHDOLOGY
INTRODUCTION:
Research in Common parlance refers to search for Knowledge. It’s a scientific and
systematic search for pertinent information on specific topic. Research is an art of Scientific
investigation its mean Systematized effort to gain new Knowledge.
According to Clifford woody “Research Comprises defining and redefining problem
formulating hypothesis or suggested solution Collecting, Organizing and evaluating data
making deductions and reaching Conclusion at Carefully testing the Conclusion to
determine whether they fit the formulating hypothesis.
In Short the Search for Knowledge through Objective and systematic method of finding
solution to a problem is research its refer to the systematic method Consisting enunciating
the problem, formulating a hypothesis, Collecting the fact or data analysis the fact and
reaching Certain Conclusion in the form of Solution.
TYPE OF RESEARCH
THERE ARE TWO TYPE OF RESEARCH DESIGN ARE FOLLOWING:-
DESCRIPTIVE RESEARCH DESIGN
QUANTITATIVE RESEARCH DESIGN
DESCRIPTIVE RESEARCH DESIGN:
Descriptive research includes survey and fact finding enquiries of different Kinds. The
major Purpose of descriptive research is description of State affairs as it exists in
present. In social and business research we quite often use. We have done Survey
found fact by personal interview so it is descriptive.
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QUANTITATIVE RESEARCH DESIGN:
Quantitative research is based on the measurement of quantity or amount. It is applicable
to phenomena that can be expressed in term of quantity. We have also found requirement
in quantity so it’s the quantitative research.
Duration of project: - 6 weeks
POPULATION
Specific Area:- Vaishali Nagar
C-Scheme
SAMPLE DESIGN
Sample design refers to the technique or the procedure the researcher would adopt in
selecting item for the Sample. Sample design may be well lay down the number of items to
be included in the sample that is the size of the sample design is determined before data
are collected. There are many Sample designs from which a researcher can choose some
designs are relatively more precise and easier to apply than other researcher must select a
sample design which should be reliable and appropriate for his research study.
Here we have used random sampling and the sample size was 50. We have
made a questionnaire through personal interview filled the questionnaire.
DATA COLLECTION
Basically there are two main method of data Collection primary data and Secondary data.
Primary data are those which are Colleted freshly and the first time and thus happen to be
original in character. Other hand Secondary data are those which have already been
collected by someone else and which have already been passed through the Statistical
granting.
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PRIMARY DATA:
QUESTIONNAIRE METHOD: -
This method of data collection is quite popular, particularly in case of big enquiries. It is
being adopted by private individuals, research workers private and public organization and
even by governments in this method a questionnaire Consists of a number of question
printed or typed in definite order on a form or set of form I have made a Questionnaire for
Survey.
PERSONAL INTERVIEWS:
The interview method of collecting data involves presentation of oral verbal stimuli and reply
in term of oral verbal responses. We have used this method through personal interview.
SECONDARY DATA:
Secondary data means data that are already available they refer to the data which have
already been collected and analyzed by someone else. We have used for it following
method Internet and journals of company. As I used journals related to local market,
reliance fresh, more and safal, which was very useful.
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OBJECTIVE OF THE STUDY
The Purpose of research is to discover answer to question through the Application of
scientific procedure. The main aim of research is to find out the truth which is hidden and
which has not been discovered as yet.
To know and apply different market research techniques in our study as follows:
o Sampling Design
o Research Methodology
o Questionnaire Design
To highlight the satisfaction level regarding products
To know the perception regarding vegetable buying behavior of consumer
My project will try to understand that why after reliance fresh or other vegetable retail
store consumer buy vegetable from local market.
It also helps to relate what type of marketing strategy reliance fresh is using to attract
consumers.
From where a consumer want to purchase vegetables.
To gain familiarity with a phenomenon or to achieve new insights into it (Studies with
this object in view are termed as exploratory or formulate research studies)
To Portray accurately the characteristics of a particular individual Situation or a group
(Studies with this object in view are know as descriptive research studies)
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LIMITATIONS:
Due to the financial & time constraints the study was limited to our place thus the
conclusion arrived in the end rely in short term experience.
Being an opinion survey the personal bases of the respondents might have entered into
their responses.
Time constraints resource constraints were some of the limitations.
The selected sample might have affected the results of the study therefore the findings
& conclusions of the study are only suggestive & not conclusive.
Sample was chosen according to convenience & judgment sampling & not according to
random sampling.
The sampling error that appeared due to the kind of sampling technique adopted.
Indifference and lack of interest disposed by a few respondents leading to unauthentic
responses.
Time proved to be a major constraint as far as collection and analysis of data was
concerned.
To overcome the above limitations and to minimize their impact on the findings of my
report I had to meet more respondents than my actual sample size
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FACTS &FINDINGS
As part of the project we had make a survey with the help of questionnaire that has to taken
to different people to get perception towards local vegetable market and organized retail
store. The questionnaire is passed on the general public and requested to give their opinion
that from where they would like to buy vegetables and why? The questionnaire Consists of
both open and close ended question the main motto behind the Study is to find out how
people react against the retail store and local vendors.
In research methodology we have used random sampling and sample size was 50.
Simple random sampling method is followed where every member of population have equal
chance of been selected. The questionnaire is administrated on sample to find out their
perception local vegetable market and organized retail store. After analysis of questionnaire
Conclusions were made based on finding from pie charts and graph.
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Data Analysis
Topic: - vegetable buying behavior of consumer
Q. who usually goes to buy vegetable in your family?
Table representation
Graphical representation:
0%
10%
20%
30%
40%
50%
you you withkids
spous with family
Respondent were asked to rank the various option according to their preference.
From the figure we can derive that the, 42% people go their by own to buy vegetable.
And after that people buy to go vegetable with family.
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Options Number Percentage (%)
you 21 42%
You with kids 7 14%
Spouse 5 10%
With family 17 34%
Which give them choice to buy according to their needs?
Q.In a week how many times you go to buy vegetables?
Table representation
Option Number Percentage
One time 6 12%
2-3 times 28 56%
Daily 16 16%
Graphical representation:
0%
10%
20%
30%
40%
50%
60%
one time 2-3 time daily
From the graph it can be seen that majority of the respondent go to buy vegetable mostly 2-
3 times, which makes there diet healthy, because by such they may buy fresh vegetable.
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Q. How much quantity you purchase in a particular day?
Table representation
Option Number Percentage (%)
1-2 kg 22 44%
3-5kg 18 36%
More then 5 kg 10 20%
Graphical representation
0%
10%
20%
30%
40%
50%
1-2kg 3-5kg more then 5kg
From the graph we can see that.mostally people buy 1-2 kg vegetable in a times, it will
keep there diet healthy.
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Q. From where do you prefer to buy vegetable-vendor or retail and why?
Table representation
Option Number Percentage
retail 35 70%
vendor 15 30%
Graphical representation
0%
10%
20%
30%
40%
50%
60%
70%
80%
vendor Retail
Here we may see by the graph that respondent still wants to buy vegetable from local
vegetable market.
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Q.Which retail outlet you prefer to buy vegetables?
Table representation
Graphical representation
62%
14%6% 8%
2% 4% 4%
0%
10%
20%
30%
40%
50%
60%
70%
Localmarket
Reliancefresh
More Spencer 6 to 10 safal Anyother
From graph it can be seen that majority of the respondent Here people use to go to buy
vegetable from local market.
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Options Number Percentage (%)
Local market 31 62%
Reliance fresh 7 14%
More 3 6%
Spencer 4 8%
6 to 10 1 2%
safal 2 4%
Any other 2 4%
Q .why you prefer such outlet?
Table representation
Option Number Percentage (%)
Price 10 20%
offer 12 26%
variety 20 40%
Style symbol 8 14%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Price offer variety Style symbol
From the figure we can derive that, mostly respondent prefer to buy vegetable from retail
store due to variety, because it gives them variety which local market vendor are not able to
give.
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Q. Do you find any display difference in outlets?
Table representation
Option number Percentage
Yes 44 88%
No 6 12%
Graphical representation
88%
12%
yes
no
From graph it can be seen that majority of the respondent find display difference in retail
outlets, which make it different from other.
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Q.What you prefer price or quality?
Table representation
Option Number Percentage (%)
Price 4 8%
Quality 46 92%
Graphical representation
0%
20%
40%
60%
80%
100%
Price Quality
From graph it can be seen that majority of the respondent prefer quality, because it gives
direct impact on their health.
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Q.Do you find any price difference from local vegetable market and organized retail outlet?
Table representation
Option Number Percentage
yes 47 94%
No 3 6%
Graphical representation
94% 6%yes
no
From the graph it can be seen that, there is difference in price between retail store and local
vegetable market.
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Q. Do you go to buy vegetable from retail outlet when offer is available?
Table representation
Option Number Percentage
yes 7 14%
No 43 86%
Graphical representation:
14%
86%
yes
no
Here by graph as no. of respondent respond that most of the people do not go to retail store
when offer is available, only 14 % people prefer such offers.
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Q. what do you think is future of vegetable vendor, will they vanish or they survive?
Table representation
Option Number Percentage
yes 43 86%
No 7 14%
Graphical representation
86%
14%
yes
no
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As may be seen in graph the future of vendor in India is safe because still prefer to go to
buy vegetable from local market, due to fresh and cheap vegetable, and easily available to
all places.
Q. Generally, it is seen that vegetable available with vegetable vendor are greener and
fresher than retail outlets.
Table representation
Option Number Percentage
yes 42 84
No 8 16
Graphical representation
84%
16%
yes
no
From graph it can be seen that majority of the respondent prefer vendor to buy vegetable
from local market, every body wants safe and healthy life and vegetable has direct
connection with health so people prefer fresh vegetable, and people believe that in local 118
market vegetables are so fresh because it comes directly from farm without any
intermediaries and they sell vegetable in reasonable rate.
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SWOT ANALYSIS
SWOT Analysis, is a strategic planning tool used to evaluate the Strengths, Weaknesses,
Opportunities, and Threats involved in a project or in a business venture. It involves
specifying the objective of the business venture or project and identifying the internal and
external factors that are favorable and unfavorable to achieving that objective
SWOT Analysis is a best way to view the organization’s strategic situations. It helps to form
a basis for deciding on the extent to which a change in the strategy is necessary.
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Strengths:
Local vendors:
. Available in large no.
Easily approachable
Retail sector:
Retailing is a “technology-intensive" industry. It is technology that will help the
organized retailers to score over the unorganized retailers
Successful organized retailers today work closely with their vendors to predict
consumer demand, shorten lead times, reduce inventory holding and
ultimately save cost.
They introduced two innovative logistics techniques – cross-docking and EDI
(electronic data interchange).
Weaknesses:
Local vendors
Unmanaged
Low customer retention
No brand
Retail sector:
Less Conversion level: Despite high footfalls, the conversion ratio has been very low in the
retail outlets in a mall as compared to the standalone counter parts. It is seen that actual
conversions of footfall into sales for a mall outlet is approximately 20-25%. On the other
hand, a high street store of retail chain has an average conversion of about 50-60%
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Opportunities:
Local vendors:
The Indian middle class is already 30 Crore & is projected to grow to over 60 Crore by
2010 making India one of the largest consumer markets of the world.
Retail store
Organized retail is only 3% of the total retailing market in India. It is estimated to
grow at the rate of 25-30% p.a. and reach INR 1, 00,000 Crore by 2010.
India's huge rural population has caught the eye of the retailers looking for new
areas of growth.
The 'retail boom', 85% of which has so far been concentrated in the metros is
beginning to percolate down to these smaller cities and towns
Threats:
Local Vendor
If the unorganized retailers are put together, they are parallel to a large supermarket with
no or little overheads, high degree of flexibility in merchandise, display, prices and turnover.
Retail
Shopping Culture: Shopping culture has not developed in India as yet. Even now malls are
just a place to hang around with family and friends and largely confined to window-
shopping.
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RECOMMENDATION
Adequate training improves the skill of employee.
Company should put stress on supply chain management
Adequate transparency in price and weight.
Retail should Maintain proper Customer relationship
Company should take care its weekly review of customer to get customer
loyalty and to know the growth.
Store must be available at foot step, so try to open other stores.
There must be proper management information system in retail
Time to time retail store launched new offer for the customers with extra unique
features.
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Conclusions
Conclusions are the final paragraphs of an essay in which the write sums up the main point,
concluding the discussion. They are often the most difficult part of an essay
Conclusion of this study states that Agriculture plays a very important role in the economy
of a country. It has made a significant impact in the advancement of our country’s economic
growth.
Vegetables play significance role in Indian cusin in any part of the country. And Indians are
very much care for healthy food
As time changes buying behavior is also changing now days many retail sector are trying to
attract customers by opening retail store namely reliance fresh, Spence ,safal ,more, but
local vegetable vendor are still here with high profit
In India local vegetable future is safe because still people prefer to go buy vegetables from
local vendors.
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Question for customer
Name ……………………………………………………….
Sex…………………………………………………………..
Age…………………………………………………………..
Address……………………………………………………..
Q1.How many members are in your family?
……………………………………………………………..
Q2.Who usually go buy to vegetable in your family?
a) you
b) you with kids
c) your husband/wife
d) with family
Q3.In a weak how many times you go to buy vegetables?
a) one time
b) 2-3 time
c) daily
Q4. How much quantity you purchase in a particular day?
a) 1-2 k.g.
b) 3-5 k.g.
c) More then 5 k.g.
Q5. From where do you prefer to buy vegetables-vendor or retail and why?
…………………………………………………………………………………………………………
…………………………………………………………………………
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Q6.Which retail outlet you prefer to buy vegetables?
a) local market
b) reliance fresh
c) more
d) safal
e) Spencer
f) 6 to 10
g) Any other
Q7.Why you prefer such outlet?
…………………………………………………………………………………………………………
……………………………………………… … …………………….
Q8.Do you find any display difference in outlets?
a) yes
b) no
Q9.What do you prefer price or quality?
a) price
b) quality
Q10.Do you find any price difference from local vegetable market and organized retail
outlet?
a) yes
b) no
Q11.Do you go to buy vegetables from retail outlet when offers available?
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a) yes
b) no
Q12 what do you think is the future of vegetable vendor, will they vanish or they survive
(talking in terms on Indian market behavior)?
…………………………………………………………………………..
…………………………………………………………………………..
Q13 Generally, it is seen that vegetables available with vendors are greener and fresher
than retail outlet? Please comment
……………………………………………………………………………..
………………………………………………………………………………
Thank you
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BIBLIOGRAPHY
Internet:
www.wikipedia.comwww.google.com: http://www.hindu.com/2007/09/30/stories/2007093057550100.htmwww.india-reports.com
Magazines:
Business Today (Various Issues)Business World (Various Issues)Business India (Various Issues)
News Papers:
Economic timesBusiness standardBusiness lineFinancial express
Text books:
“Research Methodology” By C.R.Kothari.
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