Retailing is the combination of activities

involved in selling or renting consumer goods

and services directly to ultimate consumers for
their personal or household use. In addition to
selling, retailing includes diverse activities like
buying, advertising, data processing and
maintaining inventory.
 Evolution of Retailing

India is a nation of shopkeepers and has more

outlets than any other county in world

Retail outlets exist in all shapes and sizes from a

Panwala to Shoppers stop

Organized retailing in India initially began in

south
It took two years of recession for this concept of
shopping to take roots in cities like Mumbai and
Delhi
Growth of Organized Retailing in India

Organized Retailing in India initially began in the south.

In fact in Chennai nearly 20% of food sales now is
accounted for by Supermarkets and an equal share of
consumers durables is sold through specialty chains.
 Four –Gear Path for the organized retail grade-
By KSA Technopak

Gear One –Stage of Infancy- The Super Bazar as

a concept focusing on price control, started during
the inflationary period of the 1960s, that's where it
began. The open layout and self service concept
were new to Indian consumers.
Gear I was driven by Entrepreneurship like
Subhiksha.
The model primarily applies to apparel more than
any other form of retailing like food and grocery. It
is completely driven from the demand side and not
on the supply side.
 Gear –II- Meeting Cutomer Expectation

It is consumer driven, where buyers are exposed to

new retail formats. This is a period of growth. India
is currently in this stage.

Some of the features offered by these new forms

of store are convenient timings, dial an order,
free parking, provision for trial and taste, prices
below MRP, free home delivery etc…
Gear –III –Shift in the power equation between
manufacturers and retailers

The III gear involves efficient Back-End

Management. Retailers exploit economies of scale and
offer the best prices to their customers .
The focus is on customer acquisition and category
management
A distinctive mark of this phase is efficiency:
profitability through heavy investment in the back –end
 Gear –IV- period of consolidation

The organized sector acquires a significant share of

retail pie

It is the beginning of cross border movement

with mergers, acquisitions gaining in
importance .
Eg. Wal Mart …
 Importance of Retailing
For Consumers

•Convenience to customers
•Generates employment
•Opportunities in frontline retailing
•Remove inefficiencies in distribution
•Better range of products
•Better prices for customers
For Economy

•Triggers customers Spends

•Real Estate The Retail Industries real estate
requirement will be huge which will mean
productive use of large lands lying with govt.
agencies like ports, railways etc

•Tourism /Outbound Shopping-like

New York Dubai even India can be developed for
ethnic Indian brands and organized retailing can
help in developing cities as tourist destination
Importance of Retailing

•Higher GDP
•Outsourcing opportunities
•Foreign Direct Investment in retail
Functions of Retail Marketing

Buying
-Buying for a retail organization is a critical
function of merchandising. The process begins
with the preparation of the buying plan ,called
“open to buy” or OTB.
-OTB refers to merchandise budgeted, for which
the stock have not yet been ordered.

-It is also a process of forecasting sales and

purchase.
 An efficient OTB Plan has the following Function:

•Forward sales planning (Sales forecast)

•Forward cover
• Stock required-for current month 1, it is
sum of planned forecast sales of 2,3 &4
•Opening stock
•Intake requirement difference between
opening and required stock
•On Order- Due for delivery
•Open to Receive-deducting stock on
order from intakes requirement
•Closing stock
Retail Selling

The Sales Approach

Service Approach-
Salutation Approach (greetings)
Merchandise Approach
 CRM

Proper Attitude

Making the Sale

A Model for Customer Relationship Marketing
Input Processing -Unit Output
Customer Customer Dev. Customer retention
Need through and referring new
Assessment personalization & customers
customization

Addition of value
High customer
with product &
satisfaction
service Relationship
marketing Increased market
Contact &
share
involvement Commitment
recognition High customer
Intimacy & one to
respect loyalty
one relationship
Reward High customer
Price offers
retention index
Transparency
Information sharing
Life time
Share values
customer
 Transportation

Fundamental Factors:
Cost –It is the payment for movement between two
locations.
Speed – It is the time required to complete a specific
movement. Speed and cost of transportation are related in
two ways:
• Faster service with higher rates
• Faster service means shorter time interval
•Road transport
•Water transport
•Shipping companies
•Air transport
 JIT –Just in time transport
Management

JIT is a method used for managing

inventory level.

Manufacturers in a number employ it to help them

reduce the amount of production supplies that they
keep on hand.
Seven benefits of JIT implementation

•Downtime reduction
•Inventory reduction
•Workspace reduction
•Increased quality
•Increased manpower utilization
•Increase equipment utilization
•Increased inventory turnover
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