SUBMITTED TO SHRI GANPATI INSTITUTE OF TECHNOLOGY GHAZIABAD

MASTER IN BUSINESS ADMINISTRATION

(MBA)(2006-08)
SUBMITTED TO SUBMITTED BY
ALOK KUMAR YADAV
M BA IVth Sem.
PREFACE
As an essential and obligatory part o my !o"rse. #his resear!h report helped me in
getting the pra!ti!al $no%ledge o the b"siness en&ironment.
D"ring my resear!h I got pra!ti!al $no%ledge abo"t strategies. And ho% to %or$ is
!arried o"t into in !ompany in this report I ha&e mentioned the !"stomer
satisa!tion in retail ind"stry.
Learning is a pro!ess' %hi!h !ontin"es thro"gh o"t the lie. Basi!ally pro(e!t %or$
is the best %ay to pra!ti!e %hat %e ha&e learnt. A pro(e!t is a s!ientii! and
systemati! st"dy o real iss"e or a problem intended to resol&e the problem %ith
appli!ations o management $no%ledge and s$ills into the appli!ation to sol&e
%hate&er problem !omes in the organi)ation.
An organi)ation is a h"man gro"ping in %hi!h %or$ is done or the
a!!omplishment o some spe!ii! goal' or mission. All the a!ti&ities o any
enterprises are initiated and determined by the person %ho ma$e "p that instit"te'
plant' oi!e' !omp"ter' a"tomated e*"ipment. and all else that ma$e a modern irm
"ses are "nprod"!ti&e e+pert or h"man eort and dire!tion o all the tas$ o
management' managing the h"man !omponent is the !entral and most important
tas$' be!a"se all else depend on ho% %ell it is done.
ACKNOWLEDGEMENT
I ta$e this opport"nity to e+press o"r proo"nd sense o gratit"de and respe!t to all
those %ho helped "s thro"gho"t the d"ration o this pro(e!t. ,irstly' I am e+tremely
grate"l to my !ollege' Shree -anpati Instit"te o #e!hnology or pro&iding "s the
e+!ellent %or$ing en&ironment to "ndergo o"r pro(e!t.
I de&ote my s"!!ess in this eort to my pro(e!t g"ide Dr.C.K. Tiwari and
Mrs.Deepa Singh & Mr. Tajender Singh or gi&ing me the opport"nity to
"nderta$e the pro(e!t and pro&iding !r"!ial eedba!$s that inl"en!ed and pro&ided
opport"nity to "nderta$e the pro(e!t %or$ in the esteemed !on!ern. .itho"t their
able g"idan!e' I %o"ld not ha&e been able to !omplete my %or$ s"!!ess"lly as
they pro&ided help or !orre!ting the pro(e!t se!tion o&er and o&er "ntil %e inally
got them a!!omplished ei!iently.
I am highly than$"l to Pr!!. A.K.Singh "dire#$r% ! SG&T or pro&iding me this
golden opport"nity to "ndergo.
Last' b"t not the least' I %o"ld li$e to e+tend o"r proo"nd than$s to all o"r
esteemed !olleag"es and riends at !ollege le&el %ho helped "s in the spe!ii! areas
o this pro(e!t.
DA#/0 S'&(ANG (ATS
M.B.A. IV
th
S/M
E)e#*$i+e S*,,ar-
Doing this pro(e!t' it %as a great e+perien!e or me. #he pro(e!t is
intended to pro&ide inormation abo"t 1"stomer satisa!tion le&el %ith
the Shopping Malls .In India there ha&e been a great s"!!ess"l brand
both national as %ell as oreign brands and again it has been reali)e
that brands are s"staining po%er to stay in the !ompetitions.
Being a !apital 2 biggest b"siness !enter o India I !hoose the
-ha)iabad to !ond"!t my st"dy and to get lot o e+pos"re 2 &ario"s
opport"nities to meet dierent $ind o Retailers and their
Representati&es. Many o them did not sho% any interest and re"sed
at !ooperate on its plea3 as to %hy sho"ld they part %ith !lassiied
inormation. #his pro(e!t has been "nder ta$en to st"dy o !"stomer
per!eption abo"t shopping malls and s"ggesting %ay to impro&e it4s
mar$et share in sales thro"gh !"stomer per!eption abo"t pri&ate
labels.
#o !ond"!t the detail st"dy o my Resear!h' I gathered the inormation
rom !"stomers at shopping malls regarding the &ario"s a!tor
ee!ting sale o shopping malls. Ater getting the inormation' I
analyses the inormation and try to ind o"t the reason and it4s best
sol"tion.
In the last b"t not least some re!ommendation are gi&en as %ell as
some limitations are a!!"sed %hi!h had to a!e d"ring the st"dy o the
Resear!h.
&NDE.
PREFACE
ACKNOWLEDGEMENT
E.EC/T&(E S/MMAR0
1. &NTROD/CT&ON
2. RE(&EW OF L&TERAT/RE
3. RETA&L REAL&T&ES
4. GROWT' DR&(ER
5. GLO6AL SCENAR&O
7. E(OL/T&ON OF &ND&AN RETA&L
8. O69ECT&(ES
:. RESEARC' MET'ODOLOG0
;. F&ND&NG
1<.CONCL/S&ON
11.S/GGEST&ON
12.6&6L&OGRAP'0
O(ER&EW OF TOP&C
#he pro(e!t is intended to pro&ide inormation abo"t 1"stomer
satisa!tion le&el %ith the ser&i!es oered by %holesaling ind"stry .In
India there ha&e been a great s"!!ess"l brand both national as %ell as
oreign brands and again it has been reali)e that brands are s"staining
po%er to stay in the !ompetitions.
I %e deined the !"stomer satisa!tion %e !an say 5 a *"alitati&e
meas"re o perorman!e as deined by !"stomer' %hi!h meet their
basi! re*"irements and standard.6
1"stomer satisa!tion is deined as 5meas"re or determination that a
prod"!t or ser&i!e meet a !"stomer4s e+pe!tation' !onsidering
re*"irement o both *"ality and ser&i!e.6
#his pro(e!t has been "nder ta$en to st"dy !"stomer per!eption abo"t
the ser&i!es oered by %holesaling ind"stry and s"ggesting %ay to
impro&e it4s mar$et share in sales thro"gh !"stomer per!eption abo"t
pri&ate labels.
DESCR&PT&ON OF T'E CONCEPT
The Wh=esa=ing &nd*s$r-
.holesaling is the third step in the distrib"tion o mer!handise 7 the
se!ond last lin$ in the S"pply 1hain 7 !onne!ting the b"l$ prod"!ers
o !ommodities to the retailers. .holsaling !o&ers di&erse prod"!ts
s"!h as oot apparels' !ons"mer goods' inan!ial ser&i!es and leis"re.
A %holesaler' typi!ally' is someone %ho plays a signii!ant role in
deli&ering the mer!handise in b"l$ to the retailers or "rther
distrib"tion. 8e9 She is also the one %ho pro&ides the retailer %ith the
man"a!t"red goods' as and %hen re*"ired by the retailers in the
spe!iied *"antity' the retailer desires. 8en!e' the &al"e proposition a
%holesaler oers to a retailer is easy a&ailabilities o the desired
goods in the desired si)es at the desired times.
In the de&eloped !o"ntries' the %holesale ind"stry has de&eloped into a "ll7
ledged ind"stry %here more than three7o"rths o the total %holesale trade is done
by the organi)ed se!tor. 8"ge %holesale !hains li$e :antaloon' R:-' .al7Mart' K7
Mart' M!Donalds' et!. ha&e no% repla!ed the indi&id"al small stores. Large retail
ormats3 %ith high *"ality ambian!e and !o"rteo"s' and %ell7trained sales sta are
reg"lar eat"res o these retailers.
Broadly the organi)ed %holesale se!tor !an be di&ided into se&en segments'
Mer!hant %holesalers' #hese %holesale s"ppliers o%n and prod"!e a prod"!t or
ser&i!e and resell their prod"!ts to resellers' retailers' distrib"tors and other
%holesalers' Genera= Wh=esa=ers 7 .holesalers that all into this !ategory %ill
"s"ally b"y large *"antities o prod"!ts rom one or more s"ppliers and %ill be
intending to add &al"e to them by reselling in smaller *"antities to distrib"tors'
retailers and resellers' Spe#ia=i$- Wh=esa=ers 7 #his type o %holesaler %ill resell
prod"!ts in a spe!ii! ind"stry or prod"!t !ategory' b"t may ha&e prod"!ts rom
m"ltiple s"ppliers' Spe#i!i# Prd*#$ Wh=esa=ers 7 #hese are %holesalers %ho
only s"pply ; type o prod"!t or e+ample oot%ear or !omp"ters. #hey may
s"pply se&eral brands b"t only %ithin one prod"!t !ategory' Dis#*n$
Wh=esa=ers < #his type o %holesaler %ill s"pply signii!antly dis!o"nted sto!$.
-enerally the sto!$ is dis!o"nted be!a"se the prod"!ts are dis!ontin"ed lines'
ret"rned goods or re"rbished goods' Drp Ship Wh=esa=ers 7 #his type o
%holesaler %ill !omplete the sale o a prod"!t b"t %ill ha&e it dispat!hed rom
their s"pplier dire!tly to their !"stomer %itho"t a!t"ally handling the goods' On>
=ine Wh=esa=er 7 .holesalers %ho sell their prod"!ts on7line oer dis!o"nted
pri!es as they !an red"!e their o&erheads s"!h as rent and rates o physi!al
premises.
.holesale mar$ets de&elop in a n"mber o o stages. #hey start as general mar$ets'
then be!ome more spe!iali)ed by trading in a limited range o prod"!e. A later
stage is to deal %ith samples o prod"!e and inally to transa!t only graded
prod"!e. A re!ent trend in .estern /"rope and the USA is to by7pass the %holesale
mar$et system. Dire!t lin$s are !reated bet%een prod"!ers and s"permar$et !hains'
"s"ally by means o !ontra!t arming arrangements.
/&ery organi)ed %holesaler in India is a!ed %ith myriad *"estions0
dierentiating %ith the other !ompetiti&e ormats3 s"staining the
dierentiation %ith "p!oming me7too ormats3 !oping %ith lo!al7
neighborhood %holesalers.
A possible sol"tion to all these are oered by %holesalers.
Very e% ne% %holesale mar$ets ha&e been !reated in de&eloped
!o"ntries in the last de!ade'altho"gh old mar$ets ha&e been relo!ated
to ne% sites. It %o"ld be &ery !on&enient i a standard model or
%holesale mar$et de&elopment %as a&ailable or "se in less7de&eloped
!o"ntries. #his is generally possible i yo" loo$ at other spe!iali)ed
!ontemporary b"ilding types' s"!h as international air passenger or
!argo terminals' medi!al operating theatres' ind"strial laboratories or
%areho"ses "sing me!hani!al handling e*"ipment. Altho"gh the design
approa!h %ill depend on the !limate o a parti!"lar region' the spa!e
standards "sed or designing s"!h b"ilding types %ill generally be the
same %hether the a!ility is in Alas$a or 1al!"tta. #he o&erall
organi)ation %ill be broadly similar and so %ill be the le&el o
sophisti!ation o e*"ipment. #he "se o modern management
te!hni*"es %ill also be broadly appli!able' irrespe!ti&e o the lo!ation.
Altho"gh dieren!es may e+ist' say bet%een London and Rome'
modern %holesale mar$ets in de&eloped !o"ntries ha&e m"!h in
!ommon. In terms o layo"t and !ir!"lation they are similar to
hypermar$ets or to large7s!ale distrib"tion %areho"ses. #hey need to
handle ei!iently the inp"t and o"tp"t o large &ol"mes o prod"!e
and to pro&ide a!ilities or the sale o that prod"!e. So %hy are
%holesale mar$ets in less7de&eloped !o"ntries dierent= #he
distin!tion is largely that neither the inp"ts into nor o"tp"ts rom the
mar$et' in terms o the types o prod"!e' ho% it is transported and its
*"ality and *"antity !an be standardi)ed in the manner that is possible
in a de&eloped !o"ntry. #his has a signii!ant impa!t on both the
planning o the mar$et site and on the design o its b"ildings.
MA9OR FORMAT OF RETA&L
MAJOR FORMATS OF IN-STORE RETAILING HAVE BEEN LISTED IN
TABLE GIVEN BELOW:
Format Description The Value
Proposition
Branded
Stores
/+!l"si&e sho%rooms either
o%ned or ran!hised o"t by
a man"a!t"rer.
1omplete range
a&ailable or a gi&en
brand' 1ertiied
prod"!t *"ality.
Spe!ialty
Stores
,o!"s on a spe!ii!
!ons"mer need' !arry most
o the brands a&ailable.
-reater !hoi!e to the
!ons"mer'
!omparison bet%een
brands possible
Department
Stores
Large stores ha&ing a %ide
&ariety o prod"!ts'
organi)ed into dierent
departments' s"!h as
!lothing' ho"se %ares'
"rnit"re' applian!es' toys'
et!.
One stop shop
!atering to &aried
!ons"mer needs.
S"permar$ets /+tremely large sel7
ser&i!es retail o"tlets.
One stop shop
!atering to &aried
!ons"mer needs.
Dis!o"nt
Stores
Stores oering dis!o"nts on
the retail pri!e thro"gh
Lo% pri!es.
selling high &ol"mes and
reaping the e!onomies o
s!ale.
8yper7mart

Larger than a S"permar$et'
sometimes %ith a %areho"se
appearan!e' generally
lo!ated in *"ieter parts o
the !ity
Lo% pri!es' &ast
!hoi!e a&ailable
in!l"ding ser&i!es as
!aeterias.
1on&enien!e
Stores
Small sel7ser&i!e ormats
lo!ated in !ro%ded "rban
areas.
1on&enient lo!ation
and e+tended
operating ho"rs.
Shopping
Malls
An en!los"re ha&ing
dierent ormats o in7store
retailers' all "nder one roo.
Variety o shops
a&ailable !lose to
ea!h other.
Re$ai=ing !r,a$s in &ndia
Some o the pre&alent relating ormats in India in!l"de 0
Ma==s
Most malls gi&e loor spa!e o"t to indi&id"al shops on lease' and these
are enti!ed by the e!onomies res"lting rom the sharing o !osts.
India> s largest shopping ar!ade Spen!ar :la)a ?@AA'AAA7s*7tB in
1hennai is an e+ample. In malls li$e these' the !ombined brand p"ll o
all o"tlets is "sed to !reate a p"ll or the mall.
6randed S$res
/+!l"si&e sho%rooms r"n by premi"m brands ha&e been the !atalysts
in p"shing "p the Indian retail s!enario. #his !on!ept is no% being
"sed to introd"!e organi)ed retailing to the se!ond r"ng to%ns.
Mad"ra -arments has started setting "p e+!l"si&e o"tlets in !ities li$e
#ri!hy and #han(a&"r.
,ood 2 -ro!eries is the largest item o !ons"mption in the Indian
1ons"mer4s pri&ate !ons"mption e+pendit"re' a!!o"nting or almost
CAD o his share o %allet. And yet it has a min"s!"le share o A.ED in
organi)ed retailing. #he $irana or the general stores is the most
!ommon o"tlet or ood prod"!ts in India' tho"gh other ormats li$e
s"permar$ets also e+ist. #he ood b"siness is &ery lo% margin b"t high
sto!$7t"rn b"siness model
and ei!ient so"r!ing !apabilities and logisti! management is the $ey
to s"!!ess in this segment. #he ma(or players in this segment are Apna
Ba)aar' 1anteen stores' ,ood .orld' S"bhi$sha and ,ood Ba)aar.
Apparel Retailing is the !o"ntry4s se!ond largest opport"nity or the
organi)ed retailers. #he !lothing mar$et is highly ragmented' %ith
n"mero"s players operating a!ross a %ide &ariety o ormats. Branded
apparel a!!o"nts or only FAD o the total apparel mar$et. Men4s
!lothing !"rrently a!!o"nts or GAD o all branded apparel sales as
!ompared to FFD o !hildren4s %ear and HD o %omen4s %ear. #he
str"!t"re o apparel retail has !hanged dramati!ally in the re!ent past
%ith the gro%th o large m"lti7brand apparel o"tlets and man"a!t"rer
brand7led !hains. Li$e in the %est' spe!ialty stores that ha&e beg"n to
grab mar$et share in India.
1ons"mer D"rable segment is the most organi)ed retail segment in the
!o"ntry. Most o the !orporates in this segment ha&e a net%or$ o
e+!l"si&e stores ?man"a!t"rer7 retailerB %hi!h is operated on either
o%ned or ran!hise model. #here is a parallel net%or$ o a"thori)ed
dealers that !o7e+ists in this segment. More re!ently' single large
stores ha&e !ome "p a!ross the !o"ntry li$e 1hennai4s Spen!er4s or
Sony Mony or S"maria in M"mbai.
S*per,ar?e$s@'-per,ar?e$sA #hese are large ?FA'AAA s*"are eet
pl"sB sel7ser&i!e stores selling a &ariety o prod"!ts at dis!o"nted
pri!es. S"permar$ets tend to be lo!ated in $ey residential mar$ets and
malls' and oer !ompetiti&e pri!es d"e to e!onomies o s!ale in
logisti!s and p"r!hasing. #his ormat is ne% to India %ith e%
noti!eable players s"!h as ,ood%orld' Iilgiri4s and S"bhi$sha.
Depar$,en$a= s$resA #hese large stores primarily retail non7ood
items s"!h as apparel' oot%ear and ho"sehold prod"!ts. #hey sto!$
m"ltiple brands a!ross prod"!t !ategories' tho"gh some o them o!"s
on their o%n store labels ?e.g.' Mar$s 2 Spen!er4s' St. Mi!haelB.
Se&eral lo!al department store !hains ha&e opened shop in India in the
past C years ?e.g.' Shoppers Stop' .estside and /bonyB.
Spe#ia=$- #hainsA #hese retail o"tlets o!"s on a parti!"lar brand or
prod"!t !ategory' "s"ally non7ood items' and are lo!ated on high
streets and in shopping malls. .hile most spe!ialty !hains !ompete on
ser&i!e' a segment !alled 5!ategory $illers6 oers pri!e as an
ad&antage ?#oys JR4 Us is a good e+ample o a !ategory $illerB. #his
ormat has seen the highest le&els o adoption in India' %ith se&eral
!hains establishing a strong presen!e' typi!ally thro"gh ran!hising'
e.g.' Benetton' Arro%' et!. 1hains s"!h as the Bangalore based Kids
Kemp' the M"mbai boo$s retailer 1ross%ord' R:-> s M"si! .orld and
the #imes -ro"p> s m"si! !hain :lanet M' are o!"sing on spe!ii!
mar$et segments and ha&e established themsel&es strongly in their
se!tors.
/rBan #*n$er s$resA #hese small amily7r"n stores dominate ood
and non7ood retailing and are o"nd in both residential and
!ommer!ial mar$ets in to%ns and !ities.
#he ood stores sto!$ a %ide range o branded and "nbranded ood
items. #hey typi!ally ha&e a loyal !lientele bo"nd to them by personal
relationships and the !on&enien!e o !redit and home deli&ery.
&ND&A &S T'E 6EST 6ET FOR RETA&L C'A&NS
India represents the most important !ompelling international in&estment
opport"nity or mass mer!hants and ood retailers loo$ing to e+pand o&erseas'
a!!ording to management !ons"ltan!y irm A# Kerney.
Retailers that missed the opport"nity to !apt"re the irst mo&er ad&antage in !hina'
it said' !o"ld ma$e "p or it in India.
#he irst !hallenge a!ing the organi)ed retail ind"stry in India is0
!ompetition rom the "norgani)ed se!tor. #raditional retailing has
established in India or some !ent"ries. It is a lo% !ost str"!t"re' mostly
o%ner7operated' has negligible real estate and labor !osts and little or no
ta+es to pay. 1ons"mer amiliarity that r"ns rom generation to generation is
one big ad&antage or the traditional retailing se!tor.
:layers in the organi)ed se!tor ha&e big e+penses to meet' and yet ha&e to
$eep pri!es lo% eno"gh to be able to !ompete %ith the traditional se!tor.
8igh !osts or the organi)ed se!tor arises rom0 higher labor !osts' so!ial
se!"rity to employees' high *"ality real estate' m"!h bigger premises'
!omort a!ilities s"!h as air7!onditioning' ba!$7"p po%er s"pply' ta+es et!.
Organi)ed retailing also has to !ope %ith the middle !lass psy!hology that
the bigger and brighter a sales o"tlet is' the more e+pensi&e it %ill be.
Retail ind"stry is one o the most attra!ti&e se!tors or ,DI ?oreign dire!t
in&estmentB in India and oreign retail !hains %o"ld ma$e an impa!t in
FAAE.
Retailing in India is thoro"ghly "norgani)ed. #here is no s"pply !hain
management perspe!ti&e. An o&er%helming proportion o the Rs. KAA'AAA
!rore retail mar$et is UIOR-AIIS/D. In a!t' only a Rs. FA'AAA !rore
segment o the mar$et is organi)ed.
Liestyles in India are !hanging and the !on!ept o L&al"e or moneyL is
pi!$ing "p.
Lo!al !ompanies and lo!al7oreign (oint &ent"res are e+pe!ted to more
ad&antageo"sly positioned than the p"rely oreign ones in the organised
India>s retailing ind"stry.
-i&en the si)e' and the geographi!al' !"lt"ral and so!io7e!onomi! di&ersity
o India' there is no role model or Indian s"ppliers and retailers to adapt or
e+pand in the Indian !onte+t.
,rom a si)e o only Rs.FA'AAA !rore' the OR-AIIS/D retail ind"stry %ill
gro% to Rs. ;@A'AAA !rore by FAAC. #he #O#AL retail mar$et' ho%e&er' as
indi!ated abo&e %ill gro% FA per !ent ann"ally rom Rs. KAA'AAA !rore in
FAAA to Rs. HAA'AAA !rore by FAAC.
A lot o shoppers are only ("st getting "sed to &isiting s"permar$ets and
hypermar$ets reg"larly or their gro!eries' and :ri&ate Label is still a
relati&ely ne% !on!ept or them.
Re$ai= Rea=i$ies
Unorgani)ed mar$et0 Rs. CHE AAA !rore
MOrgani)ed mar$et0 Rs. CAAA !rore ?in!l"des organi)ed ,ood and -ro!ery Rs.
@AA
!roreB
CN gro%th in organised retailing bet%een FAAA7FAAC
O&er K'AAA ne% modern retail o"tlets in the last E years
O&er C'AAA'AAA s*. t. o mall spa!e "nder de&elopment
#he #op E modern retailers !ontrol o&er GCA'AAA s*. t. o retail spa!e
MO&er KAA'AAA shoppers %al$ thro"gh their doors e&ery %ee$
-ro%th in organi)ed retail on par %ith e+pe!tations and pro(e!tions o the
last C years0 on !o"rse to to"!h Rs. EC'AAA !rores ?USO G BillionB or more by
FAAC7A@
#he Indian retail story !o"ldn>t ha&e been more dierent. India has appro+ ;F
million retail stores' more than rest o the %orld p"t together. B"t the per !apita
s*"are eet area "nder retail is ("st F s*.t or A.F s*. meters %ith ragmented
$eerana stores being the predominant players. Retailing in India has remained in
the "norgani)ed se!tor and largely "nto"!hed by !orporates.
8o%e&er' times are !hanging.. .ith the -D: at an all time high and in!ome le&els
shooting thro"gh the roo' the a&erage Indian !ons"mer has ne&er had it so good.
#he propensity to !ons"me has rea!hed pea$s that had ne&er been s!aled beore.
1redit !ards are lashed %ith disdain and shopping bas$ets are getting bigger all
the time. 8ere are some a!tors that indi!ate the potential o retail in India0
P At FG; million' one o the largest !ons"ming base in the %orld' orming FGD o
the total pop"lation
P A high spending !omm"nity belo% KC years !omprises H; per!ent o the
pop"lation
P A yo"ng pop"lation %ith CKD pop"lation belo% FC years
P In!reased litera!y rom KKD in ;Q@C to GAD in FAAE
P In!rease in %or$ing%omen rom ;.E million in ;Q@; to K.H million in ;QQH
PIn!rease in media penetration to EH7million !able ho"sehold and HA7million #V
ho"sehold in FAA;
MOD/RI #RAD/ VS #RADI#IOIAL R/#AIL
Small retailers in India ha&e inherent ad&antages. #hey are lo!ated ne+t to the
!ons"mer' ma$ing it !on&enient or top7"p p"r!hase. #hey $no% them %ell' some
e&en by name. #hey gi&e !redit too 7 %hi!h no large retailer does. #heir i+ed !osts
are so lo% that their brea$e&en point is as lo% as K@D o sales. Organised retailing
o ood and gro!eries is highest in the so"th o India. 8ere ;AD 7;CD thro"ghp"t
o leading ,M1- s"ppliers in!l"ding MI1>s s"!h as 1adb"ry' Unile&er et!.' is
sold thro"gh modern trade.
D"ring the ;QQA4s sales o store brand prod"!ts in s"permar$ets in!reased
appro+imately ;E.C per!ent o store sales to nearly ;@.A per!ent. #he n"mber o
"nits sold in!reased rom abo"t ;G per!ent o the total n"mber sold in s"permar$ets
to o&er FA per!ent d"ring this same period. D"ring the past year pri&ate brand sales
in s"permar$ets gre% more rapidly than man"a!t"rer brands. Store brands gre% at
@.E per!ent !ompared %ith a K.; per!ent or all man"a!t"rer brands.
Yet the n"mber o distrib"tors appointed by these !ompanies has a!t"ally
in!reased' indi!ating that the gro%th in mar$et demand %as healthy eno"gh to
s"stain gro%th in the n"mber o o"tlets o both modern trade and mom7and7pop
stores or at least' another FA years. It has' moreo&er' been pointed o"t that the
le&el o threat' i any' to small retailers
,rom an international retailer' %ill be the same as the one rom
a domesti! retailer.
Interestingly' the ra!e to de&elop more pri&ate labels is e&ident in a range o &aried
!ategories rom apparel' oot%ear' oods and health!are to personal !are and
liestyle prod"!ts. ,or instan!e' in mens%ear' retailers say that gross margins on
branded prod"!ts &ary rom FC per !ent to EH per !ent
It is the same %ith :antaloon>s ;E ,ood Ba)aars. A CAA gm tomato $et!h"p bottle
retails at Rs EH !ompared to 8ind"stan Le&er>s Kissan at Rs KQ.
E(OL/T&ON OF TRADE C'ANNELS
As seen' the role o the intermediary is being diminished grad"ally' %hi!h has
ob&io"s impli!ation o ba!$lash o the trade !hannel "p%ards to%ards the
s"ppliers. #his is more se&ere in !o"ntries s"!h as India' %here the !hannel
e!onomi!s in a&o"r o the middlemen ?the distrib"torsB is still strong eno"gh
gi&en the ragmentation o the retail se!tor.
#hereore %hen ,ood .orld' the largest gro!er in India has a 5dire!t s"pply6
!ontra!t %ith o&er FAD o its $ey s"ppliers' it gi&es rise to !onli!t o interest %ith
the distrib"tion inrastr"!t"re that s"ppliers ha&e painsta$ingly b"ilt o&er the years.
/&en the mom and pop stores ?$no%n as $irana shops and general storesB are
ae!ted d"e to this 5"nair6 ba!$end ad&antage e+tended by the s"pplier to its
leading a!!o"nts ?the emerging s"permar$et !hainsB. #he strategies adopted by the
retailer to !ompete %ith branded goods are ill"strated by the ollo%ing diagram.
Branding the store and ollo%ing a pri&ate label strategy is the $ey strategy %hi!h
helps the retailer to !ompete %ith branded prod"!ts.
GROWT' DR&(ER
Ke- !a#$rs $ha$ wi== dri+e grw$h ! rganiCed re$ai=ing
Rising Urbani)ation
8igher disposable in!omes
-ro%ing !ons"merism
I"!le"s amily str"!t"re
-ro%ing n"mber o ed"!ated and employed %omen pop"lation
Media prolieration and rising a%areness le&el
Brand pro"sion
The grw$h dri+ers
Increased per capita spending
#he ee!t o pop"lation in!rease %as "rther a!!ent"ated by an in!rease in per
!apita spending.
Dual income families
Ad&ent o d"al in!ome amilies also helped in the gro%th o retail se!tor. A d"al
amily !an spend more b"t has &ery little time a&ailable or shopping. #h"s'
!on&enien!e and speed o ser&i!e be!ame !r"!ial parameters.
Urbanization
In!reased "rbani)ation has led to high !"stomer density areas th"s enabling
retailers to "se lesser n"mber o stores to target the same n"mber o !"stomers.
Aggregation o demand that o!!"rs d"e to "rbani)ation helps a retailer in reaping
the e!onomies o s!ale.
Covering distances has become easier
.ith in!reased a"tomobile penetration and an o&erall impro&ement in the
transportation inrastr"!t"re' !o&ering distan!es has be!ome easier than beore.
Io% a !"stomer !an tra&el miles to rea!h a parti!"lar shop' i he9she sees &al"e in
shopping rom there.
,rom the s"pply side also' a n"mber o de&elopments "eled the gro%th o the
retail ind"stry. Retailers "nderstood the needs o the !"stomers and reali)ed
ei!ien!ies thro"gh in&estments in #e!hnology Inrastr"!t"re and /mployees. #he
o"t!omes %ere impro&ed s"pply !hains' in!reased ser&i!e le&els and satisied
!"stomers.
T'E GLO6AL RETA&L SCENAR&O
Large ormat retail b"sinesses dominate the retail lands!ape in the
United States and a!ross /"rope' in terms o retail spa!e' !ategories'
range' brands' and &ol"mes. Indian retail ind"stry !annot hope to learn
m"!h by merely loo$ing at the .estern s"!!ess stories in retail. #heir
s!ales o operations are &ery h"ge' the proit margins that they earn
are also m"!h higher and they operate in m"ltiple ormats li$e
dis!o"nt stores' %areho"ses' s"permar$ets' and departmental stores'
hypermar$ets' !on&enien!e stores and Spe!ialty stores.
#he e!onomy and liestyle o the .est is not in line %ith that o India
and hen!e the retailing s!ene in India has not e&ol&ed in the same
ormat as the .est nor !an %e learn &al"able lessons rom their style
o operations.
In retailing' the !on&entional %isdom "sed to be' that' the !riti!al
s"!!ess a!tor %as lo!ation. B"t pre!ise lo!ation no longer matters and
geo7demographi!s is in!reasingly be!oming irrele&ant. #he leading
m"ltiple !hain retailers' s"perstores and malls !reate their o%n !enters
o gra&ity' attra!ting !"stomers by !ar' b"s' train or e&en by plane to
%here&er they are lo!ated.
#he gro%th o m"ltiple !hain retailers has been relentless or many
years in the %est and this has been a!!ompanied by the de&elopment o
retail names as brands in their o%n right. Dis!o"nt retailer .al7Mart
has !atap"lted to the top o the ,ort"ne CAA ran$ings in the U.S. %ith a
t"rno&er o OFCH billions ?FAAE re&en"es < the basis or FAAK
ran$ingsB' ahead e&en o oil ma(or /++on Mobil and the mammoth
man"a!t"ring giant -eneral /le!tri!. A r"thless poli!y' o' JAl%ays
Lo% pri!es. Al%ays.4 has bro"ght .al7Mart to the top. On the day
ater #han$sgi&ing in Io&ember FAAF' .al7Mart sales hit O;.KE billion
in one single day.
Trends in Re$ai=ing
Retailing in India is at a nas!ent stage o is e&ol"tion' b"t %ithin a
small period o time !ertain trends are !learly emerging %hi!h are in
line %ith the global e+perien!es. Organi)ed retailing is %itnessing a
%a&e o players entering the ind"stry. #hese players are e+perimenting
%ith &ario"s retail ormats. Yet' Indian retailing has still not been able
to !ome "p %ith many s"!!ess"l ormats that !an be s!aled "p and
applied a!ross India. Some o the notable e+!eptions ha&e been
garment retailers li$e Mad"ra -arments 2 Raymonds %ho %as s!aled
their e+!l"si&e sho%room ormat a!ross the !o"ntry.
E)peri,en$a$in wi$h !r,a$s
Retailing in India is still e&ol&ing and the se!tor is %itnessing a series
o e+periments a!ross the !o"ntry %ith ne% ormats being tested o"t3
the old ones t%ea$ed aro"nd or ("st dis!arded. Some o these are listed
in #able belo%.
Retailer 1"rrent
,ormat
Ie% ,ormats. /+perimenting
.ith
Shoppers>
Stop
Department
Store
R"asi7mall
/bony Departmental
Store
R"asi7mall' smaller o"tlets'
adding ood retail
1ross%ord Large
boo$store
1orner shops
:yramid Department
Store
R"asi7mall' ood retail
:antaloon O%n brand
store
8ypermar$et
S"bhi$sha S"permar$et 1onsidering mo&ing to sel
ser&i!e
Vitan S"permar$et S"b"rban dis!o"nt store
,ood
%orld
,ood
s"permar$et
8ypermar$et' ,ood %orld
e+press
-lob"s Department
Store
Small ashion stores
Bombay
Ba)aar
Aggregation o Kiranas
/oodmart Aggregation o Kiranas
Metro 1ash and !arry
S K"mar> s Dis!o"nt store
Retailers are also trying o"t smaller &ersions o their stores in an
attempt to rea!h a ma+im"m n"mber o !ons"mers. 1ross%ord
boo$stores are e+perimenting %ith 1ross%ord 1orner' to in!rease
rea!h and b"siness rom their stores. ,ood .orld is e+perimenting
%ith a ormat o one7o"rth the normal si)e !alled ,ood .orld
/+press.
S$re design
Irrespe!ti&e o the ormat' the biggest !hallenge or organi)ed
retailing is to !reate an en&ironment that p"lls in people and ma$es
them spend more time shopping and also in!reases the amo"nt o
imp"lse shopping. Resear!h a!ross the %orld sho%s that the !han!es o
senses di!tating sales are as m"!h as ;A7;CD or !ertain !ategories.
#his reason is good eno"gh or organi)ed retailers to bring in
proessional designers %hile de&eloping a ne% property. And' that is
%hy retail !hains li$e M"si! .orld' Barista' :yramid and -lob"s and
laying ma(or emphasis 2 in&esting hea&ily in store design.
M"si! .orld spent three months in !ollege !amp"ses and metros
st"dying the mar$et and tal$ing to yo"ngsters beore starting %or$.
#he brand identity %as !reated ater e+tensi&e resear!h0 a logo %as
designed and the loo$ o the stores a!ross the !o"ntry %as de!ided
"pon. Apart rom the &is"al impa!t' the "n!tionality o the store
design %as also ta$en !are o. Listening posts ha&e been !reated or
people to listen to their a&orite alb"m and an area in the !enter o the
stores has been earmar$ed or !elebrity &isits and promotions.
E,ergen#e ! dis#*n$ s$res
.hat does S"bhi$sha In 1hennai' Margin ,ree in Kerala and re!ent
entrants li$e Bombay Ba)aar in M"mbai' R:-> s 7 -iant in 8yderabad'
Big Ba)aar in Kol$ata' 8yedrabad and Bangalore ha&e in !ommon=
#heir prod"!ts are belo% MR:.
Dis!o"nt stores ha&e inally arri&ed in India and they are e+pe!ted to
spearhead the re&ol"tion in organi)ation retailing. #ho"gh this
segment is gro%ing' it is small !ompared to international standards
%here aro"nd @A per !ent o the b"siness !omes rom this ormat.
Internationally' the largest retailer in the %orld .al7Mart is a
dis!o"nter. #hese dis!o"nt stores ha&e ad&antages o pri!e' assortment
dominan!e and *"ality ass"ran!e and ha&e the ability to *"i!$ly b"ild
s!ale and pass on the beneits. 8o%e&er' the s"!!ess %o"ld be or
retailers %ho are able to b"ild the s!ale ast and manage their
operations ei!iently %hile oering &al"e to the !"stomer
!onsistently.
/nrganiCed re$ai=ing is ge$$ing rganiCed
#o meet the !hallenges o organi)ed retailing that is l"ring !"stomers
a%ay rom the "norgani)ed se!tor' the "norgani)ed se!tor is getting
organi)ed. FC stores in Delhi "nder the banner o :ro&ision mart are
(oining hands to !ombine monthly b"ying. Bombay Ba)aar and
/oodmart ha&e also been ormed %hi!h are aggregations o Kiranas.
In a no&el mo&e' si+ Delhi based resta"rants ha&e !ome together and
ormed a !onsorti"m0 I,1' to promote Ie% ,riends 1olony' a posh
lo!ality in the 1apital' as a branded pla!e in to%n. #he aim is to
in!rease ootballs in the area' %hi!h is ast losing its sheen to its
!losest and "p!oming destinations s"!h as large !ineple+es' and malls'
%hi!h are ba!$ed by the !orporate ho"se s"!h as > Ansals> and > :VR> .
1o"ntry Organised
Retailing
#raditional
Retailing
Malaysia CAD CAD
#hailand CAD CAD
:hillipines ECD @CD
Indonesia FCD GCD
So"th Korea ;CD HCD
1hina ;AD QAD
India FD QHD
The &ndian Re$ai= S#ene
India is the !o"ntry ha&ing the most "norgani)ed retail mar$et.
#raditionally it is a amily4s li&elihood' %ith their shop in the ront
and ho"se at the ba!$' %hile they r"n the retail b"siness. More than
QQD retailers "n!tion in less than CAA s*"are eet o shopping spa!e.
-lobal retail !ons"ltants KSA #e!hnopa$' ha&e estimated that
organi)ed retailing in India is e+pe!ted to to"!h Rs EC'AAA !rore in the
year FAAC7A@. #he Indian retail se!tor is estimated at aro"nd Rs
QAA'AAA !rore' o %hi!h the organi)ed se!tor a!!o"nts or a mere F per
!ent indi!ating a h"ge potential mar$et opport"nity that is lying in the
%aiting or the !ons"mer7sa&&y organi)ed retailer.
:"r!hasing po%er o Indian "rban !ons"mer is gro%ing and branded
mer!handise in !ategories li$e Apparels' 1osmeti!s' Shoes' .at!hes'
Be&erages' ,ood and e&en Se%ellery' are slo%ly be!oming liestyle
prod"!ts that are %idely a!!epted by the "rban Indian !ons"mer.
Indian retailers need to ad&antage o this gro%th and aiming to gro%'
di&ersiy and introd"!e ne% ormats ha&e to pay more attention to the
brand b"ilding pro!ess. #he emphasis here is on retail as a brand
rather than retailers selling brands.
#he o!"s sho"ld be on branding the retail b"siness itsel. In their
preparation to a!e ier!e !ompetiti&e press"re' Indian retailers m"st
!ome to re!ogni)e the &al"e o b"ilding their o%n stores as brands to
reinor!e their mar$eting positioning' to !omm"ni!ate *"ality as %ell
as &al"e or money. S"stainable !ompetiti&e ad&antage %ill be
dependent on translating !ore &al"es !ombining prod"!ts' image and
rep"tation into a !oherent retail brand strategy.
#here is no do"bt that the Indian retail s!ene is booming. A n"mber o
large !orporate ho"ses T #ata4s' Rahe(a4s' :iramals4s' -oen$a4s T
ha&e already made their oray into this arena' %ith bea"ty and health
stores' s"permar$ets' sel7ser&i!e m"si! stores' ne% age boo$ stores'
e&ery7day7lo%7pri!e stores' !omp"ters and peripherals stores' oi!e
e*"ipment stores and home9b"ilding !onstr"!tion stores. /&ery retail
!ategory has been atta!$ed' by the organi)ed players today. #he Indian
retail s!ene has %itnessed too many players in too short a time'
!ro%ding se&eral !ategories %itho"t loo$ing at their !ore
!ompeten!ies' or ha&ing a %ell tho"ght o"t branding strategy. #o
ill"strate' the Indian liestyle9ashion retail s!ene is already e+hibiting
the ollo%ing !hara!teristi!s' %hi!h do not a"g"r %ell or its "t"re0
La#? ! s$re di!!eren$ia$in A Leading retail stores li$e Shoppers
Stop' Liestyle' /bony' -lob"s' and :yramid' oer !ommon brands'
similar ambien!e' and a !ommitment to impro&ed ser&i!e. .here is the
s!ope or dierentiation and brand b"ilding= 1an these retailers hope
that lo!ation and ambien!e alone %ill do the tri!$= Mer!handising
m"ddle 0 M"mbai4s original retailers o M"mbai T' Amarsons'
A$barallys' Ben)er' :remsons T ha&e e+perien!ed no de!rease in
trai! in their stores' e&en ater :yramid and .estside opened shop.
#hese retailers e+ploit %hat they $no% best T %hat the !"stomer
%ants %ith regard to prod"!t' sele!tion and pri!e T and ens"re their
!"stomers do not go ba!$ disappointed. 1ons"mer insights b"ilt o&er
their years o e+perien!e in b"siness is helping them to hold the ort
against the onsla"ght o the ne% players on the hori)on.
#he organi)ed ne% generation Indian retailers ?Shoppers Stop and
.estsideB ha&e re!r"ited senior retail persons rom abroad' %ho ha&e
the e+pertise in setting "p systems and pro!ed"res' b"t they are going
to ta$e a long %hile to t"ne into the psy!he o the Indian !ons"mer.
.ith the perm"tations and !ombinations o seasons' ashions and
regional preeren!es' mer!handising is at the best o times a !omple+
tas$. India4s !"lt"ral di&ersity poses additional !hallenges to the
mer!handisers re*"iring them to be a%are o lo!al tastes and to be able
to !ompete %ith the lo!al retailer in terms o mar$et $no%ledge and
speed o response. .hile te!hnology and systems are no do"bt
enablers' there !an be little s"bstit"te or e+perien!e and insight.
La#? ! =aBe=s@s*pp=iersA Organi)ed Indian retailing has to a!e the
sit"ation o la!$ o proessional s"ppliers %ho are a!!"stomed to
deadlines' systemati! in their prod"!tion and !onsistent %ith their
*"ality. Oten' the lo!al s"ppliers do not ha&e inan!ial strength or
prod"!tion inrastr"!t"re or dis!ipline. Indian mer!handisers are
or!ed to !ompromise d"e to a tr"e la!$ o !hoi!e T %hi!h leads to
h"ge "nsold sto!$s and red"!ed proitability to the retailers.
Dis#*n$ingA -i&en %idespread a&ailability o the same brands' large
retailers ha&e to !ope %ith the phenomenon o dis!o"nts oered by the
smaller retailers. Large stores are able %rangle larger margins rom
most s"ppliers' b"t these margins are retained to meet the higher
operating !ost. Small retailers are tempted to pass on the lo%er
o&erhead in the orm o a dis!o"nt to the !"stomer to get them to their
stores. In a middle !lass dominated' pri!e7sensiti&e mar$et li$e India'
pri!e manip"lation is a strong %eapon in the arsenal o the small
independent retailer.
#he large retailers themsel&es "rther dil"te the strength o the retail
mar$et. .ith promotions be!oming the order o the day' they too ha&e
entered into pri!e %ars against ea!h other. JUp to CAD o4 sales and
J#%o or one4 pri!e oers ha&e no% be!ome !ommonpla!e e&en at the
top retail o"tlets a!ross o"r !o"ntry. Deep pri!e !"ts may not be the
ans%er to maintain their rele&an!e against the small retailers nor does
it a"ger %ell or the brand b"ilding o the store.
Li,i$ed ,argins and high rea= es$a$e #s$sA It is %ell a!!epted that
Indian retailers %or$ on lo% margins !ompared to international !hains.
#he retail margins in India are a meager EA to EC per !ent or ashion
brands ?as' say' !ompared to CA to ;AA per !ent a!ross /"ropeB. .ith
o&erheads and allo%an!e or dead sto!$' the Indian retailer is not let
%ith m"!h s!ope or error. 1ost o prime land or the retail store is
prohibiti&e. Land pri!es in prime lo!alities a!ross the metros ha&e
themsel&es be!ome a ma(or deterrent to s"staining a proitable
retailing model or organi)ed players. A n"mber o the ne% !hains
ha&e thereore preerred to spread in smaller metros' hoping to oset
lo%er re&en"e potential %ith lo%er real estate !osts.
DTi,e aB*ndan$E #ns*,ersFA In re!ent years' it %o"ld seem that the
!ons"mer has thro%n the adage Jtime is money4 to the %inds. #he
!"stomer is %illing to spend more time i he9she is getting a better
deal. S!ar!ity o time seems to be the prerogati&e only o a e%
!ons"mers. #he !ro%ds inside Sar&ana Stores or Saya!handran te+tiles
in :ondy Ba)aar in 1hennai' dri&e home the point that !ons"mers are
prepared to tra&el to rea!h stores that promise best pri!es.
#he Indian model o organi)ed retailing is still in a stage o e&ol"tion'
and retailers need to "nderstand the &al"e o retail as a brand rather
than remaining as retailers selling brands. 8o%e&er' the !hara!teristi!s
o the branding pro!ess' %hi!h are o interest to the retailers' are still
the !hara!teristi!s o the traditional prod"!t brands < they are simply
e+tended to the intangible part o the b"siness. #h"s' the
!hara!teristi!s o a branded prod"!t are simply applied in a dierent
spa!e.
Re$ai= Brand B*i=ding
:rod"!t brands ma$e lie easier. #hey ma$e it possible to re!ogni)e
prod"!ts' %hi!h simpliies the de!ision ma$ing pro!ess. ,"rthermore'
prod"!t brands ma$e the !ons"mer a part o a gro"p3 they !reate a
sense o belonging. B"t retail brands do e&en more than that. #hese
brands are &isible platorms or $indred spirits0 the physi!al shop is a
!ontainer or the entire retail orm"la and thereore !onstit"tes a large
part o the retail brand. #he tangible nat"re o retail ma$es the
amiliar slogan Je+perien!ing the brand4 most logi!al o all' in a
physi!al store.
Retail brands ha&e gained in pop"larity in the past e% years. Indeed'
they ha&e a n"mber o ad&antages abo&e prod"!t brands. In the irst
pla!e' they are !loser to the !ons"mer.
#he physi!al store spa!e oers the possibility o literally and
ig"rati&ely !omm"ni!ating %ith !ons"mers at the moment o p"r!hase
?one7to7one mar$etingB. Retailers !an sho% %ho they are and %hat
they stand or thro"gh the store orm"la. Moreo&er' in prin!iple'
retailers are ne"tral' be!a"se the !hoi!e o prod"!t brand ?or store
brand' i presentB is let to the !ons"mers. Retailers help !ons"mers
be!a"se they ma$e a shre%d pre7sele!tion and present their prod"!t
assortment in a spe!ii! manner. On!e a !ons"mer $no%s and tr"sts a
retailer and has good e+perien!es and memories abo"t a store' the
o"ndation has been laid or a long7lasting relationship that %ill
"ltimately lead to !"stomer loyalty.
Retail branding !reates a brand preeren!e' %hi!h goes beyond the
prod"!t or ser&i!e in itsel.
&ND&AN RETA&L 6RAND 6/&LD&NG G T'E ROAD MAP A'EAD
#here is no do"bt that the Indian retail shopping e+perien!e has been
enhan!ed by giant s"perstores and shopping malls a!ross o"r !o"ntry.
#hey sho"ld ho%e&er learn *"i!$ly to b"ild the retail brand dire!tly
and not loo$ to a!tors li$e priming lo!ation' &al"ing pri!ing or
prod"!t assortment to b"ild their b"sinesses. Indian retailers' to b"ild
a strong retail brand presen!e' !an "se the ollo%ing strategies.
Relationship management to enhan!e in7store shopping e+perien!e0
1ompetition %ill or!e retailers to thin$ abo"t their !"stomers as
indi&id"als' analy)e their shares o !"stomers and !al!"late their
!"stomer lietime &al"es. Retailers need to b"ild data bases "sing in7
store data !olle!tion and la"n!h re*"ent shopper re%ards' !arry on an
intera!ti&e !omm"ni!ation %ith them' ma$e spe!ial oers' dri&e
trai! and add &al"e o"tside the in7store relationship.
Retail brands get b"ilt by de&eloping personal relationships %ith
!ons"mers rather than only thro"gh prod"!t and pri!ing. ,or e+ample'
sta sho"ld be trained to re!ogni)e their V.I.: !"stomers. JSot4
re%ards or V.I.: !"stomers in!l"de priority ser&i!e' ree git7
%rapping' enhan!ed g"arantees and sales pre7notii!ations. J8ard4
beneits in!l"de pri&ileged re%ards and e+tra &al"e oers as %ell as
straight dis!o"nts.
#he *"ality o management o the !"stomer is be!oming an
in!reasingly important so"r!e to%ards b"ilding the retail brand.
/d"!ation and training o sta needs to be done to enhan!e !"stomer
ser&i!e. Lo!al store management !an be empo%ered to ma+imi)e the
&al"e o ea!h !"stomer &isit. Analysis o !"stomer beha&ior !an g"ide
store mer!handising to mat!h the proile o their !"stomers and e&en
the needs o the shoppers at dierent times o the day.
/+ternal !omm"ni!ation to add &al"e o"tside the store0 Retailers "se
ad&ertising to b"ild their brands and promotions to dri&e store trai!.
Retailers ha&e' still not elt the !on!ept o indi&id"al !"stomer
!omm"ni!ation o"tside the stores as a ne!essity. It is ne!essary that
they see$ to add a ne% orm o dialog"e %ith their !"stomers. Retail
!hain S"bi$sha' or e+amples' mails a broadsheet to its !"stomers
gi&ing them details o the promotional oers a&ailable and pri!e
!omparisons a!ross brands that helps its !"stomers to ta$e more
inormed de!isions. Moti&ating the sta to &ol"nteer &al"e0 #he
*"ality o in7store ser&i!e is a $ey a!tor in dierentiating the retailer
and %inning a higher share o !"stomer spend. In one s"r&ey' shoppers
%ere as$ed' %o"ld they as$ or the same salesperson on their ne+t
p"r!hase &isit3 the Jyes4 respondents %ere o"nd to more li$ely gi&e
the store an H7;A rating. On the other hand' shoppers "nhappy %ith the
salesperson ga&e the store a &ery lo% perorman!e on o&erall ser&i!e
and perorman!e. Sta m"st be trained and moti&ated to re!ogni)e
their best !"stomers and to oer them s"perior ser&i!e.
S"!!ess"l retailing has al%ays been said to be' abo"t getting the
nitty7gritty right o mer!handising' ore!asting' the s"pply !hain'
training and re!r"itment o high *"ality personnel and !ategory
management. B"ilding retail brands that oer &al"e %ill' in "t"re'
o&ershado% all these areas' and emerge as the dominant reason or the
s"!!ess o the organi)ed Indian retailer. Indian retailers sho"ld also
"nderstand that the retail e+perien!e has be!ome a pop"lar leis"re
a!ti&ity and they are &"lnerable to any ne% !ompetition or !"stomers4
entertainment.
Indian retailers m"st b"ild their brands %ith images that see$ to
entertain and in&ol&e their !"stomers. It is the *"ality and &al"e o the
retail brands that they ha&e so"ght to establish that %ill determine the
loyalty o the retail shopper in "t"re.
Re$ai=ing in &ndia
#he retail mar$et si)e in India is estimated to be aro"nd O;HA billion.
Retailing pro&ides (obs to almost ;C per!ent o employable Indian
ad"lts and it is perhaps the largest !ontrib"tor to India> s -D:.
B"t the lip side o the !oin is that the a&erage si)e o ea!h o the
retail o"tlets in India is only CA s*"are eet and tho"gh a large
employer' the ind"stry is &ery "norgani)ed' ragmented and %ith a
r"ral bias.
The &ndian re$ai= ind*s$r- is *nrganiCed
#here are nearly t%el&e million retail o"tlets in India and the n"mber
is gro%ing. #%o thirds o these stores are in r"ral lo!ation. #he &ast
ma(ority o the t%el&e million stores are small Lather and sonL
o"tlets. Share o the "norgani)ed se!tor is QHD.
The &ndian re$ai= ind*s$r- is !rag,en$ed
Retail stores in India are mostly small indi&id"ally o%ned b"sinesses.
#he a&erage si)e o an o"tlet is CA s.*. ,t. and tho"gh India has the
highest n"mber o retail o"tlets per !apita in the %orld' the retail
spa!e per !apita at F s.*. ,t per person is amongst the lo%est in the
%orld.
The &ndian re$ai= ind*s$r- has r*ra= Bias
Iearly t%o thirds o the stores are lo!ated in r"ral areas. #he retail
ind"stry in r"ral India has typi!ally t%o orms0 L8aatsL and LmelasL.
8aats are the %ee$ly mar$ets0 they ser&e gro"ps o ;A7CA &illages and
sell day7to7day ne!essities. #hey are re*"ently "sed as replenishment
point or the small &illage retailer. Melas are larger in si)e and more
sophisti!ated in terms o the goods sold. Mela mer!handise %o"ld
in!l"de more !omple+ man"a!t"red prod"!ts s"!h as tele&isions.
/&en in "rban areas' organi)ed in India is restri!ted to the top e%
!ities o the !o"ntry as sho%n in #able gi&en belo%0
1ities
#op
@
Ie+t
K
#op
@
Ie+t
K
;QQQ
FAAC
?/+pe!tedB
Distrib"tion
o organi)ed
retailing
HHD ;FD @@D FAD
The e+=*$in ! &ndian re$ai= ind*s$r-
,or Indian retailing' things started to !hange slo%ly in the ;QHAs'
%hen India irst began opening its e!onomy. #e+tiles se!tor ?%hi!h
!ompanies li$e Bombay Dyeing' Raymond> s' S K"mar> s and -rasimB
%as the irst to see the emergen!e o retail !hains. Later on' #itan'
ma$er o premi"m %at!hes' s"!!ess"lly !reated an organi)ed retailing
!on!ept in India by establishing a series o elegant sho%rooms.
,or long' these remained the only organi)ed retailers' b"t the latter
hal o the ;QQAs sa% a resh %a&e o entrants in the retailing
b"siness. #his time aro"nd it %as not the man"a!t"rer loo$ing or an
alternati&e sales !hannel. #hese %ere p"re retailers %ith no serio"s
plans o getting into man"a!t"ring. #hese entrants %ere in &ario"s
ields' li$e 7 ,ood.orld' S"bhi$sha and Iilgiris in ood and ,M1-3
:lanet M and M"si! .orld in m"si!3 1ross%ord and ,o"ntainhead in
boo$s.
As o the year ending FAAA the si)e o the Indian organi)ed retail
ind"stry %as estimated at aro"nd Rs. ;E'AAA !rore. #he &ario"s
segments that ma$e "p the organi)ed retail ind"stry along %ith their
si)e are in table gi&en belo%. Retail gro%th is already gathering
moment"m and the organi)ed retail ind"stry is e+pe!ted to gro% by EA
per !ent in the ne+t i&e years and is e+pe!ted to to"!h Rs. KC'AAA
!rore in FAAC. #h"s' the gro%th potential or the organi)ed retailer is
enormo"s.
Segment
Mar$et Si)e ?Rs.
1roreB
#e+tiles and !lothings KACA
Se%ellery F'AAA7F'CAA
1ons"mer D"rables ;CAA
,oot%ear ;'EAA7G'CAA
,ood and personal !are ;AAA
Ion7Store retail QAA
L"ggage' %at!hes and
tyre
CAA
IIDIAI R/#AIL BOOM
Retailers are no% also aggressi&ely mo&ing into de&eloping their o%n
pri&ate labels as a ta!ti! to impro&e operating gross margin. Initially'
this has been done in the apparel !ategories by retailers s"!h as
Shoppers Stop and :antaloon ?and more re!ently by -lob"sB and in
ood 2 gro!ery !ategories by ind"stry leaders s"!h as ,ood %orld. .e
%o"ld see in!reasing press"re on other branded goods as %ell in not so
distant "t"re.
LEAD&NG RETA&LERS
Pan$a=nA Fashin B- Pan$a=n
:antaloon is the !ompany> s departmental store and part o lie style
retail ormat. In a!t' :RIL too$ its &ery initial steps in the retail
(o"rney by setting "p the irst :antaloon store in Kol$ata in ;QQG. In a
short time :antaloon has been able to !ar&e a spe!ial pla!e or it sel
in the hearts and minds o the aspirational Indian !"stomers. #he
!ompany has depth o oering or both men and %omen at aordable
pri!es. A stri$ing !hara!teristi! o :antaloon has been the strength o
its pri&ate label programme. Sohn Miller' A(ile. S!otts&ile' Lombard'
Annabelle are some o the s"!!ess"l brands !reated by the !ompany.
.ith ;E stores a!ross the !o"ntry and an e&er7in!reasing stable o
pri&ate brands' :antaloon 7 in the !oming years is poised to be!ome a
leading ashion trendsetter.
6ig 6aCaarA &s se sas$a a*r a#ha ?ahin nahin
Big ba)aar is the !ompany4s oray into the %orld o hypermar$et
dis!o"nt stores' the irst o its $ind in India. :ri!e and the %ide array
o prod"!ts are the US:4s in Big Ba)aar. 1lose to t%o la$h prod"!ts
are a&ailable "nder one roo at pri!es lo%er by F to @A per !ent o&er
the !orresponding mar$et pri!es. #he high *"ality o ser&i!e' good
ambien!e' impli!it g"arantees and !ontin"o"s dis!o"nt programmes
ha&e helped in !hanging the a!e o the Indian retailing ind"stry. A
leading oreign bro$ing ho"se !ompared the r"sh at Big Ba)aar to that
o a lo!al s"b"rban train.
Fd 6aCaar G Wh=esa=e pri#es
,ood Ba)aar4s !ore !on!ept is to !reate a blend o a typi!al Indian
Ba)aar and International s"permar$et atmosphere %ith the ob(e!ti&e o
gi&ing the !"stomer all the ad&antages o R"ality' Range and :ri!e
asso!iated %ith large ormat stores and also the !omort to See' #o"!h
and ,eel the prod"!ts. #he !ompany has re!ently la"n!hed an
aggressi&e pri&ate label programme %ith its o%n brands o tea' salt'
spi!es' p"lses' (ams' $et!h"ps et!. .ith "nbeatable pri!es and &ast
&ariety ?there are KF &arieties o ri!e on saleB' ,ood Ba)aar has pro&ed
to be a hit %ith !"stomers all o&er the !o"ntry.
Cen$ra= Ma== > ShpH Ea$H Ce=eBra$e.
Lo!ated in the heart o the !ity' 1entral are i&e loors o !"stomer
antasy. ,rom the basi! to the e+tra&agant' rom home "rnishings to
gro!eries' rom apparel to %hite goods' rom A#M4s to
resta"rantsUUUUU. And many more all "nder one rooV
1entral %ill pro&ide !"stomers the opport"nity o !hoosing rom
amongst the best brands in apparel' toys' boo$s' m"si!' sports'
liestyle a!!essories and more. .ith more than EAA brands and loors
dedi!ated or %omen' men' yo"th and home' 1entral aims to pro&ide
!"stomers %ith an array o options ne&er seen beore.
MALLS &N &ND&A
A de!ade ago < not a single mall
C years ago < less than hal a do)en
#oday < KA malls
F years rom no% < EAA malls
IIDIA R/#AIL BY FAA@7FAAG
CA million s* t o *"ality "nder de&elopment
G ma(or !ities to a!!o"nt or K; million s* t de&elopment
EAA malls' shopping !enters and m"ltiple+es "nder !onstr"!tion
#o open EC hypermar$ets 'EFC large department stores' ;CAA
s"permar$ets and o&er ;A'AAA ne% o"tlets.
Many strong regional and national players emerging a!ross ormats
and prod"!t !ategories. Most o the these players are no% geared to
e+pand ar more rapidly than the initial years o starting "p most ha&e
regained 9impro&ed proitability ater going thro"gh their perspe!ti&e
learning !"r&es.
O69ECT&(ES
OBje#$i+e ! $he Prje#$A

#o ind o"t 1"stomer satisa!tion le&el %ith the Shopping Malls.
Kne% the :resent s!enario o Shopping Malls in India.
Understand the per!eption o !"stomer to%ards the Shopping
Malls.
Kne% the !"stomer e+pe!tation abo"t Shopping Malls.
#o orm"late the strategies or the Indian retail se!tor or bright
"t"re.
.
RESEARC' ME'ODOLOG0
#he *"estionnaire is the most %idely a!!epted resear!h instr"ment.
#he *"estionnaire %as designed $eeping in mind the resear!h
ob(e!ti&e. As mentioned earlier' sin!e the !ompany %anted
*"antitati&e inormation' most o the *"estions %ere !lose ended %ith
respondent !hoosing one o the options gi&en. 8o%e&er *"estions
soli!iting perpet"al or dii!"lt *"antiy type ans%ers %ere let open7
ended.
A !opy o *"estionnaires "sed is gi&en in the Appendi+.
RESEARC'A >
Resear!h in !ommon parlan!e reers to a sear!h or $no%ledge. One
!an also deine resear!h as a s!ientii! and systemati! sear!h or
pertinent inormation on a spe!ii! topi!.
#he topi! o my resear!h %as to0 5#o e+plore the !"stomer per!eption
to%ards pri&ate label9Brands o Retailers.6
RESEARC' MET'ODOLOG0A
Resear!h Methodology is a %ay to systemati!ally sol&e the resear!h
problem. It may be "nderstood as a s!ien!e o st"dying ho% resear!h
is done s!ientii!ally. #o do my st"dy I ha&e adopted e+ploratory
resear!h design.
Resear!h Design /+ploratory
Data So"r!e :rimary 2 Se!ondary data
Resear!h Instr"ment R"estionnaire
Sample :lan Shopping Malls o -ha)iabad
Sample Si)e CA !"stomers
Sampling :ro!ed"re Ion :robability Sampling
Sampling Methodology :ersonal S"r&ey Method #hro"gh the
&ario"s steps' %hi!h are in&ol&ed in the e+ploratory resear!h' are
as0
Resear!h Design
Methods o data !olle!tion
Sample si)e
Area o sampling
Data analysis
,indings
S"ggestions
RESEARC' DES&GNA >
#he approa!h is aimed at identiying the a%areness and brand image
among the !"stomers. As the st"dy e+plore the possible !"es o brand.
All the &ariables as sho%n in the table ha&e been standardi)ed to
!onstr"!t the tools.
MET'OD OF DATA COLLECT&ON
,or doing my st"dy I ha&e "sed both primary and se!ondary data
:rimary data
Se!ondary data
PR&MAR0 DATAA > #he personal inter&ie% method has been stri!tly
adopted thro"gho"t the st"dy. #he primary data %as !olle!ted by
mar$et s"r&ey %ith the help o str"!t"red *"estionnaire. #he s!hed"le
in!l"des open7ended *"estions' ordinal s!ale *"estions and some
m"ltiple *"estions.
SECONDAR0 DATA
Se!ondary data obtained rom the ollo%ing0
So"rnals
Vario"s Arti!le
SAMPLE S&IE
It is the "nit' %hi!h is !onsidered or the p"rpose o the st"dy.
Sampling "nit is shopping malls at -ha)iabad area. #o !ommen!e the
st"dy sample si)e or'
1"stomer 7 CA
AREA OF SAMPL&NGA>
Shopping malls at -ha)iabad Region !o&er or the mar$et s"r&ey.
NAME OF T'E S'OPP&NG MALLSA >
S8I:RA MALL IIDRA:UIRAM -8AWIABAD
AISAL :LAWA VAIS8AL/ -8AWIABAD
-ALANY O::. VAIS8AL/ -8AWIABAD
SILV /R 1I#Y LAL KUA -8AWIABAD
./B KAUS8AMB/ -8AWIABAD
:A1I,I1 MALL O::. KAUS8AMB/ -8AWIABAD
ANAL0S&S
,inding ;.
;. Shopping Malls are mostly &isited by age gro"p o FA7EA ollo%ed by EA7KA
age gro"p.
F. #he reason being !ollege st"dents and amilies.
TaB=e 1

Gra! "
Finding 2
;. Mostly !"stomers preer S8O. ROOMS AID S8O::II- MALLS or
p"r!hasing.
F. Lo!al Mar$ets are mostly "sed or shopping that in!l"des MOM 2 DAD4 s
shop.
AGE Total Percentage
16-20 10 30%
20-30 15 20%
30-40 10 20%
40-50 8 16%
50 and
over 7 14%
Total 50 100%
TaB=e 2
LOCATION TOTAL PERCENTAGE
IRANA
!TORE 8 16%
LOCAL
"ARET 12 24%
!#OPPING
"ALL! 15 30%
!#O$
ROO"! 15 30%
TOTAL 50 100%
Graph 2
Finding 3
;. Mostly respondents go or shopping p"rposes in shopping malls.
F. EHD respondents go or ha&ing a "n in shopping malls.
E. .indo% Shopping is also one big a!tor o attra!tion to%ards shopping
malls.
TaB=e 3
Graph 3
Finding 4
;. Mostly respondents "sed to go ortnightly to shopping malls.
F. EAD respondents "sed to go %ee$ly or &ario"s p"rposes to shopping malls.
E. Only ;AD people go daily at shopping malls.
P%RPO!E TOTAL PERCENTAGE
!#OPPING 23 46%
ENTERTAIN"ENT 1 38%
$IN&O$
!#OPPING 8 16%
TOTAL 50 100%
P%RPO!E O' (I!ITING !#OPPING "ALL!
SHOPPING
46%
ENTERTAINMENT

38%
!INDO!
SHOPPING
16%
TaB=e 4

(I!ITING
'RE)%ENC* TOTAL PERCENTAGE
&AIL* 5 10%
$EEL* 15 30%
'ORTNIG#TL* 20 40%
"ONT#L* 10 20%
TOTAL 50 100%
Graph 4
Finding 5
1. A!!ording to respondents all "nder one room !on!ept %as the main
moti&ator a!tor behind the s"!!ess o shopping mall.
2. Se!ond preeren!e !hoi!e %as a&ailability o branded Item.

(I!ITING
'RE)%ENC*
DAILY
10%
!EE"LY
30%
FORTNIGHTLY

40%
MONTHLY
20%
TaB=e 5
A++orda,-l-t.
/randed
Ite0
Trend 1
'a23-on
All
4nder
one
roo0 Total
12t
Per+ 4 5 5 30 50
2nd 10 20 12 5 50
3rd 14 12 16 5 50
4t3 22 10 14 4 50
Total 50 50 50 50 200
Graph 5
Finding 7
;. @AD respondents are satisied %ith the pri!ing s!hemes at shopping malls.
F. KAD respondents %ere not satisied %ith the pri!ing s!hemes.
TaB=e 7
PRICE
!ATI!'ACTION TOTAL PERCENTAGE
*E! 30 60%
NO 20 40%
TOTAL 50 100%
Graph 7
Finding 8
;. .ee$end R"sh %as the main problem or a normal !"stomer.
F. ;@D respondents %ere not happy %ith the :ar$ing ,a!ility at Shopping
malls.
TaB=e 8
&RA$/AC
IN "ALL! TOTAL PERCENTAGE
E6PEN!I(E 6 12%
PARING
'ACILIT* 8 16%
$EEEN&
R%!# 16 32%
OT#ER! 20 40%
TOTAL 50 100%
Graph 8
Finding :
;. GAD respondents said that lo!ation o shopping malls ae!ts Shopping mall.
F. EAD respondents ignore the lo!ation problem.
TaB=e :
LOCATION
AE''ECT! TOTAL PERCENTAGE
*E! 35 70%
NO 15 30%
TOTAL 50 100%
Graph :
Finding ;
;. Mostly respondents %ere highly satisied %ith the par$ing a!ility.
F. Respondents %ere agreeing that *"ality o ser&i!e is "p to mar$ at shopping
malls.
E. A!!ording to most o the respondents *"ality o the prod"!ts %as good.
K. Respondents %ere satisied or the money paid at shopping malls.
TaB=e ;
E7cellent Good Average Poor TOTAL
PARING
'ACILIT* 30 11 5 4 50
)%ALIT*
O'
!ER(ICE 11 25 8 6 50
)%ALIT*
O'
PRO&%CT 16 15 10 50
(AL%E
'OR
"ONE* 8 20 11 11 50
Graph ;

30
11
16
5
11
25
15
20
5
5
10
11
4
6
8
11
1
0 10 20 30 40 50 60
PARIN
G 'ACILIT
*
)%ALIT*
O' !ER(IC
E
)%ALIT*
O'
PRO&%
CT
(AL%E
'OR
"ONE
*
E#$%&&%'(
G))*
A+%,-.%
P)),
On the basis o this %e !an say that
;. &isitors are mostly satisied %ith the par$ing a!ility.
F. R"ality o ser&i!e is belo% good and abo&e a&erage.
E. *"ality o prod"!t is ollo%ed by &al"e or money.
F&ND&NGS
Malls are "nable to et!h more re&en"e to the shops or the stores.
B"ilders are in proit not the stores.
#he only s"!!ess"l o"tlets are /A#II- OU#S and R/1R/A#IOI
1/I#R/S in the malls.
Apparel stores ha&e ma+im"m emales !"stomers.
Ma+im"m ootall is on %ee$ends.
Brands and trends attra!t people to%ard malls.
:ar$ing is the ma(or problem on %ee$ends.
CONCL/S&ON
Shopping Malls' espe!ially in a pri!e sensiti&e mar$et li$e in IIDIA' ma$e money
rom ma$ing the s"pply !hain more ei!ient. #hro"gh a !ombination o !"tting
!ost and s%eating assets' it4s possible to impro&e the ret"rn on !apital by ;A7;F
per!ent' %hi!h or an ei!ient retailer sho"ld be EA7KA per!ent.
#h"s optim"m in&entory sto!$' ma+imi)ing reali)ation per s*"are eet' identiying
prod"!ts %ith highest margin' and ens"ring depth and %idth o prod"!ts is the
name o the game.
#o be more s"!!ess"l retailers %ill need to rene% ormats *"i!$ly' as ormats that
earlier lasted' ;A7;F years' today b"rn o"t in three to o"r. B"t as global e+perien!e
in the ind"stry sho%s its oten easier to get a ormat %rong than right. #here are
inherent ris$s to b"ilding a s"per si)e retail empire.
#he retailers m"st learn to stri$e a balan!e bet%een e!onomies o s!ale and
regional disparities.
S/GGEST&ON
1ompanies sho"ld try to !hange the !ons"mer4s per!eption regarding
shopping malls or retail se!tor as a hole to attain ma+im"m proit.
Retail se!tor sho"ld !on!entrate on s"pply !hain management be!a"se being
in BFB Mar$et3 ee!ti&e s"pply !hain !an minimi)e the !ost o items.
1ompanies m"st o!"s on positioning o ea!h and e&ery item in shopping
mall to not only attra!t the !"stomers b"t also to ma$e them p"r!hase them.
,o!"s sho"ld be on inrastr"!t"re ambien!e and re!reational a!ilities in
shopping malls.
1ompanies sho"ld do intera!tion and get eedba!$.
1ompanies sho"ld o!"s on mar$et needs.
1ompanies sho"ld target the !"stomer4s inspirational needs.
Spe!ial oers sho"ld be made a&ailable rom time to time to !on&ert
%indo% Shopping into a!t"al shopping.
6&6L&OGRAP'0
-.1. Beri 'Mar$eting Resear!h' #ata M!-ra% 8ill :"blishing 1o. Ltd.
FAAE

Da&id L"!$ 2 R"bin' Mar$eting Resear!h' :renti!e 8all o India :&t.
Ltd. Delhi FAAK
Mi!hel /. :orter' 1ompetiti&e Ad&antage ' #he ,ree :ress Ie% Yor$
FAAE
JMall .onder4' /!onomi! #imes' ; April FAAK
Retail detail4 #he 8ind" B"siness Lines San"ary FAAC
%%%.*"i!$mba.!om
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