RETAIL INDUSTRY ANALYSIS (BIG BAZAAR)

Presentation ByLagnajit Ayaskant Sahoo Somya Ranjan Pattanayak Priyanka Raj Sana
t Rout
Plan of Presentation
Industry Analysis
Industry size Key Players Key Drivers of change(PESTEL, Diamond Analysis) Opport
unity and Threat
Organization Analysis Company details Stake Holder Analysis Value System Resourc
e Analysis Competitive Strategy Conclusion
Industry Size
India s top retailers are largely lifestyle, clothing and apparel stores This is
followed by grocery stores Following the past trends and business models in the
west retail giants such as Pantaloon, Shoppers Stop and Lifestyle are likely to
target metros and small cities almost doubling their current number of stores T
hese Walmart wannabes have the economy of scale to be low medium cost retailers
pocketing narrow margin
Key Players
Pantaloon Retail (India) Limited with over 12 million sq ft of retail spa
ad over 1,000 stores across 71 cities in India. Tata Trent limited Retail sector
activity: Apparel, books and music Current store formats: Hypermarket, supermar
kets Future plans: New venture called RPG Enterprises Stores: 250 stores, includ
ing 36 large format stores across 66 cities in India Retail sector activity: Mus
ic, food and grocery, beauty products Landmark Group Apparel, home décor and fur
nishing, Current outlets: 15 Lifestyle stores and eight Home Centers Madura garm
ents 82 store in India across 50 cities and five international stores Retail sec
tor activity: Apparel Vishal Mega mart 180 showrooms in 100 cities, Retail area
coverage of 2,990,146 sq ft Bata 1,250 outlets in India Provogue Ltd. Apparel an
d footwear, 124 own stores and 228 outlets in 64 cities Archies Ltd. Archies has
100 company-owned stores in India and 450 franchise-run outlets
PEST ANALYSIS
POLOTICAL Government is stable Government policy towards investment is liberal(4
9%) Labor law Restriction for MNC s ECONOMICAL Economy is growing(7.2%) Recovery
from recession Monetary policy
CONTD .
Socio-cultural According to mckinsey report Indian consumer goods market is expe
cted to reach $400 bl. By 2010 TECHNOLOGY Rapid expansion of IT sector New trend
s are coming
Key drivers of change
Multiple drivers leading to a consumption boom: Favorable demographics Growth in
income Increasing population of women Raising aspirations : Value added goods s
ales Food and apparel retailing key drivers of growth Organized retailing in Ind
ia has been largely an urban phenomenon with affluent classes and growing number
of double-income households. More successful in cities in the south and west of
India. Reasons range from differences in consumer buying behavior to cost of re
al estate and taxation laws. Rural markets emerging as a huge opportunity for re
tailers reflected in the share of the rural market across most categories of con
sumption IT is a tool that has been used by retailers ranging from Amazon.com to
eBay to radically change buying behavior across the globe.
Opportunities and threats
OPPORTUNITIES
THREATS

Retail industry in INDIA accounting 10% of the country s GDP. Successive Indian
government have steadily Liberalize policies related to investment, banking, tra
ding etc. URBANISATION caused more concentration of middle income and high incom
e people. Hypermarket is emerging as the most favorable format for the time bein
g in India Increasing workforce of women Falling real estate prices Increase in
disposable income and customer aspiration Increase in expenditure for luxury ite
ms Low share of organized retailing

Automatic approval is not allowed for foreign investment in retail. Regulations

restricting real estate purchases, and cumbersome local laws. Taxation, which fa
vours small retail businesses. Absence of developed supply chain and integrated
IT management. Lack of trained work force. Low skill level for retailing managem
ent. Lack of Retailing Courses and study options Intrinsic complexity of retaili
ng rapid price changes, constant threat of product obsolescence and low margins.
About Big Bazaar Out let Parent group Owner Founded Head quarter Industry websit
e Tag line Vision
Hyper mart Chain of development store in India 120 out lets Located in India Fut
ure group Kishore Biyani (CEO) 2001 Jogeswari , Mumbai Retail www.bigbazar.com I
s se sasta aur achha kahin nahi. Everything ,Everywhere, Every time for every In
dian consumer in the most profitable manner
Main Market/ Non Market stakeholders
Stakeholders & Big Bazaar
Market Stakeholders The stockholders The Big Bazaar Executive The Employees The
Communities where Big Bazaars located Consumers Suppliers Non profit Organizatio
n Competitors
Contributions
Big Bazaar
Inducements
Contributions
Inducements
Non Market Stakeholders The Labor Unions The International Retail Stores The Pol
iticians
Value System BIG BAZAAR
IN HOUSE BRANDS @ BIG BAZAAR
DJ & C KORYO FRESH & PURE SARAPOLO CLEAN MATE STAR SITARA RENUKA and SENSEI CARE
MATE MAJITHIA
40 more brands
FEW BRANDS @ BIG BAZAAR
Porter s five force model
Analysis
5 Forces
Rivalry among the competitor
Analysis
Reliance Retail, Aditya Birla Group , Vishal Retail¶s, Bharti and Walmart, etc
FDI policy not favorable for international players. Economies of scale (minimum s
ize requirements for profitable operations) High initial investments and fixed co
sts Cost advantages of existing players due to experience curve effects of operat
ion with fully depreciated assets Scarcity of important resources, e.g. qualified
expert staff
Threat of entrants
Bargaining power of supplier
The bargaining power of suppliers varies depending upon the target segment. The un
organised sector has a dominant position. There are few players who have a sligh
t edge over others on account of being established players and enjoying brand di
stinction. Consumers are price sensitive.. Availability of more choice. Unorganize
d retail
Bargaining power of buyers
Threat of substitutes
Resource Analysis
Human Resource  Well Trained Staff  Appearance  Empowered Individual  Encouraged To
Think Out Of The Box  Employ close to 10,000 people and recruit nearly 500 additi
onal people every month  Use Scenario Planning as a tool for Quick Decision Makin
g  Security Gaurds At All Gates
Financial data
CORE COMPETENCY Big Bazaar Core-Competency of OF BIG BAZAR
A choice of more than 20000 products Delivery across more than 1500 cities cover
ing around 16000 pin codes A dedicated customer care helpline for any queries Fa
st delivery-tie up with world leader logistic & transportation services Talks of
Quality and Cost Special emphasis on apparels and life style products Providing
interesting discounts
Strength - High Brand Equity - State-of-art infrastructure - EDLP - PoP promotio
ns - Variety of stuff under single roof -MIS
Weakness
- Unable to meet store opening targets - Falling revenue/sq. ft. - General perce
ption
Opportunity
Organized retail (4.15%) Evolving consumer preferences In Store Experience Impro
vements New formats and consumption space Looking at expansion
Threat
- Competitors - Government policies - Unorganized retail -Economic condition
Customer Segmentation
 Big Bazaar targets higher and upper middle class customers.  The large and growin
g young working population is a preferred customer segment.  Big Bazaar specifica
lly targets working women and home makers who are the primary decision makers.
Big Bazaar At BCG Matrix
M A R K E T H I G H
G R L O O W W T H
High Market Share
Low
Organization value and customer value
*High organization value *Low customer value
Big Bazaar *High organization value *High customer value
*Low organization value *Low customer value
*Low organization value *Low customer value
Strategy
 Focus on Rural customer? 73% of population live in 6,00000 villages out of Total
population 114 billion. Minimum support price. NREGS -100 days employment. Inco
me from farm products is Tax free.
 Customer oriented  Employee oriented- high attrition rate
Thank You
References

www.bigbazaar.com It Happened in India- Kishore Biyani www.ibef.org www.google.c

o.in www.economictimes.com futurebazaar.com