100307189 Operations at Retail Industry BIG BAZAR

7/24/2019 100307189 Operations at Retail Industry BIG BAZAR

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ACKNOWLEDGEMENTI would like to thank the teaching staff of the Specialization team of Operation

department for their successful completion of our project.

I am thankful to our project guide Prof. Vaibhav pawarwhose continuous

encouragement and support me to work and manage the project in best possible

manner.

With sincere gratitude for all the knowledge, experience that I had gained within

short period of time, I am eternally grateful to the person who had helped me in

making my project successful.

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1. Objective of the t!"# o Study of Operational !anagement in "ig "azaar

o study the emergence of #etailing in India.

o understand the perception of people about retailing.

o understand people$s acceptance and willingness to subscribe to by in mall %

"ig "azaar

o study the latest trends in !aha "achat "ig "azaar offer % &'((

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$. %#pothe&i& he following are the hypotheses of this project)

*eople are +uite aware about retailing in mall culture.

*eople are to buy in "ig "azaar

*eople are willing to spend more !aha "achat by "ig "azaar.

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'. Metho"o(o)#

Data Co((ectio* Metho"

Pri+ar# Data

he data was collected by drafting a +uestionnaire and thereby interpreted or

analyzed by using the !icrosoft xcel. he prominent features of the

+uestionnaire were)

he +uestionnaire contained a set many research structured and organized

+uestions.

he conclusions were drawn according to their -iews and opinions he

+uestionnaire, multiple choice +uestions /lternati-e Options listed0 #esearch is done along with beha-ior of customer for Organized retailing 1

2norganized retail

eco*"ar# "ata

Secondary data was collected by the means of 3ewspapers, Internet,

#eports, !agazines and "ooks.

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4. E,ec!tive !++ar#

5emographics continue to show a positi-e report to spur retailing growth. 6onsumers aged

&'748 years is emerging as the fastest growing consumer group and the mean age of

Indians is now pegged at &9, a mean age that reinforces spending across all the retailing

channels of grocery, non7grocery and non7store.

he go-ernment stance of protecting local retailers and prohibiting ('': foreign direct

in-estment in retailing continued, restraining international retailers; entry.


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-. *tro"!ctio*

India$s retail market which is seen as 5!I3 by global players has grabbed

attention of the most de-eloped nations. his is no wonder to the one who knows that

the total Indian retail market is 2S ?@8'bn. (A, '',''' crore I3# approx.0 of which

organized retailing is only around @ percent i.e. 2S ?Bbn @A,''' crore I3# approx0.

C#etailing includes all acti-ities in-ol-ed in selling goods or ser-ices directly to final

consumers for personal, non7business use. / retailer or retail store is any business

enterprise whose sales -olume comes primarily from retailing.D #etail is India;s largest

industry, accounting for o-er (' per cent of the country;s =5* and around eight per cent

of the employment. #etail industry in India is at the crossroads. It has emerged as one

of the most dynamic and fast paced industries with se-eral players entering the market.

he presence of (8million kirana stores brings into light the -ery fact that the Indian

retail industry is highly fragmentedE unorganized. #etailing in India is gradually inching

its way toward becoming the next boom industry, organized retailing in particular. he

whole concept of shopping has altered in terms of format and consumer buying

beha-ior, ushering in a re-olution in shopping in India. !odern retail has entered India

as seen in sprawling shopping centers, multi7storeyed malls and huge complexes offer

shopping, entertainment and food all under one roof.

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he future of Indian retailing may e-en witness the concept of &4 hour retailing. -en

though this concept has been in existence in few retail segments like pharmaceuticals

and fuel, it still remains to be a challenge for other segments like food and groceries,

apparel etc to adopt this trend.

/lthough the organized retailing in India is coming up in a big way, it cannot simply

ignore the competition from the con-entional stores because of -arious factors like

reach, extending credit facility and other intangible factors like the human touch which

are pro-ided only by the con-entional stores.

he urban retail market has been embracing -arious new formats and the malls turned

out to be the trend setters by promising the concept of shoppertainment. he trends in

the rural market also ha-e been changing from the old


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-.1 What i& /etai(0

he word ;retail; is deri-ed from the Grench word ;retaillier; meaning ;to cut a piece off; or

;to break bulk;. In simple terms it in-ol-es acti-ities whereby product or ser-ices are sold

to final consumers in small +uantities. /lthough retailing in its -arious formats has been

around our country for many decades, it has been confined for along time to family

owned corner shops.

nglishmen are great soccer enthusiasts, and they strongly think that one should ne-er

gi-e Indians a corner. It stems from the belief that, if you gi-e an Indian a corner he

would end up setting a shop. hat is how great Indians retail management skill is

considered.

The act&

#etailing in more de-eloped countries is big business and better organized that what it

is in India. #eport published by !cHinsey 1 6o. in partnership with 6onfederation of

Indian Industry 6II0 states that the global retail business is worth a staggering 2S ? 9

trillion. he ratio of organized retailing to unorganized in 2S is around B' to &', in

urope it is 9' to @', while in /sia it comes to around &' to B'.

In India the scenario is +uiet uni+ue, organized retailing accounts for a mere 8: of the

total retail sector. /lthough there are around 8 million retail stores in India, ': of these

ha-e a floor space area of 8'' s+.ft. or less. he emergence of organised retailing in

India is a recent phenomenon and is concentrated in the top &' urban towns and cities.

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The /ea&o*2

his emergence of organized retailing has been due to the demographic and

psychographic changes taking place in the life of urban consumers.

=rowing number of nuclear families, working women, greater work pressure, changing

-alues and >ifestyles, increased commuting time, influence of western way of life etc.

ha-e meant that the needs and wants of consumers ha-e shifted from just being 6ost

and #elationship dri-e to "rand and xperience dri-en, while the Jalue element still

dominating the buying decisions.

-.$ G(oba( ce*ario

#etail stores constitute &': of 2S =5* 1 are the @ rd largest employer segment in

2S/.

6hina on the other hand has attracted se-eral global retailers in recent times. #etail

sector employs 9: of the population in 6hina. !ajor retailers like Wal7!art 1 6arrefour

ha-e already entered the 6hinese market. In the year &''@, Wal7!art 1 6arrefour had

sales of 2S ? 9'.4 6rore 1 2S ? (A' 6rore respecti-ely.

he global retail industry has tra-eled a long way from a small beginning to an industry

where the world wide retail sales is -alued at ? 9 x (' 8 6rore. he top &'' retailers

alone accounts for @' : of the worldwide demand. #etail turno-er in the 2 is

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approximately uros &,'',''' 6rore and the sector a-erage growth is showing an

upward pattern. he /sian economies excluding Kapan0 are expected to grow at A:

consistently till &''87'A.

On the global #etail stage, little has remained same o-er the last decade. One of the

few similarities with today is that Wal7!art was ranked the top retailer in the world then

1 it still holds that distinction. Other than Wal7!art;s dominance, there;s a little about

today;s en-ironment that looks like the mid7('s. he global economy has changed,

consumer demand has shifted 1 retailers; operating systems today are infused with far

more technology than was the case six years ago.

-.'ce*ario of /etai(i*) i* *"ia

#etailing is the most acti-e and attracti-e sector of last decade. While the retailing

industry itself has been present since ages in our country, it is only the recent past that it

has witnessed so much dynamism. he emergence of retailing in India has more to do

with the increased purchasing power of buyers, especially post7liberalization, increase

in product -ariety, and increase in economies of scale, with the aid of modern supply

and distributions solution.

Indian retailing today is at an interesting crossroads. he retail sales are at the highest

point in history and new technologies are impro-ing retail producti-ity. though there are

many opportunities to start a new retail business, retailers are facing numerous

challenges.

KE3 C%ALLENGE2

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(0>O6/IO3)

4

/i)ht P(ace5/i)ht choice6

>ocation is the most important ingredient for any business that relies on customers, and

is typically the prime consideration in a customer$s store choice. >ocations decisions are

harder to change because retailers ha-e to either make sustainable in-estments to buy

and de-elop real estate or commit to long term lease with de-elopers. When formulating

decision about where to locate, the retailer must refer to the strategic plan.

&0 !#6


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growing because today;s customers are looking for good -alue when they buy

merchandise and ser-ices. *rice is the easiest and +uickest -ariable to change.

40/#=/25I36)

L6onsumer the prime mo-erL

L6onsumer *ullL, howe-er, seems to be the most important dri-ing factor behind the

sustenance of the industry. he purchasing power of the customers has increased to a

great extent, with the influencing the retail industry to a great extent, a -ariety of other

factors also seem to fuel the retailing boom.

80 S6/> OG O*#/IO3)

Scale of operations includes all the supply chain acti-ities, which are carried out in the

business. It is one of the challenges that the Indian retailers are facing. he cost of

business operations is -ery high in India

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Let !& (oo7 at the evo(!tio* proce&&)

5etailing reasons why Indian organized retail is at the brink of re-olution, the I!/=S7

HS/ report says that the last few years ha-e seen rapid transformation in many areas

and the setting of scalable and profitable retail models across categories. Indian

consumers are rapidly e-ol-ing and accepting modern formats o-erwhelmingly. #etail

Space is no more a constraint for growth. India is on the radar of =lobal #etailers and

suppliers E brands worldwide are willing to partner with retailers here. Gurther, large

Indian corporate groups like ata, #eliance, #aheja, I6, "ombay 5yeing, !urugappa

1 *iramal =roups etc and also foreign in-estors and pri-ate e+uity players are firming

up plans to identify in-estment opportunities in the Indian retail sector. he +uantum of

in-estments is likely to skyrocket as the inherent attracti-eness of the segment lures

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more and more in-estors to earn large profits. In-estments into the sector are estimated

at I3# &''' 7 &8'' 6rore in the next &7@ years, and o-er I3# &',''' 6rore by end of

&'('.

Gew of India;s top retailers are)

(. 8i) 8a9aar:Pa*ta(oo*&2"ig "azaar, a di-ision of *antaloon #etail India0 >td is

already India;s biggest retailer. In the year &''@7'4, it had re-enue of #s A8B.@( crores

1 by &'('M it is targeting re-enue of #s B,B'' 6rore.

$. oo" Wor("2Good World in India is an alliance between the #*= group in India with

5airy Garm International of the Kardine !atheson =roup.

'. Tri*ethra 2It is a supermarket chain that has predominant presence in the southern

state of /ndhra *radesh. heir turno-er was #s 9B.B 6rore for the year &''&7'@.

;. Ap*a 8a9aar2It is a #s (4'7crore consumer co7operati-e society with a customer

base of o-er (& lakh, plans to cater to an upwardly mobile urban population.

-. Mar)i* ree2It is a Herala based discount store, which is uniformly spread across

&4' !argin Gree franchisees in Herala, amil 3adu and Harnataka.

Wholesale trading is another area, which has potential for rapid growth. =erman giant

!etro /= and South /frican Shoprite


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-olumes from a sizeable number of retailers who do not ha-e to maintain relationships

with multiple suppliers for all their needs.

-.; /ETAL O/MAT2

%#per+ar7et) It is the largest format in Indian retail so far is a one stop shop for the

modern Indian shopper.

!erchandise) food grocery to clothing to spots goods to books to stationery.

Space occupied) 8'''' S+ .ft. and abo-e.

SH2s) &''''7@''''.

xample) *antaloon retail$s "ig "azaar, #*=$s Spencers =iant0.

!per+ar7et) / subdued -ersion of a hypermarket.

!erchandise) /lmost similar to that of a hypermarket but in relati-ely smaller

proposition.

Space occupied) 8''' S+. ft. or more.

SH2s) /round (''''.

xample) 3ilgiris, /pna "azaar, rinethra.

Co*ve*ie*ce &tore) / subdued -ersion of a supermarket.

!erchandise) =roceries are predominantly sold.

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Space occupied) /round 8'' S+. ft. to @''' S+. ft.

xample) stores located at the corners of the streets, #eliance #etail$s Gresh and

Select.

Depart+e*t &tore) / retail establishment which specializes in selling a wide range of

products without a single prominent merchandise line and is usually a part of a retail

chain.

!erchandise) /pparel, household accessories, cosmetics, gifts etc.

Space occupied) /round ('''' S+. ft. % @'''' S+. ft.

xample) >andmark =roup$s >ifeStyle, rent India >td.$s Westside.

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Di&co!*t &tore) Standard merchandise sold at lower prices with lower margins and

higher -olumes.

!erchandise) / -ariety of perishableE non perishable goods.

xample) Jiswapriya =roup$s Subiksha, *iramal$s ru!art.

pecia(t# &tore) It consists of a narrow product line with deep assortment.

!erchandise) 5epends on the stores

xample) "ata store deals only with footwear, #*=$s !usic World, 6rossword.

M8O


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Space occupied) #anges from A',''' s+ ft to 9, '',''' s+ ft.

xample) *antaloon #etail$s 6entral, !umbai$s Iorbit.

he percentage of organized retail per sector wise is -ery miniscule and this does not

mean that there is stagnation of growth because if we look at the following table we can

clearly obser-e the burgeoning pace of growth happening in all the sectors of Indian

retailing.

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he organized retail industry is growing at &87 @' percentage and is expected to

reach the mark of (, '',''' crore I3# by &'(' from the present figure of @8,''' crore

I3# approx. With such a mouth watering figures the organized retailing has been

attracting many players and e-en persuading the existing retailers to expand and

experiment with newer formats. his can also be substantiated by looking the estimation

of the organized retail space to be around 9& million s+ ft. by the end of &''9. he

present players and their retail formats details are presented below)

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Tre*"& i* Pre&e*t /etai( Mar7et2

New Pro"!ct Cate)orie&2

Gor a long time, the corner grocery store was the only choice a-ailable to the

consumer, especially in the urban areas. his is slowly gi-ing way to international

formats of retailing. he traditional food and grocery segment has seen the emergence

of supermarketsEgrocery chains Good World, 3ilgiris, /pna "azaar0, con-enience

stores 6on-eniO, ifeStyle, Westside0, apparelEaccessories *antaloon, >e-is, #eebok0, booksEmusicEgifts

/rchies, !usicWorld, 6rosswords, >andmark0, appliances and consumer durables

Ji-eks, Kainsons, Jasant 1 6o.0, drugs and pharmacy ifestyle stores. Goreign retailers are keenly e-aluating the Indian

market and identifying partners to forge an alliance with in areas currently permitted by

regulations. With an estimated initial in-estment of 2S5 98' million, #eliance is

planning to launch a nationwide chain of hypermarts, supermarkets, discount stores,

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department stores, con-enience stores and speciality stores. hese 8,8'' stores will be

located in B'' cities and towns in India.

*crea&e i* Private Labe(&2

With the emergence of organized retail and modern retail formats, pri-ate labels

ha-e been gaining significance. hey enhance the profitability le-els of product

categories, increase retailers$ negotiation powers and create consumer loyalty. !ore

retailers are introducing their own brands in all categories including Good 1 =roceries,

apparel, accessories, footwear. hese own brands also do not ha-e to manage

intermediaries since retailers maintain o-ersight of the supply chain.

he label penetration is in a huge rise. *ri-ate >abel penetration has been on a

rise. It is mainly growing among G!6= products in most supermarkets with groceries

accounting for 48.:

E,pa*"i*) to Tier a*" citie&2

Indian retailers are planning to extend operations into ier II and ier III cities as

heightened I offshoring acti-ity in these locations ha-e increased consumers$

disposable income. he population in these cities is typically well educated and willing

to purchase goods and ser-ices. Some major retailers, like =lobus, #eliance #etail and

*antaloon, ha-e already begun building a retail presence in ier III cities before many

retailers ha-e finalized their ier II retail operations.

ora# i*to /etai( A)ri:8!&i*e&&2

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India$s most prestigious business houses and global retailers are planning to

enter retail agri7business. !arket entrants plan to in-est in the entire -alue chain,

mo-ing goods Cfrom the farm to the fridge at home.D Jiewed as India$s next CSunrise

Sector,D retailers are employing contract farming as a means of boosting their -entures.

6ontract farming enables farmers to access land, manpower and farming skill without

ha-ing to purchase land. Of the total 6ulti-able land of 4'' million acres in India,

contract farming represents 9 million acres thus indicating a tremendous opportunity.

Gor pure corporate contracts between farmers and companies, only &,'',''' acres are

used.

E,peri+e*ti*) with for+at&2

Selecting the right retail format is essential in modern retailing. he difference

between urban and rural customers is one of the reasons why multiple formats are

re+uired in India. >ocal conditions and insights into buying7beha-iour shape the format

choice. 3o single format will be suitable for an all India strategy and selecting the

rele-ant format is the key success factor.

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8i) 8a9aar to offer &i,:"a# +aha:bachat fro+ A!) 11

"ig "azaar, the largest chain of hypermarkets from Guture =roup, has once again come

up with their special Independence 5ay offer of F!ahabachat$ for six days from /ugust

(' to /ugust (8, &'(( at its all (8@ "ig "azaar outlets across the country.

LWith an aim to pro-ide the best shopping deals and sa-ings to consumers in today$s

age of inflation, "ig "azaar is all set to make this year$s Independence 5ay shopping

truly memorable with the best deals and mega offers leading to great sa-ings. /part

from "ig "azaar stores, F!ahabachat$ offers will also be a-ailable at all major sub7

formats such as Good "azaar, Gurniture "azaar,


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you can a-ail discounts, offers, freebies and exclusi-e deals on almost all the products

sold at "ig "azaar. his offer is also -alid on at their online website

bigbazaar.futurebazaar.com.

= Da#& Maha avi*)& Offer

his A 5in !ahabachat sale is -alid at all the "ig "azaar Stores in India and is

applicable on electronics, clothing, accessories, food, cosmetics, kitchenware, mobile

phones, >65 Js, etc. his is also the part of their pre-ious offers namely Sabse Saste

offers and the most important sale days for "ig "azaar, this Independence 5ay Offer, in

terms of sales compared with the whole year. he gates will be open from a.m.

onwards during this exclusi-e sale period. his offer is -alid on Good "azaar, Gurniture

"azar, lectronics "azaar, Gashion, etc, at "igbazaar.

pecia( Offer&

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5aawat 5e-aaya "asmati #ice 8 kg *illsbury /tta 8kg =old Winner

Sunflower Oil 8 > is priced at #s. A as against #s. ((&80.

Gortune Sunflower Oil 8 > Sugar 8 Hg *illsbury /tta 8 Hg for #s. AAA as

against #s. A8.

!en$s formal, casual and party wear shirts priced #s. 479, buy & for #s. 9

and buy @ for #s. ('.

/kai @& inch >65 J with 2S" !o-ie and 4'' W sound output for just #s.

(8,A'.

"uy *restige 4 burner glass top gas sto-e *rice #s. B'480 and get *restige

!ixer =rinder, 8 > pressure cooker and @ pieces non7stick tawa set worth #s.

AA'' for free.

"uy Samsung mobile &&&& and Gly 5S ('A for just #s. @8. /lso you will get a

chance to win bike, car, and >65 Js on purchase of mobile phones.

ree $; KG !)ar

If you can shop for just #s. 4 and abo-e you can a-ail &4 kg sugar but in the form of

sugar coupons which can be redeemed against future purchases. Pou will be issued

with (& sugar coupons. hese coupons can be redeemed on a minimum purchase of

#s. 4 and more during the Wednesdays only from /ugust (9 to 3o-ember &, &'((.

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E(ectro*ic&

he Hodak 6(8 digital camera (4 !*, 8Q zoom0 is priced at #s. @'

/cer e!achines with @&' =" fridge and get free #eebok Watch

a&hio* Offer&

here are buy & get ( and flat 8': off offers on men$s, ladies and kids wear like kurta,

churidar, ladies western, kid$s wear boys and girls, and men$s jeans and trousers, etc.

%o+e Nee"&

"uy 3irlep non7stick kadai worth #s. 9 and get free a-a, adka *an and Grypan

R "uy *restige Induction cook top sto-e for #s. @8 and get free 8 pieces induction

cookware worth #s. 9A98.

R /lso a-ailable offers on super lock containers, Opalware and !elamine dinner set, etc.

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%o+e a&hio*

"uy ( and get ( free with the designer bed sheets. *ersian carpets a-ailable at 8(: flat

discount. #ecron pillows buy ( get ( offer.

Other Offer&

here are also daily needs or groceries offers at Good "azaar, on -arious brands like

#in, *epsi, ee 6ooper and I5 6asual

Shoes. Special offers is also a-ailable on luggage of flat 8': off on Skybags, Safari and

/ select range of soft trolleys. !ilestone 2nion Soft rolleys is priced at #s. @& for a

set of @ as against #s. A89. he offer is also applicable on kid$s toys range.

8!#i*) Tip

hese offers at "ig "azaar -aries from store to store as well as from city to another city,

so do check the same at your nearest "ig "azaar store to get the offer details

indi-idually on each stores. Spend wisely on such sales and find only the -ery genuine

offers and go for it during the time of such financial situation as not all offers are worthy

to go for, think twice before spending on the sameN 3e-er indulge in compulsi-e

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shopping lured by these offers as most of them are a-ailable e-en after the offer period

but some won;t as wellN So use this offer period to sa-e and not o-er spendN

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Mar7eti*) Mi, 8i) 8a9aar

"ig bazaar shopping mall is one of the finest shopping malls all o-er India. It is the most

liking mall who always prefers to shop for again and again.


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6are !ate

Horyo and 44 other brands.

Prici*)2

he pricing objecti-e at "ig "azaar is to get C!aximum !arket ShareD. *ricing at "ig

"azaar is based on the following techni+ues)

Va(!e Prici*) >EDLP ? Ever# Da# Low prici*)@2 "ig "azaar promises

consumers the lowest a-ailable price without coupon clipping, waiting for discount

promotions, or comparison shopping.

Pro+otio*a( Prici*)2 "ig "azaar offers financing at low interest rate. he

concept of psychological discounting #s. , #s. 4, etc.0 is also used to attract

customers. "ig "azaar also caters on Special -ent *ricing 6lose to 5iwali, =udi

*ad-a, and 5urga *ooja0.

Differe*tiate" Prici*)2 5ifferentiated pricing i.e. difference in rate based on

peak and non7peak hours or days of shopping is also a pricing techni+ue used in Indian

retail, which is aggressi-ely used by "ig "azaar.

e.g. Wednesday "azaar

8!*"(i*)2 It refers to selling combo7packs and offering discount to customers.

he combo7packs add -alue to customer and lead to increased sales. "ig "azaar lays a

lot of importance on bundling.

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http://www.marketing91.com/pricing/http://www.marketing91.com/bundling/http://www.marketing91.com/pricing/http://www.marketing91.com/bundling/


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e.g. @ =ood 5ay family packs at #s A'*rice of ( pack V #s &&0

8kg oil 8kg rice 8kg sugar for #s 8

P(ace2

he "ig "azaar stores are operational across three formats hypermarkets spread

o-er 4','''748,''' s+ ft, the xpress format o-er (8,'''7&',''' s+ ft and the Super

6enters set up o-er ( lakh s+ ft. 6urrently "ig "azaar operates in o-er @4 cities and

towns across India with ((A stores. /part from the !etros these stores are also doing

well in the tier II cities. hese stores are normally located in high traffic areas. "ig

"azaar aims at starting stores in de-eloping areas to take an early ad-antage before

the real estate -alue booms. !r. "iyani is planning to in-est around #s @8' crore o-er

the next one year expansion of "ig "azaar. In order to gain a competiti-e ad-antage "ig

"azaar has also launched a website www.futurebazaar.com, which helps customers to

orders products online which will be deli-ered to their doorstep. his helps in sa-ing a

lot of time of its customers.

Pro+otio*2

he -arious promotion schemes used at "ig "azaar include)

CSaal ke sabse saste @ dinD


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Guture card@: discount0

Shakti card

/d-ertisement print ad, J ad, radio0

"rand endorsement by !.S 5honi and /sin

"ig "azaar has come up with @ catchy lines written on hoardings taking on biggies like

Westside, Shoppers stop and >ifestyle. hey are)

CHeep West7 aSide. !ake a smart choiceND

CShoppersN Stop. !ake a smart choiceND

C6hange your >ifestyle. !ake a smart choiceND

Peop(e2

Well trained staff at stores to help people with their purchases

mploy close to (',''' people and employ around 8'' more per month.

Well7dressed staff impro-es the o-erall appearance of store.

2se scenario planning as a tool for +uick decision making multiple counters for

payment, staff at store to keep baggage and security guards at e-ery gate, makes for a

customer7friendly atmosphere.

Proce&&2

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"ig "azaar places a lot of importance on the process right from the purchase to the

deli-ery of goods. When customers enter the stores they can add the products they

which to purchase in their trolley from the racks. here are multiple counters where bill

can be generated for purchases made. "ig "azaar also pro-ides deli-ery of products

o-er purchases of #s. ('''.

Ph#&ica( Evi"e*ce2

*roducts in "ig "azaar are properly stacked in appropriate racks. here are different

departments in the store which display similar kind of products. hroughout the store

there are boardsEwritten displays put up which help in identifying the location of a

product. !oreo-er boards are put up abo-e the products which gi-e information about

the products, its price and offers. "ig "azaar stores are normally F2 shaped$ and well

planned 1 designed

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XImage /bo-e) Lhe Heep West7aSide. !ake a smart choice NL "illboard on


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coke, pepsi, etc ha-e been using the same for +uite some time now and the latest

entrant is our -ery own F!t!re Gro!p$7 8i) 8a9aar5 Pa*ta(oo*&5 !t!re 8a9aar5

eo*e are all part of this group and they are taking on the biggies like Shoppers Stop,

>ifestyle, and ata$s Westside.

In order to do the same, Guture =roup ha-e come up with ' catch#Bcoc7# a*" chee7#

a" ca+pai)*which surely does catch your eyes whether one changes their loyalty or

not, only time will tell0 and surely one cant resist appreciating the same..

Keep We&t:ai"e. Ma7e a &+art choice

hopper& top. Ma7e a &+art choice

Cha*)e 3o!r Life&t#(e. Ma7e a &+art choice >ee +a)e 8e(ow@

3ot surprisinglyM according to the latest release in the campaign has made the

competition -ery uncomfortable because they somehow feel Cthe ads make a subtle

reference to themD.


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With retail market in India especially in metros where standard of li-ing and "i&po&ab(e

i*co+e i& at a* a(( ti+e hi)h, competitors will -ie for the market share and ca* &toop

to a*# (eve(& whi(e +ar7eti*) their pro"!ct&. =uerilla marketing is just one of the

strategies and surely one can learn a lot from the ongoing battle, especially people

interested in marketingEmarketing techni+ues.

hings ha-e already started to boil coz of this ad campaign and both Life&t#(e5

hopper& top are a*a(#9i*) the effect of the &trate)#used by !r "iyani and Guture

=roup. >ifestyle are e-en planning to take Guture =roup and their ad campaign to

A"verti&i*) ta*"ar"& Co!*ci( of *"ia/S6I0. I just feel, Guture =roup ha-e done a

-ery creati-e job and surely time will tell the effect of this strategy % by this I refer to both

Guture =roup and their competitors.

Keep watchi*) thi& &pacefor more cuz I am sure this is just is just the beginning NN

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Prici*) &trate)ie&

1. Co&t : P(!& Prici*)7 he company will work out how much it costs them to

make of buy in a product then add on an amount for the profit.

2. O!r 8a&e Prici*)7 Some companies offer ser-ices and they need to set prices

for those ser-ices. It is normal for ser-ice companies to set a price per7hour. .g.

Solicitors, plumbers, gardeners, electricians.

3. 7i++i*)7 Some times when a product is launched, a high price is set, but as

more customers buy it, the price may need to be lowered, to maintain sales, e.g.

*S*;s, 5J5;s, games, game consoles etc.

4. Pe*etrati*)Prici*)7 / low price, maybe used at the start to attract customers

to an introductory price. /s people become more familiar with the product the

price is raised to a normal le-el

1. Lo&t Lea"er& 7 Shops often set low prices on certain products to attract

customers in, they hope that when customers are in they will buy other normal

price products, e.g. Iceland;s #oast 5inner, Special Offers.

2. De&tro#erPrici*)7 his happens when a large company deliberately sets -ery

low prices hoping the competition cannot match them. hey hope to put the

competition out of business.

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A E,tra

/ products price has strong connections with its point in the life cycle. In the introduction

phase, a skimming or a penetration price might be usedM in the maturity phase,

promotional and discount prices may be usedM and in the decline phase, sale, or mark7

down prices may be used to get rid of unwanted stock.

"ig "azaar) he "rand "uilding 6hallenge

Ki&hore 8i#a*i

8i) 8a9aar2 8ra*"& "e*tit#5 Per&o*a(it# F #+bo(i&+

"ig "azaar is Indian personification of retail. It;s like an Indian bazaaror mandior mela,

the en-ironment created by traders to gi-e shoppers a sense of moment. Its personality

is of being an entity away from fancy or pretty and being authentically Lno7frillsL. Hishore

"iyani ne-er hired any foreign consultant for "ig "azaar which is e-ident from Indian7

specific personality of the brand. he brand;s personality is self7explanatory by its tag7

line only. his statement places "ig "azaar at the top of customer;s mind. It reflects that

entrepreneurship and simplicity are the essence of character of "ig "azaar. o use

predatory pricing is not in the personality of "ig "azaar, they ne-er sell goods below the

price they ha-e purchased it. "ig "azaar, the LIndian Wal7!artL, is the modern Indian

family;s fa-orite store. "ig "azaar symbolizes modern retail, the business which isn;t

looked up to in our country, is now in the eyes of many multi7national biggies. "ig

"azaar has shown a robust growth in recent years.

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De+erit& of Mar7eti*) a Co++o"it# Mar7et

"rands e-ol-e from Funbranded commodities; to references, where the name is used for

identification. his is also e-ident from the =oodyear;s (A0 chronological brand

categorization

here is lack of differentiation if marketing of commodity is done. 6ommodities and

differentiated products are the two ends of the product spectrum. ach unit of a

commodity is exactly like e-ery other unit. / product is a commodity when all units of

production are identical, regardless of who produces them. 6ommodities tend to be raw

materials like corn, wheat, copper, crude oil, etc. he stone marble is mined and sold by

many companies in #ajasthanM it;s like an unbranded commodity, where each producer

is selling identical product.

*eople that produce commodities are referred to as Lprice7takersL. his means that an

indi-idual producer has no control o-er hisEher price. On the other hand, people who are

owners of brands or differentiated products are Lprice7makersL. *roducer of a

differentiated product creates a separate market for hisEher indi-idual product.

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Va(!e of 8ra*"i*)

"randing plays a crucial role for all the products and ser-ices. / successful brand is an

identifiable product or ser-ice, and buyers or users percei-e -alues in it which matches

their needs.

here are certain ad-antages of branding. hey are) 7

Pro"!ct "ie& b!t a )oo" bra*" *ever "ie&2he first car 7model is no more

but the brand ;GO#5; is still ali-e. ;*ears; soap that was launched somewhere in

the end of (B'' is still ali-e although they ha-e changed the product. -en they

are looking for line extension but basic brand names are the same.

a(e& or +ar7et &hare2/ brand generates familiarity and trust, and hence, leads

to greater sales. "randed products ha-e an edge o-er unbranded products.

Pre+i!+ price2"rands generate trust, a brand manager can charge extra price

and people pay for that trust.

Differe*tiatio*26reating a brand is nothing but creating a strong association.

his association clearly differentiates the branded product from the rest.

/ccording to brand e-olution model de-eloped by Hunde &'''0 >as the -alue of brand

becomes stronger and more rele-ant to customers, the brand becomes more in-ol-ing,

and thus, managers need to make their brand -alues more rele-ant to increase

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customer;s in-ol-ement. his is explained by religion model also. he model

distinguishes 8 types of brands) 7

Pro"!ct 8ra*"2*roducts without any form of added -alue connected to the

generic element.

Co*cept 8ra*"2"rands that are dri-en by emotional -alues 7 as opposed to

product characteristics.

Corporate Co*cept 8ra*"2"rands that merge with the company and present

themsel-es in a sustained and consistent way.

8ra*" C!(t!re 8ra*"2"rands that are so strong that they 7 in the eyes of the

consumer 7 ha-e become e+uated with the function they represent.

8ra*" /e(i)io* 8ra*"2he ultimate brand position is that of brands that 7 in the

eyes of the consumer 7 ha-e become a LmustL, a faith to which they profess.

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8i) 8a9aar2 Po&itio*i*) F E&tab(i&h+e*t

"ig "azaar has established itself in the first +uadrant of Organization Jalue and

6ustomer Jalue !atrix of current strategy of "ig "azaar elaborates the core

competencies and areas of impro-ement. he key features that ha-e shaped in

establishing of brand includes) 7

"ig "azaar ensures that no other kiranastore E departmental store are offering

considerable discount compared to its own price. his helped "ig "azaar in

being the L-alue for moneyL store.

"ig "azaar scores high on product mix as compared to kiranastore.

6heap and local products are hea-ily stocked in "ig "azaar which make it easier

to attract lower middle class category of customers.

*romotion of kiranais rare e-ent but "ig "azaar used this channel efficiently to

establish itself as national brand.

6ustomer loyalty resulting in high up sell, i.e., selling to existing customers.

"ig "azaar refrains from high7end locations for business which reduces its rental

budget and pro-ides competiti-e ad-antage o-er competitors. Hishore "iyani has

taken Learly mo-ers ad-antageL in many retail spaces.

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P A*a(#&i& of 8i) 8a9aar

9* !arketing !ix is more useful for ser-ices industries and knowledge intensi-e

industries. Successful marketing depends on number of key issues. he se-en keys

issues are explained as) 7

Pro"!ct

"ig "azaar offers a wide range of products which range from apparels, food, farm

products, furniture, child care, toys, etc. . *roducts of all the major brands are a-ailable

at "ig "azaar ./lso, there are many in house brands promoted by "ig "azaar. "ig

"azaar sold o-er @'',''' pairs of jeans, 8',''' 5J57players and &8,''' microwa-e7

o-ens. In all, the fashion, electronics and tra-el segments made up about 9': of sales.

>ast year, these categories made up only about A':.

Price

he tag7line is "Is se sasta aur accha aur kahin nahi". hey work on the model of

economics of scale. here pricing objecti-e is to get L!aximum !arket ShareL. he

-arious techni+ues used at "ig "azaar are) 7

Va(!e Prici*) >EDLP : Ever# Da# Low Prici*)@2 "ig "azaar promises

consumers the lowest a-ailable price without coupon clipping, waiting for

discount promotions, or comparison shopping.

Pro+otio*a( Prici*)2 "ig "azaar offers financing at low interest rate. he

concept of psychological discounting #s. , #s. 4, etc.0 is used as promotional

tool. "ig "azaar also caters on Special -ent *ricing 6lose to 5iwali, =udi

*ad-a, and 5urga *ooja0.

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Differe*tiate" Prici*)2ime pricing, i.e., difference in rate based on peak and

non7peak hours or days of shopping is also a pricing techni+ue used in Indian

retail, which is aggressi-ely used by "ig "azaar.

8!*"(i*)2Selling combo7packs and offering discount to customers. he combo7

packs add -alue to customer.

P(ace

"ig "azaar stores are located in 8' cities with 98 outlets."ig "azaar has

presence in almost all the major Indian cities. hey are aggressi-e on their

expansion plans.

Pro+otio*

"ig "azaar started many new and inno-ati-e cross7sell and up7sell strategies in Indian

retail market. he -arious promotion techni+ues used at "ig "azaar include "saal ke

sabse saste teen din", Guture 6ard the card offers @: discount0, Shakti 6ard,

"rand ndorsement by !. S. 5honi, xchange Offer 7 FKunk Swap Offer;, *oint7of7

*urchase *romotions.

/d-ertising has played a crucial role in building of the brand. "ig "azaar ad-ertisements

are seen in print media, J, #adio G!0 and road7side bill7boards.

Peop(e

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hey are one of the key assets for any organization. he salient features of staff of "ig

"azaar are) 7

Well7trained staff, the staff employed by "ig7"azaar is well7suited for modern

retail.

Well7dressed staff impro-es the o-erall appearance of store.

mployees are moti-ated to think out7of7the7box. #etail sector is in growth stage,

so staff is empowered to take inno-ati-e steps.

mploys close to (',''' people and recruits nearly 8'' people e-ery month.

2se of technology like scenario planning for decision making.

!ultiple counters for payment, staff at store to keep baggage and security guards

at e-ery gate, makes for a customer7friendly atmosphere.

Proce&&

he goods; dispatch and purchasing area has certain salient features which include) 7

!ultiple counters with trolleys to carry the items purchased.

*roper display E posters of the place like 5/>, SO/*, etc.0.


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It deals with the final deli-erable or the display of written facts. his includes the current

system and a-ailable facilities.

8i) 8a9aar2 8ra*" E,te*&io*& Act!a((# Ma"e F !t!re Po&&ibi(itie&

Guture =roup is planning to split "ig "azaar into two entities. One will be front7end

consumer7oriented entity and other will be for back7end operations. "ack7end entity may

enter into joint -enture with leading international cash and carry retailers. Goreign

partners like 6arrefour, !etro, 6ostco, etc., are in the race, and their role will be to

impro-e efficiency in sourcing and logistics, which will help dri-e down prices and boost

margins.

he front7end operations will be further di-ided in three categories, 8i) 8a9aar

E,pre&&with store area less than 4',''' s+. ft., ta*"ar" 8i) 8a9aarwith store area

between 4',''' to 98,''' s+. ft., and 8i) 8a9aar !perce*tre&with store area more

than 98,''' s+. ft. . Guture =roup is also planning to distribute financial products like

consumer loans and insurance through "ig "azaar outlets.

Co*&!+er *&i)ht& F Perceptio*&

"ig "azaar is based on @76 theory of Hishore "iyani. he @76 symbolize 6hange,

6onfidence and 6onsumption, and according to this theory, L6hange and confidence is

leading to rise in 6onsumptionL. hey di-ided Indian customers in three categories) 7

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*"ia O*e

6onsuming class, constitutes only (4: of Indian population.

hey are upper middle class and most of customers ha-e substantial disposable

income.

Initial focus of "ig "azaar.

*"ia Two

Ser-ing class which includes people like dri-ers, house7hold helps, office peons,

washer7men, etc.

Gor e-ery India One, there are at least India wo and ha-e around 88: of Indian

population.

*"ia Three

Struggling class, remaining population of India.

6annot afford to inspire for better li-ing, ha-e hand7to7mouth existence.

3eeds cannot be addressed by current business models.

he potential customers of "ig "azaar are India One and India wo. he customer

insights were de-eloped by close obser-ation of the target set. he insights that came

out were) 7

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he clean and shiny en-ironment of modern retail stores creates the perception

that such store are too expensi-e and exclusi-e, and are not meant for India

wo.

India wo finds mo-es and find a lot of comfort in crowds, they are not

indi-idualistic. hey prefer to be in +ueues.

Indian7ness is not about swadeshi, it;s about belie-ing in Indian ways of doing

things.

Indian customers prefer to purchase grains, grams, etc., after touching them, so

it;s better not to sell in polythene packs. "ig "azaar has counters where you can

touch wheat, rice, sugar, etc., before purchasing.

/d-ertisements about schemes and offers through local newspapers, radio in

local languages, inspires customer more than the traditional ways.

he guards, salesman at the "ig "azaar outlets should not look smarter than

customer, so they prefer not to ha-e tie, etc., in their uniform.


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Gor Indians, shopping is an entertainmentM they come in groups, with families so

"ig "azaar should offer something for e-ery section of family. hat also led

separate section for clothes, -egetables, food, etc., that is multiple clusters within

a bazaar.

5e-eloped a di-ersity tracing cell to cater local patterns, demands, festi-als, as

e-ery region of customers has uni+ue demands.

A"verti&i*)2 The E&&e*tia( of 8ra*" 8!i("i*) Proce&&

/d-ertising is an essential component of brand building. he ad-ertisement and brand

building is done through -arious ways, the techni+ues used are) 7

Ta):(i*e2"ig "azaar tag7lines are the key components of ad-ertising. hese tag7lines

are modified according to demographic profile of customers. hese catch7phrases

appeared on hoardings and newspapers in e-ery city where "ig "azaar was launched.

-erybody understood and connected easily with these simple one7liners. he catch7

liners include L


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/a"io A"&2his techni+ue is used in cities like Sangli ier ( E ier & cities0. 3ow7a7

days, it is replaced by ad-ertisements on G! channels. his informs customers about

all new happenings at "ig "azaar.

a&hio* how&2LG/S


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*f(!e*ce of arva*a tore& Locate" i* The#a)ra#a Na)ar5 Che**ai

!any people think that "ig "azaar was inspired by Wall7!art but the truth is that

Hishore "iyani and his team members are neither inspired by 2S ways of doing

retailing nor they ha-e been to 2S much. he credit for foundation and

inspiration goes to Sara-ana Store, a family7run &87years7old store, whose

philosophy was 7 low margin, high turno-er. In that store, food, groceries, clothes,

e-erything had a separate section. It had around (&' people just to manage

crowd. he single shop was doing business of more than I3# &'' 6rore per

year. his shop was the template for "ig "azaar.

Ob&ervi*) C!&to+er& /e)!(ar(#

#egular customer feedback is also an influential factor for the success of "ig

"azaar. he "ig "azaar has a separate team that looks for customer;s

purchasing pattern and how they like or dislike products, how they approach

particular products. Gor example, unlike other stores where the most expensi-e

and catchy item is placed at the front display, "ig "azaar places the LJalue for

!oneyL items at check7out points.

+bibe" E*trepre*e!ria( pirit i* Or)a*i9atio*

5ecision making power is gi-en to e-ery le-el of employees at "ig "azaar.

Hishore "iyani has gi-en risk7taking power, which led to exposure of

entrepreneurial spirit in e-ery employee. -erybody in "ig "azaar operates with

speed and confidence when it comes to decision making.

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8!i("i*) o* Core Va(!e&

6ore -alues of Indian7ness, -aluing and nurturing relationships, and simplicity

shaped the brand. Hishore "iyani always belie-es in long7term relationships, with

customers, suppliers and employees. Once thinking about offering gifts to

employees close to 5iwali, Hishore "iyani suggested gi-ing them wall7paints to

keep their house clean. he paint is used in Indian culture to keep house clean

and brings freshness. he moti-e behind this was to keep e-erything clean and

bring freshness in organization.

trate)ic Deci&io*& Ta7e* to 8!i(" the 8i) 8a9aar 8ra*"

he strategic decisions that lead to building of "ig "azaar were) 7

/ea( E&tate Ga+e

Gor a retailer, location is one of the most important things. /ccording to Hishore "iyani,

real estate cost should be less than 8: of total sales of store in order to pro-ide

maximum benefits to customer.

he strategic decisions to secure spaces before other retailers join in ha-e resulted in

cost7sa-ing. /lso, it has created early presence in market.

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Hishore "iyani follows strategy to de-elop trust and nurture relationships with suppliers.

his trust led to strategically correct decisions most of the time. Whoe-er works with

Guture =roup, either lea-es in initial deals or continues fore-er.

H&e of Tech*o(o)#5 ce*ario:P(a**i*) F tor#:Te((i*)

"ig "azaar planning and design used ad-ance technologies like scenario7planning and

story7telling. hese techni+ues were mainly used for store7design layout, store7location

selection. he strategy to use user7focused, prototype7based de-elopment tool made

the brand adapt to the fast7changing external en-ironment.

De&i)* Ma*a)e+e*t

5esign7led thinking helped "ig "azaar to achie-e Fcustomer7first; objecti-e and

ultimately led to better financial performance. "ig "azaar strategy to focus on design led

to creation of Idiom, an independent design and consultancy firm, based in "angalore.

hey are one of the few organizations in India ha-ing economists, ethnographers and

sociologists working across -arious teams as a part of 5esign !anagement team.

8ac7:e*" Operatio*&5 !pp(# Chai*


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=. *tro"!ctio* to Operatio* Ma*a)e+e*t

Operations management is an area of business that is concerned with the production of

good +uality goods and ser-ices, and in-ol-es the responsibility of ensuring

that business operationsare efficientand effecti-e. It is the management of resources,

the distribution of goods and ser-ices to customers.

/*I6S he /ssociation for Operations !anagementalso defines operations

management as Lthe field of study that focuses on the effecti-ely planning, scheduling,

use, and control of a manufacturing or ser-ice organization through the study of

concepts fromdesign engineering,industrial engineering, management information

systems, +uality management, production management, in-entory

management, accounting, and other functions as they affect the organizationL.

/dditionally, he Operations !anagement "ody of Hnowledge O!"OH0 Gramework

defines the scope of operations management and the acti-ities and techni+ues that are

a part of the operations management profession.

Operations also refer to the production of goods and ser-ices, the set of -alue7added

acti-ities that transform inputs into many outputs. Gundamentally, these -alue7adding

creati-e acti-ities should be aligned with market opportunity for optimal enterprise

performance.

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http://en.wikipedia.org/wiki/Business_operationshttp://en.wikipedia.org/wiki/Efficienthttp://en.wikipedia.org/wiki/Effectivehttp://en.wikipedia.org/wiki/APICS_The_Association_for_Operations_Managementhttp://en.wikipedia.org/wiki/Design_engineeringhttp://en.wikipedia.org/wiki/Industrial_engineeringhttp://en.wikipedia.org/wiki/Management_information_systemshttp://en.wikipedia.org/wiki/Management_information_systemshttp://en.wikipedia.org/wiki/Quality_managementhttp://en.wikipedia.org/wiki/Production_managementhttp://en.wikipedia.org/wiki/Inventory_managementhttp://en.wikipedia.org/wiki/Inventory_managementhttp://en.wikipedia.org/wiki/Accountinghttp://en.wikipedia.org/wiki/Business_operationshttp://en.wikipedia.org/wiki/Efficienthttp://en.wikipedia.org/wiki/Effectivehttp://en.wikipedia.org/wiki/APICS_The_Association_for_Operations_Managementhttp://en.wikipedia.org/wiki/Design_engineeringhttp://en.wikipedia.org/wiki/Industrial_engineeringhttp://en.wikipedia.org/wiki/Management_information_systemshttp://en.wikipedia.org/wiki/Management_information_systemshttp://en.wikipedia.org/wiki/Quality_managementhttp://en.wikipedia.org/wiki/Production_managementhttp://en.wikipedia.org/wiki/Inventory_managementhttp://en.wikipedia.org/wiki/Inventory_managementhttp://en.wikipedia.org/wiki/Accounting


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Operatio*& a& a Tra*&for+atio* Proce&&

Inputs ransformation Output

Operations management is about the way organizations produce goods and ser-ices.

-erything you wear, eat, sit on, use, read or knock about on the sports field comes to

you courtesy of the operations managers who organized its production. -ery book you

borrow from the library, e-ery treatment you recei-e at the hospital, e-ery ser-ice you

expect in the shops and e-ery lecture you attend at uni-ersity all ha-e been produced.

his definition reflects the essential nature of Operations !anagementM it is a central

acti-ity in organizing things. /nother way of looking at an operation is to consider it as a

transformation process.

Operations are a transformation processM they con-ert a set of resources I3*2S0 into

ser-ices and goods O2*2S0. hese resources may be raw materials, information,

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or the customer itself. hese resources are transformed into the final goods or ser-ices

by way of other ;transforming; resources 7 the facilities and staff of the operation.

/aw Materia(&

/n ob-ious example is a cabinet maker, who takes some wood, cuts and planes

it, and then polishes it until a piece of furniture is produced.

*for+atio*

/ tourist office gathers and pro-ides information to holiday makers, and assists in

ad-ising on places to stay or -isit.

C!&to+er&

/t an airport, you are one of the many resources being processed. he operation

you are in-ol-ed in is about processing your ticket and baggage, mo-ing from

ticket desk through the customs and duty7free areas, to deli-er you to the

awaiting plane.

E,te*"i*) the proce&&...

If we add a few more parts to the transformation process, we can see the key elements

that operations managers need to consider. Operations is about designing ser-ices,

products and deli-ery systemsM

(. !anaging and controlling the operations system.

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&. Ginding ways to impro-e operations.

Operatio*& Ma*a)e+e*t i& a(( abo!t provi"i*) c!&to+er& with pro"!ct& a*"

&ervice&.

Pou sur-i-e by gi-ing customers with what they want

-ery *roduct or Ser-ice is really a bundle of different attributes.

*roduct, place, price, performance, +uality, timing, ser-ice, etc.

6ustomers are looking for a bundle of characteristics

otal bundle pro-ides the le-el of -alue customers deem appropriate

"uying products with the attributes they want at the lowest price possible

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/ttributes

*rice

uality

Image

*erformance

Safety

*lace % distribution

ime % deli-ery, a-ailability


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E,a+p(e& of Operatio*& Deci&io*&

Operations managers must make decisions on three le-els

Strategic

actical

Operating

T/ATEGC DECON2

>onger term decisions

2sually made at the senior management le-el

*roduct and ser-ice strategy

6ompetiti-e priorities

*ositioning strategy

>ocation, capacity

>ong term partnerships

uality system and o-erall approach to +uality

TACTCAL DECON

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!edium term decisions

actical in nature

!ade by middle and senior managers

*rocess design

echnology management

Kob design and workforce management

6apacity management

Gacility location

Gacility layout

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OPE/ATNG DECON

Shorter term decisions

!ade at middle and lower management le-els

Gorecasting

!aterials management

In-entory management

/ggregate planning

!aster production scheduling

*roduction control

Scheduling

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. Tech*o(o)# i* /etai(2

O-er the years as the consumer demand increased and the retailers geared up to meet

this increase, technology e-ol-ed rapidly to support this growth. he hardware and

software tools that ha-e now become almost essential for retailing can be into & broad

categories.

C!&to+er *terfaci*) #&te+&2

8ar Co"i*) a*" ca**er&

*oint of sale systems use scanners and bar coding to identify an item, use pre7stored

data to calculate the cost and generate the total bill for a client. unnel Scanning is a

new concept where the consumer pushes the full shopping cart through an electronic

gate to the point of sale. In a matter of seconds, the items in the cart are hit with laser

beams and scanned. /ll that the consumer has to do is to pay for the goods.

Pa#+e*t

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*ayment through credit cards has become +uite widespread and this enables a fast and

easy payment process. lectronic che+ue con-ersion, a recent de-elopment in this

area, processes a che+ue electronically by transmitting transaction information to the

retailer and consumer;s bank. #ather than manually process a che+ue, the retailer -oids

it and hands it back to the consumer along with a receipt, ha-ing digitally captured and

stored the image of the che+ue, which makes the process -ery fast.

*ter*et

Internet is also rapidly e-ol-ing as a customer interface, remo-ing the need of a

consumer physically -isiting the store.

Operatio* !pport #&te+&2

E/P #&te+

Jarious #* -endors ha-e de-eloped retail7specific systems which help in integrating

all the functions from warehousing to distribution, front and back office store systems

and merchandising. /n integrated supply chain helps the retailer in maintaining his

stocks, getting his supplies on time, pre-enting stock7outs and thus reducing his costs,

while ser-icing the customer better.

C/M #&te+&

he rise of loyalty programs, mail order and the Internet has pro-ided retailers with real

access to consumer data. 5ata warehousing 1 mining technologies offers retailers the

tools they need to make sense of their consumer data and apply it to business. his,

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along with the -arious a-ailable 6#! 6ustomer #elationship !anagement0 Systems,

allows the retailers to study the purchase beha-ior of consumers in detail and grow the

-alue of indi-idual consumers to their businesses.

A"va*ce" P(a**i*) a*" che"!(i*) #&te+&

/*S systems can pro-ide impro-ed control across the supply chain, all the way from

raw material suppliers right through to the retail shelf. hese /*S packages

complement existing but often limited0 #* packages. hey enable consolidation of

acti-ities such as long term budgeting, monthly forecasting, weekly factory scheduling

and daily distribution scheduling into one o-erall planning process using a single set of

data

he major reasons behind the de-elopment of new trends are)

Scalable and profitable #etail models are well established for most of the

categories

#apid -olution of 3ew7age Poung Indian 6onsumers

#etail Space is no more a constraint for growth

*artnering among "rands, retailers, franchisees, in-estors and malls

India is on the radar of =lobal #etailer Suppliers

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I. HTH/E T/END2 COPE O $;hr /ETALNG

he concept of &4hr. retailing in India has been present only in -ery limited formats like

the pharmaceuticals /pollo0 and fuel retail outlets


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positi-e figures and if the crowd increases then the store can come in a bigger way to

reach out to their customers.

he other option for trying the concept of &4hr retailing is that the retailer can ha-e a

mobile outlet which can place itself in the areas which ha-e substantial night traffic for

the sales to happen. /nd once the people are to the &4hr shopping then the retail plans

can be altered accordingly.

/!ra( V& Hrba* /etai( Tre*"&

India;s largely rural population has also caught the eye of retailers looking for new areas

of growth. I6 launched the country;s first rural mall F Cha!pa( a)ar , offering a

di-erse product range from G!6= to electronics appliance to automobiles, attempting

to pro-ide farmers a one7stop destination for all of their needs. here has been yet

another initiati-e by the 56! Sriram =roup called the F %ari#a(i 8a9aar , that has

initially started off by pro-iding farm related inputs and ser-ices but plans to introduce

the complete shopping basket in due course. Other corporate bodies include scorts,

and ata 6hemicals with ata Hisan Sansar0 setting up agri7stores to pro-ide

productsEser-ices targeted at the farmer in order to tap the -ast rural market.

6ommenting on the #ural #etailing chapter in I35I/ #/I> #*O# &''8, !r. /di ".

=odrej, 6hairman, he =odrej =roup India;s one of the leading corporate majors0 said

that his group had also launched the concept of agri7stores named ;/dhaar;, which

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ser-ed as one7stop shops for farmers selling agricultural products such as fertilisers 1

animal feed and also pro-iding farmers knowledge on how to effecti-ely utilise these

products. Lhere are B stores already operating in !aharashtra and =ujarat and further

expansion is -ery much on the cards.


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concepts are likely to go a long way in bringing a huge untapped population within the

pur-iew of organized retailing, thereby, increasing the size of the total market

he abo-e chart makes it clearly e-ident why the rural retail market has been attracting

the big giants to in-est in it.

Hrba* Tre*"&

he urban retailing has been experimenting with many formats like the supermarkets,

hypermarkets, specialty stores, multi branded outlets etc. and of latest it seems to be

embracing the trend of mall culture. It is a rich man;s world too, with multi7screen

cinemas, restaurants, games and branded shops 7 well out of the reach of many of the

country;s one billion people. "ut India;s middle7classes, widely tra-elled and with deep

pockets, are flocking to malls.

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/APD G/OWT%)

India;s organized retail industry accounts for just @: of the country;s total retail sales,

though it is poised to grow by 9: per year in the next fi-e years to a staggering ?&4bn.

Guelling this growth are India;s sprawling shopping malls, which are increasingly

challenging


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J. WOT ANAL32

/ SWO analysis of the Indian organized retail industry is presented below)

T/ENGT%2

(. #etailing is a 6Tech*o(o)#:i*te*&ive6 industry. It is technology that will help the

organized retailers to score o-er the unorganized retailers. Successful organized

retailers today work closely with their -endors to predict consumer demand, shorten

lead times, reduce in-entory holding and ultimately sa-e cost. xample) Wal7!art

pioneered the concept of building competiti-e ad-antage through "i&trib!tio* F

i*for+atio* &te+& in the retailing industry. hey introduced two inno-ati-e logistics

techni+ues % cross7docking and 5I electronic data interchange0

&. On an a-erage a super market stocks up to 8''' SH2;s against a few hundred

stocked with an a-erage unorganized retailer. his will pro-ide -ariety in products

re+uired breadth 1 depth for consumers0

@. /s a conse+uence of high -olumes, procurement will be direct from the !anufacturer.


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that actual con-ersions of footfall into sales for a mall outlet is approximately &'7&8:.

On the other hand, a high street store of retail chain has an a-erage con-ersion of

about 8'7A':. /s a result, a stand7alone store has a #OI return on in-estment0 of &87

@':M in contrast the retail majors are experiencing a #OI of B7(':

$. C!&to+er Lo#a(t#) #etail chains are yet to settle down with the proper merchandise

mix for the mall outlets. Since the stand7alone outlets were established long time back,

so they ha-e stabilized in terms of footfalls 1 merchandise mix and thus ha-e a higher

customer loyalty base.

Opport!*it#2

(. he Indian middle class is already @' 6rore 1 is projected to grow to o-er A' 6rore

by &'(' making India one of the largest consumer markets of the world. he MAGE:

KAprojections indicate that by &'(8, India will ha-e o-er -- Crore peop(e !*"er the

a)e of $ 7 reflecting the enormous opportunities possible in the 7i"& a*" tee*&

retai(i*) &e)+e*t.

&. Organized retail is only @: of the total retailing market in India. It is estimated to grow

at the rate of &87@': p.a. and reach I3# (,'',''' 6rore by &'('.

'. Perco(ati*) "ow*) In India it has been found out that the top A cities contribute for

AA: of total organized retailing. While the metros ha-e already been exploited, the

focus has now been shifted towards the tier7II cities. he ;retail boom;, B8: of which has

so far been concentrated in the metros is beginning to percolate down to these smaller

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cities and towns. he contribution of these tier7II cities to total organized retailing sales

is expected to grow to &'7&8:.

;. /!ra( /etai(i*)2 India;s huge rural population has caught the eye of the retailers

looking for new areas of growth. I6 launched India;s first rural mall L6haupal SagaL

offering a di-erse range of products from G!6= to electronic goods to automobiles,

attempting to pro-ide farmers a one7stop destination for all their needs.L


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Cha((e*)e& i* /etai(

he following are the key areas that may pose a threat to those retail companies that

ignore the impacts of gi-ing less importance to manage their demand and supply) 7

Gorecasting and In-entory !anagement for KI replenishments of products.

*eak Season 5emand


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Propo&e" !pp(# Chai* trate)ie& for /etai( *"!&tr#

!pp(# Chai* trate)ie& i* /etai(

"ulk7"reaking) Orders can be done in smaller lots with a good understanding with the

supplier. his can be achie-ed by following ways) 7

Spatial 6on-enience) Strategically locating the outlet with distribution

networks and warehouses located proximally.

Supplier holds in-entory.

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Jendor !anaged In-entory) In this case, the -endor himself is gi-en the responsibility to

handle the in-entory. / space for the -endor is rented in the outlet, and he takes care of

the shel-es and the space. It is a &7way agreement wherein the -endor gets the space

to market his product by interacting one7to7one with the customers.

*oint of Sale Information System) /s soon as one stock keeping unit mo-es out of the

store when purchased by a customer, the information readily flows to the supplier.


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>ogistics)

Safe and reliable transport at as much low price as possible.

6onstant contact with distribution teams trucks, trains, etc.0 and track where

material is.

*artnership with transportation firms so that cost and transport can be shared if

the shipment does not occupy the whole truck space.

*rocurement) Jendor$s side points to take care0

Strong #elationship

Information sharing and updating plan change

6ombine -endors by minimizing transportation cost

6hoose -endors in proximity

Optimum lot size taking -endors into confidence

*roduction)

>ine should run smoothly without delays due to ordering and transportation fulfillment

and logistics ha-e to be met first0.

Mo"e( i* Detai(

*te)rate" De+a*" Ma*a)e+e*t2

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he sales in the outlet is kept track of bill after bill hour after hour.

Store register work is made online and paper work is done with.

Gorecasting made with data on past consumption and present market trend.

Optional forecasting is made in case of seasonal re+uirements.

*eriodic offers and incenti-es are made a-ailable to the customers to generate

demand.

Tip& for Co*tro((i*) /etai( *ve*tor#

*art of the answer to the Lbuying problemL is in-entory control. In fact, the biggest

reason retail businesses fail is that they lack in-entory control. ike much of the new technology a-ailable to business owners, !anagement

Information Systems !IS0 is still e-ol-ing, and along the way it becomes both more

sophisticated and less expensi-e. !IS tools can be implemented to gain a significant

ad-antage o-er competitors.


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goals of an in-entory management system before implementing. *ossibly the best

examples of in-entory managementcome from big retailers. o put it simply) Hmart

neglected in-entory control and failed, and Wal7!art concentrated on becoming the

leading edge of in-entory control and is now one of the world;s largest companies.

It is a common misconception among small retailers that only industry giants like Wal7

!art can use !IS effecti-ely. Sam Walton himself began as a small retailer, but one of

his most ad-antageous assets was his deep understanding of in-entory control;s

importance.

!IS is commonly regarded as a daunting system to implement by those with limited

experience in this highly7technical areaM howe-er it is critical to understand exactly what

!IS can accomplish. /lthough internal hires are a-ailable, !IS is made greatly

accessible to the small retailer by consulting companies. he basic goal of a point7of7

purchase in-entory control system is to pro-ide information on profitability, status, and

rate of sale for e-ery item a retailer stocks, instantly. hese metrics can then be used to

impro-e in-entory turno-er and return on in-estment.

Once an !IS infrastructure is established, it makes sense for the retailer to integrate

-endors into the system. Jendors are subject to an incenti-e to keep their in-entory on

store shel-es, and systems are a-ailable which pro-ide -endors with sales and stock

information directly from the point of sale system. *ro-iding your -endors with timely

information and making them responsible for maintaining in-entory your o-erall

efficiency is impro-ed as your own workload is diminished. he net impact on your

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business is increased turno-er rates and fewer runs on in-entory.

/nything that results in making the chain between Jendors, #etailers and 6ustomers

more efficient also results in additional profit. G#I5, an example of an electronic

recognition system, enables tracking of items -ia a computer chip embedded in the

product or packaging, which is detected at -arious stages along the distribution process.

*roduct information obtained in this way is uploaded instantly to the in-entory control

system, which reduces the time spent in recei-ing and stocking and allows for a more

efficient shipping process. It is imperati-e for retailers to be aware of in-entory

performance and its effects on profitability.

In-entory control is not, howe-er, the answer to all +uestions. In-entory controls

systems can tell you how the in-entory in stock is performing. It doesn;t tell you that new

products you should carry. "uying is a great area of opportunity, especially for the small

retailer who is close to customers and much more responsi-e to their demands than is

the national chain.

Of course, in-entory control is not the ultimate solution to retailers; problems. Gor

example, in-entory control tells you what products are performing well, but it can;t tell

you what new products to stock. In-entory control is a great way for small retailers to act

like one of the big guys, and gain an ad-antage o-er other small competitors.

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Pri+ar# Data

Operations are classified into @ functions below)

!anagement Gunction

=eneral !erchandise

In-entory 1 6redit !anagement

MANAGEMENT HNCTON2

!anagement is creati-e problem sol-ing. his creati-e problem sol-ing is accomplished

through four functions of management

*lanning

Organizing

Staffing

5irecting

6ontrolling

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he intended result is the use of an organization;s resources in a way that accomplishes

its mission and objecti-es.

P(a**i*) is the ongoing process of de-eloping the business; mission and objecti-es

and determining how they will be accomplished. *lanning includes both the broadest

-iew of the organization, e.g., its mission, and the narrowest, e.g., a tactic for

accomplishing a specific goal.

Or)a*i9i*)is establishing the internal organizational structure of the organization. he

focus is on di-ision, coordination, and control of tasks and the flow of information within

the organization. It is in this function that managers distribute authority to job holders.

taffi*)is filling and keeping filled with +ualified people all positions in the business.

#ecruiting, hiring, training, e-aluating and compensating are the specific acti-ities

included in the function. In the family business, staffing includes all paid and unpaid

positions held by family members including the ownerEoperators.

Directi*) is influencing people;s beha-ior through moti-ation, communication, group

dynamics, leadership and discipline. he purpose of directing is to channel the beha-ior

of all personnel to accomplish the organization;s mission and objecti-es while

simultaneously helping them accomplish their own career objecti-es.

Co*tro((i*)is a four7step process of establishing performance standards based on the

firm;s objecti-es, measuring and reporting actual performance, comparing the two, and

taking correcti-e or pre-enti-e action as necessary.

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http://www.ag.ohio-state.edu/~mgtexcel/Planning.htmlhttp://www.ag.ohio-state.edu/~mgtexcel/Organize.htmlhttp://www.ag.ohio-state.edu/~mgtexcel/Staffing.htmlhttp://www.ag.ohio-state.edu/~mgtexcel/Direct.htmlhttp://www.ag.ohio-state.edu/~mgtexcel/Control.htmlhttp://www.ag.ohio-state.edu/~mgtexcel/Planning.htmlhttp://www.ag.ohio-state.edu/~mgtexcel/Organize.htmlhttp://www.ag.ohio-state.edu/~mgtexcel/Staffing.htmlhttp://www.ag.ohio-state.edu/~mgtexcel/Direct.htmlhttp://www.ag.ohio-state.edu/~mgtexcel/Control.html


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Ma*a)eria( (eve(& a*" hierarch#

he management of a large organization may ha-e three le-els)

(. Senior management or Ltop managementL or Lupper managementL0

&. !iddle management

@. >ow7le-el management, such as super-isors or team7leaders

4. Goreman

8. #ank and Gile

Top:(eve( +a*a)e+e*t

#e+uire an extensi-e knowledge of management roles and skills.

hey ha-e to be -ery aware of external factors such as markets.

heir decisions are generally of a long7term nature

heir decisions are made using analytic, directi-e, conceptual andEor

beha-ioralEparticipati-e processes

hey are responsible for strategic decisions.

hey ha-e to chalk out the plan and see that plan may be effecti-e in the future.

hey are executi-e in nature.

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Mi""(e +a*a)e+e*t

!id7le-el managers ha-e a specialized understanding of certain managerial

tasks.

hey are responsible for carrying out the decisions made by top7le-el

management.

Lower +a*a)e+e*t

his le-el of management ensures that the decisions and plans taken by the

other two are carried out.

>ower7le-el managers; decisions are generally short7term ones

Goreman E lead hand

hey are people who ha-e direct super-ision o-er the working force in office

factory, sales field or other workgroup or areas of acti-ity.

#ank and Gile

he responsibilities of the persons belonging to this group are e-en more

restricted and more specific than those of the foreman.

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Ge*era( Mercha*"i&e

In marketing, a product is anything that can be offered to a market that might satisfy a want or

need. In retailing, products are called merchandise. It is an art and science of displaying

merchandise within store, it is about implementing effecti-e design, ideas to educate customer,

create desire and finally increase store traffic and sales -olume.

ien Items

lectronic Items

!obile ^one

Gurniture

Star Sitara

Opticians

!en, >adies and Hids wear

Goot Wear

!usic

oys

Stationery

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*ve*tor# F Cre"it Operatio*& >H&i*) ET/M oftware0

*ve*tor# Ma*a)e+e*t

In-entory !anagement and In-entory 6ontrol must be designed to +eet the "ictate&

of the +ar7etp(ace a*" &!pport the co+pa*#& &trate)ic p(a* . he many changes

in market demand, new opportunities due to worldwide marketing, global sourcing of

materials, and new manufacturing technology, means many companies need to change

their In-entory !anagement approach and change the process for In-entory 6ontrol.

5espite the many changes that companies go through, the basic principles of In-entory

!anagement and In-entory 6ontrol remain the same. Some of the new approaches and

techni+ues are wrapped in new terminology, but the !*"er(#i*) pri*cip(e& for

acco+p(i&hi*) )oo" *ve*tor# Ma*a)e+e*t a*" *ve*tor# activitie& have *ot

cha*)e".

he In-entory !anagement system and the In-entory 6ontrol *rocess pro-ides

information to efficiently manage the f(ow of +ateria(&, effecti-ely !ti(i9e peop(e a*"

e!ip+e*t5 coor"i*ate i*ter*a( activitie&5 a*" co++!*icate with c!&to+er&.

In-entory !anagement and the acti-ities of In-entory 6ontrol do not make decisions or

manage operationsM they pro-ide the information to !anagers who make +ore

acc!rate a*" ti+e(#decisions to manage their operations.

he basic building blocks for the In-entory !anagement system and In-entory 6ontrol

acti-ities are)

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E+p(o#ee Ma*a)e+e*t #&te+

mployee 5etails

!argin racking

+art #&te+

5aily Sales #eport

"illing #eport

otal 5iscount 1 #e-enue #eports

ca**i*) #&te+

*roduct 5iscount

*roduct *ricing 5ecision

*roduct !anagement

Ve*"or Ma*a)e+e*t #&te+

In-entory !anagement System

*urchasing Order !anagement

In-oice *urchasing Order System

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ec!rit# Ma*a)e+e*t

6

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100307189 Operations at Retail Industry BIG BAZAR

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