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Introduction to Retailing
INDIAN RETAIL MARKET SIZE
INDIAN RETAIL MARKET SIZE
• The Overall Retail market is set to cross the $ 1.7 tn mark by 2020
from $795 bn in 2017.
• India’s e-commerce market is also set to grow at a CAGR of 30% for
gross merchandise value to be worth $ 200 bn by 2026.
• India ranks among the best countries to invest in Retail space.
Factors that make India so attractive include the second largest
population in the world, a middle class of 600 mn people,
increasing, urbanization, rising household incomes, connected
rural consumers and increasing consumer spending.
• India ranked No. 2 in Global Retail Development Index (GRDI) in
2019.
• Retail is India's largest industry, currently accounting for over 10%
of the country's GDP and 8% of total employment.
• The unorganized retail accounted for about 88% of the total retail
revenue, organized 9% & E-tailing 3%.
RETAILING
• According to Kotler: “Retailing includes all the
activities involved in selling goods or services
to the final consumers for personal, non
business use”
• It includes every sale to the final consumer –
ranging from cars to apparel to meals at
restaurants to movie tickets.
RETAIL MANAGEMENT
• The various processes which help the
customers to procure the desired
merchandise from the retail stores for their
end use refer to retail management.
• Retail management includes all the steps

required to bring the customers into the store
and fulfill their buying needs.
Importance of Retailing
• The retailer is an intermediary in the marketing
channel and is an important connecting link in a
complex mechanism of marketing
• He is both marketer and customer
• He is a specialist who maintains contact with the
consumer and the producer.
• Direct selling is inconvenient, Expensive and time
consuming as compared to the job performed by
a specialist in the line.
Economic Significance of Retailing
• All middlemen basically serve as purchasing agents for their
customers and as sales specialists for their suppliers.
• To carry out those roles, retailers perform many activities,
– including anticipating customer's wants,
– developing assortments of products,
– acquiring market information and
– financing.
• There are just over a 6 million retail outlets across India.
• Retailers serve and satisfy the same market segments, which results
in fierce competition and better values for shoppers.
• The essence of retail marketing is developing merchandise and
services that satisfy specific needs of customers, and supplying them
at prices that will yield profits.
Competitive structure
Competitive structure
• The main growth drivers in the organized retail market in India.
– Improving economy,
– Changing demographic profile,
– Increasing disposable incomes in hands of the middle class,
– Growing spread of plastic money & easy availability of credit
– Changing tastes and preferences,
– Brand awareness and growing urbanization
– Rising discretionary spends
• Modern retailing in India has entered in form of huge malls and

super markets offering shopping, entertainment, leisure to the
consumer
• How ever kirana shops still continue to score over modern formats
primarily due to the convenience factor.
RETAIL
FORMATS
Conventional Retail formats
 Products available in shanties
 Small mobile retailers: products available on
handcarts, bicycles etc
 Small shops which got converted to bazaars
Store formats by merchandise
Department
Family store Specialty Store Super Market
store
• Apparel for • Narrow product • More than • Food,grocery
whole family line with good 10000 sq • Limited non
• Eg Shoppers depth ft,more than food items
Stop • Attentive 100000 SKU, • >3000 sq ft and
customer Several 30000 SKUs
service departments,a
• D Mart
• Eg Park pparel,electron
Avenues by ics,cosmetics
Raymonds etc
• Each section
functions as a
separate SBU
• Eg Shoppers
Stop
Store formats by size
Shopping
Super store Shopping mall Hyper Market
centre
• Large, food • Retail and • More than 5 • Food,grocery
and non food leisure shops each • Pharmacy,flori
items. Twice • More than approx 1000 sq st,photo shop
the size of 200000 sq ft ft cds etc
supermkt and runs as an • >200000 sq ft
,offers non integrated ,large qtys in
traditional business by a each category
goods and single owner at low margins
services such • Eg Park • Metro
as Avenues by
pharmacy,flori Raymonds
st,bakery under
one roof
• Eg Shoprite
Store formats by price
Single price
Discount/baza Category denomination
EDLP Warehouse
ar format killer format
• Discounts at • Every day • Large • large sale • Scrambled
25% below low pricing specialty of discounted merchandis
or prices • Found more store with an merchandis e at a single
below MRP. in Western enormous e by an low price
• MFGS countries selection of individual or point
overruns,irre its product orgnaization • Dollar shops,
gulars,unsol category at in free Rs49/99
d from last low prices access shops
season ambience of
• Eg Parel an
warehouse
• Both width
and depth of
retailed
merchandis
e
Store format by ownership
 Franchisee format: owned and operated by
individuals on behalf of and licensed by a large
organization
 Independent store: owned by a single person or a
partner
 Chain Stores: When multiple outlets are under
common ownership it is called a chain of stores.
 Consumers Co-Operative Stores: These are
businesses owned and run by consumers with
the aim of providing essentials at reasonable cost
as compared to market rates.
Store format by concessions
 Stopover format: piggybacks on other retail
outlet eg crosswords at petrol pumps, In and
out at BPCL
 Kiosks: placed in mall, airports, etc. used for
information, sales and promotion. Eg HT at
airports free copies
UNORGANIZED
RETAIL
FORMATS.
Unorganised
Formats
Haats
Mandis.
Fairs
Hawkers
Flea markets
Mom and pop stores
Haats, mandis.
• Mandi in Hindi language means
market place.
• Mandi assumes the contours of a
catch-all market place where
anything is bought and sold.
Fair
• A fair is a gathering
of people for a
variety of
entertainment or
commercial
activities.
• it is temporary with
scheduled times
lasting from an day
to few week.
Hawkers
A hawker is an individual who sells
wares by carrying them through the
streets.
A peddler is defined as a retail dealer

who brings goods from place to
place, exhibiting them for sale.
Flea markets
A flea market (or swap meet) is a type
of bazaar that rents or provides space to
people who want to sell or barter
merchandise. Used goods, cheap items,
collectibles, and antiques are commonly
sold.
Flea markets can be held annually or semi-

annually, monthly, on weekends, or daily.
Mom and pop
stores
"Mom and pop" is the term
used for businesses and
companies that are
independently owned and
run.
Kirana store, a small

neighborhood retail store in
the Indian Subcontinent.
Retail marketing mix
• Retail marketing mix is the term used to describe
the various elements and methods required to
formulate and execute retail marketing strategy.
• Retail managers must determine the optimum
mix of retailing activities and co-ordinate the
elements of the mix.
• The aim of such coordination is for each store to
have a distinct retail image in consumers’ mind.
The retail marketing mix
Place (store location) Product (merchandise)
•Target market •Product management
•Channel structure •Product assortment
•Channel management •Branding
•Retailer image •Packaging
•Retail logistics •After-sales services
•Retail distribution
Price Promotion
•Costs •Developing promotional mixes
•Profitability •Advertising management
•Value for money •Sales promotion
•Competitiveness •Sales management
•Incentives •Public relations
•Quality •Direct marketing
•Status
People element Process element
•Staff capability •Order processing
•Efficiency •Database management
•Availability •Service delivery
•Effectiveness •Queuing system
•Customer interaction •Standardisation
•Internal marketing
Retail Marketing Mix
• While many elements may make up a firm’s
retail marketing mix, the essential elements
may include:
• Personal selling
• Store location,
• Store image
• Merchandise assortments
• Store design
• Store ambience,
• Sales incentives
• Customer service,
• People
• Price,
• Process
• Communication with
• Physical evidence
customers
The role of the retail buyer
• They select and order merchandise to be sold which
directly affects the sales volume of their store and its
share of the total retail market. They play following
roles
– 1) Developing the merchandising strategies for the
product line, store or organization
– 2) Planning and selecting merchandise assortments.
– 3) Vendor selection, negotiations, development and
management.
– 4) Pricing the merchandise to achieve the required targets
in terms of gross margins.
– 5) Inventory management
– 6) Allocation of merchandise to the various retail stores
Work of the buying office /
merchandise department
• Merchandisers are responsible for ”everything that
happens to a product from the moment it is delivered to
the store to the moment a shopper picks it up off the
shelf”.
• Work include:
– Collaborating with suppliers, manufacturers, and stores to
ensure proper execution of plans
– Creating and organizing promotions and advertising campaigns
– Managing layout plans of store and maintain inventory of
products
– Gathering information on market trends and customers’
reactions to products
– Analyzing sales figures - reporting growth, expansion, and
change in markets

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MODULE 01

• Retail management includes all the steps

• Modern retailing in India has entered in form of huge malls and

A peddler is defined as a retail dealer

Flea markets can be held annually or semi-

Kirana store, a small

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