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Term paper

Of
Retail management

Topic: - retail bookstore

Submitted to: - Submitted


by: -
Mr. Pratish srivastav mohd fahad
Section: -
1803
Roll no. –
a14
Reg. no.
-10809577
Diamond bookstore
Diamond Bookstore will be a general partnership type of
business. The shop will be jointly owned by Mohd Fahad, Mohd
Umar and Mohd Shabi. Diamond Bookstore will be establishing
its shop in city towers main university road Delhi. This area is
well known for every sort of shopping. Our facility is a 5,500
square ft. shop which allows us to stock a large amount of
inventory.

Our start-up expenses come to Rs 25 million, which are single


time fees associated with opening the shop. These costs are
financed by a bank loan and our investment as well.

We have divided the market into three segments of potential


customers. They include casual shoppers, hard to find shoppers
and specific category shoppers.

We will provide our customers a relaxed atmosphere for


reading the books by the arrangement of comfortable chairs
and tables.

We will be having a buyback program to lower inventory


acquisition costs and allow the customers to discard unwanted
literature and music.

Diamond Bookstore will offer a wide range of every kind of


books and music CD’s and DVS’s on low prices. Our main
competitors are Odyssey and Higginbotham and also local
bookshops.

Our competitive edge will be the lower prices we will charge


our customers and the larger selection we can offer.

One of the most critical elements of Books n Books’ success


will be its marketing and advertising. Our sales forecast for the
first three years is estimated to be as under:
Year 1 Year 2 Year 3

Rs.1,304,000 Rs.1,357,000 Rs.1,428,000


Type of retail format and ownership
Diamond Bookstore is a retail chain format having its stores at
multi locations in the state of Punjab, Haryana, and Uttar
Pradesh etc.

Form of ownership

Diamond Bookstore will be a general partnership type of


business. The shop will be jointly owned by Mohd Fahad, Mohd
Umar and Mohd Shabi. We expect to begin offering services in
December.

Roles of owners

All the owners will have to attend any type of meeting and
business deal. The members will have to be present during the
working hours.

Products and Services

Diamond Bookstore will offer a wide range of book, magazine,


and music selections. This includes just about every
conceivable category including fiction, non-fiction, business,
science, children's, hobbies, textbooks, and other types of
books. Our music selection will concentrate on CD's and DVD’s
as these are the most popular and take up the least amount of
floor space. In addition, we will be offering a competitive buy
and trade service to assist in lowering our inventory acquisition
costs and making our store more attractive to our customers.
In addition, we offer a search and order service for customer
seeking to find hard to get items. Diamond Bookstore will have
a relaxed "reading room" type atmosphere that we will
encourage through the placement of chairs, couches, etc. We
strongly encourage our customers to spend as long as they like
reading through our book selection and enjoying a quiet,
relaxing environment. Our store hours will be 8:30 a.m. to 8:00
p.m. Monday-Saturday and 10:00 a.m. to 6:00 p.m. Sunday.
Once profitability becomes stable, we will extend these hours.

Multi channel decisions


Multichannel retail decisions are those decisions through which
retailers sell merchandise or service by more than one channel.
By using a combination of channels, retailers can leverage the
unique benefits provided by each to attract and satisfy more
customers. There is three kind of multichannel retailing and
Diamond Bookstore uses all of them to interact with customers.

Store Channel: - Store offers a number of benefits to


customers that cannot get when shopping through catalogues
or on the internet. Diamond bookstore provides different
facilities in their stores or the convenience of customers.

1. Browsing – Shoppers often have only a great sense of


what they want but don’t know the specific item they
want. So they go to the stores to see what is available
before they decide what to buy.
2. Touching and feeling products – the greatest benefits
offered by Diamond bookstores is the opportunity for
customers to use all five senses-touching, smelling,
tasting, seeing and hearing- when examining the
products.
3. Cash payment – Stores are the only channel that accept
cash payments. Many customers prefer to pay with cash
because it is easy, resolves the transaction immediately,
and does not result in potential interest payments.
4. Entertainment and social experience – Shopping in a
Diamond Bookstore can be a stimulating experience for
some people, providing a break in their daily routine and
enabling to interact with friends.
5. Risk Reduction – When customer purchase merchandise in
stores, the physical presence of the store assures them
that any problems with the merchandise will be corrected.

Catalogue channel: - the catalogue channel provides some


benefits to the customers that are not available from the store
or internet channels.

1. Convenience – Catalogues, like all non store formats, offer


the convenience of looking at merchandise and placing an
order on any day at any time from almost anywhere. With
catalogue, customers have the added convenience of not
being restricted to a place with internet access and a
computer; they can look through catalogue on the beach
or propped up in bed.
2. Safety – security in malls and shopping areas is becoming
an important concern for many shoppers, particularly the
elderly. Non store retail formats have an advantage over
store-based retailers in that they enable customers to
review merchandise and place orders from a safe
environment- their homes.

Internet channel: - Shopping over the internet provides the


convenience and safety benefits offered by catalogues and
other non store formats. However the internet compared with
store and catalogue channels, also has the potential to offer a
greater selection of products and more personalized
information about products and services.
Customer Buying Behaviour
The buying process, the customers go through when buying a
product or service, begins when customers recognize an
unsatisfied need. They seek information about how satisfy the
need, such as what products might be useful and how they can
be bought.

RESEARCH DESIGN

The research design used here is exploratory research


design for the purpose of addressing the research problem.
The primary objective of exploratory research design is to
provide insights and better understanding of the situation
faced.

RESEARCH METHODOLOGY

In our research we have used both Qualitative and


Quantitative research extensively. Qualitative research would
be used for interviewing the sales management of Diamond
Bookstore in order to gain an insight of their style. Quantitative
research was done for interviewing corporate and for taking
surveys. The questionnaire for surveys had a mix of
quantitative and qualitative research.
DATA COLLECTION FROM PRIMARY SOURCES

Through Questionnaire

The data was collected through questionnaire it was prepared


very carefully so that it proves to be effective. The
questionnaire is based on primary and secondary objects of the
study and there are totally 15 questions.

Through Depth Interviews

The necessary data’s where collected by interviewing the


manager Mr. Mohd Umar of Diamond Bookstore.

SCALING TECHNIQUE

In our survey to find out the corporate behaviour towards


the price, quality of products sold, ambience, parking facilities,
store working hours, variety of products, approach of the sales
person and to rate the knowledge of the sales person the
scaling technique we used was continuous rating scaling. This
technique was used in order to find out the common
preferences towards the behaviour of the group.

QUESTIONNAIRE DEVLOPMENT & PRE – TESTING

The questionnaire was developed based on the


information needed i.e. to find out the corporate behaviour
towards Diamond Bookstore. In order to get the desired
information the survey method used was personal interviewing
and the questions where framed with respect to the objectives
of the questionnaire. Another important aspect of our
questionnaire is that, while framing the questions we made
sure that the type of questions and the words used where
simple and understandable by the respondents this was done
in order to create willingness and interest among the
respondents.

Pilot studies have been done among few random people,


to test the effectiveness of the questionnaire.

SAMPLING

It is the selection of small number of elements from a


larger defined target of group of elements and expecting that
the information gathered from the small group will allow
adjustments to be made about the large group. A sample is a
smaller representation of the larger whole. A sample contains
primary sample units and a slice of population representing the
universe. The purpose of sampling is to draw inferences
concerning the universe.

Sample size

One can say that the sample size must be an optimum size
that it should neither be large enough to give a confident
interval of desired width and as such the size of the sample
must be chosen by logical process before the sample is taken
from the universe. In order to extract much feasible result
through the study a sample size of 20 respondents has been
taken for the study.

Sampling Technique

The type of sampling used is simple random sampling. This


type of sampling is also known as chance sampling or
probability sampling where each and every item of the
population has an equal chance of inclusion in the sample and
each of the possible samples in case of finite universe has the
same probability being selected. This procedure gives each
item an equal probability chance of being selected. To carry
out the survey we had been to lots of corporate office all over
the Delhi to interview around 20 respondents.

Observation and Conclusion

1) In Delhi, prioritize the major book stores you can recall?


Book Diamon Higginboth Odyss Oxfor Americ Othe
stores d am ey d an rs
Booksto book
re store
Respond 50 20 15 10 0 5
ent
(in
Percent)

IMPRESSION:
According to the survey it was incepted that more than half of
the respondents could recall Diamond Bookstore first, one
fourth of respondents could recall Higginbotham, and
remaining was Odyssey, Oxford and Others.

2) Have you ever visited Diamond Bookstore?


Particulars Yes No
Respondents( in 100 0
Percent )
IMPRESSION: As per the survey it was found that all the
respondents have visited Landmark for either personal or
corporate purposes.
3) Which store you generally prefer to purchase books?
Book Diamond Higgin Odysse Oxfor American Others
stores Bookstor botha y d book
e m store

Respond 50 25 15 10 0 5
ents (in
Percent)

IMPRESSION: The survey says that 50% of the respondents


preferred Diamond Bookstore, 25% preferred Higginbotham
and 15% preferred Odyssey and 10% each of oxford and other
book stores.
4) Why do you prefer buying in that store?
Particula Diamo Higginboth Odyss
rs nd am ey
Choice & 70 0 30
Varieties
Custome 10 0 0
r Service
One 20 0 0
Stop
shoppin
g
Location 0 0 0
Access 0 70 30
Referenc 0 30 0
e
Cost 0 0 20
Ambienc 0 0 20
e
IMPRESSION: Varity/vertical of books was the dominant
reason for the respondents for preference that of book store
and other major reasons which contribute for the same are
Accessibility & Customer services.

5) What is it in the store that you like the most?

Particulars Diamond Higginbotha odyssey


Bookstor m
e
Ambience 50 30 35

offer and 15 0 0
promotion

Parking 5 0 30
facility
Customer 20 35 0
service

Location 10 20 35

One Stop 0 15 0
Shopping
IMPRESSION: Almost whole lots of corporate who shop at
Diamond Bookstore prefer the store for its Ambience &
Customer services.Those buyers of Odyssey find it convenient
buying because of its easy and Accessibility and Location.
6) What did you like the most in Diamond Bookstore?

particulars Variety of Large Air Helping


books space conditionin hands
g
Respondent(i 55 35 5 5
n percent)
IMPRESSION: Most of the respondents feel that “variety of
books” adds more value to Diamond Bookstore and other
major reason are “Large space” and “Helping hand.

7) How often do you shop in that store?


Particulars 0-1 Months 1-3 Months 3-6 months Above 6
Months
Diamond 30 40 20 10
Bookstore
Higginbotha 15 50 15 20
m
Odyssey 0 70 30 0
IMPRESSION: The frequency of purchase is as follows: 50%
of the respondents purchase every quarterly & the remaining
purchase half yearly.

8) Rather than books, what other kind of products do you


generally buy from that store?
Particular Diamo Higginboth Odyss
s nd am ey
Gifts 50 30 0
Stationeri 20 15 30
es
Music & 30 30 35
CDs
Not 0 25 35
specific
IMPRESSION: Apart from books most Corporate also
purchase Gifts, Music & CDs and Stationary from the store.
9) What kind of books you buy from that store?
Particulars Diamo Higginboth Odyss
nd am ey
Management 35 20 20
Finance 40 20 50
Computer 5 30 15
self motivation 0 10 5
Health 0 10 0
Magazine/perio 20 10 10
dic
IMPRESSION: Management, Finance/Accounts, Magazine &
Periodicals are the categories of books which are highly
purchased by the Corporate.

10)What is your mode of payment?


Particulars Landmark Higginbotham Odyssey

Cash 60 70 65

Credit 40 30 35

IMPRESSION: The survey states 70% of the corporate prefer


to pay through cash purchase and 30% credit purchase.
11)Are you happy with the credit terms of payment?
particulars yes No
respondent 45 55
IMPRESSION: Almost all the respondents are happy with the
credit terms of payment.

12)What is your mode of purchasing order?


particulars landmark Higginbotha odysse
m y
Phone 15 0 0
Visit 85 85 0
Website 0 15 35
post 0 0 65
IMPRESSION: Mode of purchasing order by “Visiting” the
store is found more convenient by the corporate compared to
order via Phone, Website or Post.

13)Do you visit the website of that particular store?


Particulars Yes No
Diamond 79 21
Bookstore
Higginbotham 0 100
Odyssey 0 100
IMPRESSION: According to the research there has been an
equal proportion between the users & non users of the stores
website. The main purpose for the visiting the website was to
get knowledge on variety of the books & its availability of
products.
14)How do you prefer to be informed about the

Particulars E-mail SMS Telephone Post


Diamond 55 25 10 10
Bookstore
Higginbotham 50 35 0 15
Odyssey 0 65 35 0
promotional/ discount offers?

IMPRESSION: According to the survey 70% of respondents


would like to be informed about Discounts & offers through E-
mail and 20% through SMS and rest by Post.

Particulars Yes No
Diamond 55 45
Bookstore
Higginbotham 35 65
Odyssey 0 100

15)Do they deliver the product at your door step?

16)

IMPRESSION: The satisfaction of buyers takes a back seat


here as the products are bought & generally not delivered by
the store.
Retail Market Strategy

As customers cut back on purchasing, Diamond Bookstore will


look more attractive to customers who still wish to purchase
books. Therefore, management believes this may be a good
time to get into the industry and gain market share. Diamond
Bookstore serve the entire purchasing population of its
geographical area but focuses on the customer who desire to
purchase books/music at a discount price and, with regards to
books, often do not see a long-term attachment to the product.

Target Market Segmentation

We anticipate serving the needs of all the potential customers


within a ten to fifteen mile radius in which the approximate
population is 150,000 (estimate). Bookshops serve the entire
purchasing population of its geographical area but focuses on
customers who desire to purchase books/music at low prices
because they are seen either as near commodity items or, in
the case of books, are not considered to be a long-term
investment (i.e. they will trade them back). This is especially
true with people seeking to cut costs with the bad economy.
Even though we service the entire book reading population in
University road and the surrounding area, we can divide our
customers based on purchasing habits.

Casual Shoppers: These are customers who go to the


bookshop with no set idea of what they want to purchase. They
seek to spend a fair amount of time browsing the store and
often are considered impulse buyers. Often they leave the
store with small purchases or without buying anything. These
customers are attracted to bookshops with low prices and large
inventory.

"Hard to Find" Shoppers: These are customers with very


specific needs. They are looking for a difficult to obtain item,
usually a book that is out of print. If we can satisfy this
customer, then we are able to build significant customer
loyalty. These clients are generally price insensitive and are
also drawn to bookshops that have large inventory.

Specific Category Shoppers: These customers are those


types that generally buy books or music of one category, such
as fiction or textbooks. These customers generally have a good
idea of what they want to purchase and have the greatest
buyback/trade potential. These customers represent the
highest volume purchaser, often leaving the store having spent
Rs500-1500.

Marketing Strategy
One of the most critical elements of Diamond Bookstore
success will be its marketing and advertising. In order to
capture attention and sales we will use prominent signs at the
store location, billboards, media bites on local news, and radio
advertisements to capture customers. We will arrange book
fairs in colleges and universities and will offer books to the
students on discount rates.

Sales Strategy

Since our store will be a standalone facility, there is little


in the way to directly influence how we close the sale other
than to have an attractive storefront with our low prices and
excellent selection. We believe this in itself is its own seller.
One critical procedure we will be establishing is to insure top
customer service and reliability and that our store always has
enough inventories of all our products. We will be using
industry data on inventory for bookstore chains to assist us.

Competitive Edge

The firm's competitive edge will be the lower prices we


will charge our customers and the larger selection we can
offer: through our large store, buyback/trade program, and
leveraging management excellent supplier contacts. As stated
before, in the bookstore industry, low cost and dominate
selection are the two success criteria. We plan to create these
advantages in a new, comforting environment that will retain
customers.

Financial Strategy

OBJECTIVES & GOALS

These are the goals for the next three years for Diamond
Bookstore:

➢ Achieve profitability by the mid of Year 2.

➢ Earn approximately Rs.2000000 in sales by Year 3.

➢ Pay owners a reasonable salary while running at a


profit.

KEYS TO SUCCESS

In order to survive and expand, Diamond Bookstore must keep


the following issues in mind:

➢ We must attain a high level of visibility through the


media, billboards, and other advertising.
➢ We must establish rigid procedures for cost control and
incentives for maintaining tight control in order to become
THE low-cost leader in books.

➢ In order to continually attract customers, we must be


able to keep the maximum amount of inventory available
and achieve a high level of customer service.

Financial Objectives

➢ All the partners will contribute initially Rs.15million. It


means each of the partners will invest 5million. The
remaining 10million will be obtained from a bank by
taking a loan.

➢ We expect Rs.3million to be the expenses of store


decoration, reading room arrangements, computer
systems and initial promotions.

➢ Of the remaining 2.2million, we will have our inventory.

Social Objectives

Societal Objective are related to broader issues about


providing benefits to society- making the world better place to
live. Diamond Bookstore will provide the employment
opportunities for people in a particular area or more specifically
for the handicapped.

Human Resource Management


The strategic Objective of Human resource Management in
Diamond Bookstore is to align the capabilities and behaviors of
employees with the short-and-long-term goals of the firm. Its
performance measure is employee productivity.

The HR manager will helps the firm in recruiting the new


employees for the maintenance and increasing the sales for
Diamond Bookstore.

Merchandise assortment, Planning and buying decisions

➢ The business and science books will be purchased from


National Book foundation, as they give discounts and offer
attractive packages for the retailers. For the textbooks we
will have to get registered with the local textbook board.
And for the other type of books including fiction, hobbies,
children and story books will be purchased from the
distributors in Chennai. Music CD’s and DVD’s will be
purchased the markets of Mumbai, Bangalore and from
foreign distributors as well.

➢ For the inventory control system we will buy software


through which we can keep the management informed
about day to day sales, quantity of stock and also about
the customers who visit us regularly.

➢ The customers will select books or music selections


from the display in the racks and the salesmen will
provide the item. Customers can also give orders for the
books which are not available with us, we will request the
distributor for that order and will provide it to the
customer.

➢ We will be using updated accounting software and


database software’s.

Pricing, promotion and communication-mix


decisions

Pricing: - the process of setting a price for a product,


including discounts. The price need not be monetary; it can
simply be what is exchanged for the product or services, e.g.
time, energy, or attention. A number of modes of pricing
techniques exist, which span:

1. Elasticities (whether Price Elasticity of Demand, Cross


Elasticity of Demand, or Income Elasticity of Demand)
2. Market skimming pricing
3. Market penetration pricing

I have used market penetration pricing in which a company


could release a product into a market years after it is initially
introduced, but at an artificially low price in order to stimulate
demand. The result of such a pricing strategy would be to draw
consumers from competitors and into purchasing its own
product. Low barriers to entry facilitate a company's ability to
sell goods at a price lower than its market clearing point.

Diamond Bookstore mission is to provide quality literature of all


types at the lowest possible prices in Peshawar. The firm
additionally seeks to provide a comfortable atmosphere for its
clients that promote browsing, relaxation, and an enjoyable
environment to spend extend time in. Diamond Bookstore
attraction to its customers will be our large selection of books,
magazines, music CD's and DVD’s and our purchasing/buyback
option, which lower our book acquisition costs and allows our
customers to discard unwanted books/CD's in exchange for
cash.

Promotion: - This includes advertising, sales promotion,


including promotional education, publicity, and personal
selling. Branding refers to the various methods of promoting
the product, brand, or company.
Advertising is the form of paid communication to customers
using impersonal mass media such as newspapers, T.V, radio,
direct mail, and the internet. Diamond Bookstore used all the
form of communication mix for the promotion of their sales and
products in order to build Brand image.

Diamond Bookstore will organized contest such as promotional


games of chance. They will provide gifts to their customers
who buy the books in large quantity.

Store Management:

Layout design- Diamond bookstore design layout offers some


unique challenges. Perhaps one of the greatest challenges is to
create a layout that has distinctive qualities and therefore sets
the store apart. Our facility is a 5,500 square ft. shop which
allows us to stock a large amount of inventory.

Visual merchandise decisions - Visual impact is a huge


component of retail merchandising. Customers entering a
store are greatly influenced by the visual information they
gather in the first split second. One simple visual element,
such as color, can catch a shopper’s attention and also greatly
affect their mood.

1. Display sale products in a creative way – Diamond


Bookstore when building a product display look for
products that are natural add-ons to the main product
featured. This is a great way to increase the margin.
2. Use accent lighting to feature products - Customers are
drawn to light. Lighting can make products shine and
bring colors to life. Using this visual merchandising tip to
wash a display wall with light will enhance any product.
Accent lighting creates visual interest for shoppers, and
magically puts products in their sight. Once a product has
captured a customer’s attention the odds are increased
that a purchase is at hand. This visual merchandising tip
will impact your customers’ impression of their shopping
experience and your profits.
3. Change displays weekly - This visual merchandising tip
reminds us that customers want to see new and different
products. There is an aspect of entertainment and
education that customers appreciate when stores change
their displays.

Customer relationship management and services


Diamond Bookstore provides quality literature of all types at
the lowest possible prices in Delhi. The firm additionally seeks
to provide a comfortable atmosphere for its clients that
promote browsing, relaxation, and an enjoyable environment to
spend extend time in.

Diamond Bookstore attraction to its customers will be our large


selection of books, magazines, music CD's and DVD’s and our
purchasing/buyback option, which lower our book acquisition
costs and allows our customers to discard unwanted
books/CD's in exchange for cash.

Diamond Bookstore Service:

Everything at Diamond Bookstore is focused at


customer satisfaction maximization. Vast range, trained polite
and courteous staff and never saying no to customers is the
aim of every Diamond Bookstore. The best customer order
process, home delivery of books/music, and an efficient
querying system are meant to satisfy every customer.

Quiz Programs:

Diamond Bookstore organizes an Open Quiz program


every year where over 1000 teams participate from all corners
of the country. It is the largest open quiz programme in the
country and has been successfully conducted in Delhi.

Loyalty Program:
Diamond Bookstore introduced a loyalty program named
'The Fellowship' in December 2003 for its customers. The main
objective of the program is to provide benefits to the member
not just as individuals but as a family.

Program Sponsorship:

Diamond Bookstore sponsors a number of programs


related to products and services within the periphery of
Diamond Bookstore business. A number of book launch events
and music performance events are organized and hosted by
Diamond Bookstore.

Conclusion

The corporate buyers find Diamond Bookstore favourable to


them, as they find all their requirements under one roof.
According to the survey, it was found that more than half of the
corporate preferred buying in Diamond Bookstore. The
familiarity for Landmark was gained through ‘Word of Mouth’.
And as per our finding we came to know that corporate want to
get informed about their promotional and discounts offers
through the mode of email. The primary reason for preferring
Diamond Bookstore was because of the huge collection of
collection of books, customer services, and ambience and also
for standard quality of the product. Besides books, corporate
also purchase stationeries, Music & CDs and gifts.

From the analysis of the survey it was also found that the
corporate would switch to Diamond Bookstore if the store
provides the facility to order through phone and delivery at
their door step.

Recommendation

Diamond Bookstore should try to encourage the corporate


customer to make cash purchases by offering those good
offers and discounts and by extending the credit period. The
discount should be volume based and on delay of payment
the discounts should be reduced and also could be made
void.

Adequate parking facility should be provided to all the


branches which would be flexible to the consumers to shop
from any three branches.

Coffee shop should be opened up in the store which would


help the customers to relax for sometime after heavy
shopping.

All the sales personnel should be given intensive training to


increase their product knowledge.

Book section should be improved by coming up with


categories like school books, painting, books relating to
Hindu mythology, devotional books. It should come up with
huge volumes. Movies collection on Moserbaer brand should
be increased in volumes.
References

1. www.wikipedia.org
2. www.scribd.com
3. http://www.discoverdbr.com/hardwarestoredesignlayout.h
tml
4. www.flipkart.com/retailing-management.../0070264376-
wmw3f9z9xf
5. http://www.shopworks.co.uk/file/2cc4bb605fba5808a5115
f4635349f82/top-tips-for-store-merchandising.html
6. www.chillibreeze.com/articles_various/retail-world.asp