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A STUDY

ON
Organized and Unorganized Retail market-
BY
N.AMIT
(Reg. No - !"#$
O%
&IS'(A &IS'(ANI INSTITUT) O* SYST)MS AND MANA+)M)NT
Under t,e +-idan.e o%
/ro%. Anand
A00o.iate /ro%e00or
A PROJECT REPORT
Submitted to the
*A1U2TY O* BUSIN)SS MANA+)M)NT
In partial fulfillment of the requirements for the award of the
/OST +RADUAT) DI/2OMA IN MANA+)M)NT
1)RTI*I1ATION *ROM INT)RNA2 +UID)
This is to Certify that the dissertation titled A ST!" O# OR$A#I%E! A#!
#OR$A#I%E! RETAI& 'AR(ET )y 'r * #+Amit, Re- #o * ./01 Is a re2ord of
resear2h wor3 done durin- the year 04/45//, under my dire2tions and that the dissertation
has not pre6iously formed the basis for the award of any de-ree or !iploma or Asso2iate
ship , with the similar title, by any other uni6ersity7Institute+
8yderabad Si-nature of Internal $uide
!ate * 9#ame of the internal $uide:
2
D)12ARATION
I hereby de2lare that the dissertation on A ST!" O# OR$A#I%E! A#!
#OR$A#I%E! RETAI& 'AR(ET has been written by me durin- the year 04/45//,
under the -uidan2e of Prof+Anand of ;ishwa ;ishwani Institute of Systems <
'ana-ement, 8yderabad, in partial fulfillment of the requirement of the award of Post
$raduate !iploma in 'ana-ement+
I also de2lare that this dissertation is the result of my own efforts and has not been
2opied from any other sour2e or submitted to any other uni6ersity7Institute, before+
8yderabad Si-nature
!ate* 9#ame of the student:
3
3 1)RTI*I1ATION
This is to 2ertify that 'r+#+Amit, Re- #o * ./01 of P$!' I; Semester at ;ishwa
;ishwani Institute of Systems < 'ana-ement, 8yderabad, has prepared the
dissertation titled A ST!" O# OR$A#I%E! A#! #OR$A#I%E! RETAI&
'AR(ET durin- the year 04/45// under the -uidan2e of Prof+ Anand as a partial
fulfillment , for the award of Post $raduate !iploma in 'ana-ement, by our Institute+
8yderabad 9Si-nature:
!ate* !ire2tor, A2ademi2s
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)4e.-ti5e S-mmar6
The real $!P is e=pe2ted to -row at >5/4 per 2ent per annum in the ne=t fi6e years+ As a result,
the 2onsumin- 2lass with annual household in2omes abo6e Rs+ ?4,444 is e=pe2ted to rise from
about 1@4 million in 044A54@ to A04 million in 04//5/0+ Consequently, the retail business in
India is estimated to -row at /1 per 2ent annually from SB 100 billion in 044A54@ to SB .?4
billion in 04//5/0+ The study shows*
C The unor-aniDed retail se2tor is e=pe2ted to -row at about /4 per 2ent per annum with sales
risin- from SB 14? billion in 044A54@ to SB E?A billion in 04//5/0+
C $i6en the relati6ely wea3 finan2ial state of unor-aniDed retailers, and the physi2al spa2e
2onstraints on their e=pansion prospe2ts, this se2tor alone will not be able to meet the -rowin-
demand for retail+
C 8en2e, or-aniDed retail whi2h now 2onstitutes a small four per 2ent of total retail se2tor is
li3ely to -row at a mu2h faster pa2e of E.5.4 per 2ent per annum and quadruple its share in total
retail trade to /A per 2ent by 04//5/0+
C This represents a positi6e sum -ame in whi2h both unor-aniDed and or-aniDed retail not only
2oe=ist but also -row substantially in siDe+
C The maFority of unor-aniDed retailers sur6eyed in this study, indi2ated their preferen2e to
2ontinue in the business and 2ompete rather than e=it+
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1'A/T)R 7 !
Introd-.tion to Indian retail ind-0tr6
6
Introd-.tion to Indian retail ind-0tr68
The sea of 2han-e 2an pull 2ustomers in many dire2tions+ It is our responsibility to li-ht the way
and ta3e 2are of themG before the 2ompetition does+
R)TAI2IN+ 'eans Re5tailin-H to the 2ustomers so that they 2omeba23+
Retailin- 2onsists of all a2ti6ities in6ol6ed in sellin- -oods and ser6i2es to 2onsumers for their
personal, family, or household use+ It 2o6ers sales of -oods ran-in- from automobiles to apparel
and food produ2ts, and ser6i2es ran-in- from hair 2uttin- to air tra6el and 2omputer edu2ation+
Sales of -oods to intermediaries who resell to retailers or sales to manufa2turers are not
2onsidered a retail a2ti6ity+
The Indian retail story 2ouldnIt ha6e been more different+ India has appro= /0 million retail
stores, more than rest of the world put to-ether+ )ut the per 2apita square feet area under retail is
Fust 0 sq+ft or 4+0 sq+ meters with fra-mented 3irana stores bein- the predominant players+
Retailin- in India has remained in the unor-aniDed se2tor and lar-ely untou2hed by 2orporate+
The first de2ade of modern retail in India has been 2hara2teriDed by a shift from traditional
2hannels to new formats in2ludin- department stores, hypermar3ets, supermar3ets and spe2ialty
stores a2ross a ran-e of 2ate-ories+
'odern retail formats ha6e mushroomed in metros and mini5metros, in the last few years
modern retail has also established its presen2e in the se2ond run- 2ities+ Thus, e=posin- the
residents of these 2ities to shoppin- options, they ha6e ne6er e=perien2ed before+ It has been
fore2asted that the share of modern retail will in2rease from 0 per 2ent 2urrently, to about /.504
per 2ent o6er the ne=t de2ade+ To be-in with, retailers today will ha6e to support the lar-e retail
infrastru2ture in terms of 'alls and Superstores that are bein- 2reated+ The 2hallen-e for leadin-
retailers shall therefore shift from di6ertin- demand to 2reatin- demand+
Jith all the modern stores offerin- 2on6enien2e in terms of an assortment of produ2ts,
ambien2e, ser6i2e and inno6ati6e produ2ts, the paradi-m shall shift from 2ompetin- with the
3irana stores to an in5house demand 2reation+ Rele6ant e=perien2es from 2onsumer -oods
2ompanies, whi2h ha6e su22essfully 2rafted an e=plosion in demand in their se2tors, throu-h
inno6ation, 2onsumer dri6en strate-ies, will be head runner+ Times are 2han-in-+ Jith the $!P
at an all time hi-h and in2ome le6els shootin- throu-h the roof, the a6era-e Indian 2onsumer has
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ne6er had it so -ood+ The propensity to 2onsume has rea2hed pea3s that had ne6er been s2aled
before+ Credit 2ards are flashed with disdain and shoppin- bas3ets are -ettin- bi--er all the time+
8ere are some fa2tors that indi2ate the potential of retail in India*
At 0@/ million, one of the lar-est 2onsumin- base in the world, formin- 0@K of the total
population+
A hi-h spendin- 2ommunity below E. years 2omprises >/ per2ent of the population+
A youn- population with .EK population below 0. years
In2reased litera2y from EEK in /?A. to @4K in 0441
In2rease in wor3in- women from /+1 million in /?A/ to E+> million in /??>+
The first de2ade of modern retail in India has been 2hara2teriDed by a shift from traditional
3irana shops to new formats in2ludin- department stores, hypermar3ets, supermar3ets and
spe2ialty stores a2ross a ran-e of 2ate-ories+ 'odern retail formats ha6e mushroomed in metros
and mini5metros+
In the last few years, modern retail has also established its presen2e in the se2ond5run- 2ities,
e=posin- residents to shoppin- options li3e ne6er before+ 8owe6er, e6en as modern retailers
-arner share from traditional 2hannels, there is a lar-er role they would be required to play in
boostin- 2onsumption le6els+ Li-ures su--est that the total turno6er of the se2tor is around Rs /4
la3h 2rores, of whi2h E per2ent is 2ontributed by the or-anised se2tor+
The retail se2tor in India is hi-hly fra-mented with or-aniDed retail 2ontributin- to only 0K of
total retail sales+ The retail se2tor in de6eloped 2ountries was also hi-hly fra-mented at the
be-innin- of the last 2entury but emer-en2e of lar-e 2hains li3e Jall 'art, Sears, and
'2!onaldMs led to rapid -rowth of or-aniDed retail and -rowin- 2onsolidation of the retail
industry in the de6eloped 2ountries+
Or-aniDed retail is -rowin- rapidly and we see the emer-en2e of lar-e or-aniDed retail 2hains
li3e ShopperMs Stop, &ifestyle, and Jestside+ Je also find retail malls mushroomin- all o6er the
2ountry+ The opportunities in retail industry in India will in2rease sin2e Indian retailin- is on the
threshold of a maFor 2han-e+
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India retail industry is the lar-est industry in India, with an employment of around >K and
2ontributin- to o6er /4K of the 2ountryIs $!P+ Retail industry in India is e=pe2ted to rise 0.K
yearly bein- dri6en by stron- in2ome -rowth, 2han-in- lifestyles, and fa6orable demo-raphi2
patterns+ It is e=pe2ted that by 04/A modern retail industry in India will be worth SB /@.5 044
billion+ India retail industry is one of the fastest -rowin- industries with re6enue e=pe2ted in
044@ to amount SB 104 billion and is in2reasin- at a rate of .K yearly+ A further in2rease of @5
>K is e=pe2ted in the industry of retail in India by -rowth in 2onsumerism in urban areas, risin-
in2omes, and a steep rise in rural 2onsumption+ It has further been predi2ted that the retailin-
industry in India will amount to SB 0/+. billion by 04/4 from the 2urrent siDe of SB @+.
billion+
Shoppin- in India ha6e witnessed a re6olution with the 2han-e in the 2onsumer buyin- beha6ior
and the whole format of shoppin- also alterin-+ Industry of retail in India whi2h ha6e be2ome
modern 2an be seen from the fa2t that there are multi5 stored malls, hu-e shoppin- 2enters, and
sprawlin- 2omple=es whi2h offer food, shoppin-, and entertainment all under the same roof+
India retail industry is e=pandin- itself most a--ressi6ely, as a result a -reat demand for real
estate is bein- 2reated+
!.! Traditional 1on5enien.e Store08
Traditional 2on6enien2e stores are too well established in India than to be wiped out and besides
there is uniqueness in the traditional items that represent the sub52ontinent+ The retail stores in
India are essentially dominated by the unor-aniDed se2tor or traditional stores+ Infa2t the
traditional stores ha6e ta3en up ?> per2ent of the Indian retail mar3et+ #ow stores run by families
are primarily food based and the set up is as (irana or the I2orner -ro2erI stores+ )asi2ally they
pro6ide hi-h ser6i2e with low pri2es+ If the stores are not food based then the type of retail items
a6ailable are lo2al in nature+
The traditional family run 2on6enien2e stores 2an ta3e pride in the fa2t that the (irana is the
most 2ommon outlet forms for the 2onsumers+ The tou-h 2ompetition for 2on6enien2e stores are
2omin- from or-aniDed retail stores dealin- in food items, li3e*
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Apna )aDaar
Canteen stores
Lood Jorld
Subhi3sha
Lood )aDaar
1on5enien.e Store0 are open for lon- hours and is one of the formats of the Indian retail stores
that 2ater to basi2 needs of the 2onsumer+ A -ood e=ample of su2h would be Con6enio+ These
stores are found in both residential as well as 2ommer2ial mar3ets+ The food produ2ts of
traditional family run 2on6enien2e stores are 2omprised of branded as well as non5branded items+
The benefit of family5run 2on6enien2e stores is that they -i6e importan2e to*
Personal tou2h
La2ilities of 2redit
Nui23 home deli6ery
#on5food based sto23 2omprises of multiple and 6arieties of lo2al brands+
The future of su2h stores as they fa2e 2ompetition from or-aniDed se2tor, would depend on the
followin- parti2ulars*
Pla2e and 2apa2ity
!ili-ent area 2o6era-e
!is2iplined wor3 s2hedule
'ana-in- turno6er
Re6enue from assets
Customer ser6i2e and satisfa2tion
The traditional family run 2on6enien2e stores ser6es the purpose of the housewi6es who
definitely wants to a6oid tra6elin- lon- distan2es to pur2hase daily needs+ The 2on6enien2e
fa2tor in terms of items, amon- people in -eneral 2an be hi-hli-hted as below*
$ro2eries
Lruits
10
!ru- Store
#e2essary stationery
As su2h traditional family run 2on6enien2e stores are here to stay and 2annot be o6ersiDed by the
or-aniDed retail se2tor besides, it represents the 6ariety of India+
!." Indian organized retail market8
Indian or-aniDed retail mar3et is -rowin- at a fast pa2e due to the boom in the India retail
industry+ In 044., the retail industry in India amounted to Rs /4,444 billion a22ountin- for about
/4K to the 2ountryIs $!P+ The or-aniDed retail mar3et in India out of this total mar3et
a22ounted for Rs 1.4 billion whi2h is about 1+.K of the total re6enues+
Retail mar3et in the Indian or-aniDed se2tor is e=pe2ted to 2ross Rs /444 billion by 04/4+
Traditionally the retail industry in India was lar-ely unor-aniDed, 2omprisin- of dru- stores,
medium, and small -ro2ery stores+ 'ost of the or-aniDed retailin- in India ha6e started re2ently
and is 2on2entratin- mainly in metropolitan 2ities+ The -rowth in the Indian or-aniDed retail
mar3et is mainly due to the 2han-e in the 2onsumersM beha6ior+ This 2han-e has 2ome in the
2onsumer due to in2reased in2ome, 2han-in- lifestyles, and patterns of demo-raphy whi2h are
fa6orable+ #ow the 2onsumer wants to shop at a pla2e where he 2an -et food, entertainment, and
shoppin- all under one roof+ This has -i6en Indian or-aniDed retail mar3et a maFor boost+
Retail mar3et in the or-aniDed se2tor in India is -rowin- 2an be seen from the fa2t that /.44
supermar3ets, 10. departmental stores, and 144 new malls are bein- built+ 'any Indian
2ompanies are enterin- the Indian retail mar3et whi2h is -i6in- Indian or-aniDed retail mar3et a
boost+ One su2h 2ompany is the Relian2e Industries &imited+ It plans to in6est SB A billion in
the Indian retail mar3et by openin- /444 hypermar3ets and /.44 supermar3ets+ Pantaloons is
another Indian 2ompany whi2h plans to in2rease its retail spa2e to 14 million square feet with an
in6estment of SB / billion+ )harti Tele2oms an Indian 2ompany is in tal3s with Tes2o a -lobal
-iant for a O @.4 million Foint 6enture+ A number of -lobal retail -iants su2h as Jalmart,
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Carrefour, and 'etro A$ are also plannin- to set up shop in India+ Indian or-aniDed retail mar3et
will definitely -row as a result of all this in6estments
1la00i%6ing Indian retail8
9A:'odern Lormat retailers
/: Supermar3ets 9Loodworld:
0: 8ypermar3ets 9)i- )aDaar:
1: !epartment Stores 9Shoppers Stop:
E: Spe2ialty Chains 9I3ea:
.: Company Owned Company Operated 9)P:
(B$Traditional *ormat Retailer08
/: (iranas* Traditional 'om and Pop Stores
0: (ios3s
1: Street 'ar3ets
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E: E=2lusi6e 7'ultiple )rand Outlets
(1$2arge Indian retailer0
/+ 8ypermar3et
/: )i- )aDaar
0: $iants
E: Star
II !epartment store
/: &ifestyle
0: Pantaloons
1: Piramyds
III Entertainment
/: Lame Adlabs
0: Lun Republi2
E: P;R
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1la00i%i.ation o% Indian retail 0e.tor
". 1la00i%i.ation o% Indian retail 0e.tor8
a: LOO! RETAI&ERS
There are lar-e number and 6ariety of retailers in the food5retailin- se2tor Traditional types of
retailers, who operate small sin-le5outlet businesses mainly usin- family labour, dominate this
se2tor In 2omparison, super mar3ets a22ount for a small proportion of food sales in India,
8owe6er the -rowth rate of super mar3et sales has bein- si-nifi2ant in re2ent years be2ause
-reater numbers of hi-her in2ome Indians prefer to shop at super mar3ets due to hi-her standards
of hy-iene and attra2ti6e ambien2e+
b: 8EA&T8 < )EAT" PRO!CTS
Jith -rowth in in2ome le6els, Indians ha6e started spendin- more on health and beauty produ2ts
+8ere also small, sin-le5outlet retailers dominate the mar3et +8owe6er in re2ent years, a few
retail 2hains spe2ialiDin- in these produ2ts ha6e 2ome into the mar3et+ Althou-h these retail
2hains a22ount for only a small share of the total mar3et their business is e=pe2ted to -row
si-nifi2antly in the future due to the -rowin- quality 2ons2iousness of buyers for these produ2ts+
C: C&OT8I#$ < LOOTJEAR
#umerous 2lothin- and footwear shops in shoppin- 2enters and mar3ets operate all o6er India+
Traditional outlets sto23 a limited ran-e of 2heap and popular itemsP in 2ontrast, modern 2lothin-
and footwear stores ha6e modern produ2ts and attra2ti6e displays to lure 2ustomers+ 8owe6er,
with rapid urbaniDation, and 2han-in- patterns of 2onsumer tastes and preferen2es, it is unli3ely
that the traditional outlets will sur6i6e the test of time+
!: 8O'E LR#ITRE < 8OSE8O&! $OO!S
Small retailers a-ain dominate this se2tor+ !espite the lar-e siDe of this mar3et, 6ery few lar-e
and modern retailers ha6e established spe2ialiDed stores for these produ2ts+ 8owe6er there is
2onsiderable potential for the entry or e=pansion of spe2ialiDed retail 2hains in the 2ountry+
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E: !RA)&E $OO!S
The Indian durable -oods se2tor has seen the entry of a lar-e number of forei-n 2ompanies
durin- the post liberaliDation period+ A -reater 6ariety of 2onsumer ele2troni2 items and
household applian2es be2ame a6ailable to the Indian 2ustomer+ Intense 2ompetition amon-
2ompanies to sell their brands pro6ided a stron- impetus to the -rowth for retailers doin-
business in this se2tor+
L: &EISRE < PERSO#A& $OO!S
In2reasin- household in2omes due to better e2onomi2 opportunities ha6e en2oura-ed 2onsumer
e=penditure on leisure and personal -oods in the 2ountry+ There are spe2ialiDed retailers for ea2h
2ate-ory of produ2ts 9boo3s, musi2 produ2ts, et2+: in this se2tor+ Another prominent feature of
this se2tor is popularity of fran2hisin- a-reements between established manufa2turers and
retailers+
TodayMs trend is the de6elopment of inte-rated retail 2um Entertainment 2enters or shoppin-
malls+ An in2reasin- number of retailers are fo2usin- on malls now as opposed to stand5alone
de6elopments+ Jhile the number of shoppin- malls has seen a massi6e sur-e in the re2ent past in
the metros and their suburbs, the latest trend in this se2tor is the in2reasin- fo2us on pro6idin-
leisure a2ti6ities su2h as multiple=es, fa2ilities for 3idsI entertainment, eateries et2+ within the
mall premises+ Customer less the time 2onsumes and more entertainment with his family in malls
be2ause they within shoppin- mall number of retail shop and 6ariety of produ2ts and sele2ted the
produ2t they want+ $ood en6ironment in mall+ &ess 2rowed and These are en2losed, air5
2onditioned, multi5le6el malls of at least /44,44 sq ft+ Criti2al to these malls is the 2on2ept of the
an2hor, the 3ey outlet or store around whi2h other outlets 2luster+ The most popular Indian
an2hors in2lude ShoppersI Stop, $lobus, Pantaloon, &ifestyle and hypermar3ets li3e )i- )aDaar
and $iant+ Cinemas also often an2hor malls+ !ri6en by the lu2rati6e ta= brea3s, the old sin-le
s2reen theatres are bein- di6ided into three5fi6e smaller s2reens, as was done in the S, years
a-o, for e=ample Ja6e and P;R+
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1on0-mer 9e,a5ior and retailing de.i0ion0
#. 1on0-mer 9e,a5ior and retailing de.i0ion08
Consumer beha6ior refers to the mental and emotional pro2ess and the obser6able beha6ior of
2onsumers durin- sear2hin-, pur2hasin- and post 2onsumption of a produ2t or ser6i2e+ Consumer
beha6ior in6ol6es study of how people buy, what they buy, when they buy and why they buy+ It
blends the elements from psy2holo-y, so2iolo-y, so2iopsy2holo-y, anthropolo-y and e2onomi2s+
It also tries to assess the influen2e on the 2onsumer from -roups su2h as family, friends,
referen2e -roups and so2iety in -eneral+ )uyer beha6ior has two aspe2ts* the final pur2hase
a2ti6ity 6isible to any obser6er and the detailed or short de2ision pro2ess that may in6ol6e the
interplay of a number of 2omple= 6ariables not 6isible to anyone+
Factors Affecting Consumer Buying Behavior
Consumer buyin- beha6ior is influen2ed by the maFor three fa2tors*
So2ial La2tors
Psy2holo-i2al La2tors
Personal La2tors+
A. So2ial La2tors
So2ial fa2tors refer to for2es that other people e=ert and whi2h affe2t 2onsumersM pur2hase
beha6ior+ These so2ial fa2tors 2an in2lude 2ulture and sub2ulture, roles and family, so2ial 2lass
and referen2e -roups+
B. Psy2holo-i2al La2tors
These are internal to an indi6idual and -enerate for2es within that influen2e her7his pur2hase
beha6ior+ The maFor for2es in2lude moti6es, per2eption, learnin-, attitude and personality+
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1. Personal La2tors
These in2lude those aspe2ts that are unique to a person and influen2e pur2hase beha6ior+ These
fa2tors in2lude demo-raphi2 fa2tors, lifestyle, and situational fa2tors+
Consumer de2ision5ma3in- pro2ess -enerally in6ol6es fi6e sta-es*
Information Sear2h
Problem Re2o-nition

Pur2hase A2tion
Alternati6e E6aluation
Post purchase Actions
2onsumer Attribute affe2tin- 2hoi2e of format between or-aniDed and unor-aniDed Retail
17
18
#.! Retail o-tlet 0ele.tion and 9rand 0ele.tion8
There are three fundamental patterns, whi2h a 2onsumer 2an follow and they
2ould be*
9I: )rand first, retail outlet se2ond
9ii: Retail outlet first, brand se2ond
9iii: )rand and retail outlet simultaneously+
A 2onsumer wantin- to buy a 2ar may 2olle2t information on brands and pur2hase it from a retail
outlet based on his per2eption of pri2e offered or after sales ser6i2e pro6ided by the outlet
9typi2ally, sear2h for information on brands is followed by retail outlet sele2tion in durables:+ In
2ertain produ2t 2ate-ories, espe2ially where Q2ate-ory 3illersI e=ist, 2onsumers may thin3 of the
retail outlet initially and then the brands 9tele6ision, refri-erator and audio produ2ts retailed
throu-h outlets li3e ;i6e3 and Co+ in the South, 2ould be an e=ample:+
One more dimension may be to 2ompare brands in the e6o3ed set at retail outlets whi2h also
e=ist in an e6o3ed set of their own+ This is hi-hly possible, espe2ially in the Indian 2onte=t where
dealers de6elop a so2ial relationship with 2onsumers, espe2ially in semi5urban and rural areas+
Primary resear2h 2ould be used to dis2o6er the spe2ifi2 sequen2e in6ol6ed in a situation of this
3ind+ A Qbrand firstI dimension may need feature5based ad6ertisin- and a Qretail outlet firstI
dimension may require a set of point5of5pur2hase 9POP: materials and spe2ial trainin- to sales
personnel to re2o-niDe the needs of 2onsumers+
Brand %ir0t and o-tlet 0e.ond* The brand was probably thou-ht of by the 2onsumers be2ause5
9i: the 2onsumers may not ha6e de6eloped a relationship with any retailer whi2h is stron- enou-h
to -et into the Qe6o3ed retail setI or
9ii: the brand has -ot into the e6o3ed set be2ause of ad6ertisin- or positi6e word of mouth+ &o2al
ad6ertisin- with the mention of brand names whi2h ha6e already -ot into the e6o3ed set would
enable 2onsumers to be QpulledI to the outlet+ Primary resear2h may be required to identify the
brands in the e6o3ed set+
19
Organized 50 Unorganized Retail
20
:. Organized 50 Unorganized Retail8
In the de6eloped e2onomies, or-aniDed retail is in the ran-e of @.5>4 per 2ent of total retail,
whereas in de6elopin- e2onomies, the unor-aniDed se2tor dominates the retail business+ The
share of or-aniDed retail 6aries widely from Fust one per 2ent in Pa3istan and E per 2ent in India
to 1A per 2ent in )raDil and .. per 2ent in 'alaysia 9Table 0+0:+ 'odern retail formats, su2h as
hypermar3ets, superstores, supermar3ets, dis2ount and 2on6enien2e stores are widely present in
the de6eloped world, whereas su2h forms of retail outlets ha6e only Fust be-un to spread to
de6elopin- 2ountries in re2ent years+ In de6elopin- 2ountries, the retailin- business 2ontinues to
be dominated by family5run nei-hbourhood shops and open mar3ets+ As a 2onsequen2e,
wholesalers and distributors who 2arry produ2ts from industrial suppliers and a-ri2ultural
produ2ers to the independent family5owned shops and open mar3ets remain a 2riti2al part of the
supply 2hain in these 2ountries+
Ta9le "."8 S,are o% Organized Retail in Sele.ted 1o-ntrie0; "<<=
1o-ntr6 Total Retail Sale0 (US> 9n$ S,are o% Organized Retail (?$
SA 0,?>1 >.
Japan /,/>0 AA
China @>. 04
nited (in-dom E@. >4
Lran2e E1A >4
$ermany E0/ >4
India #"" :
So-r.e8 /lanet Retail and Te.,no@ak Ad5i0er0 /5t. 2td
21
N))D *OR STUDY
This study will 2ontributes to the understandin- that 2onsumers and retailers in most 2ases ha6e
different per2eptions in relation to store ima-e and shoppin- habits, Fustifyin- the need for
2onsumer mar3etin- resear2h, whi2h is important in helpin- retailers, implement in a real
mar3etin- orientation+ The study will e=amines the 2hoi2e of format the 2onsumer has when he
or she de2ides to buy a parti2ular produ2t and also des2ribes the de6elopment of or-aniDed retail
in the future, fo2usin- on aspe2ts with potential effe2t on pur2hasin- beha6ior amon- the
2onsumers+ The fo2us is on 2onsumer e=pe2tations+ The questions were formulated to 2apture the
o6erall beha6ior of the 2onsumers and with the help of the sur6ey questionnaire the analyses was
done+ An attempt has been made to e=plore the way or-aniDed retail has dramati2ally 2han-ed
not only the Indian traditional retailin- stru2ture but also the 2onsumption beha6ior+
22
OBA)1TI&)S
/: To identify the 6arious fa2tors that effe2t the 2hoi2e of format i+e or-aniDed or
unor-aniDed retail+
0: The types of -oods 2onsumers prefer to pur2hase from ea2h format
1: Lindin-s that 2an help the 2ompany -ain its 3ey stren-ths and wea3ness
S1O/)
The proFe2t too3 about two months to finish whi2h in2luded how mu2h 2ustomer are aware of
or-aniDed and unor-aniDed retail mar3ets and how well they differentiate both 3inds of retail
mar3ets in India+
2IMITATIONS
There was a limited time period+
Restri2ted to a limited area in 8yderabad7se2underabad+
E=plainin- 2ustomers about or-aniDed and unor-aniDed retail mar3ets too3 time+
&imited numbers of 2ustomers were 2hosen for sur6ey pro2ess+
The responses -i6en by respondents were not always a22urate be2ause the respondents
-a6e the response a22ordin- to their understandin-+
Sometimes the respondents are not willin- to fill the questionnaire and hen2e the
resultant may not be 2orre2t.
23
R)S)AR1' M)T'ODO2O+Y
Sam@ling De0ign8
/+ Samplin- unit Respondents of 9few malls:
0+ SiDe of sample /. respondents
1+ Sample 'ethod Random Samplin-
E+ Types of questionnaire Close ended
T6@e o% Data8
!ata type 2olle2ted for analysis is PRI'AR" i+e+ data has been obser6ed and re2orded by the
resear2hers for the first time to their 3nowled-e+ !ata 2olle2ted throu-h Fournals, newspapers <
internet is SECO#!AR" type+
Met,od o% data .olle.tion8
This study is a resear2h whi2h utiliDes interro-ation and obser6ation method for data 2olle2tion+
Se2ondary data was obtained from intensi6e analysis < obser6ation+ The primary data are those,
whi2h are 2olle2ted afresh and for the first time, and thus happen to be ori-inal in 2hara2ter+ The
se2ondary data, on the other hand, are those whi2h ha6e already been 2olle2ted by some one else
and whi2h ha6e already been passed throu-h the statisti2al pro2ess+ 'ethod employed to 2olle2t
data is Nuestionnaire+ This is a simple sur6ey 2ondu2ted by fillin- in questionnaire from the
people who 6isit malls+
1olle.tion o% t,e /rimar6 data8
As this study is of des2ripti6e type, the primary data has been 2olle2ted throu-h Nuestionnaire+
24
1'A/T)R-"
25

S(OT-ANA2YSIS
Strengt,0 *
Retailin- is a te2hnolo-y5intensi6eR industry+ It is te2hnolo-y that will help the or-aniDed
retailers to s2ore o6er the unor-aniDed retailers+ Su22essful or-aniDed retailers today wor3
2losely with their 6endors to predi2t 2onsumer demand, shorten lead times, redu2e in6entory
holdin- and ultimately sa6e 2ost+ E=ample* Jal5'art pioneered the 2on2ept of buildin-
2ompetiti6e ad6anta-e throu-h distribution < information systems in the retailin- industry+ They
introdu2ed two inno6ati6e lo-isti2s te2hniques S 2ross5do23in- and E!I 9ele2troni2 data
inter2han-e:+
On an a6era-e a super mar3et sto23s up to .444 S(Is 9Sto23 3eepin- nits: a-ainst a few
hundredMs sto23ed with an a6era-e unor-aniDed5retailer+
(eakne00 *
&ess Con6ersion le6el* !espite hi-h footfalls, the 2on6ersion ratio has been 6ery low in the
retail outlets in a mall as 2ompared to the standalone 2ounter parts+ It is seen that a2tual
2on6ersions of footfall into sales for a mall outlet is appro=imately 0450. per2ent+ On the other
hand, a hi-h street store of retail 2hain has an a6era-e 2on6ersion of about .45A4 per2ent+ As a
result, a stand5alone store has a ROI 9return on in6estment: of 0.514 per2entP in 2ontrast the
retail maFors are e=perien2in- a ROI of >5/4 per2ent+
Customer &oyalty* Retail 2hains are yet to settle down with the proper mer2handise mi= for
the mall outlets+ Sin2e the stand5alone outlets were established lon- time ba23, so they ha6e
stabiliDed in terms of footfalls < mer2handise mi= and thus ha6e a hi-her 2ustomer loyalty base+
O@@ort-nit6 *
The Indian middle 2lass is already 14 2rore < is proFe2ted to -row to o6er A4 2rore by 04/4,
ma3in- India one of the lar-est 2onsumer mar3ets of the world+ The I'A$ES5(SA proFe2tions
indi2ate that by 04/. India will ha6e o6er .. 2rore people under the a-e of 04 S refle2tin- the
enormous opportunities possible in the 3ids and teens retailin- se-ment+
26
Or-anised retail is only E per2ent of the total retailin- mar3et in India+ It is estimated to -row
at the rate of 0@ per2ent p+a+ and rea2h Rs+ /,1@,444 2rore by 04/4+
Per2olatin- down* In India it has been found out that the top A 2ities 2ontribute AA per2ent of
the total or-anised retailin-+ Jhile the metros ha6e already been e=ploited, the fo2us has now
been shifted towards the tier5II 2ities+ The Iretail boomI of whi2h >. per2ent has so far been
2on2entrated in the metros, is be-innin- to per2olate down to these smaller 2ities and towns+ The
2ontribution of these tier5II 2ities to total or-aniDed retailin- sales is e=pe2ted to -row to 0450.
per2ent+
Rural Retailin-* IndiaIs hu-e rural population has 2au-ht the eye of the retailers loo3in- for
new areas of -rowth+ ITC laun2hed IndiaIs first rural mall RChaupal Sa-aR offerin- a di6erse
ran-e of produ2ts from L'C$ to ele2troni2 -oods to automobiles, attemptin- to pro6ide farmers
a one5stop destination for all their needs+ R8ariyali )aDarR, started by !C' Sriram -roup,
pro6ides farm5related inputs < ser6i2es+ The $odreF -roup has laun2hed the 2on2ept of Ia-ri5
storesI named RAadhaarR whi2h offers a-ri2ultural produ2ts su2h as fertiliDers < animal feed
alon- with the required 3nowled-e for effe2ti6e use of the same to the farmers+ Pepsi on the
other hand is e=perimentin- with the farmers of PunFab for -rowin- the ri-ht quality of tomato
for its tomato purees, pastes
T,reat0 *+
If the unor-aniDed retailers are put to-ether, they are parallel to a lar-e supermar3et with little
or no o6er5heads, a hi-h de-ree of fle=ibility in mer2handise, display, pri2es and turno6er+
Shoppin- Culture has not de6eloped in India as yet+ E6en now malls are Fust a pla2e to han-
around, lar-ely 2onfined to window5shoppin-+
27
1'A/T)R-#
28
2IT)RATUR) R)&I)(
Mat,eB Ao0e@, and Mani0,a +-@taCSe@tem9er "<<D8 The Indian retail se2tor is boomin-
and moderniDin- rapidly in line with IndiaMs e2onomi2 -rowth+ In this re6iew the author tal3ed
about the impa2t of or-aniDed retailin- on traditional retailin-+ Jith the in2rease in number of
6arious formats for shoppin- li3e malls, departmental stores, hypermar3ets et2 the Indian
2onsumerMs preferen2es are 2han-in- towards and thatMs the reason forei-n in6estors li3e the
3in- of retail Jal5'art also 2ame into the Indian retail -round in 2ollaboration with )harti+
There is a hu-e untapped mar3et is present in India ri-ht now whi2h 2ontains a number of
opportunities for retailers+
Sen-"<<<8 Store Ima-e and Consumer Shoppin- 8abits* Indian Conte=t* In India, some
empiri2al studies pro6ide important information about 2onsumer beha6ior and its responses to
the de6elopment of or-aniDed retail+ E2onomi2al and so2ial 2han-es are maFor 2ontributors for a
-rowin- fra-mentation of 2onsumers into multiple se-ments with different 6alues and buyin-
priorities+ Consumers ha6e be2ome more pra-mati2, edu2ated and demandin-, learnin- how to
mana-e money and time more effi2iently+ The fo2us on low pri2es was -radually repla2ed by a
6alue for money perspe2ti6e+ The study de6eloped by ETI$ 9E2onomi2 Times Intelli-en2e
$roup, 0440: 2onfirms these tenden2ies+ Con2ernin- food, the most important attribute
mentioned was quality, followed by pri2e+ Indian 2onsumer has different reasons for preferrin-
different store formats, either modern or traditionalP Sen 90444: 2onfirms this in the study
underta3en in Indian 2onte=t+ 8e 2onfirms that in the 2ase of hypermar3ets, the main moti6es for
preferen2es, in de2reasin- order are low pri2es, the possibility of buyin- e6erythin- in the same
pla2e and the -eneral appearan2e of the store+ Se6eral in6esti-ations emphasiDe the possible
2oe=isten2e of different store formats 9Chandrase3har, 044/: and others point out the
29
relationship between the type of store and the type of produ2ts+ These studies show that, while
spe2ialiDed and traditional stores are preferred for fresh produ2ts, hypermar3ets are preferred for
shoppin- in -eneral, and also for froDen food, -ro2eries and be6era-es+ The pur2hase of
perishables in hypermar3ets is redu2ed+
Rad,akri0,nan; "<<#8 Traditional Retailers Per2eptions about Or-aniDed Retail
As already mentioned, or-aniDed retail has deeply 2han-ed the Indian 2ommer2ial stru2ture+
8owe6er, it is not e=2lusi6ely responsible, as other 2han-es 9e2onomi2al, so2ial and 2ultural
ones: ha6e o22urred simultaneously+ Con2ernin- the more dire2t effe2ts of or-aniDed retail on
different types of 2ommer2e, it is possible to 6erify that the maFor impa2t is felt on traditional
retail and, in parti2ular, on the food se2tor+ The impa2t of or-aniDed retail is also si-nifi2ant on
other types of retail, namely toys, stationery -oods and household applian2esP moreo6er, it is
probable that 2ompetition -ets more intense in other se2tors, su2h as 2lothin- and furniture+
RN1OS (Mar., !; "<<EF":-G @re00 relea0e0$8 In2reasin- trend of or-aniDed retailin- will
dri6e the -rowth of 2on6enien2e5store industry in the world+ )y 04//, Asia remains the fastest
-rowin- 2on6enien2e store mar3et in the world as the maFor Asian retail mar3ets re-istered
e=plosi6e -rowth in openin- up of new 2on6enien2e store+ Chan-in- 2onsumer preferen2es,
lifestyle and risin- in2ome le6el, whi2h is hea6ily influen2ed by e2onomi2 -rowth, remains the
maFor dri6in- for2e for 25store industry in the Asian re-ion+ as per R$lobal Con6enien2e Store
'ar3et AnalysisR+
30
C8APTER5E
31
Data anal60i0 and inter@retation
/: Are you aware of or-aniDed and unor-aniDed retail se2torT
a: "es b: #o
Interpretation * from this we 2an understand that out of /. 2ustomers with whom I ha6e
intera2ted only / does not 3now about or-aniDed retail mar3et and other 2ustomers are
aware of retail mar3ets+
0: Jhat 3ind of retail stores do you li3e to 6isitT
a: Or-aniDed b: nor-aniDed
32
Interpretation* it is 2learly shown that most of the 2ustomers prefer to 6isit or-aniDed retail stores
rather than unor-aniDed+
1: If or-aniDed whyT
a: ;ariety b: )etter ser6i2es
2: Assortment of produ2t d: E2onomi2al
Interpretation* from this bar -raph we 2an understand that most of the 2ustomers prefer
33
or-aniDed retail mar3ets be2ause of assortment of produ2ts and then 6ariety of produ2ts
and least see about the pri2e of the produ2ts+
E: If unor-aniDed whyT
a: Con6enient b: Credit fa2ility
2: 8ome deli6ery d: any other++++++++++++++++++++++++++++++
Interpretation* most of the 2ustomers prefer unor-aniDed retail mar3et be2ause of the
2redit fa2ility they -et and based on their 2on6enien2e+
.: Jhere do you li3e to pur2hase your L'C$ produ2tsT
a: Or-aniDed b: nor-aniDed 2: )oth
34
Interpretation* here we 2an see that most of the 2ustomers li3e to pur2hase their L'C$
produ2ts from both or-aniDed and unor-aniDed se2tors+
A: Jhere do you li3e to pur2hase your L'C! produ2tsT
a: Or-aniDed b: nor-aniDed 2: )oth
Interpretation* Lrom this bar -raph we 2an see that most of the 2ustomers li3e to pur2hase
produ2ts from or-aniDed L'C! produ2ts and few li3e to pur2hase from both or-aniDed and
unor-aniDed L'C! retail shops+
35
@: Jhere do you li3e to shop for your produ2tsT
a: &o2al outlets b: )rand outlets
2: Shoppin- 'alls d: others++++++++++
Interpretation* in this 2hart we 2an obser6e that the number of 2ustomers who li3e to shop
at lo2al outlets and shoppin- malls are equal and people who li3e to pur2hase at branded
outlets are few+
>: Jhat was your last pur2hased produ2tT
a: L'C$ b: L'C! C: Others+++++++++++
36
Interpretation* most of the last pur2hased produ2ts were L'C$ produ2ts by 2ustomers+
?: 8ow is your e=perien2e on your last pur2hased produ2tT
a: 8i-hly satisfied b: Satisfied
2: !issatisfied d: hi-hly dissatisfied
Interpretation* most of the 2ustomers are satisfied with their produ2ts and hardly
2ustomers are dissatisfied+
/4: Jhat is your reason for satisfa2tion7dissatisfa2tionT9ti23 either satisfied7dissatisfied and
answer:
a: ;ariety b: Con6enient
2: Assortment of produ2ts d: E2onomi2al
37
Interpretation* here we 2an see that almost all 2ustomers satisfa2tion and dissatisfa2tion
le6els are equal +and based on all four options -i6en their mind set 2han-es+
1'A/T)R-
38
*INDIN+S
CustomerMs preferen2es for -ro2ery shoppin- are -radually shiftin- from lo2al 3irana
stores to or-aniDed 2on6enien2e stores+
A-e is one of the most important fa2tors responsible for the 2han-in- preferen2e of
2ustomers+
Payment throu-h 2redit 2ards is in2reasin- pur2hases from 2on6enien2e store+
)rand Choi2e of 2ustomers is 2han-in- and this is also influen2in- shift from 3irana to
2on6enien2e store+ +
'a=imum no of 2ustomers belon-s to youn- a-e -roup+
'a=imum no of 2ustomers are male in malls due to family responsibility+
'a=imum no of 2ustomers are edu2ated and aware about retail store+
'a=imum no of 2ustomers are belon-in- to upper middle 2lass+
'a=imum no of 2ustomer are preferred Shoppin- 'alls for pur2hasin-+
'a=imum no of 2ustomers are time 2ons2ious and desire for many brand under one roof+
'a=imum no of 2ustomers are pri2e 2ons2ious so ma=imum 2ustomers belon-s to middle
2lass+
39
'a=imum no of 2ustomers did not 2ompromise quality with dis2ount and offers+
40
1ON12USION
The 2ustomers are attra2tin- towards shoppin- malls < retail outlets+
The shoppin- malls < retail outlets are tar-etin- to middle 2lass 2ustomers be2ause the
pur2hasin- power of this 2lass is rapidly -rowin- as well as the 2lass is also -rowin-+
The youn- -eneration is fashion < show5off 2ons2ious so retail outlets are mainly
fo2used on them+
'ost of the family wants to pur2hase from bi- showrooms and malls be2ause there are no
bar-ainin- system so the ha6e a trust that there is no 2heatin-+
The main stren-th of most of the retail outlets are pro6idin- attra2ti6e offers to attra2t
2ustomers+
)i- retail stores are runnin- 2ustomer loyalty pro-rams whi2h has in2reased profits and
no+ of 2ustomers+
Re.ommendation0 F /ro9lem0 to 9e o5er.ome
The first 2hallen-e fa2in- the or-aniDed retail se2tor is the 2ompetition from unor-aniDed se2tor+
In retail se2tor, Automati2 appro6al is not allowed for forei-n in6estment+
Ta=ation, whi2h fa6ors small retail businesses+
!e6eloped supply 2hain and inte-rated IT mana-ement is absent in retail se2tor+
&a23 of trained wor3 for2e+
&ow s3ill le6el for retailin- mana-ement
#eed to ha6e more updated and fresh sto23s+
41
Bi9liogra@,68
$oswami+ P and 'ishra+ ', 044?, Jould Indian 2onsumers mo6e from 3irana store to or-aniDed
Retailers when shoppin- for -ro2eries, Asia Pa2ifi2 Journal of 'ar3etin- and &o-isti2s, ;ol+ 04,
#o+ /
ICRIER Fournal paper, September 044>
http*77ssrn+2om7abstra2tU??E01>
)OO(S*5
'ar3etin- 'ana-ement+ 5555(otler < (eller
'ar3etin- 'ana-ement in Indian Perspe2ti6e
5555;+ S+ Ramaswamy < S+ #ama3umari
Retail mana-ement 555&e6y < JeitDs
JE)SITES*5
BBB.emraldin0ig,tF!#-D.,tm
BBB.*i9re"%a0,ion..omFind-0tr6-arti.le
www+tataretail+2om
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www+retailyatra+2om
www+retailbiD+2om
www+aboutus+2om
BBB.9-0ine00Borld.in
42
ANN)HUR)
IU)STIONNAIR)
A STUDY ON OR+ANIJ)D AND UNOR+ANIJ)D R)TAI2 MARK)TS IN
INDIA
#A'E* ++++++++++++++++++++++++++++++++++++++++++++++++
A$E * ++++++++++++++++++++++++++++++++++++++++++++++++
OCCPATIO#* ++++++++++++++++++++++++++++++++++++++++++++++++
/: Are you aware of or-aniDed and unor-aniDed retail se2torT
a: "es b: #o
0: Jhat 3ind of retail stores do you li3e to 6isitT
a: Or-aniDed b: nor-aniDed
1: If or-aniDed whyT
a: ;ariety b: )etter ser6i2es
2: Assortment of produ2t d: E2onomi2al
E: If unor-aniDed whyT
a: Con6enient b: Credit fa2ility
2: 8ome deli6ery d: any other++++++++++++++++++++++++++++++
.: Jhere do you li3e to pur2hase your L'C$ produ2tsT
a: Or-aniDed b: nor-aniDed 2: )oth
A: Jhere do you li3e to pur2hase your L'C! produ2tsT
a: Or-aniDed b: nor-aniDed 2: )oth
@: Jhere do you li3e to shop for your produ2tsT
43
a: &o2al outlets b: )rand outlets
2: Shoppin- 'alls d: others++++++++++
>: Jhat was your last pur2hased produ2tT
a: L'C$ b: L'C! C: Others++++++++++++++++++++
?: 8ow is your e=perien2e on your last pur2hased produ2tT
a: 8i-hly satisfied b: Satisfied
2: !issatisfied d: hi-hly dissatisfied
/4: Jhat is your reason for satisfa2tion7dissatisfa2tionT9ti23 either satisfied7dissatisfied and
answer:
a: ;ariety b: Con6enient
2: Assortment of produ2ts d: E2onomi2al
44

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