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Retailing is the most active and attractive sector of last decade. While the retailing industry itself has been present since ages in our country, it is only the recent past that it has witnessed so much dynamism. Indian retailing today is at an interesting crossroads. The retail sales are at the highest point in history and new technologies are improving retail productivity there are many opportunities to start a new retail business. There are just over a 6 million retail outlets operating across the Indian cities from north to south and from east to west. This large number of outlets, many of which are trying to serve and satisfy the same market segments, results in fierce competition and better values for shoppers. The retail mix is the combination of factors retail used to satisfied customer needs and influences their purchase decision. It’s include the type of merchandise and services offered, merchandise pricing, advertising, promotional programs store design merchandise display, assistance to customer provided by salespeople, and convenience of the store’s location. Biggest challenge for organized retailing is to create a “customer-pull” environment that increases the amount of impulse shopping. Research shows that the chances of senses dictating sales are up to 10-15%. Due to which there is emergence of discount stores which is expected to spearhead the organized retailing revolution. The title of the project is “Effectiveness of Retailing Mix for Customer Satisfaction at Big Bazaar” which the researcher has carried out, as retail mix greatly influences the customer satisfaction level and the customer perception towards that store. It is one of the hot issue in todays retail competition world which is very important for all the retail store to follow that. This study was done to know if customers are really satisfied with the present retaling mix in the Big bazaar and also to find out how the store envirnoment influences the shopping behaviour of the customer to know how the store environment can be improved.
1.2 Rationale of the study
The project is all about to determine the satisfaction level of the customers from the store environment and analyze the impact of retailing mix on the customer satisfaction level, and to improve the store environment to increase the sales and to attract the customers, this study helps to improve the environment of the store to reach the customer satisfaction level and improve the merchandising in Big Bazaar.
The word "Retail" originates from a French-Italian word. Retailer is someone who cuts off or sheds a small piece from something. Retailing is the set of activities that markets products or services to final consumers for their own personal or household use. It does this by organizing their availability on a relatively large scale and supplying them to customers on a relatively small scale. Retailer is a Person or Agent or Agency or Company or Organization who is instrumental in reaching the Goods or Merchandise or Services to the End User or Ultimate Consumer.
2.2 Indian Retail Industry:
Indian retail industry is the largest industry in India, contributing to over 13% of the country's GDP. Organized retail industry in India is expected to rise 35% yearly being driven by strong income growth, changing lifestyles, and favorable demographic patterns. It is expected that by 2011-12 modern retail industry in India will be worth US$ 590 billion. It has further been predicted that the retailing industry in India will amount to US$ 833 billion by 2013 and US$ 1.3 trillion by 2018. Shopping in India has witnessed a revolution
with the change in the consumer buying behavior and the whole format of shopping also altering. Industry of retail in India which has become modern can be seen from the fact that there are huge shopping centers, malls and sprawling complexes which offer food, shopping, and entertainment all under the same roof. Indian retail industry is expanding itself most aggressively; as a result a great demand for real estate is being created. Indian retailers preferred means of expansion is to expand to other regions and to increase the number of their outlets in a city. In the Indian retailing industry, food is the most dominating sector and is growing at a rate of 9% annually. The branded food industry is trying to enter the India retail industry and convert Indian consumers to branded food. Since at present 60% of the Indian grocery basket consists of non- branded items. Indian retail industry is progressing well and for this to continue retailers as well as the Indian government will have to make a combined effort. Indian retailing industry has seen phenomenal growth in the last five years. Organized retailing has finally emerged from the shadows of unorganized retailing and is contributing significantly to the growth of Indian retail sector. The “India Retail Sector Analysis report helps clients to analyze the opportunities and factors critical to the success of retail industry in India. Indian retail industry is going through a transition phase. Most of the retailing in our country is still in the unorganized sector. The spread out of the retails in US and India shows a wide gap between the two countries. Though retailing in India is undergoing an exponential growth, the road ahead is full of challenges. 2.2.1 Key Challenges: Location: "Right Place, Right choice" Location is the most important ingredient for any business that relies on customers, and is typically the prime consideration in a customers store choice. Locations decisions are harder to change because retailers have to either make sustainable investments to buy and develop real estate or commit to long term lease with developers. When formulating decision about where to locate, the retailer must refer to the strategic plan:
o Investigate alternative trading areas. o Determine the type of desirable store location o Evaluate alternative specific store sites Merchandise: The primary goal of the most retailers is to sell the right kind of merchandise. Merchandising consists of activities involved in acquiring particular goods and services and making them available at a place, time and quantity that enable the retailer to reach its goals. Merchandising is perhaps, the most important function for any retail organization, as it decides what finally goes on shelf of the store. Pricing: Pricing is a crucial strategic variable due to its direct relationship with a firm's goal and its interaction with other retailing elements. The importance of pricing decisions is growing because today's customers are looking for good value when they buy merchandise and services. Price is the easiest and quickest variable to change Target Audience: "Consumer the prime mover" "Consumer Pull", however, seems to be the most important driving factor behind the sustenance of the industry. The purchasing power of the customers has increased to a great extent, which is influencing the retail industry to a great extent, a variety of other factors also seem to fuel the retailing boom. 2.2.2 Scale of Operations: Scale of operations includes all the supply chain activities, which are carried out in the business. It is one of the challenges that the Indian retailers are facing. The cost of business operations is very high in India.
Estimated size of retail in India (in $bn) Share of organized retail (%) in India
Figure 2.1 Size Of Indian Retail
2.3.1 Indian retail types Malls Branded stores Specialty stores Departmental stores Super markets Discount stores Hyper markets Shopping markets Convenient stores Malls: The largest form of organized retailing today Located mainly in metro cities, in proximity to urban outskirts. Ranges from 60,000 sq ft to 7,00,000 sq. ft. and above. They lend an ideal shopping experience with an amalgamation of product, service and entertainment, all under a common roof. Examples include Shoppers Stop, mega Mart, Pantaloon, Wall mart etc.
Chains such as the Bangalore based Kids Kemp, the Mumbai books retailer Crossword, RPG's Music World and the Times Group's music chain Planet M, are focusing on specific market segments and have established themselves strongly in their sectors.
As the name suggests, discount stores or factory outlets, offer discounts on the MRP through selling in bulk reaching economies of scale or excess stock left over at the season. The product category can range from a variety of perishable/ non perishable goods. Department Stores: Large stores ranging from 20000-50000 sq. ft, catering to a variety of consumer needs. Departmental stores further classified into localized departments such as clothing, toys, home, groceries etc. Departmental Stores are expected to take over the apparel business from exclusive brand showrooms. Among these, the biggest success is K Raheja's Shoppers Stop, which started in Mumbai and now has more than seven large stores (over 30,000 sq. ft) across India and even has its own in store brand for clothes called Stop!. Marts/Supermarkets: Large self service outlets, catering to varied shopper needs are termed as Supermarkets. These are located in or near residential high streets. These stores today contribute to 30% of all food & grocery organized retail sales. Super Markets can further be classified in to mini supermarkets typically 1,000 sq ft to 2,000 sq ft and large supermarkets ranging from of 3,500 sq ft to 5,000 sq ft. having a strong focus on food & grocery and personal sales. Convenience Stores: These are relatively small stores 400-2,000 sq. feet located near residential areas. They stock a limited range of high-turnover convenience products and are usually
open for extended periods during the day, seven days a week. Prices are slightly higher due to the convenience premix
2.3.2 Traditional Retail Scene in India India is the country having the most unorganized retail market. Traditionally the retail business is run by Mom & Pop having Shop in the front & house at the back. More than 99% retailers function in less than 500Sq.Ft of area. All the merchandise was purchased as per the test & vim and fancies of the proprietor also the pricing was done on ad hock basis or by seeing at the face of customer. Generally the accounts of trading & home are not maintained separately. Profits were accumulated in slow moving & non-moving stocks which were to become redundant or consumed in-house. Thus profits were vanished without their knowledge. The Manufactures were to distribute goods through C& F(Carry and Forward) agents to Distributors & Wholesalers. Retailers happen to source the merchandise from Wholesalers & reach to end-users. The merchandise price used to get inflated to a great extent till it reaches from Manufacturer to End-user. Selling prices were largely not controlled by Manufacturers. Branding was not an issue for majority of customers. More than 99% customers are price sensitive & not quality or Brand Sensitive at the same time they are Brand conscious also. Weekly Bazaar in many small towns was held & almost all the commodities were on the scene including livestock. Bargaining was the unwritten law of market. Educational qualification level of these retailers was always low. Hence market was controlled by handful of distributors &/or Wholesalers. Virtually there was only one format of retailing & that was mass retail. Retailer to consumer ratio was very low, for all the categories without exception. Varity in terms of quality, Styles were on regional basis, community based & truly very low range was available at any given single place. Almost all the purchases / (buying) by mass population was need oriented & next turn may be on festivals, Marriages, Birthdays & some specific occasions. Impulsive buying or consumption is restricted to food or vegetables etc. Having extra pair of trousers or Shirts or Casuals & Formals & leisure wear & sports wear & different pair of shoes for occasions is till date is a luxury for majority population except for those living in Metros.
Purchasing power of India urban consumer is very low and that of Branded merchandise in categories like Apparels, Cosmetics, Shoes, Watches, Beverages, Food, Jewellery, are slowly seeping into the lifeline of Indian City folks. However electronic & electrical home appliances do hold appropriate image into the minds of consumers. Brand name does matter in these white goods categories. In the coming times also majority of organized retailers will find it difficult to keep balance with rest of the unbranded retail market which is very huge. Retailing consists of those business activities involved in the sale of goods and services to consumers for their personal, family, or household use. Retailing comprises of four elements customer orientation, coordinated effort, value-driven, and goal orientation.
Figure 2.2 Evolution of Indian Retail 2.3.3 Drivers of change in retailing Changing demographics and industry structure Expanding Computer technology
Emphasis on lower cost and prices Emphasis on convenience and service Focus on productivity Added experimentation 2.3.4 Essentials of Retailing Customer orientation- The retailer makes a careful study of the needs of the customer and attempts to satisfy those needs. Goal orientation – The retailer has clear cut goal and devises strategies to achieve those goals. Value driven approach- the retailer offers good value to the consumer with merchandise having the price and quality appropriate for the target market. Coordinated efforts- Every activity of the firm is aligned to the goal and is designed to maximize its efficiency and deliver value to the consumer
2.4 Organized Retail is evolving with changing customer aspirations
Organized retailing in most economies has typically passed through four distinct phases in its evolution cycle. In the first phase, new entrants create awareness of modern formats and rise consumer expectations. In the second phase consumers demand modern formats as the markets develop – thereby leading to strong growth. As with the life cycle in any industry, the high rate of growth would lead to a stage where the market would reach maturity and all the players would strengthen their positions. This will be followed by the final phase where the market would reach saturation, the growth would be limited and for sustainable growth, retailers would explore new markets as well as evaluate inorganic opportunities. 2.4.1 Growth Factors in Indian Organized Retail sector: The growth factors in India organized sector are various but it is mainly due to the fact that India's economy is booming. Also, the rise in the working population which is young, pay- packets which are hefty, more nuclear families in urban areas, rise in the
number of women working, more disposable income and customer aspiration, western influences and growth in expenditure for luxury items. All these are the factors for the growth in Indian organized retail sector. According to the Icrier report, the retail business in India is estimated to grow at 13% from $322 billion in 2006-07 to $590 billion in 2011-12. The unorganized retail sector is expected to grow at about 10% per annum with sales expected to rise from $ 309 billion in 2006-07 to $ 496 billion in 2011-12. With over 1,000 hypermarkets and 3,000 supermarkets projected to come up by 2011, India will need additional retail space of 700,000,000 sq ft (65,000,000 m2) as compared to today. Current projections on construction point to a supply of just 200,000,000 sq ft (19,000,000 m2), leaving a gap of 500,000,000 sq ft (46,000,000 m2) that needs to be filled, at a cost of US$15–18 billion. Many Indian companies have entered the retail industry in India and this is also a factor in the growth of Indian organized retail sector. Reliance Industries Limited is planning to invest US$ 6 billion in the organized retail sector in I India by opening 1500 supermarkets and 1000 hypermarkets. Bharti Telecoms is planning a joint venture worth £ 750 million with Tesco a global retail giant. Pantaloons are planning to invest US$ 1 billion in order to increase its retail space to 30 million square feet. Such huge investment is also a factor in the growth of the organized retail sector in India. The world's largest retailer by sales, Walmart Stores Inc and Sunil Mittal's Bharti Enterprises have entered into a joint venture agreement and they are planning to open 10 to 15 cash-and-carry facilities over seven years, Carrefour the world’s second largest retailer by sales, is planning to setup two business entities in the country one for its cashand-carry business and the other a master franchisee which will lend its banner, technical services and know how to an Indian company for direct-to-consumer retail. The world’s fifth largest retailer by sales, Costco Wholesale Corp (Costco) known for its warehouse club model is also interested in coming to India and waiting for the right opportunity. Tesco Plc., plans to set up shop in India with a wholesale cash-and-carry business and will help Indian conglomerate Tata group to grow its hypermarket business. The factors for growth in Indian organized retail sector are many and that’s the reason behind its massive growth, but for this to continue both the Indian retailers and the government will have to work together.
2.4.2 Penetration of Organised Retail
Figure 2.3 Penetration of Organized Retail
2.4.3 Indian Organized Retail Sector's Impact on Lifestyles The Indian organized retail sector's impact changed the lifestyle of the Indian consumers drastically. The evident increase in consumerist activity is colossal which has already chipped out a money making recess for the Indian organized retail sector. With the onset of a globalized economy in India, the Indian consumer's psyche has been changed. People have become aware of the value of money. Now a days the Indian consumers are well versed with the concepts about quality of products & services. These demands are the visible impacts of the Indian organized retail sector. Since the liberalization policy of 1990, the Indian economy, and its consumers are getting whiff of the latest national & international products with the help of print & electronic media. The social changes with the rapid economic growth due to trained
personnel’s, fast modernization; enhanced availableness of retail space is the positive effects of Liberalization. The growth factors of organized retail in India are:
Increase in per capita income which in turn increases the household consumption Demographical changes and improvements in the standard of living Change in patterns of consumption and availability of low-cost consumer credit Improvements in infrastructure and enhanced availability of retail space Entry to various sources of financing The non-food sector, segments comprising apparel, accessories, fashion, and lifestyle
felt the significant change with the emergence of new stores formats like convenience stores, mini Marts, mini supermarkets, large supermarkets, and hyper marts. Even food retailing has became an important retail business in the national arena, with large format retail stores, establishing stores all over India. With the entry of packaged foods like MTR, ITC Ashirbad, fast foods chains like McDonald's, KFC, beverage parlors’ like Nescafe, Tata Tea, Café Coffee and Barista, the Indian food habits has been altered. These stores have earned the reputation of being 'super saver locations'. India will be a unique business arena in whole of the global economy, for the social and economic parameters would overrule the big bang of the vivid competition. Previously mastered by the unorganized retail sector, India opened up late as an economy in 1990 until then the idea of retail formats were spread by the government.
2.4.4 Employment Generation by India Organized Retail Sector Lots of employment generation by Indian Organized Retail Sector in the near future. India is going through a radical economic change. Though it is very infant stage, people can feel the climate is changing. The unorganized retailers take the lion's share in the Indian retail sector, but the organized retailers are growing at a good pace, and promise an increase of proportion of by 2016. This is to be the largest sector after the agricultural sector. The increase in the number of consumers twinned with the introduction of organized sector has brought numerous corporate investments in retail sector. The entry of super markets,
enormous departmental stores, and shopping malls has encouraged the retailers to look at new business plans of expansion. An economic growth on a monumental scale is offered by the Indian retail sector, equally in the national and international market which in turn will generate a huge source of employment and a variety of options for the consumers. The Ernst & Young's report 'The Great Indian Retail Story', anticipates that the Indian retail sector would come up with 2 million employment opportunities within the year 2010. Benefits to the economic growth:
Better quality products and services would lead to better competition More exports bring more foreign direct investments Organized Indian retail sector would encourage tourism Along with the employment boom there would be a vast development in the expertise of the human resource
There would remain future scope for improvements in agriculture, small, and medium scaled with the help of the Indian retail sector The present employment in the retail business is nearly 4 crores and around 20 crores
depend on this sector. There is a scope of better exposure to the international standards with the entry of transnational companies, which in turn is encouraging more & more retail management programs to open up and help bridging the gap of supply & demand of talented professionals for management.
2.4.5 Scope of the Indian Retail Market: The scope of the Indian retail market is immense for this sector is poised for the highest growth in the next 5 years. The Indian retail industry contributes 13% of the country’s GDP in the Indian retail market the scope for growth can be seen from the fact that it is expected to rise to US$ 590 billion in 2011-12 from US$ 309 billion in 2006-07. The organized retailing sector in India was only 7% in 2008 and is expected to rise to 25-30% by the year 2016. There are under construction at present around 325
departmental stores, 300 new malls, and 1500 supermarkets. This proves that there is a tremendous scope for growth in the Indian retail market. The growth of scope in the Indian retail market is mainly due to the change in the consumer’s behavior. For the new generation have preference towards luxury commodities which have been due to the strong increase in income, changing lifestyle and demographic patterns which are favorable. The scope of the Indian retail market has been seen by many retail giants and that’s the reason that many new players are entering the India retail industry
2.5 Major players:
Pantaloon Retail: It is headquartered in Mumbai with 450 stores across the country employing more than 18,000 people. It can boast of launching the first hypermarket Big Bazaar in India in 2001. An all-India retail space is of 5 million sq. ft. which is expected to reach 30 mn by 2010. It is not only the largest retailer in India with a turnover of over Rs. 20 billion but is present across most retail segments - Food & grocery (Big bazaar, Food bazaar), Home solutions (Hometown, furniture bazaar, collection-i), consumer electronics (e-zone), shoes (shoe factory), Books: music & gifts (Depot), Health & Beauty care services (Star, Sitara and Health village in the pipeline), e-tailing (Futurbazaar.com), entertainment (Bowling co.) One of their recent innovations include e-commerce’ hybrid format of ’small’ shops , the area for these stores will be 150 sq. ft. fitted with 40 digital screens. Customers will be encouraged to browse through the entire range of products on digital screen. They will be able to place the order, the delivery of which will be arranged by the shop to their homes within a few hours. K Raheja Group They forayed into retail with Shopper’s Stop, India’s first departmental store in 2001. It is the only retailer from India to become a member of the prestigious Intercontinental Group of Departmental Stores (IGDS). They have signed 50:50 joint venture with the Nuance Group for Airport Retailing. Shoppers Stop has 7, 52, 00 sq ft of retail space with a turnover of Rs 6.75 billion. The first Hypercity opened in Mumbai in 2006 with an area of 1, 20,000
sq. ft. clocking gross sales of Rs. 1 bn in its first year. Crossword brand of book stores, Homes stop a store for home solutions, Mothercare a concept stocking merchandise related to childcare are also owned by them. Recently, Raheja’s have signed MoU with the Home Retail Group of UK to enter into a franchise arrangement for the Argos formats of catalogue & internet retailing. The group has announced plans to establish a network of 55 hypermarkets across India with sales expected to cross the US$100 million mark by 2010. Tata group: Established in 1998, Trent - one of the subsidiaries of Tata Group - operates Westside, a lifestyle retail chain and Star India Bazaar - a hypermarket with a large assortment of products at the lowest prices. In 2005, it acquired Landmark, India's largest book and music retailer. Trent has more than 4 lakh sq. ft. space across the country. Westside registered a turnover of Rs 3.58 mn in 2006. Tata’s has also formed a subsidiary named Infiniti retail which consists of Croma, a consumer electronics chain. It is a 15000-17000 sq. ft. format with 8 stores as of September 2007. Another subsidiary, Titan Industries, owns brands like “Titan”, the watch of India has 200 exclusive outlets the country and Tanishq, the jewellery brand, has 87 exclusive outlets. Their combined turnover is Rs 6.55 billion.Trent plans to open 27 more stores across its retail formats adding 1.5 mn sq ft of space in the next 12 DLF malls. Bharti-Walmart Their plans include US$ 7 bn investment in creating retail network in the country including 100 hypermarkets and several hundred small stores. They have signed a 50:50 percent joint venture agreement with Walmart. Wal-Mart will do the cash & carry while Bharti will do the front-end. Reliance India’s most ambitious retail plans are by reliance, with investments to the tune of Rs. 30,000 cr ($ 6.67 bn) to set up multiple formats with expected sales of Rs 90,000 crores ($20 bn) by 2009-10. There are already more than 300 Reliance Fresh stores and the first Reliance Mart Hypermart has opened in Ahmedabad. The next ones are slated to open at Jamnagar, followed by marts in Delhi / NCR, Hyderabad, Vijaywada, Pune and Ludhiana.
AV Birla Group They have a strong presence in apparel retailing through Madura garments which is subsidiary of Aditya Birla Nuvo Ltd. They own brands like Louis Phillipe, Van Heusen, Allen Solly, Peter England, Trouser town. In other segments of retail, AV Birla Group has announced investment plans of Rs 8000 - 9000 crores in the first 3 years till 2010. The acquisition of Trinethra (food & grocery) chain in the south has moved their tally to 400 stores in the country. Their “More” range of 15 supermarkets are slated to open at Nashik, Pune and other tier II cities in Western India in 2007.
2.6 Functions of retailing: Retailers play a significant role as a conduit between manufactures, wholesalers, suppliers, and consumers. In this context, they perform various functions like storing, breaking bulk, holding stock, as a channel of communication, storage, advertising, and certain additional services. Storing: Manufacturers usually make one or a variety of products and would like to sell their inventory to a few buyers to reduce costs. Final consumers, in contrast, prefer a large variety of goods and services to choose from and usually buy them in small quantities. Retailers are able to balance the demands of both sides, by collecting an assortment of goods from different sources, buying them in sufficiently large quantities, and selling them to consumers in small units. The above process is referred to as the storing process. Through this process, retailers undertake activities and perform functions that add to the value of the products and services sold to the consumer. Supermarkets in the US offer, on an average, 15,000 different items from 500 companies. Customers are able to choose from a wide range of designs, sizes, and brands from one location. If each manufacturer had a separate store for its own products, customers would have to visit several stores to complete their shopping. While all the retailers offer an assortment, they specialize in types of assortment offered and the market to which the offering is made. Westside provides clothing and accessories, while a chain like
nil irises specializes in food and bakery items. Shoppers stop targets the elite urban class, while pantaloons is targeted at the middle class. Breaking bulk: Breaking bulk is another function performed by retailing. The word retailing is derived from the French word retailer, meaning to cut a piece of. To reduce transportation costs, manufacturers and wholesalers typically ship range cartons of the products, which are then tailored by the retailers into smaller quantities to meet individual’s consumptions needs. Holding stock: Retailers also offer the service of holding stock for the manufacturers. Retailers maintain an inventory that allows for instant availability of the products to the consumers. It helps to keep prices stable and enables the manufacturer to regulate production. Consumers can keep a small stock of products at home as they know that this can be replenished by their retailer and can save on inventory carrying costs. Additional Services: Retailers ease the change in ownership of merchandise by providing services that make it convenient to buy and use products. Providing products guarantees, after-sales services and dealing with consumer complaints are some of the services that add value to the actual product at the retailers end. Retailers also offer credit and hire- purchase facilities to the customers to enable them to buy a product now and pay for it later. Retailers fill orders, promptly process, deliver and install products. Salespeople are also employed by retailers to answer queries and provide additional information about the displayed products.
Pantaloon Retail India Ltd (PRIL) has emerged as the leading retailer in India with its chain of Pantaloon, Big Bazaar and Food Bazaar stores. With the right mix of management capabilities, high growth product profile, well-developed strategy and extensive IT and logistics capabilities, PRIL has ensured rapid growth. More importantly, while most organized retailers are struggling to be in back, PRIL has demonstrated a consistent track record of profitable growth. 3.1.1 Company Research PRIL has chalked out an aggressive expansion plan to increase its retail space to over 17,40,000 sq.ft. over the next two years. Space for additional 4 Pantaloon’s, 11Big Bazaars and 2 Food Bazaar’s has already been finalized, and these would be Operational over the next two years. PRIL aims to set up over 30 Food Bazaar’s and is scouting for appropriate locations for the same. After popularizing the concept of hypermarket in India, PRIL is now also setting up a new format shopping mall in the country under the name ‘Central’. The format would be on the lines of a Selfridhes in London or a Central Mall in Bangkok. Two malls of 100,000 and 240,000 sq.ft. are being set up in Bangalore and Hyderabad respectively. Diversity of product range will ensure profitable volume growth To achieve better return on retail space, PRIL uses certain product categories as margin managers and certain product categories to generate traffic. The food and groceries business will act as key volume growth driver while high share of apparel (which account for over 80% sales in Pantaloon Stores and 40% in Big Bazaar) will enable PRIL to maintain high margins. The management has demonstrated its ability to improve stock turnovers in both the formats successfully, which has enabled significant margin improvement. Fully integrated value chain and own labels give competitive edge PRIL has a completely integrated value chain in apparels from fabric manufacturing to apparel manufacturing, branding, distribution to retailing. The company controls the total value chain from yarn to apparel retailing and gives a competitive edge in terms of speed of
delivery; lower inventory carrying costs and better realizations. Also, large part of PRIL’s apparel revenues comes from own private labels. PRIL has developed significant competencies in apparel branding over a period of time and has developed own labels (John Miller, Shrishti, Bare, Annabelle, AFL) in all the apparel product categories. Worldwide, private labels give higher margin to retailers than the national brands.Also growth of private labels is faster as retailer controls shelf space and visibility. Other initiatives such as faster turnover of stocks by introducing 6 seasons in a year (against 2 earlier) has helped in bringing down inventory levels and at the same time providing wider choice to customer and improving frequency of customer visits.
High scalability of business model- multiplier effect will set in
Size and scale drive economies on procurement and lower logistics costs, which enables a retailer to deliver better value to customers. The hyper-market format has much higher scalability as compared to the pure apparel-retailing format. Also, the potential to expand and scale is virtually unlimited in the food & grocery segment, where efficiencies improve dramatically with scale as the multiplier effect sets in. Food constitutes the largest expenditure item (estimated at over 50%) of an average Indian’s monthly personal expenditure. However, the share of modern retail formats in the Rs6700bn Food & Grocery market is a minuscule 0.3%, revealing the high growth potential in the segment. New product categories and innovative tie-ups to aid growth PRIL offers large number of products to the customer to give them better choice for selection. Different product categories have different depth and width in merchandise offering. Besides, PRIL has tied up with Shop-in-Shop partners in its Big Bazaar stores. Some product categories where the company does not have core competency or does not want to invest, but would attract customers are catered through these partners. Eventually, in the long run, the Company may manage some of these product categories on its own as volumes grow and it develops competencies in these businesses. Shop-in-Shop partners typically pay a fixed rental for their space and share a part of their profits. By expanding the range of product offerings and retail formats, PRIL today has been able to target a much larger share of the consumer’s basket (about 70% as against less than 8% in 1994). PRIL will be adding new product categories to its business in both Pantaloons as well as Big Bazaar stores. Gold, Investment products, White goods and Appliances, Footwear will be
the new product categories that will be added. These product categories will help in improving Walk In’s into its stores and generate additional business from the existing categories too. Competition from global players would pose a major threat Most global retailing majors have been keen on entering into the huge untapped Indian market. However policy restricts Direct Foreign Investment in the sector. There is a high likelihood of the Government lifting restriction on FDI into the retail sector in the near future. Entry of these foreign giants - with significant experience and skills in retail management would increase competition for PRIL. However, we believe that given the widely dispersed and heterogeneous nature of Indian markets, a foreign entrant would find it extremely difficult to establish a national presence. Pantaloon with its early mover advantage and understanding of local markets is well entrenched to retain high customer share. Pantaloon Retail (India) Limited (PRIL) was incorporated on October 12, 1987 as Menz Wear Private Limited under the stewardship of Mr. Kishore Biyani. It was converted into a public limited company in September, 1991. The company sold branded garments under Pantaloon, Bare and John Miller brands. PRIL set up its first menswear Pantaloon Shoppe outlet in 1993. The company’s name was changed to Pantaloon Retail (India) Limited in 1999, when it made a full-fledged entry into the retail segment through the Pantaloons Family Store.
3.2 Pantaloon Retail (India) Ltd: A Company Snapshot
Pantaloon Retail (India) Ltd. The Company's principal activity is to operate chain retails stores in names of Big Bazaar, Food Bazaar, Central and Pantaloons. The Big Bazaar is the discount store which offers a wide range of products under one roof. The products include apparels and non-apparels such as utensils, sports goods and footwear. The Company also has its presence into gold retailing by launching Gold Bazaar. The Company's Food Bazaar provides a range of food and grocery products ranging from fresh fruits and vegetables, staples, FMCG products and ready-to-cook products. The Central offers a chain of stores including books and music stores, global brands in fashion, sports and lifestyle accessories, grocery store and restaurants. The Pantaloon retail stores focus largely apparels and accessories. About Pantaloon Retail (India) Ltd Pantaloon Retail (India) Limited is a leading retailer with a turnover of Rs. 1088 crores for the financial year ending June 2008. The company is headquartered in Mumbai and has a presence in Lifestyle Retailing through 18 Pantaloons Stores, 3 Central Malls in Bangalore, Hyderabad and Pune. In Value Retailing it is present through 24 Big Bazaar hypermarkets, 38 Food Bazaars and 2 Fashion Stations. PRIL has a national presence with 2.6 million square feet of retail space across 24 cities.
3.2.1 Pantaloon: Fashion by Pantaloon Pantaloon is the company's departmental store and part of life style retail format. In fact, PRIL took its very initial steps in the retail journey by setting up the first Pantaloon store in Kolkata in 1997. In a short time Pantaloon has been able to carve a special place for it self in the hearts and minds of the aspirational Indian customers. The company has depth of offering for both men and women at affordable prices. A striking characteristic of Pantaloon has been the strength of its private label programme. John Miller, Ajile. Scottsvile, Lombard, Annabelle are some of the successful brands created by the company. With 13 stores across the country and an ever-increasing stable of private brands, Pantaloon - in the coming years is poised to become a leading fashion trendsetter. 3.2.2 Big Bazaar: Is se sasta aur acha kahin nahin Big bazaar is the company’s foray into the world of hypermarket discount stores, the first of its kind in India. Price and the wide array of products are the USP’s in Big Bazaar. Close to two lakh products are available under one roof at prices lower by 2 to 60 per cent over the corresponding market prices. The high quality of service, good ambience, implicit guarantees and continuous discount programmes have helped in changing the face of the Indian retailing industry. A leading foreign broking house compared the rush at Big Bazaar to that of a local suburban train. Food Bazaar’s core concept is to create a blend of a typical Indian Bazaar and International supermarket atmosphere with the objective of giving the customer all the advantages of Quality, Range and Price associated with large format stores and also the comfort to See, Touch and Feel the products. The company has recently launched an aggressive private label programme with its own brands of tea, salt, spices, pulses, jams, ketchups etc. With unbeatable prices and vast variety (there are 42 varieties of rice on sale), Food Bazaar has proved to be a hit with customers all over the country.
104 outlets Located in India
Parent group Owner Founded Head quarter Industry Website Tag line Figure 3.1: About Big Bazaar Big Bazaar
Future group Kishore Biyani (CEO) 2001 Jogeswari , Mumbai Retail www.bigbazar.com Is se sasta aur achha kahin nahi.
Big Bazaar is a chain of shopping malls in India, owned by the Pantaloon Group and which work on Wal-Mart type economies of scale. They have had considerable success in many Indian cities and small towns. Big Bazaar provides quality items but at an affordable price. It is a very innovative idea and this hypermarket has almost anything under one roof Apparel, Footwear, Toys, Household Appliances and more. The ambience and customer care adds on to the shopping experience. Is Se Sasta Aur Accha Kahin Nahin !
What's in store for you at Big Bazaar? 1,70,000 products at 6- 60 % discount. At Big Bazaar, you will get: A wide range of products at 6 – 60 % lower than the corresponding market price, coupled with an international shopping experience.
3.3 Products available in Big bazaar
Apparel and Accessories for Men, Women and Children. Baby Accessories. Cosmetics Crockery Electrical Accessories Electronics Footwear Toys Home Textiles Home Needs Household Plastics Hardware Home Decor Luggage Linens Sarees Stationery Utensils & Utilities
Dress Materials Suiting & Shirting Household Appliances
Food Bazaar’s core concept is to create a blend of a typical Indian Bazaar and International supermarket atmosphere with the objective of giving the customer all the advantages of quality, Range and Price associated with large format stores and also the comfort to See, Touch, and Feel the products. 'FOOD BAZAAR' a division of Pantaloon Retail India Ltd is a chain of large supermarkets with a difference. It was flagged off
in April'02. With store sizes ranging from 8,000 sq ft to 15,000 sq. ft. in Mumbai (two stores), Kolkata, Bangalore & Hyderabad, it is opening more stores at Gurgaon (Delhi), New Bombay & Nagpur. It currently caters to over 1.2 million customers every day across 4 outlets in India and is soon set to expand and double this figure across 12 outlets all over the country by June 2009. Food Bazaar offers the Indian consumer the best of Western and Indian values. The western values of convenience, cleanliness and hygiene are offered through pre packed commodities and the Indian values of "See- Touch- Feel" are offered through the “Mandi” atmosphere created by displaying staples out in the open, all at very economical and affordable prices without any compromise on quality. This satisfies the Indian consumer and comforts her before making her final buying decision. At other super markets, the consumer is deprived of this factor. Truly the Indian consumer now agrees with Food Bazaar: "Ab Ghar Chalaana kitna Aasaan”. This positioning platform of Food Bazaar is evident from the higher discounts and the wholesale price-points which are below MRP. Food Bazaar represents the company’s entry into food retail and is targeted across all classes of population, tea, sugar, pulses, spices, rice wheat etc, besides fruits and vegetables. All products are sold below MRP and discounts range between 2% to 20%. Fruits and vegetables are sold at prices comparable to wholesale prices. Food Bazaar replicates a local ‘mandi’, to provide the much important ‘touch & feel’ factor which Indian housewives are used to in the local bazaar. Food Bazaar has over 50,000 stock keeping units which cover grocery, FMCG products, milk products, juices, spices, ready to eat foods etc.
3.4 GROUP VISION AND MISSION:
Group Vision Future Group shall deliver Everything, Everywhere, Every time for Every Indian Consumer in the most profitable manner Group Mission We share the vision and belief that our customers and stakeholders shall be served only by creating and executing future scenarios in the consumption space leading to economic development. We will be the trendsetters in evolving delivery formats, creating retail realty, making consumption affordable for all customer segments – for classes and for masses. We shall infuse Indian brands with confidence and renewed ambition. We shall be efficient, cost- conscious and committed to quality in whatever we do. We shall ensure that our positive attitude, sincerity, humility and united determination shall be the driving force to make us successful.
Indianness: confidence in ourselves. Leadership: to be a leader, both in thought and business. Respect & Humility: to respect every individual and be humble in our conduct. Introspection: leading to purposeful thinking. Openness: to be open and receptive to new ideas, knowledge and information. Valuing and Nurturing Relationships: to build long term relationships. Simplicity & Positivity: Simplicity and positivity in our thought, business and action. Adaptability: to be flexible and adaptable, to meet challenges.
Flow: to respect and understand the universal laws of nature.
3.4.1 AWARDS AND RECOGNITION 2009 CNBC Awaaz Consumer Awards 2009, Images Fashion Forum 2009, Coca-Cola Golden Spoon Awards 2009 2008 Indian Retail Forum Awards 2008, The INDIASTAR Award 2008 , Retail Asia Pacific 500 Top Awards 2008, Coca-Cola Golden Spoon Awards 2008, The Reid & Taylor Awards For Retail Excellence 2008 2007 Images Retail Awards, National Retail Federation Awards, World Retail Congress Awards, Hewitt Best Employers 2007, PC World Indian Website Awards Reader’s Digest Trusted Brands Platinum Awards. 2006 Retail Asia Pacific Top 500 Awards, Asia money Awards, Ernst & Young Entrepreneur of the Year Award, CNBC Indian Business Leaders Awards, Lakshmipat Singhania – IIM Lucknow National Leadership Awards, Images Retail Awards , Readers’ Digest Awards , CNBC Awaaz Consumer Awards, Reid & Taylor Awards for Retail Excellence 2005 Images Retail Awards 2005, DAKS London 2004 Images Retail Awards 2004, Reid & Taylor and DLF Awards 2003 Indian Express Award
3.4.2 SWOT ANALYSIS:
Strengths:• • • • • • • • • • EDLP [ Every Day Low Pricing] Experienced marketing team & executive staff. Strong culture, ethics and values are followed Emphasis on providing total customer satisfaction Point of purchase promotion to increase the purchase Variety of stuff under single roof Increase sales with the help of healthy competition between different department Maintains good employer-employee relation Cost control initiatives that is critical in a retail operations business Periodical reviews of the various operations have been done on regular basis to identify the any possible threat and address the same within time Weakness:• • Unable to meet store opening targets. Unavailability of popular brand items with regard to clothing.
Population of the country is growing where the scope of market is kept on increasing for the retail sector. Organized Retail less penetrated in India so it acts as a great opportunity to the organization for its growth. Evolving consumer preferences. Economy is developing as the employment opportunities are increasing and the income of the people is also increasing which increases life standards of people. Company has more scope of expansion in two and three tier cities.
• • •
Threats:• • • •
Competitors Strategies Advancement of technology day by day. Government policies. Unorganized Retail sector Foreign direct investment cause more problems in future because of that many mergers and acquisition are happening in Indian retail sector
3.4.3 A layout chart of Big bazaar located at PIMPERI CHINCHWAD
1. HELP DESK 2. KIDS ACCESSORIES 3. BABA SUITS 4. JACKETS 5. LADIES TOPS 6. TRIAL ROOM 7. PILLARS USED FOR DISPLAYING INFORMATION (SIZE CHART, SECTION DESCRIPTION) 8. WOOLEN CLOTHS FOR KIDS 9. KIDS CASUAL WEAR 10. KIDS JEANS AND SHORTS 11. LADIES ETHINIC 12. LADIES ACCESSORIES – LINGERIES 13. LADIES WESTERN 14. MEN FORMAL SHIRTS 15. MEN TROUSERS 16. MEN SUITS AND BLAZERS 17. MEN FABRICS 18. MEN ETHINICS
19. SOFT TOYS 20. MEN ACCESSORIES – SUNGLASSES, WRIST WATCHES ETC 21. HOME DECORATIVE ITEMS 22. HOME FURNISHING (CURTAIN CLOTHS, CARPETS) 23. MUSIC COUNTER 24. LUGGAGE 25. FOOTWEAR 26. SPORTS 27. SCHEME BASED PROMOTIONAL ITEMS 28. FURNITURE BAZAR 29. FOOD BAZAAR 30. CASH COUNTER
4.1 Retail Mix
The retail mix is the combination of factors retail used to satisfied customer needs and influences their purchase decision. It’s include the type of merchandise and services offered, merchandise pricing, advertising, promotional programs store design merchandise display, assistance to customer provided by salespeople, and convenience of the store’s location.
Retail mix is the term used to describe the various elements and methods required to formulate and execute retail marketing strategy.
Retail managers must determine the optimum mix of retailing activities and coordinate the elements of the mix. The aim of such coordination is for each store to have a distinct retail image in consumers mind. The mix may vary greatly according to the type of the retailer is in, and the type of product/services. While many elements may make up a firm’s retail mix, the essential elements may include: Store location, merchandise assortments Store ambience, customer service, price, Communication with customer Personal selling Store image Store design Sales incentives People Process Physical evidence
4.1.1 Composition of retail mix Place Product Price Promotion People Process Physical Environment Key element Table 4.1: Composition of Retail Mix
1) Place (store location) • • • • • Target market Channel structure Channel management Retailer image Retail logistics Retail distribution
2) Product (merchandise) • • • • • Product development Product management Product features and benefits Branding Packaging
3) Price • • • • • • • • Costs Profitability Value for money Competitiveness Incentives Quality Status After-sales services
4) Promotion • • • • • • Developing promotional mixes Advertising management Sales promotion Sales management Public relations Direct marketing
5) People element • • • • • • Staff capability Efficiency Availability Effectiveness Customer interaction Internal marketing
6) Process element • • • • • Order processing Database management Service delivery Queuing system Standardization
4.1.2 Retail mix planning Retail mix plan consists of: Setting objectives Systematic way of identifying a range of options. Formulation of plans for achieving goals Logical sequence of retailing activities. Importance of Retail mix planning Hostile and complex retail environment External and internal retail organisation factors interact for · · · ·
Maximising revenue Maximising profit Maximising return on investment Minimising costs
Each element has conflicting needs
All these variables interact All these variables result in optimum compromise. Approaches to planning Top down approach
Retail management sets goals and plans for all levels of management. Bottom up approach Various units prepare own goals and plans sent up for approval. It is the effective blending of all the elements of retail mix activities within the retail organization that determines the success of retail management. Discuss this statement and explain with retail examples how the elements of retail mix could be blended to ensure the success of retail operation.
Retailing is the sale of goods and services to ultimate consumers for personal, nonbusiness use. Any institution may engage in retailing, but a firm engage primarily in retailing is called a retailer. Retailers serve as purchasing agents for consumer and as sales specialists for producers and wholesaling middleman. They perform many specific activities such as anticipating consumers' wants, developing product assortments and financing. Retailers may be classified by form of ownership and key marketing strategies. Also, types of retailers distinguished according to product assortment, price and customer service levels. Mature institutions such as department stores, discount houses and super markets face strong challenges from new competitors, particularly chain stores or multiple shops in various product categories. Five major forms of non store retailing are Direct selling, Telemarketing, Automatic vending, On line retailing and Direct marketing .Each type has advantages as well as drawbacks.
4.2.1 Retail Marketing Mix Whatever is from of ownership, a retailer must develop marketing mix strategies to succeed in its chosen target markets. In retailing, the marketing mix emphasizes product assortment, price, location, promotion and customer services designed to aid in the sale of a product. They include credit, delivery, gift wrapping, product installation, merchandise returns, store hours, parking and- very important personal service. Stores of different sizes face distinct challenges and opportunities. Buying, Promotion, Staffing and expense control are influenced significantly by whether store's sales volume is large or small. Size of a retail
business creates certain merits and demerits. Considering these factors, large stores ordinarily but not always have a competitive advantage over small stores.
4.3 Competitive Advantage with Special Reference to Physical Facilities
Another competitive advantage of retailers will be how they create physical facilities which represent the distribution element of a retailer's marketing mix. Some firms engage in non-store retailing by selling on hire or through catalogs or door to door, for example-but many more firms rely on retail stores. Firms that operate retail stores must consider four aspects of physical facilities. Location It is frequently stated that there are three keys to success in retailing: Location, Location, Location! Although overstated, this axiom does suggest the importance that retailers attach to location. Thus a stores site should be the first decision made about facilities. Considerations such as surrounding population, traffic and cost determine where a store should be located. Size This factor means the total square footage of the physical store, not the magnitude of the firm operating the store. These are much different factors. A firm may be quite large with respect to total sales, but each of its outlets may be only several thousand square feet in size. Design This factor refers to a stores appearance, both interior and exterior over its competitor. Layout The amount of space allocated to various product lines, specific locations of products and a floor plan of display tables and racks comprise the store's layout. As would
be expected, the location, size, design and layout of retail stores are based on where consumers live and how they like to go about their shopping. Consequently, the bulk of retail sales occur in urban, rather than rural, areas. And suburban shopping areas have become more and more popular, where as many down town areas have declined.
Assessing Competitors Current Strategies The first part in competitor analysis is to determine how competitors are attempting to achieve their objectives. This question is addressed by examining their past and current marketing strategies. 4.3.1 Marketing Strategy Many authors have attempted to explain the concept of strategy. At the retail level, a marketing strategy can be thought of three major components: target selection of customers, core strategy (i.e. positioning and differential advantage), and implementation (i.e. supporting marketing mix). The first major component is the description of the market segment(s) to which competing brands are being marketed. Market segments can be described in various ways. Since few brands are truly mass marketed, the key is to determine which group each competitor has targeted. The second strategy component is what is called the core strategy. This is the basis on which the rival is competing, that is its key claimed differential advantage(s).Differential advantage is a critical component of strategy because it usually forms the basic selling proposition around which the brand's communications are formed. It is also called the brand's positioning. The final strategy component of competitors must be assessed in the supporting marketing mix. The mix provides insight into the basic strategy of the competitor and specific tactical decisions. These decisions are what customers actually see in the market place. In fact, customers are exposed to price, advertising, promotion and other marketing mix elements. 4.3.2 Marketing Environment To the company's marketers falls the major responsibility for identifying major changes in the environment. The retail environment, in particular is constantly spinning out new opportunities, in bad as well as in good years. The general marketing environment also spins out new threats-such as an energy crisis, a sharp rise in interest rates, a deep recession44
and firms find their markets collapsing. Recent times have been marked by many sudden changes in the marketing environment, leading Drucker to dub it an Age of Discontinuity and Toffler to describe it as a time of Future Shock. Retail marketers need to continuously monitor the changing scene. They must use their intelligence and marketing research to track the changing environment. By erecting early warning systems, retailers will be able to revise marketing strategies in time to meet new challenges and opportunities in the environment. It consists of the external actors and forces that affect the retailer’s ability to develop and maintain successful transactions and relationships with its target customers. We can distinguish between the retailers' micro environment and macro environment. The micro environment consists of the actors in the retailer's immediate achievement that affects its ability to serve its markets: Suppliers, intermediaries, customers, competitors and publics. The macro environment consists of legal, social, economic and technological forces.
4.3.3 Store location and Layout Retailers want to locate their stores in the best place possible. The best place possible will vary from retailer to retailer depending on the industry type, type of product, competition, and other market factors. Basically a retail store has to located where the market opportunities are at optimal levels. There are basic guidelines that most retailers examine before choosing a new location. First, the retailer must select a country or region and then define the boundaries of the trade area and evaluate its population characteristics against the retailers target market. The buying power of the area must be considered along with its market and sales potential. The size, location, and type of competition must also be taken into account. The local legal and political environment must be examined along with the leasing costs and occupancy rates. The actual physical features of the location – such as available space, traffic and access to the site, and surrounding buildings – play a role in the selection process. Retailers possess many tools to help in the site selection decision. Reilly’s law and Huff’s model can aid in defining the trade area. Market segmentation and demographic segmentation provides clues to population characteristics. The buying power index and effective buying income suggest strength of the economic base while the index of retail saturation offers a benchmark for market comparison. Changes in consumer lifestyle will require new strategies for selecting retailing locations, such as the increasing use of convenience oriented sites, the integration of food and non-food retailing, and the placement
of retail merchandising in amusement parks. There a numerous kind of retail stores to choose from as well. Most potential sites fall in to one of these categories: business districts, shopping canters, and freestanding locations. There are specific advantages and disadvantages for each type of location. The bottom line in retail site selection should be to choose a location that will fit both today’s and tomorrow’s needs. The layout and design of a retail store communicate a significant amount of information about the retailer to the consumer. The architectural character of the store, building a new location, renovating existing facilities, exterior design, interior design the modern self layout and the image of the store are the key issues in designing a layout for a store. 4.3.4 Merchandise Management Merchandise management can be termed as the analysis, planning, acquisition, handling and control of the merchandise investments of a retail operation. The process of merchandise management includes the developing of strategies to ensure that the right product is bought at the right price and available at the right place, at the right time, in the right amount, in order to satisfy the needs of the target customer. No one in retail can completely avoid any contact with merchandising activities. Merchandising is the day-today business of all retailers. As inventory is sold, new stock needs to be purchased, displayed and sold. Hence, merchandising is often said to be at the core of retail management. Merchandising traces its growth to the rise of organized retail in the world. Initially, as the retailers operated only one or two stores, the function of buying the merchandise, pricing it, etc., were much simpler. In many cases, the retailer did it himself. However, as retailers started adding stores and categories, the workload on the buyers increased significantly. Often, buyers had little information or time and they ended up using approximations based on sales volumes, to allocate merchandise between stores. This sometimes, resulted in stores exchanging merchandise among them! In order to overcome this limitation, the function of a planner came into being. The planner’s job was to act as a link between the stores and the buyer. The de-linking of the function of planning and buying allowed better interaction with the stores. Planners were able to devote more time to collecting and studying store level data, the buyers on the other hand, were able to spend more time with the vendors.
4.4 Competitive Sales Given widespread availability of the same brands, retailers have to cope with the phenomenon of discounts. The retailers themselves dilute the strength of the retail market. With promotions becoming the order of the day, they have entered into price wars against each other. ‘Up to 50 percent off’ sales and ‘Two for one’ price offers have now become commonplace even at the top retail outlets across our country. Every season every festival has more price cuts. The discounted buying has become an annual market strategy rather than a mere sales promotion for a few weeks. Deep price cuts may not be the answer to maintain their relevance against the small retailers nor does it augur well for the brand building of the store.
5.1 Research title:
The title of the research project is: “Effectiveness of Retailing Mix for Customer Satisfaction at Big Bazaar.”
5.2 Research Problem:
What is effectiveness of Retailing Mix at Big Bazaar leading to Customer Satisfaction?
5.3 Research Objective:
Primary objectives: To identify performance of store operations.
To analyze how the merchandising mix influence the customer satisfaction
Secondary objectives: To understand the quality of service maintained in the store. To determine the performance of sales persons in the store. To find out reasons of dis-satisfaction.
To find out which means of communication plays a vital role to persuade customer.
5.4 Scope of study
The study makes an effort to ascertain the satisfaction level of customers from the store environment and analyze the impact of retailing mix on the customer satisfaction level, and to improve the store environment to increase the sales and to attract the customers. The company can come up to the expectation only by finding out the problem that customers are facing during their purchase from the store. The subject has been taken for the research as it plays key role in success of retail sector. As long as the company is able to satisfy its customer, customer will remain in the bracket of loyal customer. This study helps to improve the environment of the store to reach the customer satisfaction level and improve the merchandising in Big Bazaar.
6.1 Objectives of Research:
The purpose of research is to discover answers to questions through the application of scientific procedures. The main aim of research is to find out the truth which is hidden and which has not been discovered as yet. Though each research study has its own specific purpose, we may think of research objectives as falling into a number of following broad groupings: To gain familiarity with a phenomenon or to achieve new insights into it (studies with this object in view are termed as exploratory or formulative research studies); To portray accurately the characteristics of a particular individual, situation or a group (studies with this object in view are known as descriptive research studies); To determine the frequency with which something occurs or with which it is associated with something else (studies with this object in view are known as diagnostic research studies);
6.2 Research Design:
Research design is an arrangement of condition for collection and analysis of data in a manner that aims to combine relevance to research purpose with an economy in procedure. Research design is needed because it facilitates the smooth ailing of the various research operations, thereby making research efficient possible yielding maximal information with minimal expenditure. Research design used in this project is Single Cross-sectional design where one sample is drawn from a population of interest. In this research design a cross
sectional study is concerned with a sample of elements from a given population. Data on a number of characteristics from the sample elements are collected and analyzed.
6.3 Types of Research:
Exploratory research: The research is an exploratory when; one is seeking insight to general nature of the problem, the possible alternatives and relevant variables that need to be considered. The methods are flexible, unstructured and qualitative. Descriptive research: It provides an accurate position of a particular aspect of the market environment. The purpose of descriptive research is together a quantified measurement of a specific reaction. It is structured. Most of the data that we needed are gathered in some form of direct or indirect question which further will depend upon: Nature of the question Time frame of study Funds available Kinds of respondents This project is totally based on survey of the market i.e. people and a lot of research on the web, so for that a DESCRIPTIVE type of research design was used. Descriptive research provides an accurate position of a particular aspect of the market condition. The purpose of this research is together quantified measurement of a specific type of reaction. It is a structure most of the data that we collected from the field are gathered in some form of direct or indirect question.
6.4. Data Collection Methodology:
The primary data are those, which are collected afresh and for first time and thus happen to be original in character. The secondary are those which have been collected by someone else and which have already been passed through statistical process. Data has been collected by the researcher by Primary sources such as questionnaire and personnel interview. It included 20 questions and 100 customers were given the questionnaire and response was taken from them. Charts and graphs will be used for presentation of data for easy understanding and interpretation.
6.5 Data Collection Instruments:
1. Questionnaires 2. Personal Interviews. 6.5.1 Designing the Questionnaire: While designing the Questionnaires certain things were kept in mind such as simplicity, length and clarity. 6.5.2 Personal Interviews Personal interview is mostly commonly used method of data collection. Two purposive communications between interviewer (researcher) and the respondent (subject) aimed at obtaining and recording information pertinent to the subject matter of study. The interviewer resents oral, verbal and written stimuli and receives oral resonances.
6.6 About the Survey:
6.6.1 Survey Title: “Effectiveness of Retailing Mix for Customer Satisfaction at Big Bazaar”. 6.6.2 Sample Universe: Big Bazaar Store
6.6.3 Sampling Method: Non-probability sampling was used .Non-probability sampling is that sampling procedure which does not afford any basis for estimating probability that each item in population has being included in the sample. Under non-probability sampling organizers of enquiry purposely select particular unit of universe for constituting a sample on the basis of the small mass that they so select out of huge one will be typical or representative of the whole. Adequate consideration was taken to bring a heterogeneous group in terms of age, income, occupation etc. to make the results credible. 6.6.4 Sample Size: 100 Respondents.
7.1 Analysis Techniques:
Time: The survey of 100 respondents was finished in two months. Response Format: The questions are a mix of open-ended, close-ended questions, binary, ranking and multiple choice questions. They have been so inserted into the questionnaire, to get the appropriate response for a particular situation.
7.2 Limitations of the study:
Time Constraint: Analysis pertaining to project title and the field survey
has to be done in a span of two months. This may limit the scope of the survey.
Biasness: The respondents may give a biased view.
Some respondents refuse to co-operate. Some respondents replied half heartedly.
Some respondents gave incomplete information.
7.3 Survey Results, Presentation and Inference
Effectiveness of Retailing Mix for Customer satisfaction at Big Bazaar Question 1a): Do you frequently shop at big bazaar? Table No.7.1: No of customer Yes 74 No 26 Total 100
Figure No.7.1: No of customers
Inference: From the above chart we can ascertain that majority of customers i.e., around 74% of sample customers frequently visits to the store and 26% of the customer visits the store rarely.
Question 1b): How frequently do you shop at big bazaar?
TableNo.7.2: Customer Response Sr.No. 1. 2. 3. 4. Response Every week Once in two week Once in three week Once in month No. of customers 38 24 16 22
Figure No.7.2: Customer Response
Inference: From the above table we can analyze that the majority of the customers i.e. 38 out of 100 customer visits store every week , followed by 24 customer once in two week. Thus we can say that majority of customer visit big bazaar every week, may be during weekends. We can conclude that the customer visit Big Bazaar for their weekly purchase.
Question 2a): What comes to your mind when you think about big bazaar? Table.No.7.3: Unique Selling Propositions of big bazaar
Sr.No. 1. 2. 3. 4. 5. 6.
USP’s Discount Product Variety Brand Quality Free offer Others
No. of customers 34 24 4 8 28 2
Figure No.7.3: Unique Selling Propositions of big bazaar
Inference: From the data collected we can determine that among 5 USP’s of big bazaar most recognised are discounts and free offers, along with that it also recognised for product varieties. But they have to rethink about the brand available in the store and they have to expand their brand availability. Question 2b): Do you feel that you find different variety of product in Big Bazaar? Table No.7.4: No of customer Yes
Figure No.7.4: Product Variety
Inference: From the above chart we can asertain that upto 66% percent i.e. majority of customers satisfied with the variety of product in the store.
Question 2c): Do you find the specific brand that; you look in the big bazaar? Table No.7.5: No. of Customers Yes 37
Figure No.7.5: No. of Customers
Inference: From the above chart we can ascertain that 63% of customers find it difficult to get specific brand. Mostly customers were not satisfied with brand availability in apparels section.
Question 3: In which section do you spend more time while shopping? Table No.7.6: Customer Response Sr.No. 1. Response Food bazaar
No. of Customers 36
2. 3. 4.
Apparels Utensils Other
21 28 15
Figure No.7.6: Customer Response
Inference: Most of the customer who visits to the Big Bazaar, would like to visit to the food bazaar first which means it shows customer preference towards food bazaar followed by House hold utensils section as they find more products varieties and offers in these sections.
Question 4: Do you think this store has good parking facilities? TableNo.7.7: Parking Facilities Sr.No. 1. 2. Response Yes No No. of Customers 52 48
Figure No.7.7: Parking Facilities
Inference: From the data, we conclude that still 48% of customers are not satisfied with the parking facilities as they have to wait for long time to park their vehicle because of full parking.
Question 5: How is the ambiance of floor inside the store? Table No.7.8: Store Ambiance
Sr.No. 1. 2. 3. 4.
Response Excellent Good Average Bad
No. of Customers 17 31 44 8
Figure No.7.8: Store Ambience
Inference: From the data collected with this question, 44 out of 100 customer to respond about cleaning of store is ok, 8 customer’s respond is bad, 17 customer’s is excellent, and 31 customer’s respond is good, most of the customers were not satisfied with cleanliness and temperature maintained in the store. There is need to improve cleanliness.
Question 6: How do you feel about sales persons and promoters? Table No.7.9: Sales persons and promoters behavior
Sr.No. 1. 2. 3. 4.
Response Excellent Good Average Bad
No. of Customers 17 22 29 32
Figure No.7.9: Sales persons and promoters behavior
Inference: From the above data we can conclude that 62% of customers feel the behavior of sales person and promoters is from average to bad. Customers are not satisfied with sales person and promoter’s behavior as there interaction is very less with customers.
Question 7: How is billing process? Table No.7.10: Billing Process
Sr.No. 1. 2. 3. 4.
Response Excellent Good Average Bad
No. of Customers 12 23 27 38
Figure no 7.10: Billing Process
Inference: From the above data we can conclude that 38% of customers are not satisfied with billing facilities.
Question 8: Do you feel that Big Bazaar provides you value for money? TableNo.7.11: Value for Money Sr.No. 1. 2. Response Yes No No. of Customers 87 13
Figure No.7.11: Value for Money
Inference: From the above data, we come to know that majority of the customer said that they are really getting value for there money. “Discovering More Value” The above statement is truly spotted by the above data
Question 9: The cleanliness and hygiene maintained in the store isTable No.7.12: Cleanliness and Hygiene Sr. No. 1. 2. 3. 4. Response Excellent Good Average Bad No. of customers: 6 24 38 32
Figure No.7.12: Cleanliness and Hygiene
Inference: From the above data, we come to know that most of customers i.e. 70% of customers are not satisfied with cleanliness maintained in the store.
Question 10: Product display and signage in the store isTable No.7.13: Product display and Signage Sr.No. 1. Good 2. 3. 4. Average Bad 18 58 13 Response Excellent No. of customers 11
Figure No.7.13: Product display and Signage
Inference: From the above data, we can conclude that most of customers marked product display and signage as average to bad and expect improvement so that they can easily find what they want.
Question 11: Location of Big Bazaar in your city isTable No.7.14: Location of Store Sr.No. 1. Good 2. 3. 4. Average Bad 31 9 6 Response Excellent No. of customers 38
Figure No.14: Location of Store
Inference: From the above data we can conclude that 69% of customers feel that location of store is excellent to good.
Question 12: The store layout at this store makes it easy for customers to move around the store and find what they want? Table No.15: Store Layout Sr. No. 1. 2. 3. 4. 5. Response Strongly Disagree Somewhat Disagree Neutral Somewhat Agree Strongly Agree No. of customers: 13 28 41 11 7
Inference: From the above data we can conclude that 41% of customers feel store layout is not up to mark and still more 41% customers not able to categories as good.
Question 13: Through which promotional source you come to know about Big Bazaar? Table No.16: Promotional Source Sr. No. 1. 2. 3. 4. Response Print Media Electronic Media Word of Mouth Magazine No. of customers: 33 32 24 11
Figure No. 16: Promotional Source
Inference: From the above data we can conclude that Most of customers came to know about Big bazaar by Electronic Media (32%) and Print Media (33%). 24% of customers came to know by word of mouth.
Question 14: Which type of media appeals you more for purchasing from Big Bazaar? Table No.17: Promotional Media Sr. No. 1. 2. 3. 4. Response Print Media Electronic Media Word of Mouth Magazine No. of customers: 27 23 36 14
Figure No.17: Promotional Media
Inference: From the above data we can conclude that 36% customers feel word of mouth plays a major role in their decision making.
Question 15: How much do you think that the promotional activities help in making your shopping beneficial? Table No 18: Promotional Activities Sr. No. 1. 2. 3. 4. 5. Response To great Extent(1) 2 3 4 Not Much(5) No. of customers: 27 35 24 12 2
Figure No.18: Promotional Activities
Inference: From the above data we can conclude that Promotional scheme is beneficial in making shopping easy. 27 customers ranked it at scale of great extend. 24 believe that it is effective where as 37 said it is most effective and need this type of information before actual purchase.
Question 16: Which of the following service you have used most frequently?
Table No.7.19: Service used by customers most frequently Sr.No. 1. 2. 3. 4. 5. 6. 7. 8. Service Home delivery Exchange Gift Hampers Baggage Counter Parking Helpline Alteration Other No. of customers: 23 10 6 78 51 4 8 2
Figure No.7.19: Service used by customers
Inference: Above chart indicate that, most of customers use Baggage and Parking facility. Very few customers use helpline, alteration and other facilities where as Home delivery, exchange and gift hamper service attracts some customers.
Observations & Finding
Store is performing well in attracting the customers. Most of the people who visit to the stores are of age group between 22-45 yrs. People usually visit the store once in a week i.e. in weekends They have different variety of product in food bazaar and house hold utensils The main dissatisfaction for the customer is in the billing section and at parking space. Discounts and offers are doing well in the store. Most of the customers who visit stores are having annual income between Rs.1.5-3 lac. Inside the store, employee’s interaction is very less with customers. Location of Big Bazaar is outstanding.
Cleanliness and hygiene maintained in the store is not up to mark. Big Bazaar provides value added service like home delivery, alteration, helpline etc.
but very few customers go for it. Electronic and print media has high reach in consumer and plays a major role in communication about promotional scheme and offers where as word of mouth make significant impact in decision making than any other means of communication. Customers don’t find brands they expect in Big Bazaar especially in apparels section.
Big Bazaar offers a wide variety of products of different prices and different qualities satisfying most of its customers.
Prices and offers in Big Bazaar have been one of the main attractions and reasons for its popularity. The price ranges and the products offered are very satisfying to the customers.
Considering the fact that there are huge middle class families in India, Big bazaar
has had a huge impact on the middle class section of India, the prices, variety and sales strategy has helped in getting the middle income groups getting attracted towards Big Bazaar.
The store layout and the assortment of goods is not the best at Big Bazaar, Customers find it hard to find what they require; this leads to dissatisfaction of customers.
Big Bazaar is not acclaimed for high class service. The staffs recruited is not very well trained and the billing queues take a long time to move, this irritates customers which makes them visit the store more seldom.
The customer get all kind of products in the Big Bazaar, i.e. they are following good merchandising mix, but in some section like apparels they have to keep different brands in order to attract more customer.
Word of mouth publicity played major role in making Big Bazaar so popular where as media is used to communicate new offers at the store.
Customers are not aware and hence don’t avail value added services provided by the store.
Customers are more satisfied with the merchandising present in the food bazaar and household utensils section.
The following suggestion can be given to Big Bazaar
Keep brands like Koutons, Cotton County which is well known for offers.
Cleanliness and hygiene should be maintained regularly.
External environment like parking area should be increase as most of customers face
problem of parking specifically during rush hour.
The billing time should be reduced by increasing no. of cash counter keeping in
view customer traffic intensity. During rush hour, can make provision of less paying counter so customer who want to purchase single product need not to give up because of long queue. Store layout needs to be improved. Proper signage should be there so that customer can locate the products easily. Value added services have to be improved so that most of customers will avail those services.
References & Bibliography
1. Principles of Marketing – Philip Kotler and Gery Armstrong 2. How to Prepare for a Summer Project- Dr. Dilip M. Sarawate
3. Research Methodology - M.V. Kulkarni
Magazines: Business Today
www.wikipedia.com www.pantaloon.com www.Futuregroup.com www.Scribd.com a. www.ibef.org
Name – Gender- M ( ) E MailOccupationF( )
Age – Mobile No DateAnnual Income-
1. a) Do you frequently shop at big bazaar? A). Yes ( ) B). No ( )
b) How frequently do you shop at big bazaar? A) Every week ( ) C). once in three week ( ) B). Once in two week ( ) D). Once in a month ( )
2. a) What comes to your mind when you mean about big bazaar? A). Discount ( ) D). Quality ( ) B). Product variety ( ) E). Free offer ( ) C). Brand ( ) F). Others ( )
b) Do you feel that you find different variety of product in big bazaar? A). Yes ( ) B). No ( )
c) Do you find the specific brand that; you look in the big bazaar? A). Yes ( ) B). No ( )
3. In which section do you spend more time while shopping? A). Food bazaar ( ) C). Household utensils ( ) B). Apparels ( ) D). Other section ( )
4. Do you think, this store has good parking facilities? A). Yes ( ) B). No ( )
5. How is the ambiance of floor inside the store? A). Excellent ( ) B). Good ( ) C).Ok ( ) D). Bad ( )
6. How do you feel about sales persons and promoters ? A). Excellent ( ) B).Good ( ) C). Average ( ) D). Bad ( )
7. How is billing process? A). Excellent ( ) B). Good ( ) C). Average ( ) E). Bad ( )
8. Do you feel that Big Bazaar provide you value for money? A). Yes ( ) B). No ( )
9. The cleanliness and hygiene maintained in the store is89
A). Excellent ( )
B). Good( )
C). Ok ( )
D). Bad ( )
10. Product display and signage in the store isA). Excellent ( ) B). Good( ) C). Ok ( ) D). Bad ( )
11. Location of Big Bazaar in your city isA). Excellent ( ) B). Good( ) C). Ok ( ) D). Bad ( )
12. The store layout at this store makes it easy for customers to move around the store and find what they want? A) Strongly Disagree ( ) D) Somewhat Agree ( ) B) Somewhat Disagree ( ) E) Strongly Agree ( ) C) Neutral ( )
13. Through which promotional source you come to know about Big Bazaar? A). Print Media ( ) B). Word of Mouth ( ) B). Electronic Media ( ) C). Magazine ( )
14. Which type of media appeals you more for purchasing from Big Bazaar? A). Print Media ( ) B). Word of Mouth ( ) B). Electronic Media ( ) C). Magazine ( )
15. How much do you think that the promotional activities help in making your shopping Beneficial?
To great Extent
16. Which of the following service you have used most frequently? A). Home Delivery ( ) B). Exchange ( ) C). Gift hampers ( )
D) Baggage counter ( )
E) Parking ( )
F) Helpline ( )
G) Alteration ( )
H) Other ----------------------------------------------
Please give your experience
IBEC: Irish Business and Employees Confederation C&F: Carry and Forward
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