Semester V

from
French
word
RETAILLIER
RE+TAILLIER =RE+CUT
Historically it was viewed as sale of goods to
consumers through shops
In modern days it is viewed as sale of tangibles and
intangibles to the consumer through brick and mortar
format as well non brick and mortar format.
Retailing does not have to include a store
Phone orders , direct selling , web transaction and
sale through vending machine all are retailing

Derived

Evolution of Indian Retail

Historic

Traditional

Government
Supported

Modern Formats/
International

Exclusive Brand
Outlets/
Shopping Malls
PDS Outlets
Khadi Stores
Cooperatives
Convenience Stores
Mom and
Pop/Kiranas
Weekly Markets
Village Fairs
Melas
Source of
Entertainment

Neighborhood
Stores/Convenience

Availability/ Low
Costs /
Distribution

Shopping
Experience/Efficiency

Buying & Merchandising.

Five golden rules:1. Right merchandise.

2. Right time.
3. Right Place.
4. Right Price.
5. Right stock qty.

Store Planning and Operations

1. Space Management
2. Ambience/ Services.
3. Visual Merchandising The silent seller.
4. Customer management.
5. Inventory management

CLASSIFYING RETAIL OUTLETS

Ownership

Level of Service

Classification
of
Retail
Formats

Merchandise

Price

CLASSIFICATION BY OWNERSHIP
Independent
Retailers-one store
ownership

Chain Stores-many stores

but only one owner

Franchises-many owners
of many stores

Cooperatives member
consumers are the owners

Leased

 Owns and operate only one retail outlet

Managed by owner / proprietor and a few other family

members ( Generation shops)

Local baniya / Kirana store / paanwala
One to one rapport with customer
Limited bargaining power with supplier

 Two or more outlets under common ownership

Commonality in terms of MERCHANDISE ,

AMBIENCE ,ADVERTISING , PROMOTIONS

Very high bargaining power with supplier
City and regional preferences ignored
Pantaloons , Shoppers Stop , West side , globus
, Wills Sports, Arrow etc.

 Franchiser: The originator of a trade name, product,

methods of operation, and so on that grants operating

rights to another party to sell its products.
Franchisee: An individual or business that is granted
the right to sell another partys product.

 Contractual agreement between franchiser and franchisee which allows the

franchisee to conduct business under an established name as per a

particular business format in return for a fee or a compensation .
Such type of ownership enriches the Franchiser as the Franchisee are

entrepreneur who bring their business skills to grow the business of

Franchisers.
Ineffective / Bad Franchisee may harm the reputation of the Franchiser

BASIC FORMS OF FRANCHISING

Product and
Trade Name
Franchising

Business
Format
Franchising

Dealer agrees to sell certain

products provided by a
manufacturer, but can use any sales
tactics he chooses.
Archie's
Dealer must sell the franchisers
product in the exact way the
franchiser prescribes.
Ex McDonalds, Planet Fashion
Stores

 Also termed as Shop-in Shops

A section of a space is leased to an outside party

Retailer expands its product offering to the

customers
Perfumes / cosmetic counters in department stores
The proprietor of leased department is responsible
for all aspects of its business and normally pays a
percentage of sales as rent .
The store sets operating restrictions for the leased
department to ensure overall consistency and
coordination .

 Consumers invest in the enterprise

Profits are distributed among the members as dividends
Stores managed by elected officials
Apna bazar ,Super bazar ,Kendriya bhandar ,Sahakari

bhandar

CLASSIFICATION BY LEVEL OF
SERVICE

Self
Service

Full
Service

MAJOR TYPES OF RETAILERS BY PRODUCT

OFFERING
Kirana Stores
Convenience Stores
Supermarkets
Departmental Stores
Hypermarkets
Specialty Stores

Off Price Retailers

Catalogue Retailing
Category Killers
Warehouse Clubs
Restaurants

 Neighborhood / residential areas / Independent

retailers
Food oriented
Eased / personalized/ emergency purchase
2-3 times a week
Convenience products
Open for long hours
Home delivery and monthly credit

 Neighborhood food oriented store open for long hours

Moderate number of items (more than kirana )
The store size is relatively larger than kirana and provides better

customer service in terms of ambience ,packaging , presentation and

quality.
Prices are not as competitive as other formats like supermarket
,department stores but certainly on the lower side than the kirana
stores.
The ease of shopping at convenience store in terms of time and
impersonal nature of supermarket makes these stores more appealing .
According to FMI : A small local store selling mostly grocery , open
until late at night or even 24 hours a day and is abbreviated as c store
The store size is 3000-8000 sq ft
Stores in petrol pumps like HP Speed mart, In and Out.

 Food store offering groceries and limited range of

non food items / general merchandise ie health

and beauty aids , gift items
Large stores ,low priced , low margin , high volume
, self service operations
85% food and grocery items
Impulse buying
8000-20000 sq ft
Nigiris , Foodworld, Subhiksa , Food Bazar ,
Spencers, Spinach, More , Reliance Fresh

Large stores selling several product lines with each operating as a department under
one roof.
Product mix is largely non food like apparel , accessories ,books , music , footwear .
20000- 40000 sq. ft.
Target customers are not price conscious
Ambience / VM plays important role.
National brands as well private labels
Merchandise return policy and loyalty programs
Anchors in a shopping mall
They help in attracting high traffic
30% conversion rates
Atleast 50 employees
50000- 100000 SKUs
Shoppers Stop , Pantaloon , Lifestyle , Westside , Globus , Akbarallys , The Bombay
Store , Benzer , Ebony , Chermas , Meena Bazzar .
International players like Marks & Spencer , Sears , J.C.Penny .

 Derived from the French word Hypermarche which is a combination of

a economy supermarket and a discount department store .

Also termed as supercentrees
Carrefour started first hypermarket in 1963
A store with 80000-2,20000 sqft. with at least 35% of selling space
devoted to non grocery product like clothes , jewellery , hardware ,
sports equipment , books , CDS /DVDS , Videos , TV , electric
equipments .
One stop shopping
Cheapest Pricing
Wal Mart (the Wal-Mart supercentres), Carrefour, Target ( Super
Targets) , Tesco (Tesco Extra Stores), Big Bazaar , Star India Bazaar ,
Hypercity, D-Mart , Vishal Mega Mart

 A retail store specializing in a particular type of merchandise or single

product line with deep assortments in that product line

Such business model is characterized by high level of customer service

or product information

Concentrate on apparel , jewellery ,drugs, fabrics , sporting goods , Car

/ Scooters , furniture etc.

8000 sq.ft.
The Gap , Ikea , Proline fitness centre , Croma , Kings electronics

 Merchandise is sold at less than retail prices

Buys manufacturers seconds , off seasons at a deep

discount
The merchandise may be in odd size ,unpopular colors or
with minor defects
Manufacturer owned / Factory outlet (Pantaloon Factory
outlets, Levys factory outlet etc.)
Parental company to expand their business

 A retail outlet selling durable products and other high

mark-up merchandise from a catalogue.

BUYER'S choose items from the catalogue and
complete an order form which is then processed in
store .

 A specialty retailer who offers a very large selection in

the chosen product category and economical prices

Focus on one product category, they stock deep ,
dominate the product category
20,000-1,20,000 sq.ft.
Nallis in saris, Trouser Town in Trousers, Toys Kemp in
Toys , The Loft in footwear.

 A limited-service merchant wholesaler that sells

appliances, household items, and groceries on a cashand-carry basis to members, usually small businesses
and groups

 Sell tangible products, food and drink, but also

provide valuable service.

NON-STORE RETAILING
Automatic Vending
Door to Door, Party plan,
Multi level networking ,Tele Marketing
(TV , postal mail/ catalogue

Major Forms
of
Nonstore
Retailing

Electronic Retailing

 Banks
Hotels
Hospitals
Education
Airlines
Car Rentals

Housekeeping