An analysis of Big Bazaar on the basis of location and layout.

-A Retail Management assignment

Submitted By: Apoorv Verma

19020841171
Q. Identify and analyse retail format and store layout of the retail brand.

Ans. Big bazaar is one of the most well known names in India when it comes to retail. Its retail
format is that of a chain department store. This is because it is a chain of large stores selling
different types of products under different departments but within a single building. Each store
has separate handling for its accounting, management, and location.
Also since Big Bazaar is owned and managed centrally, earlier by the parent company Future
Group and recently acquired by Reliance Retail, it is a chain department store.

Layout refers to the interior setup and how products are allocated in an actual physical space
within the store. It is imperative for the retailers to understand the importance this has on the
purchase experience and hence on the actual purchase behaviour of the customer.

Big
Bazaar outlets always look very crowded. This is not by accident but instead a deliberate strategy
of theirs. In India, especially in Big Bazaar's targeted market, neat and clean aisles wouldn't do
the trick! There has to be what is called the ‘button and brush effect’, and an ‘organized chaos’.
As Indians, we are culturally attuned to bumping into others, gossiping, chatting away etc while
shopping.
Big Bazaar layout has long rows of parallel fixtures instead of aisles. Also created are mini-
bazaars; a cluster of items in different sections selling various categories.I
This layout allows to have more customers in the store, easy merchandise setting, easy co-
existence of workers and customers.
At the same time it also ensures that the people keep moving. Crowded spaces discourage
loitering and hence there is a constant flow of people staying in the store only if they intend to
purchase.

Q. What are the factors to be considered before selecting a store location and why?

Ans. The choice of location for Big Bazaar will have a major impact on how it performs, how its
layout should be designed etc. A proper devision making regarfing location is imperative ad it
may decide success or failure of the store in question. Some of the things Big Bazaar should
definitely ask are:
• What is the target audience?
Without a doubt this is of utmost importance in location selection decisions.
• What are the specifications of the building?
Does the selected locality have enough space? Would a multi story building be needed or a wide
spread single story building can do the job?
• What are the product offerings that we are going to provide?
It helps in deciding the location and type of assortment that facility would have.

In addition to these basic questions, there are a few other factors too that should be considered:

Type of Goods

As the products range varies from low priced convenience goods to higher priced goods and
speciality goods like Furniture, Electronics, Upscale clothing’s etc; Big Bazaar needs to provide
its customers with a feeling of one stop solution ie a complete shopping experience of different
products and variable prices. To facilitate this, Big Bazaar are generally located in a Shopping
Mall

Population and Your Customer

The choice of area’s/cities where to locate Big Bazaar is determined by the area’s population,
income and age. The location demographics are arranged from the chamber of commerce or the
Census Bureau. Big Bazaar is targeting Tier I and Tier II cities as of now.

Accessibility:
It aims to avoid a low of crowd or traffic to one place. Hence Big Bazaar needs to be found
where there are numerous customers however just if that customer meets the meaning of their
objective market. The other significant standards are:

• what number of individuals walk or drive past the area.

The atmosphere shopping center is a serious popular objective for shopping in close by zones

• Is the territory served by open transportation?

It is very much associated with the remainder of the city

• Can clients and conveyance trucks effectively get in and out of the parking garage?

It's a moderately less thick region as far as populace and transportation is simpler

• Is there satisfactory stopping?

As it's a major shopping center, there is staggered underground stopping for the clients.

Signage, Zoning, and Planning

The initial phase in this is to contact the neighborhood city lobby and drafting the commission
for data on guidelines concerning signage. What's more, to enquire about any limitations that
may influence the retail activity and any future arranging that could change traffic, for example,
roadway development, and so forth Huge Bazaar needs to deal with government rules and
guidelines concerning the signage and other promotion strategies.

Rivalry and Neighbors

Other territory organizations in the imminent area can really help or hurt the business.
Subsequently, they decide whether the kinds of organizations close by are viable or not.

Area Costs

Other than the base lease, a wide range of expenses are considered before picking the area:

• Who pays for building upkeep, utilities, and security?

• Who pays for the upkeep and fix of the warming/air units?
• If the area is distant, what amount of extra promotion will it take for clients to discover you?

• How much is the normal service bill?

• Will you have to make any fixes, do any artistic creation, or re-displaying to have the area met
your requirements?

• The material property charges

Q. What are the pros and cons of the site locations?

Ans.
Pros:

● Easier access: Most of the store locations across India are near heavy residential areas or
commercial areas. As a result, the stores were established in places where they could be
near to the customer and provide great advantage of easy accessibility.
● Higher visibility: Big Bazaar targets mostly affluent and upper middle class demography.
Their locations make sure that these target groups definitely see the store frequently. Eg:
The Ambience Mall is chosen for the location because it has high visibility and it is a
famous destination for shopping in the city.
● Ease of shopping experience: Seemingly unrelated features often have an impact on
consumer’s feelings towards a retail store. Even something as small as ease of parking
can turn a consumer away. These issues are not faced by Big Bazaar because they are
usually situated in huge commercial areas like malls etc who have their own multilevel
parkings. Eg: Sector 18 in Noida is a very congested area and parking is a huge issue
there. However, since Big Bazaar is situated inside both DLF Mall of India and The
Great Indian Palace mall, both with their own MLP, Big Bazaar doesn’t have to bother
with providing its customers with a separate parking facility.

Cons:

● Location cost saving strategy is an investment risk: The reason why Big Bazaar has
chosen to provide cheap price to its customers in order to keep the price competitive and
as low as possible. Moreover, it needs to manage its cost if the location is expensive and
that will be difficult with lower margins on the products. So, Big Bazar has to plan well
in advance before opting for a location in order to maintain competitive price. It is a huge
risk for the store because if the neighboring property of the store does not develop
enough the store will fail.
 ● Unorganised sector as a huge competitor: Though in Tier I cities, opening a stand alone
Big Bazaar might be possible, in Tier II cities, which are actually targeted by Big Bazaar,
independent stores might fail to attract customers. This is because in Tier II cities, the
mall shopping is seen as an extravagant “Break from the routine”. There, the consumers
still prefer the unorganised sector. Eg: In Saharaganj mall, Lucknow; shopping for
groceries from Big Bazaar was considered as a splurging occasion, owing to its location
in Hazratganj, a posh area.
● Issues in procurement: A lot of Tier II cities still follow the convoy rules for trucks
entering the city. This means that The trucks can only enter the city at night. This means
there needs to be extra focus on inventory management systems and an increase in the
buffer stock.

Q. How the location or the format helped to create a competitive

advantage? What is the scope to change?

Ans. There are quite a few factors that have helped Big Bazaar gain a competitive
advantage over their rivals:

 The area of the store is huge, typically in thousands of square feet. Due to this
they can display a wide category and assortments of products.
 They have a pan India presence, in Tier 1,2 and 3 cities in various locations.
They have a network of 250+ stores across the country, hence are able to cater
to almost all of its target customers.
 Their location strategy is unique, as they choose to open stores in both upscale
malls and posh neighborhoods, as well as a typical residential/commercial area.
This positions themselves as being a brand that caters to both upper-middle and
middle class demography In all the cities.
 Since they have such a large number of stores that stock a wide variety of
products at huge volumes, they have a huge bargaining power over their
suppliers. This allows them to buy in bulk and pass on the reduced costs to their
customers. It’s a win-win situation for all the parties.

Some factors that could help Big Bazaar gain a better competitive advantage are:
  They could also target rich and upper-middle class demography, since they are
ready to spend lavishly on the products they want. Exclusive store-in-store
concept could be introduced by them.
 They could also foray into offering private labels. They could be another potential
source of income. It’d help if the labels are cheap, since they would further
consolidate the position of Big Bazaar as a chain that offers low priced goods at
top notch quality.
 They should also seek developing their online presence. Online retail is taking off
in India and could give a big boost to its sales.

Big Bazaar store locations across Asia

Q. Innovative practices used by Big Bazaar to improve the competitive advantage?

Ans. Big Bazaar has been successful in creating a competitive advantage for itself by cautiously
mapping their target demography with its store location. Following are some of their core
competencies:
● The products range i.e more than 20,000 products approximately
● They deliver in a huge number of cities and towns around 1500 in India spanning across
geographies covering approximately 16000 pincodes.
● Their delivery is fast as they have tie ups with the top logistics and transportation service
providers in the world.
● They have a well-focused and customer service oriented helpline for queries
● They offer manufacturer’s guarantee in contrast to the Seller’s guarantee
which is offered by most of the other online shopping platforms
● Promoting affordability of their products along with quality
● Main focus is given to clothing category and lifestyle products
● Provision of great rebate prices

It is evident that Big Bazaar has adopted a number of innovative practices in not just location
strategies, but clubbed them up with promotion, pricing, product and physical evidence strategies
as well.
Taking a look at each element of the marketing mix, following are the innovative practices Big
Bazaar has been using:

Marketing Mix of Big Bazaar

Product: Big Bazaar has a plethora of product range which it offers to its customers. In different
stores that are present in different areas the product offered is mostly the same but the brand
choices given to the customers is great vouching good quality. The quantity is not restricted to
large packs as it provides a great range of pack sizes for varied products. The goods offered in
the supermarket chain have its own products that have a wide channel of distribution network
ready for delivery. Big Bazaar's own items include the fashion magazine My Country, which is
not available anywhere else. Therefore, prices for such goods are very low.
.
Price: The key focus in an industry that provides competitive products is the price. In a model
that provides low cost benefits, Big Bazaar works. The discounted price is taken as the unique
selling proposition for these stores. With respect to their MRP, there is an average discount of 6-
8 percent on all products. Product prices are low since they are able to secure stock directly from
the supplier. In the context of buying in huge quantities, the system which regulated mode of
transportation and looking after the main warehouse or stock house there are tremendous
synergies. Both of these variables are very beneficial for distributors to hold low price.
Place: Place signifies the location for a business and Big Bazaar strategy is focused on locating
their stores in cheap locations. The store targets the semi-urban population of the city by being
available in locations which are less costly. It never goes for locations which are high in cost. As
it is focused on low cost locations so the store attracts customers by running promotional
activities. Moreover, it takes the advantage of the internet to overcome the unattractiveness of the
location. Big Bazaar has its retailing website named www.futurebazaar.com that targets high
end customers. The website promotion is done through Google ads and are placed as sponsored
link.
Promotion in the Marketing Mix of Big Bazaar: The promotion budget kept by big Bazar is
huge. Their idea behind their all advertisements is making consumers buy in bulk. They focus on
2 types of promotion budgets. One is focused on promoting the brand, the image of big bazaar.