Retail Management

S. No 2
 Retail Management
Decision Process

• 1 Understanding Retail Environment

• A. Macro Environment
• i. Socio Env.-Society, Culture
• ii. Economic-GDP, Inflation, Interest Rates, Per Capita Incomes
• iii. Legal Env. Suppliers, Compttrs, Consumers, Employees, Govt. laws
• iv. Political Env. Ideologies, Policies –location, merchandise, optns
• v. Tech Env. Shopping experience, operations, customer research
 Retail Management
Decision Process
• 1 Understanding Retail Environment
• B. Micro Environment
• i. Competititors-Barriers to Entry, Quantum of Competition & Intensity of Comptn,
SWOT analysis
• ii. Suppliers-Bargaining power of Vendors
• iii. Financers-Terms, Interest Rates
• iv. Customers-TG, STP, CRM
• v. Work Force-Available, Training & Skill Set.
•
 Retail Management
Decision Process
• 2. Developing the Retail Strategy.
• 1. Identification of Target Market

• 2. Nature of Merchandise & Services to be offered

• 3. Developing Competitive Advantage-Operations & Positioning

 Retail Management
Decision Process
• 3.Implementing the Retail Strategy:
• i. Merchandise Mix & Qty. Planning & Monitoring
• ii. Location
• iii. Store Layout & Design
• iv. Advertising-Positioning & Promotion
• v. Customer Service
• vi Price-Mark ups & Value for Money.
 Contemporary Factors Impacting
Retail Management
• 1. Computerisation-AI

• 2. Communication-Personalisation, Visual,Verbal, Multi Cultural

• 3. Fashion-Trends and Fads.

• 4. Consumerism-Heightened Expectations
 Indian Retail
Facts
Largest Industry sector. 10 % of GDP, 8% of employment
Immense Transformation-Structure, size, practices
Organised & Unorganised-Traditional. 10-12% to 88-90%
Rate of Growth of Online Retail is higher than Modern Retail
World’s Fastest Growing Retail Destination
 Indian Retail
• Facts
• Growth Expectations: CAGR 10 % from $641 billion in 2016 to $ 1.6
trillion in 2026.Overall Retail 12 %-Traditional !0%,Modern
20%,Online26%
• India B2B expected to reach $700 billion
• Luxury Market High Growth
• High Growth Rates in Tier 2 & 3 Cities
Indian Retail
Evolution of Retail
 Indian Retail
1. High Growth-Due to Significant increase in GDP, Marginal Increase in
PCY, Increased propensity to spend and consume
2. Increase in Overall Retail, Higher Levels of Increase in Modern Retail,
Highest Increase in e Commerce though total share of above two in total
retail low.
3. Usage of Technology and Factoring in of Consumer Expectations.
4. Rise in Intensity of Competition
 Indian Retail-Emerging Trends
• 1. Global Retailers enter Indian Market-Tommy, H&M, M&S,
Hamleys, Metro, Carrefour, Walmart, Apple, Nike etc., Huge potential in
Indian mkt
• 2. Large Indian Corporates diversify in Retail-Reliance, Tata, Aditya
Birla, Bharati,Adani, M&M
• 3. Growth of Online Retail-in sync with Global trends & Gen Zee.
Penetration in Tier 3 cities & Hinterland
• 4. Omni Channel Retail-presence across more than 1 channel.
 Indian Retail-Emerging Trends
• 5. Increase in Young Working Population: DINK-Double Income No Kids-Nuclear
Families-Apparels, Appliances, Electronics, Personal Care, Homes, Travel & Leisure.
• 6. Adoption of Modern Retail Practices: Merchandising, Store Ops, Supply Chain,
Store Design-Layout, Trial, Instant Returns & Product Demos
• 7 . Large Format Retailing: Departmental Stores & Experience Shopping
• 8. Integrated Distribution Systems: Retial Distribution Centres. Backward
• Integration
• 9. Growth of Private Labels-Retailer Brands
 Importance of Indian Retail
Economic Significance
• 1. Source of Employment: 17% of employment
• Urban Employment-Front End & Back End
• Rural Employment-Contract Farming-latest tchnqs
• 2. Opportunities for Entrepreneurship: Modern & Supply Chain
• 3. Infrastructure Development: Real Estate, Buildings, Transport, Banking &
Credit
• 4. Taxes: Accounts & Accountability for Transactions. Payment of Taxes-Local
• National-Reduction in Parallel Economy.
 Challenges to Indian Retail
• 1. Poor Infrastructure: Lack of Cold Chain for food sector. Poor Road Links.
Lack of Suitable Real Estate.

• 2. Absence of Skilled Manpower: Education, Attitude, Skills

• 3. Price Sensitivity of Indian Consumer: Low Customer Loyalty

• 4. Bargaining Power of Suppliers: Few Quality Suppliers-Oligopolistic

 Challenges to Indian Retail
• 5. Bargaining Power of Consumers: Intense Competition & Heightened
Customer Expectations
• 6. Data Availability & Reliability: Lack of Insights about Consumers,
Retail Sales, Databases constrain Retail operations
• 7. Opaque Real Estate Laws & Practices:
• 8. High Shrinkage Rates: Pilferage both Consumers & Employees
 Indian Retail
Drivers for Retail Change in India.

• 1. Customer is the Key Change Agent. The King

• 2. Re Evaluating the Marketing Plan. Mass to Customised Advtsng-
Branding-Strong PR
• 3. Advanced Education & Retail Skill Training
• 4. Strong Visual Recognition
• 5. Manpower Issues-People of Services-Qty and Qlty
 Indian Retail
Drivers for Retail Change in India.

• 6. Strategic planning
• 7. Changing Income Profiles-Double Incomes-Expanding Middle Class
• 8. Diffusion between Rural & Urban India
• 9. Changes in Consumption Patterns-Health, Working Women, DIY
• 10. Availability of Credit
• 11. Improved Logistics & Better Infrastucture
 Strategic Retail Planning Process
• 1. Defining Business Philosophy, Mission & Corporate Objectives
• 2. Situation Analysis
• Internal Analysis-Finance, Merchandising-Procurement, Marketing,
• Managerial Capabilities, Store
Management,Operations
• External Analysis-Legal Retail Env, Tech Env, Political Env, Eco Env
&
• Socio Cultural Env
 Strategic Retail Planning Process
• 3. Identification & Evaluation of Strategic Oppors
• Strategies for Growth