Research project report sumit b

RESEARCH PROJECT REPORT

CHAPTER 1

INTRODUCTION India started its Retail Journey since ancient time. In Ancient India there was a concept

of weekly HAAT, where all the buyers and sellers gather in a big market for bartering. It

takes a pretty long times to and step to shape the modern retail. In between these two

concepts (i.e. between ancient retail concept and the modern one there exist modern

Grocery/ mom and pop shops or Baniya ki Dukan. Still it is predominating in India So

the Indian retail industry is divided into two sectors- organized and unorganized. The

Indian retail industry is now beginning to evolve transformation that has swept other

large economies.

Retailing presently contributes about 10 per cent of India’s gross domestic product (GDP)

and 6-7 per cent of employment. With some 15 million retail outlets, India has the

highest retail density in the world. But only 4 per cent of these outlets are more than 500

sq ft in size and almost all are family owned shops and establishments. The value of

organized retail is expected to grow 2.8 times in the coming four years to Rs 1,000 billion

industries, attracting many global retail chains like Wal-Mart, Tesco, and Carrefour.

Foreign direct investment (FDI) up to 51 per cent in single brand retail was permitted last

year and multi-brand retail is expected to open up to FDI soon. Meanwhile, Indian retail

chains like Reliance Retail, Croma, Aditya Birla group, S Kumars, Shoppers’ Stop,

Westside and Trinethra have all been consolidating their realty, brands, market shares and

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locations. However, to-date there is very little understanding of what the impact of

organised retail will be on the so-called unorganised retail sector and the agricultural

sector (the country’s two largest sources of employment).

The Indian retail market is currently estimated at USD 396 billion. Food segment

contributes largest part of total value of retail market, followed by fashion, leisure &

entertainment and fashion accessories. India's organized retail space is evolving fast and

achieves penetration level of 7 %, which signifies huge potential growth. Indian luxury

market currently stands at USD 3.5billion and expected to grow to make India the

twelfth- largest luxury retail market in the world by 2015

Concerns for small business establishments in townships stems from the fact that they

will now have to compete with national retail chains such as aditya birla, Big Bazar etc

which have large turnover. Small Township retailers are the source of survival for most

township dwellers as they contribute to income generation and employment in the

township. If these businesses are compelled to close down due to increased competition

from large retailers, many jobs would be lost and this has huge implications to business

and township communities. There may be business surviving on or thriving despite the

threat of new entrants in the market.

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ABOUT RETAIL INDUSTRY IN INDIA

Retail is India's largest industry. It accounts for over 10 per cent of the India's GDP and

around 8 per cent of the employment. Retail sector is one of India's fastest growing

sectors with a 5 per cent compounded annual growth rate. India's huge middle class base

and its untapped retail industry are key attractions for global retail giants planning to

enter newer markets. Driven by changing lifestyles, strong income growth and favourable

demographic patterns, Indian retail is expected to grow 25 per cent annually. It is

expected that retail in India could be worth US$ 175-200 billion by 2016.

The organized retail industry in India had not evolved till the early 1990s. Until then, the

industry was dominated by the un-organized sector. It was a seller’s market, with a

limited number of brands, and little choice available to customers. Lack of trained

manpower, tax laws and government regulations all discouraged the growth of organized

retailing in India during that period. Lack of consumer awareness and restrictions over

entry of foreign players into the sector also contributed to the delay in the growth of

organized retailing.

A number of factors are driving India's retail market. These include: increase in the

young working population, hefty pay-packets, nuclear families in urban areas, increasing

working women population, increase in disposable income and customer aspiration,

increase in expenditure for luxury items, and low share of organized retailing. India's

retail boom is manifested in sprawling shopping centres, multiplex- malls and huge

complexes that offer shopping, entertainment and food all under one roof. But there is a

flip side to the boom in the retail sector. It is feared that the entry of global business

giants into organized retail would make redundant the neighbourhood Karana stores

resulting in dislocation in traditional economic structure. Also, the growth path for

organized retail in India is not hurdle free. The taxation system still favours small retail

business. With the intrinsic complexities of retailing such as rapid price changes, constant

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threat of product obsolescence and low margins there is always a threat that the venture

may turn out to be a loss making one.

A perfect business model for retail is still in evolutionary stage. Procurement is very vital

cog in the retail wheel. The retailer has to fight issues like fragmented sourcing,

unpredictable availability, unsorted food provisions and daily fluctuating prices as against

consumer expectations of round-the-year steady prices, sorted and cleaned food and fresh

stock at all times.

Trained human resource for retail is another big challenge. The talent base is limited and

with the entry of big giants there is a cat fight among them to retain this talent. This has

resulted in big salary hikes at the level of upper and middle management and thereby

eroding the profit margin of the business. All the companies have laid out ambitious

expansion plans for themselves and they may be hampered due lack of requisite skilled

manpower.

But retail offers tremendous for the growth of Indian economy. If all the above

challenges are tackled prudently there is a great potential that retail may offer

employment opportunities to millions living in small town and cities and in the process

distributing the benefits of economic boom and resulting in equitable growth.

Table Number – 1.1

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PRESENT INDIAN RETAIL SCENARIO

The retail industry is divided into organized and unorganized sectors. Over 12 million

outlets operate in the country and only 4% of them being larger than 500 sq ft (46m²) in

size.

Organized retailing refers to trading activities undertaken by licensed retailers, that is,

those who are registered for sales tax, income tax, etc. These include the corporate-

backed hypermarkets and retail chains, and also the privately owned large retail

businesses.

Unorganized retailing, on the other hand, refers to the traditional formats of low-cost

retailing, for example, the local kirana shops, owner manned general stores, paan/beedi

shops, convenience stores, hand cart and pavement vendors, etc.

Unorganized market: Rs. 583,000 cores

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Organized market: Rs.5, 000 cores

5X growth in organized retailing between 2000-2005

Over 4,000 new modern Outlets in the last 3 years

Over 5,000,000 sq. ft. of mall space under development

The top 3 modern retailers control over 750,000 sq. ft. of retail space

Over 400,000 shoppers walk through their doors every week

47 global fortune companies & 25 of Asia's top 200 companies are retailers.

Growth in organized retailing on par with expectations and projections of the last 5

Years: on course to touch Rs. 35,000 corers (US$ 7 Billion) or more by 2005-06The

growth factors of the retail sector of Indian economy:

Increase in per capita income which in turn increases the household consumption

Demographical changes and improvements in the standard of living

Change in patterns of consumption and availability of low-cost consumer credit

Improvements in infrastructure and enhanced availability of retail space Entry to

various sources of financing.

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EVOLUTION AND TRENDS IN ORGANIZED RETAILING FORMATS AND RETAIL OUTLETS

Historical Indian retail market consisted of weekly markets, village fairs and mela’s and

the 19th century gave birth to the retail outlets which took the form of convenience stores,

Mom and Pop stores/ kirana stores. This helped the consumers on to stick to a particular

store for their day to day requirements and also avail the credit purchasing facility. And

in the 1980’s people have seen the new formats like supermarket, departmental stores and

discount stores entering into the Indian retail space. In less than a decade hypermarkets

have gained all the applause of the retail market and stood above all the other formats by

bringing in the concept of “one stop shopping.” This stood as an opening door for the

new generation of the retail industry. And very soon the malls became the trend setters in

the new millennium.

This has coined the term of ‘shoppertainment’ (shopping and entertainment) which can

be attributed to the changing life styles of the people.

Hypermarket: It is the largest format in Indian retail so far is a one stop shop for the

modern Indian shopper.

Merchandise: food grocery to clothing to spots goods to books to stationery.

Space occupied: 50000 Square feet and above.

SKUs: 20000-30000.

Example: PETER ENGLAND retail’s Big Bazaar, RPG’s Spencer’s (Giant), Vishal mega

mart.

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Supermarket: A subdued version of a hypermarket.

Merchandise: Almost similar to that of a hypermarket but in relatively smaller

proposition.

Space occupied: 5000 Sq. ft. or more.

SKUs: Around 10000.

Example: Nilgiris, Apna Bazaar, Trinethra/more.

Convenience store: A subdued version of a supermarket.

Merchandise: Groceries are predominantly sold.

Space occupied: Around 500 Sq. ft. to 3000 Sq. ft.

Example: stores located at the corners of the streets, Reliance Retail’s fresh.

Department store: A 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.

Merchandise: Apparel, household accessories, cosmetics, gifts etc.

Space occupied: Around 10000 Sq. ft. – 30000 Sq. ft.

Example: Landmark Group’s LifeStyle, Trent India Ltd.’s Westside.

Discount store: Standard merchandise sold at lower prices with lower margins and

higher volumes.

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Merchandise: A variety of perishable/ non perishable goods.

Example: Viswapriya Group’s Subiksha, Piramal’s TruMart.

Specialty store: It consists of a narrow product line with deep assortment.

Merchandise: Depends on the stores

Example: Bata store deals only with footwear, RPG’s Music World, Crossword.

MBO’s: Multi Brand outlets, also known as Category Killers. These usually do well in

busy market places and Metros.

Merchandise: Offers several brads across a single product category.

Kirana stores: The smallest retail formats which are the highest in number (15 million

approx.) in India.

Merchandise: Mostly food and groceries.

Space occupied: 50 sq ft and even smaller ones exist.

Malls: The largest form of organized retailing today located mainly in metro cities, in

proximity to urban outskirts.

Merchandise: They lend an ideal shopping experience with an amalgamation of product,

service and entertainment, all under a common roof.

Space occupied: Ranges from 60,000 sq ft to 7, 00,000 sq ft.

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In the above graph it shows that the in India the fastest growing retail segment is food

and grocery because in India people spend more on eating. Then dressing because India

is now turning to modern age and the people of modern age like to dress well and look.

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We In the above graph it shows that the there are many formats of retailing in India but

the specialty store and supermarket is fastest growing formats in India.

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Key part of the general corporate strategy

A marketing strategy is most effective when it is an integral component of

corporate strategy, defining how the organization will successfully engage

customers, prospects, and competitors in the market arena. It is partially derived

from broader corporate strategies, corporate missions, and corporate goals. As the

customer constitutes the source of a company's revenue, marketing strategy is

closely linked with sales. A key component of marketing strategy is often to keep

marketing in line with a company's overarching mission statement.

Basic theory:

1) Target Audience

2) Proposition/Key Element

3) Implementation

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MAJOR INDIAN RETAILERS

The low-intensity entry of the diversified Mahindra Group into retail is unique

because it plans to focus on lifestyle products. The Mahindra group is the fourth large

Indian business group to enter the business of retail after Reliance Industries Ltd, the

Aditya Birla Group, and Bharti Enterprises Ltd. The other three groups are focusing

either on perishables and groceries, or a range of products, or both.

RPG Retail-Formats: Music World, Books & Beyond, Spencer’s Hyper, Spencer’s

Super, Daily & Fresh

The Tata Group-Formats: Westside, Star India Bazaar, Steel junction, Landmark, and

Titan Industries with World of Titans showrooms, Tanishq outlets, Chroma.

K Raheja Corp Group-Formats: Shoppers’ Stop, Crossword, Hyper City, in orbit

Lifestyle International-Lifestyle, Home Centre, Max, Fun City and International

Franchise brand stores.

Pyramid Retail-Formats: Pyramid Megastore, TruMart

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Nilgiri’s-Formats: Nilgiri's’ supermarket chain

Subhiksha-Formats: Subhiksha supermarket pharmacy and telecom discount chain.

Trinethra- Formats: Fabmall supermarket chain and Fabcity hypermarket chain

Vishal Retail Group-Formats: Vishal Mega Mart

BPCL-Formats: In & Out

Reliance Retail-Formats: Reliance Fresh

Reliance ADAG Retail-Format: Reliance World

Shoprite Holdings-Formats: Shoprite Hyper

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ORGANISED RETAIL OUTLETS IN BAREILLY

VISHAL MEGA MART

The glory of Vishal Group’s success is the ascent it has come to accomplish in the field

of manufacturing and retailing of readymade garments. The credit for this radiance goes

to its dynamic of directors Mr. Ram Chandra Agarwal & Mrs Uma Agarwal who have

transformed their foresightedness into an unending saga of growth. Identifying the

immense market in fashion garment for the masses the Group has actually established

benchmarks that many others are inspired to follow. Not resting on its laurels, the Group

is busy identifying new avenues of growth and its companies are busy implementing the

expansion plans to cash in on emerging potentials in the changing business environment

of modern India’s enterprise.

The jewel in Vishal Group’s crown is its flagship company Vishal Retail Ltd. a company

engaged in Hyper market stores with an average area of 25,000 to 30,000 sq. ft. through

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an impressive chain of 172 fully integrated stores in spread over the area of more than

24,00,000 sq. ft. in around 110 cities across India in 24 states. The turnover of the

company for 09-10 was 1105 Crore. Maintaining the highest standards in quality and

design, these stores have come to offer the finest fashion garments at down-to-earth price

structure. A fact that is better visible in the constant flow of shoppers all through the year.

Under the title of Vishal Mega Mart these stores have emerged as the regular haunts for

the bargain-hunters and fashion enthusiasts alike.

The saga of Vishal Group dates back to 2001 when its directors foresaw the emerging

potentials in the retail industry which is indeed the largest sector in the global economy.

Imbibing its innovative concepts and techniques the Group identified the vast scope of

growth in retailing for the common man. Its stores have gained an enviable prominence

as being the ideal store for the common man where an extensive variety and quality is

offered at a very, very reasonable price structure. The Group’s expertise in the field of

retail marketing over the years and its focus on regions, cities and exact customer

preferences have earned the Group an undisputed leadership status to Vishal Group.

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BhartiRetail

Bharti Retail is a wholly owned subsidiary of Bharti Enterprises. The Company operates

easy day neighbourhood stores and compact hypermarket stores called easy day Market.

Bharti Retail provides consumers a wide range of good quality products at affordable

prices. easy day stores are one stop shops that cater to every family's day-to-day needs.

Merchandise at easyday Market stores include apparels, home furnishings, appliances,

mobile phones, meat shop, general merchandise, fruits and vegetables among others.

Created on the neighbourhood shop format, the much-awaited retail operations

‘EasyDay‘was introduced by Bharti Retail Limited at Bareilly in UttarPradesh. Bharti

Retail Limited happens to be a wholly-owned subsidiary of Bharti Enterprises and its

Easy Day retail operations will act as a one-stop shop catering to a family’s day-to-day

needs.

As such, the Easy Day Stores will provide Indian consumers a wide range of products of

excellent quality apart from proffering a nice ambience and service. Among the range of

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items you can look forward to buying from the EasyDay stores include personal care

products, stationery, household articles, hosiery items, daily-need groceries like staples,

processed foods, bakery and dairy products, meat and poultry and fresh produce.

It was announced by the company that EasyDay will gives jobs to the locals in the

Ludhiana area where it has been set up. Further on those who will be selected for the job

will be trained by Bharti Academy of Retail, which has been established by Bharti Retail

Limited. This academy has already trained about 1,800 local people from different

sections of the society.

KUMAR STORES

4-Station RoadBareilly,

UttarPradesh,

Phone No: +91-135-2653145 +91-9837034784

Email: [email protected]

Directions: It Is Located On Station Road,

Hours of Operation: 8:30 Am To 8:30 Pm

Closed: Sunday

Payment Type: Cash, Visa, Master Card

Business Description

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It Deals In All Kinds Of Cosmetics, Gift Novelties, White Metal, Toys, Decorative

Pieces, Home Appliances, Stationery And All Other Items Of Daily Need.

Kaveri Departmental Store

38, Shubhash Nagar, Badaun Road

Bareilly,UttarPradesh,

Phone No: +91-135-2625514

Directions: It Is Located At Bajpeyi chowk,

Hours of Operation: 10:00 Am To 8:30 Pm

Closed: Sunday

Payment Type: Cash, Visa, Master Card

Business Description

All Types Of Utility Items Of Domestic Purposes Can Be Purchased From Here.

Scope of the study:-

The scope of this study is wide and valuable. The study helps to attain customer

satisfaction towards organized and unorganized outlets which is very essential for

retailers to find out the various problems related with retail store product mix.

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Objective :-

The research objectives for the project undertaken can be defined as follows:

1) To identify the determinants of customer satisfaction in the organized and unorganized

retail outlets in the city.

2) To identify the attitude and behavior of customers in organized & unorganized retail

outlets.

3) To know the major factors considered by customers while shopping in retail

shops.

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CHAPTER 2

Literature Review

Diagnosing Customer Satisfaction towards the organized and unorganized retail,

Delhi Business Review X Vol. 9, No. 1 (January - June 2013), Reetesh Kumar Singh,

Aditya Prakash Tripathi.

Abstract

Organized retail sector has witnessed a CAGR of around 35 per cent over the past five

years and currently contributing around 10 per cent to the country.s GDP & eight percent

of the employment. The Retail Sector is seeing investments of up to Rs. 6000 crore by the

20 prominent retail players. On the other hand (A report by Govt. of India in 2004 by the

centre for policy alternatives entitled FDI in India’s retail sector: More bad than good.

stated that) retailing is .probably the primary form of disguised unemployment,

underemployment in the country. India has 35 towns each with a population of over one

million. If Wal-Mart were to open an average Wal-Mart store in each of these cities and

they reached the average Wal-Mart performance per store, we are looking at a turnover of

over Rs. 80, 330 million ($1.82 billion) with only 10,195 employees. Extrapolating this

with the average trend in India, it would mean displacing about 4, 32,000 persons. If

large retailers were to obtain 20 per cent of the retail trade, .this would mean a turnover

of Rs. 800 billion ($ 18 billion) at current market price. And of course, would mean an

employment of just 43,540 persons displacing meanly eight million persons employed in

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the unorganized retail sector.Understanding the importance of the issue, the present study

is aimed to investigate the impact of Malls on small shops and Impact of organized

retailing upon sales performance, employment generation and loss of social interest with

the emergence of organized retailing with special reference to Delhi and NCR.

Survival Strategy for Traditional retailers in the era of Modern Retailing, Asia

pacific journal of social sciences Vol I (2) June- December 2013 pp 198-203, H. C

Purohit, Kavita.

Abstract

India is the fastest growing market in the Asia Pacific for international tourist spending.

The economy is growing by over 8% a year and indias growth rate can actually exceed

that of China by 2015. Favourable demographic and psychographic changes relating to

indias consumer class international exposure, availability of quality retail space, wider

availability of products and brand communication are some of the factors that are driving

the retail in India. Development of India as a sourcing hub shall further make India as an

attractive retail opportunity for the global retailers. Retailers like Wal Mart, GAP,

Tesco,JC Penny, H&M etc stepping up their sourcing requirements from India and

moving form third party buying offices to establishing their own managed sourcing office

shall further make India an attractive retail opportunity.

Increasing growth of modern retailing in across product categories, food and grocery, wet

grocery, apparel and jewellery etc are the areas where lucrative opportunity for modern

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retail exists. The traditional retailers have the challenges in the era of Modern Retailing.

The proposed study covers the issues related to growth of modern retailing and the

perception of traditional retailers about modern retailing.

Impact of Organized Retailing on Unorganized Sector with reference to customer

saticefaction Working paper ICRIER, 222 (2012). Joseph Mathew, Nirupama

soundararajan, Manisha Gupta,and Sanghamitra Sahu

Abstract

The retail business, in India, is estimated to grow at 13 per cent per annum from US$ 322

billion in 2006-07 to US$ 590 billion in 2011-12. The unorganized retail sector is

expected to grow at about 10 per cent per annum from US$ 309 billion 2006-07 to US$

496 billion in 2011-12. Organized retail which now constitutes a small four percent of

retail sector in 2006-07 is likely to grow at 45-50 per cent per annum and quadruple its

share of total retail trade to 16 per cent by 2011-12. The study, which was based on the

largest ever survey of all segments of the economy that could be affected by the entry of

large corporate in the retail business, has found that unorganized retailers in the vicinity

of organized retailers experienced a decline in sales and profit in the initial years of the

entry of organized retailers. The adverse impact, however, weakens over time. The study

has indicated how consumers and farmers benefit from organized retailers. The study has

also examined the impact on intermediaries and manufacturers. The results are indicative

of the mega-and-minimetro cities around a limited number of organized retail outlets.

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Based on the results of the surveys, the study has made a number of specific policy

recommendations for regulating the interaction of large retailers with small suppliers and

for strengthening the competitive response of the unorganized retailers.

Organized retailing in India – challenges and opportunities, International Journal

of Multidisciplinary Research Vol.2 Issue 1, January 2012, Dr. Shahid Akhter;

Iftekhar Equbal

Abstract

Indian Retail Industry is ranked among the ten largest retail markets in the world. The

attitudinal shift of the Indian consumer and the emergence of organized retail formats

have transformed the face of Retailing in India. With the sign of reemergence of

economic growth in India, consumer buying in retail sector is being projected as a key

opportunity area. As a consequence, Indian corporate houses are refocusing its strategic

perspective in retail marketing with the idea to use resources optimally in order to create

core competence and gain competitive advantage. The paper theme is to analyse finer

strategic perspective for the retail sector in India and suggest measures so that the

corporate strategists could incorporate the same both qualitatively and quantitatively.

Based upon the qualitative judgment, a retail unit may be given an overall understanding

about the expected performance that can further be corroborated by quantitative analysis.

Retail trade has emerged as one of the largest industry contributing to employment

generation, revenue generation, increased turn over and many more. Organized retailing

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is showing signs of enormous creativity. It. has emerged as one of the most dynamic and

fast paced industries with several players entering the market. As a matter of fact retailing

in India is gradually edge its way towards becoming the next boom industry. This paper

provides detailed information about the growth of retailing industry in India. It examines

the growing awareness and brand consciousness among people across different socio-

economic classes in India and how the urban and semi-urban retail markets are

witnessing significant growth. The paper includes growth of retail sector in India,

strategies, strength and opportunities of retail stores, retail format in India, recent trends,

and opportunities and challenges. This paper concludes with the likely impact of the entry

of global players into the Indian retailing industry. It also highlights the challenges faced

by the industry in near future

Impact of Malls on Small Shops and Hawkers, Economic and Political Weekly June

2, 2007, Anuradha Kalhan

Abstract

A small sample survey of the impact of malls on small shops and hawkers in Mumbai

points to a decline in sales of groceries, fruits and vegetables, processed foods, garments,

shoes, electronic and electrical goods in these retail outlets, ultimately threatening 50 per

cent of them with closure or a major decline in business. Only 14 per cent of the sample

of small shops and hawkers has so far been able to respond to the competitive threat of

the malls with the institution of fresh sales promotion initiatives.

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Customer perception & Satisfaction towards the organized and unorganized retail

Journal of Management Sciences, Vol. 1(1), 7-13, August (2012), Gupta Himanshu1

Dubey Neetu and Patani Pawan.

Abstract

Retail is currently the flourishing sector of the Indian economy. This trend is expected to

continue for at least the next two three decades, and it is attracting huge attention from all

entrepreneurs, business heads, investors as well as real estate owners and builders.

Availability of quality, retail space, wider availability of products and brand

communication are some of the factors that are driving the retail in India Retail sector is

also supporting to create huge employment while a new form of organized retail sector

has emerged within the retail industry and it gave speedy phase to Indian retail sector.

The rationale of the study is twofold: First, to examine the nature of changes in the retail

sector taking place due to organized form of retailing and implications of shift to this new

form of retailing. Secondly, this area has remained largely an unexplored part of research

till date especially in the Indian context. The broad objective of the study is to understand

consumer behavior towards organized and unorganized retail stores and to find out the

consumers satisfaction level from organized retail stores as well as unorganized retail

stores. The perception of the traditional retailers about the modern retailing. The study

uses primary data collected through in depth qualitative analysis to represent organized

and unorganized retails sectors respectively.

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Organized and unorganized retail in India - Drivers facilitator and SWOT analysis,

Asian journal of management research, ISSN 2229 – 3795, Deepika Jhamb, Ravi

Kiran

Abstract

The Indian retail sector is witnessing tremendous growth with the changing

demographics and an increase in the quality of life of urban people. Retail Sector is the

most booming sector in the Indian economy. With a growing economy, improving

income dynamics, rising awareness, and a youth-heavy customer base, India is well on its

way to become one of the most prospective markets for the domestic and global retailers.

The main objective of this paper is to strategically analyze the Indian retail Industry. The

present paper identify the drivers which affect the growth of the Indian retail market,

looks at the major factors affecting the retail business and to carry out the SWOT analysis

of organized retail in India. The results of the study depict that infrastructure, economic

growth and changing demographics of consumers are the major driver of organized retail

in India. The location of the retail store, management style and adequate salaries to

personnel enhance the effectiveness of retail business and are important factors for

retailers’ success.

Ramanathan .V (2009) “The New Face of Unorganized Retailers in India: From

Convenience to Category Killer” the ICFAI 10M-2009-05-08-01.

Abstract

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The unorganized retailers need to be responsive to the competitive retail market dynamics

created by the organized retail formats in order to sustain their business and serve their

target customers in a profitable manner. The change process requires the unorganized

retailers to reshape their existing business practices of dealing in a limited variety of

product alternatives to offering the complete assortment in the product categories handled

by them. This `category killing' approach would become imperative for the continued

survival of unorganized retailers. If the unorganized retailers adopt this approach,

together with the various forms of convenience that they already offer, they would be

able to stand up to the competition from the organized retail formats.

Mulky A. and Nargundkar R (2003), “Modernization in Indian Retailing:

Managerial and Policy perspectives”, In Udyog Pragati, vol. 27, no.2, pp. 1-8, April-

June 2003

Abstract

The Indian retail sector is largely traditional, but stores in modern format are emerging.

The contribution of organized retailing in the share of retail sales in India is currently

very small. Based on an analysis of retail developments in countries such as Thailand,

Brazil and Greece, and some experience in India, it is possible to conclude that

modernization of retailing in India would be influenced by some important factors. These

factors include economic development; improvements in civic situation; changes in

consumer needs, attitudes and behavior; changes in government policies; increased

investment in retailing and rise in the power of organized retail. Modern retail will have

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several implications for managerial practice in manufacturing firms. Firms will need to

proactively review and their sales structures, brand activities, logistics policy and price

structure to cope with pressures from powerful retailers.

Sinha Piyush Kumar & Kar Sanjay Kumar (2007) “An Insight into the Growth of

New Retail Formats in India” IIM-Ahmadabad Research and publication W.P. No.

2007-03-04

Abstract

India’s retail development is inevitable. Most of the organized retailers in India are

harping on quality, service, convenience, satisfaction and assured benefits to lure

shoppers into the store. Retailers should create value for the consumer and must decide

suitable vehicle to deliver desired consumer value. No doubt, that retail format is one of

the vehicles to deliver value proposition and it helps to position the store in the mind of

target shoppers. Retailers need to find out what matches consumer requirement and offer

better than competition. Retailers certainly need to be innovative in designing the value

proposition and deciding the format to deliver that to the consumer. It is not all about

deciding the format but all about serving the consumer better, faster and at less cost.

Retailers can use their store as an indicator of what they stand for and what value they

offer. Retailers have to out think consumer in providing service and value. Now, most of

the retailers are concerned about growth in number of stores rather than creating value for

consumer.

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According to Piyush Kumar Sinha (2007), the demand from the convenience-seeking

shoppers, technology, competition and urge to growth leads the retailer to adapt the

multiple format modes. The development will no doubt bolster the retailer's power in

market creating positive synergy across the formats. However, at the same time, it brings

with more responsibility to the retailer, as shoppers are going to interact and judge the

value offering dissimilar shopping occasion and environment. The value delivery

mechanism of the retailer need to be consistent and reinforcing to maximize its brand

equity, failing which, it stands the risk of dilution. The opportunity lies in the fact that,

retailers of a particular format appear to be increasingly successful in attracting customers

from a widened variety of formats.

Electronic retailing created a huge scope for the store-based retailer to reach out to a large

customer base, overcoming the physical distance, by using technologically driven

formats. Converting the threats into opportunities, the pure e- retailers are opening

physical format and there by complementing the existing operation. It also in turn helps

in operational and financial efficiency through economies of scale and greater bargaining

power against the manufacturers. The scope of positive synergy in terms of brand,

customer, merchandise and marketing activities are very much a reality in retailing.

31SUMIT SAXENA


CHAPTER 3

RESEARCH DESIGN

A research study conducted scientifically has a specific framework of research from the

problem identification to the research study. The framework of conducting the research is

known as Research Design.

Research Design is the blue print of any problem. It is a plan for collection, analysis and

interpretation of data in a manner that is relevant to the research purpose with economy in

procedure.

After defining the research problem in a clear-cut terms it will be required to prepare such

a research design which will state the conceptual structure within which the research

would be conducted.

In this research dependent variable is competitors while independent variable is price,

taste, nutrition and packaging.

The study is descriptive because:

1. A survey is conducted at Bareilly.

32SUMIT SAXENA


2. The project undertaken is based upon the secondary data – the internal sources: name

of shopkeepers located in different areas of Bareilly, company broacher. External

sources – Internet, news paper, websites etc.

3. A new field of research has been approached which was earlier not tested.

Descriptive research studies are those studies which are concerned with describing the

characteristics of a particular individual, or a group.

Design in such studies must be rigid and should not be flexible and must pay attention on

the following:

• Formulating the objective of the study,

• Designing the method of the data collection,

• Selecting the sample,

• Collecting the data,

• Processing and analyzing the data,

• Reporting the finding.

DATA COLLECTION :

The task of data collection begins after a research problem has been defined and research

design has been chalked out while decided about the method of data collection to be used

for the study we must know that there are basically two types of data Primary data and

Secondary data.

33SUMIT SAXENA


Secondary Data: The secondary Data has been collected from production house

itself. The data collected for the project undertaken gives the information about the sales

measures and practice applied for selling the goods. The data has been allocated from

various information channels like company’s websites –about the products and offers &

different strategies, business magazines, news websites etc.

During my research I collected secondary data from various sources i.e data from

company broacher, from company’s website, data with respect to retail industries from

magazines and news paper.

The data that I collect from different secondary sources help alot during my study.

Primary data: The researchers collected primary data during the course of research

period with the help of the questionnaire that was designed for the consumers to collect

the information that was required to carry out the research.

I collect primary data through questionnaire. I visit various locations at Bareilly.

Questionnaire is filled by consumers. During my survey I found that respondents are not

much comfortable with the questionnaire, some of the respondents taking interest

whereas most of them fell shy or taking seriously. For filling the questionnaire I stand at

various retail stores located in various locations of Bareilly and whenever any customer

come to that shop, I tried to conveyance him/her for the purpose of my study. Sometime

rain plays a role of hurdle during my research study.

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Sampling Method and Sample Size:

Two retail outlets and two kirana stores in Bareilly were randomly selected for this study.

Twenty five visiting customers from each outlet were personally interviewed with the

help of especially structured questionnaire. In this way 100 customers were interviewed

for the study.

Methodology

The study involves the primary data which is collected through questionnaire,

interview, and observation.

It involves use of secondary sources such as web and other research articles

printed by various financial institutions and other journals and magazine.

It involves analysis and tabulation of data which is collected from customers is

done by various means such as line graphs, pie charts and bar graphs.

The project involves the study of customer’s perception.

Methods of collecting data

The data used in this research were collected through the following sources:

1. Data was retrieved from online registered websites.

2. From the management report of companies on internet.

3. From the customer.

35SUMIT SAXENA


4. From other literature available at the company.

5. From literature available at websites.

6. Journals and news papers.

THE RESEARCH REPORT

The report is the result of a survey which was undertaken in Bareilly City. The

objectives of the project have been fulfilled by getting response from the customer as

well as retailers associated to these segments through a personal interview in the form of

a questionnaire. The responses available through the questionnaire are used to evaluate

the satisfaction and the willingness of the customer to purchase products from organized

as well as unorganized. The project also covers an analysis of the switch over of

customers to different retail market.

THE RESEARCH DESIGNThe research design used in the project is exploratory design. The investigation is

carried upon the customers in organized and unorganized. The reason for choosing this

design is to get responses from the customers so that their perception about the products

of the company and their loyalty could be predicted.

THE AREA OF WORK

The field work is conducted in the Bareilly city at various different locations. Retailers

shop situated in different location all over the city.

THE ANALYTICAL TOOLS USED36

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The analytical tools used are mostly graphical in nature which include

Pie charts

Cylindrical charts

Column charts

Tables showing percentage

37SUMIT SAXENA


CHAPTER 4

DATA ANALYSIS &

INTERPRETATION

Analysis of Data:

Customers’ perception towards different aspects of retail outlets and kirana stores were

compared using observation method. Before going in for analysis, the Likert Scale

attributes were assigned weights as under:

1 For highly Satisfied

2 For Satisfied

3 Can’t Say

4 Dissatisfied

5 Highly Disatisfied

The results obtained through data analysis have been discussed in the paper.

.

38SUMIT SAXENA


Q1. What type of retail stores you prefer?

A) Organized

B) Unorganized

C) Both


Preference towards retail store Percentage of respondent

Organized 17%

Unorganized 34%

Both 49%

Organized 17%

Unorganized34%

Both49%

Preferance towards retail store

INTERTERPRETATION:

Out of 100 samples, majority of them are select both(49%). only organized sector

choose by17 % and the remaining o thers have are wi th

unorganized(37%).39

SUMIT SAXENA


Q2. If organized then what type of organized stores?

A) Branded Showrooms

B) Malls

C) Both


Preference towards organized retail store Percentage of respondent

Branded showrooms 29%

Malls 27%

Both 44%

Branded Showrooms

29%

Malls27%

Both44%

Preferance towards organized retail store

INTERTERPRETATION:

Out of 100 samples, majority of them are select both(44%). only Branded

showrooms choose by29 % and the remaining o thers have are wi th

Mal ls (27%).

40SUMIT SAXENA


Q3. If Unorganized then what type of unorganized stores?

A) Kirana Shops

B) Small society shops

C) Both


Preference towards unorganized retail store Percentage of respondent

Kirana shops 28%

Small society shops 30%

Both 42%

Kirana Shops 28%

Small society shops 30%

Both42%

Preferance towards unorganized retail store

INTERTERPRETATION:

Out of 100 samples, majority of them are select both(42%). only Kirana shops

choose by28 % and the remaining o thers have are wi thmal l soc ie ty

shops(30%).

41SUMIT SAXENA


Q4. Which store do you find more comfortable for shopping?

A) Organized

B) Unorganized


Comfortable store for shopping Percentage of respondent

Organized 37%

Unorganized 63%

Organized 37%

Unorganized 63%

Comfortable store for shopping

INTERPRETATION:

Out of 100 samples only 37 customers are feeling comfortable at organized retail

shops and rest 63 are comfortable at unorganized retail shops. Through this

data we can interpret that majority are feeling comfortable at unorganized retail

shops.

42SUMIT SAXENA


Q5.Rank your satisfaction level both at organized and unorganized retail store.?

1 for Highly Satisfied

2 for Satisfied

3 for Can't say

4 for Dissatisfied

5 for Highly Dissatisfied


Organized Unorganized

Factor 1 2 3 4 5 1 2 3 4 5

Attributes 19 17 31 23 10 11 20 29 26 14

Quality of products 43 25 17 10 5 30 38 14 12 6

Variety of products 58 23 10 8 1 15 23 27 26 9

Availability of products 34 19 29 16 2 7 39 25 21 8

Stacking of products 29 25 23 19 4 11 26 29 20 14

Visually attractive Store 43 25 17 10 5 6 12 14 38 30

Ambiance 58 23 10 8 1 1 1 27 48 23

Spacious shop floor 34 19 29 16 2 7 6 25 21 41

Parking 36 34 4 19 7 5 11 29 45 10

Location 14 17 37 25 7 37 42 3 17 1

Flexibility in payment mode 58 23 10 8 1 24 39 2 19 16

Convenient billing counters 34 29 19 16 2 2 8 25 47 18

Operating time 57 24 11 7 1 45 32 5 13 5

43SUMIT SAXENA


Cleanliness of store 47 35 12 6 0 12 34 21 30 3

Sincere to solve customer problem

58 23 10 8 1 24 39 2 19 16

Individual attention 34 29 19 16 2 18 43 13 18 8

Willingly handle exchanges 23 24 11 39 3 44 32 5 14 5

Staff presentable 45 37 12 5 1 11 33 23 30 3

Price of products 23 35 10 22 10 24 39 13 14 10

Promotion offers 34 28 19 17 2 5 11 13 46 25

44SUMIT SAXENA


Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Attributes Quality of products

Variety of products

Availability of products

0%10%20%30%40%50%60%70%80%90%

100%

Highly DissatisfiedDissatisfiedCan't saySatisfiedHighly Satisfied

INTERTERPRETATION:

Attributes- From Organized sector customer highly satisfied and satisfied. But from

unorganized sector customers are dissatisfied and highly dissatisfied.

Quality of products- From Organized sector customer highly satisfied and satisfied. But

from unorganized sector customers are dissatisfied and highly dissatisfied.

Variety of products- From Organized sector customer highly satisfied and satisfied. But

from unorganized sector customers are dissatisfied and highly dissatisfied.

Availability of products- From Organized sector customer highly satisfied and satisfied.

But from unorganized sector customers are dissatisfied and highly dissatisfied.-

45SUMIT SAXENA


Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Stacking of products

Visually at-tractive Store

Ambiance Spacious shop floor

0%10%20%30%40%50%60%70%80%90%

100%


INTERTERPRETATION:

Stacking of products- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied.

Visually attractive Store- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied.

Ambiance From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied.-

Spacious shop floor- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied.

46SUMIT SAXENA


Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Parking Location Flexibility in payment

mode

Convenient billing coun-

ters

0%10%20%30%40%50%60%70%80%90%

100%


INTERTERPRETATION:

Parking- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied.

Location- From unorganized sector customer highly satisfied and satisfied. But from organized sector customers are dissatisfied and highly dissatisfied.

Flexibility in payment mode- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied.

Convenient billing counters- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied .

47SUMIT SAXENA


Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Operating time

Cleanliness of store

Sincere to solve cus-

tomer prob-lem

Individual at-tention

0%10%20%30%40%50%60%70%80%90%

100%


INTERTERPRETATION:

Operating time- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied

Cleanliness of store- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied

Sincere to solve customer problem- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied

Individual attention- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied

48SUMIT SAXENA


Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Org

anize

d

Unor

gani

zed

Willingly handle

exchanges

Staff pre-

sentable

Price of products

Promotion offers

0%10%20%30%40%50%60%70%80%90%

100%


INTERTERPRETATION:

Willingly handle exchanges- From unorganized sector customer highly satisfied and satisfied. But from organized sector customers are dissatisfied and highly dissatisfied.

Staff presentable- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied

Price of products From unorganized sector customer highly satisfied and satisfied. But from organized sector customers are dissatisfied and highly dissatisfied.

Promotion offers- From Organized sector customer highly satisfied and satisfied. But from unorganized sector customers are dissatisfied and highly dissatisfied

49SUMIT SAXENA


CHAPTER 5

FINDINGS, RECOMMENDATION AND

LIMITATIONS

FINDINGS

1. In this study it is found that 63% customers prefer to purchase from unorganized

retail outlets as compare to organized retail outlets.

2. During the study it comes to know that customers are satisfied with extra facility

provide by organized retail outlets.

3. In this study it is found that organized retail outlets provide better quality, product

range as compare to unorganized retail outlets.

4. In this study it is observed that in future the market share of unorganized retail will

reduce 60% - 80%, because Customers shifting from unorganized retail outlets to

organized retail outlets.

5. During study it is observed that these organized retail outlets attracting the middle

& upper class customers, the lower class person still prefer to purchase from the

local Kirana Stores.

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6. The findings of the study conclude that 80% of the customers are youngsters aged

between 16-25 and among them more males from the urban sector visit mega

marts.

7. From the utility point of view, A large number of customers were more oriented

towards safety and parking facilities.

8. About 35% - 40% of peoples are least bothered about guarantee and warrantee as

compared to quality and discount that they prefer more.

SUGGESTIONS

1. The organized retail outlets should improve the willingly exchanges provide to

customers.

2. The organized retail outlets should provide the free home delivery facility.

3. The unorganized retail outlets should increase the no. of billing counters in their

outlets.

4. The organized retail outlets should also provide the credit facility to the lower

class customers so that they can increase their market share.

5. The organized retail outlets should also provide the mobile van facility in the areas

which are far away from the stores.

6. To attract the rural sector customers, mega marts may extend their advertisements

offering special sale promotion schemes to the rural areas.

7. The customers are dissatisfied with the safety and parking facilities at the

unorganized retail. Therefore, they should concentrate on developing these aspects 51

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properly, besides extending more cash discount and free gifts schemes to attract

the customers at a higher level.

8. The unorganized retail store should focus on quality, discount and attractive

display of products, as these are very important factors considered by the

customers while making purchase decisions.

LIMITATION

Due to the constraints of time, the study was confined to BAREILLY city.

The sample was taken on the basis of convenience; therefore the shortcomings of

the convenience sampling may also be present in this study.

The sample size chosen for the purpose was only indicative and not exhaustive

owing to time constraints.

There were some inherent limitations as far as collection of data is concerned. The

respondents replied may be biased in favour of their centres.

CONCLUSION

The crux of the study is that most of the customers prefer to purchase from unorganized

retail outlets as compare to organized outlets. Also its found that most of the respondents

are satisfied with the quality, price and product range of the goods provided by

unorganized retail outlets. In this study it is found that customers want to spend more at

organized retail outlets in comparison to other local Kirana stores. During the study its

also found that customers were happy from the services provided by organized outlets.

52SUMIT SAXENA


ANNEXURE

BIBLIOGRAPHY

BOOKS AUTHORS

Marketing Management : Philip Kotler

Marketing Research : D. D. Sharma

Research Methodology : C. R. Kothari

Websites

www.vishalmegamart.net

www.easyday.in

www.wikipedia.com

53SUMIT SAXENA


Questionnaire

A Study on Customer Satisfaction towards the organized and unorganized retail

Name-

Gender- Male ( ) Female ( )

Age Group- <15 yrs. ( ) . 15 – 20 yrs. ( ) . 21 – 30 yrs.( ) 31 – 40 yrs.( ) >40 yrs.( )

Education- High school ( ) Intermediate ( ) UG ( ) PG ( ) PHD. ( )

Monthly Income- <5000 ( ). 5000 – 10000 ( ).10000 - 20000 ( ). 20000 – above

Q1. What type of retail stores you prefer?

A) Organized

B) Unorganized

C) Both

Q2. If organized then what type of organized stores?

A) Branded Showrooms

B) Malls

C) Both

Q3. If Unorganized then what type of unorganized stores?

A) Kirana Shops

54SUMIT SAXENA


B) Small society shops

C) Both

Q4. Which store do you find more comfortable for shopping?

A) Organized

B) Unorganized

Q5.Rank your satisfaction level both at organized and unorganized retail store.?

1 for Highly Satisfied

2 for Satisfied

3 for Can't say

4 for Dissatisfied

5 for Highly Dissatisfied

Organized Unorganized

Factor 1 2 3 4 5 1 2 3 4 5Attributes Quality of products Variety of productsAvailability of productsStacking of productsVisually attractive StoreSoft AmbianceSpacious shop floor ParkingLocationFlexibility in payment modeConvenient billing counters Operating timeCleanliness of storeSincere to solve customer problemIndividual attentionWillingly handle exchangesStaff presentable

55SUMIT SAXENA


Price of productsPromotion offers

56SUMIT SAXENA

Date post:	22-Jan-2015
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