Chapter 2: Retail Formats and Theories V3.0
Certificate in Retail ManagementL-1
TCS Business Domain Academy
Chapter 2: Retail Formats and Theories V 3.0
Learning Objectives
After reading this session you will know:
• About the Retail Formats.
• About Evolution of Retail Formats.
• About Retail Life Cycle.
• About Theories of Retail Management and Classification of Retail
Formats.
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
Topics Covered
•
Evolution of Retail Formats
•
Theories in Retail development
•
The Retail life cycle
•
Phases of growth of Retail markets
•
Classification of Retail stores
•
Franchising
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
Evolution of Retail Formats
• Retail formats evolved with evolving purchasing patterns and buying
behaviors.
• People have different choices and highly different buying behaviors.
• Traditionally in India we had mom-pop stores.,
• Modern day retail complexes have multiplexes, food courts,
entertainment centers, beauty salons and many other facilities .
• These formats evolved so that they can give their customers the
ultimate shopping experience.
• Retail formats evolved with the rise of incomes of consumers.
• There are many different formats that retailers use
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
Factors Influencing Choice of Format
• The first is the target customers - his/her likes and dislikes.
• The second is the attribute retailer wants to target
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
The Connection Between Formats and
Demographics
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
Theories in Retail Development
Environment Theory : Darwin’s principle.
“survival of the fittest”
• It simply states that a retail establishment is influenced by its environment,
mainly its customers, competitors, suppliers, distributors, transporters,
government regulations etc.
• A retailer will implement the policies which enable him to fit in the environment,
both externally and internally.
• A smart retailer is one who knows and understands the pulse of the customer
and every stake holder
• Retailer has to integrate all the partners so that they can work in
synchronization.
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
Cyclical Theory : The Will and the Wheel
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
Conflictual Theory
• Conflictual
theory states that there will be conflict among retail
formats
• Retail formats will be created as new retailers will come and
experiment with the formats, thus leading to the development of
more formats
•E.g. Branded + Discount store = Branded Discount Store.
e.g. Brand Factory of Pantaloons
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
The Retail Life Cycle:
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
Classification of Retail Formats.
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
Factors Responsible For Retail Growth in India
• Easy availability of finance.
• Better supply chain management thanks to advanced IT tools and better
operations.
• Consumerism wave across India.
• Favorable External and internal environment.
• New investments in retail sector.
• Rise of PPP (public private partnership) in retail projects.
• Retail sector in Expansion mode.
• Entry of big players such as reliance, pantaloons and Tata’s.
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
Franchising
ØFranchising is a legal and contractual association between the service
provider, the manufacturer or the wholesaler which are known as
franchisers with independent business people which are known as
franchisees who agree to carry out the business of franchiser on their
behalf.
ØFranchising is also being used by online companies as a means to
expand their network and offer personalized services. Ex. Shaadi.com
ØIn India, every franchising relationship is a contractual relationship and
therefore the Indian Contract Act, 1872 would be applicable to all
franchising arrangements.
Certificate in Retail Management L-1
Chapter 2: Retail Formats and Theories V 3.0
Summary
• How retail has evolved in India, its journey from unorganized to organized
format.
• Different formats and formats relationship with target audience.
• The Retail life cycle, its phases and its application to current Indian retail market.
• The different retail formats with emphasis on Indian retail sector.
• The concept of franchising and how it is catching up with Indian mindset.
Certificate in Retail Management L-1
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