Retail IIPM Project

8/3/2019 Retail IIPM Project

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Retail IIPM Project Document Transcript

1. 1 CHAPTER - 1 INTRODUCTION 2. 2 INTRODUCTION 1.1 Retailing Overview Retailing is one of the worlds largest

industries. It is in a permanent state of change, and the pace of this change has been

accelerating over the last decade. From the marketing perspective, retailers are, bydefinition, closer to the consumer than manufacturing companies. Retailers represent theculmination of the marketing process and the contact point between consumers andmanufactured products. While retailing has long set buying decisions as its highestpriority and was very focused on the product assortment, it now follows a more holisticapproach to management and marketing and is seizing the opportunity to be consumeroriented, engage in the personal contact with customers, gather information on consumerbehaviour and exploit insights into consumer behaviour and preferences. What was oncea simple way of doing business is transforming into a highly sophisticated form ofmanagement and marketing. Retail marketing consistently features more efficient, moremeaningful and more profitable marketing practices. Modern retailing has entered India

in form of malls and huge complexes offering shopping, entertainment, leisure to theconsumer as the retailers experiment with a variety of formats, from discount stores tosupermarkets to hypermarkets to specialty chains. However, kiranas still continue toscore over modern formats mostly due to the convenience factor i.e. near to their house.This organized segment typically comprises of a large number of retailers, greaterenforcement of taxation mechanisms and better labour law monitoring system. It's nolonger about just stocking and selling but about efficient supply chain management,developing vendor relationship quality customer service, efficient merchandising andeven the labour class is also in the working process timely promotional campaigns. Themodern retail formats are encouraging development of well-established and efficientsupply chains in each segment ensuring efficient movement of goods from farms to

kitchens, which will result in huge savings for the farmers as well as for the nation. Thegovernment also stands to gain through more efficient collection of tax revenues.Network marketing has been growing quite fast and has a few large players today. Gasstations are seeing action in the form of convenience stores, ATMs, food courts andpharmacies appearing in many outlets.

3. 3 In the coming years it can be said that the hypermarket route will emerge as the mostpreferred format for international retailers stepping into the country. Estimates indicatethat this sector will have the potential to absorb many more hypermarkets in the next fourto five years List of retailers that have come with new formats: Retailer Current FormatNew Formats Shoppers Stop Department Store Quasi-mall Crossword Large BookstoreCorner shop Piramyd Departmental Store Quasi-mall, Food retail Pantaloon Own brand

store Hypermarket Globus Department Store Small fashion stores Traditionally, thekirana retailing has been one of the easiest ways to generate self- employment, as itrequired minimum investment in terms of land, labour and capital. These stores are notaffected by the modern format of retailing. In order to keep pace with the modernformats, kiranas have now started providing more value-added services like stockingready to cook vegetables and other fresh produce. They also provide services like credit,`phone service, home delivery etc. The organized retailing has helped in promotingseveral niche categories such as packaged fruit juices, hair creams, fabric bleaches,


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shower gels, depilatory products and convenience and health foods, which are generallynot found in the local kirana stores. Looking at the vast opportunity in this sector, bigplayers like Reliance has announced its plans to become the country's largest modernretainers by establishing a chain of stores across all major cities. Apart from metro cities,several small towns like Nagpur, Nasik, Ahmadabad, Aurangabad, Sholapur, Kolhapur

and Amravati has seen the expansion of modern retails. Small towns in Maharashtra areemerging as retail hubs for large chain stores like Pantaloon Retail because many smallcities like Nagpur have a student population, lower real estate costs, fewer power cuts andlower levels of attrition. However, retailers need to adjust their product mix for smallercities, as they tend to be more conservative than the metros. In order for the market togrow in modern retail, it is necessary

4. 4 that steps are taken for rewriting laws, restructuring the tax regime, accessing anddeveloping new skills and investing significantly in India. This chart is showing threelines mainly, overall retail sales; food, beverages and tobacco segment sales and clothingsales. And here researchers focus is on clothing segment. So let now discuss aboutapparel industry. As we know apparel is one of the basic needs of any person. And now

in India, either a rural person or an urban person, all prefer these easy and 5. 5 comfort retail formats for them. As a research conducted by KPMG/research firm; inIndia, in rural segment there is a 61% spending and in urban market, there is 39%spending. Indian Organized Retail is set to explode with Food & Lifestyle retail as majorsegments And apparel industry is also one ofthese SBUs; so definitely these all thingsmake it more valuable than others. India is on the radar screen in the retail world andglobal retailers and at their wings seeking entry into the Indian retail market. The marketis growing at a steady rate of 11-12 percent and accounts for around 10 percent of thecountrys GDP. The inherent attractiveness of this segment lures retail giants and

investments are likely to sky rocket with an estimate of Rs 20-25 billion in the next 2-3years, and over Rs 200 billion by end of 2010. Indian retail market is considered to be thesecond largest in the world in terms of growth potential.

6. 6 TABLE1 India Retail - Share of Categories (per cent) 2003-04 2004-05 2005-062006-07 1. Food & grocery 66.4 62.5 61.7 59.6 2. Beverages 2 2.7 3.1 3.6 3. Clothing &7.3 8.8 8.6 9.3 footwear 4. Furniture, 4.8 5.8 6.2 6.8 furnishing, appliances & services 5.Non- 9 8.6 8.5 8 institutional healthcare 6. Sports goods, 2 2.4 2.6 2.7 entertainment,equipment & books 7. Personal care 3.5 3.8 3.9 4.2 8. Jewelers, 5 5.4 5.4 5.9 watches, etcTotal Retail 100 100 100 100 Source:http://www.expresshospitality.com/20080615/management07.shtml 1.2 ApparelRetailing

7. 7 The order of present day business being global, a constant adaptation and reinventionof marketing strategies is imperative so as to face the challenge of satisfying the localcustomers in the global markets. In the Retail sector, India is currently witnessingtremendous growth; but there has been a dismal performance by many owing to the factthat Westernised formats in India have been blindly followed and replicated withoutconsidering the abysmal differences in all types of macro and micro environmentalfactors. So it is obvious that we need to find out some solutions for the retails in India,keeping in mind the intrinsic differences in the people across the country in terms ofculture, economic condition, purchase attitude and so on. This paper attempts to highlightthe differences in Retail Purchase Factors across customers and suggest a way out for


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effective marketing & assortment for apparel outlets with local orientation. Keywords:Retail, Purchase behaviour, Consumer behaviour, Proximity, Price, Product Assortment,Ambience, Service, Communication A smart product mix is vital for the apparel supplychain Style, fashion and brand image all capture the imagination of consumers shoppingfor value in apparel items. However, increasing the product mix to ramp up market share

can also lead to operational losses and non- fulfilment of the delivery schedule.Increasing market expansion and fashion volatility are all intensifying competition in theapparel chain, and companies are being forced to diversify their products in an attempt toimprove market share. This diversity is largely determined by attributes such as design,handle, size and fit - and leads to a correspondingly wide spectrum of upstreammanufacturing parameters and small batch sizes. These, in turn, are major hurdles inmeeting delivery schedule and quality standards, which severely affect the marketabilityof a brand. It's a typical problem faced by apparel supply chain, where the scheduling ofwork becomes complicated by the introduction of a highly diverse range of products.This complexity makes it more difficult to manage a given product basket in terms oftime, cost and serviceability. Moreover, product replenishment in the apparel supply

chain assumes a new dimension, as global sourcing becomes the order of the day withraw material supply; manufacturing, distribution and retailing all are dispersed across theglobe.

8. 8 Under these circumstances it becomes mandatory to "get the right product to theright place at the right time at the right price." Factors Affecting ReplenishmentReplenishment of merchandise is dependent on: 1. Type of merchandise 2. Type of store3. Storage capacity of the store 4. Lead times for supply of goods 5. Rate of sales 6.Relative stock positions across the chain 7. Planned marketing activity 8. Ensuing eventslike seasonality 9. Beginning, Mid or end of season Basic Concept on ReplenishmentThere could be SEVERAL other factors like commercial contracts, priority on stores etc.that affect the replenishment Fundamentally replenishment is driven by standardreplenishment models and variables Minimum stocks Maximum stocks Re-orderpoint Re-order quantity Economic order quantity

9. 9 Lead time for replenishment Effect of Merchandise Type on ReplenishmentFashion retail best practice is to: Categorize entire merchandise into: 1. Regulars -Carried through all seasons 2. Seasonal - Carried through one or two seasons 3. Fashion -Carried only once and only one delivery is expected Apparel fashion has always changedno matter what category of apparel it is, and mens business wear is no exception. Socialforces are believed to influence fashion including Replenishment efforts in terms of Min /Max / EOQ etc. is set ONLY for Regulars and a few Seasonal mens. Ones spouse,

family and culture are some of the forces that change fashion. An example of ones spouseinfluencing an individual, when he buys apparel, is that she may accompany him andoffer suggestions when he purchases items of apparel. A male consumers family and

culture can influence his purchase decision because of the social interaction he has withthem, including whether his dress is acceptable to the group. Identification of the role ofapparel as a sign of business success is not a new concept. A review of related literaturerevealed that self-image/product image congruity was related to an individuals behaviorto a particular item and that apparel products had symbolic meaning. Studies haveconsidered the relationship between the self and apparel and have taken into account thevarious aspects such as actual self-image and ideal self-image. If the image of an outfit


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were a positive match with the self-image, including both the actual self and the idealself, the apparel item would be worn most of the time. The Multi-Fibre Agreement(MFA), that had governed the extent of textile trade between nations since 1962, expiredon 1 January, 2005. It is expected that, post-MFA, most tariff

10. 10 distortions would gradually disappear and firms with robust capabilities will gainin the global trade of textile and apparel. The prize is $360 bn market which is expectedto grow to about $600 bn by the year 2010barely five years after the expiry of MFA.An important question facing Indian firms is whether their capabilities and their diversesupply chain are aligned to benefit from the opening up of global textile market? Thehistory of textiles in India dates back to the use of mordant dyes and printing blocksaround 3000 BC. The diversity of fibres found in India, intricate weaving on its state-of-art manual looms and its organic dyes attracted buyers from all over the world forcenturies. The British colonization of India and its industrial policies destroyed theinnovative eco-system and left it technologically impoverished. Independent India sawthe building up of textile capabilities, diversification of its product base, and itsemergence, once again, as an important global player. Today, the textile and apparel

sector employs 35.0 mn people (and is the 2nd largest employer), generates 1/5th of thetotal export earnings and contributes 4 per cent to the GDP thereby making it the largestindustrial sector of the country. This textile economy is worth US $37 bn and its share ofthe global market is about 5.90 per cent. The sector aspires to grow its revenue to US$85bn, its export value to US $50bn and employment to 12 million by the year 2010(Texmin 2005). In the Indian Market so many National as well as International brand in

different apparel segment which include: Corporate Wears Ethnic Wears SportsWears Casual Wears Players in Apparel market As we have discussed that there are somany players are ruling in the Indian apparels industry out of which some players arenational Players & some players are of International standards

11. 11 Every player have their different product portfolio in a particular apparel segmentOr there are many players in each apparel segment which we have discussed above i.e.corporate/formal wears, ethnic wears, Sports wears & casual wear segment Players Corporate Wears segment LOUIS PHILLIP JOHN PLAYERS PROVOGUE PETERENGLAND PARK AVENUE DONEAR MAYUR Casual WearsSegment SPYKAR

12. 12 PEPE LEECOOPER MONTE CARLO LEVIS CHARLE OUTLAW KOUTONS DUKE COTTONCOUNTY Ethnic Wears Segment

13. 13 TIMBERLAND LIBAS FAB INDIA MILLIONAIRE HERITAGE DIWAN SAHEB AMARSONS SIYARAMS VIMAL CAMBRIDGE SportsWears Segment REEBOK NIKE ADIDAS FILA YONEX HEAD PUMA

14. 14 POLO 1.3 In Apparel Segment and Merchandise Assortment Planning Merchandise planning. The most critical decision in any consumer goods value chain iswhich merchandise to stock. But this decision, although ultimately driven in retail by thebuyers judgment, must draw on data and analytics that evaluate, based on historicdemand) the relative likely revenue and margin resulting from different merchandiseportfolios, and test the feasibility of the portfolios against constraints such as store spaceor labor availability or the firms available working capital. Size optimization. Forretailers selling footwear or apparel a statistical understanding of the distribution of sales


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by size by store is vital in order to meet consumers needs and avoid mark downs andstock outs. Its well known that consumers sizes vary from one region or to another, with

North Indians for example in general being taller for example than population from theNorth East region of India but retailers need powerful sparse data analytics to plan for thedifferences in populations that visit urban and out of town stores. Space optimization.

Retailers provide space in stores in proportion to their expect sales and margin for eachmerchandise item. But the complex tradeoffs between affinity items, with differentmargins and attracting different promotional funds simply demand an enterprise analyticapproach rather than single user planning tools. Revenue optimization. For retail,

decisions about pricing and mark downs are critical to the achievement of financial goalsand while analytics are widely deployed to understand the likely overall impact forexample of a promotion on volume and profit the real challenge is to solvesimultaneously the merchandise assortment, pricing optimization and space managementfor each store within the retailers supply chain and working capital constraints Packoptimization. Pack optimization balances the complex cost and velocity trade offs atdifferent points in the supply chain between moving only highly aggregated quantities,

for example pallets and shipping highly disaggregated units. For example single SKUs orStock Keeping Units. 15. 15 Issues such as what merchandise to purchase and in what quantity, are of strategic

significance to every retailer, especially for the multi-store retail chains of today. Fordecisions on these matters, a thorough plan called a merchandise assortment plan has tobe adopted. And as clothing is one of the basic needs of every person. So definitelyapparel industry has a wide scope. Thats why right now many players are operating inthis industry and new players are also coming. So competition is also increasing in thisindustry day by day. And as retailing environment is emerging now a days and Indianeconomy is also developing so a wide range of fashionable and trendy clothing isavailable now and customers have a lot of options in their hand thats why it is essential

for every retailer to position themselves as a different and best option for customers. Forevery industry, its product range and varieties are the best way to attract and retaincustomers. Thats why this concept of merchandise and assortment planning emerged and

now most of retail organizations focusing on this for being alive in the market. Theretailer must make decisions regarding the merchandise offered depending on the salestargets and financial objectives of the store. Merchandise comes in a variety of sizes,colours, makes and models. Retailers should be very careful while deciding on theamount of stock to be maintained in each category, if large stocks are maintained in aparticular category, there may not be sufficient resources left for providing a deeperassortment of goods. Hence, the retailer should establish a trade-off between the type ofcategories or assortment and the inventories being maintained. This is called merchandiseassortment planning. An assortment plan depicts what should be carried in a specificcategory of merchandise. An assortment plan for a merchandise category based onfashion will not identify particular stock keeping units, because fashions vary from yearto year and sometimes, from season to season. The more fashion-oriented themerchandise category is, the more necessary it is for the merchandise planner toaccommodate changes in fashion, and hence, the lower the level of detail in theassortment plans. The starting point for developing an assortment plan for a given seasonis the historical data for a particular merchandise category. Apart from the assortment


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plan for a merchandise category in the previous season, sales, inventory turnover andGMROI (Gross margin return on inventory investment) figures are used to develop anassortment plan for the current season. The merchandise planner then makes the required

16. 16 changes according to his expectations of what products or fashions will be reallysignificant for the coming season. TABLE- 2 Assortment Plan For Boys Jeans Style

Straight-leg Straight-leg Straight-leg Loose-fit Loose-fit Retail price 999 1399 1799 12991599 (in Rs.) Type of Regular Stone Tinsel- Broken twill Over dyed Fabric denimwashed Lyera based denim denim Colours Light blue Dark blue Light blue Light blueBlue Black Indigo Black Black Black Black Deep blue Figure: Assortment Plan forBoys Jeans at Spykar Source: Data collected from Spykar team. This plan describesgeneral styles, price levels, fabric composition and colours. The process of developing anassortment plan can be quite complex, especially in multi-store chains like ShoppersStop, Pantaloons or Food World. An effective assortment plan requires equal or moreeffective sales, inventory turnover and GMROI forecasts, to complement the experiencedjudgment of the merchandise planner. 1.4 RESEARCH PROBLEM/OBJECTIVES OFTHE STUDY The study was performed aiming at the following objectives:

17. 17 Primary Objective of the study- Understanding the merchandise assortmentplanning concept and process adopting by apparel outlets at Chennai. To study aboutcustomers preferences towards it. Associated Objectives- To know about the factorsinfluencing inventory management decisions of different apparel outlets. To study

competition between apparel industry and strategies followed by them to overcome fromit. Grasping the knowledge about how customers take these decisions taken by retailersand its then their response towards it. Analyzing that difficult situation of operating

business for apparel outlets in quick- changing market conditions, competition and entryof big giants in this segment. And apart from these all stated objectives my first andforemost objective was to acquire the practical knowledge about the MerchandiseAssortment Planning like how these retailers do this process for their survival and howthey fulfil demands of customers. 1.5 LIMITATIONS OF THE STUDY Timeconstraint- The major limitation of this project is the time period for this thesis because itis not possible to look in to each and every aspect of Merchandise Assortment Planningin such a short span of time.

18. 18 Because all research is related to Chennai city only and here a limited scope isavailable for these types of studies. Sample for the study taken is of only 100

consumers. Which can also act as a constraint in the study People whom data will becollected can be biased on some time and because of lack of awareness and lack ofknowledge people can give wrong opinions. Since the results will draw on the basis of

Information which will be provide by the respondents; chance of response error mightpossible. Disinterest of customers may generate non response while collecting data. 1.6BENEFITS TO THE STUDY i. To Self- Knowledge earning.

19. 19 Gaining practical exposure to Merchandise Assortment Planning. Gainknowledge about customer preferences. ii. To company- This report will be beneficialfor companies and outlets too because from this report they get to know about theircustomers preferences. From this report they will get the knowledge about required

changes in their strategies and customer base. iii. To customers- They will get to knowabout retailers strategies and their work process. From this report they can say their


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views and their opinions about these retailing strategies, so it is beneficial for them tomake all required changes in system. CHAPTER - 2 LITERATURE SURVEY

20. 20 LITERATURE REVIEW According to Torex, a Merchandise AssortmentPlanning firm, in its online journal says that, merchandise Assortment Planning providesplanners with everything they need that helps to analyze efficiently and in a customer-

centric manner. From store layout and sizing to packing and allocation, the tools in theapplication help buyers give their customers the right product in the right place at theright time. Perhaps most importantly Assortment plan helps in giving customers and richexperience with continuous availability of fresh and appealing products.

21. 21 This results in lower inventory costs, lower markdown and increased sales.Retailers need their products to fit their demographics. Stores with different climatesneed to carry different products; thus Assortment plan must be done in different seasons.While customers expect this, its hard for retailers to achieve with basic spreadsheets.

Normally merchants plan ranges based only on the size and sales of the store. WithMerchandise Planning, buying and merchandising teams maintain consistency, both withtheir business processes and their execution. All of this adds up to decreased supply chain

management costs, lower markdown costs, increased sales and margins and a competitiveedge. Merchandise Planning allows buyers to take customer demographics into accountwhen planning ranges. They can create assortment ranges by store as well as by storeattributes. They can also plan different delivery dates to allow for seasonal differences.Source: http://www.torex.com/uk/docs/enterprise-solutions/TXDS_MPLENA4_1008_lr.pdf Surinder mishra in his article India third mostattractive market for apparel retailers has found that India has emerged the third mostattractive market destination for apparel retailers, according to a new study by globalmanagement consulting firm AT Kearney. India comes after Brazil and China in the ATKearney Retail Apparel Index, which looks at ten drivers, including apparel consumptionand clothing imports/exports, to rank the top 30 emerging markets for retail apparelinvestments. "In India, apparel is the second largest retail category, representing 10percent of the $37 billion retail market. It is expected to grow 12-15 percent per year,"said Hemant Kalbag, principal of Consumer Industries & Retail Practice, AT KearneyIndia. Gabay Gillie (2009):- The purpose of this paper is to empirically test theconsumer-centred approach to brand management theorized by Rust, Zeithaml andLemon in 2004 to assist companies in reducing the depreciation of brand equity. Brandequity was operationalized in the context of conjoint measurement. In total, 5,364respondents participated in interviews testing drivers of brand equity for six brands eachin apparels. It was found that brands did not hold much beyond their name. Companiesholding strong brands will need to define

22. 22 product design & Faison in terms of their perceived functionality across consumercutting edge methodology to test mindset segmentation by combinations of productfeatures as a new basis for brand management was used. In contrast to traditionalsegments Companies are to build and position brands around customer segments. Thestudy focused on brands in the textile industry requiring the replication to additionalindustries. Data from the large-scale study revealed that across categories brand valuemay not hold much beyond the name in the minds of consumers. It was found thatmindset segmentation may be a basis for brand management. Messages that focused onproduct functionality were found to be stronger drivers of preference of one brand over


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another. Product quality & design instead of brand names emerged as the primary sourceof value across segments. Kwan C.Y. (2004): This paper explores young Chineseconsumers decision-making behaviour towards casual wear purchase in Mainland China.Specifically, it offers empirical results on the relationship between consumers decision-making styles and clothing choice criteria towards buying casual wear. The Consumer

Style Inventory (CSI), developed by Sproles and Kendall (1986) for examining differentconsumer decision-making styles, was adapted in this study. A questionnaire survey wasemployed as the tool to collect primary data and the research instrument wasadministered to 161 University students in Shanghai, Beijing and Guangzhou in theMainland. The results show that six decision-making styles (recreational and hedonisticconsciousness, perfectionism consciousness, confused by over choice, habitual and brandloyalty, price and value consciousness, and brand and fashion consciousness) were foundin the Mainland CHAPTER - 3 RESEARCH METHODOLOGY

23. 23 3.0 RESEARCH METHODOLOGY For the perfect thesis one has to know eachand every aspect of the concept thoroughly. And then for merchandise assortmentplanning one has to get update with the latest trends and all factors which are

continuously affecting these decisions. So acquiring the data regarding this I gonethrough by several things like: Books; Magazines; Journals; and Web site. Inorder to understand the merchandise assortment planning process, as per the objectivestated, the various steps which are to be followed are given below: a) Planning theresearch design. b) Selecting the research method. c) Selecting the sampling procedure.d) Data collection. e) Evaluating the data. f) Preparing and presenting the research report.3.1 RESEARCH DESIGN Research design essential because it facilitates the smoothflow of various research processes. In order to get the appropriate results on a clearlydefined research topic, the design chosen by the research is exploratory in nature.Exploratory studies: This research is carried out to make the problem suited to moreprecise investigation or to frame a working hypothesis from an operational prospective. It

is not used in case where definite result is desired as in our research case where onlyimpact is to be studied. This research was conducted using both qualitative andquantitative technique.

24. 24 As a part of exploratory studies the secondary data is being collected since thistopic is very highlighted in all over India and the sector growth is also very rapid. On thebasis of that in Chennai context this research is an attempt to know the perception ofChennai people and the apparel store retailers. 3.2 RESEARCH METHOD Afterdeveloping an appropriate research plan, it is important for the researcher to select aproper research method. For this research, the research method chosen by the researcherare secondary data and survey methods. a) Primary data: These are those data which arecollected afresh and for the first time, and thus happen to be original in character. I wouldbe using the structured questioners. b) Secondary data: These are those which havealready been collected by someone else and which have already been passed through thestatistical process. I have collected it from the sources like internet, published data etc.Surveys: This is a research technique, which is used to gather information from a sampleof respondents by employing a questionnaire. These surveys will be conducted amongthe: Apparel store retailers, Customers, And all the sources I got to know by the proper

guidance and immense knowledge and experience of my faculty supervisor. So these arethe main sources of my project study. 3.3 SAMPLING PROCEDURE Sampling is


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generally a part of the research design but is considered separately in the researchprocess. Sampling is a process that uses a small number of items or a small portion of apopulation to draw conclusion regarding the whole population. For this research thesampling method chosen is simple random sampling and Convenient Sampling.

25. 25 Since in Chennai, only few organized apparel outlets is their so the unorganizedretailers also being chosen for interviews and customers are chosen at random. SampleSize: Sample size is around 5 for apparel outlets to study their merchandise assortmentplanning and 90 for customers to understand their preferences, 5 for Experts interviewtotally 100. Sampling Unit: Colorplus, Derby, Raymond, Spykar and Adidas SamplingArea: I have Chosen Chennai. 3.4 DATA COLLECTION After preparing a suitablesample, the researcher collects the data from the units in this sample. As stated above thatresearch method which is used in the research comprises of surveys therefore datacollected is of primary in nature and partly secondary since secondary data also be taken.3.5 EVALUATING AND ANALYZING THE DATA. This step includes editing, coding,tabulation and processing of collected data. The Schedules are required to be editedduring the field survey for necessary corrections. After the survey was complete they are

required to be checked again for completeness, accuracy and uniformity. The next stepwas coding. Different categories were identified into which responses are classified. Thentabulation was done. Data was sorted into different categories and numbers of cases thatbelong to those categories were counted.

26. 26 PROCESS FLOW OF THE PROJECT DESIGN OF QUESTIONNAIRE 27. 27 PILOTING BASED ON QUESTIONNAIRE AFTER FEEDBACK REDESIGN

THE QUESTIONNAIRE QUALITY CHECK GETTING QUESTIONNAIRE FILLEDCORRECTION OF DATA DATA ENTRY DATA CLEANING ANALYSISFINDINGS, RECOMMENDATIONS & CONCLUSION Digram-1 - P R O C E S S F LO W O F T H E P R O J E C T

28. 28 CHAPTER - 4 DATA ANALYSIS AND INTERPRETATION

29. 29 4.1 Data collected after survey

Researcher went to all those sample units forcollecting data and found data from direct interviews and surveys from customers andretailers. Interview with Colorplus Ambattur factory outlet manager: Address of theFactory outlet (C10, Ambattur Estate, Chennai, Tamilnadu-600058) 4.2(a) Mr. Rajeev(Colorplus Merchandise Manager) has addressed on the topic that How MerchandisingAssortment planning is carried out in their outlets. ASSORTMENT PLANNING: Itinvolves determining the quantities of each product that will be purchased to fit into theoverall merchandise plan. Details of colour, size, brand etc have to be specified.

30. 30 The aim of the range plan is to create a balanced range for each category ofproducts that the retailer chooses to offer. Good range planning should essentially take

care of the following: The number of items/options available to the customer should be

sufficient at all times and should be such that it helps the customer make a choice.

Therange planning process should ensure that overbuying and under buying is limited. Sufficient quantities of the product are available, so that all the stores can be serviced andthe product should be available at all stores across various locations. Colorplus Modelstock plan: It gives the precise items and quantities that need to be purchased for eachmerchandise line. To arrive at the model stock plan, we needs to identify the attributesthat the consumer would consider while buying the product, then decide on the levelsunder each attribute and finally, allocate the total money available or the units to the


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respective item categories. The following e.g.: illustrate the steps involved in preparing amodel stock plan: Colorplus has allocated Rs.1 lakh for buying of shirts. Assuming thatthe purchase price of each shirt is Rs.100, he will be able to stock 1000 shirts in the store.Step 1:

31. 31 The first thing that is we need to do is identify which factors affect the customersbuying decision and the number of levels under each attribute. Step 2: Identify thenumber of levels under each attribute. Merchandise manager identifies the following

attributes and the levels: Type of shirt (Dress, Casual, Formal, Sport) Size (small,medium, large, Extra large) Sleeve Length (Full Sleeves, Short Sleeves) Collar Type(Seville, Button down) Colour (White, Blue, Cream, Grey) Fabric (Cotton, cottonblend) Step 3: The third step is to be allocating the total units to the respective itemcategories. Thus the units that are recommended for each item are into direct proportionto the estimated demand patterns. MODEL STOCK PLAN IN COLORPLUS: Source:Colorplus Ambattur factory

32. 32 MERCHANDISE FORECASTING IN COLORPLUS Forecasts are projections ofexpected retail sales for given periods. Is tomorrows expectation based on yesterdays

achievements and today's plan is the foundation of merchandise plans. TYPES OFFORECASTS include Overall company projections Product category projections Item-by-item projection Store-by-store projections One way to forecast sales for narrowcategories is to project sales on a company basis and by department and then tobreakdown figures judgmentally into merchandise classifications. STEPS 1. Reviewingpast sales- necessary to establish if there is any pattern or trend in the sales. It gives anindication of sales in the current and future period. 2. Analyzing the changes in theeconomic conditions- Economic conditions have a direct link to the consumer spendingpatterns. Economic slowdowns or increase in unemployment all affects business. 3.Analyze the changes in the sales potential- It is necessary to relate the demographicchanges in the market to the store and the products to be sold. 4. Analysing the changes

in the marketing strategies of the retail organization and the competition- is there a newline of merchandise to be introduced, existing store to be remodelled. All these factors tobe taken into consideration. 5. Creating the sales forecast- After taking into considerationthe above mentioned points, an estimate of the projected increase in the sales is arrivedat.

33. 33 The external factors, internal factors and the seasonal trends must be anticipatedand taken into account. External factors (consumer behaviour, competition, economy anddemography) Internal factors (addition and deletion of product claim, revised promotion,credit policy, changes in hours of work) and seasonality. After a yearly forecast is derivedit should be broken into quarter or monthly. BENEFITS Reduce the cost of inventory-We can avoid under stock and overstock. Helps in setting sales target. Helps in

forming suitable advertisement and promotion programs. It helps in forecasting shortterm financial requirements and long term financial requirements. Helps in planningman power requirement. Helps in planning of a new store or expansion of an existingstore. Helps to reduce the business risk. Thus it helps to earn maximum profit.

34. 34 4.2(b) Raymond Apparel outlet According to Mr.Devendra G.Mehta, StoreManager of Raymonds branch Doveton, as technology advanced, a shift in consumerdecision making influenced buying patterns. With the ability to research and purchaseany commodity including apparels online, many consumers are no longer content to


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simply choose from a given selection in a particular store. Thus it becomes important forretailers like us to give the maximum number of variety to the consumers. The firstchallenge for retailers is to identify consumer preferences as accurately as possible. Thiscan be done by capturing decision-making data from a variety of resources, ranging fromin-store product performance to social networking options. We use this information to

create differentiated, customer-appropriate, and profitable assortments. He also said thatthey use specific software for assortment planning. This software offers the abilityproduce flexible, customizable solution. Assortment planning technology can sift throughmultiple options to generate plans based on product hierarchy or product attribute, suchas theme, collection, promotions etc... The software Raymond use can also calculateoptimal quantities based on space, rate of scale, initial distribution, and other user-definedparameters.

35. 35 4.2(c) Mr.Balajiram Adidas Store manager, Purasawalkam In our company wefollow Integrate chain level Merchandise and Location planning processes weekly. Itmeans Merchandise & Store Plans feed the Store groupings and Assortment plans, forcomplete integration. Building targeted assortments based on customer focused location

groups Plan assortments using placeholders and defined items is the key to our success.Assortment plans are initialized from targets and changes are spread down to item bystore group to provide an accurate plan with very few entries. System generated itemcounts and plan based seeding keep assortments focused. Our Allocation Strategy allowsusers to look at the full assortment in advance of allocating, and after each allocation.Continuous review and updating original assortment plans by location group to reconcilewith the latest store performance has enabled our merchandise much more efficient andeffective.

36. 36 4.2(d) Mr. Sanjeev Spykar Store Manager, Nungabakkam Our Integration withMerchandise & Store plans means that assortment roll-ups can be compared to higherlevel plans as changes in the assortment. We generate recommendation of items neededto meet plans or fit constraints. Group locations are usually based on attributes such asvolume, space and climate to tailor assortments to different customers. We manage aproduct workflow and select a size profile that will optimize order constraints with storesize need. Methods we follow to execute allocation using a best aligned with item hasbeen an intangible asset for the store. Managing In-season Merchandise & Storeprojections has made us so distinctive in terms of customer service. Advice fromspecialist consultants with years of merchandise & assortment experience has developedbest practice workflows. Systematic approach of our merchandise assortment is definitelya competitive edge in this competitive trend.

37. 37 4.2(e) Mr.Ajay Derby Store Manager, Nungabakkam. Planning by merchandisedelivery is too complicated. Merchandise plans are broken down by seasonality or launchcollections, so that new and key item Assortment plans can be driven from higher levelplans. Reviewing the assortment by multiple attributes (such as colour and fabrication) isdynamic yet simple for practice. Assortments are tailored to different climatic zones, anddistribution timings which are then offset by store group. Reviewing Allocations of co-ordinate & linked items is a standard step before release of the allocations, meaning co-ordinates are correct by store and exception filtering allows for immediate attention orcorrection. The workflow integrates all modules transparently, so the user never needs to


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move out of the workflow steps. This has made our presence in better service categoryand customers as well acknowledged it very strongly.

38. 38 4.3 Questionnaire for Retailers Q.1. Tell me something unique about your outletand brand and about your vision and mission? BRANDS RETAILERS ANSWERS Johnplayers King of apparel giving more offers and excellent promotional strategies makes

different among the competitors. Peter England The outlet prides itself on quality,assortment and detail. Adidas Universal Appeal and a very popular logo that signifiesbetter quality. Reebok Lifestyle sports casual appeal, good service signifies the outlet.Spykar Many factors such as fair publicity, affordable prices, suitable range of coloursand comfort that signifies the outlet. Venfield We offer a very broad assortment, withcontinual flow of newness that makes the outlet different. Cotton County Youth spot.Different variety with low price casual wear. Colorplus Good promotional strategies toattract customers and in terms of quality our Brand is the best. Kenith Parker Differentvariety with low cost signifies the outlet.

39. 39 Derby We give our customers the latest fashions at truly affordable prices. Sothese all apparel outlet have their own identification in market by their own brands, their

own products features, varieties. And these all things give them competitive advantageand customers are also satisfied with them. 2. Which is your target market and what youdoing to capture it? Ans. - As given in above questions answer, these all retailers havetheir own target markets and their all efforts are focused on capture as high market shareas possible. TARGET MARKET VARIOUS BRANDS Formals John Players, PeterEngland. Casuals Adidas, Reebok, Spykar, Cotton County. All family apparel marketKenith parker, Color plus, Venfield, Derby. Childrens market Gini & Jony, Lilliput. And

they are adopting so many strategies for it, like pricing strategies, promotional strategiesand most important merchandise assortment planning decisions. Q.3. Before takingdecisions about your product varieties and range (Merchandise Assortment Planning),what factors you considered? Ans. - For selecting what and how much merchandise they

have to purchase and they have to keep in their organization, they considers mainly-

Financial Objectives Customers preferences and demand GMROI figures Retailbrands image and good will Seasonal demand and fashion

40. 40 Q.4. Is there any proper strategy you are adopting for these decisions? Ans. - Somestores have their own strategic plans for capturing market and companys management

also helps these store owners in strategic planning. As all brands have their own visionand mission so mainly these apparel store owners also adopting same strategies for them.But as all customers have their own specialties so these retailers also have to change theirstrategies according to their own localities. As these retailers are getting their own salesplan for every year and for every month from companies. Then they make somemodifications in the plan according to the local circumstances. Q.5. Is it important to

make a prior planning or strategy for merchandise decisions? And if yes then why? Ans. -Without any planning or strategy, we can do any work but for be assure about the workssuccess we should make some planning or strategies. Same is applicable in businesscontext also. And merchandise decision is not a small aspect for any retail organization.Merchandise is the most important part for apparel industry. It shows the image of thecompany, the vision of company, customers satisfaction or dissatisfaction. So for create

a good image in customers mind and for capturing most of the market share, they have

to make a prior planning. Q.6. Are you facing any kind of problems or difficulties for


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these decisions and planning because I think in a city like Chennai, it is not possible tokeep a deep variety and we cant keep a limited range of variety also because of quickly

changing customers preferences and competition? Ans. - Yes this thing is also veryimportant for any apparel retailer. Sometimes because of brands image and influencing

customers they have to keep that merchandise also which have no demand in market but

often they prefer only that merchandise which has demand in local market. 41. 41 Q.7. Are all decisions related with your outlets merchandise are independentlytaking by you or is there any interference or support by companys side also? Ans. - Fromthe above question it is clear that local retailer got support from company side too fortheir strategies and planning and they make some changes according to the localcircumstances for their merchandise assortment planning. Q.8. Do you think your plansare going well according to your expectations? Ans. - Different approaches are followedby the retailers. As, Adidas, Reebok, John Players these are some of the outlets, whichconsists of high range of products with maximum prices. So in Chennai, customerssometimes prefer and sometimes do not prefer these types of clothing because of its highprices. And others retailers as Cotton County, Derby, have low range products also and

people of Chennai like these products much so these retailers enjoy more price than highprice showrooms in Chennai. 42. 42 4.4 Questionnaire for Customers TABLE-3 Q.1. From where you prefer to buy

apparels- a) Any traditional store (unbranded) or b) A branded retail outlet. Ans. - Mostlypeople from Chennai prefers branded clothing. 55 people from total 90 customers saidthis. And others prefer unbranded and traditional store clothing. Customers Preferences

Percentage Branded 61 Unbranded 39 CHART-3 Inference: From the above statisticalinformation it is clearly visible that people are more conscious about the brand they buy.So, they indulge in spending their valuable money on buying branded apparels rather thanshelling money on un-branded apparels. In my intensive research, I have found that 61%of people choose to buy clothes from branded outlets.

43. 43 TABLE-4 Q.2. What factors you are considering before taking any apparelpurchasing decision, most- Ans. - As research is being conducted in Chennai so, heremost people prefers Quality factor is most important thing for them. And they cancompromise with Price but they want fashionable and good looks items. Most affectingfactor for purchase No of people Price 24 Quality 43 Variety 7 Looks 5 Fashion &Trends 11 CHART-4 Inference: From the research undertaken by me, I found that thepeople are more concious towards the quality of the apparels they buy. They also givemore importance to the price of the product which may be influenced by the presentrecessionary condition. Other notable factors that affect the purchasing decisions areFashions & Trends, Variety and Looks. TABLE-5

44. 44 Q.3. Are you satisfied with the services and varieties of products provided by theseapparel outlets? Ans:- Choice of Customers No.of.Customers Highly Satisfied 17Satisfied 34 Neutral 25 Dissatisfied 9 Highly Dissatisfied 5 CHART-5 Inference: Frommy research I have found that the consumers are quite satisfied with the purchase.Important thing is that they are getting large categories with low prices because of highcompetition. So customers are satisfied with all these retailing scenario because it is infavour of them. TABLE-6 Q.4 Which apparel outlet you prefer most for buying clothing?(To college students) a) Spykar


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45. 45 b) Ven field c) Adidas d) Reebok e) Kenith Parker f) Color plus g) Derby h)Cotton County i) Or any other organized or unorganized retail outlet Ans.- Favouriteoutlet(to college students) No. of male Youth Spykar 4 Ven field 11 Adidas 5 Reebok 7Kenith Parker 6 Color plus 18 Derby 16 Cotton County 14 other organized orunorganized retail outlet 9 CHART-6

46. 46 Inference: From the research I have found Color plus is highly preferred amongcollege going students. They also have options like Derby, Cotton County, but they dontprefer brands like Adidas, Spykar much. TABLE-7

47. 47 Q.5. Which apparel outlet you prefer most for buying clothing? (To male youngprofessionals) a) John Players b) Peter England c) Derby d) Cotton County e) Color plusf) Or any other organized or unorganized outlet Ans.- Favourite Brands No. of. maleYoung Professionals John Players 14 Peter England 6 Derby 22 Cotton County 9 Colorplus 28 other organized or unorganized outlet 11 CHART-7

48. 48 Inference: From the research I have found Colorplus is highly preferred amongyoung Professionals. They also have options like Derby, Cotton County, but they dontprefer brands like Cotton County, Peter England much. TABLE-8

49. 49 Q.6. Which apparel outlet you prefer most for buying clothing? (For childrenapparel purchasing) a) Lilliput b) Gini & Jony c) Or any other organized or unorganizedoutlet. Ans. Favourite brands(children apparels) No. of. Customers Lilliput 24 Gini &jony 6 Other Organized & Unorganized Retailers 51 CHART-8

50. 50 Inference: From the Research I have found that parents purchase clothing for theirchildren in Organized & Un-organized retail apparels rather than purchasing it frombranded outlets. It reveals that they are price conscious but brand name is not preferenceto them. TABLE-9

51. 51 Q.7. Do you think in organized retail store, a customer have less opportunities forbargain, less number of choices, high prices, less knowledge and so many other negativefactors? a) Yes b) No c) We can ignore them. Ans.- CHART-9 Inference: From theResearch I have found that people dont have much opportunity to bargain. Thus, peopleare compelled to buy the apparel at a price charged by the retailer. I have found that thegreater portion of the sample size has no other option other than to buy at a fixed price.TABLE-10

52. 52 Q.8. Then what you think is this new retailing scenario, good for India? As inIndia, literacy rate is so low, people are not so much aware about new retail concept. Soin this time does it has a good future in India or not? a) Yes, definitely b) No, not at all c)Cant say anything now, let see in future. Ans.- Retailing Scenario No. of Customers Yes,definitely 43 No, not at all 19 Cant say anything now, let see in future. 28 CHART-10Inference: From the research I have found that India has a good retailing future mainlydue to the size of population and the increased purchasing power. Growing westernculture in wearing the apparels is yet another reason for the bright future. TABLE-11

53. 53 Q.9 So do you want to keep your loyalty with your favourite brand or can switch?Customer Loyalty towards No. of customers brands Brand Loyal 51 Any Brand, nomatter 22 strictly based on recommendations 17 CHART-11 Inference: From the researchI have found that the People are more brand conscious in urban side. It is due to the highincome level and people relate a brand to themselves. It was found that 46 people out of80 people prefer branded items, 19 dont give importance to brand and the remaining


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strictly make their purchasing decision based on the recommendations of others. TABLE-12

54. 54 Q.10. If you have to give marks to your favourite brand from out of 10, then howmuch will you give? Ans. MARKS NUMBER OF CONSUMERS GIVEN MARKS INTHIS CATEGORY 10 7 9 17 8 19 7 15 6 11 5 8 4 6 3 4 2 3 1 0 CHART-12

55. 55 TABLE-13 56. 56 Q.11. List out the Top 5 Brands that you prefer with specific Top of MindRecall for those preferred brands with reason: Brands Reasons 1.

.. . 2. ..

. 3. .. . 4... . 5. ...

.. Top Brands & Reasons No. Of. People Colorplus (Esteem

look) 36 Derby ( offer price) 27 louisphillipe(attraction) 13 levis (gentle look) 8 Spykar(best fit) 6 CHART-13

57. 57 Inference: From the research I have found that Colorplus holds a strong brandrecall which inturn adds to the brand value. Derby comes next followed by louis phillipe,

levis and spykar. 4.5 Experts mail interview: 58. 58 Mail interview has been conducted with Experts in apparels and MarketingProfessionals working in different organizations to get their feedback. 1. What is youridea on when one should start with the Merchandising assortment planning process? Firstwe have to know the Depth and Breath of our available stock. 2. How do you think thatmerchandising assortment planning process fits into the rest of the Business? If theassortment process is good enough the conversion of prospects to buyers is easy. 3. Canyou share your views on GMROI and how does it impact business? It plays a major rolein Retail Business, we can easily identify in which category the business is making moreprofit, So that we can give preference for that particular Brand or category 4. Can I havesome inputs on merchandising assortment planning for lean Sales? We can give someoffers to that particular Articles or make it as bundle offer like 1 Plus 1, 2 for 1 like tat.Name of the Expert: P.Balajiram Designation: Adidas Retail Store Manager(Purasawalkam) Contact number: 9840354893

59. 59 1. What is your idea on when one should start with the Merchandising assortmentplanning process? We put the effort into Merchandise Planning "in order to increaseprofitability". Profitability is the key driver of most businesses. At the end of the daythough, it is the business requirements that dictate where should start. By making surethat our efforts are targeted and attainable, we can be sure that our starting point is a goodone. 2. How do you think that merchandising assortment planning process fits into therest of the Business? Merchandise Planning needs to span the activities between settinglong term, high level goals for sales, margin and investment for the business, right downto the allocation of space within an individual store for a defined S.K.U. By using theconcept of merchandise planning in our retail outlet conversion of prospects to buyers iseasy and this is how it fits into the business. 3. Can you share your views on GMROI andhow does it impact business? Gross Margin Return on Investment (G.M.R.O.I.) that canprovide invaluable insight into merchandise performance. More preference can be givento the product which is moving and less preference to the product which is not moving sothat it can reduce the space outlet and stock holding pattern. 4. Can I have some inputs onmerchandising assortment planning for lean Sales? Buy 1 get 1 free, purchase 4 shirts and


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pay the highest amount among the 4 shirts etc and a good customer service that satisfycustomers. Name of the Expert: Mr.Srinivasan Designation: General Manager of Hi-style

60. 60 1. What is your idea on when one should start with the Merchandising assortmentplanning process? To increase the profit margin we can startup with Merchandiseassortment planning because that will increase the sales and avoid pitfalls. 2. How do you

think that merchandising assortment planning process fits into the rest of the Business?To control the business critical success factor will be defined and achievement againstthese will be measured using Key Performance Indicators. Setting of key performanceindicators will lead targets for buying-in margin, stock-holding levels and mark-downpercentages. The implementation and monitoring of a plan to meet these success factorswill hopefully result in the eventual purchase by a customer of a specific item in a store.3. Can you share your views on GMROI and how does it impact business? In simpleterms it tells us how many times over a year we get our stock investment returned with agiven margin. GMROI is used as an important application in which it gives a greaterpotential to a product which sells more than other product in specific branch, From thiswe can make better informed decisions as to which should have more space allocated to

them, be better supported by stock or have ranges expanded or contracted. 4. Can I havesome inputs on merchandising assortment planning for lean Sales? To attract customersmore discounts and offers are given. Today branded outlets put more offers andcompliments to attract customers. Name of the Expert: Mr.Javeed Designation: Storemanager of Cotton County Contact number: 9941344980

61. 61 1. What is your idea on when one should start with the Merchandising assortmentplanning process? There are two major areas of profit leakage in retail. Firstly lost salesresulting from lack of stock and secondly forced margin reductions due to excessivestock. So in order to sustain and to overcome from this leakage is good way to start withMerchandise Assortment planning. 2. How do you think that merchandising assortmentplanning process fits into the rest of the Business? To increase the sales and profit marginMerchandise assortment planning is useful. On the other side it gives customersatisfaction. 3. Can you share your views on GMROI and how does it impact business?GMROI as a potential metric that we might consider in our assortment planning. Grossmargin % gives us a measure of relative profitability without taking into account the costsof stockholding investment. Weeks cover tells us how effectively we turned our stockwithout informing us about relative profitability. This enables us to forecast the businessat which it credits more profit and concentrate on it. 4. Can I have some inputs onmerchandising assortment planning for lean Sales? Offers will be provided when there ishuge stock E.g. Aadi sale. End-of-season must- ship logic to push excess inventory.Name of the Expert: Dinesh G. Mehta Designation: Manager of Raymond shop inDoveton.

62. 62 Contact number: 9283161144 1. What is your idea on when one should start withthe Merchandising assortment planning process? Once the outlets are established and thetime we come to know about our customer exact needs and the customer base and theircapabilities of the customer in that locality we could go in for the merchandisingassortment planning. 2. How do you think that merchandising assortment planningprocess fits into the rest of the Business? The MAPP fits almost the same way for the restof the business except for we do more for merchandising the Brand name rather than tothe assortment in the capital business. 3. Can you share your views on GMROI and how


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does it impact business? The impact is it enhances the growth of the business as thismakes easy and comfortable for the customers to choose their preferences according totheir needs with spending less amount of time. Definitely the ROI is seen growing andachieved faster. 4. Can I have some inputs on merchandising assortment planning for leanSales? For lean sales, we can do, compliment sales, more discount, make customer feel

the value for the money paid, good customer service, increased guarantee and couple itwith some good sales. Name of the Expert: J.Jambukeswaran 63. 63 Designation: Carl Zeiss India Chennai Branch Service Manager - South Contact

number: 9340043773 CHAPTER - 5 FINDINGS 64. 64 FINDINGS Business is like a coin that termed as a coin which has two sides,

considering one side as bane and other side as boon. Some factors which are continuouslyaffecting every business, they are Growing economy, globalization, retail trends,increasing income levels, healthy life-style, technical advancement; So we can say this isa golden period for business world. But on the other side because of increasingcompetition, inflation, high customization; these business persons are finding some newand effective ways to overcome these problems. And in apparel segment, it is worlds

biggest business industry. Clothing is one of the basic needs of a common person. So inevery circumstance, this is a sector which is definitely going to make profit. And it willincrease more and make a brand leader of this segment only by adopting some lateststrategies i.e. Merchandise Assortment planning. As researcher have taken interviewsfrom some executives from various apparel outlets, from that collected data and analyzed

that- About retailers- Retailers are very much aware about this and they are makingtheir all strategies according to it. There are so many factors which came in front oftaking these decisions i.e. price, quality, fashion/trends, looks, brand name. And after

considering these all, retailers choose the best product mix for their outlets. And it isnot a story of only big giants, even small players and traditional shopkeepers also now

adopting these strategies to attract and retain customers. Now a customer can find all

those features and product which he thinks, in a single store only because of theseplanning. For example, in a single outlet a range of various styles in various sizes invarious colours product is available. (apparel segment)

65. 65 Before these decisions a retailer considers so many other factors too like salestargets, financial objectives etc. In merchandise assortment planning, for these retailoutlets, apparel companies are also providing support to them so that they can make

profits for themselves and for company too. Basically apparel industry is based onlatest fashions and trends. And fashion remains for a little time of period. So it is toodifficult to keep a wide number of varieties in their stores for retailers. As fashionbecome outdated their stock of inventory will become waste. So they are very muchconsidering merchandise assortment planning and other benefit providing by apparel

companies to them. If it happened that fashion will become outdated then companies willalso provide full support to these outlets and they share loss also with them. Customers

preferences about it- The main thing which researcher found about customersperception about it that they said, When we wear any branded apparel thenautomatically they feel a sense of satisfaction, a sense of grace in them. Said by Sathish

and Ajay. And Mr. Krishnan said they prefer mainly the discounts or any offers inoutlets. According to him because now in market all companies are providing a good and

similar quality, so why not we go for a discount store. A tea-staler in front of Peter


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England outlet, Mr. Arokia swamy said he also wears Peter England shirts and the store

owner also provides him a high rebate for it and in this he feel more confident. Mr.Deepak said he prefer the goodwill/ brand name for purchasing any new apparel. As hesaid he prefers Peter England and John Players more than Kenith Parker or Cotton

County. Miss Anitha said when John Players launched their new segment, Miss

Players, from that time she prefers Miss Players outlet for a new purchase. Andaccording to Mr. Shah, because of Hrithik Roshan, as a brand ambassador of JohnPlayers, he also prefers John Players.

66. 66 Different customers have their own demands and needs so their preferences alsovaried from each other. But mostly youth/ college going Students of Chennai preferColorplus and Spykar Outlet for apparel purchase. While young business persons andprofessionals prefer Colorplus, Derby and John Players for apparel purchase. And inchildrens segment, a surprising result came after research that is mostly parents prefertraditional outlets for childrens apparel purchasing. Because in these outlets, they willfound more varieties and apparel categories then a branded outlet and they can make here

a high bargaining also. But if we see overall result, so today even so many branded

outlets are here in market then also mostly people prefers traditional outlets forpurchasing apparels. One thing is that also these branded clothing is available in theseunbranded outlets too and on these unbranded outlets, customer found these clothing atmuch cheaper rate then their own brands outlet.(Mostly people think this) So researcheranalyzed so many important and some funny aspects also but these all analysis shows thebooming stages of retailing in India. And for these retailers so many things are importantfor making profits as brand name, brand ambassador, quality, price, displays/advertising,discounts and categories of merchandise. And researcher found that Merchandiseassortment is a vital need for them. After adopting these strategies now they are feelingthe change in terms of customer base, in terms of brand equity, in terms of profits and interms of happiness.

67. 67 CHAPTER - 6 SUGGESTIONS 68. 68 SUGGESTIONS During the period of my extensive research I have come to know

that there are few weaknesses in the Apparel outlet. Customers have several problemsregarding some products and service offered by the retailers, which the apparel outletsshould overcome. The following strategies will help the retailers to retain their existing

customers. Range of clothes differs from one outlet to another outlet of the same brandand so perception of customer gives bad credit to the brand. So the company should take

decision to make it available in all the branches to satisfy the customers. In Chennaiyouth is aware about the National & International brands but due to tough competitionwith Unorganized Apparel outlet so companies should expand their branch and

distribution networks. To be more precise Apparel outlets can use Software for

Merchandising Assortment planning because that will increase the Sale and reduce timewhen it is done automatically. The parking space should be extended becausecustomers feel discomfort when they park their vehicle outside. ("When these apparelshops can have more than six floors to showcase their products, why cannot they providejust one floor for parking?" wonders a shopper.)- addressed in Hindu Business lineinternet Edition. Source: -http://www.thehindubusinessline.com/2005/11/01/stories/2005110102050800.htm


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69. 69 The number of trial rooms available at Apparel outlets is very less as comparedto the number of people coming. This usually results in long queues and waiting bycustomers CHAPTER - 7 RECOMMENDATIONS

70. 70 RECOMMENDATIONS Consumer of the Indian market are very priceconscious ,due to very high prices of some international brand consumer is not able to

afford that particular brands ,so companies should make some of the stuffs of apparelsavailable at the affordable price as per the geographical regions. Most of the youthmake the decision of buying the apparels when they aw that celebrity is using & wearingthat particular brands like john player brand is promoted by Hritik Roshan. So companiesshould promote their brands by endorsing the Celebrity whose personality is matching

with the brands. It is also observed that in the changing retailing environment,understanding the psyche of customer is critical to success in retailing. Aggregate levelpicture may be misleading, as it averages the beats and the valleys. Hence, individual

understanding is desirable. Indian consumers are still family-driven entities. Shopping,entertainment and eating out are family events. Since these decisions are normally groupdecisions, hence a marketer has to address family sensibilities more rigorously to woo

Indian customers. Indian customers have become more sensitive to quality, customerservice and status. She/he is ready to pay, sometimes; astronomical sums provided theirneeds are satisfied. They are basically looking for an experience, which is more of

cognitive than physical. To increase more footfalls more promotional activities must becarried out. For this Apparel outlets can either offer more discounts or increase theiradvertisements. Increase in the number of footfalls will lead to increase in sales.

71. 71 Allowing more space between the entrance of a store and a product gives itmore time in the shoppers eye as he or she approaches it. It builds a little visual

anticipation. CHAPTER - 8 CONCLUSION 72. 72 CONCLUSION From all findings collected I have reached to the conclusion that

in this quick-moving environment, now retailers also have realized that they need to work

strategically for their survival. Thats why now they are taking merchandise assortmentdecisions seriously and spending their time and efforts for it. And it is vital for them toconsider it also before doing any business. It is not only for apparel industry but now forevery business segment it is necessary. Todays scenario has totally changed from past.

Now market is totally customer-centric and highly competitive. So if any company wantsto alive here and want a long-term business then they have to fulfil all demands ofcustomers and follow all required patterns either it is a big giant or a small business unit.While there are obstacles, there are clear opportunities in modern retailing in India. Insuch a scenario, preparedness of Indian retailers in terms of having appropriate formats,scalable processes, appropriate technology and relevant organization capability would becrucial to success. Now in Chennai all branded items available only because of emerging

market situations and customer-friendly market. 73. 73 And if we talk about favourite brand of Chennai people then on the base of

research findings, we found that- Spykar is most famous between college/school goingyouths. Colorplus is most favourite brand for Professionals. And in childrenssegment, parents prefer traditional outlets mostly. And all other brands are still there inmarket and fighting each other for attracting more and more customer market towardsthem. And this high retailing scenario affects traditional unorganized outlets business tooand now they are also giving a high competition to these organized retailers. So for keep


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their presence with a great margin of profits also, all organized and unorganized retailersare facing a high cut-throat competition with each other. But ultimately these all thingsare going in favour of customers and customer will be benefited at last. HAPPYRETAILING

74. 74 CHAPTER - 9 BIBLIOGRAPHY

75. 75 BIBLIOGRAPHY List of books and articles- I. Retail Management, IIPM Library,II. Retail Management Review, IIPM Library III. Cases of Retail Management, Prentice-Hall Publications. IV. Retailing Environment in India, Tata-McGraw Hill Publications.List of websites articles- www.google.com www.wikipedia.com www.johnplayers.com www.koutonsindia.org www.cottoncounty,com www.customerresearch.com www.researchindia.org www.adidas.com

www.priknit.com www.rbk.com www.lilliput.com www.oxemburg.com www.montecarlo.com www.answers.com www.managementjuice.com

76. 76 www.businesscases.com www.prenticehall.com http://www.indiainbusiness.nic.in/ CHAPTER-10 APPENDICES

77. 77 Appendix-1 Questionnaire for Retailers- As this project study is totally based ondetailed research on topic Merchandise Assortment Planning so here researcher has usedopen ended and free response questions in questionnaire, those areas- 1. Tell mesomething about your outlet and brands you deal? 2. What are your target markets andwhat do you do to address these markets? 3. Before taking decisions about your productvarieties and range (Merchandise Assortment Planning), what factors do you consider? 4.What are the important strategies you are adopt? 5. Is it important to make a priorplanning or strategy for merchandise decisions? And if yes then why? 6. Are you facingany kind of problems or difficulties for these decisions and planning because I think in acity like Chennai, it is not possible to stock extensive variety and neither you can becontent with a limited range .How is this situation addressed? 7. Are all decisions relatedwith your outlets merchandise are independently taken by you or is there any support bybrand owners as well? 8. How often your plans change? 9. Do you like to give any otherspecific inputs or details, that arent covered in this questionnaire/interaction? If so,

please do specify. 78. 78 Appendix-2 Questionnaire for Customers- 1. From where you prefer to buy your

apparels- a) Any traditional store (unbranded) or b) A branded retail outlet. 2. Whatfactors do you consider before making a purchase decision, most- Please go by priority:a) Price, b) Variety c) Quality d) Fashion/trend 3. Are you satisfied with the services andvarieties of products provided by these apparel outlets?

79. 79 a) Highly Satisfied b) Satisfied c) Neutral d) Dissatisfied e) Highly dissatisfied 4.Which apparel outlet you prefer most for buying clothing? (To college/school going

youths.) Spykar Ven field Adidas Reebok Kenith Parker Colour Plus

Derby

Cotton County

Or any other organized or unorganized retail outlet 5. Whichapparel outlet you prefer most for buying clothing? (To young professionals.) o JohnPlayers

80. 80 o Peter England o Derby o Cotton County o Color plus o Any other organized orunorganized outlet 6. Which apparel outlet you prefer most for buying clothing? (Forchildren apparel purchasing) o Lilliput o Gini & Jony o Any other organized orunorganized outlet 7. Do you think in organized retail store, a customer have lessopportunities for bargain, less number of choices, high prices, less knowledge and what


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other factors influence a customer preference?

. 8. Then what you think is this new retailing scenario good for

India? As in India, literacy rate is so low, people are not so much aware about new retailconcept. So in this time is it has a good future in India or not? 81. 81 o Yes, definitely o No, not at all o Cant say anything now, let see in future. 9. So

do you want to keep your loyalty with your favourite brand or can switch? o Brand loyal,o Nothing like loyalty, just like this brand (on the base of past sales and observation) butcan switch if found any other good option, o Any brand no matter; just it should satisfytheir needs. 10. List out the Top 5 Brands that you prefer with specific Top of Mind

Recall for those preferred brands with reason: Brands Reasons 1.

.. . 2. ... 3. .. . 4.

.. . 5. ...

.. 11. If you have to give marks to your favourite brand from outof 10, then how much will you give? 82. 82 Appendix-3 Assortment Plan For Boys Jeans Style Straight-leg Straight-leg

Straight-leg Loose-fit Loose-fit Retail price 999 1399 1799 1299 1599 (in Rs.) Type ofRegular Stone Tinsel- Broken twill Over dyed Fabric denim washed Lyera based denimdenim Colours Light blue Dark blue Light blue Light blue Blue Black Indigo BlackBlack Black Black Deep blue Figure: Assortment Plan for Boys Jeans at Spykar Source:

Data collected from Spykar team. 83. 83 Thesis Response sheet RESPONSE SHEET-1 1) Name: V.Arun Kumar 2) ID

Number: FW79/01109/MKT 3) The Topic ofthe study: Merchandise Assortment forApparel Outlets and Retail Counters in Chennai to Cater to Customer Preferences. 4)

Questionnaire made to collect Primary Data (in the first or the second response sheet):Collected input to frame the questionnaire. 5) Date when the Guide was consulted:06.06.09 6) The outcome of the discussion: Framing questionnaire Analysis 7) The

Progress of the Thesis: 1st discussion of thesis, started the thesis based on the input givenby External guide Mr. Muralidharan S.S

84. 84 RESPONSE SHEET-2 1) Name: V.Arun Kumar 2) ID Number:FW79/01109/MKT 3) The Topic of the study: Merchandise Assortment for ApparelOutlets and Retail Counters in Chennai to Cater to Customer Preferences. 4)

Questionnaire made to collect Primary Data (in the first or the second response sheet):Please attach the same 5) Date when the Guide was consulted: 15.06.09 6) The outcomeof the discussion: Literature review and data analysis

85. 85 7) The Progress of the Thesis: 2ndst discussion of thesis, a valuable suggestionsand corrections for literature review and data analysis RESPONSE SHEET-3 1) Name:V.Arun Kumar 2) ID Number: FW79/01109/MKT 3) The Topic of the study:Merchandise Assortment for Apparel Outlets and Retail Counters in Chennai to Cater toCustomer Preferences. 4) Questionnaire made to collect Primary Data (in the first or the

second response sheet): Framed the Questionnaires and External guide has approved it. 5)Date when the Guide was consulted: 24.06.09


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86. 86 6) The outcome of the discussion: Analysis Gaining knowledge to developQuestionnaire 7) The Progress of the Thesis: 3rddiscussion of thesis, taking survey.RESPONSE SHEET-4 1) Name: V.Arun Kumar 2) ID Number: FW79/01109/MKT 3)The Topic of the study: Merchandise Assortment for Apparel Outlets and RetailCounters in Chennai to Cater to Customer Preferences. 4) Questionnaire made to collect

Primary Data (in the first or the second response sheet): Tips to conduct interview. Tips to collect secondary data 5) Date when the Guide was consulted: 30.06.09 6) Theoutcome of the discussion: Analysis Getting appointments with managers of apparel

brands and making note of their feedback. 87. 87 7) The Progress of the Thesis: 4th discussion of thesis, conducting Interviews.

RESPONSE SHEET-5 1) Name: V.Arun Kumar 2) ID Number: FW79/01109/MKT 3)The Topic of the study: Merchandise Assortment for Apparel Outlets and Retail

Counters in Chennai to Cater to Customer Preferences. 4) Questionnaire made to collect

Primary Data (in the first or the second response sheet): Please attach the same 5) Datewhen the Guide was consulted: 25.08.09 6) The outcome of the discussion: Findings andRecommendations 7) The Progress of the Thesis: Reviewed by the faculty, added value

to the findings & recommendation and asked to proceed further. RESPONSE SHEET-61) Name: V.Arun Kumar 2) ID Number: FW79/01109/MKT 88. 88 3) The Topic of the study: Merchandise Assortment for Apparel Outlets and

Retail Counters in Chennai to Cater to Customer Preferences. 4) Questionnaire made tocollect Primary Data (in the first or the second response sheet): Please attach the same 5)Date when the Guide was consulted: 30.06.09 6) The outcome of the discussion: Finalreport ready 7) The Progress of the Thesis: Final report checked by the faculty.

Retail IIPM Project

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