TO PREPARE A 3C REPORT ON

BIG BAZAAR

SUBMITTED TO :
SUBMITTED BY:
 DECLARATION

I ____________________ , hereby declare declare that the

3c report of “BIG BAZAAR” ,has been personally done by me under the
guidance of prof_____________________ in partial fulfillment of post
graduation program during academic year. All the data represented in
this report is true and correct to the best of my knowledge and belief.
This work has not been submitted for any other degree exam
elsewhere.

DATE :-
 PREFACE

BIG BAZAAR is a name renowned in Retail. It is now a brand

image in private retail sector.
RETAIL INDUSTRY IN INDIA
India has one of the largest numbers of retail outlets in the world. Of the 12 million retail outlets
present in the country, nearly 5 million sell food and related products. Thought the market has been
dominated by unorganized players, the entry of domestic and international organised players is set to
change the scenario.
Organized retail segment has been growing at a blistering pace, exceeding all previous estimates.
According to a study by Deloitte Haskins and Sells, organised retail has increased its share from 5 per
cent of total retail sales in 2006 to 8 per cent in 2007. The fastest growing segments have been the
wholesale cash and carry stores (150 per cent) followed by supermarkets (100 per cent)
and
hypermarkets (75-80 per cent). Further, it estimates the organised segment to account for 25 per cent of
the total sales by 2011.
India retail industry is the largest industry in India, with an employment of around 8% and contributing
to over 10% of the country's GDP. Retail industry in India is expected to rise 25% yearly being driven
by strong income growth, changing lifestyles, and favourable demographic patterns.
It is expected that by 2016 modern retail industry in India will be worth US$ 175- 200 billion. India
retail industry is one of the fastest growing industries with revenue expected in 2007 to amount US$
320 billion and is increasing at a rate of 5% yearly. A further increase of 7-8% is expected in the
industry of retail in India by growth in consumerism in urban areas, rising incomes, and a steep rise in
rural consumption. It has further been predicted that the retailing industry in India will amount to US$
21.5 billion by 2010 from the current size of US$ 7.5 billion.
Shopping in India has witnessed a revolution with the change in the consumer buying behaviour and
the whole format of shopping also altering. Industry of retail in India which has become modern can be
seen from the fact that there are multi- stored malls, huge shopping centres, and sprawling complexes
which offer food, shopping, and entertainment all under the same roof.
increase the number of their outlets in a city.
India retail industry is progressing well and for this to continue retailers as well as the Indian
government will have to make a combined effort. It is expected that India may have 600 new retail
outlet till 2010.
Retail space
Driven by changing lifestyles, strong income growth and favourable demographic patterns, Indian
retail is expanding at a rapid pace. Mall space, from a meagre one million square feet in 2002, is
expected to touch 40 million square feet by end-2007 and an estimated 60 million square feet by end-
2008, says Jones Lang LaSalle's third annual Retailer Sentiment Survey-Asia.
Alongside, Indian cities are witnessing a paradigm shift from traditional forms of retailing into a
modern organized sector. A report by Images Retail estimates the number of operational malls to more
than double to over 412 with 205 million square feet by 2010 and further 715 malls by 2015, on the
back of major retail developments even in tier II and tier III cities in India.
Challenges facing the Indian Organized Retail sector
The challenges facing the Indian organized retail sector are various and these are stopping the Indian
retail industry from reaching its full potential. The behaviour pattern of the Indian consumer has
undergone a major change. This has happened for the Indian consumer is earning more now, western
influences, women working force is increasing, desire for luxury items and better quality. He now
wants to eat, shop, and get entertained under the same roof. All these have lead the Indian organized
retail sector to give more in order to satisfy the Indian customer.
The biggest challenge facing the Indian organized retail sector is the lack of retail space. With real
estate prices escalating due to increase in demand from the Indian organized retail sector, it is posing a
challenge to its growth. With Indian retailers having to shell out more for retail space it is effecting
there overall profitability in retail.
"COMPANY INTRODUCTION"
Future Group
Future Group is India’s leading business group that caters to the entire Indian consumption space.
Led by
Mr. Kishore Biyani,
the Future Group operates through six verticals: operates through six
verticals: Retail, Capital, Brands, Space, Media and Logistics.
Apart from Pantaloon Retail, the group’s presence in the retail space is complemented by group
companies, Indus League Clothing, which owns leading apparel brands like Indigo Nation, Scullers
and Urban Yoga, and Galaxy Entertainment Limited that operates Bolwing Co, Sports Bar and Brew
Bar ,
The group’s joint venture partners include French retailer ETAM group, US-based stationary products
retailer, Staples and UK-based Lee Cooper. Group Company, Planet Retail, owns and operates the
franchisee of international brands like Marks & Spencer, Next, Debenhams and Guess in India. The
group’s Indian joint venture partners include, Manipal Healthcare, Talwalkar’s, Blue Foods and
Liberty Shoes.
Future Capital Holdings, the group’s financial arm, focuses on asset management and consumer credit.
It manages assets worth over $1 billion that are being invested in developing retail real estate and
consumer-related brands and hotels. The group has launched a consumer credit and financial
supermarket format, Future Money and soon plans to offer insurance products through a joint venture
with Italian insurance major,
Generali.
The group is currently developing over 50 malls and consumption centers across the country and
has formed a joint venture company focusing on mall management with Singapore-based CapitaLand,
one of Asia’s largest property companies Future Group’s vision is to, “deliver Everything, Everywhere,
Every time to Every Indian Consumer in the most profitable manner.” The group considers ‘Indian-
ness’ as a core value and its corporate credo is -
Rewrite rules, Retain values
.
 “Future” – the word which signifies optimism, growth, achievement, strength, beauty, rewards and
perfection. Future encourages us to explore areas yet unexplored, write rules yet unwritten; create new
opportunities and new successes. To strive for a glorious future brings to us our strength, our ability to
learn, unlearn and re-learn our ability to evolve.
The motto of Future Group, to not to wait for the Future to unfold itself but
create future scenarios
in
the
consumer space
and facilitate consumption because consumption is development. Thereby, it will
effect socio-economic development for their customers, employees, shareholders, associates and
partners. Their customers will not just get
what
they
need
, but also get them
where, how
and
when
they need. They are not just posting satisfactory results, they are writing
success stories
.
13

MARKETING

BIG BAZAAR
FOR THE GREAT INDIAN MIDDLE CLASS

It is a unit of Pantaloon Retail (India) Ltd and caters to the Great Indian Middle
Class. It was started as a hypermarket format in Mumbai with approx. 50,000 sqft of
space. Its values and missions are to be the best in Value Retailing by providing the
cheapest prices and hence goes the tag-line

“Is se sasta aur achcha kahin nahin”

It sells variety of merchandise at affordable rates, the prices of which it claims are
lowest in the city but the level of services offered is also very low. Usually the items
are clubbed together for offers as on the lines of Wal-mart and Carrefour and it also
offers weekend discounts. It currently operates out of 64 stores and top 15 stores
register a cumulative footfall of 27 lakh a month on an average.
The following graph shows the retail life cycle and we can say that Big Bazaar is
currently at the Growth Stage.

Time
Introducti
Grow
Maturi
Declin
Cash
on
th
ty
e
flow
Flows

POSITIONING STRATEGY
 BIG BAZAAR vs. KIRANA STORES

Both the retail formats can be studied on the basis of the marketing techniques that
are used to attract customers. But first we will compare their standing in the
industry using Porter’s 5 Forces model.

BIG BAZAAR AND 5 FORCES:

 RIVAL THREAT OF THREAT OF POWER POWER OF
INTENSITY ENTRANTS SUBSTITUTES OF SUPPLIERS
BUYERS

HIGH HIGH LOW HIGH LOW

We can get an idea about how competitive this retail sector is, by looking at the
degree of 5 forces. Threat of substitute is minimal and supplier bargaining power is
also less, but the rest of the forces are deciding factor in the company’s marketing
strategy. They being ‘high’, means degree of competitiveness is also high. Big
Bazaar is involved in bulk purchases so bargaining power of suppliers is low. The
retail chain will not accept very low margins.

KIRANA SHOPS AND 5 FORCES:

RIVAL THREAT OF THREAT OF POWER POWER OF

INTENSITY ENTRANTS SUBSTITUTES OF SUPPLIERS
BUYERS

HIGH HIGH HIGH HIGH HIGH

The intensity of each and every force of Porter’s model is ‘high.’ This means that the
shop owner is struggling with very less control over his own operations and his
strategies are affected by external factors. Again the competitiveness in this market is
very high and market share for each shop is low due to high number of stores. This
gives more bargaining power to both buyers and suppliers. It is a very easy market to
enter, therefore threats of entrants is high too.
4Ps OF MARKETING

Marketing mix is a deciding factor in formulating marketing techniques for the success
of a particular brand, commodity or company. The components of marketing mix are:

• Product
• Price
• Promotion
• Place
The survey which was conducted gives the effect of each and every component of the
4Ps on the consumer’s mind. These components have a huge bearing on the retail
battle between Big Bazaar and Kirana stores.

PRODUCT:

Big Bazaar

Big Bazaar offers the maximum variety for each category of product and this is cited
by the customers as one of the main reasons why they like shopping at the
hypermarket. The product is the same in every store in the city but the brand options
are more in Big Bazaar. Also, the quantity for each product is not limited to large
packs only. Observations also revealed that local brands of popular commodities, like
diapers, sugar, wheat flour garments etc, are very popular in Big Bazaar stores. These
products are never advertised but offer huge margin on sales. In this way lower middle
class customers are targeted well. The commodities sold by the retail chain also
includes its “own products” which get a ready distribution network. The own products
of Big Bazaar include My World fashion magazine which is not available anywhere
else. So costs are low for such products.
Kirana stores

Products at kirana stores are limited. Actually they have very less shelf space. The
store owner does not have many options regarding the range of products that can be
sold because area of the shop is also not very large. There is not much variety in each
product i.e. the brand choice available to customers is low. Kirana stores usually avoid
keeping expensive products which cost more than Rs. 200 and they limit themselves
to cheaper and daily use items.

Conclusion:

➢ Big Bazaar scores high on the product part of marketing mix.

➢ Customer has more choices of brand in Big Bazaar rather than kirana store.
➢ Customers like touching the product and selecting it themselves before buying.
➢ The customers trust retail chains with quality of the product. They feel food
products of Big Bazaar will have no adulteration. This quality is not assured in a
kirana store.
➢ Cheap and local brands are heavily stocked in Big Bazaar which make it easier
to attract lower-middle class category of customers.

PRICE:

Big Bazaar

Price is the critical point in a competitive industry. Big Bazaar works on a low cost
model. It considers its discounted price as its USP. There is an average discount of 7-
8% on all items in respect to their MRP. Prices of products are low because it is able to
secure stock directly from the manufacturer. There are huge synergies in terms of bulk
purchasing, central warehousing and transportation. These all factors help the retailer
to keep low prices. Survey indicated that low prices were the biggest factor in
customers’ mind while coming to Big Bazaar. It has never focused on giving great
services, but laid emphasis only on low prices to attract crowd.

Kirana stores

Price is a very biased issue in a kirana store. Interview with some store owners
revealed that general policy regarding prices in a store is to give ready discount to its
regular customers but to charge the MRP from new customers. Departmental stores
generally work on tight margins of 6-7%. Change in prices is directly passed on to the
customers.

Conclusion:

➢ Almost everything has some kind of discount in Big Bazaar.

➢ It clubs small quantities to make bigger packs and then lower prices which
kirana stores are unable to do.
➢ It considers price to be the biggest attraction for all customers.
➢ Consumers accept the fact that they come from faraway places because it is
cheap in Big Bazaar for bulk shopping.
➢ It is not possible for kirana stores to give hefty discounts on all items.
➢ Customers feel same price for all customers as a plus point of Big Bazaar as
compared to differential price policy of kirana stores.
➢ Some customers feel cash discount is fine but bulk offer deals are of no use
because you end up getting more than you want which is a waste.

PROMOTION:

Big Bazaar

Big Bazaar has huge promotion budgets. The biggest idea behind all advertisements is
to make people do bulk shopping. After talking to the store manager I found out that
there are 2 types of promotional strategies. One is the holistic advertisement which
promotes the brand and creates awareness among people. It is not targeted at
promoting each store but only creates an image of Big Bazaar as low-cost shopping
option. The store has advertised through TV, road shows and also started reality show-
typed promotional campaign “The Big Bazaar Challenge.” Promotions like “Sabse
Sasta Din” are a very successful strategy to get footfall.

Other type of promotion is the particular store oriented promotion which includes
speaking on the loudspeaker in nearby blocks. Leaflets are given in local newspaper.
There are promotional efforts even inside the store. During the survey, it was noticed
that Buy 2 Get 1 Free type of promotions are very common. Original prices are cut
down and new prices are shown, of which customer takes quick notice. There are
loyalty schemes which reward regular clients. Promotion is also done through co-
branded credit cards with ICICI bank.
Kirana Stores

Kirana stores are involved in almost negligible promotion activity. They rely mainly on
advertisement from the manufacturer of goods to pull in customers. They promote
certain brands by putting names on shelves etc but they do not advertise themselves
as preferred store for local people. One reason can be they work on tight budgets
which have no scope for advertisements. Leaflet promotion maybe done once while
inaugurating new store, but not during the course of existence.

Conclusion:

➢ Retail chain Big Bazaar cannot survive without promotions on national or

regional level.
➢ A big ad budget helps it to get large scale of operations.
➢ Customers accept the fact that advertisement campaign of Big Bazaar did
influence them in their buying behavior.
➢ Its Buy 2 Get 1 Free strategy influences the customer mindset a lot once they
enter the store.
➢ Customers feel loyalty card schemes make them come again and again to the
store.
➢ Promotion of kirana store is a rare event.

PLACE:

Big Bazaar

Place means the location of the business. Big Bazaar has always worked on low-cost
locations. It targets semi-urban population with its placement. Its strategy is to find a
cheap location and it never goes for hot spots in the city. The talk with the manager
revealed that the Teghoria store was opened when it was scarcely populated. Even in
Gurgaon, Big Bazaar chose Sahara Mall instead of Metropolitan or City Centre, which
are more popular than Sahara Mall. It relied on promotional activities to make up for
unattractive locations. The channel of place is company owned stores to have
complete control. Another strategy used by Big Bazaar to overcome location
disadvantage is use of internet. It has launched a merchandise retailing website
www.futurebazaar.com which targets high-end customers ready to use credit cards.
Therefore Big Bazaar has made headway into a potentially high-yielding sector of
online trade. Internet as place has put them in a profitable position because there is
minimal expense of maintaining a website. The promotion of this website is done
through advertisement on Google. The website is put as sponsored link.
Kirana Stores

Kirana stores are always placed in crowded market area which is located in each block
and sector. On talking to the owners, it was found that some stores were inherited by
them from their father, so they had no choice of location. Otherwise it is common
practice to find busy street corners to get maximum customers. Location is important
because buying decision is on impetus during day-to-day life. So the customer goes on
for the nearest store. The store owners are ready to pay more rent for better locations
because their promotion activity is negligible.

Conclusion:

➢ Location is something which is permanent. So cautious decisions are taken

while selecting place.
➢ Big Bazaar refrains from high-end locations for its business.
➢ Some customers travel from far places to the store. So place factor has less
influence on them.
➢ Semi-urban customers still prefer kirana shops, so location of retail chain should
be near to them because they will not travel too far.
➢ Kirana shops make sure availability of goods nearest to the residential area.

HUMAN RESOURSE

The HR department of Big Bazaar is very dynamic. Employees are

the biggest strength and asset of any organization and the HR dept
realises this very well.

This is very evident from the way the HR department handles all
its employees. They take utmost care to select, train, motivate and retain
all the employees. They have continuous developmental programmes
for all the employees. Currently Big Bazaar Banashankri is employing
220 full time and 60 part time employees. There are two shifts for the
employees. The first shift employees arrive at 10AM in the morning
and leave at 7.30 in the evening, while the second shift employees
report at 12.30 in the afternoon and leave at the time of Store closing
(10pm).

For any hr activity one of the major activity is recruitment of the

employee. the following are the main sources through which big bazaar
recruit it employees.

Sources of Recruitment

a) Consultancy Services: For top level management,

employees are recruited through private consultants. They are usually
appointed as Departmental Managers.

b) Walk-ins: This is the main source through which Big Bazaar recruits
its employees. People seeking job usually themselves approach the HR
department for job vacancy. Employees usually selected from this
source are appointed at the entry level as team members.

c) Employee Referrals: This is the other main source through which

employees are selected. Candidates who have given their previous
employer as referrals are first interviewed and from their previous
employer, opinion is taken about their behaviour and performance in
the job. If they receive a positive opinion from their previous employer
they are selected .

d) Campus Recruitment: Young people bring new ideas and fresh

enthusiasm. Therefore Big Bazaar visits some of the reputed
educational institutions to hire some of the most talented and
promising students as its employees. Selection Procedure The following
is the selection procedure that the HR department practices to hire its
employees.

i) Interview: For entry level jobs, the candidates are interviewed by a

HR person. They are asked a few basis questions about their
education, previous work experience if any, languages known etc.
This is done to evaluate the candidate’s ability to communicate freely
and also other skills.

ii) Psychometric Tests: For higher and top level jobs, candidates are
asked to answer a few questions which basically test their sharpness,
analytical ability, ability to handle stress, presence of mind etc. This
is done as Managers are required to work under stress all the time
and still maintain a cool head to make some vital decisions.

iii) Group Discussion: In campus recruitment students are involved in

a Group Discussion, where they will be given a topic on which the
group has to deliberate, discuss and arrive at a solution or a decision
which is accepted by the whole group.Along with the G D they are also
given a written aptitude test.

Finally a formal interview will be conducted to assess the overall skills

of the student.

Induction
New employees selected will be given a 13 day induction
and training program. They will be given information about the
company’s business, different departments etc. They will be
informed of their roles, duties and responsibilities. They will also be
informed about the HR policies and rules of the company.

The new employees will be on probation for a period of 6

months. After this period the HR period along with the department
manager will review the performance of the employee. If the employee’s
performance is good and encouraging, the employee’s services will be
confirmed.

Compensation & Rewards

The employees are rewarded suitably with attractive pay packages.

The salary of an employee includes basic pay. HRA, special

allowance, PF,ESI, Mediclaim etc.

Annual bonus will be given at the time of Diwali.

The employees and their dependents are also entitled for medical
treatment in recognised hospitals with cashless hospitalisation with
whom the company has tie-ups.
If a hospital is not recognised, the amount spent by the employee will be
reimbursed.

Along with these all the employees are given a card known as
‘Employee Discount card’ (EDC) through which they can buy any
product at Big Bazaar at a special discount of 20-30 %.

Leaves and other rules

An employee during his probationary period is entitled for 7 days of
leave. A confirmed employee is entitled for 30 days of leave in a year.
There is only one type of leave the employees can take which is known
as All Purpose Leave (APL).

All the employees will be given identity cards which they have to wear
and also swipe while at the time of entering and leaving the Store.

Performance Appraisal
The HR department conducts performance appraisal of all the
employees annually in the month of April.
Based on their performance increments will be given in their pay. In
addition to this if an employee achieves or exceeds the target given to
along with their team members will be provided with attractive cash and
other incentives.

Training & Development

Future group has its own training division for all its employees, known
as ‘Future Learning & Development Limited’ (FLDL). All the
employees are given training for 20 days in a year spread over different
periods.

‘Gurukul’ which is a part of FLDL gives training to all the employees

on various skills like team work, dedication discipline improving
customer service etc to make them more knowledgeable and productive.

Retention Strategy

We strive to foster a feeling of well-being in our

employees through care and respect, we have several
structured processes including employee mentoring and
grievance management programmes which are intended
to facilitate a friendly and cohesive organisation culture.
Off-site activities are encouraged to improve inter-
personal relationship. We also acknowledge the efforts
exerted by our employees by organisation an annual
celebration called ‘Pantaloon Day’ where we recognize
employees who have shown exceptional talent, sincerity
and dedication. We have implemented an employee
suggesstion programme called ‘Prerna’ wherein the
employee can give their suggestions. Every quarter the
best suggesstion received per zone per format is awarded
prize called “Golden Cap”.

Internal controls and Risk Management

The company uses the services of Ernst & Young for

process audit and risk management and the scope of
their work covers all the company’s formats i.e.
Pantaloons, Big Bazaar, Food Bazaar and Factory
Outlet.
The objectives are to:

• Gain an understanding of the various Business

Processes
• Identify the strengths and weaknesses in the existing
systems and procedures.
• Review use of technology in the function
• Identify key business process risks and review the
adequacy of the controls and mitigate them.

• Test the effectiveness of controls the most significant

risks and provide recommendations to improve
controls.

• Identify potential areas for improving process efficiency

• Broadly develop on improvement portfolio and raise the

level of awareness of how business is impacted by
inadequately controlled risks inherent in the business
process.

Internal audit of our each store is also undertaken by

an independent audit firm on monthly/quarterly basis.

Measurement of Customer
Satisfaction
We have devised a model called CEM- Customer Experience
Management Model to measure customer satisfaction in our stores. The
Customer Experience Management Model focusses on the customer’s
experience at every touch point in the store ranging from their first
impression of the store, to their experience at the trial rooms, toilets,
with our staff through various processes such as billing and exchanges.
We have hired a research agency called MACRO-Market Analysis and
Consumer Research

Organisation. This agency sends people who are called ‘Mystery

Shoppers’ to visit the stores and then their experience is documented on
a feedback form, which is then sent to us. Based on the feedback formed
analysis is done and the stores are given scores. This allows us to track
performance on customer expectation at overall, format and store levels,
determine critical improvement areas are all levels and also identify
opportunities that we can leverage upon.

Besides, we have also started an in-house initiative called ‘Pragati’

whereby one person from the head office operations team visits the
stores and observes the stores with respect to certain pre-parameters like
store exteriors, baggage window, customer service, store ambience etc.
This activity is done on a quarterly basis and three best stores under each
format are announced. This encourages the stores to improve the
efficiency of their store operations.

SWOT Analysis
Strengths

• Better understanding of customers helping the company to serve

them better.
• Vast range of products under one roof helping in attracting
customer and their family to shop together and enjoy the
experience.
• Benefit of early entry into the retail industry.
• Diversified business operating all over India in various retail
formats.
• Ability to get products from customers at discounted price due to
the scale of business.

Weaknesses

• High cost of operation due to large fixed costs.

• Very thin margin.
• High attrition rate of employees.
Opportunities

• Lot of potential in the rural market.

• Can enter into production of various products due to its in depth
understanding of customers’ tastes and preferences.
• Can expand the business in smaller cities as there is a lot of
opportunity.

Threats

• High business risk involved.

• Lot of competitors coming up to tap the market potential.
• Margin of business reducing all the time.
 CONCLUSION
Big Bazaar is undoubtedly the number one retailer in India. It
has built a very emotional and cordial relationship with its customers. It
is also very intending to build long-term relationship with all its
stakeholders, which is very essential for a successful business venture. It
is observed that the organisation hierarchy is professional as all the
departmental Managers directly report to the Store Manager who in turn
reports to the Zonal Head. Big Bazaar, with 25 years of experience in the
field of weaving fabrics, is the leading Apparels and fashion design
Fabric Company.

There exist a healthy and positive relationship between employees and

managers.The employees accept their responsibilities wholeheartedly,
accept that it is their responsibility to carry out a part of the
activities of the company and they will be held accountable for the
quality of their work. It is found that more than 60% of employees are
of the age group of 20-35. From this it reveals that company is
having young and energetic workforce who are very creative,
enthusiastic and also very determined to grow in their career and in turn
helping the company to grow. Working environment is good and also
the various facilities provided helps in motivating the employees. The
company is reaching out to all the sections of the society as it is
creating a hypermarket where not only the rich people shop but also the
middle and the lower class customers come to enjoy the whole shopping
experience.