RETAIL MARKETING

UNIT II RETAIL FORMATS

Organized and unorganized formats – Different organized retail formats –
Characteristics of each format – Emerging trends in retail formats – MNC's role in
organized retail formats.

UNORGANIZED RETAILING
Unorganized retailing is an individual having a small unstructured organization
to carry out retail activities with limited resources and capabilities that lack technical
and accounting standards.
Ex: Hawkers- Lari Galla Vendors:
 The self organized sector is characterized by the ―Lari-Galla Vendors‖ (also
known as ―mobile market‖) seen in every lane and nook and corners of the
country.
 Most retailing of fresh foods in India occurs in mandis and roadside hawker
parks. They are highly organized in their own way.
Kirana /Provision stores/Mom and Pop stores:
 Retailers like kirana are characterized by the more systematic buying from the
mandis or the farmers and selling from fixed structures.
 A sale done through tiny family-owned shops, as these kirana shops cater to the
needs of low value and high-frequency shops.

ORGANIZED RETAILING
Organized retailing refers to trading activities undertaken by licensed retailers
i.e., those who are registered for sales tax, income tax, etc. These include the corporate-
backed hypermarket and retail chains and also the privately owned large retail
businesses.
Ex: Franchised outlets- McDonald‘s, KFC.
 Discount stores- Subhiksha at Chennai.
 Department store chains- Pantaloons, Shoppers stop, Westside.
 Retail banking- HDFC, SBI

CLASSIFICATION OF RETAIL FORMATS

The retail formats are classified under three categories as under:
I. On the basis of ownership.
II. On the basis of merchandise offered.
III. Non-store retailing.
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I. Retail stores on the basis of ownership:
The term ‗retail sales by ownership‘ refers to the basic system of basic format of
doing business. In India, around 14 million retail outlets are covered under this format.
Proprietor is responsible for the success and failure of the store. The retail sale by
ownership is classified as under:
1. Independent store, 4. Leased department stores,
2. Chain stores, 5. Vertical Marketing system and
3. Franchising, 6. Consumer co-operatives.
1. Independent retailer: An independent retailer usually is a small retailer and is found
in all lines of trade and in all communities. He may be a young man, fresh graduate just
starting his own business. In India, many of the independent stores tend to be passed on
from one generation to another. The high numbers of independent retailers is associated
with the ‗ease of entry‘ into the market place. The entry and growth of independent
retailers in India is a big reason in the high rate of new retail outlets failure. Stores like
local baniya/kirana store and paanwala, are the examples of independent retailers.

Merits of Independent retailer:

 The independent retailer has no restriction on who, how or where the business to
be setup. He is free to select a convenient location.

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  The independent retailer takes all decisions related to the store functioning. It
drastically saves the time that usually exist between decision-making and
implementation process. He can respond quickly to environmental changes and
adopt proper strategies.
 The independent retailer can concentrate on a local area to achieve its business
goals.
 To serve the local demand, a retailer can decide the trading hours, merchandise to
be sold/ removed and prices as and when desired.
 It avoids duplication of work, ambiguity of role and excess stock due to clarity or
role, thus resulting in increased productivity and time utilization.
 To start an independent store is comparatively an easy task as it requires low
investment, modest fixtures and merchandise.
 He can provide deep merchandise to serve a particular consumer segment.

Demerits of independent retailer:

 Due to limited exposure and small investments, in most of the cases, they don‘t
stand in competition with the emergence of giant retailers and international store
outlets.
 As independent stores are dependent on labor intensive techniques, they find
themselves difficult to improve store-productivity when it comes to stock-
keeping, ordering, merchandizing, displays, accounting and dispatching.
 The bargaining power of independent retailers is comparatively less as they offer
limited merchandise.
 Due to limited operations, less working capital, improper logistic arrangements,
retailers are not able to have benefits of economies of scale.
 Independent retailers due to limited funds cannot go for mass sales promotion
programs resulting in limited target market and geographical coverage.

2. Chain store/ chain retailer: A chain retailer or a chain store is two or more outlets
that are commonly owned and controlled, sell similar lines of products, having a central
buying system, and operate in different localities of a particular area and or/in different
parts of the country. Every important policy relating to purchase, store displays, pricing
or sales is decided in the head office. Ex: Bata Shoe Company was the first example of
a chain store in India, after that Usha Sales Ltd, Delhi Cloth Mills (DCM), Mafatlal
textile shops etc., are another examples of chain stores in India. Archies, Big Bazaar,
Food Bazaar, McDonald‘s, Pantaloons, Spencers, Westide and Cafe Cofee Day are few
leading chain stores in India.

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Merits of chain stores:
 Good bargaining power with suppliers.
 Cost effectiveness due to centralized operations.
 Ease of managing store operations.
 Use of advanced technology increases their working efficiency.
 Experts hiring allow close monitoring of environmental changes.

Demerits of chain stores:

 The establishment cost to set up such chain of outlets requires huge money and
expertise.
 Difficulty in managerial control due to geographically dispersed branches/outlets.
 Due to centralized decision-making, some outlets may have difficulty in adapting
to local needs.
 Due to huge network of outlets, it is difficult for management to monitor their day
to day activities resulting in communication gap, inefficiencies, and delay in
decision-making.
 Expense on safety stock remains high.

3. Franchising: A franchise is a contractual agreement between the franchiser and the

franchisee that allows the franchise the right to supply its brand (goods and services)
exclusively within a defined area, as per a particular format for a specified period of
time. In return, franchisee pays a fixed fee in advance and a monthly percentage of
gross sales made by him under franchiser name and fame in the form of royalty. Coke,
Domino‘s Pizza, Mc Donald‘s Reliance Fresh etc are key franchisers in India.

Types of Franchising:
 Product or trademark franchising: A franchisee with mutual consent acquires
the name and identity of the franchiser by agreeing to sell the franchiser‘s goods
and services exclusively made and supplied by him under his name. Franchisee
use the franchiser‘s business methods, selling techniques, standardized product
lines and advertising on co-operative basis. Ex: Archies Gallery, Hallmark stores.
 Business based franchising: There is more synergetic relationship between a
franchiser and the franchisee. The franchisee receives assistance on the issue of
site location, building the store, quality control, accounting practices, training to
store employees and the problems faced in conducting the store. A franchisee
enjoys the benefits of prototype stores, standardized product lines, selling and

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 presenting skills and co-operative advertising. Ex: McDonald‘s outlets and
Domino‘s Pizza.
 Area development franchising system: The franchiser grants development
rights of a particular area to the franchisee in turn for a front-end development
fee. The franchisee on his part is responsible for developing a certain number of
units within a given period of time. Ex: Aptech computer training, Excel
InfoTech.

Merits of franchising to franchisee:

 Individual franchisee can own and run a retail store with relatively small
investment at relatively low risks.
 Franchisees acquire well established and successful brands that require very less
or no time to produce customers.
 In franchising, franchisee may be successful much faster.
 A franchisee usually has monopoly as he obtains exclusive rights for a specified
geographical location.
 As franchisee is the owner of the outlet, they take personal care and due attention.

Demerits of franchising to franchisee:

 Due to presence of more than one retail outlets of the same brand, the problem of
over-saturation may occur, resulting in low sales and division of profits among
each other.
 Under contractual agreement, franchisee may be restrict/bind to make purchases
through franchisor or through some approved suppliers as listed/provided by
them.
 Under some industries, franchisee agreements are of short duration which
requires yearly/continuous renewal upon expiry.
 A charging royalty over gross sales rather than franchisee profit is another big
disadvantage.

4. Leased department/Shop-in-shop: A leased department is a department in a retail

store--usually a department, discount, or specialty store--that is rented to an outside
party. The leased department proprietor is responsible for all aspects of its business
(including fixtures) and normally pays a percentage of sales as rent. The store sets
operating restrictions for the leased department to ensure overall consistency and
coordination. Leased departments are used by store-based retailers to broaden their
offerings into product categories that often are on the fringe of the stores major product

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lines. They are most common for in-store beauty salons, banks, photographic studios,
and shoe, jewelry, cosmetics, watch repair, and shoe repair departments. Ex: Lakme
area, lingerie‘s area, Titan area, woodland area in shopper‘s stop.

Advantages of leased departments:

 The market is enlarged by providing one-stop customer shopping.
 Leased stores pay for property, personnel and other expenses resulting in fewer
burdens on lesser.
 Lessor gets regular monthly income in the form of rent.
 Personnel management, merchandise displays, and reordering items and retail
system with pos equipment are undertaken by lessees.

Disadvantages of leased departments:

 Leased department operating procedures may conflict with store procedures.
 Lessees may adversely affect stores images.
 Customers may blame problems on the stores rather than on the lessees.

5. Vertical Marketing System: A vertical marketing system (VMS) is one in which the
main members of a distribution channel—producer, wholesaler, and retailer—work
together as a unified group in order to meet consumer needs. Three types of VMS are in
existence through which goods and services are usually distributed to customers:
 Independent firm VMS: is a marketing system where manufacturers play vital
role to provide goods and services to customers. When firm‘s financial resources
are limited and channel members are not in a position to share risks and expenses,
they want manufacturer to come forward and lead the retailing efforts. Ex: Coke,
GE, P&G, Toys R Us.
 Partially integrated VMS: With a partially integrated system, two
independently owned businesses along a channel perform all production and
distribution functions. It is most common when a manufacturer and a retailer
complete transactions and shipping, storing, and other distribution functions in
the absence of a wholesaler. This system is most apt if manufacturers and
retailers are large, selective or exclusive distribution is sought, unit sales are
moderate, company resources are high, greater channel control is desired, and
existing wholesalers are too expensive or unavailable. Partially integrated
systems are often used by furniture stores, appliance stores, restaurants, computer
retailers, and mail-order firms.

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  Fully integrated VMS: A fully integrated VMS develops when either a
manufacturer integrates forward and attempts to reach the consumer or retailers
directly by a process called disintermediation or a retailer integrates backward
and gets access to a supply chain that improves its ability and efficiency to serve
the customers. The manufacturer typically invests the resources to create a
channel by way of company-owned stores manned by their employees. Bata, for
example started with this strategy of retailing its range of foot ware through
company-owned stores. Titan Ltd- a Tata group company preferred to retail its
wrist watches through company-owned retail outlets.

6. Consumer Cooperatives: A consumer cooperative is a cooperative business owned

by its customers for their mutual benefit. It is a form of free enterprise that is oriented
toward service rather than pecuniary profit.

Characteristics:
 A consumers‘ co-operative society is a voluntary association of persons and is
registered under the Co-operative Societies Act.
 Profit is shared by its members.
 Goods are sold to members or non members at reasonable prices.
 Average customer service.
Ex: Delhi consumer‘s cooperative wholesale store limited, Indian Farmers Fertilizer
Cooperative Limited and Tamil Nadu Co-operative Milk Producers' Federation
Limited.

II Retail Stores on the Basis of Merchandize Offered

A. Food based retailers
B. General Merchandize Retailers

A. Food based retailers: Food stores are becoming popular as even better quality
goods they are offering in low cost under hygienic and attractive ambience outlets with
dining arrangements.

Food stores in India are divided into four categories:

1. Convenience Store.
2. Conventional Super Markets.
3. Food based Super Stores.
4. Combination Store.

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1. Convenience Stores: There are small retailers that offer a limited variety of
merchandise at small scale but convenient locations ranging from 2,000- 3,000
sq.ft.
 Positive aspects: Quick shopping, less checkout time, Self service level,
long shopping hours.
 Negative aspects: Limited product range, High pricing, Small stores.

Ex: 7-Eleven, Circle-K

2. Conventional Super Market: A conventional super market is a

departmentalized grocery store with a wide range of dairy products and
household items such as soft drinks, household cleaning products, shampoos,
soaps, clothes, medicines and plastic items.

Advantages:
 It is relatively large.
 Low priced, Low-margin, High volume, Self-service operation, Convenient
shopping and space for parking.

Ex: Nilgiris is a supermarket chain in South India. It is also one of the oldest
supermarket chains in India with origins dating back to 1905 and hence its
products are sold under the brand name of "Nilgiris 1905". It also has a store
brand, and produces dairy, baked goods, chocolates, and other products under the
same name.

3. Food based superstores: Superstores are usually large supermarkets that have
space area ranges from 20,000 to 50,000 sq.ft. These stores sell grocery items and
offer customers that ability to buy fill-in general merchandise.

Features:
 Offer one-stop shopping experience.
 Stimulate impulse purchase.
 The concept of EDLP (Every Day Low Pricing) is usually followed.
 Large, low margin and self service stores.

Ex: Burger King, KFC, Domino‘s, Subway.

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 4. Combination stores/Super centres: Combination stores basically are food-
based retailers that combine their supermarket and general merchandise sales at
one place. In a combination store, general merchandise sales usually accounts for
30-40% of total store sales. Combination stores are large, from 30,000 up to
100,000 or more square feet. As economies of scale are higher in a combination
store, therefore, these stores offer low pricing policy and make profits on account
of impulse sales. Combination stores provide one-stop shopping experience, and
therefore, customers do not consider distance factor to come to these stores.
A supercenter is a combination store blending an economy supermarket with a
discount department store. It is the U.S. version of the even larger hypermarket.
As a rule, the majority of supercenter sales are from nonfood items. Stores
usually range from 75,000 to 150,000 square feet in size and they stock up to
50,000 and more items, much more than the 30,000 or so items carried by other
combination stores. Ex: Wal-Mart, Kmart, and Target all operate some
supercenters.

B. General Merchandize Retailers: General merchandise retailers usually sell

all non-food items such as house wares, furniture, consumer electronics,
toiletries, toys, greeting cards, plastic wares, hardware, Jewelry items, shoes,
kitchen appliances, clothes, readymade garments, bakery, music world, gift items,
cell phones, home appliances, cooking wares, furniture, sports and food courts.

The retailers under General Merchandise category are classified as under:

1. Discount Stores
2. Specialty Stores
3. Factory Outlet Store
4. Hyper Markets
5. Departmental Stores
6. Membership Club
7. Parasite Store
8. Destination Store

1. Discount Stores/Discounters:
(a) Limited line Discount Store: Limited line discount stores sell limited lines of
merchandise at low prices but the brands offered are well reputed. Due to limited
line, stores may change their stock according to buying opportunities and change
in customer liking and disliking very frequently. Limited line discount stores may

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be located near the residential areas, out of city or edge of city to take advantage
of suburban site like easier access and lower rent.

(b) Full line Discount Store: A full line discount store offers broad merchandise
assortment in high volume but at low cost. As the name implies, besides carrying
the general product line expected at departmental store, it includes house wares,
kitchen wares, gardening, sports accessories, and auto accessories with
centralized check out service system. The reasons for the success of such retail
formats are many.
(a)Low pricing
(b) Average to good quality merchandise
(c) Good facilities
(d) Well managed standardized retail outlets.
These stores face strong competition from other retailers like category killers and
other low priced discounters.

(c) Off-price store: Off price retailers usually buy merchandise at less than
regular wholesale prices (normally between one-fifth to one-third of the original
wholesale price) and sell them at less than retail prices. Off price stores often buy
leftover merchandise, overruns, and irregulars obtained at low prices direct from
the manufacturers or big retailers. These stores offer an inconsistent merchandise
assortment, latest fashion goods at reduced prices. The reason for making them
enable to purchase at lower prices is that these stores/retailers don‘t claim/ask
suppliers for any advertising and sales promotion allowances and any delayed
payments. In India, these stores are usually run by the parent company to increase
the business under retailing format. Pantaloons factory outlets, Levi‘s factory
outlets and Liberty factory outlets are the examples of this category.

2. Specialty Store: A specialty store concentrate on a narrow product line, with a

deep assortment in that product line, such as apparel and accessories, furniture,
consumer electronics etc. The specialty stores have very clearly defined target
market and therefore provide a top level of consumer service and sales expertise
in the concerned category. These stores operate in an area typically not more than
8,000 sq. ft. in contrast to a mass marketing approach, specialty stores offer
limited variety but full range of merchandise. These stores generally have
discounted competitive pricing strategy.
A new sort of specialty retailer is emerging very fast in the country
especially in metros with the names of category specialists or category killers.
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A category killer is a discount store that offers a very large selection in the
concerned product category at affordable prices. Ex: ‗Nalli‘s‘ in Chennai can be
termed as category killer in Sarees, Toys ―R‖ Us offers more than 10,000 items in
their stores.

3. Factory Outlet Stores: A Factory retail outlet is a retail store, owned and
managed by a retail firm (usually manufacturer) for the purpose of selling
defected items, close outs, irregular, cancelled orders and season-end items.
These are off-price retail stores and are commonly known as factory outlets.
In India, they are usually found at the outskirts of the city, reducing storing,
operational and distribution expenses. They usually create threat to existing
retailers by offering heavy discounts. Some of the factory outlets are in
permanent covered sheds/locations and offer additional facilities such as parking,
restaurant, and recreational facilities.

The manufacturer has following reasons to have a Factory Outlet:

 It is the means to dispose off surplus, cancelled, out of fashion and
defected stock.
 As these are located outside the town, besides increasing firm‘s revenues,
does not affect the sales at manufacturers‘ department and specialty stores.

Features:
 Open seven days a week
 Long working hours
 Limited consumer service
 Less marketing efforts
 Out of the way location

4. Hyper Market: Hypermarkets are characterized by large store size, low

running costs and margins, low prices and very large range of merchandise. A
hypermarket usually is a very large retail unit offering merchandise at low prices
and combines various department stores. In India, hypermarkets have a floor area
of more than 50,000 sq. ft. These have their own multi-level spacious car parking
facility for their customers and employees. In fact, hypermarkets are giants that
offer long range of merchandise in varied quantity and quality under one roof.

Characteristics:
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  Low pricing,
 Convenience shopping,
 Comfort,
 Right quality,
 Quantity and price,
 Excellent service, and
 Wide product range.

Ex: Big Bazaar and Reliance Retail are two major hypermarket chain
stores. Bharti-Wal-Mart is the new entrant in this category.

5. Departmental stores: A department store (Traditional Departmental Store) is

a large retail outlet that offers a large variety and deep assortment and is
organized into separate departments for the purpose of selling, display and
promotion, customer service and control. Each department sells unique products
and has its own selling, accounts, packaging and security staff.

Characteristics:
 It must employ minimum 50 people as store staff.
 Most selling goods relate to FMCG and daily used items.
 It should have proper balance between home furniture, consumer
electronics, apparel and food.
 All the departments should generate balance contribution towards sales.
For instance, not more than 80% of annual sales can come from single
product line.
 In India, apparel and furnishing are two common categories in most of the
department stores. The major Indian department stores like Ebony,
Shopper‘s Stop, Westside, Music World, Globus and Lifestyle deal in
women‘s, men‘s, kids‘ clothing, furniture, jewelry, kitchenware and
furnishing.

6. Membership Club Retailing: Warehouse club stores usually sell merchandise

in fixed quantities at low prices. These stores require that their customers should
take their membership and visit their stores. The products offered are food items,
grocery, and clothing with an array of consumer electronic items that vary from
season to season. Customer service is nominal due to low price policy.

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 7. Parasite store: A parasite store is a small store/outlet, which neither has
neither its own floor area nor its own customer traffic. The size, nature and timing
of these stores, depend on people/ visitors who are drawn to that location for their
own reason. The reason for their visit may be to meet government officials,
attending a Seminar or Conference in a Hotel, or Railway/Airline booking.
Parasite store depends on existing traffic flow of a shopping centre or retail
business area. Customers visit these stores not because of its sales promotion
efforts, customer service, store image and merchandising efforts, but the
circumstantial visits made by the customers to these hosts (shopping complexes,
malls, hotels, government offices, public places or railway/Metro stations).

Characteristics:
 It does not have its own trading area.
 It does not have its own customer traffic flow.
 Its activities are dependent on the main host;
 It usually has less/no competition within the host area.
 It has limited product range.

Ex: A Coffee Parlour in a Shopping Centre,

A Magazine and Newspaper Stall in a Hotel Lobby and
A Hair Saloon/Beauty Parlour in a PVR Cinema Complex

8. Destination Store: The destination store, as the name implies, is the retail
store where customers make a special visit for the purpose of shopping. The main
philosophy behind the destination store lies because of its uniqueness in terms of
merchandise assortment, way of presentation, ambience, pricing and customer
service.

Ex: McDonalds

III Non-Store based retailing - Traditional:

The ultimate form of retailing directly to the consumer is non-store retailing. A
direct relationship with the consumer is the basis of any kind of non-store retail venture.
It can be broadly classified as direct selling and direct response marketing.

While direct selling involves direct personal contact, in direct response

marketing, the customer becomes aware of the products/services offered through a non
personal medium like mail, catalogues, phone, television or the internet.
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 1. Direct marketing/Direct response marketing: Direct marketing is an
interactive system of marketing that uses one or more advertising media to affect
a measurable response at any location. A direct relationship with the consumer is
the basis of direct marketing. In direct marketing, customers become aware of the
products/services offered through a non-personal medium like TV, internet, mail,
phone or catalogue etc.

Examples of such marketing include telemarketing, email, voicemail marketing,

door-to-door selling etc.

Direct response marketing: This includes various non-personal forms of

communication with the consumer and this includes:

Mail order retailing: This form of retailing eliminates personal selling and store
operations. Appropriate for speciality products, the key is using customer data
bases to develop targeted catalogues that appeal to narrow target markets. The
basic characteristic of this form of retailing is convenience.

Television shopping: Asian Sky Shop was among the first to introduce television
shopping in the India. In this form of retailing, the product is advertized on
television, details about the product features, price and things like
guarantee/warranty are explained. Phone numbers are provided for each city,
where the buyer can call in and place the order for the product. The products are
then home delivered.

Electronic Shopping: It allows the customer to evaluate and purchase the

products from the comfort of their home. The success of this form of retailing
largely depends on the products that are offered and the ability to the retail
organization to deliver the product on time to the customer. Strong supply chain
and delivery mechanisms need to be in place for this to be a success. Many
retailers are opting for click and mortar, where while having a brick and mortar
retail store, they also sell some of their products or ranges on the internet.

2. Direct Selling: It is a retail format where salesperson makes a personal contact

with the ultimate consumers at his home or at his/her place of work. Women
comprise up to 70% of all sales people in India. Direct selling may follow the
party plan or the multi level network. In the party plan, the host invites friends
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 and neighbors for a party. The merchandize id displayed and demonstrated in the
party atmosphere and buying and selling takes place. In the multi level network,
customers act like master distributors. They appoint other people to work with
them as distributors. The master distributor earns a commission on the basis of
the products sold and distributed by the distributors.
Ex: Amway: Health and home care products, Avon: Cosmetics/personal care,
Silpada: Jewllery, Mary Kay: Cosmetics/personal care.

3. Vending machines: This is a form of non store retailing in which the products
are stored in a machine and dispensed to the customers when they deposit cash.
Vending machines are placed at convenient and busy locations like air ports,
shopping malls, working place etc. This machine primarily contains products like
chocolates, snacks and drinks etc.

Benefits:
 Time saving shopping
 Absence of physical presence
 Space saving shop
 Quick delivery and non-store format.

4. Catalogue Marketing: It is form of direct marketing where the seller prepares

catalogues of merchandise or products and sells directly to the customer. The
catalogues are generally in printed form but can also be distributed in the form of
CDs. To avoid printing and distribution costs, the catalogues are being
increasingly made available online. Products from various companies or vendors
may be combined into a single catalogue to provide a one shop point for customer
looking out for a particular type of product.

Ex : Avon is a good example of a company successfully leveraging this channel

to sell its range of cosmetics.

Non-Store based retailing- Nontraditional:

1. Electronic Shopping: Online shopping (sometimes known as e-tail from
"electronic retail" or e-shopping) is a form of electronic commerce which
allows consumers to directly buy goods or services from a seller over the
Internet using a web browser. A broad range of customized designs with a
variety of style and utility features are available for electronic shopping.

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 Two systems are used under internet retailing:
 Passive retail system: This system is non-interactive and involves all
forms of one-way communication such as clubs on television, shopping
pages or one-way cable system. This system includes video catalogues
or electronic media, which display the products in use or provide other
relevant information.
 Interactive system: This system is interactive and allows the user a
two-way interaction and includes World Wide Web (WWW) or Kiosks
for items such as airline or railway ticketing and promotional touch
screen booths.

2. Video Kiosks: The video kiosk is a self-supporting, interactive, electronic

computer terminal that displays goods and services on a video screen and permits
the viewer to make selections. It uses touch screen for consumers.

Benefits:
 Anytime any where information providers.
 Cost saving device.
 Customer Savvy.
 Self service device/terminal.
 Convenient access to products and services.

Types of Kiosks: Financial services kiosk, Instant print stations, Movie ticket
kiosk, vending kiosk, visitor management and security kiosk.

3. Airport retailing: This offers one of the most promising sectors for retail
development. It offers branded luggage, clothing and items of decoration. Food,
toys, consumer sells, electronics are other specialized segments. Ex: Dubai
International has been the world's leading (based on total sales) duty-free retailer
for a couple of years now. Alcohol, perfumes and gold are the must-buys in the
Sheikh Rashid Terminal (also known as the Concourse), home to the majority of
the shops. Open 24/7, there's 5,400 square metres of retail heaven.

EMERGING TRENDS IN RETAIL FORMATS

1. Van /mobile van retailing: In this type of retail business retailers keep one day stock
of his merchandise and goes to an area to serve its permanent customers. They may visit
new areas to attract new customers. The product sold might include everyday household
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products to different kinds of eatables. There are some vans which designed to operate
at extremely low temperatures. We can find all kinds of frozen food such as vegetables
meat dairy products and ice.
Van retailing is usually found in remote /rural areas and is of two types:
 Static retailing: Under this sort of retailing, such vans are parked in public areas
where customers traffic is usually high .the items sold are snacks $ junk foods.
 Raving retailing: Is where retailers take his van to one house to another, selling
merchandise to customers at their doorstep.

2. Conference /party /event retailing: In this sort of retailing, retailer invite people
from nearly localities and after describing positive aspects of merchandise, sells it.
Example gold retailing on the day of ―Akshaya Thirithi‖ in most of the parts of the
country is one of such example of event retailing.

3. Distant retailing: Here a customer place the order from a remote location by
telephone, sms, internet, paper etc. instead of visiting a store.

Example: Amazon
The main advantage of such sort of retailing is that any type of item can be supplied
by the retailer on demand.

4. Forecourt retailing: Establishments of stores in front of large buildings of high

traffic areas.

Example: Apollo pharmacy had tied up and set up ―convenio ―stores at Indian oil
corporation petrol pump outlets for supplying groceries and medicines.

5. Trade parks: Under this concept ,business complexes are being set up for promotion
of retail trade especially the international trade.

Example: Indian exposition mart set up by handicraft export promotion council in

greater Noida.

MNC’S ROLE IN ORGANISED RETAIL FORMATS

A Multinational corporation has been defined as follows: An Enterprise which own
or control production or service facilities outside the country in which they are based.
The role of MNC‘s in organized retail format is explained as:

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 Capital: Capital the means of production is the basic need of any retailing
format. It allows for the improvement in the structure of the economic system
.through foreign direct investment (FDI), MNC‘s are able to diffuse the much
needed resource into developing countries.
 Technology: It is also brought into the country with the MNC ,the movement of
technology to produce goods as well as for communication purposes.
 Example: The privatization of the petrochemicals sector of Brazil in the early
1990‘s led to a greater acceptance of environmentally safe practices.
 Skills: The skill level of the workers within the host country would also increase
because many MNC‘s can and do educate them in the job skills needed to
produce efficiently benefiting both the firm and the host country.
 Exports: The number of exports of the host country will grow exceptionally well
.Their Gross domestic product and gross national product will also reflect the
growth of industry.
 FDI through MNC’s is for easier: FDI through MNC‘s is for easier to attain
than multilateral bank lending because there are so many firms looking for
opportunities for optimizing profits.

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