UNIT-1

What is Retail?
Retail involves the sale of goods from a single point (malls, markets, department stores etc) directly to the consumer in small quantities for his end use. In a layman’s language, retailing is nothing but transaction of goods between the seller and the end user as a single unit (piece) or in small quantities to satisfy the needs of the individual and for his direct consumption. The word retail has its origin in French word retaillier and means “to cut a piece’’ or “to break bulk’. “Retailing is the sale of goods and services to the ultimate consumer for personal, family or household use.” According to Kotler: “Retailing includes all the activities involved in selling goods or services to the final consumers for personal, non business use” Retailing may be understood as the final step in the distribution of merchandise for consumption by the end consumers. Retailing is responsible for matching final consumer demand with supplies of different marketers. Retailing is high intensity competition industry, the reasons for its popularity lie in its ability to provide easier access to variety of products, freedom of choice and many services to consumers.

Structure of Indian Retail

Traditional Formats Itinerant Salesman Haats Melas Mandis etc.

Established formats
Kirana shops Convenience/ department stores PDS/ fair price shops Pan/ Beedi shops

Emerging Formats
Exclusive retail outlets Hypermarket Internal retail Malls / Specialty Malls Multiplexes Fast food outlets Service galleries

 Raymond’s distribution network today comprises 20.  The PDS (Public Distribution System) would easily as the single largest retail chain existing in the country.000 retailers and over 256 exclusive showrooms in over 120 cities of the country Major Retailers in India Pantaloon  With more than 450 stores across the country  Launched country's first hypermarket ‘Big Bazaar’ Tata Group  A major player with its subsidiary Trent.s to the 80.The Evolution of Retail in India  Retail in India has evolved to support the unique needs of our country. Mandis and Melas have always been a part of the Indian landscape.  There was rapid increase in the ration shops ( being increasingly called the Fair Price Shop or FPSs)  The Canteen Stores Department and the Post Offices in India are also among the largest network of outlets in the country reaching population across the country. it also acquired the largest book and music retailer in India ‘Landmark’ in 2005. They still continue to be present in most parts of the country and form an essential part of life and trade in Various areas.s. given its size and complexity Haats.  The first attempts at organized retailing were noticed in the textiles sector.  In the past decade. One of the pioneers in this field was Raymond’s which set up stores to retail fabric. the Indian marketplace has transformed dramatically. . the evolution of the PDS of Grains in India has its origin in the “rationing system” introduced by the British during world war II  The system was started in 1939 in Bombay and subsequently extended to other cities and towns. investment in various industries was limited due to low purchasing power in the hands of the consumer and the government’s policies favoring the small scale sector. which operates Westside and Star Bazaar. the system was abolished post war but however attaining independence India was forced to reintroduce it in 1950. However from the 1950.  Established in 1998.

Allen Solly.  Opened the pharmacy and beauty care outlets ‘Health & Glow’. Reliance  More than 300 Reliance Fresh stores and Reliance Mart It's expecting its sales to reach Rs. This comes four different perspectives 1. the retailer serves him by providing the goods that he needs in the required assortment. but rather offers finished goods and services in a form that the customers want. he creates place utility.RPG Group  One of the earlier entrants in the Indian retail market. The retailer performs the function of sorting the goods and providing us with an assortment of product in various categories. Apart from these functions retailer also performs like: . Peter England Functions of a retailer  From the customer point of view. when the product is sold.000 crores by 2011. Form: First is utility regarding the form of a product that is acceptable to the customer. Birla Group  Strong presence in Indian apparel retailing.    Preferable shopping hours. 2. at the required place and time. ownership utility is created. The brands like Louis Phillipe. Place: By being available at a convenient location.  From an economic standpoint.   The retailer does not supply raw material. the role of a retailer is to provide real added value or utility to the customer. Time: He creates Time utility by keeping the store open when the consumers prefer to shop. food & grocery retailing in 1996 with its retail Foodworld stores. 90. Ownership: Finally. Van Heusen.

advertising.1. The discount stores generally offer a limited range and the quality in certain cases might be a little inferior as compared to the department stores. In India Vishal Mega Mart comes under discount store. properly placed and arranged in specific departments is called a supermarket. Merchandise: Electronic Appliances Apparels Jewellery Toiletries Cosmetics Footwear Sportswear Toys Books CDs. Arranging Assortment: manufacturers usually make one or a variety of products and would like to sell their entire inventory to few buyers to reduce costs. storage. In a department store. manufacturer and wholesalers typically ship large cartons of the products. and pre. DVDs Examples . the consumers can get almost all the products they aspire to shop at one place only. Department stores provide a wide range of options to the consumers and thus fulfill all their shopping needs. It helps to keep prices stable and enables the manufacture to regulate production. Pantaloon Discount Stores Discount stores also offer a huge range of products to the end-users but at a discounted rate. Breaking Bulk: to reduce transportation costs. by collecting an assortment of goods from different sources. A supermarket is an advanced form of the small grocery stores and caters to the household needs of the consumer. Different formats Department Stores A department store is a set-up which offers wide range of products to the end-users under one roof. Supermarket A retail store which generally sells food products and household items.payment of merchandise. Retailers are able to balance the demands of both sides. Final consumers in contrast prefer a large variety of goods and services to choose from and usually buy them in small units. Merchandise: Almost same as department store but at a cheaper price.Shoppers Stop. Wal-Mart currently operates more than 1300 discount stores in United States. which are then tailored by the retailers into smaller quantities to meet individual consumption needs 3. buying them in sufficiently large quantities and selling them to consumers in small units 2. 4. The various food . Holding stock: Retailers maintain an inventory that allows for instant availability of the product to the consumers. Promotional support: small manufacturers can use retailers to provide assistance with transport.

Malls Many retail stores operating at one place form a mall. vegetables.EBAY. Merchandise: Bakery products Cereals Meat Products. Specialty store would specialize in a particular product and would not sell anything else apart from the specific range. Merchandise: Eggs Bread Stationery Toys Cigarettes Cereals Pulses Medicines Specialty Stores As the name suggests. juices etc) are all properly displayed at their respective departments to catch the attention of the customers and for them to pick any merchandise depending on their choice and need. pay with the help of debit or credit cards and the products are delivered at their homes only. However. Example .products (meat. Warehouse stores do not bother much about the interiors of the store and the products are not properly displayed. E.Tailers Now a days the customers have the option of shopping while sitting at their homes. The size of the store would not be very big and depends on the land available to the owner. Amazon Dollar Stores Dollar stores offer selected products at extremely low rates but here the prices are fixed. Example -You will find only Reebok merchandise at Reebok store and nothing else. thus making it a specialty store. In this kind of shopping. A mall would consist of several retail outlets each selling their own merchandise but at a common platform. You can never find Adidas shoes at a Reebok outlet. They offer selected items and are not at all organized. Rediff Shopping. Mom and Pop Store (also called Kirana Store in India) Mom and Pop stores are the small stores run by individuals in the nearby locality to cater to daily needs of the consumers staying in the vicinity. They wouldn’t offer high-end products. Specialty stores sell only selective items of one particular brand to the consumers and primarily focus on high customer satisfaction. Fish products Breads Medicines Vegetables Fruits Soft drinks Frozen Food Canned Juices Warehouse Stores A retail format which sells limited stock in bulk at a discounted rate is called as warehouse store. . there are chances that the products ordered might not reach in the same condition as they were ordered. dairy products. the transportation charges are borne by the consumer itself. This kind of shopping is convenient for those who have a hectic schedule and are reluctant to go to retail outlets. They can place their order through internet.

Approaches to pricing model are based on market. Every retailer seeks to find a unique combination of these factors that put them in the target market. Product in the retail mix considers classification and brands . Product: Identifying. quality. space and opening hours to achieve the objective. what is required to present the product to the customer etc… Place: Correct channels for reaching the customers e.Example . it brings profits. anticipating and satisfying customer needs & desires. EDFP (everyday fair pricing) or Hi-Lo pricing and these strategies are influenced by what competition charges. what customers are ready to pay. competition. No further bargaining is entertained. Retailers need to ensure that their products and services are focused to meet the customer’s expectations. branding. labels. Retailing mix Retail strategies are combination of one or more of the 6 P’s of Retail referred as "Retailing Mix".99 Store would offer all its merchandise at Rs 99 only.price points. However the quality of the product is always in doubt at the discount stores.g. sites. Price: Price is important element of the retail mix. Some common strategies are EDLP (everyday low pricing). . locations. margins and brands.

support or communication. These are people that are differentiators as compared with the competition whether it is pre-sales. Personnel: It is the people working for you determine the level of service or value you provide to customer. personal selling. communication are few elements that encapsulate promotion aspect. delivery vans. Presentation of the stores. Be is selling function. public relations. Presentation: It is the physical evidence that portrays the image of the business and key drivers.Promotion: Publicity. advertising. premises. It very important to ensure that the image portrayed is consistent with the product and services being offered. websites. direct marketing. sales or post-sales activities. uniforms etc plays crucial role in associating customer with your brand. . service. warehouses. offices.

Sign up to vote on this title
UsefulNot useful