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INSTITUTE OF INFORMATION TECHNOLOGY & MANAGEMENT (IITM)
Submitted in partial fulfilment of the requirements for the award of the degree of Bachelor of Business Administration (BBA)
To Guru Gobind Singh Indraprastha University, Delhi
Guide: (Mr.Anmol Poddar )
Submitted by: (Aarushi Singh) Roll No.01521101709
Institute of Information Technology & Management, New Delhi – 110058
I am very grateful to my guide Mr. Anmol Poddar without whom this project would not have been possible. My guide’s provisions of proper guidelines helped me a lot. The help provided by various councils, books, and internet cannot be expressed in words.
I wish my sincere gratitude to my parents n friends who supported me in every little way they could, to complete the work.
I wish my sincere, whole-hearted thanks to all those who helped me in making this project.
Institute of Information Technology and Management Paper Title-Personality Development & Communication Skills-III (Minor Project Report) Paper Code-211 Assignment-MM: 18 Topic: Managing Retailing The topic must cover the following aspects: Meaning and Definition Concept and scope of Retailing Position of Retailers in modern marketing Functions of retailers Types of wholesalers Services rendered by retailers Kinds of retailers Marketing decisions by retailers Types of Retail Distribution Outlets mall scale retailers S Departmental stores Multiple shops or chain stores Mail order house Consumer’s cooperative store Supermarket Include relevant examples and figures in your assignment.
DEFINITION AND MEANING
Retailing consists of those business activities involved in the sale of goods and services to consumers for their personal, family, or household use. Retailing consists of the sale of goods or merchandise from a very fixed location, such as a department store, boutique or kiosk, or by mail, in small or individual lots for direct consumption by the purchaser. Retailing may include subordinated services, such as delivery. In commerce, a "retailer" buys goods or products in large quantities from manufacturers or importers, either directly or through a wholesaler, and then sells smaller quantities to the end-user. Retail establishments are often called shops or stores. Retailers are at the end of the supply chain. The term "retailer" is also applied where a service provider services the needs of a large number of individuals, such as a public utility, like electric power.
RM . Department stores. Zales Jewellers are all examples of retail stores. Service providers. Therefore. like Burdines and Macy's. is also retailers. hotels and hair salons. RM . but limited to the exact requirement of the ultimate user. and on-line stores.is an art. discount stores like Wal-Mart and K-Mart.is getting to know the final user on behalf of the producer. It is not limited to quantities. .com. through a series of stages. and necessitates employing several tools of logistics management for a complete end user satisfaction. is "Retail Management"(RM).The process of bringing the ultimate user to the main producer. like Amazon. bringing about operational efficiency at this last stage. What is retailing? Retailing involves selling products and services to consumers for their personal or family use. and specialty stores like The Gap. RM. like dentists. where retailing is the last one. and creating an environment so compelling that he looks nowhere else.is a process of facilitation.
Retailing encompasses selling through the mail. Manufacturer Wholesalers Retailers Consumer A retailer is a person. and financing. The selling need not necessarily take place through a store. The word ‘retail’ is derived from the French work retailer. merchandise. Between the producer and the consumer there is a middleman-the retailer. agent. door-to-door visit s—any channel that could be used . A common assumption is that retailing involves only the sale of products in stores. Retailing is defined as a conclusive set of activities or steps used to sell a product or a service to consumers for their personal or family use. or by a car rental agencies. Retailers perform specific activities such as anticipating customer’s wants. who links the producers and the ultimate consumers. or services to the ultimate consumer. acquiring market information. agency. meaning ‘to cut a piece off’ or ‘to break bulk’. or organisation which is instrumental in reaching the goods. developing assortments of products. company. However. it also includes the sale of services like those offered at a restaurant.CONCEPT OF RETAILING The distribution of consumer products begins with the producer and ends at the ultimate consumer. parlour. the internet.
a firm do a satisfactory job in its primary role i. catering to customers.to approach the consumer. As we all know. To enter retailing.. is easy and to fail is even easier. in order to survive in retailing. Retailing has become such an intrinsic part of our day today lives that it is often taken for granted. freedom of choice and higher levels of customer service. the ease of entry into retail business results in fierce competition and better value for customer. Why has retailing become such a popular method of conducting business? The answer lies in the benefits a vibrant retailing sector has to offer-an easier access to a variety of products.e. Therefore. .
The Future of Retailing Advances in technology. This sector contributes 10% of India's GDP and the current growth rate is 8. There are about 300 new malls. Tesco. have helped make retailing an even more challenging and exciting field in recent years. like the Internet. due to which the present 12 million mom-and-pop shops and kirana stores fear losing their business. Most predictions say that the sector might reach to US$ 400-600 billion by the year 2010. Many players are coming up with huge investments. The rising demand of branded products and increase in purchasing power have lured these companies to enter the market. Global retail giants such as Wal-Mart. as both the present players and new entrants are gearing up to explore the market.SCOPE OF RETAILING Retail is clearly the sector that is poised to show the highest growth in the next five years.5%. . The sector is set for a revolution. The nature of the business and the way retailing is done are currently undergoing fundamental changes. The present size of the organized retailing sector is approximately 3% and is expected to grow to 25-30% by the year 2010. 1500 supermarkets and 325 departmental stores currently under construction. Germany's Metro AG and many others are ready to enter the retail markets.
as both the present players and new entrants are gearing up to explore the market. For example.However. even though the Internet is beginning to make it possible for manufacturers to sell directly to consumers. touch and try them before they buy. Retail is clearly the sector that is poised to show the highest growth in the next five years. retailing in some form will always be necessary. In addition. But even with products. they may want products immediately and won't want to wait for them to be shipped. The sector is set for a revolution. like hair styling. and perhaps most importantly. Or. retailers who offer personal services. the country has identified new scope for retail sector development. Of course. bring together assortments of products for consumers to buy in the same way that bricks-and-mortar retailers do. traditional retailers with physical stores will continue to be necessary. The already revolutionizing urbanization and growing demand for finished products has necessitated development of new space for retail outlets.com. like Amazon. will need to have face-to-face interaction with the consumer. Also. the very vastness of cyberspace will still make it very difficult for a consumer to purchase every product he or she uses directly. On-line retailers. in many cases the experience of visiting the retailer is an important part of the purchase. Everything that the retailer can do to make the shopping experience pleasurable and fun can help ensure that customers come back. This sector contributes 10% of India’s GDP and the current growth rate . consumers often want to see. With new boom in the retail industry.
• The retail sector would generate employment for more than 2. due to which the present 12 million mom-and-pop shops and kirana stores fear losing their business. Estimates and Predictions: • The industry is estimated to be more than US$ 400 billion by a study of McKinsey. 1500 supermarkets and 325 departmental stores currently under construction.is 8. says an analysis by Ma Foi Management Consultants Ltd.5%. . The Economist Intelligence Unit (EIU) estimates the retail market in India to increase to US$608. • A KPMG report says that the organized retail would grow at a higher rate than GDP in the next five years. Many players are coming up with huge investments.5 million people by the year 2010.9 billion in 2009 from US$394 billion in2005. There are about 300 new malls. Most predictions say that the sector might reach to US$ 400-600 billion by the year 2010. The present size of the organized retailing sector is approximately 3% and is expected to grow to 25-30% by the year 2010.
Exports would increase due to greater sourcing of major players. • • Investment in whole supply chain would increase. • • A strong retailing sector would promote tourism. • In the long term it will be beneficial in the up-gradation of agriculture and small scale & medium scale industries. production. and distribution channels. • • The markets of the sector would flourish and develop. . Employment would increase and skills & manpower will develop.Benefits of FDI in Retail Sector: • Higher competition would lead to higher quality in products and services. • • Better lifestyle as better products would be introduced. Economies of scale would help lower consumer prices and increase the purchasing power of the consumer. Technology would be upgraded in terms of logistics.
Music World Entertainment Ltd. .. · Biggest player in India is Pantaloon Retail India Limited. Trent and the new entrants penetrating the market soon will include Reliance Retail Ltd.. Pantaloon Retail India Ltd. Liberty shoes Ltd. A glimpse of the International Retail: · One of the world’s largest industries exceeding US$ 9 trillion · 47 global fortune companies & 25 of Asia’s top 200 companies are retailers · Dominated by developed countries · US. Tesco. Germany’s Metro AG and many others are ready to enter the retail markets. Shoppers Stop. Globus Stores Pvt. etc. Ltd. EU & Japan constitute 80% of world retail sales. Subhiksha. Crossword. Indian Consumerism: The Indian consumer behaviour is rapidly changing with a shift in new generation’s preference towards luxury commodities. Boots Group. Carrefour... Ebony Retail Holdings Ltd. Titan Industries. Wal-Mart Stores. Big Bazaar.. Leading Indian Retailers: Bata India Ltd. The rising demand of branded products and increase in purchasing power has lured these companies to enter the market. Tesco. Global retail giants such as Wal-Mart. Food Bazaar.
which became a part of the civic planning. The next step was the commercial plazas. coupled with the stringent provisions of the Rent Control Act. RETAILING IN INDIA The retail industry in India is largely unorganized and predominately consists of small. There are. however. certain bottlenecks as well. The inconveniences caused by lack of parking place. owner-managed shops. Retailing is India’s largest industry in terms of contribution to GDP (Gross .RETAILING IN INDIA ORIGIN IN INDIA Although retailing does not enjoy the status of an industry. The origin of retail in India dates back to ancient times when the melas and mandis made their presence felt. act as a dissuasive factor for many players to initiate operations in the main markets. is grabbing attention. ushered in the entry big international brands opening their exclusive showrooms. the sheer size it will develop into. The changing socio economic patterns coupled with the consumption increase led to the emergence of the convenience stores. toilets and maintenance. independent. which comprised merely shops offering a variety of goods and services clubbed together. the scarcity of space. This also explains why the Raheja’s forayed into their retail venture-Shoppers’ Stop. The opening up of the economy only fuelled this globalization.
There is no integrated supply chain management outlook in the Indian traditional retail industry. the global management consultancy AT Kearney put retail trade at Rs. In 2000. which is quite low in comparison to the developed economies. 400. In fact. In 2001. . The share was 62.Domestic Product). per outlet.7% in 2001.1200 million in 2000.5 billion. barber shops) and pushcarts mobile vendors. There are also an unaccounted number of low cost Kiosks (tea stalls.food sales were worth Rs. the per capita retailing space is about 2 sq. while non. only Rs.000 crore.. 20. 039. snack centres. mt. Food sales constitute a high proportion of the total retail sales. the nonfood retailing sector registered faster year-on-year growth than the food sales sector. which is expected to increase to Rs. However. 000 crore by the year 2005-an annual increase of 20%. ft.800. 000 crore segment of the market is organized.2 billion. Total retail sales area in India was estimated at 328 million sq. The turnover from private labels by major retail chains was estimated at around Rs. 400.4 sq. with an average selling space of 29. mt. 000 crore retail markets are unorganized. worth approximately Rs. The trend to market private labels by a specific retail store is catching on in India as it helps to improve margins. 7. According to a survey by AT Kearney an overwhelming proportion of the Rs. There are around 5 million retail outlets in India. In India.4189.
7% 4. The modern retail formats are showing robust growth as several retail chains have established a base in metropolitan cities. especially in south India and are spreading all over India at a rapid pace. COMPOSITION OF URBAN OUTLETS RETAIL OUTLET Grocers Cosmetic stores Chemist Food stores General stores Tobacco.6% 14.0% 17.3% 6.7 billion. pan stores Others COMPOSITION 34.11.4% 17. 228. However.0% 6. families are experiencing growth in income but dearth of time. In urban India.0% EMERGENCE OF ORGANISED RETAILING Organized retailing in India represents a small fraction of the total retail market. which is adding to the . organized retail trade in India was worth Rs. space and rentals are providing to be the biggest constraints to the development of large formats in metropolitan cities since retailers are aiming at prime locations. In 2001. Women are taking up corporate jobs.
Therefore. provision stores. ready-to-eat food has been on the rise. The McKinsey report predicts that FDI will help the retail businesses to grow to US $ 460-470 billion by 2010. The demand for frozen. foreign retailers can enter the retailing sector only through restricted modes. Apart from this. At present. There has been a strong resistance to foreign direct investment (FDI) in retailing from small traders who fears that foreign companies would take away their business. Here. peeth and melas that come up at the same location at regular time intervals. Only 3. there are periodic or temporary markets. government has discouraged FDI in the retail sector. such as haats. especially in the metropolitan and large cities in India. lead to the closure of many small businesses and result in large-scale unemployment. such as joint ventures where Indian . Players that entered before the easing of restrictions on FDI in retail had to come through different modes. There is also a strong trend in favour of one-stop shops like supermarkets and department stores.6 million outlets cater to more than 700 million inhabitants of rural India. Global players in the retail segment have been entering the market for a while now.family’s income and leading to better lifestyles rising incomes has led to an increased demand for better quality products while lack of time has led to a demand for better quality products while lack of time has led to a demand for convenience and services. paan shops and ration shops are the most popular vehicles of retailing. Rural India continues to be serviced by small retail outlets. instant.
through diversified risks and volume sales command huge concessions on prices from the manufacturers. that the Urban Population although just 25% of the total.7%. cash and carry operations (Giant) and licensing (Marks & Spencer’s). The organized retailer should be able to. Retail in India’s largest industry after Agriculture with around 20% of the economically active population engaged in it and generation 10% of India’s GDP. It is only natural that the agricultural sector is the biggest employer with its contribution to GDP pegged at 26. The 12 million retail outlets in India are the highest in the world. franchising/local manufacturing/sourcing from small-scale sector (McDonald’s. CURRENT SCENARIO The Indian population is whooping 1 billion with 75% of the people living in villages and small towns. with the spending . Pizza Hut). The main condition for organised retailing is that the retailer should be able to manage and influence the supply chain variables in a commercially viable and sustainable manner. He should then be in a position to allow a trickle down of this advantage to consumers out of his saved costs. The chief driver of growth in the retail sector has been the consumer. In interesting to note.partner is an export house (Total Health Care). The growth of the efficient small store culture can be attributed to the 6 million villages distributed across the length and breadth of the country. is an astounding 250 million in size is growing at healthy rate of 7% per annum.
The core and the Lower middle have increased their share in the Growth. each city developed its own identity and shopping cluster. 2005). DRIVERS OF CHANGE IN RETAILING • • • • • • • Changing demographics and industry structure Expanding computer technology Emphasis on lower costs and prices Emphasis on convenience and service Focus on products Added experimentation Continuing growth of non-store retailing . street vendors and high-street shops for consumer durables and luxury goods. At present (September 23. covering an area of 21. In India we have 96 malls. Delhi has Connaught Place. And by year end the count will shoot up to 158 malls. Kiosks. according to a study by a fashion magazine Image. Bangalore has Brigade Road and Commercial Street. India will have 358 malls by 2007. for instance in Pune there is MG Road. Droves of middle-class Indians have broken off their love of traditional stand-alone shops that have ACs. To cater to this. Karol Bagh and South Extension.increasing at an average of 11% per annum.6 million sq ft. It will cover 34 million sq ft area. organized parking lots and other public amenities. The Indian consumer’s shopping needs are and traditionally have been fulfilled by Kirana sores.
The increasing numbers of product categories followed by multiple brands in each category complicate decision-making for both manufacturers and market intermediaries. As a result. ‘Marketers have to sell a new product several times. The role of retailers in the present competitive environment has gained attention from manufacturers because external parties such as market intermediaries and supplying partners are becoming increasingly powerful. It is necessary for marketers of consumer products to identify the need and motivations of their partners in the marketing channel. brand image. Retailers act as gatekeepers who decide on which new products should find their way to the shelves of their stores. and market profile in order to ensure a competitive edge. first within the company. they have a strong say in the success of the product or service launched by a business firm. governed by their individual sales philosophy. A product manager of household appliances claimed. Retailers undertake risk in selection of goods to be sold given the following major concerns: .In today’s competitive environment retailers have redefined their role in general. Retailers want of optimize sales within the limited shelf space. and in the value chain in particular. then to retailer and finally to the user of the product.’ It is a well-established fact that manufacturers need to sell their products through retail formats that are compatible with their business strategy. This is especially true in the case or new products.
the challenges for retail managers the world over are increasing-they must take decisions ranging from setting the price of a bag of rice to setting up multimillion dollar stores in malls. a retailer is required to make a conscious effort to position himself distinctively to face the . Marks and Spencer. determining what merchandise and services to offer.• Selling space available is relatively fixed and returns maximum profits. inventory management systems. financing pacts and wide-scale marketing plans. Therefore. training salespeople-these are just a few of the many functions that a retail manager has to perform on a perpetual basis. McDonald’s. Sears. The larger retailers have managed to set up huge supply/distribution chains. negotiating with suppliers. If such space is occupied by merchandise that is not moving. liberalization and highly aware customers. Selecting target markets. Retail formats and companies that were unknown three decades ago are now major forces in the economy. it will not result in profit. such as Wal-Mart. Retailing is a dynamic industry-constantly changing due to shifts in the needs of the consumers and the growth of technology. In the backdrop of globalization. The retailer may have to resort to substantial price reductions in order to get rid of the unsold stock. The world over retail business is denominated by smaller family run chain stores and regionally targeted stores but gradually more and more markets in the western world are being taken over by billion dollar multinational conglomerates.
business to be done. and. Retailers add value to products by making it easier for manufactures to sell and consumers to buy. He thus performs two functions like buying of goods and assembling of goods. retailers are a vital part of the business world. contact and make a purchase from the manufacturer every time you wanted to buy a candy bar. consequently. This is determined to a great extent by the retail mix strategy followed by accompany to sell its products. Provides two-way information . Similarly. . a sweater or a bar of soap.The retailer buys a variety of products from the wholesaler or a number of wholesalers.competition. By bringing multitudes of manufacturers and consumers together at a single point. it would be very costly for the manufactures of these products to locate and distribute them to consumers individually. FUNCTIONS OF RETAILERS As the final link between consumers and manufacturers. retailers make it possible for products to be sold. • • In brief they provide us with following functions: Provides personal services to all. It would be very costly and time consuming for you to locate.
• Undertake physical movement and storage of goods . deterioration in the quality and spoilage of goods. • • Assembles goods from various sources.He resorts to standardization and grading of goods in such a way that these are accepted by the customers. He bears the risks in connection with Physical Spoilage of goods and fall in price. theft. • • Create demand by window display etc. . Besides he bears risks on account of fire. Stock goods for ready supply to buyers. • Extend credit facility .• Facilitate standardisation and grading .The retailer performs storing function by stocking the goods for a consumer.He makes arrangement for delivery of goods and supply valuable market information to both wholesaler and the consumer.He develops personal contact with the consumers and gives them goods on credit.
For example. cosmetics. and cafeterias across the United States.and they handle about 59 percent of wholesale sales.000 specialized food wholesalers compete for the business of restaurants. a wholesale lumber yard that buys plywood from the producer is a merchant wholesaler. General merchandise wholesalers: These are service wholesalers who carry a wide variety of non-perishable items such as hardware. About four out of five wholesaling establishments in the United States are merchant wholesalers . Merchant wholesalers: These wholesalers own the products they sell. These wholesalers originally developed to . And several wholesalers may be competing for the same customers.takes title to the plywood for some period of time before selling to its customers. drugs. plumbing supplies. For example. Merchant wholesalers often specialize by certain types of products or customers and they service relatively small geographic areas. 2. hotels. electrical supplies.TYPES OF WHOLESALERS 1. about 3. It actually owns . furniture. and automobile equipment.
basic reference books. In consumer products. and travel books. Specialty wholesalers: These are service wholesalers who carry a very narrow range of products . The company offers hardcover best sellers. and small department stores. 4. Advanced Marketing is the leading wholesale supplier of books to membership warehouse clubs. . they serve the single. with their broad line of convenience and shopping products. they cover a wide geographic area and offer more specialized service. Single-line (or general-line) wholesalers: These are service wholesalers who carry a narrower line of merchandise than general merchandise wholesalers.and limited-line stores. A consumer products specialty wholesaler might carry only health foods or oriental foods instead of a full line of groceries. Consumers in different geographic areas are interested in different kinds of books and that affects what books will sell in a particular store. popular paperbacks. they might carry only food. In business products. wearing apparel. or certain types of industrial tools or supplies. they serve hardware stores. drugstores. For example. Or a specialty wholesaler might carry only automotive items and sell exclusively to mass-merchandisers. 3. Now.the general stores. electric appliance shops. For example. Specialty wholesalers often know a great deal about the final target markets in their channel.and offer more information and service than other service wholesalers.serve the early retailers . cookbooks.
These cashand-carry operators are especially common in less-developed nations where very small retailers handle the bulk of retail transactions. . Then the producer ships the order directly to the customers. or other business users .but they do not actually handle.5. retailers. The wholesaler can operate at lower cost because the retailers take over many wholesaling functions. Because drop-shippers do not have to handle the products. These wholesalers are mainly involved in selling.or just refuse to grant credit to a small business that may have trouble paying its bills. Some retailers.except that the customer must pay cash. They get orders from wholesalers. their operating costs are lower. And using cash-and-carry outlets may enable the small retailer to stay in business. Cash-and-carry wholesalers: These wholesalers operate like service wholesalers . So service wholesalers set a minimum charge . 6. Or the wholesaler may set up a cashand-carry department to supply the small retailer for cash on the counter. Drop-shippers commonly sell products so bulky that additional handling would be expensive and possibly damaging. stock. or deliver them. such as small auto repair shops. are too small to be served profitably by a service wholesaler.and pass these orders on to producers. Drop-shippers: These wholesalers own (take title to) the products they sell .
and deliver an order within hours. potato chips. These wholesalers operate in the hardware.with the "profits" going to the cooperative's customer-members. Their big advantage is that they deliver perishable products that regular wholesalers prefer not to carry.don't have a local wholesaler. Truck wholesalers: These wholesalers specialize in delivering products that they stock in their own trucks.tobacco. and France.especially those in smaller towns .7. and salad dressings . Many of these customers . Mail-order wholesalers. Some truck wholesalers operate 24 hours a day. 9. jewellery. the United Kingdom. the Netherlands. A 7-Eleven store that runs out of potato chips on a busy Friday night doesn't want to be out of stock all weekend! 8. For example.000 different computer accessories and supplies. These wholesalers sell out of catalogs that may be distributed widely to smaller industrial customers or retailers who might not be called on by other middlemen. Producers' cooperatives. Germany. every day . These wholesalers operate almost as fullservice wholesalers .truck wholesalers may provide almost the same functions as full-service wholesalers. Sweden. Cooperatives develop in agricultural markets . candy. Inmac uses a catalog to sell a complete line of 3. Canada. and general merchandise lines. By handling perishable products in general demand . sporting goods. Inmac's catalogs are printed in six languages and distributed to business customers in the United States.
Inc. the California Almond Growers Exchange has captured most of the retail market with its Blue Diamond brand. 10. Most grocers don't want to bother with reordering and maintaining displays of nonfood items (housewares.to improve the quality of farm products offered to the market. Examples of such organizations are Sunkist (citrus fruits).except that they usually are paid cash for what is sold or delivered. Some also brand these improved products . Sunmaid Raisin Growers Association. and Land O' Lakes Creameries. For example.and they often display them on their own wire racks. Rack jobbers are almost service wholesalers . Rack jobbers: These wholesalers specialize in nonfood products sold through grocery stores and supermarkets .and then promote the brands. . Successful producers' cooperatives emphasize sorting .where there are many small producers. hardware items. and books and magazines) because they sell small quantities of so many different kinds of products.
SERVICES RENDERED BY RETAILERS Services provided by the retailers to the wholesalers and manufacturers: They provide selling outlets to wholesalers and manufacturers. . They communicate the needs and desires of consumers to the manufacturers. They save the manufacturers from the inconvenience and expenses of selling the goods in small lots to a large number of consumers. They may also arrange for transportation of goods from the wholesalers' godowns to the ultimate consumers.
They even act as an advisor and guide to the consumers by bringing new products to their notice and educating them about its diverse uses. They sort out goods supplied by the wholesalers and keep them in convenient packages for the benefit of the consumers. They also provide other services to the consumers such as free home delivery. Thus they satisfy their demands and provide them a wide choice of goods. They keep the consumers informed about the changing trends in the market about the different varieties of products. etc. after sale services. credit facility. They may also perform storage function by keeping stocks of goods. . Services provided by the retailers to the consumers:They anticipate the needs of consumers and accordingly assemble goods of different varieties.
usually the individual who has the day-to-day responsibility for running the business.The vast majority of small businesses start out as sole proprietorships.KINDS OF RETAILERS On the basis of ownership- There are four basic legal forms of ownership for retailers: 1. 2. . two or more people share ownership of a single business.A partnership is a common format in India for carrying out business activities (particularly trading) on a small or medium scale. In a partnership. Sole proprietorship: . Partnership: . These firms are owned by one person.
but is clearly for a limited period of time or a single project. The owners are members. joint ventures may be taxed like association of persons. Joint venture: . 4. It acts like a general partnership. Classification of Retailers on the basis of Operational Structure Retail businesses are classified on the basis of their operational and organizational structure.A joint venture is not well defined in the law. Unless incorporated or established as a firm as evidenced by a deed. Limited liability Company (public and private): . Retail firms can be classified into five heads on the basis of their respective operational structures: 1. About 78% of these are small family businesses utilizing only household labour. An independent retailer owns one retail unit. .The total number of retailers in India is estimated to be over 5 million in 2003. sometimes at maximum marginal rates.3. and the duration of the LLC is usually determined when the organization papers are filed.The Limited Liability Company (LLC) is a relatively new type of hybrid business structure that is now permissible in most states. Independent retail unit: . whether to hire employees and manage the distributed sales function internally or to reach customers though franchised outlets owned and operated by the local entrepreneurs. Operational structure defines the key strategic decision of retail entity.
A chain retailer operates multiple outlets (store units) under common ownership. Leased Department or Shop – in – Shop: . Retail Chain: . in discount stores. 4.Co-operative outlets are generally owned and managed by co-operative societies. 5.It refers to department in a retail store that are rented to an outside party. a wholesaler.Franchising involves a contractual arrangement between a franchiser (which may be a manufacturer. it usually engages in some level of centralized (or coordinated) purchasing and decision making. Usually this is done in case of department and specially stores and also at times. Franchising: . . In this context the detailed example of Kendriya Bhandar in India. or a service sponsor) and a retail franchisee. which allows the franchisee to conduct a given form of business under and establishments name and according to a given pattern of business.2. Co-operative Outlets: . 3.
offering a variety of merchandise. and also compete against each other for the same customers. . and better visibility from the road. For example the Haldiram’s outlet on the Delhi-Jaipur highway and the McDonald’s outlet on Delhi Ludhiana highway. which attracts the customers staying close by.Retailers located at a connected to other retailers depend entirely on their site which is not sore’s drawing power and on the various promotional tools to attract customers. low rent. work together to attract customers to their retail area. a retailer locates his store in a place where a group o retail outlets. Classification of Retailers on the basis or Retail Location Retailers have also been classified according to their store location.associated Locations:. Retailers in a Business.In this case. Retailers can locate their stores in an isolated place and attract the customers to the store on their own strength-such as a small grocery store or paan shop in a colony. This type of location has several advantages including no competition. easy parking and lower property costs. Retailers in a free-standing location: . 2. Classification of retailers on the basis of location 1.
serious efforts are being made to design new airports facilities in order to incorporate substantial amounts of retail space. special or unique assortment good. retailers are looking for new marketing strategies to attract and retain customers. Govindappan naicleen street for grocery.3. particularly traditional independent retailers or chain stores. it suffices was to offer people the convenience of location. we also have in India-retailers who prefer specialized markets. For example. Godown Street is famous for clothes. Now everything is different. Previously. MARKETING DECISIONS BY RETAILERS Today.Besides the above location-based classification. duty-free shops and newsstands dominated the small amount of commercial space provided at airports. Retailers in Specialized Markets: . better than the competitor. Poo Kadia for food and vegetables. and Internet presentations credit cards that buyers can make purchases on credit. most of the cities have specialized markets famous for a particular product category. service. Usman Street for jewellery. At . Airport Retailing: . in Chennai. Bunder treet for stationary products. T Nagar for ready-made garments. Lately. In India.For quite some time. 4.
where there is always space on the Parking. trying to regain former popularity. depth of assortment. Not they need a credit card of a shop. All this leads to the fact that many retailers trade today are rethinking their marketing strategies. on the contrary. upgrade their facilities. low-income? Do buyers diversity. opening their offices in the suburbs. Example. department stores. People are not going to pay for the same or similar mark more. Many of them have historically located in the centre of cities.trying to reach maximum volume of sales. faced with competition from specialized and trading at a discount store. Many stores cut its own set of services and shops reduced prices. rebuild their stores. increased their number. and so have to open offices with a large range and variety of goods. What customer oriented shop: high. Others are increasingly satisfied with the sale. to reduce its dependence on marks on a national scale. because bank cards now accepted almost universally. the manufacturers sell their products wherever possible. moving to “small” private brands. started a real war. Supermarkets more money spent on activities sales promotion. convenience? Yet will identify and describe the target . Superstores compete with supermarkets. One of the most important and most responsible decisions that have to take a retailer associated with the target market. experimenting with trading by mail and tele marketing.many stores you will find quite the same range . and higher income families. medium. especially if the amount provided in this service is reduced.
It incurs low operating costs and is usually owned and operated by a proprietor. . the retailer will not make informed decisions on assortment. Retailers should periodically conduct market studies to monitor the achievement and satisfaction targets consumers. the price level. means and content of advertising. The most important feature is that the small-scale retailers have a direct and personal contact with their customers. Such retailers are very large in number but account for a small portion of the total retail business. This form of retailing faces the problems of small capital.are those retailers whose scale of operation is restricted to a small segment of the market and to a narrow range of products. lack of professionalism and low purchasing power.market. small-scale retailing is a very common. They generally hold small stocks of the products of regular use. TYPES OF RETAIL DISTRIBUTION OUTLETS Small-scale retailers: . simple and flexible way of distributing the products to the final consumers. Trying meeting the needs of a large number of different segments. Some retailers target market determined fairly accurately. But. they are not satisfying either one of them. Many companies do not have a specific target market. store environment.
The hawkers and pedlars.are those retailers who carry on their business by moving from place to place for selling the products and have no fixed business premises. They save time and efforts of customers in buying articles of ordinary use.The two prevalent forms of small scale retailing in India are:• Itinerants or Mobile traders: . They do not have any particular line of business and carry very little stock of those goods. They change their place of business according to their convenience and sales prospects. . market traders and street sellers fall under this category. cheap jacks. They serve either at the consumer's doorsteps or on busy places frequently visited by the customers.
are the small shops on the roadside. They are generally located in shopping centres.are engaged in purchase and sale of used goods like books. etc.are the shops which deal in all types of general consumer goods of regular use like bread. etc. etc. readymade garments shop. (iii) general stores or variety stores: . bus stops. clothes.They are set up in residential areas or busy markets. They sell a limited variety of products of regular use like stationery.• Fixed Shop Retailers: . grocery. paper and pencils. .(i) street stalls: .are the shops which deal in only one or two special types of goods. street-crossing. etc. (ii) dealers of second hand goods: . For example. chemist shops. They mainly include: . (iv) speciality shops: .are those retailers which have fixed business premises and operate through unit stores or small shops located in residential areas or markets. etc. They provide services like goods on credit and home delivery to their customers. butter. sweets shop. grocery shops.
The various forms of large scale retailers are:- • Departmental stores: . Large-scale Retailers: . All its departments are centrally controlled but each forms a complete sales unit in itself and specialises in a particular line of product. etc.are those retailers whose scale of operation extends to a large segment of the market and to a wide range of products. sales promotion. But it involves more of professionalism in selling the products through the use of various promotional techniques like advertising. publicity. This form of retailing involves high operating costs and lacks personal contact with the customers. They have a fixed line of business in which they have invested huge capital. Such retailers are not very large in number. They offer a .are large scale retail establishments comprising of a number of departments in the same building.
and post and telegraph offices and so on. They sell goods at lower prices than the departmental stores. They sell a wide variety of consumer goods of regular use such as food items. Such stores are generally located in central places of big cities so that they can be easily accessible to the customers. Customers select the goods . groceries.wide choice of products to the customers under one roof.are large scale retail shops operating at lower costs. car parking. Supermarkets: . They also provide many amenities for customer's convenience such as restaurants.etc at one place. recreation rooms.
The goods dealt are generally meant for everyday use and are readily acceptable to all kinds of customers. they do not provide additional facilities to their customers. It is also called self-service stores. They offer goods at lower prices as they enjoy economies of bulk buying. . • Multiple Shops or chain stores:. But.are a group of retail stores of the same type under one common ownership and centralised management but are located at various locations.themselves without salesman's assistance. All of them deal in similar range of products and sell the same standardised products at the same terms and conditions.
Orders from customers may be secured by advertising in newspapers or journals or through telephone contacts.• Mail order houses: . • Consumer cooperative stores: . The aim . They are incorporated as an association under the cooperative societies act.are those retail trading establishments which receive their orders by mail and deliver the goods by parcel or post express. it helps the consumers to get their requirements at their own place and thus saves their time and expenses. They purchase their requirements of goods in bulk from manufacturers and wholesalers and sell them to its members at lower prices.are the cooperative stores which are owned and operated by the consumers themselves. The post office is their main channel of distribution. But this type of retailing is nonpersonal and without any face-to-face contact between buyers and sellers. The membership of such stores is voluntary and capital is subscribed by the members themselves by purchasing shares of a small denomination. However.
This form of retailing can sell goods at places and at times where other types of retailing are not convenient or economical. etc.of such cooperative stores is to render service to its members and not to maximise profits. tickets.is a new and complementary form of retailing operated by inserting coins or tokens into the machine by the buyers. mother dairy sells milk through such vending machines. . These are used to sell prepacked and low cost products of mass consumptions like beverages. In return. buyers receive a specified quantity of the product from the machine. • Automatic vending machines: . For example.
It has 4 . Bangalore and Gurgaon (delhi).RELEVANT EXAMPLE • Big Bazaar: the Indian wall-mart (organised retailer) Pantaloon retail (India) limited is today organised as one of the pioneers in the business of organised retailing in the country with a turnover of Rs 400 crores. The company is headquartered in Mumbai with zonal offices at Kolkata.
Kanpur. focussing on ‘value for money’ segment. The brands include Pantaloon.kinds of stores: 14 pantaloon family stores. John Miller and Bare. Bangalore. which targets the large and growing upper-middle and middle class of Indian society. Pantaloon has come up with an excellent revenue model. Big Bazaar has strong own brand names in its portfolio across product categories. Pune. It has been one of the pioneers in organized retailing in India. Pantaloon plans to target the upper middle and the middle class segment. 6 food bazaar stores with over 6. Kishore Biyani. which forms the large chunk of Indian population. . Hyderabad. This segment is very price conscious and always looks out for value for money. Bagpur. Pantaloon retail India limited is the flagship company of the pantaloon group promoted bt Mr. Mumbai. Chennai. 7 big bazaar discount hypermarkets. and Delhi.5 lakh sq. Ahmadabad. Pantaloon successfully launched its discount store chain.ft retail space across Kolkata.
msn.BIBLIOGRAPHY BOOKS: Retailing Management by Swapna Pradhan Retailing Managemnet by Barton A Weitz SITES: www.com .com www.google.
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