SUMMER INTERNSHIP PROJECT WORK ON

MERCHANDISING IN TRADITIONAL RETAIL

Project Report

Submitted in partial fulfillment of the requirements for

Master of Business Administration (MBA)

BY

Arjinderbir Singh

1631003

CKD INSTITUTE OF MANAGEMENT & TECHNOLOGY

G.T. ROAD, AMRITSAR

JULY 2017

2016-2017

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 DECLARATION

I, Arjinderbir Singh Student of Chief Khalsa Diwan Institute of Management

and Technology, hereby declare that I have completed the project titled
MERCHANDISING IN TRADITIONAL RETAIL during the academic year
2015-17.

The report work is original and the information/data and the references included
in the report are true to the best of my knowledge. Due credit is extended on the
work of Literature/Secondary Survey by endorsing it in the Bibliography as per
the prescribed format.

Arjinderbir Singh

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 ACKNOWLEDGEMENT

A summer project is a golden opportunity for learning and self development. I

consider myself very lucky and honored to have so many wonderful people lead
me through in completion of this project.

My grateful thanks to Mr.Nishchay Mahal, marketing head who in spite of being

extraordinarily busy with his duties, took time out to hear, guide and keep me on
the correct path. I do not know where I would have been without him.

A humble thanks to Prof. Hansdeep whose patience I have probably tested to the
limit. She was always so involved in the entire process, shared her knowledge, and
encouraged me to think. Thank you, Dear Madam. I would like to thank Dr.
Ramchandran (Director, PTVAS IM) for his efforts and help provided to me to
get such an excellent opportunity.

Last but not the least there were so many who shared valuable information that
helped in the successful completion of this project thanks to all those.

Student Name Signature

Date

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 TABLE OF CONTENTS

Sr. No Particulars Page no.

1 Introduction to Merchandising 5
2 Executive Summery 9
3 Beverage Industry Overview 10
4 Company Profile 13
5 Literature Review on Blue 16
6 Objectives and Need For The Study 18
7 Research Methodology 19
8 Findings, Analysis and Interpretation 21
9 Recommendation 35
10 Limitations of The Project 37
11 Conclusion 38
12 Bibliography & Websites 40

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 1. INTRODUCTION TO MERCHANDISING
The process of merchandising is getting the right goods in the right sizes, shapes and colors at
the right price; at the right location; for the right consumers. In addition, the right time and
the right quantity of merchandise must be right for the retailer and for the consumer. To
succeed in satisfying the needs and wants of the right consumer, the activities in the
merchandising function must be conducted with one part knowledge, one part experience, one
part hard work, and even, one part good luck!

The right goods means the right merchandise for both consumer and retailers. For example, the
right merchandise identified by a merchandise manager for one retailer might not be the right
merchandise for another retailer in the same retail classification. For some retailers, the right
merchandise may be seasonal merchandise such as heavy wool coats and gloves due to the
specific geographic location. Meanwhile, for other retailers, basic trench coats and raincoats may
sell in the store year-round. The quality of the merchandise may be another important feature for
some retailers. Their target consumers may have specific expectations about workmanship,
functional performance, and design aesthetics as related to the price for a valuable product.

Several factors, external and internal, can impact the ability of the retailer to obtain the
merchandise at the right price. Pricing is a major factor in merchandising. Market trends, current
domestic and global economic conditions, pricing and product offerings by the competition, and
other external factors may influence the pricing of the merchandise assortment. Within the retail
environment, last years sales volume and markdown patterns can also affect potential pricing for
this year.

To achieve the right location for the merchandise, the retail merchandiser must carefully
organize the space within the store, in the catalog, or on the Web site for the right merchandise
presentation. This right is important for the retailer to achieve the ultimate sales potential for the
available space, be it real or virtual. Proper visual presentation as well as the combination of
specific merchandise classifications must create an inviting retail environment for maximum
sales potential. Artistic displays, appropriate usage of proper signage, and organization and
presentation of merchandise in print advertising, catalogs, and Web sites must be considered to

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develop the right location or place for each item and combination of items. The front of the store
or the home page on a Web site is prime selling space. The location of floor space relative to
store entrances and traffic paths, the buttons and links within a Web site, and the positioning of
merchandise in a catalog are important considerations that are critical to the right place or
location for specific types of merchandise. Retailers can track sales of merchandise and note
locations to determine the right placement of the goods.

The right time of merchandise delivery is another important factor in all aspects and activities of
the merchandising function. If goods, especially seasonal or fashion apparel products, arrive in
the store too early, the retailer may be forced to house high inventory levels due to a lack of sales
and low movement of stock. Keeping high inventory levels can create larger markdowns than
anticipated and can reduce cash flow. On the other hand, if goods are received later than needed,
a loss of sales resulting from consumer disappointment from low levels of stock, lack of desired
merchandise, or unappealing merchandise assortments can occur. Late deliveries due to improper
shipping may create unbalanced assortments and cause unexpected markdowns, low or no
profits, and leftover and unwanted inventory.

The right quantity of merchandise is also important for the retailer and the consumer. The
retailer must achieve a balance between the amount of inventory on hand at the beginning of a
sales period and the amount of sales realized during that same period. In other words, the right
quantities of specific merchandise assortments and classifications are necessary in meeting sales
quotas for a specific period. These quantities are usually planned from the units and dollar
volumes from the same season of the previous year with adjustments made for the new year. If a
retailer orders too few goods, a loss of sales from lack of inventory may result. If the same
retailer orders too much stock relative to consumer demands, excess and unsold inventories can
lead to unplanned markdowns that reduce profit margins.

The actual sale of the merchandise is the final activity in this step. Managing both sales
associates and the products is vital to the successful sale in order for the retailer to obtain the
double goal of customer satisfaction and profit. Personal selling is important both for stores.
Many catalog retailers have highly trained sales associates to help consumers with their
telephoned purchases. Service after the sale is also an important aspect of promoting the
merchandise and making the sale. Retailers must ensure that the products they sell will fulfill the

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promise of the promotion and will continue to satisfy the customer. Customer satisfaction may
be enhanced through a partnership with the vendors. Vendors can supply information cards and
toll-free phone numbers so that consumers can call directly to the source of the product for
information and assistance with complaints.

Including all the above processes merchandising can also be said as a part of promotions where
companies use N number of different tools for merchandising, like Decathlon use their in-store
signages and purchase of hire a strategic place to store their merchandise that may be in or
outside the chiller so these are some of the examples of merchandising tools.

Visual Merchandising

The Basics

The basic principles of visual merchandising include stocking and front-facing. When a product
or item is missing from store shelves, sales will suffer. Thats why its essential to regularly
stock items throughout the day to ensure a shelf space full of live inventory. Front-facing
inventory with labels facing out gives the store a neat appearance and facilitates an easier
shopping experience for the customer.

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Promotional Displays

Stores should pay special attention to in-store displays and focus on promoting items that are in-
stock. Visual merchandising an end cap or window display with the most current inventory will
positively impact sales for that SKU. When inventory levels are low or if the product is sold out,
its essential to replace in-store displays with available inventory to make the most of selling
through in-stock merchandise.

Seasonal Changes

Stores need to appear full of fresh inventory on a regular basis to make the most of its retail
sales. Visually merchandising the most current items at the front of the store looks inviting and
new, especially for your regular customer and can positively impact sales. If your store has few
seasonal changes in inventory, you can create the illusion of new stock by rotating which
inventory is showcased at the front of the store.

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 2. EXECUTIVE SUMMARY
This project is based on understanding the concept of merchandising and its impact. Almost all
the Decathlon stores use same tools of merchandising depending upon their objectives and
budget.

Narang Danone Access (NDA) is a joint venture for Narang group and Danone, Danone which
is a company form France. NDA uses many merchandising tools to promote Blue. Blue is a non-
carbonated flavored soft drink. People in India hardly know about non-carbonated flavored soft
drink, so it was very important for the company to educate the market.

To spread the awareness NDA used merchandises which are paid and which are unpaid and also
which are inside the outlet and outside the outlet.

The main objective of this research was to identify the impact of all the tools and among them
which is the most impactful tool and how easily it can be installed. Knowing the durability of
each tool is also important because the tool which has great impact on customers but doesnt
have durability is of no use.

This project is based on a quantitative research where questionnaire was prepared for both
customers as well as retailers. 550 customers and 100 retailers were intervened from different
areas of Mumbai i.e. Bandra, Khar, Walkeshwar, Marinlines etc.

Based on the responses by the customers and retailers conclusion are drawn. All the data which
was collected and the conclusions were drawn is explained in detail in the further part of the
project.

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 3. BEVERAGE INDUSTRY OVERVIEW
The non-alcoholic drinks market has witnessed rapid growth over the past few years in India.
Increasing middle class population, rapid urbanization and rising disposable income are some of
the major factors fuelling this growth.
The industry is broadly classified into soft drinks (carbonated and non-carbonated drinks) and
hot beverages. The carbonated drinks market is close to Rs 6,000 crore and is growing by 10-12
per cent annually.

The fruit-based beverage market stands at Rs 5,000 crore and is growing at 35-40 per cent an
annually. The fruit-based beverage market is divided into three segments fruit flowered
drinks, nectar .i.e. fizz fruit-drink and 100 per cent juice and is currently dominated by Dabur,
Parle Agro, Pepsi, Coke and HUL.
The Functional drinks segment is dominated by energy drinks. The current market size of energy
drinks in India is around Rs 500 crore and it is expected to grow at a CAGR of 25 per cent.

Within the hot beverages category, India is the largest producer of tea with a total turnover of
around Rs 8,500 crore, growing at a rate of 1-2 per cent annually. India is the worlds fifth
largest producer of coffee, accounting for 4 per cent of the worlds production.

Fruit/vegetable juice segment is expected to grow at a CAGR of 30 per cent in value terms,
followed by the energy drinks segment at a CAGR of around 25 per cent in value terms.

Growth of Indian Beverage Industry in India

The non-alcoholic ready-to-drink beverage segment has
been growing at a compound annual growth rate (CAGR)
of 13 per cent since 2009, and is one of the segments that
have defied the slowing economic growth.

Arvind Varma, secretary general, IBA, said, "The non-

alcoholic ready-to-drink beverage industry is one of the
largest investors in the country and has contributed

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significantly to the growth of industries. This industry is witnessing rapid growth, driven by a
combination of factors such as increased investments and innovations.

However, the government needs to take a long-term view on the industry while formulating
policies or else there is a chance this industrys growth may get derailed, he stated.

IBA aims to act as a catalyst to enable the non-alcoholic beverage industry to play an
increasingly significant role in the growth of the economy, by providing employment
opportunities and driving income growth and therefore has raised its expectations with the
government authorities, Varma added.

IBA's suggestions

At the deliberations in the seminar, speakers observed that the macro-indicators and the
demographic dividends growth for the beverage industry in India.
With an enabling policy, which includes a more rational tax structure, frequent consultations
with the industry on food regulations, giving the industry its due recognition as manufacturers of
high quality, healthy and nutritious products as well as life-critical products like water, will
further help the industry realize its potential, IBA stated.
As an industry that has strong backward linkages with agriculture, its growth will also benefit
millions of farmers across the country.

GST
One of the key areas where the beverage industry expects Central and state government
intervention is goods and service tax (GST) and direct tax code (DTC). The beverage industry
has learnt that a single rate for both Central GST and state GST, which was proposed earlier, is
reportedly being talked about as three different rates. This defies economic logic and is
indicative of difficulty in moving forward the proposal of a Constitutional amendment in
Parliament. IBA also suggested that the beverage industry be made a key stakeholder in the
introduction of GST, and should be a natural partner in the process of consultation while

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formulating the plan and roll-out of GST. The extent of involvement of industry currently in the
consultation process needs to be scaled up and made more relaxing.

VAT
The value-added tax (VAT) rate of six per cent is applicable to fruit juice and fruit juice-based
drinks. Despite the states coming to an understanding that VAT would be charged at the rate of
six per cent on fruit juice and fruit juice-based drinks, some states have increased the VAT
substantially. The move to increase VAT on fruit juice and fruit juice-based drinks will subvert
the growth of the juice industry as also the development of the fruit and vegetable processing
industry.
But some states have also increased the VAT on carbonated soft drinks.
This increase in taxes will, therefore, have to be passed on to the consumer leading to an increase
in the price of the soft drinks, which will restrict purchase of soft drinks by the general mass.
This, in turn, will have an adverse effect on the beverage industry and industries that depend on
the beverage industry. An increase in price also favors manufacturers to sell their products on the
basis of cost arbitrage.

R&D
Industry players also felt that their prowess in research and development would help them move
beyond global brands and develop local, indigenous products to suit regional palates, thereby
driving further growth in the market. These innovations are meant to address the low per-capita
consumption of packaged beverages and will create both a direct and an indirect impact.

Regulatory aspect

The industry also expects that the food safety authorities remove roadblocks and provide much
faster clearances and approvals on ingredients and new products, without compromising the
safety and quality of new products.

This is most relevant in case of proprietary foods, where inordinate delays result in food and
beverage companies having to wait for many months before launching new products.

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 4. Company Profile

NARANG GROUP

At the Narang Group, they are passionate about the work they do and utilize individual ideas,
creativity and innovation to achieve a common goal. They have five key business verticals
Danone Narang Beverages, Narang Danone Access, Suntory Narang, Narang Buzz & Narang
Gourmet.

They are the proud owners of Qua, the No.1 premium natural mineral water in India. The latest
addition under their health & wellness still beverage portfolio is B'LUE, a water-based
restoration drink.

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Danone Narang Beverages and Narang Danone Access are joint ventures with Groupe Danone, a
global leader in healthy food & beverages. With a turnover of Euro 17 billion, Danone ranks
number 1 in fresh dairy and is a leader in baby nutrition and natural mineral water worldwide.

Some of their other partners include some of the world's leading food & beverage brands such as
Evian, Lindt, Illy Caff, Twinings, Perrier and Monster.

Narang Group is known nationwide for their deep understanding of consumer insights, their
abilities to build brands in innovative categories, as well as their localized experience when it
comes to sales, distribution, marketing and logistics.

NG is recognized for their expertise in promoting and nurturing global, premium brands.

They achieve this by raising awareness, identifying opportunities, understanding market needs,
integrating processes and initiating activities to achieve common targets.

NARANG DANONE ACCESS (NDA)

Narang Danone Access handles beverage sales & distribution, leverages top-notch minds and
world-class partners to create the most efficient marketing team in the country. This force of

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productivity loves to take on a challenge, no matter how big or small, and look into every detail
to ensure happy consumers, as well as results that smell of success.

Their strengths and services include:

A pan-India presence in 125 cities, with an automated distribution system covering over
100,000 outlets, serviced by our dedicated field force.
Direct & Indirect Distribution
Channel Management we have dedicated sales teams to handle the different
Complexities of Institutions as well as modern & general retail trade in the country. This
approach also helps them in key account management as well as in synergizing trade
marketing across our portfolio. Their network offers partners VIP entry into key markets
across all regions. They also offer complete automated logistics solutions to help bring
international products into the country with ease. Using a completely holistic approach,
they service all their partners logistics needs.

NDA Specialized Logistics Services include:

Sales Forecasting & Demand Management

Sales & Operation Planning (S&OP)
Production & Material Requirement Planning
Importation with emphasis on Duty Paid & Duty Free Clearance
Warehouse Management
Trucking & Distribution Solutions
Cold Chain Logistics
Premium Food & Beverage Product Handling
Collaborated Planning, Forecasting & Replenishment (CPFR)

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 5. Literature Review on Blue
Blue has been specially designed keeping in mind todays Young India the section of the
Indian society who believe in designing their lives and living their passion.
Danone Narang Beverages, a joint venture between the French Group
Danone and Indian business house Narang Group, announced the national
launch of Blue, a delicious new restoration drink that enlivens you in
body, mind and mood. With the launch, this beverage opens a new
segment in the Indian Ready to drink beverage segment.

Blue has been specially designed keeping in mind todays Young India
the section of the Indian society who believe in designing their lives and
living their passion. The I Generation of doers who live the change that
most of us wish to see! A 24X7 generation who wants to be at their
optimal best, anytime, anywhere. B'lue, with its distinctive taste is what
every Young Indian ultimately aspires to be Inventive, unique and Surprising.

Formulated with unique taste and stimulating aroma, Blue is an ideal drink for generation who
wants to be at their optimal best, anytime, anywhere. Blue helps them to feel at their best in body,
mind and mood so that they are ready for all the opportunities in life. Blue has been introduced in
three delicious fruit flavors of Apple, Peach and Guava and is available in 500ml pet bottle priced
at Rs. 30.

What makes it so awesome!

No Carbonation, so no fizz.
No Caffeine, so its light on you.
No Artificial Colours, so you can see its true colours.
No Preservatives, so its more concerned about your health.

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Talking on the launch, Tarun Arora, Country Head, Danone-Narang Beverages said,As a
pilot, we introduced Blue to the city of Pune and received a tremendous feedback. The beverage
was very well accepted in the market. We then rolled into the soft launch phase in Mumbai, once
again with encouraging results. With the national launch now, we are confident that consumers
across the country will experience the Blue benefit in their very busy daily routine. Blue has a
unique proposition that enlivens ones body, mind and mood, is ideal for this generation who
wants to be at their best hamesha.

We believe consumer knows it best. So we decided to co-create the Blue proposition, including
the brand name, with the Indian youth. And its heartening that the Youth also voted Blue as
Product of the Year, an Innovation award endorsed by consumers, adds Tarun Arora
Youth icon, Vir Das, is the brand ambassador of Blue who truly represents the aspirations of
a young India who believes in living their passion and pursuing their dreams, he added.

Advertising Communication:
The tilt in the ad personifies the down / out of state situation resulting due to triggers that might
affect body, mind or mood or all. In such situations, all one need is a drink that can restore one to
his best. The communication is designed to appeal to the urban youth, projecting into their lives
and their need to be at their best. The ad highlights brand ambassador, Vir Das missing daily
opportunities in love, life and work because he is not at his best. The ad concludes with Vir
sipping Blue to be at his best.

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 6. OBJECTIVES & NEED FOR STUDY

To understand the concept of merchandising

To know the tools used in merchandising especially in traditional retail

To analyze the impact of paid form of merchandising

To know the durability of the unpaid merchandising tools

To compare paid and unpaid merchandising tools and conclude the best amongst them

To know is there a relationship between merchandising and sales?

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 7. Research Methodology
To fulfill the needs defined above and to come to a conclusion a proper research is to be done. I
have implemented a quantitative research technique and in that the survey method.

Survey method gives me proper and complete information. It is always good to go with a survey
method because it includes collecting primary data and is the most relevant one too. Other
methods may need, or are based on secondary data or self experience (e.g. Qualitative Research)
which is nothing but the experience and opinion of one single researcher based on his research.
Which has a chance of differentiation in the opinion of what the customer thinks and what the
researcher concludes? So it is always better to go with a quantitative research technique.

I have made a proper questioner that will give me the primary data and which helps me in
further analysis and come to a conclusion.

550 customers were personally intervened and

100 retailers were personally intervened.

Following are the questions asked for the customers, the main purpose from these questions was
to know from where they came to know about Blue and have they noticed any merchandising
tool at a retail store, their perception about blue or what they think about blue.

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Questionnaire (a) for customers

Questionnaire (b) for retailers

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 8. FINDINGS, ANALYSIS AND
INTERPRETATION
Findings:

Merchandising as a concept in book changes a bit when it comes to implementing. There are
only a few tools mentioned in the books. Whereas companies outside are uses the tools which
cannot be implemented by a small scale companies or business units.

Big Companies like Pepsi, Parle Agro uses different tools like giving a refrigerator to retailers,
placing stickers and giving display boards to retailers were their shops name is printed on it. A
small or a company just started for them giving a refrigerator is not just a challenge but highly
impossible. This gives those big companies a additional advantage over small companies to push
their products.

In the Same way NDA also uses the following merchandising tools in traditional retail:

Danglers

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 Stickers

Posters

Banners

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 Stock Display

Window display

Display in Chiller

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 Counter top

Shop Board

Display on Gate

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Among the above tools some are paid and some are unpaid.

From the above questionnaire (a) it was found that 473 customers (respondents) were male and
remaining among 550 were female.

From the above questionnaire (b) all the retailers responded were traditional retailers which does
not big organized retail stores like D-Mart, Big Bazzar etc.

ANALYSIS OF DATA FOUND AND ITS INTERPRETATION

Recall of the brand Blue:

Company does advertising on various mediums like TV and other mediums. As the company is
also investing time and sources in merchandising it wants to know how many % of people
recollect the Brand Blue by any of the merchandising tools show above.

So, form the survey conducted of 550 respondents in Bandra (E), Walkeshwar, Marinlines, and
Khar (W) the following result was found

Pie-Chart

Chart Title
Shoping Mall Merchandise TV Social Other

5%
10%
37%

25%

23%

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From the above table I can say that among all the mediums used by the company, maximum
number of people recall Blue or they recently saw blue at a Shopping Mall (37%). And this is
because company gave various schemes in shopping malls and people were attracted to those
prices.

MRP of Blue is Rs.30 per bottle for 500 ml in any other retail shops except big organized retail
stores and shopping malls. But in shopping malls people where getting it for only 50 per combo
pack of 3 bottles. This was close to half the price they pay in any other retail shop.

What is of our concern is the third highest, that is 23% or respondents recall the brand Blue form
one of the merchandising tools used by the company which is just less than the TV add on which
company spends some crores in a single year. So it is a great success for merchandising tools.

TV adds and Merchandising are both tools and you can say mediums of advertising one of the
major difference between TV add and Merchandising is? TV ads are active and merchandising
tools are passive. That means TV ads are visual they speak, they sound etc. Where on the other
merchandising tools is just a visual method of advertising.

10% of respondents came to know about Blue from social group i.e. form family members,
relatives and friends etc. And remaining 5% of respondents recall Blue from other mediums.

ANALYSIS OF IMPACT OF PAID MERCHANDISE

To know the current market pulls 3rd question of questionnaire (a) was asked that When you
recently went to a retail store did you noticed Blue? and if Yes where?

The main purpose of asking this question was to know how well the paid form of merchandising
is doing or performing in the market. Those who have options other than the options given below
were asked to tick as NO. This question gave me the current pulls of merchandising tools that
whether the respondents noticed one of the options given to them.

From the data obtained

90 respondents among 550 havent seen merchandising tool in a retail store or they dent noticed
Blue in a retail store or they have seen Blue through any other medium which is not mentioned in
the given options.

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460 responses were positive that they saw Blue at a retail store following are the percentage of
respondents and their responses.

RECALL
Display in chiller Window display(warm)
Shop board or display on gate Counter tops

5%

38%

42%

15%

Company through me wanted to know among all the paid form of merchandising which is the
one performing best or contributing the most when it comes to recall the Brand.

So, from the study it came to know that shop board or display on gate has the most impact than
other paid types of paid form of merchandising.

Display in chiller had really great impact on customers/respondents (38%). Company pays some
amount or gives Blue of same amount to the retailer on storing Blue in chiller which is visible to
the customer.

Window display or warm stock display or sometimes we call it branding also has satisfactory
impact on customers to what the company pays to the retailers (15%).

Branding

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Counter tops only (5 %) where company spends more in supplying the bottle stand and giving
few bottles free every month depending on the sales of retailers doesnt has that much impact
that the company expects in comparison to what it spends on it.

DURABILITY ANALYSIS OF UNPAID MERCHANDISING TOOLS

Company through me wanted to know the durability of unpaid merchandising tools i.e. dandlers,
stickers, posters, banners and stock display.

A separate employee is appointed by the company as a merchandiser, he is the one held

responsible for all the installation of all the above mentioned unpaid merchandising tools.
Through me company wanted to know that how many times the merchandiser visits a store in a
particular month?

As the company specified a merchandiser should visit 2 or more times to every retail store in the
area to which he is appointed.

But it was found in most of the outlets that the merchandiser visits more than 3 times in a month
which was really unexpected by the company.

Following is the bar diagram showing the number of visits by a merchandiser to a retail store.

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 NO. OF VISITS BY A MERCHANDISER
50
45
40
35
Respondents
30
25
20
15
10
5
0
Once in 15 Once in a
Once in weak Never
days Month
No. of visits 46 26 21 7

From the above table you can see that 46 among 100 say that the merchandiser visits the store
nearly 4 or more than 4 times a month.

But the worst result was 7 respondents saying that merchandiser never visits them. When the
question was asked to the merchandiser that why dont you visit some outlets? The ultimate
answer was in the past when we install our tool the shopkeeper himself uninstalls it when we
move from their shop.

When the higher authority asked the merchandisers that how come you visited your allotted
outlets more than 2 times in a month? They said when they install any tool like poster or a
dangler it was found that it doesnt last longer so they need to go and again install it.

This answer again created a question that How long the tools last? And which tool lasts
longer?

DURABILITY OF UNPAID MERCHANDISING TOOLS

When it was found that the merchandiser needs to visit more than 2 times in a month company
through me decided to find out which is the unpaid merchandising tool that lasts longer.
Company with the survey made a standard format and came to conclusion that banner is the one
lasts longer among the all unpaid merchandising tools.

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But what I found out from my study is completely different and this was the result of change in
time and primary research. Company was following a standard policy which was of other well
knowing soft drink brands. And when compared to Blue from my research the result was
completely different.

Retailers are the one who closely observe or those are the one who can tell most accurately that
how long different kind of merchandise lasts according to them.

Following is the bar diagram showing the durability of the unpaid merchandising tools.

UNPAID MERCHANDISE DURABILITY

60

50
RETAILERS RESPONSE

40

30

20

10

0
Dangler Sticker Banner Poster
Response 14 57 20 9

As company thought that banner lasts longer than any other was not found true. Initially
company also thought that yes banner may be the one that lasts longer because once it is installed
at the top of the retail store or on the electricity pole near the retail store it is hard to uninstall by
any one, but that was not the case and found that the banner was removed by the outsiders or the
retailers themselves and put it to some other uses like stopping the rain water and covering some
eatables etc.

Another important parameter was installation. How difficult is the installation of a particular tool
and how much time it takes to do the same.

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Obviously banner takes more time than the other 3 alternatives because the merchandiser should
arrange a ladder to climb up and tie a banner and also it is risky when the merchandiser is trying
to install is anywhere near or on the electricity board.

On the other hand when it comes to installation of other 3 alternatives they are easy to install.

They rank in the fallowing manner (most easiest to install is the first)

1. Sticker
2. Poster
3. Dangler
4. Banner

So the study showed that even though installing the sticker was the easiest one is would last
longer than any other tool. This gave to company a very valuable information so that it could tell
their merchandisers to concentrate more on installing stickers and finding out more results why
not only banner but other tools i.e. dangler and poster fails to last longer which are also easy to
install.

COMPARISON OF PAID AND UNPAID FORM OF MERCHANDISING

Finally it was important for the company to know the overall impact on merchandising but
according to 2 parameters i.e. 1. Paid and unpaid and, 2. Inside and outside.

To make future policies company suggested me to find the information according to the 2
parameters mentioned above and analyze it, were the final conclusion may help a little bit in
uttering or give information in designing new policies.

Following is the diagram showing the impact according to the given 2 parameters.

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 Paid

window display Shop Board

display in chiller Display on gate
counter top
A[32.71%] B[32.71%]

Inside Outside
Stock display danglers
stickers
posters
banners

C[12.10%] D[21.64%]

Un-Paid

From the above you can say that more than 65% of impact of merchandising is seen by using a
paid form of merchandising that is window display, display in chiller, counter top, shop board
and display on gate.

What can company alter if there was instability between paid inside and paid outside is that it
would have changed the policy and try to stabilize it. If the impact is same of paid inside and
paid outside than here the cost of installing and maintaining the merchandising tool is very
important.

Window display, display in chiller and counter top doesnt cost as much as making a shop board
and installing a display on gate may cost. So company would go for the first three options i.e.
window display, display in chiller and counter top than that of investing time, money and
recourses in making and installing a shop board and display on gate respectively.

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Never the less more than 40% of the impact of merchandising tools is coming from the unpaid
form of merchandising tools which is really appreciable where company bares only the cost of
making that tools and cost of appointing a merchandiser wherein in paid form of merchandising
it has to incur the cost of visiting the outlet, cost of installing the out let, cost of making the
merchandising tools, and conducting a regular survey to ensure that the policy or the agreement
signed is correctly implemented all this adds as a cost to company.

Individually speaking both the sections i.e. A and B collectively contribute will to the companies
expectations. Where as in section C where company spends nothing is also having effect on
customers mind which is really great but one thing is for sure here the company has to ensure
that there should not be any stock outs otherwise this opportunity is lost by the company.

Section D is the focus area for me because the tools are pretty simple but still they have the
ability to spread the awareness in the society and finally influence people to buy Blue.

RELATIONSHIP OF MERCHANDISING AND SALES

Merchandising is a small part of advertising where as sales is a revenue generator of any

company. Whenever you go to big companies you mainly find that the sales department and the
marketing department are entirely different and they hardly coordinate to each other. But most of
the people think that advertising is directly related to the sales in some cases it may be true but
not in case of NDA.

In NDA the sales focus is just to go out and sell the product in any case they just know selling
whatever the product may be and never meet or contact the advertising person whether they are
making a great advertising or promotion strategy or not.

In the same sense Advertising department is not concerned with what the sale department is
doing weather they are pushing the product to increase the sales or not. They have their own
objectives given by management.

The main purpose of merchandising is to promote, increase awareness and get into the customers
mind and try to make them purchase, which ultimately increases the sales.

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And if the sales increases in the coming year the budget for advertising will also increase were
the advertiser can try new things and experiment his ideas.

So we can say that, not directly but indirectly both advertising and merchandising are related to
each other.

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 9. RECOMMENDATION & SUGGESTIONS

Blue is a non-carbonated flavored soft drink it was found that people still think it as a
carbonated soft drink and few call it as a fruit juice because it has flavors. So, the
perception of the people needs to be changed through proper merchandising.

The stock outside the chiller is also gaining the business or having the impact on
customers and spreading the awareness, care must be taken that there should be no
stock outs by inspecting the regular visits by salesmen.

Never the less the 2nd most important thing for a retailer to sell Blue is the customers
demand and the 3rd is advertising, so demand could be raised by proper advertising,
so company should bring in new and latest type of merchandising tools to support
retailers interest.

There is a huge scope for innovations in stickers, as from the study I came to know
that stickers are the most efficient tool of merchandising so company can make
innovations in it by having even more attractive colors and types.

It was found that in paid outside form of merchandise display on gate has more
impact than the shop board, it is obvious because as soon as the customer enters the
store he sees Blue on the gate so there it has more chances that he might pick it up or
go for a purchase. So, company should ensure that all the contracts of display on
gates are properly executed and try to do more of display on gate contracts.

Stock in chiller brings a significant amount of business is what the retailer says
because it is in the condition of ready to drink. So salesmen should always ensure the
bottles are properly placed in the chiller as it is his duty to do so.

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 Company is making good business there are few stores like welcome foods Bandra
(W), Chechda Collection Haji Ali etc who give a great business to the company. To
support them and increase the sales even more company should give them a chiller to
store only Blue.

As merchandising is a tool to increase awareness and make the customer purchase the
product, merchandising is must for new outlets or outlets which are recently
converted, that will support and increase the awareness that Blue is stocked here.

The quality of danglers needs to be improved because the quality of dangler which
the company is using now is of paper, which is now lasting to the extent what it is
expected due to heavy rain and wind. A plastic coating may help it a bit.

Company is now focusing on South Mumbai, to the major tool of spreading the
awareness in the area is on merchandising. So the marketing head should ensure a
proper merchandising strategy in all the vicinities in South Mumbai.

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 10. LIMITATIONS OF THE PROJECT

This entire project is based on the study of only 2 months (summer) i.e. May and June of
2013. So the data may not be applicable in other seasons.

Only few areas were covered from entire Mumbai so things may be a bit different where
the study was not conducted.

Some conclusions drawn by me based on the data is my own personal opinion it can be
contradicting to some other experts opinion.

Sample size of customers i.e. 550 is less for the company to come to a conclusion and
take a major decision.

Sample size of retailers is also less100 to make any changes in the existing policies with
retailers.

The primary data obtained in just 2 months cannot be said completely valid in the same
period of next year due to changing trend.

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 11. CONCLUSION
As from the entire study we came to know that merchandising is very important for any
beverage making company because is it one of the medium which increases awareness in
the society and also supports the retail stores to increase their sales.

Companies which are the initial starters cannot use big advertising medium to spread
awareness of their products, so for them merchandising tools can be a option for them.

There are number of tools that different companies use. But what is used by the NDA to
promote Blue is really a great mix. The company is following the strategy on just to push
the unpaid merchandising tools because that cost them less and has a greater impact too.

From the above study you can also now say that by going with both paid and unpaid
merchandising tools company can have penetration form both the ends that is form the
companies end (unpaid merchandise) and from retailers end (paid merchandise).

If NDA makes innovation in its merchandising tools and try to increase the durability of
the tools which it is using can really gain them a great success.

Whenever you talk about merchandising the person i.e. the merchandiser is of at most
important, if the company gets a experienced or the person who is really very enthusiastic
to work as a merchandiser can bring out a great results to the company.

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 Last but not the least the main purpose of merchandiser is to make the customer buy the
product and generate revenue for the company. Form the above study I can say that yes
customers are recalling the brand Blue through one of the merchandising tools so if we
do similar kind of research in future by increasing the sample size, that will give
company the real pulls of the market and that will help the company to decide how much
experiments they can do in merchandising tools and what is the amount they should
spend on the same.

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 12. BIBLIOGRAPHY & WEBSITES

Indian Infoline News Service,09:21, Mar 28, 2013

Websites:

www.naranggroup.com/

http://www.in-beverage.org/

http://www.indiainfoline.com/Markets/News/Danone-Narang-
Beverages-launches-Blue/5647766278

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