Project on Study of Consumer Services Provided By Retailers

to the Customers

Introduction
Retail consists of the sale of goods or merchandise from a fixed location, such as a
department store, boutique or kiosk, or by mail, 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.
Global retail giants such as Wal-Mart, Tesco, Germany's Metro AG and many others are
ready to enter the retail markets. The rising demand of branded products and increase in
purchasing power has lured these companies to enter the market The Apple Store retail
location on the Magnificent Mile in Chicago.

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Companys in Retail Sector

Spencers Retail
Spencer's Retail Limited is one of India's largest and fastest growing multi-format retailer
with 220 stores, including 30 large format stores across 35 cities in India. Spencer's focuses
on verticals like fresh fruit and vegetables, food and grocery, personal care, garments and
fashion accessories, home and office essentials, electrical and electronics. Established in
1996, Spencer's has become a popular destination for shoppers in India with hypermarkets
and convenient stores catering to various shopping needs of its large consumer base.
Operations
Spencer's has retail footage of approximately 1 million square feet and over 220 Spencer's
stores in 35 cities. The company operates through the following formats:

The Spencer's Hyper stores are destination stores, of more than 15,000 sq. ft in size.
They offer everything under one roof. The merchandise ranges from fruits &
vegetables, processed foods, groceries, meat, chicken, fish, bakery, chilled and frozen
foods, garments and fashion accessories, consumer electronics & electrical products,
home decor and needs, office stationeries, soft toys. On an average, a Spencer's hyper
stocks 70,000 SKUs across 35,000 items.

The Spencer's stores are neighborhood stores ranging from 1500 less than 15000 sq.
ft. These stores stock the necessary range and assortment in fruit and vegetables,
FMCG food and non-food, staples and frozen foods and cater to the daily and weekly
top-up shopping needs of the consumer.

Pantaloon Retail (India) Limited,

It is a large Indian retailer, which is part of the Future Group, and operates multiple retail
formats in both the value and lifestyle segment of the Indian consumer market.
Headquartered in Mumbai, the company has over 1,000 stores across 71 cities in India and
employs over 30,000 people

[1]

, and as of 2010, it was the country's largest listed retailer by

market capitalization and revenue.

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With effect from 1 January 2010 the company separated its discount store business, which
includes the Big Bazaar hypermarket and the Food Bazaar supermarket businesses, into
Future Value Retail Ltd., its wholly-owned subsidiary, so that the company may be listed
independently [2][3].
The companys brands include Pantaloons, a chain of fashion outlets, Big Bazaar, a
hypermarket chain and Food Bazaar, a supermarket chain. Some of the company's other
regional brands include, Depot, Shoe Factory, Brand Factory, Blue Sky, all, Top 10 and Star
and Sitara.
A subsidiary company, Home Solutions Retail (India) Limited, operates Home Town, a largeformat home solutions store, Collection i, selling home furniture products and E-Zone
focused on catering to the consumer electronics segment.
Lines of Business
The company is present across several lines of business which have various formats (stores)
plywood, The Dollar Store (JV)

Fashion - Pantaloons, Central, aLL, Brand Factory, Blue Sky, Top 10, Fashion Station,
Big Bazaar, Lee Cooper (JV)

General Merchandise - Big Bazaar, Shoe Factory, Navras, Electronics Bazaar,

Furniture Bazaar, KB'S FAIR PRICE

Electronics - eZone, Electronic Bazzaar, STAPLES (JV)

Home Improvement - Home Town

Furniture - Collection i, Furniture Bazaar, Home Bazaar

E-tailing (Online Shopping) - www.futurebazaar.com

Books & Music - Depot

Leisure & Entertainment - Bowling Co., F123

Wellness - Star & Sitara, Tulsi

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Telecom & IT - Gen M, M Bazaar, M-Port, ConvergeM, Future Axiom

Consumer Durables - Koryo, Sensei, IPAQ

Service - E Care, H Care , Design & Service

Malls - Central (Bangalore, Hyderabad, Pune, Mumbai, Vadodara, Gurgaon, Indore,

Ahmedabad)

Investment & Savings - Insurance: ULIP, Pension, Endowment etc.

Stock Information

Listed on: Bombay Stock Exchange

Stock Code: BOM:523574

Company Timeline

1987 Company incorporated as Manz Wear Private Limited. Launch of Pantaloons

trouser, Indias first formal trouser brand.

1992 Initial public offer (IPO) was made in the month of May.

1997 Pantaloons Indias family store launched in Kolkata.

2001 Big Bazaar, Is se sasta aur accha kahi nahin - Indias first hypermarket chain
launched.

2002 Food Bazaar, the supermarket chain is launched.

2007 Future Group crosses $1 billion turnover mark

Importance and scope of retailing

While there is a lot of debate going on the impact of organized retailing on unorganized
sector, there is little we know of how it will impact our economy in general. Common sense
says that perhaps it will help the economy (every better looking thing is good for the
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economy. Swanky Call centers that brought outsourcing to us helped in fueling the feel good
factor.. Same is for IT/BT companies.So similar should be the case with these retailers)
Surprisingly there are not enough reasons to contest this belief. No matter what communists
say or Mayawati does in UP, or what short term glitches we witness on Sensex or in
US economy, organized retailing is here to stay and grow at a breathtaking place.
So when it is so, I tried to look at it form a holistic point of view and no matter how much I
desist to say this but yeah, I ultimately ended up with a PEST analysis.Here are the main
points from that(I might post the complete version sometime later but before that I myself
want to refine this and include the reaction that I get..if any :))

Political
Even though the government is yet to give the sector an Industry status and we see aggressive
political protests, some aspects of the Governments policy have been favourable on other
fronts. For example- lets take Delhi, NCR and Mumbai. In Mumbai, the Government is
releasing unused textile mill land for retail development. In Delhi & NCR, the Government
has released large tracts of land for retail development. Overall in politics, those in opposition
will always oppose..so is there any point in talking about this?
Anyway main points to look out for are :
1. Decision on FDI
2. Governments stand for foreign players
Economical
Although the organized retail sector constitutes only 4-5% of the USD 350 billion Indian
retail market, it is expected to grow 400%- from USD 12-15 billion currently, to over USD
30.0 billion by 2010. There is hectic activity in the sector in terms of expansion, entry of
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international brands and retailers as well as focus on technology, operations and processes.
All these present a tremendous opportunity in this new high growth industry. A large portion
related to economic impact has
already been covered in the
previous sectionsThe important
thing is that the growth of this
sector will create a totally new
demand

in

our

economy.

Households across India are now

exposed to products and services
they had never seen before, the
tempting value proposition and
an inviting atmosphere is making
them

purchase

these

items.

Without the new stores the same

money would have been sitting idle in some bank lockers. But now the money is out in
market, helping the manufacturers to come out with new and innovative products. A great
aggregation is also taking place now.. you can go and buy as much low quantities that you
want, and the systems assist you in this because no one is bothered.
Social
There has been a demographic shift in India, emergence of a larger middle and upper middle
classes and the substantial increase in disposable income has changed the nature of shopping
in India from need based to lifestyle dictated. In addition to this, facilities like credit
friendliness, availability of cheap finance and a drop in interest rates have changed consumer
markets.Organized retail increases the efficiencies in the agriculture sector by removing
intermediaries in the food chain; as a result, farmers are getting better prices for their
produce. The private retail players can actually introduce new technology, seeds, and thus
encourage farmers to improve their productivity.Unorganized retail is feeling the heat of the
emergence of the organized retail due to the changing trends of the Indian consumers.
Antagonist lobby claims, In the last four years, an estimated two crore traders have been
rendered jobless due to the opening of big shopping malls in the country. However there is
no evidence of a decline in overall employment in the unorganized sector as a result of the
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entry of organized retailers. According to the ICRIER survey, the unorganized sector
witnessed a closure rate of 4.2% of which only 1.7% closures were attributed to competition
from modern retail.Large retailers like
Technological
With increasing competition, slimmer profit margins and diminished returns-cost cutting at
every point of value chain has become important. Todays global retail business strategies
utilize technology. Ecommerce, Customer Relationship Management (CRM) software,
Enterprise Resource Planning (ERP) and Point of Sale (POS) systems are all vital to retail
businesses. Using these technologies retailers can actually gain key insights to further gain
market share and increase revenue Indian retailer would feel the need for technology only
when he wants to grow beyond a certain point. This is one of the reasons why the traditional
grocery is here to stay, with 90% of sales in India done through them

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Types of retail outlets

A market place is a location where goods and services are exchanged. The traditional market
square is a city square where traders set up stalls and buyers browse the merchandise. This
kind of market is very old, and countless such markets are still in operation around the whole
world.
In some parts of the world, the retail business is still dominated by small family-run stores,
but this market is increasingly being taken over by large retail chains
Retail is usually classified by type of products as follows:

Food products

Hard goods ("hard line retailers") - appliances, electronics, furniture, sporting goods,
etc.

Soft goods - clothing, apparel, and other fabrics.

There are the following types of retailers by marketing strategy:

Department stores - very large stores offering a huge assortment of "soft" and "hard
goods; often bear a resemblance to a collection of specialty stores. A retailer of such
store carries variety of categories and has broad assortment at average price. They
offer considerable customer service.

Discount stores - tend to offer a wide array of products and services, but they compete
mainly on price offers extensive assortment of merchandise at affordable and cut-rate
prices. Normally retailers sell less fashion-oriented brands. However the service is
inadequate.;

General merchandise store - a hybrid between a department store and discount store;

Supermarkets - sell mostly food products;

Warehouse stores - warehouses that offer low-cost, often high-quantity goods piled on
pallets or steel shelves; warehouse clubs charge a membership fee;
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Variety stores or "dollar stores" - these offer extremely low-cost goods, with limited
selection

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 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, students, or senior citizen
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
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in the late 19th and early 20th centuries. 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.

Customer service
When a customer enters the store, it is important that the sales associate does everything in
his power to make the customer feel welcomed, important, and make sure he leave the store
satisfied. Giving the customer full, undivided attention and helping him find what he is
looking for will contribute to the customer's satisfaction.

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Retail
scene in India
With organized retail in India pegged at Rs 25,000 crore (Rs 250 billion) -- out of a total of
Rs 800,000 crore (Rs 8,000 billion -- and a double digit growth rate, marketing companies are
setting up shops to provide differentiated services to clients. Till now sales people were the
link between the retailer and the producer. But sales personnel are busy selling a product and
do not have a fair idea of what retailing is about. The focus is to priorities retail. That is, not
only to sell a product to a consumer but to get the consumer to interact with the product.
Gone are the days when retailing meant mere availability of a product. With competition
becoming stiffer companies are looking at 'experiential' marketing. Also the lack of proper
metrics to measure marketing spends is a serious issue.
In today's swiftly changing business environment, there is no option but to be in the know - to
be constantly on the move, keeping tabs on the shifting trends in the market place and
maneuvering your strategy to stay on top. The retail arena today is very different - the
opportunities are incredible but exploiting them is extremely tough.
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Super smart shoppers know all the rules of the game. They can instantly sense a good buy
and lap it up or sniff out a bad product and dismiss it. Their expectations are tough to meet
but for retailers aiming to make a big sale, there is not much of a choice but to find ways to
win customers over and keep them permanently happy.
In an environment, which is still restrictive in many ways and lacks adequate infrastructure,
this becomes a formidable task. So how are Indian retailers coping up and how long will it be
before organised retail becomes the primary way of selling.

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Current Status of Retail Marketing in India
Winds of change sweeping through Retail Industry.
What is it that has made the Piramals, the Tatas, the Rahejas, ITC and scores of others take a
plunge into mega retailing? Why is market research, space management, ERP, promotions etc
now a necessary tool in this industry?
Retail Economics in India
Traditionally retailing has not been a structurally organized industry in India. Organized retail
network was seen only in fabrics, with large mills building their own exclusive stores e.g.
Raymond's, Bombay Dyeing etc.
Currently there are about 5130000 retail outlets selling about Rs4790bn worth of products.
Retail universe in India comprises large, medium general stores, chemists and pan-bidi (apart
from accessories stores). Of these thanks to unemployment, the number of pan-bidi outlets
are steadily rising. On account of the fragmented nature of Indian retail industry the
inhabitants to stores ratio in India is about 150:1, i.e. there is a store catering to every 150
people. This ratio varies from country to country. In china the ratio is similar to that of India
where as incase of more developed countries the ratio would be higher. For instance in
Europe the inhabitant to stores ratio is 2000:1.As markets mature, consumer expectations
rise it would be a necessity for small retailers to come together and form innovative and
strong supply chain that will cut through distribution and increase margins.

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LITERATURE REVIEW
Mathew Joseph and Manisha Gupta_September 2008: The Indian retail sector is booming
and modernizing rapidly in line with Indias economic growth. In this review the author
talked about the impact of organized retailing on traditional retailing. With the increase in
number of various formats for shopping like malls, departmental stores, hypermarkets etc the
Indian consumers preferences are changing towards and thats the reason foreign investors
like the king of retail Wal-Mart also came into the Indian retail ground in collaboration with
Bharti. There is a huge untapped market is present in India right now which contains a
number of opportunities for retailers.

Sen-2000: Store Image and Consumer Shopping Habits: Indian Context: In India, some
empirical studies provide important information about consumer behavior and its responses
to the development of organized retail. Economical and social changes are major contributors
for a growing fragmentation of consumers into multiple segments with different values and
buying priorities. Consumers have become more pragmatic, educated and demanding,
learning how to manage money and time more efficiently. The focus on low prices was
gradually replaced by a value for money perspective. The study developed by ETIG
(Economic Times Intelligence Group, 2002) confirms these tendencies. Concerning food, the
most important attribute mentioned was quality, followed by price. Indian consumer has
different reasons for preferring different store formats, either modern or traditional; Sen
(2000) confirms this in the study undertaken in Indian context. He confirms that in the case of
hypermarkets, the main motives for preferences, in decreasing order are low prices, the
possibility of buying everything in the same place and the general appearance of the store.
Several investigations emphasize the possible coexistence of different store formats
(Chandrasekhar, 2001) and others point out the relationship between the type of store and the
type of products. These studies show that, while specialized and traditional stores are
preferred for fresh products, hypermarkets are preferred for shopping in general, and also for
frozen food, groceries and beverages. The purchase of perishables in hypermarkets is
reduced.

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Radhakrishnan, 2003: Traditional Retailers Perceptions about Organized Retail

As already mentioned, organized retail has deeply changed the Indian commercial structure.
However, it is not exclusively responsible, as other changes (economical, social and cultural
ones) have occurred simultaneously. Concerning the more direct effects of organized retail on
different types of commerce, it is possible to verify that the major impact is felt on traditional
retail and, in particular, on the food sector. The impact of organized retail is also significant
on other types of retail, namely toys, stationery goods and household appliances; moreover, it
is probable that competition gets more intense in other sectors, such as clothing and furniture.
RNCOS (March 15, 2009/24-7 press releases): Increasing trend of organized retailing will
drive the growth of convenience-store industry in the world. By 2011, Asia remains the
fastest growing convenience store market in the world as the major Asian retail markets
registered explosive growth in opening up of new convenience store. Changing consumer
preferences, lifestyle and rising income level, which is heavily influenced by economic
growth, remains the major driving force for c-store industry in the Asian region. as per
"Global Convenience Store Market Analysis".

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Data Analysis
Q1) Are you aware about the organized Retail Outlets in Ulhasnagar?

Yes

No

Retail Outlets

40%
Yes
60%

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No

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Q2) Which organized FMCG Retail outlets are you aware about ?

Subhiksha
6Ten
Spencers

Reliance Fresh
Vishal Mega Mart

Novelty
Santosh Kriyana

FMGC Retail

12%

Subhiksha

14%

Relaiance Fresh
Novely
18%
29%

6Ten
Vishal Mega
Santosh Kriyana

9%

18%

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Q3) Out of these which you have visited?

Subhiksha
6Ten
Spencers

Reliance Fresh
Vishal Mega Mart

Novlety
Santosh Kriyana

FMGC Retail

12%

Subhiksha

14%

Relaiance Fresh
Novely
18%
29%

6Ten
Vishal Mega
Santosh Kriyana

9%

18%

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Q4) Out of these organized FMCG Retail Outlets where do you generally purchase from ?

Subhiksha
6Ten
Spencers

Reliance Fresh
Vishal Mega Mart

Novlety
Santosh Kriyana

FMGC Retail

12%

Subhiksha

14%

Relaiance Fresh
Novely
18%

29%

6Ten
Vishal Mega
Santosh Kriyana

9%

18%

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Q5) Where were you shopping before buying from these organized FMCG Retail Outlets

Neighborhood Karyana Store

Store which is convenient to you

Wholesale Mkt.

Any Other

Buying FMGC Goods

10%
Neighborhood
15%

Wholesale Market
Convinent Store
Any Other

15%

60%

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Q6) Whats your average one time purchase at FMCG Retail Outlets in Rupees ?

Below 1000

1,000-1500

1,500-2000

2,000-2500

Purchase of Retail Otles

10%
Below 1000

15%
50%

1000/1500
1500/2000
2000/2500

25%

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Q7) What are your reasons for purchasing from these organized FMCG Retail Outlets ?
(mark only 3)

Better Quality

Reasonable price Product range

Good environment
Time Saving
Discounts and Promotional schemes

Display of products

Reason for Purchasing From Retail Outles

13%

19%

Better Quality
Reasonable Price
19%

Product Range
Good Environemtn

19%
13%
19%

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Time Saving
Display of Produts

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Q8) Do you think by shopping at organized FMCG Retail Outlets your monthly
expenditure:

Reduced

Remain Same

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Increased

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Shopping of FMGC

Reduced
40%

45%

Remain Same
Increased

15%

Q9 ) Are you satisfied with the quality of goods offered by the organized FMCG Retail
Outlets ?
Highly Satisfied Satisfied

Neutral

Dissatisfied

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Highly Dissatisfied

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Satsificaiton fom services

15%
10%

Highly Satisfied
50%

Satisfied
Netural
Highly Disatisifed

25%

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Q10) Are you satisfied with the range offered by organized FMCG Retail Outlets from
where you purchase ?
Highly Satisfied

Satisfied

Neutral

Dissatisfied

Highly Dissatisfied

Satsificaiton fom services

15%
10%

Highly Satisfied
50%

Satisfied
Netural
Highly Disatisifed

25%

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Q11) What do you think the service provided by these organized FMCG outlets in
comparison to other stores are:
Excellent

Good

Average

Poor

Very Poor

Satsificaiton fom services

10%
15%

Excellent
40%

Good
Average

10%

Por
Very Poor

25%

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Q12) Do you think the market share of unorganized retail will:

Definitely increase Increase

Remain same

Decrease

Definitely decrease

Unorganized

Definitely Increas

15%

Increase

30%

Remain Same
15%

Decrease
Definetaly Decrease

20%

20%

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Conclusion
The customers are attracting towards shopping malls & retail outlets.

The shopping malls & retail outlets are targeting to middle class customers because
the purchasing power of this class is rapidly growing as well as the class is also
growing.

The young generation is fashion & show-off conscious so retail outlets are mainly
focused on them.

Most of the family wants to purchase from big showrooms and malls because there
are no bargaining system so the have a trust that there is no cheating.
The main strength of most of the retail outlets are providing attractive offers to attract
customers.

Big retail stores are running customer loyalty programs which has increased profits
and no. of customers.

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Bibliography
BOOKS:Marketing Management. ----Kotler & Keller
Marketing Management in Indian Perspective
----V. S. Ramaswamy & S. Namakumari
Retail management ---Levy & Weitzs
WEBSITES:www.emraldinsight/1355-5855.htm
www.Fibre2fashion.com/industry-article
www.tataretail.com
www.retailindia.net
www.retailyatra.com
www.retailbiz.com
www.aboutus.com
www.businessworld.in

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Annexure
Q1) Are you aware about the organized Retail Outlets in Ulhasnagar?
Yes

No

2) Which organized FMCG Retail outlets are you aware about ?

Subhiksha

Reliance Fresh

Novelty

6Ten

Vishal Mega Mart

Santosh Kriyana

Spencers

3) Out of these which you have visited?

Subhiksha
6Ten

Reliance Fresh
Vishal Mega Mart

Novlety
Santosh Kriyana

Spencers
Q4) Out of these organized FMCG Retail Outlets where do you generally purchase from ?
Subhiksha

Reliance Fresh

Novlety

6Ten

Vishal Mega Mart

Santosh Kriyana

Spencers
Q5) Where were you shopping before buying from these organized FMCG Retail Outlets
Neighborhood Karyana Store

Wholesale Mkt.

Store which is convenient to you

Any Other
Q6) Whats your average one time purchase at FMCG Retail Outlets in Rupees ?
Below 1000

1,000-1500

1,500-2000

2,000-2500

Q7) What are your reasons for purchasing from these organized FMCG Retail Outlets ?
(mark only 3)
Better Quality

Reasonable price

Product range

Good environment

Time Saving

Display of products

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Discounts and Promotional schemes

Q8) Do you think by shopping at organized FMCG Retail Outlets your monthly
expenditure:
Reduced

Remain Same

Increased

Q9 ) Are you satisfied with the quality of goods offered by the organized FMCG Retail
Outlets ?
Highly Satisfied Satisfied

Neutral

Dissatisfied

Highly Dissatisfied

Q10) Are you satisfied with the range offered by organized FMCG Retail Outlets from
where you purchase ?
Highly Satisfied

Satisfied

Neutral

Dissatisfied

Highly Dissatisfied

Q11) What do you think the service provided by these organized FMCG outlets in
comparison to other stores are:
Excellent

Good

Average

Poor

Very Poor

Q12) Do you think the market share of unorganized retail will:

Definitely increase Increase

Remain same

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Decrease

Definitely decrease