RETAIL SECTOR
OF SUKKUR
By: MONA
MUGHAL
HUNEZA SHAH
ABDUL Raheem
Tofique hyder
Ali Murad
MBA
3rdSemester
BUSINESS
RESEARCH
METHOD
Submitted to
Sir FAIZ SHAIKH
ABSTRACT
In this research paper, we take a peek into the organized retail sector of Sukkur. It
started making its presence felt nearly a decade after the first lot of entrepreneurs
set up shop. A brief introduction and evolution shows how the organized retailing
changed its gears over the period from. The market size and related details gives a
statistical view of increasing market in a few major areas of retailing. The changing
scenarios of Sukkur consumers give a proof to the potential opportunity in the
retailing arena. One major lifesaver of the Sukkur retailing is the advertising and
promotional strategies; which comes out with innovative ways to win consumers
over and keep them permanently happy.
• KEY WORDS: RETAIL TRENDS AND INDUSTRY IN SUKKUR ……………
• METHODOLOGY: DATA SECONDARY
INTRODUCTION AND EVOLUTION
The word ‘Retailing’ refers to any activity that involves the direct sale to an
individual customer or end user. Retailing has been the most active and attractive
sector of the last decade. While the retailing industry itself has been present
throughout the history in our country, it is only the recent past that has witnessed
so much dynamism. Retailing arena today is very different. It’s the latest
bandwagon that has been witnessing hordes of players leaping onto it. While
international retail store chains have caught the fancy of many travelers abroad,
the action was missing from the Sukkur business scene, at least till recently.
The emergence of organized retailing in Sukkur has more to do with the increasing
purchasing power of buyers, specially post liberalization, increase in product
variety, and the increasing economics of scale, with the aid of modern supply and
distribution management solutions.
The current retailing revolution has been provided impetus from multiple sources.
These revolutionaries include many:
Conventional stores upgrading themselves to modern retailing.
Companies in competitive environments entering the market directly to ensure
exclusive visibility for their products.
Professional chain stores coming up to meet the need of the manufacturers who do
not fall into either of the above categories.
Attractiveness, accessibility and affordability seem to be the key offerings of the
retailing chain.
In our presentation, we shall be restricting ourselves to the Organized Retailing
Sector. Organized retailing mainly comprises of Malls, Branded Stores, Specialty
Stores, Departmental Stores, and Discount Stores etc
EVOLUTION:
The world first saw the emergence of retailing in the pre 1850s when the Yankee
Peddlers, Bartering, Trading Posts and General stores were in place. The first
departmental store was established in 1851 by the name of F & R Lazarus Company
in the U.S. Between 1860 and 1910, chain stores and early general stores
dominated the scene. In 1932, the first super market was established in New Jersey
(Big Bear).
In Sukkur the retail market is as old as in the global context. However, the concept
organized retailing is comparatively new. Retailing has been one of the prominent
driving forces in business in Sukkur. Traditionally it has been dominated to a large
extent by the unorganized sector. But the growth of the organized sector has been
steadily increasing especially after liberalization of the Sukkurn economy. The
process started with the establishment of the Shopper’s Stop outlet at Andheri,
Mumbai in 1991.Then, other organized retailing stores like Kids Kemp, Crossroads,
RPG’s Music world, Pyramids etc followed the trend.
CHANGING WAVES
The change that organized retail has brought about is evident from how it has
transformed the neighborhood grocery or ‘kirana’ store. Gone are the dust-coated
shelves and cluttered displays and in place are neat rows of the latest products and
spruced up appearance and attentive staff. Organized retail accounts for merely 2%
of total retail market. The pace of development is, of course, still below the desired
level but the phased growth has been strong enough to ensure that retail does not
go the way some of the other ‘sunrise’ industries did following over-investment.
While big retailers like Shopper’s Stop, Pantaloon, Subhishka, Food World do get
some preferential treatment from large suppliers the relationship between the tow
is tense to say the least. Retailers need to get the customer to spend more at their
outlets before they can turn the tables on manufacturers. With mere 2% share there
is precious little that organized retailing can do to get better terms from
manufacturers. International retailers too have evinced interest in Sukkur’s retail
market.
MORE ARE BETTER OFF
SUKKUR CONSUMER MARKETS
Structure of Sukkur consumer market (2007-2008)
Annual income (Rs) Classification Number of households (in millions)
URBAN RURAL TOTAL
215,0 The rich
Total no. Of households 46.6
MARKET SIZE:
2001-02 2007 CAGR (%)
Large Segments 8,850 23,
Other Segments 6,050 12,
Non-store Retailing 1,100 1,
Total Organized Retail 16,000 37,
3 Large Segments
FOOD
Chain Stores 1,500 6,7
Single Large Stores & others 300 74
CLOTHING
Manufacturing Retailers 1,350 2
Chain Stores 1,450
Single Large Stores & others 2,150 3,
4,950 10
CONSUMER DURABLES
Manufacturer Retailers 650
Chain Stores 450
Single Large Stores 550 1, (Rs Cr)
Source: ORG-Marg, ETIG Estimates.
SWOT Analysis
The Strength-Weakness-Opportunities-Threat analysis of the Retail industry can be
done as follows:
Strengths:
1) Eliminates links in the purchasing chain (direct manufacturer-retailer-customer
chain).
2) Technology driven (hence less error prone)
3) Consultative selling
4) Presence of big industry houses (Tatas, Rahejas etc.) which can absorb loses.
5) Consumer service.
Weaknesses:
1) Lowest per capita space in the world with 2 sq.ft/1000 (congestion)
2) Prices more as compared to specialized shops (in Sukkur).
3) Reluctance of people (Middle and lower class)
4) Non-availability of huge land spaces at prime slots (especially in the metros)
5) High overhead and labor costs.
Opportunities:
1) Lifestyle changes or status consciousness (NRS Survey)
2) Ready availability of real estate in smaller towns.
3) Improved sourcing options.
4) Increasing time pressure for Sukkurn woman..
Threats:
1) Roadside bargains.
2) Other retail outlets (organized and unorganized)
3) Personal and homely attention at smaller Shops
4) Availability of credit at other retail (unorganized) outlets.
5) Competition from unorganized sector.
GROWTH DRIVERS FOR RETAILING SECTOR
Organized retailing is spreading and making its present felt in different parts of the
country. Several growth drivers are responsible for this boom of retail industry.
With the increase in double-income households, working women, there is an
increasing pressure on time with very little time available for leisure. So under these
circumstances people are preferring the convenience of one stop shopping. They
are also seeking speed and efficiency in processing, as a result.
Being more aware, consumers are on the lookout for more information, better
quality, hygiene and as well as increased customer service. These changes in
consumer behavior also augur well for the retail industry.
ADVERTISING & PROMOTIONAL STRATEGIES
Retail, today is a combination of revolution and evolution. The retail industry will
continue to evolve and change. With increasing interest in non-store retailing
(catalogue shopping, online shopping, home delivery), companies will have to
redefine and plan new shopping environments that make shopping experience as
enjoyable as possible. While unique displays add flavor to the store’s interior,
merchandising displays help the customer learn about a product and to promote an
impulse purchase. The present study further confirms that displays play a very
significant role in increasing sales.
MERCHANDISING:
Successful retailers today have found that they can dramatically increase their sales
by merchandising items in a way that creates good impression. The term
merchandising can be defined as “the promotion of a product by developing
strategies for packaging and displaying it”. Effective merchandising can help
generate more customer traffic, amplify repeat business, increase no of customers
who make purchases and increase the size of the purchases that take place- all
leading to increase sales. In-store merchandising is no longer a commodities-driven
method of organizing a product at retail, but rather the last three feet of any
comprehensive and integrated marketing plan. Merchandising plays a crucial role in
leveraging brands, since it talks to the consumer when money, product and
willingness to buy converge at the retail outlet. The KSA consumer outlook study
(2000) in Sukkur established that 75% of consumers look out for attractive display
in a store.
The other important attributes were
Satisfaction with stores
Attributes % Of respondents looking out for this attribute in a retail outlet.
Polite & courteous sales people 86.1
Quality of products 85.9
Non-intrusive sales people 76.2
Value for money 75.1
Attractive displays 75.0
Range of products 65.8
Schemes & promotions 48.8
Exchange/ return policy 44.1
A trial room 32.0
Acceptance of credit cards 25.1
An entertainment center for children 10.0
IMPACT OF RETAIL SECTOR IN SUKKUR:
In Sukkur, the retail sector is the second largest employer after agriculture. The
retail industry in Sukkur is estimated to employ about 10% of the total labor force.
The retail industry in Sukkur is enjoying boom time and job opportunities in retailing
have been increasing. In fact, retailing has emerged as a new stream of
management curriculum, providing new areas of employment. The retailing sector
in Sukkur is highly fragmented and predominantly consists of small independent,
owner-managed shops.
Given the size, and the geographical, cultural and socio-economic diversity of
Sukkur, there is no role model for Sukkur suppliers and retailers to adapt or expand
in the Sukkur context.
Consumer perspective:
Consumer response to supermarkets has been moderate because most do not have
access to transportation to a supermarket and are still in the habit of buying fresh
produce daily from local stores. This is mostly due to the proximity to homes and
personal service of local stores. Self-serve supermarkets are a more recent
phenomenon in Sukkur. These self-service stores stock a wide range of groceries,
snacks, processed foods, confectionery items, and cleaning and personal care
products.
Many shoppers also have the perception that prices are higher at supermarkets
because they are large, brightly lit, and air-conditioned. Higher-income consumers
focus more on convenience and quality.
In urban Sukkur, families are experiencing growth in income and dearth of time.
More and more women are also turning to corporate jobs, which is adding to the
family income but making lifestyles extremely busy. Rising incomes has led to
increasing demand for better quality products while lack of time has led a demand
for convenience and service.
CONCLUSION
The task lying ahead of Sukkur retail is an onerous one. After grappling against the
wild tides of the past decade, a few perseverant players have evolved into mature
players and are confident of the way ahead. Plenty of opportunity exists and the
formidable task is to tap this opportunity, in a unique country like Sukkur.
The huge potential can be tapped if the following three aspects are stressed:
What does it take to make a customer walk into your store and buy products
How many such outlets can we open across the country to achieve national status
and more importantly economies of scale.
Results
References
