Management Thesis_Final Report

8/2/2019 Management Thesis_Final Report

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A THESIS ON

A COMPARATIVE ANALYSIS ON THE IMPACT OF

ORGANIZED RETAIL STORES ON EXISTING SMALL

DOMESTIC ESTABLISHMENTS IN VADODARA CITY

WITH SPECIAL EMPHASIS ON FOOD, GROCERY AND

APPAREL PRODUCTS

SUBMITTED BY : KARAN KAPOOR

ENROLLMENT NUMBER : 8NBVD059, SEM - IVUNIVERSITY ID : 0801212842SUBMITTED TO : Mr. AMOL RANADIVE


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A THESIS ON

A COMPARATIVE ANALYSIS ON THE IMPACT OF

ORGANIZED RETAIL STORES ON EXISTING SMALL

DOMESTIC ESTABLISHMENTS IN VADODARA CITY

WITH SPECIAL EMPHASIS ON FOOD, GROCERY AND

APPAREL PRODUCTS

By

KARAN KAPOOR

8NBVD059

SUBMITTED TO: Mr. AMOL RANADIVE

A Report submitted in partial fulfillment of

The requirement of

The MBA PROGRAM

(The Class of 2010)


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CERTIFICATE

This is to certify that the Management Thesis titled

______________________________________________________________________

___________________________________submitted during Semester

_________________ of the MBA Program (The Class of 2010) embodies original

work done by me.

Signature of the Student

Name (in Capitals) : ________________________________________________

Enroll Number : ________________________________________________

Campus : ________________________________________________

Signature of the Faculty Supervisor

Name (in Capitals) :

Designation :

Campus :


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TABLE OF CONTENTS

Acknowledgement..5

Summary....6

Abbreviations...7

Introduction..8

Objectives10

Review of literature..11

Review of Related Theoretical Concepts..40

Research Methodology....42

Analysis...44

Conclusion.50

Recommendations / Suggestions......53

Appendices....54

References.61


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ACKNOWLEDGEMENT

I am thankful to Mr. AMOL RANADIVE, faculty supervisor who has

helped me and encouraged me in doing Management Thesis on A

comparative analysis of the impact of organized retail stores on existing

small domestic establishments in Vadodara city with special emphasis on

food, grocery and apparel products. He not only guided me throughout the

project but also gave me a constant encouragement, which instilled in me a

confidence to make the best out of this project. I am indebted towards himfor taking time from his very busy schedule to guide me at every stage. Mr.

RANADIVE has provided me constant support and complete independence

in conducting the project. Also my sincere gratitude and thanks to all the

respondents for their valuable support and cooperation. I am deeply

indebted to them.

Knowledge is of no use, unless you know the way to express it. I havelearnt this over the years from great number of people. Special thanks to all

my instructors in life, who have contributed in shaping my career.

I am grateful to almighty God, because he has given me strength and

wisdom for the study.

Karan Kapoor


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SUMMARY

From this management thesis I came to know about organized and

unorganized retail stores.

I critically analyzed the impact of organized retail stores on small

domestic establishments.

In order to get quality information, I used questionnaire as a tool

which helped me in this management thesis.

To collect this particular type of data a questionnaire was been

administered to take the personal interview of the small retailers of

Vadodara.

After collection of the desired data, the data has been compiled and

analyzed with the help of various statistical tools to draw conclusion

out of mathematical data.

The collected data has been categorized and presented in to the

meaningful diagrammatic presentations following its proper

classification. All these analytical information is subjected to the

conclusions following justified interpretation of the results drawn from

the statistical tools.


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ABBREVIATIONS

SKU - Stock Keeping Units

MBO - Multi Brand outlets

FDI - Foreign Direct Investment

GDP - Gross Domestic ProductFMCG - Fast Moving Consumer Goods

RPG - Ramah Prasad Goenka

C & C stores - Cash & Carry Stores

ET - Economic Times

PRIL - Pantaloon Retail India limited

RRL - Reliance Retail Limited

LVMH - Louis Vuitton Moet Hennessy Group


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INTRODUCTION

Retail is being hailed as Indias industry of the future, incited by the

countrys huge urban middle class population. Food and grocery is the

second-largest segment of the retail industry and the potential for new

entrants in this segment is enormous, particularly in untapped markets like

rural and semi-rural areas.

Growing at the rate of 30%, the Indian food retail is going to be the

major driving force for the retail industry. The paper on FOOD RETAIL

AN EMERGING FACET maps out the Background of food retailing as wellas current scenario catching up the retail front, up-and-coming multiple

formats of food retail.

The food industry is on a roller coaster ride as Indians continue to

have a feast, fuelled by large disposable incomes the food sector is

witnessing a remarkable change in consumption patterns, especially in

terms of food. Food retailing has come of age from a period when food

items were sold in small road side grocer shops & mandis, haats and

bazaars by vendors to a stage when food products (processed andgroceries) are retailed through supermarket stores where consumers can

inspect, select and pick up the products they like in a comfortable

ambience and still pay a fair price for the product and the merchandise and

sometimes even pay less than the price they would have paid at the

nearest food stores. Shopping for groceries is no longer a strenuous and

uncomfortable affair.

Instead, it is a pleasurable experience. From simple trading activity,

food retailing is now heading to the status of an industry. Imagine yourself

walking through the air conditioned lanes smelling fresh food and

groceries, enjoying light music, experiencing five star ambiences and above


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all buying food products (vegetables, spices and beverages) without

bargaining with the vendors. Food retail has surpassed the dominating

apparel and accessories sector. "Contrary to the belief that fashion is the

largest segment of organized retail in India, food & beverages is the

major segment, worth Rs 8,97,000 crore," said Arvind Singhal, Chairman,Technopak, at the Indian Retail Forum held in Mumbai.

There is an old industry saying that

CUSTOMERIS KING

retailers today had updated that saying to

CUSTOMERS IS THE DICTATOR

because of fierce competition, new technology and business practices the

market power of customer is strong and growing stronger.


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OBJECTIVES

To understand the structure of the unorganized retail and organizedretail.

To understand the strategies adopted by the organized retailer inIndia for maximum market penetration.

To examine its impact on unorganized retailer with emphasis on

revenue, profit, employment and level of competition.

To know various initiatives taken by small domestic establishments tocounter competition.

To study the market share of retailers existing in the market.

To apply the theoretical knowledge gained throughout academiccurriculum.

In this thesis, I shall apply my best knowledge, theories, managementconcepts and models to the corporate world and find solutions toproblems/issues, which I have learnt till date.


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REVIEW OF THE LITERATURE

The research process involved a two tier process. The first involvedcomplete survey of previous work published, in my case survey of articlesand second, collecting primary data for analysis from existing smalldomestic establishments.

The development of the literature review requires four stages as follows:

Stage: 1 Problem Formulation

With the increased globalization and liberalization policies adopted by theGovt. of India since 1990s, the domestic establishments (Kirana Shops) inIndia have been facing a tremendous competition in terms of customerretention and expanding their reach to new customers. The new organizedretail segment has been posing a severe threat to these grocery storesexisting since centuries in form of Haats in the Indian markets. The studyis aimed to find a solution about estimating the degree of dominancethat this upcoming organized retail segment is going to establish oversmall domestic establishments.

The study will also help the domestic establishments to understandand optimize their service strength and become polymorphic to sustainagainst this growing giant.

Stage: 2 Literature Search

The real GDP is expected to grow at 8-10 % per annum in the next fiveyears. As a result, the consuming class with annual household incomesabove Rs. 90,000 is expected to rise from about 370 million in 2006-07 to620 million in 2011-12. Consequently, the retail business in India isestimated to grow at 13 per cent annually from US$ 322 billion in 2006-07 to US$ 590 billion in 2011-12.


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A research conducted by ICRIER shows -

The unorganized retail sector is expected to grow at about 10 percent per annum with sales rising from US$ 309 billion in 2006-07to US$ 496 billion in 2011-12.

Given the relatively weak financial state of unorganized retailers,and the physical space constraints on their expansion prospects,this sector alone will not be able to meet the growing demand forretail.

Hence, organized retail which now constitutes a small 4% oftotal retail sector is likely to grow at a much faster pace of 45-50% per annum and quadruple its share in total retail trade to 16 percent by 2011-12.

This represents a positive sum game in which both unorganizedand organized retail not only coexist but also grow substantially insize.

The majority of unorganized retailers surveyed in this study,indicated their preference to continue in the business and competerather than exit.

Organized Retailing Involves:

Understanding the needs of the customer.

Developing good assortment of merchandise.

Displaying the merchandise in an effective manner so thatconsumers find it easy and attractive to buy.

Retailerscompromise of

street vendors,

local kirana stores,

supermarkets,

food joints,


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saloons,

airlines,

automobile showrooms,

video kiosks,

direct marketers,

vending machine operators, etc.

Traditionally, Indians were used to buying their sugar, wheat, pulses,rice etc. from their neighborhood baniya. The majority of food and foodproducts were and still are retailed through neighborhood kirana (baniya)stores. The origins of retailing in India can be traced back to the emergence

of Kirana stores and mom-and-pop stores. These stores used to cater tothe local people. Eventually the government supported the rural retail andmany indigenous franchise stores came up with the help of Khadi & VillageIndustries Commission. The economy began to open up in the 1980sresulting in the change of retailing. The first few companies to come up withretail chains were in textile sector, for example, Bombay Dyeing, SKumar's, Raymonds, etc. Later Titan launched retail showrooms in theorganized retail sector. With the passage of time new entrants moved onfrom manufacturing to pure retailing.

The majority of fresh produce is sold from the carts of travelingvendors. Such produce is deemed to be of low product quality, variety andhygiene. This concept is still popular in B-class and II Tier cities of Indiaand giving employment to thousands of its inhabitants.

Initially the food retail format was seen in A-class cities like Mumbai,Delhi, Chennai which had co-operative stores like "Apna Bazaar" inMumbai and "Kendriya Bhandar" in Delhi. Both were very successful andare operating many outlets in all strategic localities in the city. Escorts

group in the late eighties diversified into non-auto sectors by getting intoagri business or food business. It came out with first "Nanz" store at SouthExtension in Delhi in 1990.

Until the late 1990s, food retailing has been a typical kirana store hasa retail area of 200 sq ft and sells 500 to 800 stock keeping units (SKUs).


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The kirana stores focus on dry food products because the infrastructure forcold storage was lacking. Southern India has been witnessingrevolutionized activity in food retailing. It has thoroughly experienced thefood retailing in various formats such as the supermarkets, hypermarketsand neighbourhood stores. These include Food World, Subhiksha, Nilgiris,Margin Free, and Big Bazaar. The reason being that most entrepreneurswho started organised retail came from southern India and the cost of realestate in the southern region was less than other regions (particularlynorth and west). Since then, however, organised food retailing hasemerged across the country, inspired by the presence of high potentialmarkets in the north, west and east as well as the success of some non-food retailers and food services companies in these regions.

Retail outlets such as Foodworld in FMCG, Planet M and Music worldin Music, Crossword in books entered the market before 1995. Shoppingmalls emerged in the urban areas giving a world-class experience to thecustomers. Eventually hypermarkets and supermarkets emerged. Theevolution of the sector includes the continuous improvement in the supplychain management, distribution channels, technology, back-endoperations, etc. this would finally lead to more of consolidation, mergersand acquisitions and huge investments.

The small local stores have dominated Indian retailing over thedecades and are present in every village and local community, addressingthe needs of the population in the area and being the point of contact withthe consumer. The distribution networks of brands extend right upto thispoint to stay in touch with customer needs and preferences.

India like most other countries has a very large network of local stores.The retail industry in rural India has typically two forms: "Haats" and"Melas". You will find these in almost every village and locality. A lot ofthem function as paan and cigarette outlets with tea and coffee sometimes

also offered. Besides this these stores stock and offer small eats and softdrinks including biscuits, soft drinks, chocolate, sweets, bread and bakedproducts. Many of them also sell fruits like bananas and a range of toiletriesand cosmetics like soaps, shampoos, toothpastes and some creams.These small stores cater to the needs of their own local population andtravelers who stop by for a smoke or a snack.


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Fruits and vegetables that are perishable are usually maintained andoffered by exclusive vegetable stores and not by the normal groceries.Every fair sized village is likely to have at least one grocery store, a fruitand vegetable shop and a paan and cigarette shop.

This network is very large and spread all across India. It is not really anetwork since each store is individual or family owned and has noconnection with the other. It does however represent a network since largeconsumer product companies like Unilever, Procter & Gamble, Colgate-Palmolive, Cadbury, Coca Cola, Pepsi and ITC uses them as their finalpoint of retail to the consumer.

While it is commonly believed that the new retail chains will drive thesesmall stores out of business, reality points the other way and it is likely thatthese stores will continue even in the next two decades.

These small stores are very personal and have strong relationshipswith the local population. They are points of news and connection.They offer credit to the local population and help out in times ofcrisis. They also have a very good understanding of requirements of thelocal population and have very low overheads enabling them to offer the

best price for their products.

Looking Ahead

Many strong regional and national players emerging across formats andproduct categories Most of these players are now geared to expand farmore rapidly than the initial years of starting up Most have regained /improved profitability after going through their respective learningcurves.

The Indian Retail growth can be attributed to the several factors including

1. Demography Dynamics: Approximately 60 per cent of Indianpopulation below 30 years of age.


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2. Double Incomes: Increasing instances of Double Incomes in mostfamilies coupled with the rise in spending power.

3. Plastic Revolution: Increasing use of credit cards for categoriesrelating to Apparel, Consumer Durable Goods, Food and Grocery etc.

4. Urbanization: increased urbanization has led to higher customerdensity areas thus enabling retailers to use lesser number of stores totarget the same number of customers. Aggregation of demand thatoccurs due to urbanization helps a retailer in reaping the economiesof scale.

Investment Opportunities

Potential for Investment: The total estimated Investment Opportunity inthe retail sector is around US$ 5-6 Billion in the Next five years.

Location: with modern retail formats having made their foray into the topcities namely Hyderabad, Coimbatore, Ahmedabad, Mumbai, Pune,Chennai, Bangalore, Delhi, Nagpur there exists tremendous potential in twotier towns over the next 5 years

UP-AND-COMING FOOD RETAIL FORMATS

With the changing food consumption patterns, consumers need for

convenience, choice and value for money the set-up of retail format is

changing. The Indian consumers do visit about eight to ten outlets to

purchase various food products, which make up the daily consumption

basket. These outlets include neighbourhood kirana stores, bakeries, fruit

and vegetable outlets, dairy booths and chakkies (small flour mills), which

is very time-consuming and unproductive way of shopping for food. With

changing lifestyle there is growing scarcity of time, and convenience in foodshopping is emerging as an important driver of growth of one-stop retail

formats that can offer consumer 'value for time' in addition to 'value for

money'. These are giving an opportunity to various other retail formats:


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A. Neighborhood Stores

In India about 90% of food purchases are made within a distance of 1.5 km

from the customer's home. This means that an organised retailer wouldneed to have a 'neighbourhood store' close to customers in order tocapture the share of wallet that is spent on food. These stores would caterto the consumer's daily and weekly needs. The outlets closest to aneighbourhood store in India are 'Safal' outlets operated by Mother Dairy inDelhi, Margin Free in Kerala and Subhiksha.

B. Supermarkets

This format caters to the consumers' need for choice and variety. Theseneeds translate into 'more width' and 'more depth' in each category. Thesestores cater to the consumers in a catchment area with a radius of 3 to 4km and therefore need to be destination stores. A supermarket can cater tothe consumers' weekly, monthly and occasional needs. Examples ofsupermarkets already in India are Food World, Trinetra and Nilgiri's.

C. Hypermarkets

Hypermarkets are essentially destination stores catering to the consumers'

bulk shopping needs in both food and non-food categories. The key addedvalues for the customer are 'choice' and 'value for money' becauseproducts are sold at a discounted price. The hypermarkets model of foodretailing is new to India. Spencers (RPG), Big Bazaar (Pantaloons), StarIndia Bazaar.

D. Cash & Carry (C & C) Stores

These stores sell their products to their members only. The members aretypically retailers and institutions. The key added value is a wide range of

products under one roof, available at wholesale prices. Metro has startedthe first C & C store in India in Bangalore. The typical area of a C & C storeis 70,000 to 100,000 sq. ft. and both food and non-food products arestocked.


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KEY DEVELOPMENTS IN RETAIL

The major development in food retail is consideration of Foreign Direct

Investment (FDI) with a limitation that all companies would have to meetmandated export obligations. Food processing minister Subodh KantSahay told ET that We are considering a proposal to allow FDI in foodretail. It should be in such a way that it would boost our agriculture. Ourfarmers must also get benefits of economic liberalization.

The government is also considering the opening up of the $330-billionretail market with adequate provisions to protect neighborhood stores.

In every retail format food trade is growing. More and more corporatehouses such as HLL, ITC, Godrej and Reliance are already working intofood retail. Huge increase is expected from the corporate players, whichwill help grow the entire food retail sector. Daburs Amit Burman has alsoforayed into food retailing. According to Amit "Food and beveragesretailing is a very attractive segment and with Lite Bite Concepts we aretargeting Rs 1,000 crore sales in a couple of years with around 200outlets," Well-established players such as Subhiksha, Food Bazaar andSpencer's Daily are also tapping into backward linkages, while trying tomatch their expanding geographies with retail formats. Also, most food

retail players have been region-specific as far as geographical presence isconcerned. Take the RPG Group's FoodWorld, Nilgiris, Margin Free, Giant,Varkey's, all of which are more or less spread in the Southern region;Sabka Bazaar, Big Apple has a presence only in and around Delhi; namessuch as Haiko and Radhakrishna Foodland are Mumbai-centric; whileAdani is Ahmedabad-centric.

Retailers' entrance in the unbranded food space

Modern food formats like Food Bazaar and Spencer's have their eye

on the unbranded part of the consumer's shopping basket. This constitutesas much as 60% of the total purchases and growing sharply, says ACNielsen estimates. Retailers are offering a package of convenience andfreshness, and have an edge over manufacturers that focus mainly onpackaged conveniences.


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Food retailers are offering 'live kitchen' formats, which offer on-the-spot home-style gravies, dal, cooked rice and kneaded dough with optionslike grinding coffee fresh at store, idli batter, paneer, curd and cutvegetables.

FOOD RETAIL AND ITS STEPPING STONES

Rising Investment

There are strong opportunities in food retail as a result ofencouraging changes in consumer purchasing patterns, the availability ofreal estate and supply chain development. Organized food retail presents aunique investment opportunity for corporates looking to diversify. A goodunderstanding of consumer, access to the right locations and the ability to

manage the supply chain efficiently will be critical success factors for thenew entrant.

FDI Policy for Retail

Gates have been opened up for single brand retailers. In February2006, the door was opened to some extent when the government allowed51% FDI by single brand companies subject to government approvals.

Emergence of Logistic Providers

The present lack of logistic support exposes the need for anintegrated logistic provider. As retail activity gathers momentum and largequantities of perishables are sold in modern formats, the logistic serviceproviders would have a crucial role to play in bridging the supply gap. Retailplayers would also benefit from an efficient supply chain inventorymanagement.

INDIA RETAIL BY 2011-12

50 million sq. ft. of quality space under development.

7 major cities to account for 41 million sq ft development.

300 malls, shopping centers and multiplexes under construction.


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To open 35 hypermarkets.

325 large department stores.

1500 supermarkets and

Over 10,000 new outlets.

To add US $10 billion of business to organized retail.

Briefing on the report Mr. R S Roy, Editorial Director, IMAGES Group said

that the presentation of India Retail Report 2009 required a yearlong

interaction with over 1000 companies representing the entire gamut of

manufacturing, retailing and the services sector that had direct or indirect

impact on consumer spending. The study required a thorough

understanding of the world market, major players, strategies and emerging

trends and the evolution of Indian retail across multiple segments.

"Supported with the findings of various research reports of IMAGES and

KSA Consumer Outlook study the India Retail Report 2005 presents size,

strengths and scope with performance of key players in each segment and

explores new emerging segments that have potential for new and existing

players,"

Major Formats of In-Store Retailing

Branded StoresExclusive showrooms either owned or franchised out by amanufacturer. Complete range available for a given brand, certifiedproduct quality.

Specialty StoresFocus on a specific consumer need; carry most of the brandsavailable. Greater choice to the consumer, comparison betweenbrands is possible.

Department StoresLarge stores having a wide variety of products, organized intodifferent departments such as clothing, house wares, furniture,appliances, toys, etc. One stop shop catering to varied/ consumer


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needs.

SupermarketsExtremely large self-service retail outletsOne stop shop catering to varied consumer needs

Discount StoresStores offering discounts on the retail price through selling highvolumes and reaping economies of scale, Low Prices

Hyper- martLarger than a supermarket, sometimes with a warehouseappearance, generally located in quieter parts of the cityLow prices, vast choice available including services such as

cafeterias.

Convenience storesSmall self-service formats located in crowded urban areas.Convenient location and extended operating hours.

Shopping MallsAn enclosure having different formats of in-store retailers, all underone roof. Variety of shops available.

Formats Adopted by Key Players in India

1) Retailer2) Original formats3) Later Formats

RPG RetailSupermarket (Foodworld)Hypermarket (Spencer's)Specialty Store (Health and Glow)

Piramal'sDepartment Store (Piramyd Megastore)Discount Store (TruMart)

Pantaloon Retail


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Small format outlets (Shoppe)Department Store (Pantaloon)Supermarket (Food Bazaar)Hypermarket (Big Bazaar) Mall (Central)

K Raheja GroupDepartment Store (shopper's stop)Specialty Store (Crossword)SupermarketHypermarket

Tata/ TrentDepartment Store (Westside)Hypermarket (Star India Bazaar)

Landmark GroupDepartment Store (Lifestyle)Hypermarket

OthersDiscount Store (Subhiksha, Margin Free, Apna Bazaar), Supermarket(Nilgiri's), Specialty Electronics

Road Ahead- Plans of Large Retailers

Reliance Retail: investing Rs. 30,000 crore ($6.67 billion) in setting upmultiple retail formats with expected sales of Rs. 90,000 crore plus ($20billion) by 2009-10.

Pantaloon Retail: It Will occupy 10 mn sq. ft retail space and achieveRs.9,000 crore-plus ($2 bn) sales by 2008.

RPG: Planning IPO will have 450-plus Music World, 50-plus Spencer's

Hyper covering 4 mn sq. ft by 2010.

LIFESTYLE: Investing Rs.400 crore-plus ($90 mn) in next five years onMax Hypermarkets & value retail stores, home and lifestyle centres.


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Raheja's: Operates Shoppers' Stop, Crossword, Inorbit Mall, and 'HomeStop' formats. Will operate 55 "Hypercity" hypermarkets with US$100million sales across India by 2015.

Piramyd Retail: Aiming to occupy 1.75 million sq.ft retail space through150 stores in next five years.

TATA (Trent Ltd.): Trent to open 27 more stores across its retail formatsadding 1 mn sq.ft of space in the next 12 DLF malls. Titan industries to add50-plus Titan and Tanishq stores in 2006.

INDIAN PLAYERS

1- Pantaloon retail India limited (PRIL)

Renamed itself as "FUTURE RETAIL'' in march 2006, as part of itsrestructuring and expansion plans. Headed by Kishore Biyani includepantaloons. Big bazaar, food bazaar, gold bazaar and the central mall.

The first menswear pantaloons outlet was set up in 1992. Thecompany sold products under the bare denim, springboard, Lombard andJohn miller brand names. Pantaloons offered a wide range of clothing

options to Indian consumers. It stocked garments, accessories and lifestyle products.

The target audience for pantaloons was upper and middle classurban population in India. Customer feedback and customer satisfactionwere the key focus at PRIL.


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Company relied heavily on IT for collecting customer data andopinions .PRIL realized the potential of huge middle class population inIndia, apart from retailing lifestyle products, it ventured in to BIG BAZAAR-in 2001 PRIL opened its first big bazaar, which had an area of 30,000 sq ft.in Kolkata .the major USP of the big bazaar store was low prices and thebest price proposition being offered to customers.

The caption used in the promotionis se sasta aur accha kahinnahin (cheaper and better than this? nowhere else!) indicating value formoney stores. Big bazaar stocks over 2,00,000 products that includeapparel, food products, home appliances, and cosmetics. Product arecheaper than the the market price by as much as 5-60 %, apparel arecheaper by 25-60%.


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The success of PRIL comes from cheaper sourcing of products andlower distribution costs. In addition to big bazaar, PRIL also started 'FOODBAZAAR' in 2001. The first food bazaar store was set up in the lower parelregion of Mumbai. Food represented PRIL's foray in to yet another valueretailing business, which focused on food and grocery products.

The stores were designed based on PRIL's understanding of thedomestic needs of Indian housewives. The caption used in the promotioncampaign of food bazaar wasab ghar chalaana kitna Aasaan ( now, it isso easy to run a house ). It had over 50,000 stock keeping units thatcovered a range of products like cereals, pulses, sugar, rice, juices, milkproducts and FMCG products, besides stocking vegetables and fruits. Mostproducts were sold at Discounts ranging between 2- 20 %. Due to itsfocused Marketing and merchandising strategies, the food bazaar stores

soon became popular among customers.

PRILs central malls are targeted towards the up-market segment ofurban population. In 2005 PRIL had three central malls located atHyderabad, Bangalore & Pune. Each central mall has different departmentsfor home Products, fashion, leisure, food, health, restaurant, beautyparlors, a pub and a nightclub.

PRIL also ventured in to online retailing by launching its e-retailportal, futurebazaar.com, in may 2006 .with the launch of this onlineshopping portal, PRIL planned to invest Rs 150mn and hoped to earn Rs 3bn from the venture. To counter competition from leading e-commerceportals in India like e Bay, Rediff, Fabmall and Indiatimes.

2- RPG Group-

The Ramah Prasad Goenka group one of the entrants in to theorganized retail sector in India . They launched the 'FOOD WORLD' chainof grocery stores in 1999. By 2005, there were more than 90 Food world

stores across India, making it the largest food & grocery retail chain. Foodworld has been growing at an annual growth rate of 30 % over last 5 years.Food world stocks almost 5000 items. In each outlet. Suppliers can deliverproducts directly to warehouse, from warehouse the products than bedistributed to individual food world. This shortens the distribution channel,resulting saving and saving passed on to the customer, providing quality


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goods at lower costs.

RPG too used IT for running operation smoothly and also hi- techCash registers and bar code scanners.

RPG also owns spencer's hyper market a chain of retail hyper market inIndia. Spencer's hypermarket stock a wide range of products right fromgroceries, food items, home needs, fresh food, garments and consumerdurables.

Spencers Retail is one of Indias fastest growing retail stores with multipleformats and retailing food, apparel, fashion, electronics, lifestyle products,music and books. Established in 1996, Spencers has become a populardestination for shoppers in India with supermarkets, hypermarkets and

dailies spread all over India.

Operations

Spencers has retail footage of over 2 million square feet and over 400Spencers storesin65cities.

The company operates through the following formats:

Spencers Hypermarkets: A fast growing retail network of hypermarketswith large format stores in Mumbai, Gurgaon, Ghaziabad, Lucknow,Calicut, Hyderabad, Vizag, Vijayawada, Aurangabad Durgapur andKolkata.

Spencers Super: one of the largest supermarket chains in the food andgrocery segment in India.

Spencers Daily: small format stores conveniently located with a range

of products to meet your daily household needs.Spencers Express : your food and grocery store next


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RPG Enterprises, established in 1979, is one of Indias fastest growingbusiness groups with a turnover touching USD $3.25 billion. The group hasmore than twenty companies managing diverse business interests in theareas of Power, Transmission, IT, Speciality, Carbon Black, Tyre,Retail and Entertainment.

Wide-ranging businesses, growing returns and a reputation to reckon,makes working with RPG an enriching experience. Where entrepreneurialskills are valued, excellence is the by-word, and performance is a pre-

requisite.

ManagementThe RPG Management Board is the backbone of the conglomerate. Itsmembers are highly qualified professionals, well experienced in theirrespective fields.

ValuesRPGs business ethics promote higher levels of excellence. The groupsvalues of Customer Sovereignty, People Orientation, Innovation &

Entrepreneurship, Transparency & Integrity, Passion for SuperiorPerformance, Anticipation, Speed and Flexibility propel it to perform andexcel in all spheres of the business.

QualityFor RPG quality determines success. Continuous process improvements


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are carried out to ensure complete satisfaction of customer and marketrequirements.

Beyond Business

RPG is a socially responsible organization; believing in giving back to thecommunity what it has gained from it. The group regularly contributestoward the welfare of various social groups and is involved in promotingsocial activities in the field of sports and arts.

MUSIC WORLD- launched in 1997 is another RPG retail venture, largestmusic retail chain in India with over 170 outlets. It stocks music videos,audios, accessories etc. the store ambience and presentation of productshave contributed strongly to music world's success.

'Health & Glow'- joint venture between RPG & Dairy farm international.Launched in 1997- it is the first retail chain catering exclusively to thehealth and beauty requirement .the health & glow outlets offer cosmeticand medicinal products and services, all under one roof.

3- Tata Group

The group started its Retail Business in 1998 with the purchase of the littlewoods Retail stores, originally owned by a UK based firm.

The company was renamed Trent limited and the littlewoods storewas called westside. As of 2005, there were 16 westside stores acrossIndia about 20,000 sq ft in size. The Westside outlets are in apparel storesa cross India about 20.000 sq .ft in size.


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The Westside out lets are in appored and accessories retailing andoffer international shopping experience with value for Money. Offer qualityproducts with latest designs. Each Westside store has two divisions, oneapparel division and other product division. These divisions are furtherclassified in to seven departments (catering to men, women, kid's wear andneeds)

Star India Bazaar:

A hypermarket with a large assortment of products at the lowest prices.Started in 2004, these outlets offers a wide choice of staple food,beverages, health and beauty products, vegetables, fruits, dairy products,consumer electronics and household items. Presently there is only one50,000 square feet store in Ahmedabad and plans to extend its presence

across all major metros.

Landmark:In 2005, Tatas acquired 76per cent stake in Landmark, India'slargest book and music retailer. At present Landmark has 7 stores, varyingin size from 12,000 sq. ft. to 45,000 sq. ft, 3 in Chennai and 1 each inBangalore, Gurgaon, Mumbai and Vadodara. Landmarks product profileincludes books, stationery, greeting cards, music CDs, toys and other giftitems.

Infiniti Retail / Croma: Deals with consumer electronics and durable

products under the retail outlet brand name Croma. The company would beinvesting upto Rs 4 billion for this venture. Croma is set to expand all overthe country with at least 100 stores by 2011. With the backing of technicaland sourcing collaboration with Australias retail major Woolsworths, Cromaoffer products in home entertainment, appliances, white goods, computers,software,communication, music and gaming from leading brands such asApple, Godrej, LG, Kenstar, Canon, Sony.

Titan industries established in 1984- it is India's leading watchmanufacturer and retailer. Titan market its range of watches under the'Titan' and 'sonata' brands and hold a 25% market share in watch industry .Titan's series of watches included Fastrack, Edge, Nebula, Raga, Sonata,Regalia, Bandan and Steel. Sonata was targeted at middle classconsumer, who is both price conscious and quality conscious. Competitorsof Titan are HMT and TIMEX.


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Titan entered in to jewelry segment under the brand name 'Tanishq' in1995. Tanishq jewelry is sold exclusively by 69 outlets spread over 53Indian cities and also exported to US, Europe, Australia, and Middle East.

4-K.Raheja Corp. Group of Companies-

India's largest real estate players. They launched Shopper's Stop in 1991 &its outlets stock apparel, accessories, household items, perfumes andcosmetics, coffee shops and book stores to give consumers a completeshopping experience.

Crossword Bookstores Ltd- a subsidiary of Shopper's Stop in book retailingbusiness has 22 stores across India.

5-RRL (Reliance Retail Limited)-

On june 26, 2006, mukesh Ambani, C & MD, Reliance industries limited,announced his plans to foray in to the retail sector with an initial investmentof US$ 5.6 bn. RRL was expected to have its presence across Indiawithdifferent retailing formats such as warehouse clubs, hypermarkets,supermarkets, specialty stores and convenience storess . Reliance alsohad plans to open restaurant outlets within its stores.

In Nov 2006, RIL launched its first retail store 'RELIANCE FRESH' at

Hyderabad. The store catered to consumer needs by providing fresh fruits,vegetables, groceries and dairy products.

6- A.B.Birla Group- which has acquired supermarket chain TRINETHRAhas ruled out partnering foreign firms in its bid to be among the country'stop retailers.

7- Gati- a cargo management and logistics solutions provider, on Jan 07launched its foray in to the retail sector, opening the first of its retail store,'Cafe d'eliver' in Hyderabad on 6 Jan 07. Gati has targeted the opening of

100 'Cafe d'eliver' by march 2008 to offer various services like fax,document photocopying, calling and printing, internet browsing in additionto own cargo services.

8- SUBHIKSHA- is a chain of food and pharmacy discount retail stores. It isbased in Chennai and has a strong presence in southern India.


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9- MARGIN FREE- is a Kerala based chain of discount stores.

10- CALVIN KLEIN, MURJANI GROUP-

Calvin Klein Inc., the clothing design and marketing studio formed in 1968,

is to set up a retail operation in India. The clothing empire and Murjani IndiaLtd. have announced an agreement for the latter to market and distributethe brand's various labels throughout India and open dozens of retail storesplanned for the subcontinent.

The agreement authorises Murjani to market the Calvin Klein lineupthrough exclusive retail outlets and select department stores approved bythe company. It includes the original Calvin Klein Jeans line and the unisexck Calvin Klein label, which the company introduced in the mid-1990s.

Murjani India, a subsidiary of the Murjani Group, focuses on attractinginternational brands and retail concepts to India. Murjani forged a separatedeal with The Warnaco Group, a New York-based apparel company,granting Warnaco exclusive rights to distribute the Calvin Klein Underwearline of products in India and supply Calvin Klein Jeans to Murjani.

The broad plan is to open at least 40 Calvin Klein-branded stores duringthe first five years of the operation, with construction beginning as early asMarch 2007.

11- DISNEY ARTIST STORES-

The Ravi Jaipuria held company RJ Corp has signed an exclusive masterfranchise agreement with Disney Consumer Products to source and marketDisney character branded cards, stationery, arts, crafts and party productsthrough exclusive Disney Artist stores in India . The first of the stores is toopen in Mumbai in January 2007.

Under the Disney Artist brand in India, RJ Corp will sell as vast range of

Disney character-led products aimed at the kids and youth categoryTheRavi Jaipuria held company RJ Corp has signed an exclusive masterfranchise agreement with Disney Consumer Products to source and marketDisney character branded cards, stationery, arts, crafts and party productsthrough exclusive Disney Artist stores in India . The first of the stores is toopen in Mumbai in January 2007.


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Under the Disney Artist brand in India, RJ Corp will sell as vast range ofDisney character-led products aimed at the kids and youth category

12 -Vishal Group - launched their first hyper market Vishal Mega mart inUdaipur this month. Spread over 25,000 sq.ft, the store offers extensiverange of men's, women's and kids' range of fashion clothing. Besidefashion attire, it will also have separate sections and counters for watches,sunglasses, fashion accessories, gifts and novelties, electrical appliances,digital diaries, perfumes, cosmetics and grocery items etc. Currently, VishalMega Mart operates 29 fully integrated and self-owned stores spread overa total shopping area of 5,70,000 sq.ft in 21 cities across India.

SUBHIKHSHA

Subhikshas taking on the kiranas and targeting the Rs 2,000-3,000 thathouseholds spend every month on food and toiletries. Hes also clear thatthe chain does not intend to target the more affluent households.Ouroutlets are not destination stores like those located in malls, he says. Theshops are not air-conditioned and about 1,500- 2,000 square feet in size.Most do not allow consumers to walk around and browse; consumers haveto walk down a single aisle and in many shops, cant turn back.Subhikhshas value proposition: provisions that are a good 10 per centcheaper than those available at the kiranas. And home delivery to boot.Thats going to be the long term differentiator. Says Khattar, We offer thelowest prices across products, not just on 50 or 100 items and werecheaper than supermarkets or kiranas. Our customers should easily beable to save around Rs 700-800 every month on a bill of Rs 4,000.

What Subhikhsha believes will work for it are the attractive prices that areavailable throughout and not just on some days of the week. It hopes toattract a large portion of the total food and grocery spends, which areestimated to be as much as 40 per cent of total spends. Some of the stores

also stock medicines and telecom products. Gibson Vedamani, chiefoperating officer, Retailers Association of India, likes the strategy. Says he,They have positioned themselves on the value-for-money platform whichis a strong property and will help them attract consumers quickly.

To be able to sell to customers at attractive prices, Subhikhsha needs to


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build scale quickly. Today, the company has a total floor space of 1.3million square feet; by the end of 2008-09, it hopes to be able to increasethis by at least two and half times to around 3.25 million square feet.Industry experts point out that since the company is not banking onexperience shopping and relies on its low-cost advantage ,it has to scaleup before hypermarkets enter the game as they will offer consumers boththe experience and good prices.

Says Harminder Sahni, principal associate, KSA Technopak, Subhikshalargely caters to a segment driven by price. Hypermarkets could becheaper and Subhiksha will be squeezed between the experience storesand the hyper markets. Vedmani agrees. When hypermarkets enter theywill pose a huge threat. But if the company can scale up quickly, it will beable compete with the new entrants, he observes.

As of now though, Subhikshas stores are doing brisk business. In fact, thedemand, says Khattar, has been overwhelming and there have been timeswhen stores have run out of stocks.Hes busy making sure that theshopshelves are full. That should make sure the stores too are full.

FOREINGN PLAYERS IN RETALING

1- Wal-Mart Stores Inc- is the largest retailer in the world and is based inBentonville, Arkansas, USA. For the year ended Jinuary 2006, Wal-Mart

had revenues of US$ 315.65 bn and a net income of US$ 11.23 bn

(source: finance.google.com).it tied up with Bharti mittal group to launced

its product in India. It is also the largest employment provider in USA.

2- CARREFOUR SA - is a French retail group that operates networks of

hypermarkets, supermarkets, discount store, convenience stores and cash-

and carry outlets. for the year ended december 2005, Carrefour hadrevenues of 74.49 a net income of 1.58 bn (source: finance.google.com)

3- TESCO Plc- is the largest retailer in UK. For the year ended February

2006, the group's sales were 57.93 bn and a net income of 2.31 bn

(source: www.hoovers.com)


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4- Rosy Blue Group - the world's largest Diamond manufacturer is

planning to invest Rs.900mn in setting up 40 exclusive ORRA Diamond

Jewelry showrooms in India.

5- LVMH Group - Dior, the well known watch brand from the Louis VuittonMoet Hennessy (LVMH) Group is planning to include India among its top

12 world markets, most global players were opting for the franchisee route.

However, despite the restriction on FDI, Foreign retailers had other modes

of entry in to the Indian retail market. This included franchising, strategic

alliances and the wholesale trading. It was reported that Tesco had plans to

enter the Indian retail market through a joint venture through Homecare

Retail Mart Pvt.Ltd. for opening 50 stores by 2010.

STAGE: 3 DATA EVALUATION

Organized vs. Unorganized Retail

In the developed economies, organized retail is in the range of 75-80 percent of total retail, whereas in developing economies, the unorganizedsector dominates the retail business.


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The share of organized retail varies widely from just one per cent inPakistan and 4 per cent in India to 36 per cent in Brazil and 55 per centin Malaysia Modern retail formats, such as hypermarkets, superstores,supermarkets, discount and convenience stores are widely present in

the developed world, whereas such forms of retail outlets have only justbegun to spread to developing countries in recent years.

In developing countries, the retailing business continues to bedominated by family-run neighborhood shops and open markets. As aconsequence, wholesalers and distributors who carry products fromindustrial suppliers and agricultural producers to the independent family-owned shops and open markets remain a critical part of the supply chainin these countries. The real GDP is expected to grow at 8-10 per centper annum in the next five years.

As a result, the consuming class with annual household incomes aboveRs. 90,000 is expected to rise from about 370 million in 2006-07 to 620million in 2011-12. Consequently, the retail business in India isestimated to grow at 13 per cent annually from US$ 322 billion in 2006-07 to US$ 590 billion in 2011-12.

The study shows: The unorganized retail sector is expected to growat about 10 per cent per annum with sales rising from US$ 309 billionin 2006-07 to US$ 496 billion in 2011-12.Given the relatively weak

financial state of unorganized retailers, and the physical space

constraints on their expansion prospects, this sector alone will not beable to meet the growing demand for retail. Hence, organized retail


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which now constitutes a small four per cent of total retail sector islikely to grow at a much faster pace of 45-50 per cent per annum andquadruple its share in total retail trade to16 per cent by 2011-12.Thisrepresents a positive sum game in which both unorganized andorganized retail not only coexist but also grow substantially in size.The majority of unorganized retailers surveyed in this study, indicatedtheir preference to continue in the business and compete rather thanexit.

Global retail sales are estimated to cross US$12 trillion in 2007.1 Almostreflecting the growth in the world economy, global retail sales grewstrongly in the last five years (2001-06) at an average nominal growth ofabout 8 per cent per annum in dollar terms. This is in contrast to nearstagnant global retail sales during the previous five years, 1996-01.

Grocery dominates retail sales with a share of approximately 40 per centwhich varies from about 30 per cent in rich Japan to an average of 60per cent in poor Africa.

Retail sales through modern formats have been rising faster than totalretail sales; the share of modern retail has risen from about 45 per cent


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in 1996 to over 52 per cent in 2006.Organized retailers are thecontemporary formats by which shoppers have the edge of a world classshopping experience. Fine examples of these formats are Pantaloon,Shoppers Stop and Trent.

Source: Planet Retail and Technopak Advisers Pvt. Ltd.

Indias growing no. of Domestic Groceries Chain and early foreignentrants.

Five Reasons why Indian Organized Retail is at the brink of Revolution:

1. Scalable and Profitable Retail Models are well established for most ofthe categories

2. Rapid Evolution of New-age Young Indian Consumers3. Retail Space is no more a constraint for growth

4. Partnering among Brands, retailers, franchisees, investors and malls5. India is on the radar of Global Retailers Suppliers


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There are various factors paving the way to revolutionizing food retailing inIndia. Among them few are:

Changing life styles and tastes Growing need for convenience Increasing disposable income Increasing numbers of working women Change in consumption patterns Higher aspirations among youth Impact of western lifestyle Plastic Revolution Increased use of credit cards and debit cards

Organized retail may broadly be classified into the following formats

Malls Hypermarket MBOs:-Multi Brand outlets, also known as Category Killers, offer

several brands across a single product category. These usually dowell in busy market places and Metros.

Supermarket Discount stores Convenience store Departmental store Exclusive store Specialty store


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ORGANIZED RETAIL EXPANSION BY FORMAT

Format

Average

Size (sq.

ft.)

2001 2006

No.

of

Stores

Area

('000

sq.

ft.)

Share

in

Total

Space

(%)

No.

of

Stores

Area

('000

sq. ft.)

Share

in

Total

Space

(%)

Supermarkets /

convenience

stores

1,000 400 400 11.9 4,751 4,751 15.5

Hypermarkets 40,000 0 0 0.0 75 3000 9.8

Discount stores 1,000 48 48 1.4 1,472 1,472 4.8

Speciality stores 800 2,651 2,121 63.3 20,612 16,490 53.7

Department

stores

30,000 26 780 23.3 166 4,980 16.2

Total 3,125 3,349 100.0 27,076 30,693 100.0


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REVIEW OF RELEVANT THEORITICAL CONCEPTS

This section consists of the various concepts and business practices thathave affected the project. Here we would be reviewing the various researchand analysis concepts that have been widely and prudently used forgathering vital information from customers and competitors. Concepts thathave enabled us do a sound analysis from the facts assimilated are alsodiscussed here.

What is Marketing Research?

The American Marketing Association defines marketing research asfollows:

Marketing Research is a function which links the consumer, customer andthe public to the marketer through information information used to identifyand define marketing opportunities and problems; generate, refine andevaluate marketing actions; monitor marketing performance; and improveunderstanding of marketing as a process.

Marketing Research specifies the information required to address theseissues; designs the method for collecting information; manages andimplements the data collection process; analyses the results; and

communicates the findings and their implications.

Marketing Research Process

The marketing research process consists of the following six steps:

1. Specifying research objectives.In this step questions like What is the purpose of the project ? and Whatare the objectives of the project ? need to be carefully addressed andsincerely answered.

2. Preparing a list of needed information.Here after a satisfactory statement of the studys purpose and objectiveshas been established, it is necessary to prepare a list of the informationneeded to attain the objectives.


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3. Designing the data collection project.Here the researcher determines whether such information is alreadyavailable, either in company records or with outside sources. He shouldcollect data from field after duly reviewing secondary data available. If therequired information is unavailable, the researcher will have to collectinformation from the field for which he needs to design a data collectionproject.

This includes answering questions like should research be conclusive orexploratory?, who should be interviewed? and how should the datacollection form be designed?.

4. Selecting a sample type.As collecting information from a large population is difficult andcumbersome, a sample is selected and information collected. We may

select either a probability sample or a non probability sample.

5. Determining the sample size.This step decides about the size of the sample that can vary from fewerthan 10 to more than 1000. The sample size depends on the accuracyneeded, the budget available and time constraints if they apply.

6. Organizing and carrying out the fieldwork.Fieldwork includes selecting, training, controlling and evaluating themembers of the field force. A large number of errors are could arise at this

stage due to the large number of people involved. Timely spot checks andreviews should be carried out to ensure accuracy and genuineness ofresponses.

7. Analyzing the collected data and reporting the findings.After all interviews and observations are made, the completed datacollection forms should be processed in a way that yields fruitful results.Data needs to be tabulated and analyzed appropriately. While preparingreports, it should be ensured that the researchers suggestions andrecommendations are included in the executive summary.


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RRREEESSSEEEAAARRRCCCHHH MMMEEETTTHHHOOODDDOOOLLLOOOGGGYYY

RESEARCH TYPE : Random samplingRESEARCH INSTRUMENT: QuestionnaireSAMPLING UNITS : IndividualSAMPLING SIZE : 50

SAMPLING METHOD : Questionnaire and personal Interviewmethod for conducting surveys intending to gather primary data.

INFORMATION SOURCES:

1. Primary Data-

Questionnaires

Interviews of existing small domestic establishments.

2. Secondary Data-

Internet

Books

Articles

Literature

DATABASE

In this thesis, I had to do research to study a comparative analysis tofind out the impact of organized retail stores on the small domestic

establishments in Vadodara city. I completed the research activity byconducting survey.

Target population: existing small domestic establishments of Vadodara.


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Research Design: - DataCollection.The method of data collection isprimary data from existing small domestic establishments.

Mode of communication: Personal interview with the respondent throughstructured direct questionnaire containing list of alternatives.

The Research Type was of Random sampling and the ResearchInstrument is Questionnaire, the Sampling Units is Individual and theSampling Size was 50.

The personal Interviews conducted of existing small domesticestablishments; some of them are as follows:

VIMALESHWAR STORERIDDI SIDDHI STORE

GANDHI STORE

ANKUR STORE

PRATIK STORE

AMUL STORE

KHETESHWAR STORE

SHREE KRISHNA STORE

VIMAL STORE

SUVARNA STORE

BALAJI STORE

SHYAM STORE


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Analysis on small domestic establishments

with special emphasis on food and grocery

I conducted survey of 25 small domestic establishments with special

emphasis on food and grocery.

I came to know that 15 stores are 15 years old, remaining 10 stores

are 5-6 years old.

What kinds ofproduct are offered by you to customers?

Name of products No. of stores

Fruits 10

Groceries 30

milk products 30

Spices 20

Ready to eat food 15

Biscuits 30

cold drinks 25


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No. of customers visit their stores on daily bases.

NO. OF CUSTOMERS NO. OF STORES

less than 50 1650-100 8more than 100 6


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Effect of the following factors in influencing or switching away your

regular customers

good

aesthetic atmosphere

prime

location

friendlystore

person

sellingsupp

gds

discount

offer

high

advertise

big

brand

freehome

delivery5 5 5 0 7 8 6 6 04 4 3 1 2 2 2 2 0

1 1 2 9 1 0 2 2 10

Effect on products of small domestic establishments due to the

organized retail stores

readytocook

Milkproducts vegetables fruits groceries spices

biscuits& con

colddrinks

Not at all 6 5 7 7 6 10 3 3Some what 2 1 2 2 0 0 1 1

Considerable 2 4 1 1 4 0 6 6


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Services or facilities offered to maintain your loyal customers

No. of services are given No. of stores

Credit is given 15

Free home delivery 28

Order taking on telephone 25

Fast delivery 30

Discount 0


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Analysis of small domestic establishments

with special emphasis on apparel

I conducted survey of 25 small domestic establishments with special

emphasis on apparel.

I covered Raopura and Mangalbazar area of Vadodara city.

Do you think any of the following things has happened because oforganized retail stores?

Not atall

Somewhat Considerable

Decrease in total no. of customer base 15 5 5Frequency of purchase of individual customers 15 5 5Demand of more facilities like big businessgroup shopping mall 15 3 7

Decrease in annual turnover 15 4 6


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Factors influencing customers for switching

HighImpact

Somewhat

Noimpact

Good aesthetic 8 2 0Atmosphere 8 2 0prime location 9 1 0Friendly store person 0 3 7selling supplementary ( large variety ) 6 2 2Discount offer 3 1 6

high add 7 2 1big brand name 8 0 2selling other house hold 8 1 1offering latest wear 7 1 2availability of more international brand 5 2 3other recreational factor like parking 6 2 2


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CONCLUSION - FOOD AND GROCERY

During their entry phase when organized retailers came into the market

somewhat they were affected at some level. After sometime the customersstarted to come to their stores.

PRICE : Respondents replied that Reliance fresh is giving one rupeediscount on milk and vegetables which are available at less prize ( 50paisa ) because of their purchase from suppliers in bulk quantity ascompared to small domestic establishment in order to the customers.

If we talk about the products then I can say that Biscuits, cold drinks, milkproducts and groceries are the most affected as the organized retailers are

offering the same services at low cost and also these products have a lowprofit margin.

Nowadays, customers have many options to buy a particular product. So

they buy from those retailers who sell them at least prices.

Literate Employees: In competitive scenario retailers have to maintain

their loyal customers. We believe that big retailers are giving more and

more services like home delivery, providing information of products with

their literate employees who have good communication skills and thusinteract with the customers in a very pleasing manner.

Customers are not satisfied with the issues of exchange of products dueto bad quality, with the small domestic establishment. Because goods oncesold cannot be taken back. This becomes one of major factor going againstthe small domestic establishment. On the other hand, Customers now havetrust on organized retailers as they visit their stores regularly. And in thecase of exchange of products due to bad quality, customers are not worriedbecause organized retailers exchange the goods with a smiling face and

have not kept it time bound, this on the other hand increased customersatisfaction and loyalty.

After learning from small domestic establishment now organized retailersare also providing free home delivery service which was earlier adistinctive service of small domestic establishment.


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The small domestic establishment which are 15-16 years old orwholesalers are not affected by the organized retail stores, because theyhave already build very personal and strong relationship and bonding withtheir customers. The major reason behind it can be the credit services fora month or two provided by them to the customers plays a vital role in theirexistence.

Customers of Small domestic establishments are easily wooed and

influenced by discounts, mass advertisements.

Customers are now also become brand choosy or brand conscious but

Small domestic establishments keep most of their products which are local,

they dont keep international brands as compared to organized retailers .

But, if we talk about overall small retail stores, I can say that they arenot much affected by the organized retail stores, as Small domesticestablishments are providing fair amount of services to theircustomers.

CONCLUSION - apparel


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As per my survey I can say that 15 stores of Raopura are not affected

much by organized retail stores but 10 stores from Mangalbazar and

mandvi are affected.

According to the small domestic establishments retailers of Raopurasay that Raopura is prime location for shopping. On the other hand,

Mangalbazar is not posh location so high middle class people or

young people does not preferred this location to shop, reason being

young people are attracted by malls i.e., organized retail stores.

Small domestic establishments have less variety and less volume of

clothes as compared to organized retail stores. Customers do not get

more choices from Small domestic establishments because of limitedmerchandise.

In the cases of exchange, malls have time limit but small retailers are

flexible enough.

The retailers of Boutique like Trezer says that they have more party

wear or fashionable apparel compare to the malls.

People go to malls by attraction of the discount offer on the FMCG

goods so they go and just see but they dont buy the apparel from

malls. So, I can say that prime location plays major role for the

customers.

But, as per my findings some stores are affected by the

organized retail stores but not all the stores are affected.


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SUGGESTIONS

CREDIT: It is a distinctive and USP of small domestic establishment, theyshould never stop giving credit to their customers.

QUALITY: Small domestic establishment should be consistent in improvingthe quality of goods. This is the major reason of lagging behind incompetition.

Customers are not satisfied with the issues of exchange ofproducts due to bad quality, with the small domestic establishment. So ifthe quality is improved so there will be no case of exchange.

PRICE: Small domestic establishment should set standard market pricesand not charge higher even if it is a case of 50 paise, because nowadayscustomers are very much price conscious.

MARKETING: As the Small domestic establishment does not have that

much capital as in the case of organized retailers so they lack in

advertising. But they can gain advantage of word of mouth publicity by

providing good quality products and services.

SERVICES: On time delivery of products should be taken care of by Small

domestic establishment because they lack in providing this services.


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APPENDICES

Retailing is derived from the French word retailer, which means to cut a

piece off.

MBO - Multi Brand outlets

PRIL - Pantaloon retail India limited

Unstructured questionnaires: are usually open ended and try to probe

into the mind of respondent, allowing the interview to express his own

thoughts rather than restricting him to the available response options.

QUESTIONNAIRE FORFOOD & GROCERY


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Name and Address of Retailer:-

1) What is your store Name?

____________________________________________________________

2) How many years old your store?

____________________________________________________________

3) What kinds of product are offered by you to your customers?

Fruits

GroceriesMilk products

Species

Ready to eat food

Biscuits & confectionaries

Cold drinks

General Merchandise

Others

4) How many customers visit your store daily?

Less than 50

50 100

100 150

5) What is your total customers base?


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6) Do you think any of the following things has happened because of

organized retail stores?

Not at all Somewhat considerable Cant say

Decrease in total no.

of customer base

Frequency of

purchase of

individual customers

Reduction in their bill

size

Demand of more

facilities like big

business group

shopping mall

Decrease in annual

turnover

7) What will be the effect of the following factors in influencing or switching

away your regular customers?

High Impact somewhat No impact Cant say

Good aesthetic

Atmosphere

Prime location

Friendly store person

Selling supplementary


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items(large variety)

Discount offer

High advertising &

promotion

Big brand name of the

company

Free home Delivery

8) Which of your products get affected with the advent of organized firms in

your city?

Not at all Some What Considerable Cant say

Ready to cook

Milk products

Vegetables

Fruits

Groceries

Species

Biscuits &

confectionaries

Cold drinks

General

merchandise


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9) Which services or facilities you offer to maintain your loyal customers?

CreditFree home delivery

Order taking on telephone

Fast delivery

Discounts

APPAREL QUESTIONNAIRE

Name of Retailer:-

Address:-

1. What is your store Name?

2. How many years old your store?

3. How many customers come at your store daily?

Less than 50


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50 100

100 - 150

4. Which of the following apparel categories are do you stock?

Ladies Wear Office wear ( formal )Party WearCasual WearFestival Wear

Kids Wear - Office wear ( formal )

Party WearCasual WearFestival Wear

Gents Wear- Office wear ( formal )Party WearCasual WearFestival Wear

5. Do you think any of the following things has happened because oforganized retail stores?

Not at all Somewhat considerable Cant say

Decrease in total no.

of customer base

Frequency of

purchase of

individual customers

Demand of more

facilities like big

business group


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shopping mall

Decrease in annual

turnover

6. As per your opinions of what will be the effect of the following factorsin drawing away you regular customers?

High

Impact

somewhat No

impact

Cant say

Good aesthetic

atmosphere

Prime location

Friendly store person

Selling supplementary items(large

variety)

Discount offer

High advertising & promotion

Big brand name of the company

Selling other households necessity

items under are roof

Offering latest Wear

Available of more Internationalbrands

Other recreational factors like

parking


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REFERENCES

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