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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 .com. discount stores like Wal-Mart and K-Mart. through a series of stages.The process of bringing the ultimate user to the main producer. hotels and hair salons. Service providers. where retailing is the last one. is "Retail Management"(RM). Zales Jewellers are all examples of retail stores. It is not limited to quantities.is an art.is a process of facilitation. and on-line stores. and necessitates employing several tools of logistics management for a complete end user satisfaction. like dentists. RM. but limited to the exact requirement of the ultimate user. is also retailers. 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. . RM .is getting to know the final user on behalf of the producer. like Amazon. like Burdines and Macy's. Therefore. Department stores. and specialty stores like The Gap. and creating an environment so compelling that he looks nowhere else.
agency. company. acquiring market information. or organisation which is instrumental in reaching the goods. Manufacturer Wholesalers Retailers Consumer A retailer is a person. it also includes the sale of services like those offered at a restaurant. Retailers perform specific activities such as anticipating customer’s wants.CONCEPT OF RETAILING The distribution of consumer products begins with the producer and ends at the ultimate consumer. who links the producers and the ultimate consumers. meaning ‘to cut a piece off’ or ‘to break bulk’. However. or by a car rental agencies. developing assortments of products. or services to the ultimate consumer. 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. Retailing encompasses selling through the mail. The selling need not necessarily take place through a store. The word ‘retail’ is derived from the French work retailer. and financing. the internet. Between the producer and the consumer there is a middleman-the retailer. door-to-door visit s—any channel that could be used . merchandise. agent. parlour.
As we all know.to approach the consumer. freedom of choice and higher levels of customer service. 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. in order to survive in retailing. catering to customers. the ease of entry into retail business results in fierce competition and better value for customer. a firm do a satisfactory job in its primary role i.e. Therefore.. Retailing has become such an intrinsic part of our day today lives that it is often taken for granted. To enter retailing. is easy and to fail is even easier. .
. The nature of the business and the way retailing is done are currently undergoing fundamental changes.SCOPE OF RETAILING Retail is clearly the sector that is poised to show the highest growth in the next five years. as both the present players and new entrants are gearing up to explore the market. due to which the present 12 million mom-and-pop shops and kirana stores fear losing their business. Many players are coming up with huge investments. have helped make retailing an even more challenging and exciting field in recent years. There are about 300 new malls. Global retail giants such as Wal-Mart.5%. The rising demand of branded products and increase in purchasing power have lured these companies to enter the market. The sector is set for a revolution. Germany's Metro AG and many others are ready to enter the retail markets. Most predictions say that the sector might reach to US$ 400-600 billion by the year 2010. like the Internet. The Future of Retailing Advances in technology. Tesco. This sector contributes 10% of India's GDP and the current growth rate is 8. 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.
Or.com. But even with products. With new boom in the retail industry. like hair styling. will need to have face-to-face interaction with the consumer. The already revolutionizing urbanization and growing demand for finished products has necessitated development of new space for retail outlets. On-line retailers. the very vastness of cyberspace will still make it very difficult for a consumer to purchase every product he or she uses directly. The sector is set for a revolution. the country has identified new scope for retail sector development. Of course. like Amazon. For example. retailing in some form will always be necessary. consumers often want to see. in many cases the experience of visiting the retailer is an important part of the purchase. traditional retailers with physical stores will continue to be necessary. This sector contributes 10% of India’s GDP and the current growth rate . retailers who offer personal services. Everything that the retailer can do to make the shopping experience pleasurable and fun can help ensure that customers come back. Retail is clearly the sector that is poised to show the highest growth in the next five years. even though the Internet is beginning to make it possible for manufacturers to sell directly to consumers.However. In addition. they may want products immediately and won't want to wait for them to be shipped. touch and try them before they buy. Also. bring together assortments of products for consumers to buy in the same way that bricks-and-mortar retailers do. and perhaps most importantly. as both the present players and new entrants are gearing up to explore the market.
The present size of the organized retailing sector is approximately 3% and is expected to grow to 25-30% by the year 2010.5 million people by the year 2010. 1500 supermarkets and 325 departmental stores currently under construction. Most predictions say that the sector might reach to US$ 400-600 billion by the year 2010.9 billion in 2009 from US$394 billion in2005. There are about 300 new malls. due to which the present 12 million mom-and-pop shops and kirana stores fear losing their business.is 8. • The retail sector would generate employment for more than 2. says an analysis by Ma Foi Management Consultants Ltd. The Economist Intelligence Unit (EIU) estimates the retail market in India to increase to US$608. Many players are coming up with huge investments. . Estimates and Predictions: • The industry is estimated to be more than US$ 400 billion by a study of McKinsey. • A KPMG report says that the organized retail would grow at a higher rate than GDP in the next five years.5%.
. • • Investment in whole supply chain would increase. production. • • The markets of the sector would flourish and develop. Employment would increase and skills & manpower will develop. Exports would increase due to greater sourcing of major players. • • Better lifestyle as better products would be introduced.Benefits of FDI in Retail Sector: • Higher competition would lead to higher quality in products and services. and distribution channels. Economies of scale would help lower consumer prices and increase the purchasing power of the consumer. • • A strong retailing sector would promote tourism. Technology would be upgraded in terms of logistics. • In the long term it will be beneficial in the up-gradation of agriculture and small scale & medium scale industries.
. Germany’s Metro AG and many others are ready to enter the retail markets. Tesco. EU & Japan constitute 80% of world retail sales. Wal-Mart Stores. Ebony Retail Holdings Ltd. Crossword. Pantaloon Retail India Ltd.. Music World Entertainment Ltd.. Big Bazaar. Indian Consumerism: The Indian consumer behaviour is rapidly changing with a shift in new generation’s preference towards luxury commodities. Subhiksha. Carrefour. etc. Food Bazaar. Titan Industries. Ltd... Tesco. 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. Global retail giants such as Wal-Mart. · Biggest player in India is Pantaloon Retail India Limited. Trent and the new entrants penetrating the market soon will include Reliance Retail Ltd. . Leading Indian Retailers: Bata India Ltd. Boots Group. The rising demand of branded products and increase in purchasing power has lured these companies to enter the market. Liberty shoes Ltd. Shoppers Stop. Globus Stores Pvt.
the sheer size it will develop into. The opening up of the economy only fuelled this globalization. The origin of retail in India dates back to ancient times when the melas and mandis made their presence felt. is grabbing attention. which became a part of the civic planning.RETAILING IN INDIA ORIGIN IN INDIA Although retailing does not enjoy the status of an industry. independent. This also explains why the Raheja’s forayed into their retail venture-Shoppers’ Stop. toilets and maintenance. certain bottlenecks as well. ushered in the entry big international brands opening their exclusive showrooms. There are. coupled with the stringent provisions of the Rent Control Act. which comprised merely shops offering a variety of goods and services clubbed together. the scarcity of space. The changing socio economic patterns coupled with the consumption increase led to the emergence of the convenience stores. The next step was the commercial plazas. RETAILING IN INDIA The retail industry in India is largely unorganized and predominately consists of small. The inconveniences caused by lack of parking place. act as a dissuasive factor for many players to initiate operations in the main markets. owner-managed shops. Retailing is India’s largest industry in terms of contribution to GDP (Gross . however.
7% in 2001. while non. barber shops) and pushcarts mobile vendors. There are around 5 million retail outlets in India. There are also an unaccounted number of low cost Kiosks (tea stalls. 7.4189. which is quite low in comparison to the developed economies.000 crore. 20.. mt. Total retail sales area in India was estimated at 328 million sq. with an average selling space of 29. In fact. 400.800. However. . snack centres. 400. the nonfood retailing sector registered faster year-on-year growth than the food sales sector. only Rs. The share was 62. worth approximately Rs. mt. According to a survey by AT Kearney an overwhelming proportion of the Rs. In 2000. ft.1200 million in 2000. 000 crore segment of the market is organized. 000 crore by the year 2005-an annual increase of 20%. The turnover from private labels by major retail chains was estimated at around Rs.4 sq. In India. In 2001.food sales were worth Rs. 039. which is expected to increase to Rs.5 billion. the global management consultancy AT Kearney put retail trade at Rs. the per capita retailing space is about 2 sq.Domestic Product). per outlet.2 billion. 000 crore retail markets are unorganized. The trend to market private labels by a specific retail store is catching on in India as it helps to improve margins. Food sales constitute a high proportion of the total retail sales. There is no integrated supply chain management outlook in the Indian traditional retail industry.
0% 6. In 2001. Women are taking up corporate jobs.7% 4.0% 17. pan stores Others COMPOSITION 34.11. In urban India.4% 17. families are experiencing growth in income but dearth of time. which is adding to the .0% EMERGENCE OF ORGANISED RETAILING Organized retailing in India represents a small fraction of the total retail market.6% 14. 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. The modern retail formats are showing robust growth as several retail chains have established a base in metropolitan cities. organized retail trade in India was worth Rs. 228. 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.3% 6.7 billion. However.
Only 3. Rural India continues to be serviced by small retail outlets. paan shops and ration shops are the most popular vehicles of retailing. 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. Players that entered before the easing of restrictions on FDI in retail had to come through different modes. government has discouraged FDI in the retail sector. ready-to-eat food has been on the rise. lead to the closure of many small businesses and result in large-scale unemployment. peeth and melas that come up at the same location at regular time intervals. Therefore. there are periodic or temporary markets. The demand for frozen. The McKinsey report predicts that FDI will help the retail businesses to grow to US $ 460-470 billion by 2010. such as joint ventures where Indian . foreign retailers can enter the retailing sector only through restricted modes. Apart from this. such as haats. instant. Here. At present. especially in the metropolitan and large cities in India.6 million outlets cater to more than 700 million inhabitants of rural India. 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. There is also a strong trend in favour of one-stop shops like supermarkets and department stores. provision stores.
The 12 million retail outlets in India are the highest in the world. that the Urban Population although just 25% of the total.partner is an export house (Total Health Care). 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. with the spending . The organized retailer should be able to. through diversified risks and volume sales command huge concessions on prices from the manufacturers. The chief driver of growth in the retail sector has been the consumer. CURRENT SCENARIO The Indian population is whooping 1 billion with 75% of the people living in villages and small towns. 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. It is only natural that the agricultural sector is the biggest employer with its contribution to GDP pegged at 26. cash and carry operations (Giant) and licensing (Marks & Spencer’s). 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. is an astounding 250 million in size is growing at healthy rate of 7% per annum. He should then be in a position to allow a trickle down of this advantage to consumers out of his saved costs. franchising/local manufacturing/sourcing from small-scale sector (McDonald’s. In interesting to note.7%. Pizza Hut).
covering an area of 21. The core and the Lower middle have increased their share in the Growth. In India we have 96 malls.increasing at an average of 11% per annum. Karol Bagh and South Extension. To cater to this. India will have 358 malls by 2007.6 million sq ft. Kiosks. street vendors and high-street shops for consumer durables and luxury goods. Delhi has Connaught Place. Bangalore has Brigade Road and Commercial Street. The Indian consumer’s shopping needs are and traditionally have been fulfilled by Kirana sores. each city developed its own identity and shopping cluster. for instance in Pune there is MG Road. 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 . At present (September 23. organized parking lots and other public amenities. It will cover 34 million sq ft area. And by year end the count will shoot up to 158 malls. according to a study by a fashion magazine Image. Droves of middle-class Indians have broken off their love of traditional stand-alone shops that have ACs. 2005).
It is necessary for marketers of consumer products to identify the need and motivations of their partners in the marketing channel. A product manager of household appliances claimed. brand image. This is especially true in the case or new products. Retailers undertake risk in selection of goods to be sold given the following major concerns: . then to retailer and finally to the user of the product.In today’s competitive environment retailers have redefined their role in general. and in the value chain in particular. ‘Marketers have to sell a new product several times. As a result. The increasing numbers of product categories followed by multiple brands in each category complicate decision-making for both manufacturers and market intermediaries. and market profile in order to ensure a competitive edge. they have a strong say in the success of the product or service launched by a business firm.’ It is a well-established fact that manufacturers need to sell their products through retail formats that are compatible with their business strategy. 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. governed by their individual sales philosophy. first within the company. Retailers want of optimize sales within the limited shelf space. Retailers act as gatekeepers who decide on which new products should find their way to the shelves of their stores.
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. inventory management systems.• Selling space available is relatively fixed and returns maximum profits. negotiating with suppliers. Sears. The retailer may have to resort to substantial price reductions in order to get rid of the unsold stock. Marks and Spencer. financing pacts and wide-scale marketing plans. If such space is occupied by merchandise that is not moving. Retail formats and companies that were unknown three decades ago are now major forces in the economy. a retailer is required to make a conscious effort to position himself distinctively to face the . Selecting target markets. In the backdrop of globalization. Therefore. training salespeople-these are just a few of the many functions that a retail manager has to perform on a perpetual basis. Retailing is a dynamic industry-constantly changing due to shifts in the needs of the consumers and the growth of technology. it will not result in profit. The larger retailers have managed to set up huge supply/distribution chains. liberalization and highly aware customers. 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. determining what merchandise and services to offer. McDonald’s. such as Wal-Mart.
it would be very costly for the manufactures of these products to locate and distribute them to consumers individually. a sweater or a bar of soap. business to be done. This is determined to a great extent by the retail mix strategy followed by accompany to sell its products. . • • In brief they provide us with following functions: Provides personal services to all. consequently. Retailers add value to products by making it easier for manufactures to sell and consumers to buy. Provides two-way information . FUNCTIONS OF RETAILERS As the final link between consumers and manufacturers. retailers are a vital part of the business world. By bringing multitudes of manufacturers and consumers together at a single point. retailers make it possible for products to be sold. It would be very costly and time consuming for you to locate. He thus performs two functions like buying of goods and assembling of goods. contact and make a purchase from the manufacturer every time you wanted to buy a candy bar.The retailer buys a variety of products from the wholesaler or a number of wholesalers.competition. Similarly. and.
He makes arrangement for delivery of goods and supply valuable market information to both wholesaler and the consumer. Stock goods for ready supply to buyers. theft.He resorts to standardization and grading of goods in such a way that these are accepted by the customers.• Facilitate standardisation and grading .He develops personal contact with the consumers and gives them goods on credit. deterioration in the quality and spoilage of goods. • • Create demand by window display etc. • • Assembles goods from various sources. He bears the risks in connection with Physical Spoilage of goods and fall in price. Besides he bears risks on account of fire.The retailer performs storing function by stocking the goods for a consumer. • Undertake physical movement and storage of goods . . • Extend credit facility .
about 3. 2. a wholesale lumber yard that buys plywood from the producer is a merchant wholesaler.TYPES OF WHOLESALERS 1. and automobile equipment. furniture. plumbing supplies. For example.and they handle about 59 percent of wholesale sales. General merchandise wholesalers: These are service wholesalers who carry a wide variety of non-perishable items such as hardware.takes title to the plywood for some period of time before selling to its customers. Merchant wholesalers: These wholesalers own the products they sell. And several wholesalers may be competing for the same customers. hotels. About four out of five wholesaling establishments in the United States are merchant wholesalers . It actually owns . Merchant wholesalers often specialize by certain types of products or customers and they service relatively small geographic areas.000 specialized food wholesalers compete for the business of restaurants. These wholesalers originally developed to . drugs. electrical supplies. cosmetics. For example. and cafeterias across the United States.
popular paperbacks. and small department stores. or certain types of industrial tools or supplies.serve the early retailers . For example. 3. they serve the single. Specialty wholesalers: These are service wholesalers who carry a very narrow range of products . Now. basic reference books. . In consumer products. electric appliance shops. they cover a wide geographic area and offer more specialized service. Advanced Marketing is the leading wholesale supplier of books to membership warehouse clubs. wearing apparel. cookbooks. A consumer products specialty wholesaler might carry only health foods or oriental foods instead of a full line of groceries.and offer more information and service than other service wholesalers.and limited-line stores. Specialty wholesalers often know a great deal about the final target markets in their channel. In business products. Single-line (or general-line) wholesalers: These are service wholesalers who carry a narrower line of merchandise than general merchandise wholesalers. drugstores. For example. they might carry only food. and travel books. Or a specialty wholesaler might carry only automotive items and sell exclusively to mass-merchandisers. they serve hardware stores. The company offers hardcover best sellers. with their broad line of convenience and shopping products. Consumers in different geographic areas are interested in different kinds of books and that affects what books will sell in a particular store. 4.the general stores.
or just refuse to grant credit to a small business that may have trouble paying its bills. are too small to be served profitably by a service wholesaler.except that the customer must pay cash. their operating costs are lower. Then the producer ships the order directly to the customers. . Or the wholesaler may set up a cashand-carry department to supply the small retailer for cash on the counter. Drop-shippers: These wholesalers own (take title to) the products they sell . They get orders from wholesalers. These cashand-carry operators are especially common in less-developed nations where very small retailers handle the bulk of retail transactions.and pass these orders on to producers.but they do not actually handle. So service wholesalers set a minimum charge . 6. These wholesalers are mainly involved in selling. such as small auto repair shops. or deliver them. 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. stock. Drop-shippers commonly sell products so bulky that additional handling would be expensive and possibly damaging. Cash-and-carry wholesalers: These wholesalers operate like service wholesalers . And using cash-and-carry outlets may enable the small retailer to stay in business. or other business users . retailers.5. Some retailers.
jewellery. and France. Some truck wholesalers operate 24 hours a day.don't have a local wholesaler. 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. These wholesalers operate in the hardware.and deliver an order within hours. Sweden. These wholesalers operate almost as fullservice wholesalers . Canada. Truck wholesalers: These wholesalers specialize in delivering products that they stock in their own trucks. the Netherlands. every day . By handling perishable products in general demand . and general merchandise lines. Germany. Their big advantage is that they deliver perishable products that regular wholesalers prefer not to carry. the United Kingdom.7.truck wholesalers may provide almost the same functions as full-service wholesalers. Mail-order wholesalers.000 different computer accessories and supplies. Producers' cooperatives. Many of these customers . 9. Cooperatives develop in agricultural markets .with the "profits" going to the cooperative's customer-members. potato chips. 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. sporting goods. Inmac's catalogs are printed in six languages and distributed to business customers in the United States.tobacco. and salad dressings . candy.especially those in smaller towns . Inmac uses a catalog to sell a complete line of 3. For example.
hardware items. Rack jobbers are almost service wholesalers . Most grocers don't want to bother with reordering and maintaining displays of nonfood items (housewares. Successful producers' cooperatives emphasize sorting .and they often display them on their own wire racks. For example. Some also brand these improved products . Examples of such organizations are Sunkist (citrus fruits). Rack jobbers: These wholesalers specialize in nonfood products sold through grocery stores and supermarkets .where there are many small producers. Inc. the California Almond Growers Exchange has captured most of the retail market with its Blue Diamond brand. and Land O' Lakes Creameries. 10.to improve the quality of farm products offered to the market.except that they usually are paid cash for what is sold or delivered. Sunmaid Raisin Growers Association. . and books and magazines) because they sell small quantities of so many different kinds of products.and then promote the brands.
SERVICES RENDERED BY RETAILERS Services provided by the retailers to the wholesalers and manufacturers: They provide selling outlets to wholesalers and manufacturers. They may also arrange for transportation of goods from the wholesalers' godowns to the ultimate consumers. 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 perform storage function by keeping stocks of goods. credit facility. They keep the consumers informed about the changing trends in the market about the different varieties of products. . after sale services. etc. 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. Thus they satisfy their demands and provide them a wide choice of goods. Services provided by the retailers to the consumers:They anticipate the needs of consumers and accordingly assemble goods of different varieties. They also provide other services to the consumers such as free home delivery.
Sole proprietorship: . These firms are owned by one person.KINDS OF RETAILERS On the basis of ownership- There are four basic legal forms of ownership for retailers: 1.A partnership is a common format in India for carrying out business activities (particularly trading) on a small or medium scale. Partnership: . . two or more people share ownership of a single business.The vast majority of small businesses start out as sole proprietorships. 2. usually the individual who has the day-to-day responsibility for running the business. In a partnership.
Joint venture: . . Retail firms can be classified into five heads on the basis of their respective operational structures: 1. Independent retail unit: .The total number of retailers in India is estimated to be over 5 million in 2003. and the duration of the LLC is usually determined when the organization papers are filed. Unless incorporated or established as a firm as evidenced by a deed. The owners are members.The Limited Liability Company (LLC) is a relatively new type of hybrid business structure that is now permissible in most states. sometimes at maximum marginal rates. 4.3. joint ventures may be taxed like association of persons. Limited liability Company (public and private): . but is clearly for a limited period of time or a single project. It acts like a general partnership. An independent retailer owns one retail unit. About 78% of these are small family businesses utilizing only household labour.A joint venture is not well defined in the law. 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. Classification of Retailers on the basis of Operational Structure Retail businesses are classified on the basis of their operational and organizational structure.
in discount stores.A chain retailer operates multiple outlets (store units) under common ownership. Retail Chain: . or a service sponsor) and a retail franchisee. .2. a wholesaler. 5. Usually this is done in case of department and specially stores and also at times. In this context the detailed example of Kendriya Bhandar in India. it usually engages in some level of centralized (or coordinated) purchasing and decision making. Franchising: . which allows the franchisee to conduct a given form of business under and establishments name and according to a given pattern of business. Co-operative Outlets: .Co-operative outlets are generally owned and managed by co-operative societies.Franchising involves a contractual arrangement between a franchiser (which may be a manufacturer. 3.It refers to department in a retail store that are rented to an outside party. 4. Leased Department or Shop – in – Shop: .
and also compete against each other for the same customers. Retailers in a free-standing location: .associated Locations:. Retailers in a Business. 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. work together to attract customers to their retail area. For example the Haldiram’s outlet on the Delhi-Jaipur highway and the McDonald’s outlet on Delhi Ludhiana highway. . a retailer locates his store in a place where a group o retail outlets. low rent. Classification of Retailers on the basis or Retail Location Retailers have also been classified according to their store location. offering a variety of merchandise. easy parking and lower property costs. which attracts the customers staying close by. Classification of retailers on the basis of location 1. This type of location has several advantages including no competition. 2.In this case. and better visibility from the road.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.
Govindappan naicleen street for grocery. particularly traditional independent retailers or chain stores. it suffices was to offer people the convenience of location. T Nagar for ready-made garments. For example. Airport Retailing: .3. Poo Kadia for food and vegetables. In India. Now everything is different. special or unique assortment good. in Chennai.Besides the above location-based classification. and Internet presentations credit cards that buyers can make purchases on credit. we also have in India-retailers who prefer specialized markets. Bunder treet for stationary products. Usman Street for jewellery. service. serious efforts are being made to design new airports facilities in order to incorporate substantial amounts of retail space.For quite some time. MARKETING DECISIONS BY RETAILERS Today. Lately. most of the cities have specialized markets famous for a particular product category. 4. duty-free shops and newsstands dominated the small amount of commercial space provided at airports. Previously. Retailers in Specialized Markets: . At . retailers are looking for new marketing strategies to attract and retain customers. Godown Street is famous for clothes. better than the competitor.
especially if the amount provided in this service is reduced. to reduce its dependence on marks on a national scale. What customer oriented shop: high. Superstores compete with supermarkets. low-income? Do buyers diversity. upgrade their facilities. moving to “small” private brands. the manufacturers sell their products wherever possible. medium. opening their offices in the suburbs. Supermarkets more money spent on activities sales promotion. Many of them have historically located in the centre of cities. Many stores cut its own set of services and shops reduced prices. rebuild their stores. Others are increasingly satisfied with the sale. and higher income families. faced with competition from specialized and trading at a discount store. on the contrary. because bank cards now accepted almost universally. convenience? Yet will identify and describe the target . department stores. Not they need a credit card of a shop. and so have to open offices with a large range and variety of goods. One of the most important and most responsible decisions that have to take a retailer associated with the target market. Example. increased their number. where there is always space on the Parking. depth of assortment. People are not going to pay for the same or similar mark more. trying to regain former popularity. experimenting with trading by mail and tele marketing. All this leads to the fact that many retailers trade today are rethinking their marketing strategies.many stores you will find quite the same range .trying to reach maximum volume of sales. started a real war.
simple and flexible way of distributing the products to the final consumers.are those retailers whose scale of operation is restricted to a small segment of the market and to a narrow range of products. small-scale retailing is a very common. they are not satisfying either one of them. It incurs low operating costs and is usually owned and operated by a proprietor. means and content of advertising. Retailers should periodically conduct market studies to monitor the achievement and satisfaction targets consumers.market. They generally hold small stocks of the products of regular use. . This form of retailing faces the problems of small capital. the price level. the retailer will not make informed decisions on assortment. Many companies do not have a specific target market. lack of professionalism and low purchasing power. Such retailers are very large in number but account for a small portion of the total retail business. store environment. Trying meeting the needs of a large number of different segments. TYPES OF RETAIL DISTRIBUTION OUTLETS Small-scale retailers: . But. The most important feature is that the small-scale retailers have a direct and personal contact with their customers. Some retailers target market determined fairly accurately.
They serve either at the consumer's doorsteps or on busy places frequently visited by the customers. cheap jacks. They change their place of business according to their convenience and sales prospects. 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: . . market traders and street sellers fall under this category. The hawkers and pedlars. They do not have any particular line of business and carry very little stock of those goods.are those retailers who carry on their business by moving from place to place for selling the products and have no fixed business premises.
etc. etc. (iv) speciality shops: . street-crossing. grocery. etc.are the shops which deal in all types of general consumer goods of regular use like bread. chemist shops. For example. They are generally located in shopping centres.are those retailers which have fixed business premises and operate through unit stores or small shops located in residential areas or markets. bus stops.They are set up in residential areas or busy markets. They sell a limited variety of products of regular use like stationery. They provide services like goods on credit and home delivery to their customers. .(i) street stalls: . etc. readymade garments shop. (iii) general stores or variety stores: . grocery shops.• Fixed Shop Retailers: . etc. They mainly include: .are engaged in purchase and sale of used goods like books. (ii) dealers of second hand goods: . butter. clothes. sweets shop.are the small shops on the roadside. paper and pencils.are the shops which deal in only one or two special types of goods.
But it involves more of professionalism in selling the products through the use of various promotional techniques like advertising. They have a fixed line of business in which they have invested huge capital. Large-scale Retailers: . publicity.are large scale retail establishments comprising of a number of departments in the same building. All its departments are centrally controlled but each forms a complete sales unit in itself and specialises in a particular line of product. Such retailers are not very large in number. This form of retailing involves high operating costs and lacks personal contact with the customers. etc. The various forms of large scale retailers are:- • Departmental stores: .are those retailers whose scale of operation extends to a large segment of the market and to a wide range of products. sales promotion. They offer a .
recreation rooms. groceries.etc at one place. Such stores are generally located in central places of big cities so that they can be easily accessible to the customers. They sell a wide variety of consumer goods of regular use such as food items.wide choice of products to the customers under one roof. They also provide many amenities for customer's convenience such as restaurants. and post and telegraph offices and so on. car parking.are large scale retail shops operating at lower costs. They sell goods at lower prices than the departmental stores. Customers select the goods . Supermarkets: .
• Multiple Shops or chain stores:. they do not provide additional facilities to their customers. All of them deal in similar range of products and sell the same standardised products at the same terms and conditions. The goods dealt are generally meant for everyday use and are readily acceptable to all kinds of customers. They offer goods at lower prices as they enjoy economies of bulk buying. . It is also called self-service stores.themselves without salesman's assistance.are a group of retail stores of the same type under one common ownership and centralised management but are located at various locations. But.
• Consumer cooperative stores: . They purchase their requirements of goods in bulk from manufacturers and wholesalers and sell them to its members at lower prices. They are incorporated as an association under the cooperative societies act. The post office is their main channel of distribution. it helps the consumers to get their requirements at their own place and thus saves their time and expenses.are those retail trading establishments which receive their orders by mail and deliver the goods by parcel or post express.• Mail order houses: . However. Orders from customers may be secured by advertising in newspapers or journals or through telephone contacts. The membership of such stores is voluntary and capital is subscribed by the members themselves by purchasing shares of a small denomination.are the cooperative stores which are owned and operated by the consumers themselves. But this type of retailing is nonpersonal and without any face-to-face contact between buyers and sellers. The aim .
of such cooperative stores is to render service to its members and not to maximise profits. . buyers receive a specified quantity of the product from the machine. etc. For example. tickets.is a new and complementary form of retailing operated by inserting coins or tokens into the machine by the buyers. This form of retailing can sell goods at places and at times where other types of retailing are not convenient or economical. • Automatic vending machines: . In return. These are used to sell prepacked and low cost products of mass consumptions like beverages. mother dairy sells milk through such vending machines.
Bangalore and Gurgaon (delhi). The company is headquartered in Mumbai with zonal offices at Kolkata.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. It has 4 .
6 food bazaar stores with over 6. Bangalore. focussing on ‘value for money’ segment. This segment is very price conscious and always looks out for value for money. Pantaloon plans to target the upper middle and the middle class segment. It has been one of the pioneers in organized retailing in India. . Pantaloon successfully launched its discount store chain. and Delhi. Hyderabad. Pantaloon retail India limited is the flagship company of the pantaloon group promoted bt Mr. John Miller and Bare. Bagpur.5 lakh sq. 7 big bazaar discount hypermarkets. Pantaloon has come up with an excellent revenue model. Mumbai. Ahmadabad.kinds of stores: 14 pantaloon family stores. Chennai.ft retail space across Kolkata. which targets the large and growing upper-middle and middle class of Indian society. Kanpur. Big Bazaar has strong own brand names in its portfolio across product categories. The brands include Pantaloon. which forms the large chunk of Indian population. Pune. Kishore Biyani.
google.com www.msn.com .BIBLIOGRAPHY BOOKS: Retailing Management by Swapna Pradhan Retailing Managemnet by Barton A Weitz SITES: www.