A
Project Study Report
On
Titled
“An empirical study on consumer preferences while
Selecting organised retail shop in udaipur city.”
Submitted in partial fulfillment for the
Award of degree of
Master of Business Administration (2007-09)
PACIFIC INSTITUTE OF MANAGEMENT, UDAIPUR.
Submitted By:DEVENDRA KUMAR PITLIYA
MBA PART II
Submitted To:Mr.SHIVOHAM SINGH
ASSISTANT PROFESSOR
PREFACE
To excel in any field practical training is an integral part to imply theoretical studies to a practical
approach. It makes the individual to the actual practical conditions, which could have been
impossible to be tough in classroom? A trainee learnt dealing with the workers and management
working environment along with operational skills.
I have great pleasure by having my project title “An empirical study on consumer
preferences while selecting organised retail shop in udaipur”
The project is a sincere attempt to focus on the subject in a lucid manner.
I make an effort to carry out a survey and a study deep on a subject. During a survey, I get
result that what is customer preferences while purchasing retail shop in udaipur customer are
satisfied or not.
2
Acknowledgement
I express my sincere thanks to my project guide, Mr. Shivoham singh, Designation assistant
professor, pacific institute of management studies (udaipur), for guiding me right form the
inception till the successful completion of the project. I sincerely acknowledge him for
extending their valuable guidance, support for literature, critical reviews of project and the
report and above all the moral support he had provided to me with all stages of this project.
I would also like to thank to Dr. B.P. Sharma, director of pacific institute of management
studies (udaipur) for their help and cooperation throughout our project.
(Signature of Student)
Devendra Kumar pitliya
3
EXECUTIVE SUMMARY
I have done my major research project on “an empirical study on consumer preferences
while selecting organised retail shop in udaipur city”
My objectives are:1. To find out the customer preferences while selecting organised retail shop in udaipur
City.
2. To find out the various factor which affect purchase decision.
3. To find out the customer satisfaction level at various retail shop in udaipur city
This project has been a great learning experience for me; at the same time it gave me
enough scope to implement my analytical ability.
In first chapter of this report, the Introduction about the retail About Industry. In The
second chapter the details about the organization profile & products in the third chapter
about the objectives and research methodology. the forth chapter covers the analysis of
data collection and interpretation .the fifth chapter consists of findings and conclusion.
The sixth chapter consist of suggestion. The last chapter that is seventh consists of the
Limitation of the Study.
The project assigned was based on finding preferences while selecting organised retail
shop in udaipur. The methodology of sample selecting survey was conducted in around
50 sample were collected . The opinion of all these respondents were collected and
analyzed, for data collection survey technique was used in which a questionnaire was
prepared consisting of close ended questions.
All the topics have been covered in a very systematic way. The language has been kept
simple so that even a layman could understand. All the data’s have been well analyzed
with the help of charts and graphs.
4
CONTENTS
 Acknowledgement
 Preface
 Executive summary
S.No.
CONTENTS
PAGE
No.
1.
Introduction to the Industry
2.
Introduction to the Organization
47
3.
Objective & research methodology
62
4
Analysis and Interpretation
6
64
5.
Finding
90
6
Recommendation and Suggestions
93
7.
Limitation
95
8.
Appendix
97
9.
Bibliography
101
5
INTRODUCTION OF RETAIL
INDUSTRY
6
INTRODUCTION
The India Retail Industry is the largest among all the industries, accounting for over
10 per cent of the country�s GDP and around 8 per cent of the employment. The
Retail Industry in India has come forth as one of the most dynamic and fast paced
industries with several players entering the market. But all of them have not yet
tasted success because of the heavy initial investments that are required to break
even with other companies and compete with them. The India Retail Industry is
gradually inching its way towards becoming the next boom industry.
The total concept and idea of shopping has undergone an attention drawing change
in terms of format and consumer buying behavior, ushering in a revolution in
shopping in India. Modern retailing has entered into the Retail market in India as is
observed in the form of bustling shopping centers, multi-storied malls and the huge
complexes that offer shopping, entertainment and food all under one roof.
A large young working population with median age of 24 years, nuclear families in
urban areas, along with increasing workingwomen population and emerging
opportunities in the services sector are going to be the key factors in the growth of
the organised Retail sector in India. The growth pattern in organised retailing and in
the consumption made by the Indian population will follow a rising graph helping the
newer businessmen to enter the India Retail Industry.
In India the vast middle class and its almost untapped retail industry are the key
attractive forces for global retail giants wanting to enter into newer markets, which in
turn will help the India Retail Industry to grow faster. Indian retail is expected to grow
25 per cent annually. Modern retail in India could be worth US$ 175-200 billion by
2016. The Food Retail Industry in India dominates the shopping basket. The Mobile
phone Retail Industry in India is already a US$ 16.7 billion business, growing at over
20 per cent per year. The future of the India Retail Industry looks promising with the
growing of the market, with the government policies becoming more favorable and
the emerging technologies facilitating operations.
7
Indian retail market
The Indian retail market, which is the fifth largest retail destination globally, was ranked
second after Vietnam as the most attractive emerging market for investment in the retail
sector by AT Kearney's seventh annual Global Retail Development Index (GRDI), in
2008. The share of retail trade in the country's gross domestic product (GDP) was
between 8–10 per cent in 2007. It is currently around 12 per cent, and is likely to reach
22 per cent by 2010.
Commercial real estate services company, CB Richard Ellis' findings state that India's
retail market is currently valued at US$ 511 billion, and is poised to grow to US$ 833
billion by 2013. The report further stated that organised retail that currently accounts for
less than 5 per cent of the total retail market is expected to register a compound annual
growth rate (CAGR) of 40 per cent and swell to US$ 107 billion by 2013.
A report by global consultancy firm, AT Kearney said "The consumer spending in India
has increased by an impressive 75 per cent in the last four years and will quadruple in
the next 20 years." Moreover, India recently topped the Nielsen Global Consumer
Confidence study, conducted by Nielsen, a market research company. The biannual
report revealed that Indians are "the most optimistic lot globally who think that their
country will be out of the economic recession in the next twelve months."
According to the recent report by McKinsey & Company titled 'The Great Indian Bazaar,
Organized Retail Comes of Age in India', India's overall retail sector is likely to grow to
US$ 450 billion by 2015. Another McKinsey report 'The rise of Indian Consumer Market',
estimates that the Indian consumer market is likely to grow four times by 2025.
In a joint study recently conducted by ASSOCHAM and KPMG, the following findings were
revealed:
The total retail market size in India in 2008 was estimated at US$ 353 billion.
8
The Indian retail market, which is the fifth largest retail destination globally, was ranked
second after Vietnam as the most attractive emerging market for investment in the retail
sector by AT Kearney's seventh annual Global Retail Development Index (GRDI), in
2008. The share of retail trade in the country's gross domestic product (GDP) was
between 8–10 per cent in 2007. It is currently around 12 per cent, and is likely to reach
22 per cent by 2010.
Commercial real estate services company, CB Richard Ellis' findings state that India's
retail market is currently valued at US$ 511 billion, and is poised to grow to US$ 833
billion by 2013. The report further stated that organised retail that currently accounts for
less than 5 per cent of the total retail market is expected to register a compound annual
growth rate (CAGR) of 40 per cent and swell to US$ 107 billion by 2013.
A report by global consultancy firm, AT Kearney said "The consumer spending in India
has increased by an impressive 75 per cent in the last four years and will quadruple in
the next 20 years." Moreover, India recently topped the Nielsen Global Consumer
Confidence study, conducted by Nielsen, a market research company. The biannual
report revealed that Indians are "the most optimistic lot globally who think that their
country will be out of the economic recession in the next twelve months."
According to the recent report by McKinsey & Company titled 'The Great Indian Bazaar,
Organized Retail Comes of Age in India', India's overall retail sector is likely to grow to
US$ 450 billion by 2015. Another McKinsey report 'The rise of Indian Consumer Market',
estimates that the Indian consumer market is likely to grow four times by 2025.
In a joint study recently conducted by ASSOCHAM and KPMG, the following findings
were revealed:

The total retail market size in India in 2008 was estimated at US$ 353 billion.

The annual growth of the retail market in India is expected to be around 8 per
cent.

The total retail market size in India is likely to touch US$ 416 billion by 2010.

The present share of organised retail sector is estimated at 7 per cent.

The estimated annual growth of organised retail sector is 40 per cent.

The size of organised retail sector by 2010 is estimated to reach US$ 51 billion.

The estimated share of organised retail in total retail by 2010 is 12 per cent.
9

The investment into modern retailing formats over the coming 4-5 years is
expected to be around US$ 25-30 billion.
The great Indian consumer market is still going strong. The ETIG analysis carried out by
the Economic Times revealed that most mass consumer satisfied and service in India
were not much affected by the global economic slowdown. Despite the inflation
experienced during the period, the second-quarter results of leading 70 consumerrelated firms revealed that their aggregate revenues increased by 8.5 per cent during
the September 2008 quarter over the same period in 2007. Even though this was a tad
lower than the 9 per cent growth posted during the first quarter of 2008-09, it was a lot
higher than the 7 per cent registered during the previous three quarters for these firms.
The Indian retail market, which is the fifth largest retail destination globally, was ranked
second after Vietnam as the most attractive emerging market for investment in the retail
sector by AT Kearney's seventh annual Global Retail Development Index (GRDI), in
2008. The share of retail trade in the country's gross domestic product (GDP) was
between 8–10 per cent in 2007. It is currently around 12 per cent, and is likely to reach
22 per cent by 2010.
Commercial real estate services company, CB Richard Ellis' findings state that India's
retail market is currently valued at US$ 511 billion, and is poised to grow to US$ 833
billion by 2013. The report further stated that organised retail that currently accounts for
less than 5 per cent of the total retail market is expected to register a compound annual
growth rate (CAGR) of 40 per cent and swell to US$ 107 billion by 2013.
A report by global consultancy firm, AT Kearney said "The consumer spending in India
has increased by an impressive 75 per cent in the last four years and will quadruple in
the next 20 years." Moreover, India recently topped the Nielsen Global Consumer
Confidence study, conducted by Nielsen, a market research company. The biannual
report revealed that Indians are "the most optimistic lot globally who think that their
country will be out of the economic recession in the next twelve months."
According to the recent report by McKinsey & Company titled 'The Great Indian Bazaar,
Organized Retail Comes of Age in India', India's overall retail sector is likely to grow to
10
US$ 450 billion by 2015. Another McKinsey report 'The rise of Indian Consumer Market',
estimates that the Indian consumer market is likely to grow four times by 2025.
In a joint study recently conducted by ASSOCHAM and KPMG, the following findings
were revealed:

The total retail market size in India in 2008 was estimated at US$ 353 billion.

The annual growth of the retail market in India is expected to be around 8 per
cent.

The total retail market size in India is likely to touch US$ 416 billion by 2010.

The present share of organised retail sector is estimated at 7 per cent.

The estimated annual growth of organised retail sector is 40 per cent.

The size of organised retail sector by 2010 is estimated to reach US$ 51 billion.

The estimated share of organised retail in total retail by 2010 is 12 per cent.

The investment into modern retailing formats over the coming 4-5 years is
expected to be around US$ 25-30 billion.
The great Indian consumer market is still going strong. The ETIG analysis carried out by
the Economic Times revealed that most mass consumer goods and service in India
were not much affected by the global economic slowdown. Despite the inflation
experienced during the period, the second-quarter results of leading 70 consumerrelated firms revealed that their aggregate revenues increased by 8.5 per cent during
the September 2008 quarter over the same period in 2007. Even though this was a tad
lower than the 9 per cent growth posted during the first quarter of 2008-09, it was a lot
higher than the 7 per cent registered during the previous three quarters for these firms.
Growth Continues Apace
Despite the global economic slowdown, Indian retailers are still optimistic about the
India growth story. Speaking on the issue, Mr Tarun Joshi, CEO and MD of Brandhouse
Retails said
The Indian retail market, which is the fifth largest retail destination globally, was ranked
second after Vietnam as the most attractive emerging market for investment in the retail
11
sector by AT Kearney's seventh annual Global Retail Development Index (GRDI), in
2008. The share of retail trade in the country's gross domestic product (GDP) was
between 8–10 per cent in 2007. It is currently around 12 per cent, and is likely to reach
22 per cent by 2010.
Commercial real estate services company, CB Richard Ellis' findings state that India's
retail market is currently valued at US$ 511 billion, and is poised to grow to US$ 833
billion by 2013. The report further stated that organised retail that currently accounts for
less than 5 per cent of the total retail market is expected to register a compound annual
growth rate (CAGR) of 40 per cent and swell to US$ 107 billion by 2013.
A report by global consultancy firm, AT Kearney said "The consumer spending in India
has increased by an impressive 75 per cent in the last four years and will quadruple in
the next 20 years." Moreover, India recently topped the Nielsen Global Consumer
Confidence study, conducted by Nielsen, a market research company. The biannual
report revealed that Indians are "the most optimistic lot globally who think that their
country will be out of the economic recession in the next twelve months."
According to the recent report by McKinsey & Company titled 'The Great Indian Bazaar,
Organized Retail Comes of Age in India', India's overall retail sector is likely to grow to
US$ 450 billion by 2015. Another McKinsey report 'The rise of Indian Consumer Market',
estimates that the Indian consumer market is likely to grow four times by 2025.
In a joint study recently conducted by ASSOCHAM and KPMG, the following findings
were revealed:

The total retail market size in India in 2008 was estimated at US$ 353 billion.

The annual growth of the retail market in India is expected to be around 8 per
cent.

The total retail market size in India is likely to touch US$ 416 billion by 2010.

The present share of organised retail sector is estimated at 7 per cent.

The estimated annual growth of organised retail sector is 40 per cent.

The size of organised retail sector by 2010 is estimated to reach US$ 51 billion.

The estimated share of organised retail in total retail by 2010 is 12 per cent.

The investment into modern retailing formats over the coming 4-5 years is
expected to be around US$ 25-30 billion.
12
The great Indian consumer market is still going strong. The ETIG analysis carried out by
the Economic Times revealed that most mass consumer goods and service in India
were not much affected by the global economic slowdown. Despite the inflation
experienced during the period, the second-quarter results of leading 70 consumerrelated firms revealed that their aggregate revenues increased by 8.5 per cent during
the September 2008 quarter over the same period in 2007. Even though this was a tad
lower than the 9 per cent growth posted during the first quarter of 2008-09, it was a lot
higher than the 7 per cent registered during the previous three quarters for these firms.
Growth Continues Apace
Despite the global economic slowdown, Indian retailers are still optimistic about the
India growth story. Speaking on the issue, Mr Tarun Joshi, CEO and MD of Brandhouse
Retails said “Fashion retail has not been impacted in a big way. Not even 0.5 per cent of
the working population has been hit in India.” “The Indian economy is more stable than
other economies across the world and one must not confuse India with the rest of the
world”, reiterated Mr Sandeep Kulhalli, V-P, Retail and Marketing, Tanishq.
With the 30-40 per cent drop in retail rentals, Indian retailers are a happy lot. In fact,
retailers are also foreseeing further drops in rentals in 2009 and they are optimistic
about their expansion plans for this year.
Retailers such as Spencer's Retail, Future Group, Shoppers Stop, Westside, Wills
Lifestyle, Bata India, and Raymond, have plenty of expansion plans for 2009.

The Future Group will focus on launching private labels with high profit margins in
segments like toothpaste, shampoo, and butter amongst others. According to
Kishore Biyani, MD and CEO of the Future Group, "Another thrust area will be
entering into new segments like rural retail and telecom products distribution.
Through 'Aadhar' we can ramp up rural retail, which is outside the 20 per cent of
the population we have been targeting so far."

Aggressive marketing efforts by leading retailers are on. Tanishq is planning a
marketing effort for plain gold along with the World Gold Council during the last
quarter of 2008-09. Similarly, Brandhouse Retails is planning a joint venture with
13
a European private apparel label for the next financial year, along with the
introduction of a few more international brands.

In West Bengal, leading retailers like the Future Group and Spencer's Retail, are
expanding and upgrading their present stores in 2009. Others like Wills Lifestyle,
Turtle Ltd, and Bisk Farm, are planning to set up new stores, particularly in the
suburbs.

Auto company Mahindra & Mahindra (M&M) has made a quiet foray into the retail
sector with the soft launch of its specialty format Mom & Me to sell infant care
and maternity products. The company has launched two outlets in Ludhiana and
Ahmedabad.
India has one of the largest number of retail outlets in the world. A report by Images
Retail estimates the number of operational malls to grow more than two-fold, to cross
412, with 205 million square feet by 2010, and a further 715 malls to be added by 2015,
with major retail developments even in tier-II and tier-III cities in India.
Even as the organised retail market is starting to take off, there is an associated surge in
branded discount outlets in India. Top realtors and local retail chains are developing
malls in regional boroughs, specifically to sell premium branded goods.
THE INDIAN RETAIL SCENE
India is the country having the most unorganised retail market. Traditionally it is a
family�s livelihood, with their shop in the front and house at the back, while they
run the retail business. More than 99% retailer�s function in less than 500 square
feet of shopping space. Global retail consultants KSA Technopak have estimated
that organised retailing in India is expected to touch Rs 35,000 crore in the year
2005-06. The Indian retail sector is estimated at around Rs 900,000 crore, of which
the organised sector accounts for a mere 2 per cent indicating a huge potential
market opportunity that is lying in the waiting for the consumer-savvy organised
retailer.
14
Purchasing power of Indian urban consumer is growing and branded merchandise in
categories like Apparels, Cosmetics, Shoes, Watches, Beverages, Food and even
Jewellery, are slowly becoming lifestyle products that are widely accepted by the
urban Indian consumer. Indian retailers need to advantage of this growth and aiming
to grow, diversify and introduce new formats have to pay more attention to the brand
building process. The emphasis here is on retail as a brand rather than retailers
selling brands. The focus should be on branding the retail business itself. In their
preparation to face fierce competitive pressure, Indian retailers must come to
recognize the value of building their own stores as brands to reinforce their
marketing positioning, to communicate quality as well as value for money.
Sustainable competitive advantage will be dependent on translating core values
combining products, image and reputation into a coherent retail brand strategy.
There is no doubt that the Indian retail scene is booming. A number of large
corporate houses � Tata�s, Raheja�s, Piramals�s, Goenka�s �
have already made their foray into this arena, with beauty and health stores,
supermarkets, self-service music stores, newage book stores, every-day-low-price
stores, computers and peripherals stores, office equipment stores and home/building
construction stores. Today the organised players have attacked every retail
category. The Indian retail scene has witnessed too many players in too short a time,
crowding several categories without looking at their core competencies, or having a
well thought out branding strategy.
STRATEGIES, TRENDS AND OPPORTUNITIES 2007
Retailing in India is gradually inching its way toward becoming the next boom
industry. The whole concept of shopping has altered in terms of format and
consumer buying behavior, ushering in a revolution in shopping in India. Modern
retail has entered India as seen in sprawling shopping centres, multi-storied malls
and huge complexes offer shopping, entertainment and food all under one roof. The
Indian retailing sector is at an inflexion point where the growth of organised retailing
and growth in the consumption by the Indian population is going to take a higher
growth trajectory. The Indian population is witnessing a significant change in its
demographics. A large young working population with median age of 24 years,
15
nuclear families in urban areas, along with increasing workingwomen population and
emerging opportunities in the services sector are going to be the key growth drivers
of the organised retail sector in India.
India: Retail sector will grow by 15% in 2008-09
The economic slowdown has taken its toll on the growth of organised retailing in India.
The organised retail sector will grow by some
15% in 2008-09 as compared to the 30% growth it has been witnessing, according to
latest projections by the apex industry body Retailers Association of India (RAI).
"The growth in India’s organised retailing will be hit due to weak consumer sentiments
and the slowdown in fresh investment. Retailers are quite cautious in opening new stores
since property prices are falling and are waiting for more viable deals," RAI chief
executive officer Kumar Rajagopalan told ET.
The association also estimates modern retail will halve its recruitment in 2009-10. "Fresh
employment in retail is directly proportional to growth. The sector creates a lot of indirect
employment which will take a hit too. For instance, every two jobs created directly fuels
one job for support functions like in a supply chain," said Mr Rajagopalan.
Typically, a department store recruits one person for every 200 sq ft, speciality retailers
employ four people per 100 sq ft and a hypermarket will have one person per 300 sq ft.
RAI represents the interests of organised retailers in India and has nearly 405 companies
on board. This includes Future Group, Trent, Reliance Retail, Aditya Birla Retail, Globus,
Shopper’s Stop and Spencer’s. Organised retailing constitutes around 5% of the
country’s total retail sector valued at approximately Rs 13 lakh crore.
However, a section of the industry feels the country’s organised retailing will not be as hit
16
as RAI estimates. While sales have slowed down after Diwali, there have been
occasional spurts as during Christmas and the extended period of discounts. "Our
estimates suggest modern retailing will grow by around 25% this fiscal," said leading
retail consultancy Technopak Advisors chairman Arvind K. Singhal.
Mr Rajagopalan said retail sector growth is directly proportional to that of GDP. "The
government needs to take measures to boost retail sector growth. It should initiate efforts
to bring back consumer confidence, waive service tax on retail space rentals and provide
some flexibility on labour laws for the sector," he said.
Source: economictimes.indiatimes.com
17
GROWTH OF RETAIL SECTOR IN INDIA
Retail and real estate are the two booming sectors of India in the present times. And
if industry experts are to be believed, the prospects of both the sectors are mutually
dependent on each other. Retail, one of India�s largest industries, has presently
emerged as one of the most dynamic and fast paced industries of our times with
several players entering the market. Accounting for over 10 per cent of the
country�s GDP and around eight per cent of the employment retailing in India is
gradually inching its way toward becoming the next boom industry.
As the contemporary retail sector in India is reflected in sprawling shopping centers,
multiplex- malls and huge complexes offer shopping, entertainment and food all
under one roof, the concept of shopping has altered in terms of format and
consumer buying behavior, ushering in a revolution in shopping in India. This has
also contributed to large-scale investments in the real estate sector with major
national and global players investing in developing the infrastructure and
construction of the retailing business. The trends that are driving the growth of the
retail sector in India are

Low share of organised retailing

Falling real estate prices

Increase in disposable income and customer aspiration

Increase in expenditure for luxury items (CHART)
As the contemporary retail sector in India is reflected in sprawling shopping centers,
multiplex- malls and huge complexes offer shopping, entertainment and food all
under one roof, the concept of shopping has altered in terms of format and
consumer buying behavior, ushering in a revolution in shopping in India. This has
also contributed to large-scale investments in the real estate sector with major
national and global players investing in developing the infrastructure and
18
construction of the retailing business. The trends that are driving the growth of the
retail sector in India are

Low share of organised retailing

Falling real estate prices

Increase in disposable income and customer aspiration

Increase in expenditure for luxury items (CHART)
RETAILING FORMAT IN INDIA
Malls:
The largest form of organised retailing today. Located mainly in metro cities, in
proximity to urban outskirts. Ranges from 60,000 sq ft to 7,00,000 sq ft and above.
They lend an ideal shopping experience with an amalgamation of product, service
and entertainment, all under a common roof. Examples include Shoppers Stop,
Piramyd, and Pantaloon.
Specialty Stores:
Chains such as the Bangalore based Kids Kemp, the Mumbai books retailer
Crossword, RPG's Music World and the Times Group's music chain Planet M, are
focusing on specific market segments and have established themselves strongly in
their sectors.
19
Discount Stores:
As the name suggests, discount stores or factory outlets, offer discounts on the MRP
through selling in bulk reaching economies of scale or excess stock left over at the
season. The product category can range from a variety of perishable/ non-perishable
goods.
Department Stores:
Large stores ranging from 20000-50000 sq. ft, catering to a variety of consumer
needs. Further classified into localized departments such as clothing, toys, home,
groceries, etc.
Departmental Stores are expected to take over the apparel business from exclusive
brand showrooms. Among these, the biggest success is K Raheja's Shoppers Stop,
which started in Mumbai and now has more than seven large stores (over 30,000 sq.
ft) across India and even has its own in store brand for clothes called Stop.
Hyper marts/Supermarkets:
Large self-service outlets, catering to varied shopper needs are termed as
Supermarkets. These are located in or near residential high streets. These stores
today contribute to 30% of all food & grocery organised retail sales. Super Markets
can further be classified in to mini supermarkets typically 1,000 sq ft to 2,000 sq ft and
large supermarkets ranging from of 3,500 sq ft to 5,000 sq ft. having a strong focus on
food & grocery and personal sales.
20
Convenience Stores:
These are relatively small stores 400-2,000 sq. feet located near residential areas.
They stock a limited range of high-turnover convenience products and are usually
open for extended periods during the day, seven days a week. Prices are slightly
higher due to the convenience premium
 MBO’s :
Multi Brand outlets, also known as Category Killers, offer several brands
across a single product
category. These usually do well in busy market places and Metros.
RECENT TRENDS

Retailing in India is witnessing a huge revamping exercise as can be seen in the
graph

India is rated the fifth most attractive emerging retail market: a potential goldmine.

Estimated to be US$ 200 billion, of which organised retailing (i.e. modern trade)
makes up 3 percent or US$ 6.4 billion

As per a report by KPMG the annual growth of department stores is estimated at
24%

Ranked second in a Global Retail Development Index of 30 developing countries
drawn up by AT Kearney.

Multiple drivers leading to a consumption boom:
o
Favorable demographics
o
Growth in income
21
o
Increasing population of women
o
Raising aspirations: Value added goods sales

Food and apparel retailing key drivers of growth

Organized retailing in India has been largely an urban

Phenomenon with affluent classes and growing number of double-income
households.

More successful in cities in the south and west of India. Reasons range from
differences in consumer buying behavior to cost of real estate and taxation laws.

Rural markets emerging as a huge opportunity for retailers reflected in the share
of the rural market across most categories of consumption
ITC is experimenting with retailing through its e-Choupal and Choupal
o
Sagar � rural hypermarkets.
o
HLL is using its Project Shakti initiative � leveraging women self-help
groups � to explore the rural market.
o
Mahamaza is leveraging technology and network marketing concepts to
act as an aggregator and serve the rural markets.

IT is a tool that has been used by retailers ranging from Amazon.com to eBay to
radically change buying behavior across the globe.

�E-tailing� slowly making its presence felt
CHALLENGES & OPPORTUNITIES
Retailing has seen such a transformation over the past decade that its very definition
has undergone a sea change. No longer can a manufacturer rely on sales to take
place by ensuring mere availability of his product. Today, retailing is about so much
more than mere merchandising. It�s about casting customers in a story, reflecting
their desires and aspirations, and forging long-lasting relationships. As the Indian
consumer evolves they expects more and more at each and every time when they
steps into a store. Retail today has changed from selling a product or a service to
selling a hope, an aspiration and above all an experience that a consumer would like
22
to repeat.
For manufacturers and service providers the emerging opportunities in urban
markets seem to lie in capturing and delivering better value to the customers through
retail. For instance, in Chennai CavinKare�s LimeLite, Marico�s Kaya Skin
Clinic and Apollo Hospital�s Apollo Pharmacies are examples, to name a few,
where manufacturers/service providers combine their own manufactured products
and services with those of others to generate value hitherto unknown. The last mile
connect seems to be increasingly lively and experiential. Also, manufacturers and
service providers face an exploding rural market yet only marginally tapped due to
difficulties in rural retailing. Only innovative concepts and models may survive the
test of time and investments.
However, manufacturers and service providers will also increasingly face a host of
specialist retailers, who are characterized by use of modern management
techniques, backed with seemingly unlimited financial resources. Organized retail
appears inevitable.
Retailing in India is currently estimated to be a US$ 200 billion industry, of which
organised retailing makes up a paltry 3 percent or US$ 6.4 billion. By 2010,
organised retail is projected to reach US$ 23 billion. For retail industry in India,
things have never looked better and brighter. Challenges to the manufacturers and
service providers would abound when market power shifts to organised retail.
23
CONCLUSION
The retail sector has played a phenomenal role throughout the world in increasing
productivity of consumer goods and services. It is also the second largest industry in
US in terms of numbers of employees and establishments. There is no denying the
fact that most of the developed economies are very much relying on their retail
sector as a locomotive of growth. The India Retail Industry is the largest among all
the industries, accounting for over 10 per cent of the country�s GDP and around 8
per cent of the employment. The Retail Industry in India has come forth as one of the
most dynamic and fast paced industries with several players entering the market.
But all of them have not yet tasted success because of the heavy initial investments
that are required to break even with other companies and compete with them. The
India Retail Industry is gradually inching its way towards becoming the next boom
industry.
24
Types of retail
Rural Retail
Led by the rising purchasing power, changing consumption patterns, increased access
to information and communication technology and improving infrastructure, the rural
retail market is estimated to cross US$ 45.32 billion mark by 2010 and US$ 60.43 billion
by 2015, according to a study by Confederation of Indian Industry (CII) and YES Bank.
As per the National Council of Applied Economic Research (NCAER) reports, there are
720 million consumers across 6, 27,000 villages in rural India.
According to a report—India Retail Report 2009— by Images FR Research, "India's
rural markets offer a sea of opportunity for the retail sector. The urban-retail split in
consumer spending stands at 9:11, with rural India accounting for 55 per cent of private
retail consumption." Rural India accounted for almost half of the Indian retail market,
which was worth about US$ 273.64 billion in September 2008. With most of the retail
markets getting saturated in tier-I and tier-II cities, the next phase of growth is likely to
be seen in the rural markets.
Major domestic retailers like AV Birla, ITC, Godrej, Reliance and many others have
already set up farm linkages. Hariyali Kisan Bazaars (DCM) and Aadhars (PantaloonGodrej JV), Choupal Sagars (ITC), Kisan Sansars (Tata), Reliance Fresh, and Naya
Yug Bazaar, are established rural retail hubs. Retail giants like Reliance, Spencer's and
Subhiksha are also expanding in semi-urban and rural areas.
Luxury Retail
By the next four to five years, India is expected to become a manufacturing hub for
global luxury brands, according to a FICCI-Yes Bank report on luxury brands. The report
states that India has the most rapidly growing high-net worth individuals (HNI)
population in the world, and the income level of consumers is expected to grow three
times by 2025. The active age group (25–45 years) is likely to rise to a third of the
population.
25
The report further states that the manufacturing business of luxury items in India can
cross US$ 500 million with global brands like Louis Vuitton and Frette looking at India as
a manufacturing base.
According to a survey done by AT Kearney, the Indian luxury retail market is estimated
to touch US$ 30 billion by 2015. Estimated to be the 12th largest in the world, it has
been growing at the rate of 25 per cent per annum.
E-tailing
The increase in personal computers (PC) and internet penetration along with the
growing preference of Indian consumers to shop online has given a tremendous boost
to e-tailing, the online version of retail shopping. An estimated 10 per cent of the total ecommerce market is accounted for by e-tailing. Several online retailers are reporting
good business in categories like travel, art, books and music. E-tailing in lingerie and
fresh fruit businesses is also doing well.
Retail Franchising
Along with e-tailing, another perceptible trend in the growth of organised retail market
has been the concept of retail franchising. According to industry estimates, retail
franchising has been growing at the rate of 60 per cent in the last three years and is set
to grow two-fold in the next five years. And with immense potential seen in this segment,
the US$ 4 billion-franchising industry is likely to see an almost two-fold rise in the
number of franchisees (from 0.2 million) by 2010.
Innovative Retail Concepts
With the entry of new players and the market becoming increasingly competitive, retail
players are using innovative retail concepts to attract consumers.
26
With reduced commodity prices and the recent excise duty cuts, input costs have come
down by around 25-30 per cent in several categories. Subsequently, many value
retailers have brought down prices by over 15 per cent for various product categories to
encourage greater consumption. They are also stepping up their bargains and discount
offers. Retailers like Big Bazaar, D'Mart, Spencer's and Food Bazaar, among other
retailers, have begun slashing prices in product categories like apparel, home products,
and foods (private labels). In fact, modern retailers are now also selling private labels
with consumers looking out for cheaper brands.
Retail companies are also developing and promoting their in-house brands. The Future
Group will be targeting profits worth US$ 2.05 billion from its in-house brands in FMCG,
household consumer durable and electronics and apparel categories by 2012. After the
good performance of its in-house consumer brands such as Tasty Treat, Fresh & Pure,
DJ&C, Koreo, the company now wants to extend it to additional categories like health &
beauty, dairy, apparel, and accessories.
Furthermore, Big Bazaar, the hypermarket chain of Future Group, is introducing
Customer Advisory Boards (CABs) as a measure for receiving valuable customer
feedback.
With the US$ 6.31 billion pharma retailing becoming progressively more organised,
players are now looking at newer formats to attract more people to their stores.
Pharmacy chains like MedPlus and Goodlife have started providing health check-ups,
diagnostic services, dental care and medical counselling to its patients, besides selling
pharma and wellness products.
Goodlife is tying up with the retail major, Future group, to set up these convenience
clinics at malls and in the high streets. MedPlus operates 15 such integrated clinics, and
is planning to open at least 50 such clinics by March 2009.
Innovative concepts in recreational retail are pulling people to malls, and big retail setups account for a small but rapidly growing part of a multi-million dollar industry. There
are a variety of concepts like made-to-order pottery-painting, portrait-making, creating
toons or casting gold and silver impressions that have proliferated in malls or exist as
standalone ventures. In fact, a whole new concept of customised, leisure retail has
opened up for the Indian consumer.
27
Investments on the Anvil
India's vast middle class with its expanding purchasing power and its rapidly growing
retail industry are key attractions for global retail giants wanting to enter newer markets.

Impact Retail Private Ltd is planning to invest US$ 41.16 million for launching 30
Xcite consumer electronics retail showrooms in Indian metros by December
2009.

Pyramis India (retailers of branded kitchen accessories), is planning to launch
215 exclusive showrooms with at an investment US$ 4.11 million, over the next
four months.

German lifestyle brand Puma is getting into a joint venture with Knowledge Fire to
sell Puma products ranging from apparel to shoes and accessories. Puma will
hold 51 per cent stake in the JV. The JV targets to open 40 retail stores in India in
2009 and take it up to 140 by 2015.

Indian ethnic wear chain, Fabindia has picked up a 25 per cent stake in the UKbased womens' wear retailer EAST. The amount was not disclosed and Fabindia
has the choice to buy out the remaining stake in the next three years.

Footwear retail company Pavers England Footprint, will be investing US$ 10
million to set up 1,000 stores across India by 2013. Presently, the company has
25 stores in India. The company is also looking at setting up an R&D facility in
Chennai for designing footwear, with an investment of US$ 3 million.

In partnership with the Future Group, Axiom Telecom (a mobile retail company
from West Asia) will be forming a joint venture company called Future Axiom
Telecom Ltd. The 50:50 JV plans an initial investment of around US$ 40 million,
and targets setting up 1,500-outlets by the end of December 2009.

Mumbai-based retail food and grocery player Wadhawan Food Retail (WFRL)
plans to invest US$ 308.90 million to set up 1,300 stores across India during
2008-2012. The retail chain currently has 200 stores, managed through four
branded formats - 'Spinach', 'Sabka Bazaar', 'The Home Store' and 'Smart Retail'.

Spencer's Retail will be establishing 300 additional stores by 2010 with an
investment of US$ 102.88 million. Presently, Spencer's has 700 stores, which
account for a retail space of 2.5 million, which will increase by another 1.3 million
sq ft by 2010.
28

Similarly, ITC's Wills Lifestyle and John Players plan to expand their presence in
tier II & III cities, increasing their retail space around 15-20 per cent. Currently,
there are over 50 Wills Lifestyle stores in India.

Shopper's Stop is also planning to invest US$ 205.78 million for increasing its
present store space of 1.3 million square feet to 2.7 million square feet over the
coming 3-4 years.

Leading footwear retailer Bata India is planning to establish 60 stores in 2009
across the country.

Leading garments retailer Raymonds is planning to establish 50 additional stores
in tier II & III cities across the country. According to Aniruddha Deshmukh,
President, Rretail and FMCG, Raymond, its retail stores have witnessed revenue
growth of 12 per cent in recent months, despite the ongoing economic slump.

Tata Group's Trent, (which operates Westside), is planning to add 8-10 stores
every year to its present 31 store in India.

The Future Group will be investing US$ 30.86 per sq ft and US$ 41.15 per sq ft
respectively for an additional 3.5 lakh sq ft for Big Bazaar and 50,000 sq ft for
Pantaloons stores over the next one year in eastern India.

Bisk Farm, the US$ 41.16 million biscuit brand promoted by Saj Industries, will be
launching a bakery retail chain called ‘Bisk Farm, Just Baked'. The company
plans to

open 100 franchise stores in different parts of the country soon.
Government Initiatives
The government has taken various measures to promote and encourage investment in
the Indian retail industry.
The Government allows 100 per cent FDI in cash and carry through the automatic route
and 51 per cent in single brands. Besides, the franchise route is available for big
operators. To further attract global retailers, the economic survey 2007–08 has
suggested a share for foreign equity in all retail trade and 100 per cent in respect of
luxury brands and other specialised retail chains.
29
However, many industry experts feel that the Indian tariff structure has to be streamlined
as India levies one of the highest duties and taxes on imported luxury goods. This fuels
the growth of the grey market and duty-free purchases, even as the stringent regulatory
environment encumbers investment by foreign brands.
Exchange rate used: 1 USD = 48.6024
30
INDUSTRY PROFILE
31
RETAIL INDUSTRY:
Retailing is one of the pillars of the economy in India and accounts for 35%
of GDP. The retail industry is divided into organised and unorganised sectors.
Over 12 million outlets operate in the country and only 4% of them being larger
than 500 sq ft (46 m²) in size. Organized retailing refers to trading activities
undertaken by licensed retailers, that is, those who are registered for sales tax,
income tax, etc. These include the corporate-backed hypermarkets and retail
chains, and also the privately owned large retail businesses. Unorganised
retailing, on the other hand, refers to the traditional formats of low-cost retailing,
for example, the local kirana shops, owner manned general stores, beedi shops,
convenience stores, hand cart and pavement vendors, etc.
INDUSTRY OVERVIEW:
Facts and other statistics in this section relating to India, the Indian
economy and Indian Retail Industry has been derived from various publications
and obtained in from agencies that we believe to be reliable. However, we cannot
guarantee the quality or reliability of such source of materials. While our directors
have taken reasonable care in the reproduction of the information, they have not
been prepared or independently verified by us, the Underwriters or any of our or
their respective affiliates or advisers and, therefore, we make no representation
as to the accuracy of such facts and statistics, which may not be consistent with
other information compiled within or outside India. Due to possibly flawed or
ineffective collection methods or discrepancies between published information
and market practice and other problems, the statistics herein may be inaccurate
or may not be comparable to statistics produced for other economies and should
not be unduly relied upon. Further, there is no assurance that they are stated or
compiled on the same basis or with the same degree of accuracy as may be the
case elsewhere. In all cases, investors should give consideration as to how much
weight or importance they should attach to or place on such facts or statistics.
32
Unless otherwise indicated, all financial and statistical data in the following
discussion is derived from CRIS INFAC – Retailing Industry – Annual Review –
September 2005 (hereinafter referred as CRIS INFAC).
INDIAN RETAIL INDUSTRY:
Organized retail in India is on a high growth trajectory and is growing at
the rate of 24-26% annually. The size of the total retail industry market is
estimated to be around Rs. 9,990 billion in 2004-05, with organised retailing
accounting for a mere 3.5% of the India’s total retail market. In its Annual Review,
CRIS INFAC estimated the organised retail penetration to increase to 8% by
2010 at a CAGR of 26%. The organised retail penetration is projected to increase
to 5.8% by 2007-08.
33
The Indian Retail Market:
Indian market has high complexities in terms of a wide geographic spread
and distinct consumer preferences varying by each region necessitating a need
for localization even within the geographic zones. India has highest number of
outlets per person (7 per thousand) Indian retail space per capita at 2 sq ft
(0.19 m²)/ person is lowest in the world Indian retail density of 6 percent is
highest in the world. (9) 1.8 million households in India have an annual income of
over 45 lakh (10) delving further into consumer buying habits, purchase decisions
can be separated into two categories: status-oriented and indulgence-oriented.
CTVs/LCDs, refrigerators, washing machines, dishwashers, microwave ovens
and DVD players fall in the status category. Indulgence-oriented products include
plasma TVs, state-of-the-art home theatre systems, iPods, high-end digital
34
cameras, camcorders, and gaming consoles. Consumers in the status category
buy because they need to maintain a position in their social group. Indulgenceoriented buying happens with those who want to enjoy life better with products
that meet their requirements. When it comes to the festival shopping season, it is
primarily the status-oriented segment that contributes largely to the retailer’s cash
register.
The break-up of organised retailing sales into various product categories
Books, Music & Gifts: 3% Mobile Handsets: 3% Clothing & Textile: 39% Food &
Grocery: 11% Consumer Durables: 9% Footwear: 9% Furniture & Furnishings:
8% Catering Services: 7% Jewellery & Watches: 7% Others: 4%.
Major Indian Retailers:
Indian apparel retailers are increasing their brand presence overseas,
particularly in developed markets. While most have identified a gap in countries in
West Asia and Africa, some majors are also looking at the US and Europe.
Arvind Brands, Madura Garments, Spykar Lifestyle and Royal Classic Polo are
busy chalking out foreign expansion plans through the distribution route and
standalone stores as well. Another denim wear brand, Spykar, which is now
moving towards becoming a casual wear lifestyle brand, has launched its store in
Melbourne recently. It plans to open three stores in London by 2008-end.
The low-intensity entry of the diversified Mahindra Group into retail is
unique because it plans to focus on lifestyle products. The Mahindra group is the
fourth large Indian business group to enter the business of retail after Reliance
Industries Ltd, the Aditya Birla Group, and Bharti Enterprises Ltd. The other three
groups are focusing either on perishables and groceries, or a range of products,
or both.
35
Major Indian Retailers:
RPG Retail
Music World, Books & Beyond, Spencer’s Hyper,
Spencer’s Super, Daily & Fresh .
Pantaloon Retail
Big Bazaar, Food Bazaar, Pantaloons, Central,
Fashion Station, Brand Factory, Depot, all, E-Zone etc.
Tata Group
Westside, Star India Bazaar, Steel junction, Landmark,
Titan Industries with World of Titans showrooms,
Tanishq outlets, Chroma.
K Raheja Corp.
Shoppers’ Stop, Crossword, Hyper City, Inorbit
Group
Lifestyle International-Lifestyle, Home Centre, Max,
Fun City and International Franchise brand stores.
Pyramid Retail
Pyramid Megastore, TruMart
Nilgiri’s
Nilgiris’ supermarket chain
Subhiksha
Subhiksha supermarket pharmacy and telecom
discount chain.
Trinethra
Fabmall supermarket chain and Fabcity hypermarket
chain
Vishal Retail Group
Vishal Mega Mart
BPCL
In & Out
Reliance Retail
Reliance Fresh
Reliance ADAG
Reliance World, German Metro Cash & Carry
Retail
Shoprite Holdings
Shoprite Hyper.
Retail evolution:
Retailing in India has witnessed tremendous growth in the last few years.
Textile manufacturers like Bombay Dyeing, Raymond, S Kumar's and Grasim
were the first to set up retail chains. Thereafter, Titan successfully implemented
the organised retailing concept in India by establishing a series of well-designed
stores. Organized retailing first started picking up in South India, primarily due to
the availability of land at prime locations and cheaper real estate prices. The
36
early '90s saw the establishment of shops by Madura Garments and Zodiac,
which focused on 'one brand'. By the latter half of the decade, players in various
segments were making their presence felt on the retail scene: Food world,
Subhiksha and Nilgiris in food and FMCG; Planet M and Music World in music;
Crossword and Fountainhead in books.
Since then organised retailing in India has witnessed a radical
transformation. Shoppers' Stop was the pioneer in department stores and the
concept of malls evolved with Spencers in Chennai, Ansals in Delhi and
Crossroads in Mumbai. Initially, the players making forays into the mall scene
were those that had a construction background like the Rahejas and the
Piramals. Gradually, competition increased with more retail chains entering the
business and setting up stores. In spite of steep growth, the turnover of the top
five retailers in India (Pantaloon Retail, Shoppers' Stop, RPG, Trent and Lifestyle)
was less than Rs 30 billion, which was about 8 per cent of the total organised
retail market in 2004-05. In a bid to garner larger market shares, nearly all major
players have announced huge expansion plans.
At present, most players have announced ambitious expansion plans. In
order to differentiate and grow, players have adopted different strategies. Some
have chosen to operate in multiple formats, some are expanding to smaller cities
and others are focusing on supply chain management and operations. The
strategies adopted by these players will not only determine turnover growth but
also their profitability.
Growth:
An increasing number of people in India are turning to the services sector
for employment due to the relative low compensation offered by the traditional
agriculture and manufacturing sectors. The organised retail market is growing at
35 percent annually while growth of unorganised retail sector is pegged at 6
percent.
37
The Retail Business in India is currently at the point of inflection. Rapid
change with investments to the tune of US $ 25 billion is being planned by
several Indian and multinational companies in the next 5 years. It is a huge
industry in terms of size and according to management consulting firm
Technopak Advisors Pvt. Ltd., it is valued at about US $ 350 billion. Organized
retail is expected to garner about 16-18 percent of the total retail market (US $
65-75 billion) in the next 5 years.
India has topped the AT Kearney’s annual Global Retail Development
Index (GRDI) for the third consecutive year, maintaining its position as the most
attractive market for retail investment. The Indian economy has registered a
growth of 8% for 2007. The prediction for 2008 is 7.9%. The enormous growth of
the retail industry has created a huge demand for real estate. Property
developers are creating retail real estate at an aggressive pace and by 2010, 300
malls are estimated to be operational in the country.
With over 1,000 hypermarkets and 3,000 supermarkets projected to come
up by 2011, India will need additional retail space of 700,000,000 sq ft
(65,000,000 m²) as compared to today. Current projections on construction point
to a supply of just 200,000,000 sq ft (19,000,000 m²), leaving a gap of
500,000,000 sq ft (46,000,000 m²) that needs to be filled, at a cost of US$15-18
billion.
38
DRIVERS FOR GROWTH IN RETAILING:
Higher Disposable Income:
The disposable income of Indian consumers has increased steadily. The
proportion of the major consuming class (population that has an annual income
that is higher than Rs. 90,000) is expected to grow at a CAGR of 9.3 per cent
(2002-2010) over the next 8 years and will result in higher spending capacity and
eventually into greater consumption
Higher level of working women:
According to the 2001 census report, the population of working
women has increased from 22 per cent in 1991 to 26 per cent in 2001. The
purchasing habit of a working woman is different from that of a housewife, since
the former has lesser time to devote to the task. Working women would prefer a
one stop shop for purchasing their regular products. Also, a working woman's
propensity for spending is higher than that of a housewife
Increase in nuclear families
In the recent past, nuclear families as a percentage of the total household
population have increased. Average household sizes have decreased from 5.57
in 1991 to 5.36 in 2001. Per capita consumption increases in the case of a
nuclear family. The rise in the number of nuclear families will, thus, drive
consumption and boost the retail industry.
39
Baby boomer effect
There has been a strong demographic shift in India's population
distribution. The percentage of the earning population (15 to 60 yrs) in the total
population is rising. This will increase the overall purchasing capacity in the
country, propelling growth in the retail segment.
Higher growth in urban population:
At present, organised retailing is focused in metros and is expected to
expand to Tier-2 cities. For the next 10 years, growth in organised retailing is
expected to take place in urban areas. Thus, the target market for organised
retail players is the urban population. Urbanisation has increased at a rate of 2.7
per cent over the last 10 years (1990-2000) and is expected to increase at 2.4
per cent from 2000 to 2015. In 2015, the population in urban areas is expected to
touch 401 million, accounting for about 32.2 per cent of the total population
40
Higher income levels in urban population:
Greater growth in the numbers of the urban middle class and strong
growth in income levels augurs well for the growth of organised retailing, as we
believe that in the medium term organised retailing will be restricted to the urban
areas of India.
The proportion in total population of the segment with an annual income
higher than Rs 90,000 (that is, the major consuming class) has increased from
20.4 per cent in 1995-96 to 28.1 per cent in 2001-02. However, the share of the
major consuming class in the urban region has increased at a higher rate, from
45 per cent in 1998-99 to 51 per cent in 2001-02, and it is expected to touch 63
per cent by 2009-10. Further, the income levels of the urban middle class are
also expected to register a strong growth in the medium term.
41
Change in outlook on branded products and Growth in the number of retail malls:
In the last 4-5 years, Indian markets have witnessed a strong shift towards
branded products as Indian consumers have started feeling that branded goods
offer better quality and greater value for money. This increase in the awareness
of branded goods has been the highest in the case of apparel. Increased
exposure to international consumerism trends and fast-changing lifestyles can
result in a 10-15 per cent growth in branded goods, which will, in turn, provide a
platform for the growth of organised retail.
The last 2-3 years have also witnessed a proliferation in malls in India,
particularly in the metros and mini metros. The growth in retail malls provides
more options for retailers, as it reduces the time required to set up a retail outlet.
It also provides retail space, which can be leased by retailers instead of investing
in building up their own store. This significantly reduces the capital intensity of the
42
retail industry. Typically, a retail chain would prefer to lease store space in a mall
instead of setting up a standalone store, since this reduces capital investment,
which can be employed in their core business of retailing.
Increased use of credit cards and availability of cheap finance:
The use of plastic money (credit and debit cards) has increased
significantly in the last 3-4 years. The number of credit cards issued has grown at
a CAGR of 26 per cent in the last 5 years to touch 15.5 million by March 2005,
while debit cards have grown by a whopping 113 per cent to touch 29.8 million by
March 2005. In fact the ease of payments (ability to spend without cash) due to
the use of credit and debit cards, has also led to an increase in total spending on
shopping and eating out.
With the acceptance of and the increase in the number of electronic data
converter machines installed in retailing outlets, we believe credit and debit cards
will provide further fillip to organised retail
Expansion plans of existing players:
The top players in the market are adding floor space. The growth would
come from both same store sales growth and new stores. Players are getting into
new segments as well as geographies. Players who earlier concentrated on the
lifestyle segment are seen moving into value-based retailing with food and
grocery stores and hypermarkets to tap the opportunity. In fact, the top 3
players are expected to triple their floor space in the next 3 years. Players are
also getting into new segments, formats and geographies. Pantaloon plans to
take its retail space to 8 million square feet in 3 years and RPG has planned to
increase its retail space in the next 5 years to 4.5 million square feet.
43
India vs. World
 Indian retail is fragmented with over 12 million outlets operating in the
country. This is in comparison to 0.9 million outlets in USA, catering to more
than 13 times of the total retail market size as compared to India
 India has the highest number of outlets per capita in the world - widely
spread retail network but with the lowest per capita retail space (@ 2 sq. ft.
per person)
 Annual turnover of Wal-Mart (Sales in 2001 were $219 billion) is higher
than the size of Indian retail industry. Almost 100 times more than the
turnover of HLL (India's largest FMCG company).
 Wal-Mart - over 4,800 stores (over 47 million square meters) where as
none of India's large format store (Shoppers' Stop, Westside, Lifestyle) can
compare.
 The sales per hour of $22 million are incomparable to any retailer in the
world. Number of employees in Wal-Mart are about 1.3 million where as the
entire Indian retail industry employs about three million people.
 One-day sales record at Wal-Mart (11/23/01) $1.25 billion - roughly two
third of HLL's annual turnover.
 Developed economies like the U.S. employ between 10 and 11 percent of
their workforce in retailing (against 7 percent employed in India today).
 60% of retailers in India feel that the multiple format approach will be
successful here whereas in US 34 of the fastest-growing 50 retailers have
just one format
 Inventory turns ratio: measures efficiency of operations. The U.S. retail
sector has an average inventory turns ratio of about 18. Many Indian
retailers KPMG surveyed have inventory turns levels between 4 and 10.
 Global best-practice retailers can achieve more than 95 percent availability
of all SKUs on the retail shelves (translating into a stock-out level of less
than 5 %).The stock-out levels among Indian retailers surveyed ranged
from 5 to 15 percent.
44
Future direction: Positives
 AT Kearney has estimated India’s total retail market at US$ 202.6 billion
which is expected to grow at a compounded 30 per cent over the next five
years.
 With the organised retail segment growing at the rate of 25-30 per cent per
annum, revenues from the sector are expected to triple from the current
US$ 7.7 billion to US$ 24 billion by 2010.
 The share of modern retail is likely to grow from its current 2 per cent to 1520 percent over the next decade
 Over next two years India will see several Indian retail businesses attaining
a critical mass as growth in the industry picks up momentum driven by two
key factors:
– Availability of quality real estate and mall management practices
– Consumer preference for shopping in new environments
 Wal-Mart : huge plans for India. Moving a senior official from its
headquarters in Bentonville, Arkansas, to head its market research and
business development functions pertaining to its retail plans in India.
 New York-based high-end fashion retailer Saks Fifth Avenue has tied up
with realty major DLF Properties to set up shop in a mall in New Delhi.
 Tommy Hilfiger, retailer of apparels, expects to open one store each in
Delhi, Ahmedabad, Lucknow and Bangalore in the next four months.
Future direction: Concerns
 68 million square feet of mall space is expected to be available by end of
2007, which might lead to over-capacity of malls
 Lack of differentiation among the malls that are coming up. One option may
be to look at specialization.
45
 Poor inventory turns and stock availability measures - retailers clearly need
to augment their operations.
 Operations of retailers and suppliers are not integrated. Efficient
replenishment practices practiced in the Indian auto and auto-component
industry can be leveraged to implement efficient supply chain management
techniques.
 Supplier maturity, in terms of adherence to delivery schedules and
delivering the quantity ordered, is an issue
 Sales tax laws - lead to retailers having state-level procurement and
storage leads to Indian retailers having higher inventories. VAT has helped
alleviate this a bit.
 Increased adoption of IT and shrinkage management will be a critical area.
 Supply chain and customer relations followed by merchandising, facilities
management and vendor development are areas which have significant
gaps and proactive training is a key imperative for overcoming these.
PERCENTAGE OF ORGANIZED
RETAIL
3%
8%
2%
9%
38%
13%
INTRODUCTION ABOUT THE VISHAL MEGA MART
27%
USA
EU
Japan
China
India
Russia
Others
46
INTRODUCTION OF
ORGANISATION
47
MAJOR ORGANISED RETAILER IN UDAIPUR CITY
•
VISHAL MEGA MART
•
RELIANCE FRESH
•
V MART
•
SAHAKARI UPBHOKATA BHANDAR
•
SUBHIKSHA
Introduction
Organized relating in India, is chanting the way people used to feel about
shopping. What was once thought to be the favorite activity of housewives is
now, an enjoyable experience for everybody. Form shopping in overcrowded,
unorganised and at times upon market under scorching heat, to shopping in an
AC environment with great music and thousand of times across different
categories with freedom to touch , feel and try , the Indian consumer has certainly
come along way . Shopping , which was once thought to be a burdensome
activity , especially by male member , has now become a great source of Fun
and enjoyment ,not only for individual shoppers but also for families who can be
48
seen rushing to malls, hypermarkets, departmental store discount store and other
form of organised retail outlet ,specially on weekends. They are buying more than
what they are plan and are spending huge amount of money on an environment,
which gives them great Fun and excitement.
However, such a shift in the attitude towards shopping has only
been limited to metros and some of the other cites and towns, where malls,
hypermarket and discounting stores like big bazaar, vishal mega mart (VMM),
Subhiksha, food bazaar, etc., are opening up. A large part of the Indian
population is yet to get the exposure to such shopping experiences. In fact, the
share of organised retailing in India India is only 3-4%, which means organised
retiling will take more than a decade to reach rural India.
In Udaipur city, vishal mega mart came up as the first organised retail
outlet in the form of a mini hypermarket cum discount store, in the year 2007.
With its inception in Udaipur, shopping got an all together new meaning. A Big
parking lot a centralized AC environment covering fore special floors, soothing
music, a tempting visual display of products with self selection facility to choose
from a wide assortment and a verity of product priced with occasional heavy
discount are some of the striking features of the vishal mega mart retail outlet . It
has made shopping, an altogether enjoyable experience. Unlike traditional
shopping, when one had to go many outlets under scorching heat, vishal mega
mart has many items under one roof along with a reasonably priced food joint
where one can relax, on getting tired. It is assumed that it will affect the way in
which people in Udaipur city purchase and consumer things. Moreover,
competing retailers are afraid of gaiting eaten by this big fish.
49
Introduction about vishal group:
Vishal Group launched their first hyper market Vishal Mega mart in
Udaipur. Spread over 25,000 sq. ft, the store offers extensive range of men's,
women's and kids' range of fashion clothing. Beside fashion attire, it will also
have separate sections and counters for watches, sunglasses, fashion
accessories, gifts and novelties, electrical appliances, digital diaries, perfumes,
cosmetics and grocery items etc.
Currently, Vishal Mega Mart operates 29 fully integrated and self-owned
stores spread over a total shopping area of 5,70,000 sq.ft in 21 cities across India
Vishal
Retail Ltd. has a factory in Gurgaon, Haryana. This factory has more than 700
imported machines that have a capacity to manufacturer 150000 pieces a month.
The factory occupies 80000 sq ft of covered space. The Vishal group indirectly
gives employment to more than a 1000 people. These people work in ancillaries
that supply finished goods to the company.
Vishal Retail Ltd. started as a humble one store enterprise in 1986 in
Kolkata (erstwhile, Calcutta) is today a conglomerate encompassing 183
showrooms in 110 cities / 24 states across India. It is covering about 29, 90, 146
sq. ft.. India’s first hyper-market has also been opened for the Indian consumer
by Vishal. Situated in the national capital Delhi this store boasts of The group had
a turnover of Rs. 1463.12 million for fiscal 2005, under the dynamic leadership of
Mr. Ram Chandra Agarwal. The group had a turnover of Rs 2884.43 million for
fiscal 2006 and Rs. 6026.53 million for fiscal 2007.
The group’s prime focus is on retailing. The Vishal stores offer affordable
family fashion at prices to suit every pocket. The group’s philosophy is integration
and towards this end has initiated backward integration in the field of high fashion
by setting up a state of the art manufacturing facility to support its retail
endeavors.
Vishal is one of fastest growing retailing groups in India. Its outlets cater
50
to almost all price ranges. The showrooms have over 70,000 products range
which fulfills all your household needs, and can be catered to under one roof. It is
covering about 29,90,146 sq. ft. in 24 states across India. Each store gives you
international quality goods and prices hard to match. The cost benefits that is
derived from the large central purchase of goods and services is passed on to the
consumer singe largest collection of goods and commodities sold under one roof
in India.
SOME SPECIAL INFORMATION ABOUT VISHAL MEGA MERT:
Vishal Retail Company was incorporated on July 23, 2001 as “Vishal
Retail Private Limited”. After this Company was converted into a public limited
company on February 20, 2006 and the name was changed to “Vishal Retail
Limited”. At present Public Issue of Vishal Retail aggregating to Rs. 1,100 million.
The registered office of Vishal Retail Company was changed from MouzaKuch Pukur, P.S. Bhangore, 24 Paragnas (South), West Bengal to the current
registered office with effect from December 29, 2005.)
Vishal Retail is registered at the Registrar of Companies, National Capital
Territory of Delhi and Haryana situated at Pariyavaran Bhawan, Block B, 2nd
Floor, CGO Complex, Lodhi Road, New Delhi 110 003. Vishal Retail registration
number is
55-147724 and the corporate identification number is
U74999DL2001PLC147724.
51
Overview:
Vishal mega mart (VMM) is one of the leading retail houses in India. As
of November 15, 2006, VMM operated 461 retail stores, including three stores
which are operated by our franchisees. These 46 stores are spread over about
1,113,000 square feet and are located in 17 states across India. In our efforts to
strengthen our supply chain, VMM have set up seven regional distribution centers
and an apparel manufacturing plant.
VMM started as a retailer of ready-made apparels in Kolkata in 2001. In
2003, VMM acquired the manufacturing facilities from Vishal Fashions Private
Limited and M/s Vishal Apparels. Subsequently, with evolution of retail industry in
India and change in consumer aspirations, VMM diversified our portfolio of
offerings to include other retail goods. Currently, VMM sell ready-made apparels
and a wide range of household merchandise and other consumer goods such as
footwear, toys, watches, toiletries, grocery items, sports items, crockery, gift and
novelties.
VMM follow the concept of value retail in India. In other words, There
business approach is to sell quality goods at reasonable prices by either
manufacturing ourselves or directly procuring from manufacturers (primarily from
small and medium size vendors and manufacturers). VMM endeavour to facilitate
one-stop-shop convenience for our customers and to cater to the needs of the
entire family. VMM believe this concept has helped us grow to our current size
within a short time frame of four years.
In order to reduce costs and take advantage of economies of scale Vishal
Mega Mart have embarked on backward integration of there products. There
apparel manufacturing plant is located at Gurgaon, Haryana. For ensuring
efficiency in supply chain, VMM have set up seven regional distribution centers
52
located around Kolkata (West Bengal), Thane (Maharashtra), Jaipur (Rajasthan),
Ghaziabad (Uttar Pradesh), Ludhiana (Punjab), Gurgaon (Haryana) and Delhi.
Further, VMM have focused on developing a cost and time efficient distribution
and logistics network, which currently comprises seven distribution centers and a
fleet of trucks for transportation.
VMM achieved total sales of Rs. 2,884.43 million for fiscal 2006, as
opposed to a turnover of Rs. 1,463.12 million for fiscal 2005 and Rs. 881.04
million for fiscal 2004. During the same period our profit after tax was Rs. 124.74
million, Rs.30.20 million and Rs. 3.82 million, respectively. As a result, our sales
increased between fiscal 2004 and fiscal 2006 at a CAGR of 80.94% and our
profit after tax increased between fiscal 2004 and fiscal 2006 at a CAGR of
471.44%.
PRODUCTS CATEGORIES OF VISHAL MEGA MART
HOME FURNISHING
Drawing Room: Door Mat, Carpet, Curtains
Kitchen :
Apron Kitchen, Napkin
Bedroom:
Bed Sheet ,Pillows, Pillow Cover
Bathroom:
Bath Mats ,Towel Gift Sets
53
FOODMART & BEVERAGES
Beverage
Cooked Indian
Cooked Chinese
Cold Drinks
Fruits & Vegetabl
Snacks
SPORTS & FITNESS
INDOOR GAMES: Basket Ball, T.T. Bat, Boxing
Kit, Swimming Costumes, Water Ball
OUTDOOR GAMES: Cricket Bat, Football ,Lawn
Tennis, Tennis Racket, Tennis Ball
Fitness Equip. Personal Gym
FOOTWEAR
BOYS:
Shoes, Sandals
GIRLS:
Slippers, Sandals
MENS :
Shoes, Slippers
LADIES: Shoes, Slippers
54
TELEMART
Communication: Mobile
Mobile Accessories: Mobile Batteries, Mobile
Charger, Mobile Dori
MENS
Upper: :Shirt Casual, Shirt Formal
Upper Ethnic & Sports: Night Suits, T-Shirts,
Dupatta, Sherwani
Lower: Jeans(MP), Cotton Trouser(MPC)
Winter Wear: Suit(WMC) ,Blazer(WMB),
Windcheater(WMW), Jacket
LADIES ACCESSORIES
Upper:
Kurta ,Skirt Top
Lower:
Pants JeansCapri
Ethnic :
Nighty ,Lancha ,Sharara, Salwar Suit
Winter Wear: Jackets, Stawl ,Blazer, Track Suit
INFANTS
Garments:
Hot Pant, Frock ,Baba Suit.
Accessories: Bed Sheet, Under Garments,
Socks.
Winter Wear: Sweater, Pull Over.
55
WOMEN
Sarees:
Fancy(SRF), Synthetics,
Banarsi
Personal Items: Cap(LCA), Socks(Las)
Jewellery:
Necklace, Ring
Cosmetics:
LIp Gloss, Nail Polish
KIDS BOYS
Lower:
Jeans, Bermudas, Dungries
Sets:
Night Suit, Baba Suit
Winter Wear: Suit, Blazer, Jacket
Upper :
Shirt Formal, T-Shirt
Ethnic:
Kurta- Pyjama, Sherwani
KIDS GIRLS
Lower:
Hot Pant, Skirt, Dungries
Sets:
Night Suit, Capri Set
Winter Wear: Hipster Set, Blazer Blazer, Jacket
Upper:
Tops(GWT), Frock(GFK)
Ethnic:
Sharara, Lancha
56
TRAVEL ACCESSORIES
Luggages:
Suitcase
Pouch & Cases: Waist Pouch, Vanity Cases
Portfolio Bags : Shoulder Bags, Executive Bag
,School Bags
KITCHEN
Acrylic Ware:
Dinner Set
Home Aids:
Floor Wiper,Sanitary
Brush
General Plastic Goods:Coffee Mug ,Bucket
Glass Ware
Cup, Lemon Set
Copper:
Jug
Pressure Cooker:
Cooker,Pressure Pan
Electrical App.:
Chopper,Microwave
Oven
Thermo Ware :
Tiffin,Container
Steel:
Cake Server
Non Stick:
Handi,Dosa Tawa
Bone China :
Soup Set,Dessert Set
Porcelain:
Cup & Saucer
TOYS & GAMES
Soft Toys :
Musical Toys,Non-Musical
Board Games :Wooden Blocks -Puzzles
Dolls:
Barbie Doll,Other Dolls
Infant Toys :
Teether-Swing
Cycles & Scooters: Cycles,Scooters
Video Games : T.V. Video Game-Hand Video
Game
57
STATIONARY
School :Exam Board,Clay
Party Stuff :Balloons -Ribbons
Office:Office File,Punching Machine
Paper Mart :Diary,File
HOUSEHOLD
Cleaning Aids
Plastic Aids
Kitchen Wares
Appliances
58
RELIANCE FRESH
APKA FRESH APKA PADAOS ME
India’s Fortune 500 private sector giant, Reliance Industries Ltd, has, in fact, been first
off the blocks by launching its first Reliance Fresh outlets in Hyderabad,
Reliance fresh is the retail chain division of reliance industries of India which is headed
by mukesh ambani. Reliance has entered into this segment by opening new retail stores
into almost every metropolitan and regional area of India. Reliance plans to invest rs
25000 crores in the next 4 years in their retail division and plans to begin retail stores in
784 cities across the country. The reliance fresh supermarket chain is ril’s rs 25,000
crore venture and it plans to add more stores across different g, and eventually have a
pan-India footprint by year 2011. The super marts will sell fresh fruits and vegetables,
staples, groceries, fresh juice bars and dairy products and also will sport a separate
enclosure and supply-chain for non-vegetarian products. Besides, the stores would
provide direct employment to 5 lakh young Indians and indirect job opportunities to a
million people, according to the company. The company also has plans to train students
and housewives in customer care and quality services for part-time jobs.
59
RELIANCE FRESH IN UDAIPUR
Part of Reliance Industries of India Fresh supermarket opened its doors
Reliance
Fresh supermarket opened its door
RELIANCE FRESH
.Reliance Fresh is the convenience store format Part of Reliance Industries of India
which is headed by Mukesh Ambani RIL’s dream of retail revaluation gotkicked-started
in AP when its Reliance Fresh supermarket opened its doors
to World.Following the first , company opened10 more stores as a first step towards
creating a mega retail chain across the country
The Reliance Fresh supermarket chainwas Ril’s Rs. 25000 crores venture
It sells fruits , vegetables, stapels ,groceries, and dairy producCont… Retail chain
closely follows the moves of global players like Wal-Mart store Inc and Metro AG
seeking to open shop here in country
It has almost more than 500 fresh across the country Corporates -Indian Retail
.
60
Product range

Vegetables and fruits.

House hold Items.

.Food and Beverages.

Groceries.

Dairy Products

Refrigerated product

Non food items.

Ready to eat items.
61
OBJECTIVES
&
RESEARCH METHODOLOGY
62
Objective of the study
The main aim of the present study is to accomplish the following objectives:
1. To find out the customer preferences while selecting retail shop in
udaipur city
2. To find out the various factor which affect purchase decision.
3. To find out the customer satisfaction level at various retail shop in
udaipur city
63
RESEARCH
METHODOLOGY
64
RESEARCH METHODOLOGY
1.Nature of data:
(a)primary data-collected through questionnaire
(b)Secondary data- collected through newspaper, magazine
& websites.
2.Sample size-
50 Respondents
3.Sample design-
convenience sampling
4.Research design –
Descriptive research design
5.Area of Study -
Udaipur City
6.Questinnaire design- Form the purpose of study a structured questionnaire was
Prepared.
65
DATA ANALYSIS
AND
INTERPRETATION
66
1.Gender
No. of Respondent
Percentage
Male
23
46
Female
27
5
Total
50
100
GENDER
28
27
NO OF RESPONDENT
27
26
25
24
23
23
22
21
MALE
FEMALE
INTERPRERATIONFrom above data 23 respondent is male and 27 is female.
67
2.Age
Age wise distribution of Respondents
Age
No. of Respondent
Percentage
15-25
7
14
25-35
21
42
35-45
20
40
45& above
2
4
total
50
100
Age in year
no of respondent
25
21
20
20
15
10
7
5
2
0
15-25
25-35
35-45
45& above
age group
Interpretation1. From above data majority of purchaser is 25-35 age group .
2. 35-45 age group also major purchaser as compared to age group 15-25 , 45 &above
year.
68
3. Occupations
Occupation wise distribution of Respondents
Occupation
No. of Respondent
Percentage
Student
9
18
Self-employed
8
16
salaried
18
36
Professional
14
28
other
1
2
total
50
100
Occupations
20
18
18
No of Respondent
16
14
14
12
9
10
8
8
6
4
1
2
0
Student
Self-employed
salaried
Professional
other
Interpretation
1.Salaried person purchase from the retail shop most 36%.
2.Student & professional also purchase the retail shop in big percentage.
69
4.Monthly Income
Income wise distribution of Respondents
Monthly Income
No. of Respondent
Percentage
Below 10000
18
36
10000-20000
19
38
20000-30000
6
1
30000-40000
6
12
40000 & above
1
2
total
50
100
Monthally Income (Rs.)
20
18
19
18
No of respondent
16
14
12
10
8
6
6
6
4
1
2
0
Below 10000
10000-20000
20000-30000
30000-40000
40000 & above
Interpretation
1. majority of person who monthly income Rs.10000-20000 is purchase from
organised retail shop.
2. Income group below Rs.10000 is also main purchaser of organised retail shop.
70
5.Frequency of Purchase
Frequency wise distribution of Respondents
Frequency
No. of Respondent
Percentage
Daily
9
18
Twice a week
13
26
More than Twice a
4
8
8
16
Once a month
16
32
total
50
100
week
More than Twice a
Month
Frequency of Purchase
18
16
No of respondent
16
13
14
12
9
10
8
8
6
4
4
2
0
Daily
Tw ice a w eek
More than Tw ice a More than Tw ice a
w eek
Month
Once a month
Interpretation
1. Frequency of purchase is mostly is once a month due to shortage of time.
2. Daily purchase is also 18%.
3. Twice a week also purchase is 26%.
71
6.Monthally Purchase
Purchase wise distribution of Respondents
Monthly Purchase
No. of Respondent
Percentage
Below Rs.500
9
18
Rs.500-1000
10
20
Rs.1000-1500
12
24
Rs.1500-2000
8
16
More thanRs.2000
11
22
total
50
100
No of respondent
Monthally Purchase
14
12
12
9
10
8
11
10
8
6
4
2
0
Below Rs.500 Rs.500-1000 Rs.1000-1500 Rs.1500-2000
More than
Rs.2000
Purchase Group
Interpretation
1. People monthly purchase is maximum is Rs. 1000-1500.
2. All group is almost same purchase.
72
7. Person influenced for organised retail purchase-
Person wise distribution of Respondents
No. of Respondent
Percentage
Friend
21
42
Impulse
4
8
Advertisement
11
22
Promotions
3
6
Relative / friend
11
22
total
50
100
INFLUANCES
25
No of Respondent
21
20
15
11
11
10
4
5
3
0
Friend
Impulse
Advertisement
Promotions
Relative
Interpretation
1. Mainly people purchase to organised retail shop due to influences of friend 42%.
2. Advertisement is also affective tool which affect purchase decision.
3. Relative also impact 22% on purchase decision.
4. Impulse & promotions is low percentage.
73
8.Time of Purchase
Time wise distribution of Respondents
Time
No. of Respondent
Percentage
9AM-1PM
12
24
1PM-5PM
10
20
5PM-9PM
25
50
9PM-1AM
3
6
Total
50
100
Tim e of Purchase
30
25
No of respondent
25
20
15
12
10
10
3
5
0
9AM-1PM
1PM-5PM
5PM-9PM
9PM-1AM
Tim e
Interpretation
1. Mainly people purchase organised retail shop at time slot 5 pm -9pm.
2. 9am -1pm & 1pm-5pm is also good purchase time ..
74
9. Product purchase
(1 for best 6 for least)
S.no
Product name
Average Rank
1
Food products
1.16
2
Grocery
2.56
3
Apparels
4.02
4
Electrical and electronics
4.34
5
Daily use product
3.44
6
Toiletries
5.38
Product Purchase
5.38
6
Average Rank
5
4.02
4.34
3.44
4
2.56
3
2
1.16
1
0
Name of Product
Interpretation
1. 56% respondent purchase food product from organised retail shop.
2. 40% Respondents purchase grocery items.
3. 32%people purchase daily use items.
75
10. Payment Mode
No. of Respondent
Percentage
Cash
41
82
Credit card
9
18
Total
50
100
NO OF RESPONENT
PAYMENT MODE
45
40
35
30
25
20
15
10
5
0
41
9
CASH
CREDIT CARD
MODE
Interpretation
1. 82% respondent payment the bill through cash.
2. 18% people pay the bill through credit card.
76
Factor Affecting Purchase
Decision
77
Factor affecting purchase decision
(1for best 6 for least)
S.no Factor which affect selecting retail shop
Average
Rank
1
Convenience
2
Quality
3
Product Availability
4
1.44
2.14
5
Price level
Offer & scheme
6.
Service quality
2.30
2.72
3.56
3.58
Interpretation
convenience is main factor which affect purchase decision.

quality is also factor which affect purchase decision.
78
Customer satisfaction level
79
1.Price level
No. of respondents
Percentage
Strongly satisfied
4
8
Satisfied
20
40
About Average
16
32
Some what satisfied
6
12
Dissatisfied
4
8
total
50
100
Price of product in organised retail shop
25
No of Respondent ent
20
20
16
15
10
6
5
4
4
0
Strongly satisfied
Satisfied
About Average
Some what
satisfied
Dissatisfied
Interpretation
1. 40% respondent is satisfied.
2. 32% respondent average satisfied.
3. very few respondent is strongly satisfied.
4. very few respondent is dissatisfied.
80
2. Availability of product
No. of respondents
Percentage
Strongly satisfied
13
26
Satisfied
21
42
About Average
7
14
Some what satisfied
6
12
Dissatisfied
3
6
total
50
100
Avalibility of product
No of Respondent emt
25
21
20
15
13
10
7
6
5
3
0
Strongly
satisfied
Satisfied
About Average
Some what
satisfied
Dissatisfied
Interpretation
1.42% Respondent is satisfied.
2.26 %Respondent is very satisfied.
3.Only 6%respondent is dissatisfied.
81
3. Quality of product
No. of respondents
Percentage
Strongly satisfied
14
28
Satisfied
23
46
About Average
7
14
Some what satisfied
4
8
Dissatisfied
2
4
total
50
100
Quality of product
25
23
no of respondent
20
14
15
10
7
4
5
2
0
Strongly satisfied
Satisfied
About Average
Some what
satisfied
Dissatisfied
Interpretation
1.46% Respondent is satisfied with product quality
2.28% Respondent strongly satisfied with product quality.
82
4.Offer & Scheme
No. of respondents
Percentage
Strongly satisfied
5
10
Satisfied
6
12
About Average
12
24
Some what satisfied
5
10
Dissatisfied
17
34
total
50
100
Offer & Scheme
18
17
16
No of respondent
14
12
12
10
10
8
6
6
5
4
2
0
Strongly
satisfied
Satisfied
About Average
Some what
satisfied
Dissatisfied
Interpretation1.34%Respondent is dissatisfied with offer & scheme
2.10%people is very satisfied.
3.24% people is average satisfied.
83
5. Convenience
No. of respondents
Percentage
Strongly satisfied
37
74
Satisfied
8
16
About Average
2
4
Some what satisfied
2
4
Dissatisfied
1
2
total
50
100
No of Rsspondent
convenience
40
35
30
25
20
15
10
5
0
37
8
Strongly
satisfied
Satisfied
2
2
1
About
Average
Some what
satisfied
Dissatisfied
Interpretation1.74% Respondent is strongly satisfied.
2.16% Respondent is satisfied with convenience.
3. 4% Respondent average satisfied .
84
6.Store hour for Purchase
No. of respondents
Percentage
Strongly satisfied
15
30
Satisfied
25
50
About Average
10
20
Some what satisfied
0
0
Dissatisfied
0
0
total
50
100
Store hour
30
no of Respondent
25
25
20
15
15
10
10
5
0
0
Some what
satisfied
Dissatisfied
0
Strongly satisfied
Satisfied
About Average
Interpretation1.50%Respondent is satisfied.
2.30% Respondent is strongly satisfied.
3.0% Respondent is dissatisfied.
85
7. Atmosphere and Décor Appealing
No. of respondents
Percentage
Strongly satisfied
13
26
Satisfied
14
28
About Average
21
42
Some what satisfied
2
4
Dissatisfied
0
0
Total
50
100
Atmosphere and Decor Appealing
no of respondent ent
25
21
20
15
13
14
10
5
2
0
0
Strongly
satisfied
Satisfied
About Average
Some what
satisfied
Dissatisfied
Interpretation1.42%Respondent average satisfied .
2.zero respondent is dissatisfied.
86
8. Display of mercandise-
Parameter
No. of respondents
Percentage
Strongly satisfied
20
40
Satisfied
21
42
About Average
5
10
Some what satisfied
4
8
Dissatisfied
0
0
Total
50
100
Attractive Display of mercandise
No of respondent
25
20
21
20
15
10
5
4
5
0
0
Strongly
satisfied
satisfied
About Average
Some what
Satisfied
Dissatisfied
Interpretation
1. 42%Respondent are satisfied with display of merchandise.
2. 40% Respondent are strongly satisfied with display of merchandise.
3 No one dissatisfies with display of merchandise.
87
9. Advertised merchandised in stock
No. of Respondent
Percentage
Yes
48
96
No
2
4
Total
50
100
advertised merchandised in stock
60
48
No ofResponent
50
40
30
20
10
2
0
yes
no
Interpretation
1.96%Respondent say yes that advertised merchandised in stock.
88
10.Overall Customer satisfaction level
Parameter
No. of respondents
Percentage
Strongly satisfied
13
26
Satisfied
25
50
About Average
6
12
Some what satisfied
4
8
Dissatisfied
2
4
Total
50
100
30
25
20
15
10
5
0
25
13
6
4
d
2
tis
sa
is
D
Sa
tis
So
m
e
w
ha
t
fie
fi e
d
ge
ra
ut
Av
e
sa
tis
fie
d
Ab
o
St
ro
ng
ly
sa
tis
fie
d
No of respondent
Overall satisfaction
Interpretation
1. 50%Respondent satisfied with organised retail shop.
2. Only 4% Respondent dissatisfied with organised retail shop.
89
FINDINGS
90
Finding
Profile of customer
from above data 23 respondent is male and 27 is female.

from above data majority of purchaser is 22-29 age group.

Most of people who Purchase from these organised retail shop were salaried
person (36%)

majority of person whose monthly income Rs.10000-20000 were purchase From
organised retail shop.
Preferences

frequency of purchase is mostly is once a month in most of cases due to shortage of
time.

People monthly purchase is maximum is Rs. 1000-1500.

mainly people purchase to organised retail shop due to influences of friend (42%)

advertisement is also affective tool which affect purchase decision

The preferred shopping time slot was evening 5pm -9pm .people shopping after
their office hours.

Mostly respondent purchase food product from organised retail chain

Mainly mode of payment is cash.
Factor
Convenience is main factor which affect purchase decision.

Quality is also major factor which affect purchase decision.

Offer& scheme is less important factor.
91
Satisfaction level

Price were reported to be very satisfactory (40% )as majority (40%)have reported
very satisfactory.

42% respondent say that availability of product is satisfied

35%Respondent is dissatisfied with offer & scheme .

Most respondent strongly satisfied.

50%respondent response that store hour for purchase is satisfied.

96%respondent say yes that advertised merchandised in stock.

The mode of payment was by cash (82%)by the majority as the profile is that most
of them do not own a credit card .

50%Respondent satisfied with organised retail shop.
92
SUGGESTIONS & RECOMMENDATIONS
93
SUGGESTIONS & RECOMMENDATIONS

organised retail shop more purchase food items so retail shop pay more attention
towards food items .

offer & Scheme is very less so make offer & Scheme attractive.

Convenience is main factor which affect purchase decision so company main
focus on it.

Store hour is also important factor which affect purchase decision most people
purchase at time slot 5pm-9pm.

4% people not satisfied so organised retail shop take some action to satisfied
them.

More people payment through cash so cash payment system made more
effective.
94
LIMITATION
95
Limitations of the Study: The study has been conducted only in Udaipur city..
 Non-response by some of the respondent.
 there was a certain degree of misinterpretation or mislead by the respondents
about the points raised in the questionnaire.
 size of the sample is small.
96
APPENDIX
97
Questionnaire
An empirical study on consumer preferences while selecting organised retail
Shop in udaipur city
Name ------------------------------------------------------------------------------------1. Gender (a)male
(b)Female
2. Age –
(a) 15-21year
(b) 22-29 year
(c) 30-44 year
(d) 44& above year
3. Occupation(a)student
(b)self employed
(d)professional
(e)other
(c)salaried
4 .Monthly Income(a) below Rs.10000
(b) Rs.10000-20000
(c) Rs.20000-30000
(d) Rs.30000-40000
(e) Rs.40000&above
5.Frequency of purchase(a) Daily
(b)Twice a week
(d) More than twice a month
(e) Once a month
(c) More than twice a week
6.Monthally How much you purchase(a) Below Rs 500
(b) Rs 500-1000
(d) Rs 1500-2000
(e) More than Rs. 2000
(c) Rs 1000-1500
7. Who influenced you for organised retail purchase(a) Friend
(b) Impulse
(d) Promotions
(e) Relative
(c) Advertisement
98
8. At what time you mostly purchase(a) 9AM -1PM
(b)1PM-5 PM
(c) 5PM-9AM
(d)9PM-1 AM
9. Which Product have you purchaseS.No Product name
Rank (1 for best 6 for
least)
1.
Electrical and electronics
2.
Apparels
3.
Food products
4.
Toiletries
5.
Grocery
6.
Daily use product
10. Payment mode
(a) Cash
(b)Credit card
11.The factor which affect your selecting retail outlet for purchase
Rate themS.No Factor
Rank (1 for best 6
for least)
1.
Convenience
2.
Product quality
3.
Price
4
Product Availability
5
Service quality
6
Offer & scheme
99
satisfaction level
12
Rate themS.No
Factor
1.
Price Level
2.
Availability Of Product
3.
Quality Of Product
4.
Offer & Scheme
5.
Convenience level
6.
Store Hour For Purchase
7.
Atmosphere And Décor Appealing
8
Attractive display of merchandise
(I for best ,5 for least)
1
2
3
4
5
13.Overall Customer Satisfaction
(a) Strongly satisfied
(b) Satisfied
(c) About Average
(d) Some what satisfied
(e) Dissatisfied
100
BIBLIOGRAPHY
WEBSITES:
 www.retailindia.com
 Indian journal of marketing Feb. 2008
 Icfai journals university press sep 2006
 www.retailsactor.com
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