WINTER INTERNSHIP Visual Merchandising in PANTALOONS

In the partial fulfilment for the award of Graduate Program (BBA) in Marketing Management

PLACE OF RESEARCH:

GURGAON

Submittedby: Md Shahbaz Khan BBAL2S2 (08-11)

SkylineBusiness School NewDelhi

ACKNOWLEDGEMENT:

I take this opportunity to thank the management of Pantaloons Ltd. Forallowing me to be associated with the organization and Hence exposing me to itsunique culture which has helped immensely in enriching our knowledge and gaining a valuable insight into the practical aspects of VisualMerchandising.

Last but notleast I also extent my heartiest thanks to the customers of Gurgaon who spenttheir precious time in filling our analysis.

I also express my gratitude to SBS, New Delhi for providing me an opportunity to work on this thesis as a partof the curriculum.

MdShahbaz Khan

2ndyear undergraduate student

BBA(Marketing) msk_hotrock@yahoo.co.in Departmentof Management Studies SBSNew Delhi.

PREFACE:

I am Md Shahbaz Khan doing BBA (Marketing) 2nd year undergraduatestudent of Department of ManagementStudies, SBS New Delhi has undergone trainingprogram in Pantaloon Retail India Limited (PRIL) an arm of Future Group. I havebeen assigned a task as a project related to Visual Merchandising. The project title is Visual Merchandising inpantaloons Gurgaon.

I feel great and pleasure in presenting this researchproject which is essential in partial fulfillment of our management program.Research Project is an integral part of curriculum and its purpose is toprovide the student with practical exposure of market in todays changingscenario. It helps in development of practical scales and analytical thinkingprocess. It also makes students aware of about the perception and taste ofconsumers. Thus it helps in molding the students according to the requirementof the market.

After globalization there has been a vast change inIndian retail market. Global players have entered the fray which has forced theIndian retailers to change there strategies and culture. There is cut throatcompetition and have realized the value of customers. Consumers buyingpreferences, taste, choice has changed and have become more quality conscious.It leads to boom in consumer market and people were on the spending speed.

So in such a competitive retail market where everyretailer is trying to capture maximum no. of consumer market. So this researchproject studies the current situation of Visual Merchandiser level prevailingin Indian retail industry and how does it impact retail outlets. And throughthe survey taken with the Customers we can understand the

psyche of Indianconsumers and very well analysis that what they want and desire .This surveyhelps Retailers to satisfy the customers and delighting them with such uniquegoods which other competitors cannot think of.

COMPANYS PROFILE

Pantaloon Retail (India) Limited, is Indias leadingretailer that operates multiple retail formats in both the value and lifestylesegment of the Indian consumer marker. Headquartered in Mumbai (Bombay),the company operates over 5 million square feet of retail space, has over 450stores across 40 cities in Indiaand employs over 18,000 people.

The companys leading formats include Pantaloons, achain of fashion outlets, Big Bazaar, auniquely Indian hypermarket chain, Food Bazaar, a supermarket chain, blends thelook, touch and feel of Indian bazaars with aspects of modern retail likechoice, convenience and quality and Central, a chain of seamless destinationmalls. Some of its other formats include, Depot, Shoe Factory, Brand Factory,Blue Sky, Fashion Station, all, Top 10, mBazaar and Star and Sitara. Thecompany also operates an online portal, futurebazaar.com.

A subsidiary company, Home Solutions Retail (India)Limited, operates Home Town, a large-format home solutions store, Collection i,selling home furniture products and E-Zone focussed on caterings to theconsumer electronics segment.

Pantaloon Retail was recently awarded theInternational Retailer of the Year 2007 by the US-based National RetailFederation (NRF) and the Emerging Market Retailer of the Year 2007 at the WorldRetail Congress held in Barcelona. Pantaloon Retail is the flagship company ofFuture Group, a business group catering to the entire Indian consumption space.

FUTURE GROUP:

Future Group is Indias leading business group thatcaters to the entire Indian consumption space. Led by Mr. Kishore Biyani, theFuture Group operates through six verticals: Retail, Capital, Brands, Space,Media and Logistics.

Apart from Pantaloon Retail, the groups presencein the retail space is complemented by group companies, Indus League Clothing,which owns leading apparel brands like Indigo Nation, Scullers and Urban Yoga,and Galaxy Entertainment Limited that operates Bowling Co, Sports Bar, F123 andBrew Bar.

The groups joint venture partners include Frenchretailer ETAM group, US-based stationary products retailer, Staples andUK-based Lee Cooper. Group Company, Planet Retail, owns and operates thefranchisee of international brands like Marks & Spencer, Next, Debenhams andGuess in India.The groups Indian joint venture partners include, Manipal Healthcare,Talwalkars, Blue Foods and Liberty Shoes.

Future Capital Holdings, the groups financial arm,focuses on asset management and consumer credit. It manages assets worth over$1 billion that are being invested in developing retail real estate andconsumerrelated brands and hotels. The group has launched a consumer creditand financial supermarket format, Future Money and soon plans to offerinsurance products through a joint venture with Italian insurance major,Generalise.

The group is currently developing over 50 malls andconsumption centres across the country and has formed a joint venture companyfocusing on mall management with Singapore-based Capital and, one of Asias largest property companies.

Future Groups vision is to, deliver Everything,Everywhere, Every time to Every Indian Consumer in the most profitable manner.The group considers Indian-ness as a core value and its corporate credo is -Rewrite rules, Retain values.

Future the word which signifies optimism, growth, achievement,strength, beauty, rewards and perfection. Future encourages us toexplore areas yet unexplored, write rules yet unwritten; create newopportunities and new successes. To strive for a glorious future brings to usour strength, our ability to learn, unlearn and re-learn, our ability toevolve.

We, in FutureGroup, will not wait for the Future to unfold itself but create futurescenarios in the consumer space and facilitate consumption because consumptionis development. Thereby, we will effect socio-economic development for ourcustomers, employees, shareholders, associates and partners.

Our customerswill not just get what they need, but also get them where, how and when theyneed.

We will not justpost satisfactory results, we will write success stories.

We will not justoperate efficiently in the Indian economy, we will evolve it.

We will not justspot trends; we will set trends by marrying our understanding of the Indianconsumer to their needs of tomorrow.

It is thisunderstanding that has helped us succeed. And it is this that will help ussucceed in the Future. We shall keep relearning. And in this process, do justone thing.

Rewrite Rules. Retain Values.

Group Vision

Future Groupshall deliver Everything, Everywhere, Everytime for Every Indian Consumer inthe most profitable manner.

Group Mission

We share thevision and belief that our customers and stakeholders shall be served only bycreating and executing future scenarios in the consumption space leading toeconomic development.

We will be thetrendsetters in evolving delivery formats, creating retail realty, makingconsumption affordable for all customer segments for classes and for masses.

We shall infuseIndian brands with confidence and renewed ambition.

We shall beefficient, cost- conscious and committed to quality in whatever we do.

We shall ensurethat our positive attitude, sincerity, humility and united determination shallbe the driving force to make us successful.

Core Values

Indianness: confidence inourselves.

Leadership: to be a leader, bothin thought and business.

Respect & Humility: to respectevery individual and be humble in our conduct.

Introspection: leading topurposeful thinking.

Openness: to be open and receptiveto new ideas, knowledge and information.

Valuing and NurturingRelationships: to build long term relationships.

Simplicity & Positivity:Simplicity and positivity in our thought, business and action.

Adaptability: to be flexible andadaptable, to meet challenges.

Flow: to respect and understandthe universal laws of nature.

Pantaloon is not just an organisation it is an institution, acentre of learning & development. I believe thatknowledge is the only weapon at our disposal and our quest for it is focused,systematic and unwavering.

At Pantaloon, wetake pride in challenging conventions and thinking out of the box, intravelling on the road less travelled. Our corporate doctrine Rewrite Rules,Retain Values is derived from this spirit.

Over the years,the company has accelerated growth through its ability to lead change. A numberof its pioneering concepts have now emerged as industry standards. Forinstance, the company integrated backwards into garment manufacturing even asit expanded its retail presence at the front end, well before any other Indianretail company attempted this. It was the first to introduce the concept of theretail departmental store for the entire family through Pantaloons in 1997. Thecompany was the first to launch a hypermarket in India with Big Bazaar, a largediscount store that it commissioned in Kolkata in October 2001. And the companyintroduced the country to the Food Bazaar, a unique 'bazaar' within ahypermarket, which was launched in July 2002 in Mumbai. Embracing ourleadership value, the company launched aLL in July 2005 in Mumbai, making usthe first retailer in Indiato open a fashion store for plus size men and women.

Today we are thefastest growing retail company in India. The number of stores isgoing to increase many folds year on year along with the new formats coming up.

The way it worksis distinctly "Pantaloon". It courages to dream and to turn ourdreams into reality that change peoples lives, is our biggest advantage.Pantaloon is an invitation to join a place where there are no boundaries towhat you can achieve. It means never having to stop asking questions; it meansnever having to stop raising the bar. It is an opportunity to take risks, andit is this passion that makes our dreams a reality.

Come enter a world where it promises you good daysand bad days, but never a dull moment!

MANAGEMENT HIERARCHY IN THE RETAIL OUTLET

Team Leader Department Manager

Asst. Store Manager Asst. Department Manager Team member Team member Trainee

Themanagement follows a Saturday meeting to boast up the moral of employees anddevelop strategies to gain targets. This also helps them to solve theconfronting problems and get the feedbacks as well. These meetings arecompulsory for every one and the discipline is quite well to be maintained.Various encouragement programs are also performed to gain motivation towardsefficiency and perfection.

Partner Companies:

Indus League Clothing Ltd.

The group owns amajority stake in Indus League Clothing Ltd., one of the leading apparelmanufacturers and marketers in India.Some of its leading brands include Indigo Nation, Scullers, Urbana, Urban Yoga and Jealous 21.

Home Solutions Retail (India) Ltd.

Home SolutionsRetail (India)Ltd. (HSRIL) leads the groups foray in the home improvement and consumerelectronics retailing segment. It caters to home management requirements andproducts, including furnishings and textiles, furniture, consumer electronics,home electronics and home services. It operates retail formats like Home Town,Furniture Bazaar, Collection I, E-Zone, Electronics Bazaar and Got It.

Future Capital Holdings

Future Capitalis the financial arm of the group and is involved in asset management (bothprivate equity and real estate funds) with plans to get into other financialservices including insurance, credit and other consumer related financialservices. Its associate companies are Kshitij Investment Advisory Co. Ltd.,Indivision Investment Advisers Ltd., and Ambit Investment Advisory Co. Ltd.

Future Media India Ltd.

Future MediaIndia Ltd. is a part of the Future Group, aimed at creation of media propertiesin the ambience of consumption and thus offer active engagement to brands andconsumers.

Future Bazaar India Ltd.

Future BazaarIndia Ltd. is a subsidiary of Pantaloon Retail (India) Limited. It owns andoperates the online shopping portal futurebazaar.com

Galaxy Entertainment Corporate Ltd.

The group owns astake in Galaxy Entertainment Corporate Ltd. that operates chains like BowlingCompany, Sports Bar and Brew Bar.

Joint Ventures Companies:

CapitaLand Retail India The group is ajoint venture partner in CapitaLand Retail India, along with Singapore-basedCapital and Limited. The company provides retail management services to retailproperties owned or managed by various group companies and investment funds.

Footmark Retail

Foot mart Retailis a joint venture with Liberty Shoes and is engaged in the retailing offootwear products in India.

Planet Retail Holdings Ltd.

The group is ajoint venture partner in Planet Retail Holdings Ltd., which operates sports,lifestyle and leisure retail chain. It also owns the franchisee anddistribution rights of brands like Marks & Spencer, Guess, Debenhams andPuma in India.

Maincompetitors

GLOBUS

The Mumbai-basedRajan Raheja Group launched its first Globus department store in January 1998at Indore and since then it has become a 20-outlet strong chain with a presencein 14 cities. Apart from the Globus department stores, the chain also runs asecond retail format with Globus 2, the factory outlet format. Globus' flagshipstore was launched in Mumbai in November 2001. The department store chain'scustomer loyalty programme is called the Globus Privilege Club card programme.In 2004, the chain had seven outlets in five cities with a total space of1,39,658 sq.ft by 2005 their retail presence had reached eight cities with 12stores and a total retail space of 1,94,610 sq.ft. Today the chain runs 20outlets in 14 cities with a total retail space of 2,90,000 sq.ft. Retailexpansion plans include having 30 outlets by 2007, 100 by 2008, and taking itto 120 by 2010 with a total retail space of 12,40,000 sq.ft. The chain'sinstore labels apparel labels, Globus and F21, contribute about 35 per centtowards total retail sales. Frequent consumer promotions during peak salesperiods like traditional festive seasons bring in 25-30 per cent increase inaverage sales.

LIFESTYLE

The Dubai-basedLandmark Groups department store chain, Lifestyle, started operations in Indiain 1998. It currently operates 19 Lifestyle departmental stores in nine citieswith a total retail space of 7,45,711 sq. ft. In 2004 the chain had sevenstores in five cities with a space of 2,68,436 sq.ft, which grew to 10 storesin the same five cities with an increased retail space of 3,41 ,587 sq.ft. By2010 they plan to have 41 stores in 16 cities with a combined retail space of19,33,931 sq.ft. The average store size of a Lifestyle department store is46,000 sq.ft, the largest of them being the Chennai store with an area of75,000 sq.ft. Lifestyle now plans to majorly expand into the tier-II cities inthe country. Ginger, Baby Doll and JRS Active are the three major privatelabels of Lifestyle, besides segment-specific brands like 2xtremz for

women andJuniors for infants. These private labels contribute approximately towards 10per cent to the total revenue. Its customer loyalty programme is called TheInner Circle, which contributes 40 per cent to total sales. Each of the storeshas a Coffee Island managed by Qwiky's. Lifestyle International has announcedinvestments to the tune of Rs.400 crore in the next five years to fund itsexpansion in India. This includes plans to bring in its concept stores into thecountry, including the Max Hypermarkets and Lifestyle Centres. The Max chainsof value stores and Home Centres have already been launched. Landmark is alsoworking on a Lifestyle Centre.

SHOPPERS'STOP

Shopper's StopLtd from the K Raheja Group, opened its first Shoppers' Stop department storein Mumbai in 1991; and over the last 16 years has established itself as thelargest player in the department store category in India. From 16 stores innine cities with an area of7,52,848 sq.ft, the chain today operates 26 outletsin 12 cities with a total retail space of 15,07,126 sq.ft, with plans to have34 stores by 2007. By 2010 Shoppers' Stop plans to have nearly 50 outlets in 20cities across a total retail space of 36,26,899 sq.ft. Shoppers' Stop was thefirst retailer in the country to have Bar-coded garments, Co-branded creditcard; and Retail ERP Shoppers' Stop, unlike Pantaloon and Westside where thechunk of sales are driven by private labels, houses a large number of externalbrands. The chain is today the largest retailer for popular brands like Levi'sStrauss, Pepe, Arrow, Zodiac, Ray-Ban, Swatch, ete. The launch of Buzz (thedesigner pret wear section) and Kasba by Raghavendra Rathore were some newadditions. Some of the chain's private labels include Stop, Life, VettorioFratini, Haute Curry, indi-vidual and Acropolis, sales from which grew by 44per cent in 2005, over the previous year. Shoppers' Stop customer loyaltyprogramme, First Citizen's Club has approximately 4,40,000 members, whocontribute to over 50 per cent of the total sales. Shoppers' Stop, which hastied up with Mothercare, the global brand for infants and children, will beopening 40 Mothercare outlets over the next five years. It currently has morethan 11 Mothercare outlets. The bookstore section, Crossword; as well as foodand beverages outlets such as Cafe

Westside,

The lifestylestore by the Tatas that caters to the upper middle class segment, has built its customerbase through its USP of affordable style. There are 23 Westside stores in 14cities Price is crucial in the Indian retail scenario and Westsides focus onthis factor is part of the reason. If customers are looking for style, theywill probably go to Westside and buy something for Rs 400 rather than go toMango (a UK-based chain). Another issue is convenience of parking space. Almosteveryone in major metros has a car and doesnt want to go through the hassle offinding parking space. Westside has worked on moulding its outlets along thesnazzy, well-designed, hands-on ambiences and coffee shop displays typical ofLacoste, Nike and Switch retail stores in the West, and personalized itsofferings by offering style and accessory guides to its customers. Westsidehouses a collection of the finest merchandise for the entire family. There arespacious shopping areas for the various sections - womens wear, mens wear andthe children's and the household sections occupy the floor level. Caf Westfrom the Taj group on a level above is an ideal place for a coffee break on a shoppingspree. Westside offers customers the very best and latest internationalshopping experience. Westside has a team of dedicated stylists, merchandisers,helpful and courteous store staff and talented in-house designers. Thecombination of the very latest in-style fashion with affordability ishighlighted in all of Westsides merchandise. Westside stands out from thecompetition for a variety of reasons. One is that a majority of the brands thechain stocks and sells are

its own, unlike retailers who store multiple labels.About 90 per cent of Westsides offerings are homegrown, and they cater todifferent customer segments. The other 10 per cent includes toys, cosmetics andlingerie. However, recently Westside has recently expanded its range of merchandiseby offering outfits from some of Indias best-known fashion designers, amongthem Wendell Rodericks, Anita Dongre, Krishna Mehta and Mona Pali. This is aninteresting marketing shift, since it means moving away from the chainsonly-our-own-brands concept.

CompetitiveStrengths

The following are the key strengths of PRIL:

Brand Equity and earlymover advantage PRIL is of Indiasleading retailers with presence across multiple formats and stores across largeand medium cities across India.The Company successfully introduced the hypermarket format through Big Bazaar,introduced the concept of seamless malls through Central, launched FashionStation to offer fashion apparel and accessories to mass market buyers in atheme based style, opened aLL an exclusive lifestyle store for plus size peopleand continue to invest in new concepts and formats to capture a greater shareof the consumer wallet, either directly and through our strategic investments.

Entrepreneur led,professionally managed by an experienced team PRIL has an experienced professional management team led by our PromoterMr. Kishore Biyani, who is one of the leading entrepreneurs in the retailsector in the country and has received various awards over the years, with therecent one being the Retail Face of the Year, 2005 (Images Retail Awards 2005). The management team is complemented by a committed work force. The HumanResources policies aim to create an engaged and motivated work force, which isessential for success in any service oriented industry

Vast range of lifestyleand value retail products and services The companys merchandise ranges across apparel, accessories withPresence in both Lifestyle and Value retailing enables us the organization tocater to a large segment of the population. The company offers the customers avariety of national and international brands as well as our Private Labelbrands under one roof.

Strong distribution andlogistics network and supply chain, Large base of loyal customers etc

Target market and Positioning of Pantaloons

Pantaloons is positioned as adepartment store catering to the middle and upper-middle class sections at eachof its locations. Its core offering is branded merchandise, retailinginternational, national and regional brands as well as private and proprietarylabels. Today, a leader inFashion...Pantaloons promises Fresh Fashion for the entire family as well asthe young and the young-at-heart. The belief is that they will be the keydrivers of fashion. The resemblance can be clearly felt by the introduction of Fashion Fridays which brings in a themeto continue with the growing fashion across the World. Thus it is a storefocusing on providing a value for money proposition as it provides qualityfashion products at an affordable price as compared to the competitors inrespect to the glamorous looks and change in the world of bollywood. Pricing

High turnover Low turnover High Margin Low Margin

Since Pantaloons provides products to apotentially large number of customers at affordable prices, it falls in theHigh Turnover - Low Margin Category.

VISUAL MERCHANDISING

Visual Merchandising In modern retail, Ibelieve that visual merchandising is key to encourage a customer to purchasethe products. Visual merchandising involves store window, store directories,inposters, unit top poster / visual, placement of products, highlightingproducts in the store. The use of visual merchandising skills is to present themerchandise at its best, in order to appeal to the

customer. This is criticalin store activity with the visual merchandising team deciding on the theme aswell as the manner in which the merchandise is proposed to be displayed acrossthe stores nation wide.

CONCEPT OF VISUAL MERCHANDISING

It is the activityof promoting the sale of goods, especially by their presentation in retail outlets.This includes combining product, environment, and space into a stimulating andengaging display to encourage the sale of a product or service. Visualmerchandising is the art of implementing effective design ideas to increasestore traffic and sales volume.

Objectives

A desire to attract customers to a place of business in order to sell themerchandise. It is offered to the customer through interior and exterior presentation. It helps create positive customer image. It helps to increase sales. It encourages impulse buying