Aim Convenience Store

8/6/2019 Aim Convenience Store

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INTRODUCTION OF RETAIL

y Retailing consists of those business activities involved in the sale ofgoods and services to consumers for their personal, family orhousehold use. It is the final stage in a channel of distribution, which

comprises all of the businesses and people involved in the physicalmovement and transfer of ownership of goods and services fromproducer to consumer. Retailing involves

y Interpreting needs of the consumers

y Developing good assortments of merchandise

y Presenting them in an effective manner so that consumers find it easyand attractive to buy.


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THE GROWTH FACTORS

In fact, Indian retail industry is the fastest growing industry in India and itaccounts for 10% of the country's GDP. In 2006, the retail industry in Indiaamounted to US$ 200 billion and out of this, the organized retail sector in

India amounted to US$ 6.4 billion.

Growing Prosperity

Increase in the Size of Disposable Income

Place is no more important

Increasing Potential in Rural Markets Higher Proportionate Rural Expenditure

Young Population

Fundamental Changes in Indian Economy


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FUTURE PROSPECTS

By 2010, the Indian organized retail sector is expected to rise to US$ 23billion. In 2003, the Indian organized retailing sector accounted formore than 4.5 million sq. ft of space absorption by malls.

Many Indian companies have entered the retail industry in India and

this is also a factor in the growth of Indian organized retail sector.Reliance Industries Limited is planning to invest US$ 6 billion in theorganized retail sector in India by opening 1500 supermarkets and 1000hypermarkets. Bharti Telecoms is planning a joint venture worth 750million with Tesco a global retail giant. Pantaloons is planning to investUS$ 1 billion in order to increase its retail space to 30 million squarefeet. Such huge investments is also a factor in the growth of the

organized retail sector in India.

Global retail giants are also entering the retail industry in India andthis is also one of the factors in the growth of the organized retail sectorin India


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A comprehensive list of Retailers in India

across various segments:

y HYPER MARKET: Big Bazaar, Spencers, Vishal Retail, Magnet, Star India

Bazaar, Shop Rite.

y DEPARTMENT STORES: Shoppers Stop, Pantaloons, Pyramid Mega Store,Lifestyle, Globus, Westside and Central Mall.

y CONVENIENCE STORES: Trumart, Nilgiris, Food World, Subhishka, Reliance

Fresh, Tirtenthra, Spencers Daily and Spinach.

y SPECIALITY STORES: M.A.C, Titan, Bata and Tanishq.

y SPECIALITY FORMATS: Archies, Depot, Landmark, Crossword and Planet M

y FURNITURE RETAILING: Concept, Living Room, Style Spa and Tangent

y CONSUMERDURABLE CHAINS: Viveks, Tata Croma, Vijay Sales, Sumariaand Sony Mony.


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AIM CONVENIENCE STORE


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Research Methodology Primary Data:

We developed the questionnaire for the survey. The data has beencollected in the area ofBhagawati Garden (Dwarka Mor) from 150persons.

Secondary dataThere are two types of secondary data: internal and external secondarydata. Data that have already been collected for some purpose otherthan the current study. Researching information which has alreadybeen published.

Secondary source of data used consists of books and websites


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Bhagwati Garden Extn., Jain Road, Uttam Nagar,

New Delhi-110059

Place:- the location selected by us has certain tacticaladvantage:-

It is situated on a wide road. It is two sided.

There is no other retail outlet within

1.5 km range.

The road has very high footfall as it is a connectingroad to Dwarka Mor metro station.

Capital rent is still less as compared to adjoining areas.


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Area of the store

y Sales Area = 750 sq. feet

y Store Area = 100 sq. feet

y Washroom And change room = 50 sq. feetTOTAL = 900 sq. feet


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ITEMS IN THE STOREFruits vegetables IQF vegetables Grocery itemsApple Potatoes FrozenBhindi Rice

Strawberry Cauliflower Tomato Product Flour

Raspberry Cucumber Fruit Drink in Tetrapack Pulses

Grapes Onions Frozen Sarson Saag Sugar

Litchi Greeb chilli Frozen Cauliflower Salt

MangoAlphonso Garlic Frozen Tomato Spices

Kiwi Fruit Capsicum FrozenAloo Tikki Health Drinks

Pomegranate French beans Frozen French beans Cooking oil

Mango Chausa Bitter gourd Frozen French Fries Ghee

Chikoo (Sapota) Arvi Frozen Mixed Vegetables Cleaning powder

Mandarins Brinjal Squash Soaps

Guava Bathua Jam ToothPaste


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ExpenditureBuilding cost Average rental @ Rs. 17/sq. feet = Rs. 15,000 Security deposits = Rs. 1, 00,000Furniture & Machinery costs (one time) Wall sacks (15) @ Rs.4, 000 = Rs. 60,000 Iron Stand (10) @ Rs. 3,000 = Rs. 30,000 Sales counter (2) @ Rs. 5,000 = Rs. 10,000 Computers (2) @ Rs. 18,000 = Rs. 36,000

Other furnishings = Rs. 10,000 Tally software for sales = Rs. 2,000 Diesel Genset (silent) = Rs. 45,000 Air-conditioner (3) @ Rs. 26,000 = Rs. 78,000 PP False Ceiling @ Rs. 50 Sq. feet = Rs. 37,500 Lighting (approx.) = Rs. 25,000 Freezer (1) = Rs. 23,000 Bike (2) @ Rs. 40,000 = Rs. 80,000

Inauguration = Rs. 50, 000 Promotion = Rs. 10, 000 Miscellaneous = Rs. 25,000 Total = Rs. 6, 21,500


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Start Up Capitaly Grocery = Rs. 1,50, 000

y Cosmetics = Rs. 50, 000

y Dry Fruits = Rs. 30, 000

y Fruits & Vegetables = Rs. 20, 000

y Frozen items = Rs. 15, 000

Total = Rs. 3,00, 000 (approx.)


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Monthly expenses

EMI =Rs. 11,000 Rent (building) = Rs. 15,000 Rent (Electricity) = Rs. 5,000

Transport (40*20*30) = Rs. 24,000 Diesel (6L*30*30) = Rs. 5,000 (approx.) Petrol (5l*50*30) = Rs. 7,500

Staffing Store Manager (1) @ Rs. 15,000 = Rs. 15,000

Sales person (4) @ Rs. 5,000 = Rs. 20,000 Sales Counter (4) @ Rs. 8,000 = Rs. 32,000 Security (2) @ Rs. 3,000 = Rs. 6,000 Hygiene = Rs. 1,000 Total Monthly expenses = Rs. 1, 41,000 (approx.)


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Total Expensey Building Cost (security) = Rs. 1,00, 000

y Start up Capital = Rs. 3,00, 000

y Furniture & machinery = Rs. 6, 21,500

y Start Up Capital = Rs. 3,00, 000

y Monthly expenses = Rs. 1,41, 000

y Working Capital = Rs. !,00, 000

Total = Rs. 15,62, 500

y Capital Available = Rs. 16,00, 000

yCash in Hand = Rs. 37, 500


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Sources Of Capitaly Equity = Rs. 6,00, 000

( 3 * 2 Lac each)

y Debt = Rs. 10,00, 000

( @ 10.25 % p.a.)


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Revenue Generation Model

Average no. of customers per day = 200 Average expenditure per customer = Rs. 125 Turnover per day = Rs.25,000 Turnover per month = Rs.7,50,000

Average profit per month @ 20 % = Rs.1,50,000 Wastage @2 % = Rs. 12,000

(approx.) Profit Remaining = Rs. 1, 38,000

(approx) Per month expense = Rs. 1, 41,000

First Month Loss=

Rs. 3,000(approx.)


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Findings and Analysis1. Average Monthly Income.

9 1

69

54 30000

The collected information shows that average monthly income is more than Rs

10000.T

herefore target population has higher potential with respect to our proposedretail outlet. . There is increased sophistication in the shopping pattern of

consumers, which has resulted in big retail chains coming up in most metros; mini

metros and towns being the next target. Consumer taste and preferences are

changing leading to radical alteration in lifestyles and spending patterns which in

turn is giving rise to new business opportunities. Companies need to be dynamic

and proactive while responding to the ever-changing trends in consumer lifestyle

and behavior.


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2. Average Monthly expenditure on grocery.

1430

46

60

6000

More than 2/3rd of the target population spends above Rs .4,000 a month. This

fact combined with higher disposable income of target population augers well

for the prosperity of our retail outlet. Higher expenditure on grocery clearly

shows a positive potential market for a new retail outlet. the rise in the working

population which is young, pay- packets which are hefty, more nuclear families

in urban areas, rise in the number of women working, more disposable income

and customer aspiration, western influences and growth in expenditure for

luxury items. All these are the factors for the growth in Indian organized retail

sector.


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3. Preference between organized and unorganized market.

107

3

Organized

Unorganized

A large pie of the target population is inclined towards buying from organized market.

Target population mostly consists of working class, who dont have time and effort to go

for shopping in an unorganized market. They rather prefer shopping under one roof for alltheir grocery needs. Indias 60% of the population is under the age group of below 30

years. They tend to avoid hassles of shopping in traditional shops. The reason for this is

bargaining problem and lack of standardization of product.


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4. Number of visits per week to the market

Majority of the target population prefers to shop twice or thrice a week. This isattributed to the fact that the target population mostly comprises of working class. Sothey have very limited time for shopping. Brighter side for our retail our retail outlet isthat if the number of visit is less, the average expenditure per visit tends to be high.

Also since majority of working population is young therefore they avoid spending muchtime for household shopping.

35

48

52

15

Once

Twice

Thrice

Daily


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5. Who mostly does shopping in the family?

49

66

269

Male

Female

Children

Servant

Collected information clearly shows that it is either the male or female members who

do shopping. So the marketing strategy should be designed accordingly. Almost half

of the respondents say that women in the family do household shopping. So anypromotion aimed at attracting women will lead to higher revenue generation.


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6. How far you are willing to travel to shop?

8943

18

800m

Majority of population dont want to go beyond 500m to purchase grocery. It is a

well known fact that the customer does not like to travel beyond 700-800m for

house hold shopping. So location advantage is there with us, as there is no other

retail outlet in the vicinity of 1.5 km.


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7. Time to shop.

38

13

23

766-10AM

10AM-2PM

2-6PM

6-10PM

A large portion of the target population prefers to shop in the time range of 6-10

PM. This very supports the fact that the young population has very little time for

household shopping.Most of the times they prefer to shop on the way back

home. So the marketing strategy of our retail outlet should be such that it

facilitates evening shopping.


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8. Do you prefer home delivery?

134

16

Yes

No

Around 90% of the target population responded positively for home delivery

facility. This helps the target population to save upon their time, effort and

resources.


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9. Will you buy cut vegetables?

103

47

Yes

No

More than 2/3rd of the target population prefers to buy cut vegetables. As

majority of the target population is working class, so cut vegetables provide

them with the opportunity to save time and effort..


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QuestionnaireName: Date:Age:

Sex:

1. What is your average family monthly income?

a. Less than 5000

b. 5000-10000

c. 10000-30000

2. More than 30000 What is your familys average monthly expenditure on grocery items?a. Less than 2000

b. 2000-4000

c. 4000-6000

d. More than 6000

3. From where do you prefer to buy grocery items?

a. Organized market

b. Unorganized market4. How often a week do you visit the store?

(a)Once (b)Twice (c)Thrice (d)Daily


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5. Who usually shops in the family?

(a)Male (b) Female (c) Children (d) Servant

6. How far are you willing to travel to shop?(a)800m

7. At what time you prefer to buy?

(a)6-10AM (b) 10AM- 2 PM (c) 2- 6 PM (d) 6-10 PM

8. Do you prefer home delivery?

(a)Yes (b) No

9. If available would you prefer to buy cut-vegetables?

(a) Yes (b) No


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REFERENCES

y Retail management- Levy and Weitz

y Indian Retail Sector- Nitin Mehrotra

ywww.wikipedia.com


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