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Facilitator: Prof: Sreekumar B.Pillai. Head of Retail and Merchandising.

Copyright:Sreekumarpillai,SCMS

Session Objectives.
To introduce the subject of Retail

Management by exploring the retail concepts and environment. To examine the present retail market on national as well as international levels.

What are channels of distribution?


Channels of distribution are pathways for the

goods and services to be transferred from the manufacturer to the consumer at the optimum cost,convenience and speed. There are many types of channels of distribution that are in operation.

Common channels of distribution


Manufacturer

Distributor

Retailer

Consumer

Channels of distribution:
Manufacturer

Retailer

Consumer.

Channels of Distribution:
Manufacturer

Consumer

What is retailing ?
Retailing is the sum of all the marketing activity that are

undertaken by a component of the supply chain when it is involved in selling goods or services directly to the consumers for their personal, family or household use. than 50% of their sales revenue through direct sale to the customer. greatly in size, organisation ,nature of product/service offering and sales strategies.

According to the ARA such a retailer should have more

Though they have the same basic function retailers vary

Study of the Planning,implementing,controlling and

directing the processes that lead to the transfer of goods from the retailer to the consumer constitutes Retail management

Functions of a Retailer:
Form utility: Offers goods in the form and

quantity that is required by the consumer(ready to use). Time utility: the shops are open during times when customers want to shop. Place utility: proximity to the customer. Ownership utility: easy and legal transfer of ownership.

W o r ld In d u s t r ie s
0 0 0 0 T rillio n s o f U S D 0 0 0 0

R e t a il fi n a n c i a l C h e m ic a l E le c t ro n ic s 0 In d u str ie s 0 A u t o m o b ile

E n g in e e rin g

packaged g

Key Players in the world of retail:


Fortune Rank Corporation: Origin Revenues $ Mn No: Employees

1 22 34 42 49 54 57 82 86 105

Wal-Mart Stores Carrefour Home Depot Metro Royal Ahold Tesco Kroger Target Costco Albertsons

U.S.A. France U.S.A. Germany Netherlands U.K. U.S.A. U.S.A. U.S.A. U.S.A.

287,989 90,380 73,094 70,159 64,675 62,458 56,434 49,434 48,107 40,052

1,700,000 430,000 273,000 208,616 201,000 242,980 289,000 292,000 273,000 241,000

Indian Retail highlights.


Indian Retail market is currently valued at Usd 330 Billion per

annum. The organised sector is now 8% of the total market and was growing at 49% per annum till Sep 08.The current growth rate is estimated to be around 35%. India has 12 million retail outlets which is the highest in the world. The per capita- retailing space is 2 sqft(16 sqft in the US), 96% of all Indian retail outlets are below 500 sqft. Retail sector is the second largest employer in India after The agricultural sector accounting for 97 Million people. The retail industry has the potential to employ 3.5 lakhs of Indians during 2010-2011.

Quick Stats (Indian Retail) Markets Market size (total) 2006: US$ 300 bn/annum Market size (total) 2011: US$ 427 bn/annum Market size (total) 2015: US$ 637 bn/annum Market size (modern retail) 2008: US$ 12 bn/annum Market size (modern retail) 2011: US$ 60 bn/annum Annual rate of growth (modern retail): 35% Penetration (modern retail) 2006: 3 to 4% Penetration (modern retail) 2010: 10% Number of retail outlets (total): 12 million

Indian Retail scene:


Retail Space
Typical space per outlet: 100 to 500 sq.ft. Space occupied (modern retail): 35 mn sq.ft. Operating Malls 2008: 114 (25 mn sq.ft.) New Malls under construction: 361 (117 mn

sq.ft.) New space distribution: 65% (top 7 cities), 35% (tier II & III cities) New space distribution (among top 7 cities): NCR 34%, Mumbai 23%, Rest 43%

Investment
New Investment by 2011: US$ 30 bn

Employment
No. of persons employed (total): 97 mn No. of new jobs in next two years: 1.5 mn.

Break up of consumption of goods/services by the Indian consumer:


0 % 0 % 0 % 0 % 0% 0 0% 0 0 % Food Transport Clothing & Footwear Rent Recreation Furniture Medical Care 0% 0 Other

Size of the organised Indian retail market in crores of Rs:


2001-02 2007 CAGR(%)

Total

16,000

37,216

18

Food

1,800

7473

33

Clothing

4950

10,423

16

Consumer durables

1650

3787

18

Books &music

450

1,426

26

Comparison of Organised Vs Unorganised sector compositions for Various countries.

Structure of traditional Grocery retailing in India.

Grocery Retailing

Fresh Groceries

Branded packaged foods

Dry Unprocessed Groceries

Personal hygiene & toileteries Soaps,shampoo, creams

Vegetables,fruits Milk ,meat The local Vegetable/fruit Vendor.

Biscuits,chips etc

Rice,pulses,sugar

Local Baniya/govt ,fair price shops, Cooperatives,Kiosks

Indian Retail Scene:


Food & Grocery Non-Food Groceries Apparel Arrow,Lee,Levis,Benetton,Wesstside,Wills sports, Food world Nilgris Spencers varkeys More Books&Music,stationary: Crossword,Planet M,Archies,Music world, Reliance time out. Mango,Chennai silks

Restaurants & fast Food:

Electronics: Next,QRS,Viveks,Nandilath-G-mart

Mac Donalds Pizza corner Barista Coffee day Dominos Chic king

Jewellery. Tanishq,Joy Allukkas,Bhimas

Beauty: Lakme,shanaz herbals.

References: Retailing by George Lucas,Robert Bush and Larry Gresham ,1997 First Edition ,All India Publishers and Distributors.
Principles of Retailing by John Fernie,Suzanne

Fernie & Christopher Moore,2007 First Edition, Butterworth-Heinemann.Oxford.

Retail Management A strategic approach by

Barry Berman & Joel.R.Evans , 2005 Eighth edition, Pearson Education Singapore

Thank you.