Summer Internship Project

STUDY OF RETAIL SUPPLY CHAIN AND FLOOR OPERATIONS IN GLOBUS STORES PVT .LTD.
Submitted in partial fulfillment of PGDM program

2009-11

Submitted by

ANUPAM TRIPATHI

IB/02/10
Company Guide: Mr. Rakesh dubey supply chain executive Globus stores pvt.ltd. Faculty Guide: Mr. Rajneesh Mahajan

Apeejay School of Management Dwarka,New Delhi July 2010

CERTIFICATE

This is to certify that the project work done on STUDY OF RETAIL SUPPLY CHAIN AND FLOOR OPERATIONS IN GLOBUS STORE PVT. LTD. submitted to Apeejay school of

Management, Dwarka by Anupam Tripathi in fulfillment of the requirement for the award of Post Graduate Diploma in Business Management, is a bonafide work carried out by her under my supervision and guidance. This work has not been submitted anywhere else for any other degree/diploma. The original work was carried during 1/5/2010-to 24/6/2010 Globus Store Pvt. Ltd . in

Date: Seal of the Organization

Name of the guide

Address:

ACKNOWLEDGEMENT
Interdependence is a higher value than independence
Some Says Managers are born and some says managers are made. I was also in some dilemma before commencing my Summer Internship Project. But after the successful completion of my summer internship project, I came to know that managers are made if they are guided properly and are motivated to work willingly towards fulfillment of specific goal. First of all, I express my sage sense of gratitude and indebtedness to DEAN Sir-Mr.Deepankar Chakraborti and my mentor Mr. Rajneesh Mahajan for his valuable guidance and intellectual suggestions during this project helped me a lot in understanding supply chain concept. I express my sage sense of gratitude to my company mentor Mr.Rakesh Dubey for their kind advice, suggestions and constant help in a lot of various ways during project course.and I also thankful to Mr. Elhanan moore (Store Manager GLOBUS STORES PVT.LTD) and Mr. kanwaldeep singh (HR manager) who were kind enough to give an opportunity to work under their immense expertise. Last but not the least; I would also like to express my heartly gratitude to to my parents without their support and blessings that work was not possible.

TABLE OF CONTENTS
SERIAL No. 1.0 TITLE CHAPTER-1 EXECUTIVE SUMMARY 1.1 CHAPTER-2 INTRODUCTION INDIAN RETAIL SECTOR RETAIL SUPPLY CHAIN CHAPTER-3 1.2 Company background Vision of company Mission of company Quality policy Our endeavour Corporate values Organization structure Product line Industry analysis Porters five force model Marketing strategies Swot analysis 1.3 CHAPTER- 4 PAGE No. 7 7 9-16 9-16 9-14 15-16 1717 19 20 21 22 23 24-25 26-27 28-33 34-35 36-37 38-39 41-44 41-44 ABOUT THE PROJECT 1.4 CHAPTER- 5 45- 47

REPORT ON BUSINSS UNIT OBJECTIVE 1.5 CHAPTER-6 UNDERSTANDING OF FUNCTIONAL PROCESSE

45-46 47 48-67

WHAT IS SCM FUNCTION OF SCM PARTIES INVOLED IN SCM SALES TAX NORMS INTRO TO MARKET POTENTIAL &CATCHMENT ANALYSIS 1.6 1.7 CHAPTER -7 IMPROVEMENT IN PROCESSES LEARNING FROM THE PROJECT PART C 1.8 CHAPTER- 8 CONCLUSION 1.9 CHAPTER-9 RECOMMENDATIONS 2.0 CHAPTER-10

48 49 50-60 60-62 64-67

68-69

68-69

71-72

73-74

75 BIBLIOGRAPHY

CHAPTER 1
Executive Summary

The purpose of this report is to literally act as a window to the project undertaken as a part of the internship with the organization globus stores pvt. Ltd. that aims to define the breadth depth and scope of various thinking process that actually synthesized the projects undertaken. The objective of project is to understand how the supply chain of an organization works .To cope up the supply with the demand what company expects From a supply chain manager. to gain the competitive advantage along with this to understand various factors at the time of implementation of new products.Globus is indias one of the top retail chain.and they are handling big supply chain. Globus has 26 stores all over india in which they are selling no of brands like spyker, adidas, wrangler, flying machine , f-21, mufti, arrow, dpm, us pollo, provogue, levi,s, fruit of the loom , Indian terrain , globus etc. To maintain the proper stock of these brand in warehouse is not a easy task.it requires quite hard work . to maintain the proper stock , and to abstain from shrinkage globus uses MMS software in which supply chain executive feeds the detail of every item after unloading from Transpot company,supply chain staff scans garments by scan machine and then

details are download in mms software by supply chain superviser or executive.

Globus is running customer loyalty programmes which are handled by clp executive .i worked on this post around 20 days whr I learned the basics of this programme.this programme is designed to take customer feedback. In these programmes globus membership card is given to customer if he shops for rs 500 minimum, customers fill form whr they have to answer very questions like what they like about globus, what they hate about globus etc.

CHAPTER 2
INTRODUCTION

Retailing Customer is King

A Customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not an interruption on our work. He is the purpose of it. He is not an outside of our business. He is a part of it and we are not doing him a favor by servicing him. He is doing us a favor by giving us an opportunity to do so.

Mahatma Gandhi

Size
y y India is one of the 10 largest retail markets in the world Retail sales were US$262 billion in 2006, constituting over 30% of Indias GDP y Organised Retail constitutes only 4.6% of total retail sales - about US$12 billion p.a. y Has been growing at over 40% p.a. in the last 2 years.

Structure
y The Indian retail sector is highly fragmented: mostly owner-run Mom and Pop outlets y y There are over 15 million such Mom and Pop retail outlets Retail chains such as Pantaloon, Trent and RPG Retail have been growing rapidly; while Reliance, Bharti and Aditya Birla Group have announced investments of over US$9 billion in the sector y Dairy Farm, Metro, Shopritem, Wal-Mart and Marks & Spencer are some of the major international retail chains that are already present or in the process of entering the market y More than 100 international luxury brands are planning to set up shop in India.

Indian Retail Market

Food, Grocery & general merchandise- 63.7% Clothing, Textile & Fashion Accessories 8.5% Durables 4.1% Eating Out - 4.1% Home Dcor & Furnishing - 3.9% Other 15.8% (TSMG-Analysis)
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Overview
y The overall retail market is expected to grow from US$262 billion to about US$1065 billion by 2016, with organized retail at US$165 billion (approximately 15.5% of total retail sales) y India is expected to be among the top 5 retail markets in the world in 10 years. y India has been identified as the most attractive destination for retail in AT Kearneys Global Retail Development Index.

Future Potential
1. The high growth projected in domestic retail demand will be fuelled by: y The migration of population to higher income segments with increasing per capita incomes y y Increasing urbanisation Changing consumer attitudes, especially the increasing use of credit cards y Growth of the population in the 20 to 49 years age band

2. There are retail opportunities in most product categories and for all types of formats. y Food and Grocery: the largest category but largely unorganised today

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Home Improvement and Consumer Durables: over 20% p.a. CAGR estimated in the next 10 years

Apparel and Eating Out: 13% p.a. CAGR projected over 10 years

3. Opportunities exist for investment in supply chain infrastructure: cold chain and logistics 4. India also has significant potential to emerge as a sourcing base for a wide variety of goods for international retail companies 5. Many international retailers including Wal-Mart, GAP, JC Penney etc. are already procuring from India.

Some Published issue of Retail Industry

Indian retail is fragmented with over 12 million outlets operating in the country which is 13 times more the all retail outlets operating in USA (0.9 million outlets).

India has the highest number of outlets per capita in the world widely spread retail network but with the lowest per capita retail space (@ 2 sq. ft. per person).

A nnual turnover of Wal-Mart (Sales in 2001 were $219 billion) is higher than the size of Indian retail industry. Almost 100 times more than the turnover of HLL (India's largest FMCG Company).

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Developed economies like the U.S. employ between 10 and 11 percent of their workforce in retailing (against 7 percent employed in India today).

Most of the families belong to Socio Economy Class (SEC) A & B. Most of the residents fall in age group 18-45. Most of the families have 4 to 5 members in their families. Residents are well educated and holding jobs. Their monthly incomes are ranging from 10,000-20,000 and above. Approximately 86.5% people visit globus for shopping.

. y The reason for visiting super markets as mentioned by the

respondents varied from better services to pricing to variety of products available with the globus. 44.75% respondents visit globus for the prices offered and 46.75% mentioned that the quality of product provided is the reason for their visit to super markets.

Most of the customers complained regarding customer service, variety of product with deep assortment, store image, arrangement of products, pricing, product knowledge of employee, quality of products, parking space, product updation,

Company can enhance its business or increase its sales by doing these things; provide better customer service than its competitors, increase the variety of merchandise with deep assortment,

arrangement of product should be in proper way that creates good store image, provide globus membership card to the customers.

13

Indias retail industry, which is in the middle of rapid growth, has already seemed success stories fit to be the subject of a Bollywood film-Business Standard.

T he impact of organized retailers that have seen swarming of malls lately, on the mom-npop stores in 20 Indian cities- Indian Council of Research in International Economic Relations (ICRIER).

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Retail Supply Chain

Retail supply chain management revolves around understanding and balancing three key dimensions of availability, inventory and cost. Managing these trade-offs efficiently can result in supply chains that improve business performance and drive competitive advantage. Example: A) Spanish retail giant Zara. At Zara the supply chain is the business model. Rapid growth and profitability are clearly linked to an uncompromised approach to supply chain management that has delivered a world class three week "design to shelf" capability and fueled the company's 20 percent annual growth and profit margins. B) UK food retailer Tesco has developed continuous, within day, replenishment capabilities to underpin their fresh food offer and consistently deliver on-shelf availability of more than 98 percent. For these retailers, supply chain is a strategic differentiator that delivers a competitive edge. No longer just concerned about cost control, companies view supply chain as a key element of their business strategy. Today's supply chain leaders are working with their business partners to design, develop, move, store, sell and service their products with ever greater speed and economy. Now, more than ever, supply chains are regarded as sources of business value and competitive advantage. Differentiated supply chain models are emerging to address different merchandise characteristics. "One size fits all" no longer applies. Shortlifecycle fashion products require a supply chain that can cope with fast leadtimes and accelerated time-to-market tight integration with the supply

base is critical. Repeatable continuity products demand integrated and optimized replenishment and forecasting. Regardless of type, all supply chains need to be supported by effective core processes and capabilities.

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Supply chain leaders develop robust basic processes and disciplines, and then add new differentiating capabilities that drive supply chain excellence. These new capabilities enable leading retailers to transform and differentiate their supply chains. Creating change in an existing supply chain can be daunting. Given the breadth and depth of impact, virtually all areas of a business are affected. Accenture can offer a range of services from providing advice on specific functional areas including case studies and insights into other retailers and your competition to helping to implement a complete supply chain transformation

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CHAPTER 3
Company Background

globus, one of the youngest and fastest growing fashion apparel retail chains in India. Globus positioned itself as a store for customers age group catering from 18-35 years, which was ignored by most players in the market. Globus is customer oriented and friendly providing Trendy & Affordable garments to its customers with its tag line

Globus just like u and

just for u!!!

Globus - one of the leading chain of Fashion Apparel Retailers in the country. Part of the KP Raheja Group of Companies One of the most prestigious business houses in the country. Globus Stores Pvt. Ltd. was formed to contribute in the revolution sweeping the retail industry. Globus promises to bring about a perceptible change in the way apparel and lifestyle retailing has been carried so far. Towards this end, modern international technology has been brought in and heavy investments have been made in investing and acquiring the best, tried and tested processes and procedures of operation. Globus is one of the leading chains of retail store in the country. IT is part of the highly diversified R. Raheja group of companies one of the prestigious business houses in the country. 1st

Store -JAN1999-INDORE

2 nd STORE AUG 1999- CHENNAI 3rd STORE- OCT 2000- ADYAR

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4 TH STORE-MAY2001- 2001

5 TH STORE- SOUTH EX DELHI APR 2003

6 TH STORE-BENGLORE-OCT2003

7 TH STORE-BENGLORE-DEC03

As follows 24 stores (at present) have opened in the various cities of India. And all of that are running successfully.

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GLOBUS STORES PVT. LTD.

The Retail Chain Venture of the Rajan Raheja Group

Strong, Competitive, Innovative, Adaptive

Vision of Company:-

y We at Globus strive to achieve customer Delight by offering quality pro

-ducts and services through a process of continuous innovation and adaptation.

y

Build a dynamic team of committed and passionate employees through sustained learning and grooming.

y y y y y

Develop mutually beneficial relationships with our business partners. Employ cost effective process. We believe in honesty, integrity and fairness. Openness & transparency Discipline & accountability.

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Mission of Company
y

We at globus will cater to the lifestyle needs in garments & related acessories of the fashion ,quality & price conscious customer belongin to the middle and upper middle class.

y We would like to be known as proactive & trustworthy retail chain Pro-

viding the latest trends & exclusive merchandise.

o o

I shall share,I shall play fair. I shall say sorry if mistaken.

y I shall prepare for anything.

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QUALITY POLICY

y We at Globus Stores Pvt Ltd are committed to deliver trendyand innov

ative merchandise of good quality at affordable prices.

y We strive to achieve this through a customer focus approach and

continuous monitoring and reviewing of our quality process.

y With these efforts, we offer a delightful shopping experience to our

customers.

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Our Endeavour
Bringing to India, International Styles with an Indian Soul

22

Corporate Values

y y y y

Openness and Transparency Discipline and Accountability Honesty, Integrity, Fairness Respect for Individuals, Society and Environment.

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Organization structure
Grade Structure
Vice President M1 A Asst. Vice President M1 B Gen. Manager M2 A Dy. Gen. Manager M2 B Asst Gen. Manager M2 C Manager M3 A Dy. Manager M3 B Asst. Manager M3 C Sr. Executive / Tr. Dept Manager / Dept Manager Sr. Executive / Mgt Trainee

24

M4 A Supervisor / Executive / Zonal In-charge / CLP Executive Executive M4 B Sr. Sales Associate / Jr. Executive / CLP Associate Jr. Executive M5 A Assistant / Sales Associate Assistant M5 B Store Level HO Level Grade

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Product line

Globus is on a mission to democratize fashion and be 'the' iconic youth fashion brand in India. We aim to create deep connections with the Indian youth through inspiring product design, signature store experiences and compelling market.

GLOBUS BRANDS ------Youth Fashion Brand

Globus aspires to be 'the' iconic youth fashion brand in the country. Globus is a complete fashion brand - it's the apparel brand and the destination brand. Three words which capture the spirit of the youth - vibrant, maverick and expressive. GLOBUS IS EXACTLY THAT.

Eye candy fashion

F21 is an accessible hi-fashion brand, offering high-quality apparel. F21 - the edgy fashion brand - is designed to appeal to the more experimentative and adventurous consumers who seek cutting edge fashion.

The Globus Design Hub:

The heart of our business lies in this creative workplace of our organization named Globus Design Hub. It has been recently launched in July'07 in Andheri-Mumbai and is at its early stages to becoming the leading design talent floor. It is the most well equipped design studio in India in current times.

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INHOUSE BRANDS GLOBUS F-21

OTHER BRANDS ARROW SPYKER LEVI,S WRANGLER FLYING MACHINE US POLLO FRUIT OF THE LOOM ADIDAS BARBIE GINY &JONY LILLIPUT RUFF AMANTE PRETTY SECRETS INDIAN TERRAIN MUFTI DPM PROVOGUE

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RETAIL INDUSTRY ANALYSIS

The retail industry continued in India in the form of Kirana stores till 1980. Soon, following the odernization of the retail sector in India, many companies started pouring in the retail industry n India like Bombay Dyeing, Grasim etc. From that time the retail sector in India can be widely split into the organized and the unorganized sector.

Organized Retail Sector

After 50 years of unorganized retailing and fragmented Kirana stores, the Indian retail industry as finally begun to move towards modernization, Systematization and consolidation. Today, odernization is the catch phrase and the key to understanding retail in the next decade. There has been a boom in retail trade in India owing to a gradual increase in the disposable ncomes of the middle class households, as a result of good performance of IT, Service and nfrastructure sectors. More and more players are entering the retail business in India to introduce formats like malls,

supermarkets, discount stores, department stores and even changing the raditional looks of bookstores, chemist shops, and furnishing stores. Organized retail formats prevalent globally y y y y y y y y M alls Supermarkets Hypermarkets Discount Stores D epartment Stores S pecialty Stores Internet Retailing C onvenience Store

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Unorganized Retail Sector

The unorganized retail sector basically includes the local Kirana stores, hand cart, the vendors on the pavement (sidewalk) etc. This sector constitutes about 95% of the total retail trade. As 70% of the employment is generated in Agriculture sector, hence this form of retailing is widely een in those areas and of course to some parts of the urban. There is a lot of hue and cry in the sector for opening of sector for direct investment from the foreign players, but government cannot neglect interest of small players. One of main reason of not opening this

sector to FDI is it may shrink the employment in the unorganized sector and expand that in the organized.

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THE EVOLUTION OF RETAIL IN INDIA

Salesman Kirana shops Exclusive retail outlets Haats Convenience/Department stores Hypermarket Melas PDS Malls/Multiplexes Kiosks Pan/Beedi shops Specialty Malls Post Office Fast food outlets etc. India's Largest retail Chains: 1. PDS (Public Distribution System): 463,000 2. Post offices: 160,000 3. KVIC (Khadi & Village industries): 7,000 4. CSD (Canteen Stores Department) Stores:3,400

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(Source business world marketing White book 2005) The contribution of retail sector to GDP has been manifested below: Country Retail Sector's share in GDP (in %) India 10 USA 20 China 8 Brazil 6 The analysts foresee bright future of the retail sector. A huge number of shopping malls, nearly100, have come up in the recent past, generating 20mn sq ft. retail space, extending more space about 12mn sq ft to it. Nearly 60 malls are on the verge of completion and may be operational y the end of current financial year. A forecasted number of nearly 200 malls, in a move to make dditional 50mn sq ft of retail space, will be completed within the next two-years. India retail industry is expanding itself most aggressively; as a result a great demand for real state is being created. Indian retailers preferred means of expansion is to expand to other egions and to increase the number of their outlets in a city. It is expected that by 2010, India ay have 600 new shopping centers. In the Indian retailing industry, food is the most dominating ector and is growing at a rate of 9% annually. The branded food industry is trying to enter the ndia retail industry and convert Indian consumers to branded food. Since at present 60% of the ndian grocery basket consists of non- branded items. The global retail giants like Wal-Mart, par International, Tesco, K-Mart/SEARS, Carrefour, ZARA, FCUK, Carrefour Group and The homeDepot, NEXT, Mother Care, lKEA, Trussardi, DKNY and many more have made plans to march in the Indian market. Companies like Spencers, Shoppers Stop, Trent, Reliance, Lifestyle, Pantaloons Tanishq,Crossroads, Vishal and More already have planned to invest over Rs 5,000cr. Trent is on the edgeto take both its brands 'Star

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India Bazaar' and 'Westside' to new cities, meanwhile Shoppers' Stop as recently geared up for expansion of present ones and to add 11 new stores including two hypermarket. Pantaloon has planned to add eight 'Big Bazaar' malls within the next 6 to 8months and also Spencer has geared up for opening 15 hypermarkets in near future.

After partition, Reliance Industries Ltd (RIL) is substantially getting ready to enter in field of retailing. RIL is poised to emerge as the single largest player in this sector. On the other hand Toscos, Wal-Marts or Safeway does ultimately enter in the country. So finally, Shoppers'Stops, Westside, Pantaloons and West sides in coming years have will face stiff competition. Major Indian Retailers:y R PG Retail-Formats: Music World, Books & Beyond, Spencers Hyper, Spencers Super, Daily, Express & Fresh y Pantaloon Retail-Formats: Big Bazaar, Food Bazaar, Pantaloons, Central, Fashion Station, Brand Factory, Depot, aLL, E-Zone etc. y The Tata Group-Formats: Westside, Star India Bazaar, Steel junction, Landmark, and Titan Industries with World of Titans showrooms, Tanishq outlets, Chroma. y K Raheja Corp Group Formats: Shoppers Stop, Crossword, Hyper City, Inorbit y Lifestyle International- Lifestyle, Home Centre, Max, Fun City and International Franchise brand stores. y y y y y Pyramid Retail-Formats: Pyramid Megastore, True-Mart Nilgiris-Formats: Nilgiri's supermarket chain M ore-Formats: Supermarket chain and hypermarket chain Vishal Retail Group-Formats: Vishal Mega Mart BPCL-Formats: In & Out

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y y y y

R eliance Retail-Formats: Reliance Fresh R eliance ADAG Retail-Format: Reliance World G erman Metro Cash & Carry:- Wholesale S hoprite Holdings-Formats: Shoprite Hypermarket

International Retailers:The world's largest retailer, Wal-Mart, has tied-up with Sunil Mittal's Bharti Enterprises to enter Indian retail market. y M icrosoft's first shop-in-shop pilot has been launched with the Tata Group subsidiary Infiniti Retail's multi-brand consumer durables retail format, Croma. y The Walt Disney Company, consumer product retailing arm of global animation giant, will soon add 135 new stores to its existing 15 stores. y World's leading coffee chain, Starbucks' enters India through a tie-up with the country's leading multiplex operator PVR Limited. y Apple Inc has entered into an exclusive marketing and distribution deal with Reliance retailthrough "Store by Reliance Digital". y Some of the international players that have already entered India include McDonald's,Pizza Hut, Dominos, Levis, Lee, Nike, Adidas, TGIF, Benetton, Swarovski, Sony, Sharp,Kodak, Medicine Shoppe among others.

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PORTERS FIVE FORCE MODEL

Industrial rivals
Globus has no. of industrial rivals like shoppers stop, pantaloon, lifestyle, landmark ,big bazaar spencers. y Pantaloons and shoppers stop are the biggest competetor of globus in retail sector y With the entry of Spanish giant zarra ,the competition of retail sector will increase . y Globus is known for his trendy garments in menz,women and kidz wear in reasonable price. y globus is renowned for his inhouse manufacturing garments specially in western wear for girls.

Potential Entrants
y Entry of wall mart in Indian market will bring great competition for globus and others existing players. y To stand the same price level and maintaining their profit will be big question for retail players. y Entry of spannish giant zarra will enhance competition in Indian market. y Entry of other local and international players will bring competition as well as reduce the profit margin of existing players.

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Buyers bargaining power y Buyers are interested in this product because its range is less ranging
from Rs.300-3000. y y Globus is known for its reasonable price. Globus is famous for its quality in just valid rates that provides a value to customer in just small amt. of money. y In globus buyers can bargain in menz wear, womens Indian wear and western wear nad kidz wear. y Many schemes, discounts and loyalty programmes allow customers to avail services and provide them satisfaction.

Threat of substitute product

In Indian retail market with the entry of new players competition is increasing day by day.companies have to follow healthysupply chain to cop up with the demand of customers aswell as market demand . Entry of advance software systems like sap stock maintaining in warehouse is becoming easier.

Suppliers bargaining power

Suppliers are those who can exert power by threatening to raise price or reduce the quality of purchase goods and services.

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THE MARKETING MIX

Product
y y y Lineup of cutting-edge design garments that consumers clamor for. Excellent quality garmnent in menz,women and kidz wear section. Company is concentrating on big fashion houses and famous designers and hiring them to design garments.that will give customers better choices .

Price
y Catering to the entry-level segment in the initial phase company ,s basic t-shirt is in just r.199 y Company is providing all ranges clothes under one roof in very low amount . y Strong value for money proposition to establish globus.aspirational brand

Promotion
y Focus on Globus stores pvt ltd. reach to smaller & mid-sized towns with a higher focus on tier II & III (SEC B, C, D and E) markets y globus is promoting their brands by organizing fashion shows, and sponsoring annual functions in colleges. y Promotion is doing with the help of member ship cards and by tellecalling company is providing full detail of new schemes and

fashion to customers.

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Place
y

Globus ,s target is to open 100 storein all over India , and up till 2010 they have reached on 26 stores all over India .

Globus is opening store in places where the consumer is brand sensitive.

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SWOT ANALYSIS

Strength
y y y Globus renowned for its quality and price sensitivity Our Local Distribution Network Prices are affordable by those people who were willing to buy a stylish and good looking garment not spend too much. y Company is managing healhy supply chain very efficiently.

Weakness
y y y y Globus should hire experienced and well educated sales staff Sales staff is not result oeiented .they are just work oriented. Globus should concentrate on new fashion ranges also. Globus should change mms s/w.its processing is very slow.

Opportunities
y y Tapping new segments Garment is mass product thanclass productso company

shouldtarget on mass with the class. y y Rural areas having low reach of retail companies. Globus ay include shoes and sports wear in its store.

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THREAT
y y y Increasing no. of mncs Companies attracted towards low price strategy. Globus should cope up with new technologies.

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40

Chapter IV ABOUT THE PROJECT

Two months summer internship in globus stores pvt ltd. I worked on my project STUDY OF RETAIL SUPPLY CHAIN AND FLOOR OPERATIONS IN GLOBUS STORES PVT. LTD. I worked in Supply Chain department as well as I worked also as a CLP Executive in globus stores pvt. ltd. Where I understood the practical aspects of supply chain which I have studied in course. While preparing my project I understood that Supply chain management is the Integration of Business processes from enduser through Original Suppliers that provides products, services, and Information that addvalue for customers. Supply can be carried through a wide variety of transportation choices. A faster transportation not only helps to achieve a higher level of customer satisfaction in making the supplies available on time but also helps to increase the sales by seizing business opportunities, when there is a sudden rise in demand. To meet these objectives many corporations tend own their own fleet of transport and major factor in a supply chain system. This factor, therefore, seeks to establish the transport mode capacity, location, routing and the schedules of distribution so the supplies reach the destinations on time. Retailors are the most important link in the supply chain . They connect customers with The vendors who provide the merchandise. Its the retailors responsibility to identify customers wants and needs and work with other members of Supply chain manufactures, wholesalers ,transportation

41

Companies, and So onTo make sure The merchandise is available in the warehouse /stock when customers demand it. Global Retailers have increasingly taken a Leadership position in their Respective Supply Chains like-------- WALL-MART, CARREFOUR, ZARA, and KROGER have grown Dominant and control on Their Supply chain not only does size generates Power, But Knowledge about the customers play a vital role as well. As a Result of their position in the Supply chain, Retailers are in unique position to collect purchase information customer by customer, Transaction by Transaction. This information can be shared with suppliers to Plan Production, Promotion, Deliveries, Assortments and Inventory Level. Not many organizations go for in-house manufacturing .They rely on sourcing and developing vendors with elaborate systems to check and control quality. Even firms which decide in- house manufacturing often do not go for manufacturing full range of products to meet total market demand but decide on partial sourcing. Make-and-buy decisions make a significant impact on the cost structure of a companys products. Supply chain has number of variants in itself .without these variants supply chain department of an organisation can not work. a) Channel of Distribution Tomaintain the stock in warehouse or to transfer the stock to retailers, dealers, A wide choice of Channels is available. These include dealers, retailers, stockists, wholesalers, distributors, and, World Wide Web, etc.

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b) Supply Chain Configurations. A supply chain has a number of participants. Sources of supplies, storage or stocking stations, and distribution channels till he supplies reach to endcustomer constitute some of the major participants.

C) Inventory
This constitutes the core of SCM. The major costs of a supply chain, the level of customer satisfaction, the business growth (or fall) are largely influenced by the inventory strategy. There are several issues which are at conflict with each other and are required to be resolved. Higher inventory in warehouse helps in making the goods easily available to customers and result in growth of sales but this will simultaneously increase costs and bring down revenues. The determination of the demand of the products for the period considered. Many products in the market have s seasonal demand which is governed by factors such as festivals, weather (seasons), etc. Many other follow regular cycle. There are products which find market . When there is scarcity of alternatives. Demand planning is needed as it enables the company to organize its sourcing and stocking policies. The economics of a total system can go haywire if demand planning finally finds no resemblance to the actual market conditions. On the other hand an accurate demand forecast will result in totally smooth operations.

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d) Cordination with suppliers suppliers and manufacturers operate rather independently . suppliers have little information on what manufacturers need until they receive order from manufacturers need until they receive order from manufacturers. Similarly, manufacturers do not know materials are available with suppliers until they place a order and get a corresponding response. The status of information with manufacturers as to what is in the stock with the distributors, dealers, and retailers is hardly available and. Many stockists. also consider disclosure of this type of information of stocks as uncalled for as this is confidential. But in efficient SCM, manufacturers, suppliers, distribution channels, and Customers are linked in the form of chain to develop and deliver products as a single organization of pooled skills and resources

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CHAPTER V REPORT ON BUSINESS UNIT

Supply chain management is the Integration of Business processes from end user through Original Suppliers that provides products, services, and Information that add value for customers. Supply can be carried through a wide variety of transportation choices. A faster transportation not only helps to achieve a higher level of customer satisfaction in making the supplies available on time but also helps to increase the sales by seizing business opportunities, when there is a sudden rise in demand. To meet these objectives many corporations tend own their own fleet of transport and major factor in a supply chain system. This factor, therefore, seeks to establish the transport mode capacity, location, routing and the schedules of distribution so the supplies reach the destinations on time. Retailors are the most important link in the supply chain . They connect customers with The vendors who provide the merchandise. Its the retailors responsibility to identify customers wants and needs and work with other members of Supply chain manufactures, wholesalers ,transportation Companies, and So onTo make sure The merchandise is available in the warehouse /stock when customers demand it. Global Retailers have increasingly taken a Leadership position in their Respective Supply Chains like-------- WALL-MART, CARREFOUR, ZARA, and KROGER have grown Dominant and control on Their Supply chain not only does size generates Power, But Knowledge about the customers play a vital role as well. As a Result of their position in the Supply chain, Retailers are in unique position to collect purchase information customer by customer, Transaction by Transaction. This information can be shared with suppliers to Plan Production, Promotion, Deliveries, Assortments and Inventory Level.

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Not many organizations go for in-house manufacturing .They rely on sourcing and developing vendors with elaborate systems to check and control quality. Even firms which decide in- house manufacturing often do not go for manufacturing full range of products to meet total market demand but decide on partial sourcing. Make-and-buy decisions make a significant impact on the cost structure of a companys products.

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OBJECTIVE OF SUPPLY CHAIN

y To Eliminate Transaction Cost and Uncertainties Of Transaction Processing. y To Minimizing constraints of Order Fulfillment networks by enlarging effective scope of Retail . y y y y Improving Distribution Network Connectivity. Developing Professionalism and skills in Logistics management. To avoid irrelevant movement of Inventory within the Warehouse. Enabling the Creation and Distribution of accurate Information.

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CHAPTER VI
Understanding of Functional Processes/ Products WHAT IS SUPPLY CHAIN ------SCM as the "design, planning, execution, control, and monitoring of supply chain activities with the objective of creating net value, building a competitive infrastructure, leveraging worldwide logistics, synchronizing supply with demand, and measuring performance globally." (APICS dictionary) Supply chain management encompasses the planning and management of all activities involved in sourcing and procurement, conversion, and logistics management. It also includes the crucial components of coordination and collaboration with channel partners, which can be suppliers, intermediaries, third-party service providers, and customers. In essence, supply chain management integrates supply and demand management within and across companies. More recently, the loosely coupled, self-organizing network of businesses that cooperate to provide product and service offerings has been called the extended enterprises.

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Function of supply chain management

y y

Managing the movement of raw materials into an organization. Certain aspects of the internal processing of materials into finished goods.

The movement of finished goods out of the organization and toward the end-consumer.

Supply chain allows to focus on

core competencies and assemble

networks of specific, best-in-class partners to contribute to the overall value chain itself, then increasing overall performance and efficiency. y y Supply chain helps in Maintaining the proper stock in warehouse. Supply chain management helps in preventing the shrinkage problem which affects the profit ratio of an organization. y Helps in the manufacturing goods which lead to shorter cycle times, meaning improved responsiveness and efficiency in meeting customer demand. y Supply chain management helps in measuring the growth of an organization.Its measurement becomes increasingly important

because the difference between profitable and unprofitable operations presents the clear image of an organization.

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THE PARTIES INVOLVED IN THE SUPPLY CHAIN

The Concerned Category :

Its also has to determine the products that make up the category and itssegmentation from the consumer prospective. It also has to establish the categorys performance measurement and targets. Category has to play a Vital role in the Supply chain process. They have to decide On Vendors From which merchandise are to outsourced. Before that Vendor is registered in organization to supply the goods to globus warehouse Mumbai. Globus grown up to twenty six stores ,very much closer to meet the benchmark of 100stores in near future. Category is empowered by Organization to raise Purchase Order on an On-Line Software named as MMS. The Role Of Head Office Category is to buy in bulk from National Vendors Orders Disperse that merchandise to Mother Warehouse at Mumbai. And then transfer all the stocks to no of stores all over India.

SUPPPLIER
Vendors are the very important part of supply chain process .Because they are those parties who supplies the goods to a retail store. So it is considered that they run the businesses of Retail.In the process of selecting a particular vendor for meeting the critical inputs requirement , one relies on the vendor capabilities. Any failure on the part of vendor can have a crippling effect on the buyer. Therefore, it is essential that when selecting a vendor for strategic sourcing, evaluation should include the following parameter relating to the vendor.

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y y y y y y

Financial Health, Technology employed and technical capabilities, R & D Facilities. Quality Control mechanism, ISO 9002 certification, Previous track record of vendor regarding reliability (percentage on time) and quality (mean time between failure),

y y

Prevailing industrial relations scenario at vendors company, and Commodity allocation (preferential treatment in the event of shortage).

Vendor has to qualify certain essentialities before supplying inventory to globus.

TRANSPORTER
Transportation is defined as the physical flow of material and finished goods from point of origin to point of use to stores that meet customers need at a profit. It becomes very important to plan the process and an information

activity so an integrative process that optimizes the flow of material and supplies through the organization and its operations to the customer The Transporter has to collect the Merchandise from the Vendor Site and Transfer it down to various destination or it can be the respective Stores for Sales. Globus transport goods with the help of no. of logistic compnoies. LikeGati, future group supply chain , dtdc, safexpress .

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MOTHER DISTRIBUTION CENTER WAREHOUSE.

The Motherwarehouse at Mumbai uses master of merchandise (mms) system that promises to identify the Inventory with planning and real time data for quicker decision making.

INBOUND LOGISTICS
This Warehouse receives Inventory from Various parties in shipments.all the stocks are transferred from mother warehouse mumbaito all other 26 stores with the station transfer note .this transfer of shipment fro mother warehouse is done with the help of no of logistic and supply chain companies.

OUTBOUND LOGISTICS
Warehouse executive Starts performing the Task for Outward when DM/ADM or Category fires Stock report for analysis. And rises Stock Transfer Order for transformation of Inventory from Warehouse to The Floor Shop at store. Inventory can only move from warehouse to the store If and Only Stock Transfer Note (STN) by the Authorized person in the store he can be

Department Manager / Assistant Department Manager If the requirement arises for the brands other than globus then purchase order is required . this purchase order is made by supply chain executive and signed by purchase manager .

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In case if the goods are imported to UP

four Stated forms are as below :-

from other state

Uttar Pradesh West Bengal (Kolkata)

Form 31 Form 42 Form 48 Form 38

Madhya Pradesh (Indore) Haryana (Goods Worth

above Rs 25,000)

Incase If the Vendor is Indigenous and belongs to same State or his site is located within the same city then he has to obtain the OC(Originating Certificate) which he arrange from his organization because that will also be registered . OC is to be affixed on the Invoice Paper and the Total value of goods for Shipment is to mention on the OC as well. Vendor has to affix bar codes on the goods for delivery. These bar codes are issued to them at time of Purchase Order Generation by the Category.

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FLOW CHART OF THE PROCESS

Purchase Order From Zonal or Head Office

Collects State Form by commercial or Zonal

Originating Certificate if Vendors Site is Indigenous

Affix Bar Codes on Inventory as per PO

Prepare Invoice Papers

Load The Inventory and Dispatch it for Warehouse or Store

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Meets Security Incharge on Duty

Checks documents LR Copy, LR Date, Consignee Address, Expiry date, No. Of Cartoons/boxes Weight, Transporters name

Purchase order Number, Date , Consignee Address

Invoice Document, Its date , amount , quantity, Consignee address , Purchase Order Numbers

Way bill number , Description of Goods , Quantity weight , Freight of goods , Its value in Figures as well in words also

Merchandise is Unloaded from Vehicle

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Incase of incomplete documents unload the goods but keep segregated from other delivery

Consult to the Inward Incharge

GRN is not creation at that point

Mail that shipment of purchase order to the Respective category.

Wait for complete documents for 15 days

Within 15 days of time the Pending documents will be cleared from the vendor.

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INVENTORY INWARD ON SOFTWARE MMS

all the inventory which is unloaded by transporter are feeded in master of merchandise system software by the supply chain executive .This stock is properly checked after the scan of goods .AND The documents handover by the transporter company are maintained in a file .

DOCUMENTATION FOR OUTWARD

Stock Transfer Note is a Document in it description of articles for outward are mention. GATE PASS AT WAREHOUSE FOR OUTWARD It is to be ensured as per STN and Handling Unit Number on cartoons and properly pasted . Then Load the Shipment of Material in the Lorry as Per STN. Then information is passed to the Outward Incharge for preparation of Gate pass on mms software

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FLOW OF MERCHANDISE

CATEGORY

CDC WAREHOUSE

RESPECTIVE STORES

CUSTOMERS

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INVENTORY MOVEMENT

2. Outward Movement 1. Inward Movement

inward INWARD

From Vendor

From CDC

Consignment Stock

Return from MDC

OUTWARD

To Home Deliveries

To Stores To Warehouses To Vendor

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INBOUND DELIVERY IN THE STORE

CDC WAREHOUSE

VENDORS

RESPECTIVE STORES

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SALES TAX NORMS FOR TRANSFORMATION OF GOODS

Sales Tax Rules related to inwarding & outwarding from (U.P.)

1. If material is received from Vendor

(a) outside up the Form 31 is must but the endorsement is necessary by the sales tax check post if the check-post is in the way of transit. And this is applicable for Trading / Non trading items and no relation with value or zero value so in every circumstance it is required.

(b) ll the road permits, specially form 31 should be handed over to the commercial department as early as possible because it should be handed over to the sales tax department with-in 24 hours.

2. If material is received from Vendor/ Warehouse with-in U.P.

(a) .C. stamp is required.

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3. For outwarding of material from Gahaziabad

(a) O.C. stamp is required if material is outwarded from Noida and the stamping of check post is must if the check post is in the transit way. And this is applicable for Trading / Non trading items and no relation with value or zero value.

TREATMENT FOR STOCK SHORTAGES AND DAMAGES OF INVENTORY

Shortages and damages in inventory occur at many points in the whole supply chain Process . It occurs from: Vendor to warehouse in warehouse From warehouse to store In store At all the places, they occur due to some different regions so we discuss all these in detail. I divide shortages and damages into two categories one when it occurs in warehouse and other when it occurs in store.The fig. A which is given below is show how the stock is moves in the supply chain but the fig. B gives the movement of stock when there is some damage or shortage at the various points in the supply chain.

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Discrepancy Report

After entering the material in the MMS Executive identify the actual quantity which we get and after that a discrepancy note is made by the WH person which tells they get and what they get and also about the damaged items and this note is passed to vendor and zonal office also so that vendor get payment according to actual quantity. Then Damages Report are Mailed to Vendor and Transporter with the written document presented on value chain is Debited From Transporters Account. Shortages are Informed To Vendor by Mail and to the Category also to the Commercial Department with the invoices of Vendor and respectively They also debited at time of Payment

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INTRODUCTION TO MARKET POTENTIAL AND CATCHEMENT ANALYSIS

Market Potential :
Market Potential is the total amount of a product/service that customers will purchase within aspecified period of time at a specific level of industry wide marketing activity or estimatedmaximum total sales revenue of all suppliers of a product in a market during certain period oftime. This is an important aspect of marketing since one has to do market research related to hisindustry product which can be business to consumer or business to business. Market potential isbasically carried out to know the strength in the industry also to allocate the target to the sales force based on optimum market research which normally includes the customers requirementand their expansion plans, investment etc. With optimum information a company can knowamount of investment for a product, also for a particular area.

Total Market Demand:The total market demand for a product or service is the total volume that would be bought by adefined consumer group in a defined geographic area in a defined time period in a definedmarketing environment under a defined level and mix of industry marketing effort. Total marketdemand is not a fixed number but a function of the stated conditions.

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Market Demand
shows the relationship between total market demand and various market conditions. In this figure, upper limit of market demand is called Market Potential. Companies have developed various practical methods for estimating total market demand. A common method to estimate total market demand is as follows:Q=nqp Where Q = total market demand n = number of possible buyers in the market q = quantity purchased by an average buyer per year p = price of an avg. unit

Benefits of Market Potential Analysis:

Understand market potential for a single store, network of stores or a new market.

y y

Deploy resources effectively by ranking markets in priority order. Forecast total opportunity in terms of number of customers and revenue potential.

E stimate your market share.

A market potential analysis may include: y y A customer profile to understand where to find more like them Market penetration and market share reports showing performance in existing markets and expected performance in new markets y Market ranking reports allowing you to prioritize resource deployment into new markets

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BOTTOM UP OR TOP DOWN MARKET ANALYSIS:

yA Bottom Up approach to market sizing starts with a company customers. How muchand often do they buy? What is their profile? How many potential customers do you havein the market based on your customer profiles? How can you reach them? y A Top Down approach starts with market and industry data. It takes a close look at ageographic market area and profiles the consumers and/or businesses to let you knowtheir propensity to buy your products and services. Estimating the market or market potential for a new business or business expansion is critical indetermining the economic feasibility of a venture. But market potential is very essential for thecompany and by knowing market potential a company can make its position in the market by finding how many players are there in that sector.

CATCHMENT ANALYSIS
yIf a company doesnt know who its shoppers are, how can company give them what theywant? If company doesnt know where they come from, how can company communicatewith them? Finding answers to these questions is vital but catchment analysis is veryhelpful in that. y A company or retail store will be able to optimize its activities if and only if companyknows its market in depth. Its market penetration, its success and its potential depend ongeographical factors, hard to grasp, hard to fully understand, but catchment analysis isvery helpful. y I n the catchment analysis, first part is the area mapping of that local market and throughthat finds the locations of the competitors, customers

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and traffic between them. Throughthat we quantify the sizes and potentials of that local catchment areas and market of that area as whole. y With the help of catchment analysis, company knows the best location for business, targetand potential customers

Type of catchment area

There are four type of catchment area that is following --Unitary Catchment It is hub of the catchment area around the outlet, from where maximum number of people comes to the retail stores for shopping. Secondary Catchment This area is called secondary catchment area which is around 2 km far away retail stores from where some people come to the shop for shopping. Tertiary Catchment The area from where only some selected or loyal customers come to the retail stores that is more than 2 km far from outlet. Outer Catchment Outer catchment area is totally outer area from where only less no. of person sometimescomes to the out.

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CHAPTER VII
Improvements in Processe

LEARNINGS FROM THE PROJECT

IN summer internship woking on my project study of retail supply chain and floor operations in globus stores pvt. Ltd. I got the opportunity to work in a corporate and understanding the practical aspects of the study. working in globus is first job experience for me and that was very valuable for me . it gave me opportunity to understand the on job experience. First time I felt job pressure in globus . I saw the sales associate working hard for completing their targets. This project gave me the understanding of the practical approach of the industry and new technologies such as MMS,CLP PROGRAMMES. We always studied and talked of various things like minimizing of the cost, minimizing the risk, error free task, effectiveness and efficiency of work, Just in Time approach but through our project we understood these concepts in practicality. How the implementation of IT and new technologies can improve the flow of goods and material in the operation and how it is important to sustain in the competitive environment to install the new technology to minimize the cost and maintaining effectiveness and efficiency of the work which meet the organizations objective. This project has provided a practical learning experience to us. We have studied about the warehouse and warehouse management system in our

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class but were not aware the fact that how it is important for the organization. We were aware of the fact that warehouse is a part of supply chain management and the activities of the warehouse such as receiving, storage, dispatch and handling of the goods, maintaining the records of incoming and outgoing of the goods. t the importance of these activities we got to know from this project work. How can it affect the whole supply chain process?

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CHAPTER VIII
CONCLUSION

This project has provided a practical learning experience to us. We have studied about the warehouse and warehouse management system in our class but were not aware the fact that how it is important for the organization. We were aware of the fact that warehouse is a part of supply chain management and the activities of the warehouse such as receiving, storage, dispatch and handling of the goods, maintaining the records of incoming and outgoing of the goods. But the importance of these activities we got to know from this project work. How can it affect the whole supply chain process? Because of this project we got to have the practical knowledge. This project gave us the practical approach of the industry and new technologies such as MMS,CLP PROGRAMMES, we always studied and talked of various things like minimizing of the cost, minimizing the risk, error free task, effectiveness and efficiency of work, Just in Time approach but through our project we understood these concepts in practicality. How the implementation of IT and new technologies can improve the flow of goods and material in the operation and how it is important to sustain in the competitive environment to install the new technology to minimize the cost and maintaining effectiveness and efficiency of the work which meet the organizations objective. In the organized retail market , globus come up with the new range and

giving competition to Big Bazaar, pentaloons,life style. retalioutlets. In the near future, it plans to open many stores. Hence, Spencers has to take

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someimportant steps to overcome its problem areas and implement the suggestions before the existing and new retailers grab the opportunity making globuse even more challenging.To sum up, globus facing competition from its competitors Big Bazaar, More, VishalLife style , pantaloons, shoppers stop tc. establishing its stores in prime area of the city. globus do intensive media advertisements by roping in celebrities as brand ambassadors to create awareness of its existence, since most of the customers came to know only through friends and family. products,range of items, pricing and advertisement regarding offers and discounts which can mesmerizethe customers to walk in to globus.parking should be increased and quality of sales executive should be improved by appointing experienced sales staff who can cater to the needs of the customers. Themanagement has to take some major steps and implement the above mentionedsuggestions/recommendations as it directly affects the sales of globus. market have good opportunity for retail business, most of the people belong to SEC A & B,educated and earning more money. 86.5% people go to globus,can enhance itsbusiness or increase its sales by providing better customer service than its competitors, increasethe variety of merchandise with deep assortment and intensive promotion with the help of pamphlets, kiosks, radio about various offers, also provides globus membership card.

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CHAPTER IX
Recommendations

Most of the customers believe that stock is not updated and no offer schemes areprovided on the old stock. Same price is charged for both the fresh stockand old stock. Respondents feel offers should be provided on the old stock, as is done inother retail stores. y As the majority of customers are falling age group of26-35 and 1825.Company should concentrate on the need of people falling into that category. y G lobus sgould employ experienced employeesso that they can better explain the quality and features of the products. y Some of the people find in-store environment of globus is dull try to maintainnice store image which attracts the customers and it works in word of mouth marketingfor attracting more customers. y V ariety of products should be increased for better selection by the customers so thatcustomers can choose from a huge lot of items of different companies having differentfeatures as the customers of globus want more variety ofproducts. y .People generally search for the product on offer so the high margin product should be upfronted that mean those item should be in the eye height so that it easily catches thecustomers attention and generates impulse purchase. y .in India percentage family member group 5 and 4 is more.

Therefore company should try to attract that family by providing family pack apparels.offer at discount rate y To improve Product visualization the Company should do visual merchandising in betterway.

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g lobus do intensive advertisement through pamphlets, local newspaper,banners, FM Radio, Kiosks for creating more awareness.

Variety of products should be increased with deep assortment for better selection by the customers so that customers can choose from huge lot of items of different companies having different features.

Customers are very eager to know about offers, discount schemes provided so globus should do better marketing for creating awareness about offers and discount schemes.

Complained and feedback should be taken care in well manner to create the loyalty and goodwill

y y

M erchandise should be arranged properly. C ompany should offer competitive price with good quality of products because most of the customers visit to globus for better price and quality of products.

Company should give information to the customers through the marketing gimmick (sms) using database of customers.

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Bibliography

Books:y y y y Globus merchandising Supply chain management by sunil chopra ,peter meind Export import management by Dr. U.K. Neogi Retail management by levvy and wietz

Websitesy y y y y y y www.globus.com www.accenture.com Retail wikipedia www.google.com http://www.ril.com/html/business/business_retail.html http://www.bharatpetroleum.in/wheels/inOutStores.asp# http://www.moneycontrol.com/news/business/lalmahal-group-foraysinto-retail_327987.html

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