retail industry: an opportunity.. background - us retail is organized to the extent of 80%, while...
TRANSCRIPT
Background -
US retail is organized to the extent of 80%, while the share of organized retail in Western Europe is about 70%.
Share of organized retail in countries like Malaysia, Thailand, Brazil, Argentina, Philippines is between 30- 50%. However, share of organized retail in India is about 3% and is still at a nascent stage.
Organized retailing in India has been largely an urban phenomenon with affluent classes and growing number of double-income households.
Growing urbanization leading to a variety of customer needs.
Significant increase in the number of brands in the Indian market leading to a larger option set for the Indian customer.
Media boom leading to an increased level of awareness and exposure to the international trends and concepts.
Changing demographics propelling the growth of retail industry.
There has been a shift from Hi-street shopping to malls or hypermarkets.
Shopping is becoming an outing or a way of family entertainment that means that families now spend greater time in shops.
Hyper market is largely a function of product mix, assortment and size. Broadly, they are driven by the following -
Store size – up to 40,000 sq ft
Assortment - Food, Grocery, Basic Range of General Merchandise
General Merchandise – Home, Apparel and Hardlines .
Customers look for value/ deals or promotions.
Store is managed by limited sales associates.
Brands have their own equity and so, help retailer in getting more footfall.
Brands understand their products and domestic market well and can use their knowledge and market understanding to their advantage.
Understanding of seasonality. Help in putting together “Home fashion concepts” and increase their sales volume.
Consistent and focused approach.
9
Home Textile - Category Mix
Bed, 48%
Bath, 18%
Kitchen & Table, 5%
Curtains, 7%
Upholstery, 10%
Floor, 12%
Bed Bath Kitchen & Table Curtains Upholstery Floor
2010
Bed, 45%
Bath, 16%
Kitchen & Table, 5%
Curtains, 4%
Furnishing & Upholstery,
18%
Floor, 12%
Bed Bath Kitchen & Table Curtains Furnishing & Upholstery Floor
2007
Source – Technopak
Impulse Vs Planned Purchase – Home Textiles
46
48
19
13
47
24
54
52
79
87
53
76
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
B E D L I NE N
B A T H L I NE N
C U R T A I NS
U P HOLST E R Y
K I T C HE N L I NE N
C A R P E T S A ND R U G S
I mpul s e P ur c has e C ons i der ed P ur c has e
Source – Technopak
Five Things Differentiate Manufacturers in the Eyes of Retailers –
Retailers view leading manufacturers as those:
Who are best aligned with their marketing plans and strategies; With whom they have highly productive and cohesive relationships;
Who possess advanced shopper marketing competence;
Who develop unique and exclusive programs; and
Who can deliver powerful insights on the consumer and the shopper
“Build Private label program” How does it help to retailer –
Differentiate the products for retailer Enhance margins Retailer completely owns the property; so promote it
How does it help to manufacturer –
Commitment of retail space Limited but continuous volume production Enhance understanding of retail business
Does customer get a feel that our products are affordable. How can I create more fun and excitement for the customers.
Is she saving some money when buying from us
How can I provide all Essentials with some value add-ons.
Can we demonstrate some fashion or decorative concepts in the store so that customer can relate to.