Retailing - An Overview

Retailing An Overview


Retailing a set of business activities that adds value to the products and services sold to consumers for their personal or family use. A retailer is a business that sells products and/or services to consumers for personal or family use
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Retailing in Supply Chain

Manufacturing, Wholesaling & Retailing

Vertical Integration  Backward  Forward


Retail Terminology
Break Bulk  Hold Inventory


Buy it at a convenient place when you want it.

Provide Assortment  Offer Services



Layaway, Credit, See it before you buy

How Retailers add Value

The value of the product and service increases as the retailer performs functions
Bicycle can be bought on credit or put on layaway Bicycle is featured on floor display Bicycle is offered in convenient locations in quantities of one Bicycle is developed in several styles Bicycle is developed at manufacturer

Retailing in U.S.A.
Over $ 3.5 trillion sales annually (2005)  Employs 27 million people

Wal-Mart data warehouse contains over 425 terabytes of data, almost twice as much data as contained in the World Wide Web

Wal-Mart buys merchandise from over 5000 different factories located in 60 countries

Retailing is a big part of economy

Manufacturing (11.2%) Retail (21.8%)

Government (16.6%)

Services (45.8%)

Other 5.6%

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Nature of Retail Industry is Changing

To Todays Retailer

Mom and Pop Store

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Retailing in India
     

One of the largest industries in India Second largest employer after agriculture in the country $70 billion by 2010 (organized sector) To touch US$ 590 billion in the next two years (Both) Estimated to grow at 13 per cent per annum from US$ 322 billion in 2006-07 to US$ 590 billion in 2011-12. Accounts for 12 percent of its GDP and 8 percent of the employment

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Major Retail Players in India

        

Pantaloon
Pantaloons, Lifestyle, Big Bazzar, i-collection, Home Town

Raheja
Globs, Shoppers Stop

Relinace
Reliance Mart, Reliance Fresh

RPG
Food World, Giant, Music World, Health n Glow

Tata
Westside

Landmark Piramal
Cross Roads

A V Birla
More

ITC
Wills Lifestyle
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Retail Global View

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Indian Retail Scenario

Technology Incentives Super Market Stocks Rising Disposable Income Increase in Number of People in Earner Category Strength Opportunity Large Consumer Market Growth of Organized Sector Rural Retailing Potential for Investment Low Conversion Level Customer Loyalty Underdeveloped Supply Chain Lack of adequate Utilities

Weakness Threat High Unorganized Market Shopping Culture Poor Inventory Turnover and Poor Stock Availability Measures Inflation

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Organized / Unorganized Retailing

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Organized Retailing
Share of Organized Retailing across the Globe 1999 Total Retail Organized Retail % share of Organized Retail 150 1.1 0.7 2002 180 3.3 1.8 US $ B 2005 225 7 3.2

Share of Organized Retailing in India 1999 Total Retail Organized Retail % share of Organized Retail 7000 50 0.7 2002 8250 150 1.8

INR M 2005 10000 350 3.5

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Shopping Trends in India

Type of Store Hypermarkets Supermarkets Convenience Stores Personal Care / Drug Stores Others Percentage of People 1 17 10 52 20 Indian Shoppers Attitude for Trying New Things % of Indians Love to try new things Dont waste time on new things Keep up with things but dont go out of their way to try new things 48 13 39

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Fact Sheet about India

            

India is the 4th largest economy in terms of PPP after USA, China & Japan India is touted to be the 3rd largest economy in terms of GDP in next 5 years It is the 2nd fastest growing economy India in 2010 grew at% Among top 10 FDI destination Stable government with 2nd stage reforms in place Growing corporate ethics Major tax reforms US$200 b plans in IR in next 5 years 2nd most attractive developing market ahead of Has the largest young population in the world More English speaking people in India more than whole of Europe 600 million middle class (by 2010) - The real consumers, the largest consumer market of the world.

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Reasons for retail boom in India

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Marketers Choice of Top 20 Small Towns

Town 1 2 3 4 5 6 7 8 9 10 Chandigarh Jalandhar Thane Coimbatore Madurai Jodhpur Cochin Trivandrum Agra Vijayawada 11 12 13 14 15 16 17 18 19 20 Patna Nashik Vizag Rajkot Guwahati Mysore Meerut Gwalior Kota Amritsar
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Town

Organized Retailing in India



Entry of large business houses

Started in Chennai and Hyderabad

Apparel Retailing Food Retailing Health & Beauty Footwear Retailing Music and Entertainment

Books Watches and Jewelry Petrol and Diesel Home Furniture Luggage

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Retail Segments in India

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A Profile of Major Indian Retailers



Pantaloon Retail India Limited

Headed by. Pantaloons, Big Bazaar, Food Bazaar, Gold Bazaar, Music Bazaar, Central, Lifestyle, Home Town, i-collection, Brand Factory Incorporated in 1987 as Menz Wear Pvt Ltd., became a public ltd. in1991 Brand name Pantaloons, John Miller, Color Plus CSR initiatives Big Bazaar, Wednesday, Is se sasta aur accha kahi nahi Food Bazaar 6 hot shops at Food Bazaar


Farm Fresh, Chill Station, Golden Harvest, Chef Zone, Hungry Kya, Head-to-toe

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A Profile of Major Indian Retailers



RPG Group
Power, Tyre, Retail, Transmission, Entertainment, Technology and the specialist sector Food World, Spencers Introduce reverse auction Introduce bar code scanners Health & Glow A JV between RPG and Daily form Internationals

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A Profile of Major Indian Retailers



Tata Group
Information systems and communication, engineering, materials, services, energy, consumer products and chemicals Tata sold its Lakme to HLL in 1997 1998 purchased Littlewood international (UK Firm) renamed as Trend Ltd. and the store named as Westside Introduced in-house labeling Star India Bazaar Titan Industry (A JV between Tata and Tamil Nadu Industrial Development Corporation (TIDCO)) Titan and Sonata (25% Market Share) (Fastracj, Edge, Nebula, Raga, Regalia. Das, Bandhan and Steel Fastrack I-Gear Sunglasses Tanishq

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A Profile of Major Indian Retailers



Raheja Group
Shoppers Stop (1991) Introduced Retail-ERP The first citizen Crossword Books Store

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Ajay Bijli

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Nikhil Chaturvedi

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Aditya Birla Group

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Retailing Environment
 

Economic environment Legal environment

Restriction on Foreign Direct Investment (FDI),
 

1997 NK Singh Committee Real Estate - PSFPM Labor Laws

Property regulations, and

 

Complex taxation system

 

Technological environment Competitive environment

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Retail Mix
Customer Service Location

Store Design and Display Retail Strategy

Merchandise Assortment

Communication Mix

Pricing

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Retail Mix
Location Strategy
Enclosed malls Free-standing Stores

Customer Service

Store Display And Design Merchandise Assortment

Communication Mix

Pricing

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Retail Mix
Assortment Strategy

Customer Service Location

Store Design and Display

Many Items in Apparel and Soft Home

Large Number of Categories Private Labels Few Items in Each Category
Pricing

Communication Mix

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Retail Mix
Location

Pricing Strategy
Customer Service Merchandise Assortment

Store Design and Display

Communication Mix

Modest with Sales

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Retail Mix
Customer Service Location

Communication Mix

Store Design And Display Merchandise Assortment

Pricing

TV and Magazine Ads Special Events

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Retail Mix
Store Design and Display

Bright, fashionable and fun boutique layout Racetrack with Displays Colorful, wide aisles displays for products with a grid layout

Customer Service

Location

Merchandise Assortments

Communication Mix

Pricing

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Retail Mix
Customer Service
Modest
Location

Merchandise Assortment

Store Design and Display Pricing

Communication Mix

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Myths about Retailing

      

Sales clerk is the entry-level job in retailing College and university degree are not needed to succeed in retailing Retail jobs are low paying Retailing is a low growth industry with little opportunity for advancements Working in retailing requires long hours and frequent relocation Monotonous Retailing doesnt provide opportunities for women and minorities
47% Of all retail employees have college education and 27.1% have college degrees
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Career in Retailing


Entry level management positions

Department manager or assistant buyer/planner Manage and have P&L responsibility on your first job

Most entry level jobs are in store management or buying, but theres
Accounting and finance Real estate Human resource management Supply chain management Advertising Public affairs Information systems Loss prevention Visual merchandising
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Questions I would like to ask!!!

   

  

Give the name of non-traditional but organized retailers? Do consumers perform some of the functions performed by retailers, wholesalers and manufactures? Suppose the local grocery store markups all its products by about 50%? Is the grocery store profitable? Describe the difference in the assortments of bicycles provided by WalMart and the local bike shop. What is the difference in assortment of CDs provided by the local music store and Kmart? What are the product categories for which holding inventory is particularly appealing (e.g., seasonal items) What kind of services do retailers provide? How a computer retail store can increase the value of a computer for a consumer. Compare the service of a computer store with an on-line store like Dell. What examples of community support they have seen from local retailers?

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Questions I would like to ask!!!



What type of changes in the retail industry may take place in the 21st century. How is technology affecting the changes in this industry? Will consumers still go to stores or will they buy everything from a computer in their houses? What will stores look like? How will they adjust to the Internet? Who will be the big winners/losers? What are the changes occurring in the environment now that will affect retailing in general and specific retailers.

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Some of the services retailers do provide:

          

Acceptance of credit Cards, Alteration of merchandise, Assembling of merchandise, Bridal registry, Check cashing, childcare facilities, Credit, Delivery to home, Demonstrations of merchandise, displaying merchandise, dressing rooms, gift wrapping, layaway plans, Parking, personal assistance in selecting merchandise, personal shoppers, play areas for children, Presentations on how to use merchandise, Provisions for customers with special needs (wheelchairs, translators), Repair services, Rest rooms, special orders and warranties

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