WHAT IS CO-OPERATIVE SOCIETY?

Co-operative is a form of organization where people voluntarily associate together as human being on the basis of quality and work together for a common goal. The main spirit of co-operation is EACH FOR ALL AND ALL FOR EACH

INTRODUCTION TO CONSUMER COOPERATIVES:A consumers' cooperative is a business owned by its customers for their mutual gain. t is a form of free enterprise that is oriented toward service rather than pecuniary profit. The customers or consumers of the goods and!or services the business provides are also the individuals who have provided the capital required to launch or purchase that enterprise. A consumers cooperative may be supermarkets" convenience stores" and other businesses owned by independently-owned" and run Cooperative societies" which benefit from #oint co-ordination and cooperation in managing their businesses. As mutually-owned businesses" each member of a society has a shareholding equal to the sum they paid in when they #oined.

STRUCTURE OF CONSUMER COOPERATIVES:The consumer cooperatives have a four tier structure comprising primary consumer stores with branches functioning at the grass root level" the wholesale ! central consumer stores with their branches at district ! taluka level" the $tate Consumer Cooperative %ederations at the $tate level" and the &CC% of ndia 'td." at the national level.

NATIONAL CO-OP CONSUMER FEDRATION

STATE CO-OP CONSUMER FEDRATION

WHOLESALE STORES

DEPARTMENTAL STORES

PRIMARY CONSUMER CO-OP STORES

CONSUMER COOP STORE FOR RURAL ()(*'AT )&

CONSUMER CO-OP STORE FOR INDUSTRIAL +),-.,$

UNIVERSITY COLLEGE CONSUMER STORE

APNA BAZAR
FOR US CUSTOMER IS FIRST

INTRODUCTION:Apna /azaar is probably the oldest and largest consumer cooperative multi-state society with a customer base of over 01 lakhs. The ,s 023-crore retail chain that" for over 44 years remained largely 5middle-class6 has 73 outlets in 8umbai" Thane and the neighbouring -onkan region. t has recently opened its first shop outside the 8aharashtra state" in 9oa. Apna /azaar has developed a strong brand image in the mind of the consumers. t en#oys strong consumer loyalty. There are #ust 2:-4: consumers who shift over to other retail stores. Brand name - 8umbai -amgar 8adhyavarti 9rahak $ahakari 8andal 'td Da!e "# In$"r%"ra!&"n - ;th 8ay 0;27 and it has now completed <3 years. C"n'!&!(!&"n 8ulti $tate Co-operative $ociety

HISTORY:n ;T= 8ay 0;27 it started by mill workers on share of ,s. 03 each with The &aigaon 9rahak $ahakari 8andal 'imited" which became 8umbai -amgar in 0;47-4; after other consumer coop. societies merged into it. n 0;<1-<> the organization became 8adhyawarti 9rahak $ahakari 8andal. n 0;7<"

the organization started the nation?s first departmental store on the mill worker dominated areas like &aigaon" under the name of APNA BAZAR. n a short time the brand APNA BAZAR grew popular all over 8umbai and has never looked back since. After successfully establishing a wide network of branches all over 8umbai" new branches were opened along the -onkan stretch following demand. %urther franchisees were encouraged" giving livelihood opportunity to many entrepreneurs.

OBJECTIVES OF APNA BAZAR:0. To take effective measures to ensure price stabilization and supply of goods to the consumers at reasonable price i.e. below the 8,(. 1. To procure" produce and make available a range of consumer goods under one roof. >. To avoid e@ploitation of consumers 2. To create awareness among the consumers and protect them from black marketing. 4. To provide quality goods at right quantity with ma@imum customer satisfaction. <. .fforts to make shopping a pleasurable e@perience

MANAGEMENT STRUCTURE:The /oard of Airectors changes every 4 years and the e@ecutive committee keeps changing annually. All the members render their service on honorary basis.

MANAGING COMMITTEE BOARD OF DIRECTORS

CHAIRMAN

VICE-CHAIRMAN

E)ECUTIVE COMMITTEE

UNION LEADER

CHIEF E)ECUTIVE OFFICER

GENERAL MANAGER

MARKETING STRATEGY:THE 4 PS OF APNA BAZAR PRODUCT:nitially they sold food grains and other grocery items. )ver a period of time they started adding variety of products to their sales. t includes products like plastic items" toiletries" stationary items" pharmaceuticals" household articles etc. of various companies. n addition to this they have their own products like spices" pickles" papads" etc. having their brand name in it. All these products are of good quality and high standards.

PRICE:All goods sold at apna bazaar are below 8,(. the pricing strategy adopted by them is as followsBPURCHASING COST+ MARGIN= NOT ABOVE MRP After considering the 8,(" their profit margin varies from 03 to 04:" even if the profit is nil or as minimal as rs.3.43.

PROMOTION:Apna /azar being a co operative society cannot incur heavy advertisement e@penditure because they have to keep their cost low. nspite of low advertisement they are able to attract customers because of their good image and e@cellent services.

nspite of their low profit margin they offer attractive offers for their customers. This is evident in the discount which they offer on medicines. TYPE OF CITI*EN $.& ), C T C.& 9.&.,A' (*/' C DISCOUNT OFFERED ON MRP <: 4:

They offer after-sales services and entertain e@change of products in case of any defects.

PLACE:The location for the store is selected taking in consideration the residential population in the area" the standard of living of the people" the amount of business the other shops are doing and also future development that are likely to take place in that area in future. The minimum requirement of area for setting up Apna /azar is 0333 sq.feet. The biggest store is at Dashi" which is spread across 1E333 sq.feet. n 8umbai it has <7 outlets" 00 outlets in -onkan and 0 in 9oa. )f these there areB 0. Aepartmental stores F 7 1. $upermarkets F E >. 8edical stores F 2 2. %ood stores - 12 4. %ranchisee stores F >E

EMPLOYEE BENEFITS: All the workers of Apna /azar are paid the minimum wages of ,s.>;33 per month. They are entitled to other benefits like 9ratuity" (rovident %und" /onus and .$ . They have an authorized union for their workers? The provision of Doluntary ,etirement service GD,$H is made available to their employees. There is a scope for every worker to progress which is possible due to the training programs undertaking by Apna /azar+ f an employee requests for a transfer to a location which is nearby to his!her residence" then he!she can transfer his!her #ob with the concern of higher authorities. Apna /azar is very much concerned about its employees and workers. Their concern is evident as they have displayed a list of items" quantity and the size of bags to be used for packing in the warehouse where packing is done.

Cu !"#$% B$&$'(! : Their practice of pricing the product at a low margin is ultimately passed on to the customers in way of products priced below 8,(. The customers hesitate to e@change or complain in case of any defective products in big malls which is not the case in Apna /azar. Apna /azar also fulfills social responsibilities as they arrange awareness programs and demonstration for consumers which enables the consumers to differentiate between the original and duplicated products and also helps them in identifying adulterated goods. f the prices of certain commodities increase" Apna /azar

makes sure that they don?t increase the price but they reduce their margin till they are able to accommodate their purchasing cost. The customers are assured that slight price fluctuations in certain commodities will not affect the price of Apna /azar?s product.

PROCUREMENT AND INVENTORY MANGEMENT:

The goods are purchased from A(8C market. The packing is done in A(8C market or by reliable suppliers. %or some food products which they manufacture on their own packing is done by them. To ensure minimum inventory and ma@imum rotation" they have centralized the supply chain management. +hile the super markets are serviced directly by the companies" the requirements of franchisee outlets are met by Apna /azaar to ensure better coordination. /ack-end automation has already been started in some stores with specific emphasis in areas of inventory management. The front-end and back-end of si@ department stores in 8umbai are computerized.

TARGET SEGMENTS:The store was started keeping in mind the lower middle class section of the society. /ut gradually it has moved up the consumer ladder with the inclusion of the middle class as its target consumer. &ow slowly it is drawing the upper class towards it. t now caters to almost all the segments of the society depending on the location.

SOURCES OF INCOME:,etailing is their core activity and a ma#or part of their ncome comes from various sources likeB 0H They supply commodities like Aal" (ulses" %ood grains" Cereals to 9ovt. nstitutions" =ospitals for their canteens. A >3 Aays credit is given to them. 1H They also earn income from the company racks that they display in their outlets. These racks contain the products of the particular company and the in turn pays Apna /azar for displaying these racks. ..g. 8aggie" Colgate" (epsodent" Dicks" &escafe etc. >H They provide space to companies e.g. 8.(' G.lectronic goodsH in order to display and sell their goods by charging rent for space provided. 2H They have >E %ranchise outlets" which act as a source of income for Apna /azar as Apna /azar supplies E3: of goods.

4H (rovide place to banks for opening AT8 center by charging rent since almost all the outlets are owned by Apna bazar. <H 8et'ife ndia signed an agreement with Apna /azar Cooperative for selling life insurance policies. /ased on the agreement" Apna /azar Co-operative shall become corporate agents for 8et'ife ndia and offer 8et'ife ndia products to its huge customer base. =enceforth Apna /azar will enable its customers to build financial freedom through 8etlife ndia products based on need analysis. Apna /azar will receive a commission of >4: on (remium amount.

TIE )UPS:)il ma#or =industan (etroleum Corporation 'td G=(C'H and Apna /azar Co-operative have entered into a tie-up. ts outlets are called A(&A /ACA, F=(C' speed mart. /y #oining hands" Apna /azar and =(C' aim to leverage their synergy for attracting consumers. =(C' would do it by offering more services at the petrol pumpsI while Apna /azar would gain access to the large base of customers visiting the gas stations of the oil giant. t has three )utlets in 8umbai at Chembur" Aadar and &erul.

GOVERNMENT SUPPORT:DOES THE GOVERNMENT REALLY SUPPORT APNA BA*AR,

+e all have a misconception that apna bazar being a co operative must be getting support and incentives from the government but this is not the case. Apna bazar has to fulfill all the requirements that any other departmental store has to comply with. They do not receive any ta@ benefits" concessions and subsidiaries from the government. The per unit rate of electricity applicable for apna bazar being a co-operative is same as the rate applicable to the mall.

MANAGERIAL ISSUES:0H They follow a traditional system of management which means they don?t follow modern management #argons. 1H They cannot afford to keep highly professional people like 8/As" CAs under them as they cannot give them higher pay package. >H The present employees lack management and technical knowledge.

C"#*$!(!("&:Apna bazaar faces loads of competition from big retail and departmental stores like /ig /azaar" $hoprite" Aemart" etc. The various parameters areB

0H As these stores provide goods at prices below 8,( with added benefits or schemes like buy one get one free" special +ednesday discount" e@change offer" etc. 1H /ig stores spends heavily on advertisements where as Apna /azaar spends only 0: in comparison to the big stores. >H The display is more attractive in other super markets and hypermarkets compared to Apna /azaar. /ig stores have a good ambience and are very spacious. 2H Apna /azaar serves only one purpose of shopping but its competitors serves two purposes of shopping and refreshments. 4H As big stores purchases in bulk quantities" wholesalers not only give heavy discounts and also allow them to give promotional incentives to customers which not only help in promoting the brands also the store itself. <H $tores like /ig bazaar are managed and run by highly professional people which is not the case with Apna /azaar. Also they face competition from small retailers and grocery merchants as they have a personalized touch with the customers. Also they provide information regarding various products in the markets and also give credit facilities.

HOW DO THEY TAC-LE COMPETITION,

The various methods by which they tackle competition are as underB 0H They take back the defective goods. 1H They are trying to upgrade their technology. >H They give <: discount to senior citizen to 4: discount to normal public in case of medicines.

OTHER PROBLEMS:0H n case of defective products the customer blames the retailer. =owever it is the manufacturing firm who is responsible. This is the case that took place with Apna bazar. )nce a screw was found by a customer in 9ood day biscuit. The customer thought that the Apna /azar provided them with the defective good whereas the mistake was on the company?s part. 1H Their warehouse has a leakage problem. Aue to which the goods get spoiled during rainy season. 'ast year they suffered a loss of 13 lakhs due to this. The insurance company gave the claim only up to 02-04 lakhs. >H There is a problem of theft. Aue to lack of technology like CCTD cameras a lot of thefts take place. Therefore supervision on each and every customer becomes difficult.

SWOT ANALYSIS:STRENGTHS

0. (ure quality commodity and $urety of no duplication The products of Apna /azaar are genuine as they purchase it directly from the companies. 'ots of imitations of consumables such as honey" oil" etc. are available in many stores. (eople get cheated" as it is not easy to identify the duplicate product. 1. Juantity is accurate and All prices below 8,( including medical products Apna /azaar makes use of modern technology to maintain correct supplier bills and giving accurate bills to customers giving details of each purchase and most importantly showing him the savings he has made while purchasing from Apna /azaar. They also possess total details of their sales and the percentage of sales in each category so they know where the sales are high and where they are lagging behind. >. 9uarantee on each product 2.$trong network as compared to competitors Apna /azaar organizes a customer meet for their regular customers called 8.'ADAA at their anniversary to build stronger relations with their customers. )n this day" the customers are offered purchase discounts which show that they have taken corrective steps towards customer satisfaction.

WEA-NESSES 0. Ambience not satisfactory

1. Congested Glack of spaceH >. 8anual management of inventory 2. 'ack of parking space 4. &o up gradation of technology.

OPPORTUNITIES 0. Tie ups with Amul" (arle" =(C'" 8etlife etc. 1. )pening stores e@ceeding 43333Ksq fts" equipped with air conditioners" trolleys etc. >. scope of e@pansion by upgrading technology.

THREATS A-8art and 9iant =ypermarkets provides the e@perience of shopping which apna /azaar does not provide. Ma..' There are a large number of malls that offer discounts the discounts offered by them are as good as those offered by Apna /azaar because the malls purchase in bulk and can hence afford to give heavy discounts to the customers. The customer has an e@plosion of choices and will prefer shopping at these big malls because of the ambience. They get the complete shopping e@perience at malls. =ence" malls are a ma#or threat for Apna /azaar.

Fu!u%$ *+,& :Apna /azaar has 7< outlets" of which 2< are company owned and the rest are franchisees. The network includes seven department stores" si@ supermarkets" 1< food stores and five speciality chemist stores. They are now planning improvement on whatever they presently run. They are more in to consolidation than e@pansion" and to form strategic alliances. They are going to have patnership with with the Lapanese Consumer Co-operative *nion GLCC*H in areas of training the staff force" visual merchandising and setting up a co-operative food brand. The company is also foraying into co-branding e@ercises to offer value to its consumers. *pgrading the skills of the manpower" creating vehicle parking facility are also in the agenda. They are focusing on the new generation customers" and talks are on with (lanet8" ,(9 9roup etc. there may be tie-up with Citibank on co-branding. Credit caed facilities will be introduced. As visual merchandising" a new way for presenting the products will be introduced. ncreasing the distribution reach is a strategy to counter competition the co-operative plans to increase its outlets. The ma#or thing on Apna /azaar?s plans is to work on all ><4 days like other big players. MEASURES TA-EN TO ERADICATE LOSSES $ince Apna /azar has incurred losses of ,s. 043 lacs in the financial year 133>-32" they have taken the following steps to eradicate these lossesB 0H They are trying to reduce the inventory turnover to two days with the help of ,adha -rishna %ood land. These would reduce

the blockage of capital and interest on it. 1H Apna /azar has discontinued the outlets" which are making losses for many years. )utlet in /andra was closed. >H Training and Aevelopment of staff in order to improve their efficiency and productivity.

CONCLUSION:Apna bazar is successful because they provide valuable services and save consumers money. $ince the primary goal of cooperatives is to meet needs" not generate profits" they can serve their members at low cost. Apna bazar often provides services to their communities that are not readily available from for-profit businesses. n other cases" cooperatives enhance the level of competition in the marketplace by providing consumers with an alternative source of products and services. t plays a vital role from the distribution of consumer goods" particularly essential consumer goods at fair prices to rural areas" including remote" inaccessible and hilly terrains. +hen it comes to food it has to be Apna /azaar that must come into one's mind. will say the punch line for Apna /azaar will

be - when you think about genuine products" think about Apna /azaar.

BIBLIOGRAPHY:(ro#ect information provided by MR. ANAND VELING

(Chairman of APNA BAZAR Dadar branch.)

MANAGEMENT OF CO-OPERATIVES
PROJECT ON APNA BAZAR

(,)%. C. 8. $. -*TTM