Retail Strategy - Food & Beverages: Store strategies of major modern stores & Preferences of Bangalore consumers

Food & Beverages: Store strategies
of major modern stores &
Preferences of Bangalore
consumers
Retail Strategy Group Project

Team:
D.Gopalakrishnan (0910021)
Rakesh Bhansali (0910052)
Sandeep Yadav (0910054)
Vivek Gupta (0910073)

INDIAN INSTITUTE OF MANAGEMENT, BANGALORE

September 20, 2009

Table of Contents
AIM ............................................................................................................................ 2
METHODOLOGY........................................................................................................ 2
INTRODUCTION ........................................................................................................ 4
A. RETAIL SECTOR IN INDIA ..................................................................................... 4
B. FOOD RETAIL INDUSTRY IN INDIA .......................................................................... 8
MAJOR FOOD & GROCERY RETAIL CHAINS............................................................ 13
CONSUMER FEEDBACK .......................................................................................... 14
A. DEMOGRAPHICS: ............................................................................................... 14
B. BUYING BEHAVIOUR:.......................................................................................... 15
C. PURCHASE PREFERENCE: .................................................................................. 17
STORE AUDIT FINDINGS .......................................................................................... 19
A. FOODWORLD – BANNERGHATTA ROAD ................................................................ 19
B. BIG BAZAAR – JAYANAGAR 9TH BLOCK .................................................................. 20
Food & Beverages: Store strategies of major modern stores & Preferences of Bangalore consumers | 9/20/2009

C. SPAR – NEAR SAGAR APOLLO HOSPITAL ............................................................. 20
D. COMPARISON .................................................................................................... 21
A. ASSORTMENT ................................................................................................... 21
B. RANGE OF PACK SIZES ....................................................................................... 23
C. CHEAPEST BRAND ............................................................................................. 24
D. COSTLIEST BRAND ............................................................................................ 26
E. AGGRESSIVENESS TOWARDS “STORE BRAND” ...................................................... 27
F. SPACE DEDICATED FOR EACH ITEM ...................................................................... 29
STORE STRATEGY................................................................................................... 30
1. FOODWORLD: ................................................................................................... 31
2. BIG BAZAAR: ..................................................................................................... 31
3. SPAR: .............................................................................................................. 31
OPPORTUNITIES & CHALLENGES ........................................................................... 32
“KIRANA” STORE: ...................................................................................................... 32
ORGANIZED RETAIL:.................................................................................................. 33
SUPERMARKET FORMAT: ........................................................................................... 34
HYPERMARKET FORMAT: ........................................................................................... 34
CONCLUSION ........................................................................................................... 35
REFERENCES: ......................................................................................................... 37
EXHIBITS: ................................................................................................................. 38
EXHIBIT-01: STORE AUDIT FORMAT ............................................................................ 38
EXHIBIT-02: CONSUMER SURVEY FORM SAMPLE ......................................................... 38
EXHIBIT-03: PHOTOS & UNIQUE FEATURES OF FOODWORLD SUPERMARKET, BG ROAD ... 41
EXHIBIT-04: PHOTOS & UNIQUE FEATURES OF FOOD BAZAAR SUPERMARKET, JAYANAGAR, 9TH
BLOCK..................................................................................................................... 42
EXHIBIT-05: PHOTOS & UNIQUE FEATURES OF SPAR HYPERMARKET, NEAR SAGAR APOLLO
HOSPITAL ................................................................................................................ 43

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Food & Beverages: Store strategies of
major modern stores & Preferences of
Bangalore consumers
Retail Strategy Group Project

AIM
To study:

1. The growth of retail business in India with special focus on Food and

Beverage retailing.
2. Strategies of few major modern superstores (for foods and beverages
business) in Bangalore viz.:
a. Foodworld (Bannerghatta Road)
b. Spar (Near Sagar Apollo Hospital)
c. Big Bazaar (Jayanagar 9th block)
3. Consumer purchase behavior and preferences of Bangalore consumers for
food and beverage products.

The above studies will help us to understand the extent of consumer needs being
met by the present leading supermarkets or hypermarkets (with regard to the Food
and Beverages needs).

It will hence help us understand the gap between the consumer needs and the
offerings of the stores in order to enable us to formulate few strategies for gaining
higher share of wallet of the urban middle class Bangalore consumers.

The reason that we chose to study the Food and Beverages is that even though it
contributes to approx. 60% of the total retail industry, it contributes merely 11% of
the organized retail which shows the immense opportunity in the particular segment.

METHODOLOGY

In order to understand the assortment and pricing strategies of the various
supermarkets/hypermarkets listed above, we visited these stores and audited 25
food and beverage products listed below (see Audit Format in Exhibit-01) which

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comprise the major food items consumed by an average urban middleclass Indian
household:

A. Dairy and Poultry products (6 items)
B. Fruits and Vegetables (6 items)
C. Grains, Pulses and Edible oil (8 items)
D. Snacks, Drinks and Beverages (5 items)

For the above 25 items, we gathered and analyzed the following data for each of the
4 modern format stores:

1. Assortment – No. of brands, No. of types

2. Pack Size – Minimum, Maximum
3. Range – Cheapest brand, Costliest brand
4. Availability of store brand
5. Manufacturing date of oldest item (Perishable products with shorter shelf life)
6. No. of racks dedicated for each item

The above data will help us analyze the strategy of each store and also the type of
consumer being targeted by them.

In order to understand the preferences and buying behavior of Bangalore consumers
we conducted a survey of few consumers residing in the vicinity of Bannerghatta
Road, Bangalore as the stores which we studied were close to this area itself. This
would have ensured appropriateness of the conclusions which we would draw as
there could be variations between various outlets of the same retail chain situated at
various locations of the city.

Through our survey we have attempted to capture the following information from the
urban middle class consumers of Bangalore (see Survey Form sample in Exhibit-02):

A. Demographic information
B. Buying Behaviour
C. Purchase preference
D. Feedback about their “preferred store”

The combination of the above data will help us in correlating the consumer
preferences with the consumer needs being presently met by each of the stores.

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Hence, it will eventually help us evolve a strategy that can be followed for the Food
and Beverages section of a supermarket or a hypermarket in order to serve the
maximum needs of urban middle class consumers in order to grab a higher share of
wallet of that particular stratum of consumers.

INTRODUCTION

A. Retail Sector in India
Retailing in India is emerging as one of the largest industries with a total
market size of Rs.13,300 bn in 2007 growing at a CAGR of approximately
11% per annum during the last 5 years.

Rising income and increased consumerism will further propel the growth
happening in the urban areas.

% of urban population in India
30.0%
28.0%
26.0%
24.0%
22.0%
20.0%
18.0%
16.0%
14.0%
12.0%
10.0%
1951 1961 1981 1991 2001

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This driver is further illustrated in the statistic that the percentage of people in
the urban areas in India has been steadily growing to reach 29% from just
17% some 50 years ago.
In addition, India has been ranked as the most attractive market for global
retailers to enter now according to A.T.Kearney‟s Global Retail Development
Index for 2006. The GRDI conducted to follow the attractiveness of top
emerging markets for retail.

Many factors contribute to India being the most attractive retail target market.
A stable democracy alongwith robust economic growth has been driving
increasing prosperity and consumerism.
The Indian retail market has been gaining strength, riding on the sound vibes
generated by a robust economy that has given more disposable incomes in
the hand of the consumer who will keep demanding better products and
services, and a better shopping environment.
In the overall Retail pie, Food and Grocery was the dominant category with
59.5% share, valued at Rs.792,000 crore, followed by Clothing and
Accessories with a 9.9% share at Rs.131,300 crore. Interestingly, out-of-home
food (catering) services (Rs.71,300 crore) has overtaken Jewellery
(Rs.69,400 crore) to become the third largest retail category, with a 5.4%
market share – this largely reflects the massive employment opportunities to
youngsters in the services sector and accompanying changes in consumer
lifestyles.

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Consumer durables (Rs.57,500 crore) is the fifth largest retail category
followed by Health & Pharmaceuticals (Rs.48,800 crore), Entertainment
(Rs.45,600 crore), Furniture, Furnishings & Kitchenware (Rs.45,500 crore),
Mobiles & Accessories (Rs.27,200 crore), Leisure retail (Rs.16,400 crore),
Footwear (Rs.16,000 crore), Health & Beauty Care services (Rs.4,600 crore)
and Watches & Eyewear (Rs.4,400 crore) in the order.


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In the Organised retail segment, the picture is different altogether. Clothing &
Fashion Accessories is the largest category with 38.1% of the market share,
valued at Rs.29,800 crore, followed by Food & Grocery accounting for 11.5%
of the organised retail market at Rs.9,000 crore , Footwear with 9.9% of the
organized retail market share at Rs.7,750 crore, Consumer Durables with
9.1% market share at the fourth place (Rs.7,100 crore), and Out-of-home food
(catering) services and Furniture, Furnishings & Kitchenware retail in the
order.
The mobile & accessories retail market has shown fastest growth in 2007
(25.6%) over the previous year, the other two prominent categories being out-
of-home food (catering) services where growth was 25.1% and books, music

& gifts leisure category which achieved 23.3% growth.

In the organised retail segment, however, the fastest growth was recorded in
the tiny health & beauty care services category (Rs.660 crore), which grew at
the rate of 65% in 2007 over the previous year – again a reflection of rise in
services sector employment that demands proper grooming. The second
fastest growing organised retail category is that of Entertainment (53.8%),

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followed by the mobile phones & accessories and the food & grocery retail
categories, both of which achieved 55.2% growth in 2007.
At constant prices, the overall food & grocery retail market grew slightly higher
at 2.3% in 2007 as compared to a 2.2% annual growth in the previous two
years.

But the organised retail segment in this category is simmering in the true
sense – a 50% growth in 2007 as compared to 42.9% in 2006, and lot more
fireworks can be expected this year and the years ahead. Valued at Rs.9,000
crore, this organised market constitutes barely 1.1% of the total food &
grocery retail market.
The reason that we chose to study the Food and Beverages is that even
though it contributes to approx. 60% of the total retail industry, it contributes
merely 11% of the organized retail which shows the immense opportunity in
the particular segment.

B. Food Retail Industry in India
India‟s food retail market has grown more rapidly than any other in the Asia-
Pacific region during the 2004-2008 period. Despite deceleration forecast for
the 2008-2013 period, it should continue to perform strongly. The Indian
market generated total revenues of $263.7 billion in 2008, representing a
compound annual growth rate (CAGR) of 12.3% for the period spanning
2004-2008.
Convenience stores proved the most lucrative sales channel for the Indian
market in 2008, generating total revenues of $176.5 billion, equivalent to

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66.9% of the market's overall value. In comparison, sales through food and
drinks specialists generated revenues of $83.4 billion in 2008, equating to
31.6% of the market's aggregate revenues.
The performance of the market is forecast to decelerate, with an anticipated
CAGR of 8.3% for the five-year period 2008-2013, which is expected to drive
the market to a value of $392.4 billion by the end of 2013.

Convenience stores form the most important channel in the Indian food retail
market, accounting for 66.9% of the total value while the modern retail chains

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of supermarkets and hypermarkets command merely 1.1% of the total food
retail market in the country.
The food retail industry will be analyzed taking the retailers as players. The
key buyers will be taken as end-consumers, and food manufacturers, farmers,
and agricultural co-operatives as the key suppliers.
In India, food retail, particularly the hypermarket/supermarket sector, is less
developed than in Western economies. Some companies, including
conglomerates like Aditya Birla, are expanding rapidly in this competitive
space. Many small stores are independently run, often by families and without
technical or accounting standardization. The ratio of such retailers to
consumers is high, allowing the latter great freedom to move between at will,

strengthening buyer power.

a) Buyer Power: The sheer volume of potential customers in key areas of
the food retail industry diminishes the standing of any individual customer.
The revenue generated by any particular consumer is minimal and, in
itself, expendable. Yet insofar as they may represent a set of wider
interests across consumers, retailers cannot afford to disregard the
relevant sensitivities of buyers. Price and convenience are two central

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concerns however they are not necessarily the only factors. The response
of food retailers must accommodate many diverse interests. Whilst loyalty
towards a specific retailer is common at a small, local scale for various
personal reasons, larger retailers struggle to maintain a strong loyalty that
is not secondary to the need for a competitive pricing scheme, a perceived
quality of product range, or other defining feature. Although high brand
recognition does not automatically translate into consumer loyalty, if it is
supported by a product range in which popular food products are central,
the retailer can often draw indirectly on the loyalty base that certain food
manufacturers have established. With switching costs generally absent in
this area, however, a degree of independence remains for consumers and

other retailers may offer attractive alternatives. Buyer power, overall, is
moderate.
b) Supplier Power: Suppliers to the food retail industry include food
manufacturers, and farmers and agricultural co-operatives. In order to
ensure stability and offset the dangers of local sourcing problems or price
fluctuations, large retail companies often attempt to maintain relationships
with a wide range of suppliers. This diffuses dependency, minimizing the
risks to retailers, and strengthening their standing in relation to suppliers.
For this system however, the region must be able to support sufficient
supply chains, and the necessary infrastructure. This is not always the
case in the Indian market, which poses one of the key challenges to
retailers, restoring a degree of power to those who control the limited
supply routes in such cases. Long-term contractual obligations are
avoided where possible, however, and switching costs kept to a minimum.
With a firm hold on key distribution channels, the leading retailers can
dominate negotiations with certain suppliers. This is often impossible for
smaller retailers such as specialist or luxury outlets. The limited number of
suppliers in niche areas, and the centrality of product quality or preparation
type, limits the available range of sourcing options. With switching costs
subsequently higher, the balance of power shifts somewhat from smaller
retailers to specialist suppliers. Mainstream retailers evade this difficulty
due to the large number of suppliers. Frequently offering only limited
product differentiation – in the absence of strong branding – core products

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are replicated quickly and the pressure to undercut other suppliers
becomes significant. Whilst the need to satisfy consumer demand for
popular products bolsters the relevant manufacturers, many others face a
high degree of retailer mobility as they shift suppliers in accordance with
pricing pressures. Supplier power is no more than moderate.
c) Threat of new entrants: Large-scale, established retailers hold a natural
advantage in operating businesses that benefit significantly from
economies of scale, allowing aggressive pricing schemes that are not
viable for smaller retailers. Strong branding exercises and fast paced
expansion deepen this asymmetry. Nevertheless, they are not invulnerable
to the threat of new entrants. Exit and entry costs within the industry are

relatively low in regions that offer the relevant infrastructure, encouraging
potential entrants. Given the entrenched status of many large-scale
retailers, and the gradual emergence of heavier branding, direct head-to-
head competition is extremely difficult for new retailers. The fragmentation
of the industry does allow space for smaller retailers to flourish however,
sheltered within local niches, and strong market growth is attractive to
more ambitious entrants. For foreign players, government regulation has a
strong influence on ease of market access. India has tended to adopt a
protectionist stance in retail, with multi-brand retailing subject to caps on
foreign direct investment, while the single-brand retail sector, and also the
wholesale sector, more accessible to foreign investment. The threat from
new entrants is moderate.
d) Threat of substitutes: The chief alternative to food retail is food service.
Supported by strong marketing campaigns in the case of fast food
companies, and cultural traditions with respect to sit-down restaurants,
both types represent a relevant alternative for many consumers. However,
they do not constitute a complete substitute for reasons of cost, health and
more basic preferences. This alternative, for the vast majority of people,
accompanies food retail rather than replacing it completely. Another
substitute is found in subsistence agriculture in which individuals or
families farm food to provide for their own personal needs. Despite the
introduction of market capitalism it remains common in many rural areas
which are yet to be captured by the industry. Movement between the two

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systems is predominantly in the direction of food retail, however discontent
with the decline of traditional lifestyles and its associated values has
sparked the occasional exception. Nevertheless, the threat from
substitutes overall is weak.
e) Rivalry between existing players: Competition is often fierce within the
food retail industry. The lack of substantial switching costs for consumers
places pressure on retailers to secure their custom. The limited level of
differentiation across the basic product range pushes larger retailers into
competitive pricing policies. Price wars are frequent, intensified by the
increase in consumer awareness generated by „comparison sites‟. Whilst
some companies operate in other industries (for example, conglomerates

like Reliance Industries) and can absorb the temporary impact of declining
food sales, or high supply prices, for many, food retail lies at the heart of
the business. This basic dependency gives rise to aggressive competition,
assessed as moderate overall.

MAJOR FOOD & GROCERY RETAIL CHAINS
A. Foodworld: Foodworld Supermarkets Ltd. chain of stores operates over 67
supermarket stores across Bangalore, Chennai and Hyderabad with a store
size of 3,000 to 5,000 sq. ft. The retail chain currently operates 4 formats –
Supermarket, Superstore, Express store and Gourmet store covering F&G
vertical and plans to expand its footprint to upto 200 stores in the country with
formats covering hypermarkets, supermarkets, express stores and concept
sales by 2009-10.
B. Spar: Founded in 1973, Landmark Group is one of the largest retail
conglomerates in the Middle East and entered India in 1998. The group
forayed into the hypermarket business with the opening of Spar hypermarkets
in India by tying up with the Dutch retail giant Spar International. Spar rolled
out its 1st hypermarket in India, spread across 75,000 sq. ft. in Bangalore in
September 2007, followed by a 2nd - a supermarket format expanding across
30,000 sq. ft. in January 2008. Spar plans to open 7 stores by the end of 2009.
C. Food Bazaar: Flagged off in 1982, Pantaloon retail owned Food Bazaar is
today a 138 strong chain of large supermarkets where the western values of
convenience, cleanliness and hygiene are offered alongwith the Indian values

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of “see-touch-feel”, all at very economical and affordable prices without any
compromise on quality. Till March 2008, Food Bazaar operated 46 standalone
outlets.

The summary of the network of the 3 above-mentioned modern format stores is as
given below:

Retail Retail
Retail space
Name outlets presence
(in sq. ft.)
(2008-09) (2008-09)
Food Bazaar 138 N.A. 31,05,000
Spar – Hypermarket 1 1 75,000

Spar - Supermarket 1 1 30,000
Foodworld - Supermarket 67 N.A. 2,68,000

CONSUMER FEEDBACK
In order to understand the preferences of consumers living close to Bannerghatta
Road, Bangalore, we had conducted a survey. As mentioned earlier, through the
survey we tried to collate the following information about consumers:

A. Demographic information
B. Buying Behaviour
C. Purchase preference
D. Feedback about their “preferred store”

The collated information is as below:

A. Demographics: Our study shows that the majority of the consumer
housewives are of the age group of 26-35 years. The spread of household
income is quite diverse and spread out. Majority of the families are nuclear
families with total members in the range of 3-5 only. This clearly shows that
relatively young consumers with reasonably good disposable incomes live
with small family in the city. This will further have an implication on the
consumer preferences and the spending on food by each household.

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Age (yrs) Income (Rs. monthly)
46-55, 6%
>55, 0%
<25, 18% <25000, 35
36-45, 18% >75000, 41
<25 %
% <25000
26-35
25000-50000
36-45
26-35, 59% 50000-75000
46-55
>75000
>55 25000-
50000-
75000, 6% 50000, 18
%

Family Size

>5, 0% <3, 12%

<3
3-5
3-5, 88%
>5

B. Buying Behaviour: As per our survey findings, most of the consumers
purchase food items once in a week from the supermarkets and stores and
the average spend during each purchase visit is less than Rs.1,000. As per
consumers, their prime reason for purchase is quality followed by
convenience and variety. Hence, almost 50% consumers are willing to travel
2-5 kms in order to get quality food for the household.
Though the nearby “kirana” store is the most preferred by consumers but
many consumers have expressed that they visit multiple stores depending on
the requirements. For small purchases for immediate requirements, they
prefer the kirana store but for weekly bulk purchases they prefer to visit a
modern supermarket.
Spar is the most preferred place for shopping food items followed by Star
Bazaar. Customers seem to prefer hypermarket over supermarkets for their
regular purchase of food items. It may be due to the better variety and
assortment that is available. As we have already seen that consumers equally
prefer convenience and variety. Hence, keeping basic quality as given,

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consumers are willing to sacrifice one over the other depending on the
requirement.

Frequency of purchase from supermarket Avg Spend (Rs. per purchase)

Almost 1000-
Thrice a Daily, 12% 2000, 18% >2000, 0%
week, 0% <500, 29%
Once a week <500
Twice a week 500-1000
Thrice a week 1000-2000
Twice a
week, 18% Almost Daily >2000

Once a 500-
week, 71% 1000, 53%

Distance (in kms) of preferred store

5-10, 18%

0-2, 35%
0-2
2-5
2-5, 47%
5-10

Preferred Store
47%
50%

40% 35%

30% 24%
18%
20%
12% 12%
10%
0%
0%
Kirana Food More Spar Big Reliance Star
store World Bazzar Bazaar

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Reasons for purchase from preferred
store
80%
60%
40%
20%
0%

C. Purchase Preference: As per our survey, the primary concern of
consumers when choosing a supermarket to shop are the availability of food
products and the proximity of the store i.e. convenience factor. Though
consumers want good assortment of food products, but the convenience
factor tends to overrule the store loyalty. However, when shopping at
supermarket, consumers also give a higher priority to price and availability of
household products and cosmetics apart from just food items. Hence, if a
standalone food store wants to gain a higher customer base then it must keep
in mind the convenience factor as it will not qualify higher on customer‟s
priority over other stores on the remaining top 5 parameters.
Similarly, as consumers tend to place a reasonable weightage to price, it
implies that similar size stores of same format in the same location will not be
able to survive as consumers will value price as a differentiating factor leading
to intense price rivalry which will be detrimental for both the stores.
As consumers are quite price sensitive when shopping at supermarkets and
as most of the products are standardized, hence consumers don‟t place a
higher weightage to the service rendered at the store which is reflected by the
parameter on courteous and friendly employees. Hence, customers are willing
to shop on their own provided they get the price advantage at the
supermarket.

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Consumer Priority when shopping at Supermarket
Avg.
S.No. Parameter
Rating
1 Availability of food products 12.4
2 Close to where you live 12.2
Availability of personal care products like
3 10.8
cream, toothpaste, brush
4 Price lower than the printed MRP 10.4
Availability of household products like
5 10.1
plastics, mosquito repellent, detergent
6 Convenience of parking 9.5
7 Fast billing system/ less waiting 9.2
Extended store operating hours – 8 am to
8 9.1
10 pm
9 Accepts credit card 8.6

10 Special promotion schemes 6.8
11 Courteous, friendly employees 6.6
Availability of snacks/ fast food joint outside
12 3.9
the supermarket
13 Availability of fresh meat 2.8
14 Availability of magazines 2.1
15 Availability of alcoholic beverages 0.3

From the chart on the items frequently purchased by consumers at the
supermarket, we can see that consumers primarily purchase household items,
cosmetics, oils, grains and pulses at supermarkets. Items with relatively
shorter shelf life and hence more frequent purchase items like milk, eggs,
vegetables, fruits are still not purchased by majority of consumers from
supermarkets. The reason is that consumers purchase once a week from
supermarkets and in such shorter shelf life items, the quality and freshness is
a concern. Hence, these items are either procured from the nearest “kirana”
store or from the nearby “small vendors” at a higher frequency in a week. This
was also evident from the fact that consumers rate the proximity almost equal
to food products availability.

Hence, in order to improve the sales of perishable food items like milk, fruits,
vegetables, supermarkets will have to devise a system of daily delivery by
taking orders over phone and delivering at home. As per the graph below, the
consumer‟s purchase preference for an item from supermarket is proportional
to the shelf life of most of the items. Lower the shelf life, lower is the chance
that the item will be purchased regularly from the supermarket.

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Items frequently purchased from supermarket

Toileteries/ Cosmetics
Household Items
Cooking Oil/ Spices
Wheat/Rice Flour
Grains and Pulses
Snacks
Bakery Items
Soft Drinks/Juices
Fruits
Frozen Foods
Vegetables
Milk Prods
Eggs
Ice Creams

Baby Cosmetics & Food
Fresh Meat
Milk
Magazines

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

As per a recent study made by the Retailers Association of India, the factors that
shoppers consider as important for deciding where to shop are:

 Always have what I want
 Attractive and interesting promotions
 Efficient check-out counters
 Good value for money
 Provide home delivery
 Wide product range/ variety

STORE AUDIT FINDINGS
As a part of our project, we physically visited the 3 stores. Below are our
observations of the distinct features of each of the stores (only food and grocery
section) and a comparison amongst them.

A. Foodw orld – Bannerghatta Road
Capacity of car parking area: ~ 12 cars
Fees for parking: Free
Area: 5,000 sq. ft. (approx.)
Unique aspects seen (see Exhibit-03 also):

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1. This is a Supermarket format.
2. Liquor and Fresh Meat also available.
3. Small “Chat” shop outside the store.
4. Even pirated CDs sold outside the store.
5. Promise of “Lowest Price in town” displayed prominently near billing
counters to reinforce customer‟s decision to purchase.
6. Grains, pulses and spices sold mostly as store brand under 2 varieties –
Regular and Premium.

B. Big Bazaar – Ja yanagar 9 t h block

Fees for parking: Free
Area: 8,000 sq. ft. (approx.) only Food and Grocery section
1. Many products discounted and sold by bundling with other products –
combo offers.
2. Pickles sold loose.
3. Fresh idli and dosa batter available alongwith coconut chutney.
4. Grains and pulses available loose.
5. Impulse purchase items and cheap items stocked near the billing counters.
6. Many promotional schemes on purchase like 2 kg sugar free with Rs.1,000
worth of purchase.
7. Products stored in aisles and overall movement is congested.
8. Packet milk and eggs are not available.
9. Even breads which are kept are of the basic type. Not much variety
available.
10. Express checkout counters for consumers with less than 5 items.

C. Spar – Near Sagar Apollo Hospital
Fees for parking: Rs.10 per hour
Area: 25,000 sq. ft. (approx.) only Food and Grocery section
1. This is a Hypermarket format.

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2. Separate bakery, sweets, juice, pickles and milk products (curd & cheese)
counter within store.
3. Grains and pulses available loose.
4. Wide variety of fresh meat.
5. Exotic and foreign brands of food products also available.
6. Wide aisles for easy movement of trolley.
7. Fresh ground coffee also available.
8. Store brands for grains, pulses and spices available in 3 slabs – Premium
brand: Select; Mid-range brand: Value and Economy brand: Best Price.
9. EDLP on select items.
10. Low price display with item alongwith valid time period.

11. Reasonably sized food-court outside the store.
12. Express checkout counters for senior citizens, pregnant women and
consumers with less than 10 items.

D. Comparison
The comparison has been done by taking a particular parameter and bringing
all stores‟ products on a comparable platform. Hence, while interpreting the
graphs, we must be careful only to compare the same product amongst
different stores and not to compare different products across different or even
the same stores as the scales have been rationalized for easy interpretation of
data.

The comparison has been done on 6 parameters:

a. Assortment
b. Range of pack sizes
c. Cheapest brand
d. Costliest brand
e. Aggressiveness towards “Store Brand”
f. Space dedicated for each item

a. Assortment
1. Dairy & Poultry products: Spar has the highest assortment and Big
Bazaar the lowest. For milk, Spar even keeps the packet milk while others
don‟t. Similarly they have a separate counter for curd and juices.

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30
25
20
15
10
5
0

Spar

Spar

Spar

Spar

Spar

Spar
Foodworld
Foodworld

Foodworld

Foodworld

Foodworld

Foodworld
Big Bazaar

Big Bazaar

Big Bazaar

Big Bazaar

Big Bazaar
Big Bazaar
Milk Curd Butter Cheese Eggs Ghee

2. Fruits & Vegetables: For fruits, Spar has the higher assortment while for

vegetables, which we have chosen, Foodworld has the higher assortment.
However, the variety of fruits and vegetables is higher at Spar than the
other two, while Foodworld has the least variety.

5
4
3
2
1
0
Spar

Spar

Spar

Spar

Spar
Foodworld

Foodworld

Foodworld

Foodworld

Foodworld
Big Bazaar

Big Bazaar

Big Bazaar

Big Bazaar

Big Bazaar

Banana Apple Onion Potato Tomato

3. Grains, Pulses & Edible oil: Overall Spar has the higher variety while Big
Bazaar has the lower. Spar keeps both store brands and popular brands
and hence serves a broader range of consumers.

14
12
10
8
6
4
2
0
Spar
Spar

Spar

Spar

Spar

Spar

Spar

Spar
Foodworld
Foodworld

Foodworld

Foodworld

Foodworld

Foodworld

Foodworld

Foodworld
Big Bazaar

Big Bazaar

Big Bazaar

Big Bazaar

Big Bazaar

Big Bazaar

Big Bazaar

Big Bazaar

Sona Idli Rice Basmati Moong Dal Tur Dal Chana Dal Wheat Sunflower
Masoori Rice Flour Oil
Rice

22

Retail Strategy - Food & Beverages: Store strategies of major modern stores & Preferences of Bangalore consumers

Retail Strategy - Food & Beverages: Store strategies of major modern stores & Preferences of Bangalore consumers

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