Retail Basics

The session has been packed with information which has been compiled by us to give you not just an overview of Retail Market but also some insight!!.. Retail, according to Concise Oxford Dictionary, is the the sale of goods to the public for use or consumption rather than for resale. The barter system was the first known Retail form; then the currency changed hands; we had the hand cart vendor selling goods in the streets; of late we have the pop and Mom stores which compliment the neighborhood stores. The first Retailers in India include Bata, Pantaloons, Bombay Dyeing, Spencers, Nilgiris and Higginbothams. The current retail scenario is controlled by the likes of Shoppers Stop, Brand Outlets, Big Bazaars and The likes. The top three world players include Wal-Mart, Carrefour, Tesco and Metro. The opportunities as mentioned are aplenty with close to 1, 50,00,000 sq ft of retail space is under construction for various malls and shopping centers across the country. Basics of Retail: The Indian market is worth whopping 9,90,000 cr. If one has to divide between the organized and the unorganized sectors the major contribution comes from the unorganized market which contributes close to 95% of the total retail market. The balance of 5% is the organized market. The difference between the organized and the unorganized retail sectors in the US and some of the Far East Asian countries is pretty low unlike in India. With the advent of seasoned players in the field of retail in India, the gap is likely to be abridged in the coming years. The difference between them is 85:15 in favor of the organized sector in the US and 81:19 in the favor of the organized sector I Taiwan.
Workshop on Retail Marketing Skyline Business School

The employment opportunities in retail are pretty high. But again the ratio of the organized and unorganized is skewed onwards the unorganized sector. While the organized retail sector deploys 5,00,000 people the unorganized sector deploys close to 80 times the workforce. Having said that, getting into the details of the way the retail set up is there in India we have the two different types. One the store based and the other non- store based. The store based can be classified further into product, Price , Ownership and service based outlets whilst the non- store based retail outlets would consist of online, Direct, catalogue and TV retail. When we talk about Product based retail outlets they would cover General Merchandise, food Retailing, Service Retail and Food Service Retailing. The price base retail outlets would cover the Factory outlets, single price outlets (via) the dollar store, Closeout outlets and the Category Killers. Ownership based retail outlets would ideally cover the corporate retail outlets. The service based retail outlets encompass full service, limited service, self service and the vending machine. What are the factors that influence the growth in retail? The DINK (double income no kids)/HINK (High income no kids) families, working women, working parents and the rising disposable incomes has contributed to the growth of retail cross. The middle income group is the fastest growing segment in the country today. Further the electronic media is also aiding the growth of the retail industry. To summarize the top 6 factors that drive the growth of the retail industry in India would be as follows: The Demographics Lifestyle Needs and Desires

Shopping attitudes and Behavior

Workshop on Retail Marketing

 Retailers action Environmental Factors These six factors clubbed with a co-coordinated logistics makes the sale happen. As in any industry there is a social commitment also to be fulfilled. These can be recapitulated as under.

Quality products Competitive Prices. Employment opportunities that are created

Wide Range to choose from.

The economy would experience sea change and Would mean a WIN situation to everyone. Formats in Retail

Departmental Stores: These are basically large stores catering to a variety of consumer needs. These can be further categorized into departments such as clothing, toys, home, groceries, etc. eg: Shoppers Stop.

Specialty stores are usually chains of stores that specialize or concentrates on selling one kind of a product or service (or a specific range of merchandise) like: Ferns & Petals.

Hypermarkets are large self service outlets which serve a variety of goods to cater to the diverse needs of customers. Such stores contribute hugely to food & grocery requirements of people. eg: Hyper City(Shoppers Stop) in Mumbai.

Discount stores or factory outlets are those stores that offer discounts on the MRP through selling in bulk reaching economies of scale or excess stock left over at the season. eg: Factory Outlets at Mahipalpur.

Workshop on Retail Marketing

Skyline Business School

Convenience stores are relatively small stores that are usually located near residential areas. Prices are slightly higher due to the convenience premium.They are also located at Petrol Pumps. eg: In &Out Stores.

For your understanding of the formats better there is a table which shows the difference between all the formats in the Indian Scenario.

Difference between Organised Vs Unorganised Markets. Organized Vs Unorganized Retail Professional Management Organized retailing employs professional to manage their retail outlets. Recent days they recruit from B schools and other institutions where they are specialized in the industry.
Workshop on Retail Marketing Skyline Business School

Supply Chain Management (SCM) and Logistics Organized retailers invest heavily on SCM as it is the back bone of the industry. With an efficient SCM, they ensure that the right products are there at the right place at the right time or in short availability of the product. Most of us might have experienced out of stock issue in a kirana stores as he does not have a mechanism to see which product is in stock or out of stock.

Uniform Pricing As organized retailing uses central buying methods, the prices are uniform across their outlets as most of the time it is mechanized using retail systems. Also they use their buying power to bring down the cost. In case of a kirana stores they will alter the prices as per their wish depending upon the types of customers Infrastructure The look of a organized retail is always appealing that a customer goes there at least to do a window shopping. Most of the unorganized retailers do not invest much on the infrastructure and continue to operate with the existing style. Shopping Experience With the advanced infrastructure and other initiatives, modern retail stores give a great experience to their customers!!.

Workshop on Retail Marketing

Skyline Business School