retail management

1. UNIT - 1
Retail Management
A processof promotinggreatersalesandcustomersatisfactionbygainingabetterunderstandingof the
consumersof goodsand servicesproducedbyacompany.
“Retailing includesall the activitiesinvolvedinsellinggoodsorservicestothe final consumes,for
personal,non-businessuse.A retailerorretail store isany businessenterprisewholesalesvolume
comesprimarilyfrom retailing” - Philipkotler
Functions of Retailing
• Sorting
• BreakingBulk
• HoldingStock
• Additional Services
• Channel of Communication
• Transportation
Sorting - The itemsare arrangedinorder bythe retailerssothat the customersare able to locate and
pickup theirneededgoods easily
Breaking Bulk - Breakingbulkisanotherfunctionperformedbyretailing.The wordretailingisderived
fromthe Frenchwordretailer,meaning‘tocuta piece off’
To reduce transportationcosts,manufacturersandwholesalerstypicallyshiplarge cartonsof
the product,whichare thentailoredbythe retailersintosmallerquantitiestomeetindividual
consumptionneeds
Holdingstock - The retailerholdsstocksof goodsandtherebymeetsthe day-to-dayneedsof the
consumer
Additional services - Retailersease the change inownershipof merchandise byprovidingservicesthat
make it convenienttobuyand use products.Providingproductguarantees,after-salesservice and
dealingwithconsumercomplaintsare some of the servicesthataddvalue tothe actual productat the
retailers’end
Channelsof communication - Retailersalsoact as the channel of communicationandinformation
betweenthe wholesalersorsuppliersandthe consumers.Fromadvertisements,salespeopleand
display,shopperslearnaboutthe characteristicsandfeaturesof aproductor servicesoffered.

2. Manufacturers,intheirturn,learnof salesforecasts,deliverydelays,andcustomercomplaints.The
manufacturercan thenmodifydefective orunsatisfactorymerchandise andservices
Transportation - Nowadays,small grocerystoresare undertakingthe workof doordeliverordersin
case of durable goods
Characteristics of Retailing
• Directenduserinteraction
• Salesare in smallerunitsize butonfrequentbasis
• Locationis a critical factor
• Servicesare as importantascore products
RETAIL TRENDS
1. Retailers will give consumers more payment options.
2. Mobile will play a bigger role in click-and-collect initiatives.
3. Retailers will unify their online and offline data collection.
4. Retailers will continue to remove friction from shopping.
5. Merchants will adopt in-store mobile devices
6. Old school loyalty programs are on their way out.
7. Retail pure-plays will disappear.
8. More retailers will opt for single-view and cloud-based solutions.
9. Retailers will invest in omnichannel fraud management.
10. Social will grow as part of the omnichannel mix.
11. Stocking up on more merchandise won’t cut it anymore.
12. More retailers will look into the Internet of Things to enhance the shopping experience.
KEY DRIVERS OF THE INDIAN RETAIL INDUSTRY
 Growth of middle classconsumers
 Increase inthe numberof workingwomen
 Emergence of nuclearfamilies
 Value formoney

3.  Technological impact
 Rise inincome
 Mediaexplosion
CHALLENGES FACED BY RETAIL INDUSTRY
• International standard
• Inefficient supply chain management
• Lack of retail space
• Real estate issues
• Human resource problems
• Frauds in retail
• Challenges with infrastructure and logistics

4. UNIT - 2
ORGANIZED RETAIL STORES
The Organizedretailing referstothe tradingactivitiesundertakenbylicensedretailersthatis
those whoregisteredthemselvesforsalestax ,income tax ,etc…
example :PantaloonRetail (India)Ltd,Reliance Fresh,Shopper’sStopLtd
UNORGANIZED RETAIL STORES
It consistsof unauthorizedsmall shops - conventional Kiranashops,general stores,cornershopsamong
variousothersmall retail outlets - butremainasthe radiatingforce of Indianretail industry.
DIFFERENTORGANIZED RETAIL FORMATS
Types
 Supermarket
 Departmental store
 Hypermarket
 Convenientstore
 Specialtystore
 Categorykillers
SUPER MARKET
A supermarket,alarge formof the traditional grocerystore,isaself-serviceshop offeringawide variety
of foodandhouseholdproducts,organizedinto aisles.Itislargerandhas a widerselectionthana
traditional grocerystore,butissmallerandmore limitedinthe range of merchandise than
a hypermarketorbig-box market.
CHARACTERISTICS
 Theyfunctiononcash-and-carrylinesandoffernocredit.
 There are nosellingcountersorsellingassistantstohelpthe customers.
 Theystock a verywide range of foodand non-foodproducts,particularlymeatproducts,dairy
products,tinnedfood, vegetablesandotherhouseholdproducts
 The products storedin a supermarketare properlypackedandplacedonseparate racks in
orderto facilitate purchasingbythe buyer.
 Theyuse mass displaysof goods,have low pricesandoperate onself-service basis
DEPARTMENTAL STORE

5. “A departmental store isalarge retailingbusinessunitwhichhandlesawide varietyof shoppingand
specialtygoodsandisorganisedintoseparate departmentforpurposesof promotion,service,and
control.”
CHARACTERISTICS
 There are variousdepartmentsoperatingunderone roof andeach departmentspecialisesin
particulartype of trade.
 All the departmentsoperate underthe centralisedcontrol andmanagement.
 Theiroperational expensesare veryhigh.
 Theyare usuallysituatedatthe mostcrowdedplace andat an importantplace of the city.
 The departmental store offerexcellentservicestotheircustomersviz.;freehome deliveryand
replacementof disapprovedgoodsetc.
HYPER MARKET
Hypermarketisa superstore combiningasupermarketandadepartmentstore.The resultisanexpansive
retail facilitycarryingawide range of productsunderone roof,includingfull groceries linesandgeneral
merchandise.Intheory,hypermarketsallow customerstosatisfyall theirroutineshoppingneedsinone
trip.
CHARACTERISTICS
 Retail businessmodel &type of Service supported
 Supportsall typesof POSaccessories
 InventoryTypes
 Reorder& Replenishment
 Loyalty& Promotions
CONVENIENTSTORE
A Convenience store isaretail store that carriesa limitedselectionof basicitems,aspackaged foods
and drugstore items,andisopenlonghoursforthe convenience of shoppers.
CHARACTERISTICS
 EfficientSupplyChain
 Distinct& CompellingConsumerValueProposition
 Aggressive Market-BasedInvestment
 Low Fuel MarginNeed
 DeliciousFreshFood
SPECIALTY STORES
A small retail outletthatfocusesonsellingaparticularproductrange and associateditems.Most
specialtystore businessoperatorswill maintainconsiderabledepthinthe type of productthatthey

6. specialize inselling,usuallyatpremiumprices,inadditiontoprovidinghigherservicequalityandexpert
guidance toshoppers.
CHARACTERISTICS
 SpecializationandExpertise
 Lack of Variety
 Staffing
 Reliance onMarket
CATEGORY KILLERS
A large retail chainstore that isdominantinitsproductcategory.This type of store generallyoffersan
extensive selectionof merchandise atpricessolow thatsmallerstorescannotcompete.
CHARACTERISTICS
 Deepselections
 Efficientmerchandise arrangements
 Use of technology
 Fixedprices
 Volume sales

7. EMERGING TRENDS IN RETAIL FORMATS
1. Emergence of Wholesale Clubs
2. Increasing Acceptance of Rural Markets
3. Govt. is also promoting the Development of Modern Retail Formats
4. Efficient Buying: Increasing Importance of Supermarkets & Discount Stores
5. Hypermarkets: The Biggest Crowd Puller
6. Customers still rely on traditional concepts
7. Emergence of Private-Label Brands
8. Ease of Shopping & Customized Services
9. Magnetic Effect: Discounters not Shopkeepers
10. Category Killer: A New Concept imported from U.S
11. e-Retailing

8. MNC's role inorganizedretail formats
MNC - An enterprise operating in several countries but managed from one (home) country.
FEATURES OF MNC
• Big size
• Huge intellectual capital
• Operates in many countries
• Large number of customer
• Large number of competitors
• Structured way of decision making
IMPACT ON INDIA
• Large amount of tax collections through MNC’s
• Increased revenue
• Economic health improved
• Employment increased
• Foreign relation increased
MERITS
 Increase in investment level
 Transferring the technology
 It increase host company export than
import
 Integrating national economy
 Implementing new innovations
DEMIRITS
 May acquire monopoly power
 Underestimate local culture
 Think about profit rather than the host
country interest
 Inflexibility in terms and conditions
 Heavy use of non-renewable natural
resources
ROLES OF MNC IN INDIA
• Profit maximization
• International network of marketing
• Diversification policy

9. • Concentration in consumer goods
• MNC’s & Process of planned economic development in india
• Cultural explosion
Reasons for Growth of MNCs in Retailing
 Factor mobility
 Economic reforms
 Management culture
 Growth urge
 Market potential
 Risk minimizing
 Developing in communication technology
Amazon’s Model
current organisational structure
PRIMARY DRIVERS
Product focus
Customer focus
Technology focus
Distribution focus

10. INBOUND DOCK
Stock is unpacked and placed in the conveyor belt for checking.
Checking takes place at 6 points including computerized checking.
A unique bar code is given and placed in the storage randomly.
PICKING PRODUCTS
After the order is placed the list of products are collected.
The location of the product is easily identified from the system.
The products are scanned and placed in orange boxes
PACKAGING
The products are scanned and marked by size.
They are linked up with a specific shape of amazon packaging.
The boxes placed in the conveyor belt for labeling for shipping which takes place
through several means such as prime air.
WHY AMAZON ?
Fulfillment centers
Credit cards on file
Betty bots
Prime air
Cross selling
Personalize the Shopping Experience
virtual marketing
Virtual marketingisadvertisingthroughthe internetand otherformsof advertisingsuchasRadio,
Television,Magazines,etc.Itislessexpensive,andwe canreach a more numberof people...
Virtual marketingisthe basisof searchenginespositioning,rankingandoptimization,website
indexation,banneradvertising,e-mailmarketing,contentdevelopment,social mediamarketing,
researchand manymore

11. UNIT - 3
Understanding Customer
Shopping Behavior
Buying Behavior is the decision processes and acts of people involved in buying and using
products.
Consumer Buying Behavior refers to the buying behavior of the ultimate consumer. A firm needs
to analyze buying behavior for:
 Buyers reactions to a firms marketing strategy has a great impact on the firms success.
 The marketing concept stresses that a firm should create a Marketing Mix (MM) that
satisfies (gives utility to) customers, therefore need to analyze the what, where, when and
how consumers buy.
 Marketers can better predict how consumers will respond to marketing strategies.
Stages of the Consumer Buying Process /shopping process
 Problem Recognition
 Information search
 Evaluation of Alternatives
 Purchase decision
 Purchase
 Post-Purchase Evaluation
Factors influencing the consumer decisionmaking/shopping behaviour
Range of merchandise
Convenience of shopping at a particular outlet
Time to travel
Socio economic factor
The stage of the family lifecycle
Profile of Indian Shoppers
 Segments of Men: profile of Indian men has shown four broad groups.
1. The traditional Men is conservative, driven by values, cherishes by family and avoids
ostentation.
2. The Pleasure seeker is a self oriented person driven by status and status symbols. He is
risk taker and pleasure seeker.

12. 3. The social chameleon is a hypocrite of sorts who wants to project the right image. Tech
savvy and individualistic.
4. The intrinsic progressive man is futuristic person. He believes in family values and
equality of sexes.
 Segments of Women: Indian women in following manner.
1. The contented conservative is a housewife who is happy with her state of her life
/society.
2. The anxious rebel is a working women who is happy with the existing state of affairs.
3. The troubled homebody is housewife who is not sure that she is doing the right thing by
sitting at home.
4. The tight-fisted traditionalist is traditional women who believes in saving for tomorrow
5. The affluent sophisticate is an affluent women who is comfortable with the finer things
in life
6. The contemporary housewife is a housewife who plays active role in the household and
sees herself as equal to her husband.
7. The Gracious hedonist is a working women who believes in looking after herself well
 Youth segments:
1. Homebodies: they are largely traditional , have low individuality and very few
aspirations for self and keep duty and morality at the core of their value .
2. Two faced youths : they are inwardly traditional and outwardly modern.
3. Wannabes: this is large cluster. They are materialistic show offs they are extremely
competitive. they are desperately to be a part a crowd , and trend followers, aggressive
seek out lifestyles.
4. Rebels: this is the largest cluster. They may be first generation educated professionals ,
experiencing winds of change in the form of education as the means to a career, wealth
,change in lifestyles and independence.
5. Cool guys: they are the influences . Others want to be like them. They fall in the “work
hard play harder”. They are confident and have a strong sense of individuality.
Retail market segmentation
 It may be defined as a process of splitting or dividing potential customers into certain
groups or segments sharing similar levels of needs.
 It is creating sub-sets of a market based on similar characteristics of consumers with
similar demands and providing them with a product to satisfy their need.
Benefits of Market Segmentation
Identifies opportunities for new product development

13. Helps design marketing programs most effective for reaching homogenous groups of
buyers
Improves allocation of marketing resources
The need for marketing segmentation
 The marketing concept calls for understanding customer and satisfying there needs
better than the competition.
 Different customers have different needs, and its rarely possible to satisfy all the
customers by treating them alike.
IMPORTANCE
 Find a market with limited competition
 Select the most profitable segment
 The Organisation gets to know its customers better.
 Provides guidelines for resource allocation.
 It helps focus the strategy of the organisation.
 It reduce the risk in deciding where, when, how, and to whom a product, service, or
brand will be marketed.
LEVELS OF SEGMENTATION
Mass Marketing - Same product to all consumers (no segmentation)
Segment Marketing - Different products to one or more segments (some segmentation)
Niche Marketing - Different products to subgroups within segments ( more
segmentation)
Micromarketing - Products to suit the tastes of individuals or locations (complete
segmentation)
PROCEDUREOF SEGMENTATION
 Identify the target market
 Identify expectations of Target Audience
 Create Subgroups
 Review the needs of the target audience
 Name your market Segment
 Marketing Strategies
 Review the behavior
 Size of the Target Market

14. TYPES OF SEGMENTATION
Retail Market Target andPositioning
TARGET MARKET
After having divided the market into various segments, the retailer now needs to decide on
whom he is going to cater to. The consumer segment that he decides to cater is called Target
Market
While selecting the Target Market one needs to look at the following ability of the retail
organization,
 needs of the Segment,
 size,
 future growth potential of the segment
 the kind of investment that would be required
 the kind of profits that could be earned
Positioning is the act of designing the company’s offering and image to occupy a distinctive
place in the target market’s mind.
Positioning starts with a
 Product
 Piece of merchandise
 Service
 Company

15.  Institution or
 Even a person
Four Main areas which affect the retail positioning strategy
 Merchandising strategy
 Trading Style or format strategy
 Customer service strategy
 Customer communication strategy
Bases and Strategies for Positioning
 Product or service attribute
 Technology positioning
 Benefit positioning
 User category
 Competitor positioning
 Integrator positioning
 Positioning of leader
 Positioning of follower
 Re positioning
 De positioning
UNIT - 4
Setting up of Retail Business & Management Aspects
Factors influencing RetailMarket Location
Retail Location- A space you lease for the selling of goods to consumers . When it comes to
business, retailers have one overall goal: to sell merchandise. That's why they focus on sales
floor space, adequate parking for customers, and an overall image that draws in customers.
Main Factors for Retail Location
• Target audience
• Kind of merchandise
Types
1. Freestanding or Isolated Store
2. Part of business district
i. Central Business District(CBD)

16. ii. Secondary Business District (SBD)
iii. Neighborhood Business District
3. Part of shopping center
Steps Involved in choosing Retail Location
1.Market Identification
2.Determining the Market Potential
 Demographic features of the population
 Characteristics of the households in the area
 Competition and compatibility
 Laws and Regulations
 Trade area analysis
3.Identify alternate sites and
4.Select the site
Factors influencing Retail Market Location
Building space
Workforce
Accesstomarkets
Businessenvironment
Businessformation andacceleration
Qualityoflife
Site Evaluation
When evaluating and selecting a specific site, retailers consider:
• The characteristic of the site
• The characteristic of the trading area
• The estimated potential sales that can be generated
Site Evaluation Methods
 The Herfindahl-Herschman Index
 The Index of Retail saturation
 Reilly’s Law of Retail Gravitation
 Central Place Theory – Huff’s Model of Trading Area Analysis

17. Store Layout and Decisions
Store layout is the design of a store’s floor space and the placement of items within that store.
store layout helps influence a customers behavior, which means when done right, it’s a key
strategy to a stores prosperity
Types of store layout
 Grid
 Racetrack
 Freeform
 Herringbone
Grid layout
Traditional form of store layout is grid layout, in which the counters and fixtures are placed
in long rows or runs, usually at right angles, throughout the stores.
The grid is a true shopping layout, best used in retail environment in which the majority of
customers wish to shop the entire store.
Ex: super market, drug stores.
Race Track Layout
It provides a major aisle that loops around the store to guide customer traffic around
various department.
To direct customers to the stores, aisles must be defined by change in surface or colour.
Ex: departmental store such as shoppers stop.
Free-Flow Layout
Fixtures and merchandise grouped into free flowing patterns on the sales floor-no defines
traffic pattern.
Ex: Specialized stores.
Herringbone Layout
It is used for a narrow store of maximum 40 feet width where the highway is a single two
way one, bisecting the the store along its length with side roads leading to the walls from it.
Example : music world,toys shop.
FACTORS AFFECTING STORE LAYOUT
1. Total space available
2. Types of product offered by the store
3. Number of department in the store

18. 4. Volume and variety ratio in the product line carried
5. Movement required in the store locating, picking, storing the product
6. Target customers and average number of customers visiting the store
7. Degree of change in operation
RETAIL IMAGE
The total conceptualized or expected reinforcement that a person associates with shopping
at a particular store -- Kunkel & Berry
A retailer's image depends heavily on the atmosphere (atmospherics) projected. For a
store-based retailer, atmosphere is defined as the physical attributes of the store utilized to
develop an image; it is composed of the exterior, general interior, store layout, and displays
Store Image contribution
• Price of the merchandise
• Quality of the merchandise
• Assortment of merchandise
• Fashion of merchandise
• Sales personnel
• Location convenience
• Other convenience factors
• Services
• Sales promotions
• Advertising
• Store atmosphere
• Reputation
Factors affecting the retail image
Two Types
• Primary factor
• Complimentary factors
Primary factors of Retail Image
• The product itself / the merchandising features
• The place where it is sold or the location of the store
• The pricing of the product
• The manner in which it is presented to the customers

19. • The advertising and promotion for the store
Complimentary factors of Retail Image
• The shopping experience provided in the store
• Customer service
• The sales staff
• Brand association
Visual Merchandising andAtmospherics
Visual Merchandising is the art of displaying merchandise in a manner that is appealing to
the eyes of the customer.
Visual Merchandising is the activity of promoting the sale of goods, especially by their
presentation in retail outlets.
ATMOSPHERICS
 The design of an environment via:
• lighting
• color
• sound
• scent
 To stimulate customers’ perceptual and emotional responses and ultimately influence
their purchase behavior
 Sound
• Music viewed as valuable marketing tool
• Often customized to customer demographics

20. • Can use volume and tempo for crowd control
 Scent
• Smell has a large impact on our emotionss
• Can be administered through time release atomizers or via fragrance-
soaked pellets placed on light fixtures
Managing Retail Personnel
Personnel management can be defined as obtaining, using and maintaining a satisfied
workforce. It is a significant part of management concerned with employees at work and with
their relationship within the organization
Retailing is all about Managing personnel well so that profitability and customer satisfaction
remains
HR Issues
 Manpower Planning
 Recruitment
 Motivation & Retention
Retail management informationsystem
A retail management system(RMS), also known as retail management software, is
essentially an integrated set of computerized applications that the retailer uses to operate
their business.
Retail Management Information Systems include using hardware, software and procedures to
manage activities like planning, inventory control, financial management, logistics and point of
sale transactions.
Characteristics
 support distributed stores by linking them
 allow instant information exchange between stores and management.
 handle the various aspect of product management.
 handle customer analysis.
 allow the store manager flexible pricing over a period.
 involve the use of a mobile user interface.
Retail management systems typically include
 Point of Sale (POS),

21.  Customer Relationship Management (CRM),
 Sales Order Management,
 Inventory Management,
 Purchasing & Receiving,
 Reporting and data driven Dashboard applications.
 Some offer e-commerce applications as part of their suite.
Benefits Of Retail Management Information Systems
 Operations are improved
 costs are reduced by preventing duplicate entries.
 By effectively tracking inventory, customer requests can be dealt with faster.
 With expedient responses you can also improve service, expand your customer base and
increase profits.
 Easy access to data allows you to identify various opportunities.
 strategies pave the way for profitable business. With systemsafeguards adherence to
legal restrictions on pricing, promotion and other policies are ensured.
UNIT - 5
Recent Trends in Retail Market
Challenges in Retailing in India
• International standard
• Inefficient supply chain management
• Lack of retail space
• Real estate issues
• Human resource problems
• Frauds in retail
• Challenges with infrastructure and logistics
CRM in Retailing
Customer Relationship Management (CRM) is: the integration of sales, marketing, service and
support strategy, process, people and technology to maximize customer acquisition, value,
relationships, retention and loyalty.

22. The CRM Process
CRM is an iterative process that turns customer data into customer loyalty through four
activities:
1. Collecting customer data
2. Analyzing the customer data and identifying target customers
3. Developing CRMprograms
4. Implementing CRMprograms
CRM Cycle
Advantages
• Increase relationship with clients
• Increase of sales
• Better communication channels
• Create detailed profile
• New selling opportunities
• Provide better customer service
Disadvantages
• Small companies- not possible
• Requires continuous maintenance,
updating of information
• Difficult to integrate with other MIS
• Training cost increase
International Retailing
All the activities involved in selling products and services to final international consumers
for their personal consumption.”

23. Retail internationalization is the management of retail operations in market which are different
from other in their regulation, economic development, social conditions, cultural environment
and retail structures
Factors Affecting International Retailing
• Expansion of Retail Operations To Foreign Market.
• Transfer Of Retail Concepts.
• Internationalization Of Management Expertise
• Employing Advance Technology.
Issues In International Retailing
• Legislation & Regulation
• Taxation & Cross Border Shopping
• Variations In Retail Practices (Consumers Perspective)
• Variations In Retail Practices (Sales people And Management)
Indian Vs. Global Retailing
Indian Retailing Global Retailing
A) Retailing Is mostly unorganized. A) Mostly Organized Retailing.
B) It is concentrated around few formats. B) Large number of retail formats .
C) Lag behind in use of technology. C) Advanced technology applications.
D) Infrastructural Bottlenecks. D) Minimum infrastructural problems.
E) Low competition market. E) Cut-throat competition exists.
F) Lack of trained Manpower. F) Trained manpower aids retail boom.
MIS inRetailing
A managementinformationsystem(MIS) isasetof systemsandproceduresthatgatherinformation
froma range of sources,compile itandpresentitina readable format.
HRM in Retailing
FDI inRetailing
Complaints Management SysteminRetailing

24. A CMS is a staged way of receiving, recording, resolving, responding to and reporting on
complaints.
Complaint Management System is a system that can survey customer feedback about any
organization. Best-practice organizations consider complaints as opportunities for
improvement.
These companies understand the link between complaint resolution and customer loyalty and
work hard to act immediately on problems that can be easily resolved.
A ComplaintManagementSystem isone of latestproductivityenhancementtoolsusedwidelybyall
organisations whereverthere isaneedof bookingof complaints viaoperators andanalysisof complaints
whichare made or are pending.
An effective CMS should:
 Provide a simple and clear process (to staff and public), fair and timely complaint
outcomes and information to help improve service delivery.
 Include written policy and procedures, a complaints recording and reporting system and
other resources including trained staff and website.
 Meet recognised standard and principles of good complaints management practice.
Consumer complaints management takes many forms,
 from preventive to internal complaints-handling,
 external dispute resolution and
 comprehensive approaches.