1

SUMMER INTERNSHIP REPORT

RELIANCE RETAIL LTD

STUDY ON SUPPLY CHAIN PROCESS AT

RELIANCE RETAIL LTD

SUBMITTED BY
PAIDIPATI DIVYA
KRITHIKA.K
M.S.RAMAIAH INSTITUTE OF MANAGEMENT

Introduction

India has often been called a nation of shopkeepers. Presumably the reason for this
is; that, a large number of retail enterprises exist in India. In 2004, there were 12

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million such units of which 98% are small family businesses, utilizing only
household labour. Even among retail enterprises, which employ hired workers, a
majority of them use less than three workers.

Retailing is the combination of activities involved in selling or renting consumer

goods and services directly to ultimate consumers for their personal or household
use. In addition to selling, retailing includes such diverse activities as, buying,
advertising, data processing and maintaining inventory.

While sales people regularly call on institutional customers, to initiate and

conclude transactions, most end users or final customers, patronize stores. This
makes store location, product assortment, timings, sto fixtures, sales personnel,
delivery and other factors, very critical in drawing customers to the store.

Final customers make many unplanned purchases. In contrast those who buy for
resale or use in manufacturing are more systematic in their purchasing. Therefore,
retailers need to place impulse items in high traffic locations, organize, store layout
, trains sales people in suggestion , and place related items next to each other, to
stimulate purchase.

WHAT DOES THE RETAILING INDUSTRY INCLUDE?

Department Stores

Discount Stores

Clothing Stores

Specialty retailers

Convenience Stores

Grocery Stores

Drug Stores

Home furnishing retailers

Auto Retailers

Direct Sales Catalog and mail order companies

Some e-commerce businesses

THE IMPORTANCE OF RETAILING

Organized retailing in India was estimated at Rs.18, 000 crores in 2002-2003 and
has grown at about 40% over the last 3 years (Source KSA Retail Outlook).

Retailing has a tremendous impact on the economy. It involves high annual sales
and employment. As a major source of employment retailing offers a wide range of
career opportunities including; store management, merchandising and owning a
retail business.

Consumers benefit from retailing in that, retailers perform marketing functions that
makes it possible for customers to have access to a broad variety of products and
services. Retailing also helps to create place, time and possession utilities. A
retailer's service also helps to enhance a product's image.

Retailers participate in the sorting process by collecting an assortment of goods

and services from a wide variety of suppliers and offering them for sale. The width
and depth of assortment depend upon the individual retailer's strategy.

They provide information to consumers through advertising, displays and signs

and sales personnel. Marketing research support is given to other channels,
members.

They store merchandise, mark prices on it, place items on the selling floor and
otherwise handle products; usually they pay suppliers for items before selling
,,

them to final customers. They complete transactions by using appropriate

locations, and timings, credit policies, and other services e.g. delivery.

Retailing in a way, is the final stage in marketing channels for consumer products.
Retailers provide the vital link between producers and ultimate consumers.

RETAIL STRATEGY AND STRUCTURE

Successful retail operations depend largely on two main dimensions: margin and
turnover. How far a retail enterprise can reach in margin and turnover depends
essentially on the type of business (product lines) and the style and scale of the

4
operations. In addition the turnover also depends upon the professional
competence of the enterprise.

In a given business two retail companies may choose two different margin levels,
and yet both may be successful, provided the strategy and style of management are
appropriate.

MARGIN TURNOVER MODEL

Ronald R. Gist "Suggested a conceptual frame work, using margin and turnover,
for understanding the retail structure and evolving a retail strategy."

Margin is defined as the percentage mark tip at which the inventory in the store is
sold and turnover is the number of times the average inventory is sold in a year.
This is a diagrammatic representation of the frame work and can be applied to
almost any type of retail business.

Depending upon the, combination of the two parameters, a retail business will fall
into one of the four quadrants. For instance L-L signifies a position which is low
on both margin and turnover; whereas, H-L indicates high margin and low
turnover.

LOW MARGIN HIGH TURNOVER STORES

Such an operation assumes that low price is the most significant determinant of
customer patronage. The stores in this category price their products below the
market level. Marketing communication focuses mainly on price. They provide
very few services; if any, and they normally entail an extra charge whenever they
do. The merchandise in these stores are generally pre-sold or self sold. This means
that the customers buy the product, rather than the store selling them.

These stores are typically located in isolated locations and usually stock a wide .
range of fast moving goods in several merchandise lines. The inventory consists of
well known brands for which a consumer pull is created by the manufacturer
through national advertising. Local promotion focuses on low price. Wal-mart in
the United States is an example and Pantaloon Chain or Subhiksha are Indian
examples of such stores.
HIGH MARGIN LOW TURNOVER

This operation is based on the premise that distinctive merchandise, service and
sales approach are the most important factors for attracting customers. Stores in
this category price their products higher than those in the market, but not
necessarily higher than those in similar outlets. The focus in marketing
communication is on product quality and uniqueness.

Merchandise is primarily sold in store and not pre-sold. These stores provide a
large number of services and sell select, categories of products. They do not stock
national brands which are nationally advertised. Typically, a store in this category
is located in a down town area or a major shopping center. Sales depend largely on
salesmanship and image of the outlet.
HIGH MARGIN HIGH TURNOVER STORES

These stores generally stock a narrow line of products with turnover of reasonably
high frequency. They could be situated in a non commercial area but not too far
from a major thoroughfare. Their location advantage allows them to charge a
higher price. High over head costs and, low volumes also necessitate a higher
price.
LOW MARGIN-LOW TURNOVER STORES

Retail enterprises in this category are pushed to maintain low margins because of
price wars. Compounding this problem is the low volume of sales, which is

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probably a result of poor management, unsuitable location etc. such businesses,
normally get wiped out over a period of time.
RETAILING FORMATS (CLASSIFYING RETAIL FIRMS)

Regardless of the particular type of retailer (such as a supermarket or a department

store), retailers can be categorized by (a) Ownership, (b) Store strategy mix, and
(c) Non store operations. Figure 1.3 illustrates this concept.

Form of Ownership

A retail business like any other type of business, can be owned by a sole proprietor,
partners or a corporation. A majority of retail business in India are sole
proprietorships and partnerships.

Independent Retailer

Generally operates one outlet and offers personalized service, a convenient

location and close customer contact. Roughly 98% of all the retail businesses in
India, are managed and run by independents, including barber shops, drycleaners,
furniture stores, bookshops, LPG Gas Agencies and neighborhood stores. This is
due to the fact that into retailing is easy and it requires low investment and little
technical knowledge. This obviously results in a high degree of competition..

Most independent retailers fail because of the ease of entry, poor management
skills and inadequate resources.
Retail Chain

It involves common ownership of multiple units. In such units, the purchasing and
decision making are centralized. Chains often rely on, specialization,
standardization and elaborate control- systems. Consequently chains are able to
serve a large dispersed target market and maintain a well known company name.
Chain stores have been successful, mainly because they have the opportunity to
take advantage of "economies of scale" in buying and selling goods. They can

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maintain their prices, thus increasing their margins, or they can cut prices and
attract greater sales volume. Unlike smaller, independent retailers with lesser
financial means, they can also take advantage of such tools as computers and
information technology. Examples of retail chains in India are Shoppers stop; West
side and IOC, convenience stores at select petrol filling stations.
Retail Franchising

Is a contractual arrangement between a "franchiser" (which may be a manufacturer,

wholesaler, or a service sponsor) and a "franchisee" or

Franchisees, which allows the latter to conduct a certain form of business under an
established name and according to a specific set of rules. The franchise agreement
gives the franchiser much discretion in controlling the operations of small retailers.
In exchange for fees, royalties and a share of the profits, the franchiser offers
assistance and very often supplies as well. Classic examples of franchising are;
McDonalds, Pizza Hut and Nirulas.
Cooperatives

A retail cooperative is a group of independent retailers that have combined their

financial resources and their expertise in order to effectively control their
wholesaling needs. They share purchases, storage, shopping facilities, advertising
planning and other functions. The individual retailers retain their independence,
but agree on broad common policies. Amul is a typical example of a cooperative in
India.
Store Strategy Mix

Retailers can be classified by retail store strategy mix, which is an integrated

combination of hours, location, assortment, service, advertising, and prices etc.
The various categories are:

(A)Convenience Store: Is generally a well situated, food oriented store with long
operating house and a limited number of items. Consumers use a convenience
store; for fill in items such as bread, milk, eggs, chocolates and candy etc.

(B)Super markets: Is a diversified store which sells a broad range of food and non
food items. A supermarket typically carries small house hold appliances, some
apparel items, bakery, film developing, jams, pickles, books, audio/video CD's etc.
The Govt. run Super bazaar, and Kendriya Bhandar in Delhi are good examples of
a super market. Similarly in Mumbai, we have Apna Bazar and Sahakari Bhandar.

(C)Department Stores: A department store usually sells a general line of apparel

for the family, household linens, home furnishings and appliances. Large format
apparel department stores include Pantaloon, Ebony and Pyramid. Others in this
category are: Shoppers Stop and Westside.

(D)Speciality Store: Concentrates on the sale of a single line of products or

services, such as Audio equipment, Jewellery, Beauty and Health Care, etc.
Consumers are not confronted with racks of unrelated merchandise. Successful
speciality stores in India include, Music World for audio needs, Tanishq for
jewellery and McDonalds, Pizza Hut and Nirula's for food services.

(E)Hyper Markets: Is a special kind of combination store which integrates an

economy super market with a discount department store. A hyper market generally
has an ambience which attracts the family as whole. Pantaloon Retail India Ltd.
(PRIL) through its hypermarket "Big Bazar", offers products at prices which are
25% - 30% lower than the market price.
Non Store Retailing

In non store retailing, customers do not go to a store to buy. This type of retailing
is growing very fast. Among the reasons are; the ability to buy merchandise not
available in local stores, the increasing number of women workers, and the
presence of unskilled retail sales persons who cannot provide information to help
shoppers make buying decisions

The major types of non store retailing are:

(A)In Home Retailing: Where, a sales transaction takes place in a home setting including door-door selling. It gives the sales person an opportunity to demonstrate
products in a very personal manner. He/She has the prospect's attention and there
are fewer distractions as compared to a store setting. Examples of in home retailing
include, Eureka Forbes vaccum cleaners and water filters.

(B)Telesales/Telephone Retailing: This involves contact between the prospect and

the retailer over the phone, for the purpose of making a sale or purchase. A large
number of mobile phone service providers use this method. Other examples are
private insurance companies, and credit companies etc.

(C)Catalog Retailing: This is a type of non store retailing in which the retailers
offers the merchandise in a catalogue, which includes ordering instructions and
customer orders by mail. The basic attraction for shoppers is convenience. The
advantages to the retailers include lover operating costs, lower rents, smaller sales
staff and absence of shop lifting. This trend is catching up fast in India.
Burlington's catalogue shopping was quite popular in recent times. Some multi
level marketing companies like Oriflame also resort to catalogue retailing.

(D)Direct Response Retailing: Here the marketers advertise these products/

services in magazines, newspapers, radio and/or television offering an address or
telephone number so that consumers can write or call to place an order. It is also
sometimes referred to as "Direct response advertising." The availability of credit
cards and toll free numbers stimulate direct response by telephone. The goal is to
induce the customer to make an immediate and direct response to the
advertisement to "order now." Telebrands is a classic example of direct response
retailing. Times shopping India is another example.

(E)Automatic Vending: Although in a very nascent stage in India, is the ultimate

in non personal, non store retailing. Products are sold directly to customers/buyers
from machines. These machines dispense products which enable customers to buy
after closing hours. ATM's dispensing cash at odd hours represent this form of non
store retailing. Apart from all the multinational banks, a large number of Indian
banks also provide ATM services, countrywide.

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(F)Electronic Retailing/E-Tailing: Is a retail format in which retailers

communicate with customers and offer products and services for sale, over the
internet. The rapid diffusion of
internet access and usage, and the perceived low cost of entry has stimulated the
creation of thousands of entrepreneurial electronic retailing ventures during the last
10 years or so. Amazon.com, E-bay and Bazee.com HDFCSec.com are some of the
many e-tailers operating.

THE WHEEL OF RETAILING

Is a hypothesis that attempts to explain the emergence of new retailing institutions

and their eventual decline and replacement by newer retailing institutions? Like
products retailing institutions also have a life cycle.

According to this theory new retailers enter the market as, low margin, low price,
low status institutions. The cycle begins with retailers attracting customers by
offering low price and low service. Over a period of time these retailers want to
expand their markets and begin to stock more merchandise, provide more services,
and open more convenient locations. This trading up process. Increases the
retailers costs and prices, creating opportunities for new low price retailers to
enter the market.

The evolution of the department store illustrates the "wheel of retailing" theory. In
its entry phase, the department store was a low cost-low service venture. With time
it moved up into the trading-up phase. It upgraded its facilities, stock selection,
advertising and service. The same department store then moves into the
vulnerability phase, because it becomes vulnerable to low cost/low service
formats, such as full line discount stores and category specialists. Figure 1.5
illustrates this theory. While the wheel hypothesis has a great deal of intuitive
appeal and has been borne out in general by many studies of retail development, it
only reflects a pattern. It is not a sure indicator of every change, nor was it ever
intended to describe the development of every individual retailer.

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RETAILING DECISIONS

There are many factors for retailers to consider while developing and
implementing their marketing plans. Among the major retailing decisions are these
related to (a) Target markets (b) Merchandise management (c) Store location (d)
Store image (e) Store personnel (f) Store design (g) Promotion, and (h) Credit and
collection

Target Markets: Although retailers normally aim at the mass market, a growing number are
engaging in marketing research and market segmentation, because they are finding it
increasingly difficult to satisfy everyone. Through a careful definition of target markets,
retailers can use their resources and capabilities to position themselves more effectively and
achieve differential advantage. The tremendous growth in number of speciality stores in
recent years is largely due to their ability to define precisely the type of customers, they want
to serve.

Merchandise Management: The objective here is to identify the merchandise that

customers want, and make it available at the right price, in the right place at the right
time. Merchandise Management includes (i) merchandise planning (ii) merchandise
purchase, and (iii) merchandise control. Merchandise planning deals with decisions
relating to the breadth and depth of the mix, needed to satisfy target customers to
achieve the retailers return on investment. This involves sales forecasting, inventory
requirements, decisions regarding gross margins and mark ups etc. Merchandise
buying involves decisions relating to centralized or decentralized buying, merchandise
resources and negotiation with suppliers. Merchandise Control: deals with maintaining
the proper level of inventory and protecting it against shrinkage (theft, pilferage etc.).

Store Location: Location is critical to the success of a retail store. A store's tradingarea is the area surrounding the store from which the outlet draws a majority of its
customers. The extent of this area depends upon the merchandise sold. For example
some people might be willing to travel a longer distance to shop at a speciality store
because of the unique and prestigious merchandise offered. Having decided on the
trading area a specific site must then be selected. Factors affecting the site include,
traffic patterns, accessibility, competitors' location, availability and cost and population
shifts within the area.

Store Image: A store image is the mental picture, or personality of the store, a retailer
likes to project to customers. Image is affected by advertising, services; store layout,
personnel, as well as the quality, depth and breadth of merchandise. Customers tend to
shop in stores that fit their images of themselves.

Store Personnel: Sales personnel at a retail store can help build customer loyalty and
store image. A major complaint in many lanes of retailing, is the poor attitude of a
salesperson. There is a growing trend now, to provide training to , these sales clerks to
convert them from order takers to effective sales associates.

Store Design: A store's exterior and interior design affect its image and profit
potential. The exterior should be attractive and inviting and should blend with the
"
store's general surroundings. The term Atmospherics" is used to refer to the retailer's
effort at creating the right ambience. Merchandise display is equally important. An
effective layout guides the customer though the various sections in the store and
facilitates purchase.

Promotion: retail promotion includes all communication from retailers to consumers

and between sales people and customers. The objective is to build the stores image,
promote customer traffic, and sell specific products. It includes both, personal and non
personal promotion. Personal communication is personal selling - the face to face
interaction between the buyer and the seller. Department stores and speciality stores,
emphasize this form of promotion. Non personal promotion is advertising. The media
used are TV, Radio, Newspapers, Outdoor displays and direct mail, other forms of
promotion include, displays, special sales, give always and contests etc.

Credits & Collections: Retailers are generally wary of providing credit, because of
additional costs-financing accounts receivables, processing forms and bad debts etc.
But many customers prefer some form of credit while purchasing. This explains the
popularity of different types of credit cards and debit cards.
EMERGING TRENDS IN RETAILING

In recent years the nature of retailing has changed dramatically, as firms try to protect
their positions in the market place. Many customers are no longer willing to spend as
much time on shopping as they once did. Some sectors of retailing have become
saturated, several retailers are operating under high levels of debt and number of
retailers after running frequent "sales", have found it difficult to maintain regular
prices.

Retailers are adapting to*the shopping needs and time constraints of working women,
dual earner households and the increased customer interest in quality and customer
service:

Shopping Malls: A growing number of shopping malls are coming up all over the
country. In north India; there seems to be a proliferation of such malls surrounding
Delhi, in places like Gurgaon and Noida. In general they target higher income
customers, with their prestigious specialty shops, restaurants and department stores.

Factory Outlets: Manufacturers are opening factory outlets to sell off surplus
inventories and outdated merchandise. This forward vertical integration gives
'
manufacturers greater control over distribution, than selling the merchandise to off
price retailers. Mohini knitwear of Ludhiana (Punjab) and number of woolen and
hosiery manufacturers set up their outlets in Delhi during winters.

Non Store Retailing: Non store retailing is accelerating at a faster rate than in store
retailing. This includes direct marketing. In Home shopping TV shopping and e-tailing
etc.

Diversification

of

Offerings:

Scrambled

(unrelated

products

or

services)

merchandising is taking on a broader meaning and inter type competition among

retailers is growing. For instance Citibank is organizing tourist trips and sending mail
order catalogues to its credit card customers.

Impact of Technology on Shopping Behaviors: The way retailers present their

merchandise and conduct their transactions are changing. Cable TV Channels are used
to present merchandise, Videos have replaced catalogues and computer linkages to
acquire information and make purchases are on the increase. Virtual shopping through
PDA's is another possibility.

Multi Channel Retailing: Traditional store based and catalogue retailers are placing more
emphasis on their electronic channels and evolving into multi channel retailers, because they
can reach new markets and overcome limitations posed by traditional formats.

Retailing formats in India

Malls:
The largest form of organized retailing today. Located mainly in metro cities, in proximity to
urban outskirts. Ranges from 60,000 sq ft to 7,00,000 sq ft and above. They lend an ideal
shopping experience with an amalgamation of product, service and entertainment; all under a
common roof. Examples include Shoppers Stop, Piramyd, Pantaloon..

Specialty Stores:

Chains such as the Bangalore based Kids Kemp, the Mumbai books retailer Crossword,
RPG's Music World and the Times Group's music chain Planet M, are focusing on specific
market segments and have established themselves strongly in their sectors.

Discount Stores:
As the name suggests, discount stores or factory outlets, offer discounts on the MRP through
selling in bulk reaching economies of scale or excess stock left over at the season. The
product category can range from a variety of perishable/Non-perishable goods

Department Stores:
Large stores ranging from 20000-50000 sq. ft, catering to a variety of consumer needs.
Further classified into localized departments such as clothing, toys, home, groceries, etc.

Hypermarts/Supermarkets:
Large self service outlets, catering to varied shopper needs are termed as Supermarkets.
These are located in or near residential high streets. These stores today contribute to 30% of
all food & grocery organized retail sales. Super Markets can further be classified in to mini
supermarkets typically 1,000 sq ft to 2,000 sq ft and large supermarkets ranging from of
3,500 sq ft to 5,000 sq ft. having a strong focus on food & grocery and personal
sales.examples Big Bazar, Reliance hypermart.

Convenience Stores:
These are relatively small stores 400-2,000 sq. feet located near residential areas. They stock
a limited range of high-turnover convenience products and are usually open for extended
periods during the day, seven days a week. Prices are slightly higher due to the convenience
premium.

 MBOs :
Multi Brand outlets, also known as Category Killers, offer several
single product
category. These usually do well in busy market places and Metros.

brands across a

INTRODUCTION
Reliance Group
The Reliance Group, founded by Dhirubhai H. Ambani (1932-2002), is India's largest private
sector enterprise, with businesses in the energy and materials value chain. Group's annual
revenues are in excess of US$ 66 billion. The flagship company, Reliance Industries Limited,
is a Fortune Global 500 company and is the largest private sector company in India.
Backward vertical integration has been the cornerstone of the evolution and growth of
Reliance. Starting with textiles in the late seventies, Reliance pursued a strategy of backward
vertical integration - in polyester, fibre intermediates, plastics, petrochemicals, petroleum
refining and oil and gas exploration and production - to be fully integrated along the materials
and energy value chain.
The Group's activities span exploration and production of oil and gas, petroleum refining and
marketing, petrochemicals (polyester, fibre intermediates, plastics and chemicals), textiles,
retail, infotel and special economic zones.
Reliance enjoys global leadership in its businesses, being the largest polyester yarn and fibre
producer in the world and among the top five to ten producers in the world in major
petrochemical products.
Major Group Companies are Reliance Industries Limited, including its subsidiaries
and Reliance Industrial Infrastructure Limited.

PROFILE OF COMPANY :

Reliance Retail, Ltd. operates retail outlets in India. Its retail outlets offer foods, groceries,
apparel and footwear, lifestyle and home improvement products, electronic goods, and farm
implements and inputs. The companys outlets also provide vegetables, fruits, and flowers. It
focuses on consumer goods, consumer durables, travel services, energy, entertainment and

leisure, and health and well-being products, as well as on educational products and services.
The company was founded in 2006 and is based in Mumbai, India. Reliance Retail, Ltd.
operates as a subsidiary of Reliance Industries, Ltd.

Headquarters :
Industry

Bombay Area, India

: Retail

Type

: Public Company

Status

: Operating Subsidiary

Company Size: 10,001 or more employees

Founded

: 2006

FOUNDER PROFILE

"Growth has no limit at Reliance. I keep revising my vision. Only when you can dream
It,
you
can
do
it."
Dhirubhai
Founder
Chairman
December 28, 1932 - July 6, 2002

H.
Reliance

Ambani
Group

Dhirubhai Ambani founded Reliance as a textile company and led its evolution as a global
leader in the materials and energy value chain businesses.
BOARD OF DIRECTORS OF RELIANCE INDUSTRIES LIMITED

Mukesh D. Ambani Chairman &

Managing Director

Nikhil R. Meswani Executive Hital

R.
Director
Executive Director

Meswani

H.S.Kohli
Executive
Director

INDUSTRY PROFILE
Industry Profile
Retail Industry in India
Retail industry as of June 2013

Introduction
The Indian retail industry has been thrown open to foreign majors and is packed with players
who strive to offer great products and value-for-money to Indian consumers. The country
holds vast promise for retailers with its burgeoning spending power and rising middle class.
The US$ 500 billion market, growing at an annual rate of about 20 per cent, is largely
dominated by small shops and stores as of now. The organised segment is in its nascent stage
and has huge potential to harness in the sub-continent. Foreign giants like Wal-mart and
IKEA have recently received the Governments nod to enter the Indian market, after making
all the necessary compliances.
Market Size

Indias retail market is majorly dominated by the unorganised sector. Organised

segment accounts for 8 per cent of the total retail landscape, according to a study by
Booz & Co and RAI.

The Indian retail industry has expanded by 10.6 per cent between 2010 and 2012 and
is expected to increase to US$ 750-850 billion by 2015, according to another report
by Deloitte. Food and Grocery is the largest category within the retail sector with 60
per cent share followed by Apparel and Mobile segment.

The foreign direct investment (FDI) inflows in single-brand retail trading during April
2000 to December 2012 stood at US$ 95.36 million, as per the data released by
Department of Industrial Policy and Promotion (DIPP).

Online Retail
Internet is the buzzword in India these days. People have online access 24x7 through their
laptops, iPads and mobile phones. As a result they have continued access to online retail
markets as well.
Online retailers are emerging as important sales channels for consumer brands in India as
more and more people, especially the young generation, are shopping online. From apparel to
accessories, kids and infants product lines and almost everything under-the-sun is available
on the net these days. Apparel and accessory brands, such as Puma, Nike and Wrangler, have
recorded a big increment in online sales in 2012, led largely by purchases from smaller towns
and cities with consumers paying the full price for these products.
For instance, footwear brand Nike has tie-ups only with online retailers such as Myntra and
Jabong. And in a very unique initiative, it recently launched its new range of cricket gear on
Jabong. Such partnerships turn out to be very successful as online retailers provide greater
visibility than a physical store. "Our online store can carry around 10,000 options, while an
offline store can carry only 20 per cent of a given range," said an official.
Online retail in India is projected to grow to US$ 76 billion by 2021, accounting for over 5
per cent of the Indian retail industry, according to a report by advisory services firm
Technopak. This forecast is encouraging more companies- big and small- to sell aggressively
online. Experts believe that much of this growth will come from the rising purchasing power
of consumers in smaller cities, who do not have access to brick-and-mortar stores stocking
high-end brands.
Retail Industry: Key Developments and Investments

Kottayam, in Thiruvananthapuram, is an emerging market for luxury cars. BMW has

launched its mobile showroom in the city wherein people can check-out the brands
models and go-in for a test drive as well. A weather-proof and air-conditioned
structure, the mobile showroom is a replica of BMWs luxurious dealerships.

Hindustan Unilever (HUL), India's largest packaged consumer goods firm, will soon
launch the country's first liquid laundry detergent, hoping that wealthy consumers will
not be hesitant to pay a premium for a product that promises to make their laundry
chore easier. The company claims that the new product removes stains two times
better than any other detergent powder in the market. With 90 per cent penetration in
the core detergent space, HUL is trying to create newer consumption opportunities in
the over Rs 15,000 crore (US$ 2.51 billion) laundry market with niche and premium
products including Comfort fabric conditioner and Rin liquid blues in the post-wash
segment.

Villeroy & Boch AG, the Germany-based bath, wellness and tableware firm, has
partnered with Delhi-based Genesis Luxury Fashion to commence its operations in
single-brandretail trade in India. Villeroy & Boschs application, seeking 50 per cent
equity in the joint venture (JV) company for single-brand retail trade, has recently got
a nod from the Foreign Investment Promotion Board (FIPB). The FDI infusion in the
JV would be to the tune of Rs 1.12 crore (US$ 187,463.60). Genesis Luxury Fashion,
that has brands such as Paul Smith, Bottega Veneta, shoe brand Jimmy Choo, Italian
label Etro and Armani and home and personal care products from Crabtree and
Evelyn under its business in India, will exclusively manage the distribution of
Villeroy & Boch tableware products in the country. The alliance ensures the
establishment of a distribution network through the opening of Villeroy & Bochs
exclusive retail stores in India.

In a bid to tap the branded footwear market in India, which is estimated to be about Rs
30,000 crore (US$ 5.02 billion), Aero Group (known for its flagship Woodland brand)
is planning to revive one of its old brands, Woods. The company is contemplating to
open around 30 new, revamped Woods stores in 2013. The eight-year-old brand would
now lay its focus on the fashion quotient, rather than the typical outdoor, rough and
tough image of Woodland, and will have more of the range for women.

RP-Sanjiv Goenka Groups company Spencers Retail is on an aggressive growth

strategy, with a focus on hyper-format stores. The company intends to infuse about Rs
600 crore (US$ 100.46 million) in setting up new stores and come out with branded
and co-branded products in the food and beverage segment. One of the official
spokesperson from the company revealed that Spencers would set up 80 hyper stores
in the next 48 months. As of now, the company has 132 stores, including 26 hyper
stores, 14 super market and 92 daily (convenient) stores.

Godrej Interio, the furniture retailing arm of Godrej Group, is aiming for Rs 5,000
crore (US$ 837.14 million) of turnover by 2016-17, with plans to invest over Rs 300
crore (US$ 50.23 million) to expand manufacturing capacity and retail stores. The
company is planning to set up more than 75 stores in 2013 itself with focus on tier II
and III cities. The Indian branded furniture market is worth about Rs 10,000 crore
(US$ 1.67 billion) out of which Godrej Interio accounts for 15 per cent of the share.
The company also plans to establish 200 speciality stores which will design and built
products according to the consumer's convenience and preference.

Government Initiatives

The Cabinet Committee on Economic Affairs (CCEA) has recently approved Swedish
furniture retailer IKEA's application to enter the Indian industry and set up a single brand
retail venture in the country. FDI would be to the tune of Rs 10, 500 crore (US$ 1.76 billion),
making it the largest investment to be made by a foreign brand in the Indian retail sector.
Moreover, the Government may further simplify investment norms in multi-brand retail to
please foreign retailers who intend to invest in India but are a little hesitant on certain clauses.
Mr Anand Sharma, the commerce and industry minister, has re-iterated that any FDI proposal
in multi-brand retail will be fast-tracked for sure.

Road Ahead
The overall Indian retail sector is expected to grow 9 per cent in 2012-16, with organised
retail growing at 24 per cent or three times the pace of traditional retail (which is expected to
expand at 8 per cent), according to the report by Booz & Co and RAI.
Deloitte also seconds this forecast and expects that organised retail, which constitutes eight
per cent of the total retail market, will gain a higher share in the growing pie of the retail
market in India. Various estimates put the share of organised retail as 20 per cent by 2020.

Meaning of Retail
The word RETAIL is derived from the French word RETAILLIER, meaning to cut piece
off or to break bulk. Retailing in India is as old as India itself.

Definition: Retail is the sale of goods to end user, not do resale, but for use and consumption
by the purchaser. The retail transaction is at the end of supply chain manufacturer sell large
quantities of products to retailers, and retailers sell small quantities of those products to
consumers.
Philip Kotler defines retailing as:
All activities involved in selling goods or services to the final customer for personal use in
todays scenario our retailer does not exist in the brick and mortar from alone. She/he can do
it by using the telephone, by direct mails, by using the Internet or absolute impersonally by
using vending machines.

Evolution of the Indian Retail Sector

Traditionally retailing in India can be traced to

The emergence of the neighbourhood Kirana stores catering to the convenience of

the consumers.

Era of Government support for rural retailing: Indigenous franchise model of store
chains run by Khadi & Village Industries Commision.

1980s experienced slow change as India began to open up economy.

Textiles sector with companies like Bombay Dyeing, Raymonds, S Kumars and
Grasim first saw the emergence of retail chain.

Later Titan successfully created an organized retailing concept and established a series
of showrooms for its premium watches.

Post 1995 onward saw an emergence of shopping center.

Mainly in urbran areas, with facilities like car parking.

Emergence of hyper and super markets trying to provide customers with 3 Vs- Value,
Variety, Volume.

Major Players in Indian Retail Industry:

Shoppers Stop

Westside

Pantaloons

Lifestyle

Crossword

Wills Lifestyle

RPG Retail (Spencers, Music world)

Globus

Ebony Retail Holdings ltd.

International retailers:
There has been greater influence of brands like Wal-Mart, Tommy Hilfiger, Carrefour, Marks
& Spencers, Nike, etc in the big cities of India for long.

COMPANY PROFILE
Reliance in retail
Reliance Retail Limited (RRL) is a subsidiary of Reliance Industries Limited, which is based
in Mumbai. RRL was set up in 2006 and marks the foray of the Reliance Group into
organized retail. RRL has been conceptualized to include growth for farmers, vendor
partners, small shopkeepers and consumers. It is based on Reliances backward integration
strategy, to build a value chain starting from farmers to consumers.
Business Divisions
Reliance Retail Ltd. has a number of company-owned outlets along with a franchisee format
that would be in collaboration with Kirana shop owners. Its various divisions are:
a) Reliance Mart
It is designed to be an all under one roof supermarket that again caters to household needs.
b) Reliance Fresh
It was the first amongst various format stores to be launched by Reliance Retail Ltd. The
ideology behind the initiative has been to bring Farm to fork thereby removing middle men
and benefitting both farmer and consumer. The stores would typically be of an area of around
3,000-5,000 sq ft. Each store is to provide fresh fruits, vegetables and also products of
Reliance Select and other related groceries.
c) Reliance Super
It will be a smaller version of the hypermarket format. It is to offer over 10,000 products in
various categories like grocery, home care, stationery, pharmaceutical products, apparels &
accessories, FMCG, consumer durables & IT, automotive accessories and lifestyle products.

Reliance Super stores are to be large supermarkets with an area of 4,000 to 10,000 sq. ft. and
will not sell fruits and vegetables like Reliance Fresh.

d) Reliance Digital
It is a consumer electronics concept mega store. It is designed to be a one stop shop for all
technology solutions in the field of consumer electronics, home appliances, information
technology and telecommunications. The stores are to cover an area of more than 15,000 sq.
ft. and offer a variety of over 4,000 products spread across 150 brands along with solution
bundles to meet diverse customer needs. The staff will counsel and guide customers not only
to buy products but also provide complete solutions to ensure consumers buy the right
product at the right price. It will continue to offer Reliance One, a common membership and
loyalty program across all formats, which follows the philosophy Earn Anywhere, Spend
Anywhere. It shall also provide finance options for purchases. Reliance Digital is to be a
large format store spread across 15,000 to 35,000 sq. ft. and is scheduled to come up in 70
cities in India in the near future.

e) Reliance Wellness
It is a chain of specialty wellness stores that would offer pre-emptive, curative as well as
health and beauty solutions. The store is to add value to peoples lives, by providing products
and services that will proactively work to enrich peoples body, mind and spirit. It is to house
world class products under one roof and also educate consumers on their health needs, thus
enabling them to take charge of their health. It will sell international and national brands like
H2O, Neutrogena, Olay, Sports Nutrition, etc. They will also house alternate medicine, health
books & music. The stores are to showcase Wellness Events, Seminars, Workshops and
Advisory camps on contemporary wellness issues like diabetes, hypertension, fitness, diet
and nutrition, weight management and skin care.

f) Reliance Footprints
It is a specialty footwear store that would offer over 25,000 pairs of formal, casual, ethnic,
party wear and sports wear in men, women and children footwear. The store is to be spread
over 7,500 square feet and be dedicated to footwear, handbags and accessories. The design of
Footprint was conceptualized by Pavlik of USA which is one of the best design houses in the
world keeping in mind the taste and preferences of the Indian consumer. It shall offer brands
from Europe and America like Josef Siebel, Rockport, Hush Puppies, Lee Cooper Clarks,
Levis, Nike, Adidas, Piccadilly, Dr. Scholls and more. For kids, Crocs and Disney will be
showcased. The store plans a pan-India presence by opening over 15 more specialty stores.
g) Reliance Jewels
It is a stand-alone fine jewellery format. It is to be a one stop shopping destination for fine
jewellery. Reliance Retail ventured into gems and jewellery trade with the aim of launching
300 stores all over India within a 3 year time frame. With a growing demand for jewellery
and lower competition. The gold jewellery range shall include Kolkata Filigree, Rajkot
minakari jewellery, Kundan from Jaipur, Temple jewellery from Kerala, Jadau from Amritsar
and more. In Diamond jewellery, Reliance Jewels will offer the finest quality of diamonds
and the widest range of daily wear, party wear and wedding designs.
h) Reliance Timeout
With over 56,000 products Reliance Timeout will offer customer an extensive range of
merchandise in books, music, stationery, toys and gifts. It is to a format based on the ideology
to provide a place where a consumer can unwind and relax, browse and buy a book, sample
some music, choose a gift, and buy a toy or some exclusive stationery for themselves.
Reliance Timeout will offer a comprehensive range of products in these categories along with
an attempt to create a fascinating customer experience with a warm, lively ambience.

i) Reliance Trends
It is a specialty apparel store that will sell men, women and childrens garments. The store
will carry the best of national and international brands like John Players, Peter England,
Indigo Nation, Wrangler, Reebok, and Lee, apart from in-house brands. The store layout is to
compliment the evolving taste and preference of fashion savvy consumers, giving them an
opportunity to view /shop with ease, along with well trained customer service associates, to
compliment the entire shopping process. Reliance trends is operation with 123 stores across
the country, providing employment to so many people and planning to launch many new
stores.

ACTIVITIES GROUPS WITHIN THE STORES

Getting Products to Shelf
1) Indenting & Purchase Orders (POs)
(a)Indenting DC Delivery:-

Indenting will be happen after checking stock in the store and goods in transit. Or whenever
if required any changes in indenting due to season, weekends or any festivals then the
quantity is modified. For branded goods there is a automatic indenting system which is
handled by the head office (Mumbai). Delivery of fruit & vegetables is after 48hours after
being raised. Indenting for milk and dairy products is delivered after 36 hours.
(b) Raising PO for Bakery
PO (purchase order) for bakery supply is raised in the store and also released to the vendors
by the stores. PO on vendors can be raised only once each day & it will be valid for 24 hours.
2) Receiving:(a) Checking of Delivery in DC

All the Dry DC delivery will be checked by a store staff in the DC staging area before
packing and loading. This is to minimize delivery count error and ensure that right quantity is
delivered to the stores. Behind this all the activity owner is Store Manager.
(b) Receiving Goods in Store: From DC & CPC
Receiving indented goods from the DC & CPC as per the delivery schedule. At the time of
receiving goods from DC many things which is followed by the SM, ASM,& CSA:

Check the seal in front of driver.

Note down the air condition temperature.
Inspect stocks for transit damages.
If any HU (Handling unit) / article is found damaged, excess, or missing noted it on

the trip sheet for return to DC.

Do the GRN (Goods return note) for the delivery for the actual received quantity.
Stores are not unloading transit damaged stocks. Transit damages will be returned to
DC in the same delivery truck.
The main focus during goods receiving must be to unload the crates/ cartons from the
truck as quickly and safely as possible.
(c) Receiving from Vendors

Procedure for receiving goods directly from vendors. Behind this whole activity owner is
store manager/ asst. store manager. Reliance fresh stores indenting specially bakery, beverage
and books/magazines and music. SM/ASM Checks:-

 Check the deliveries for quantity, damages and freshness and accept only good
products as per shelf life norms.
Do not accept any short shelf life or damage quantity from vendor and reduce it from
the invoice if required.
Remove all expired products from the shelf and get them replaced with fresh product
without any GRN for the same.
In case of books/magazines and music SM/ASM check bar-codes on the books or
music CDs delivered by the vendor & return the unsold items to the vendors.
Vendors and store staff check physically check DSD deliveries for damages and

freshness and accept only fresh saleable products.

3) Replenishment of goods
(a) Replenish Shelf from Goods Receiving Area
Process of moving goods from goods receiving area to the respective bays/freezers/chillers as
per the priority fill rule.

Frozen products received must have first priority for stacking in the Freezers.
Strictly follow FIFO
Place previous stock in the front/top of the shelf.
Chilled product received must have second priority after frozen product for stacking
in the chillers.

4) Managing Price Changes

(a) Changing SELs for those SKUs where price has been changed. All the changing
of SKUs is done by headquarter Mumbai.
5) Managing Planogram
Implementation of changes of Planogram
The Planogram indicates the location for each SKU on a shelf. This process describes how to
change Planogram. Changing of Planogram is wholly managed by headquarter. Headquarter
send new Planogram to store by mail. Changing of fixtures and shelf heights, at
per new Planogram. The major change of shelf is less than 5 bays. Check quality of stock
received as per Planogram, raise an indent of additional stock if required. Stack goods as per
Planogram and readjust SEL to align with the left hand side of the first facing going from the
left. All the changes made on shelf to be signed off by store manager. All the Planogram to be

provided in standard format. Planogram indicate shelf heights. Planogram is send to the store
at least 2 days in advance of the change. No stock to be displayed on the shelf if it not in the
Planogram. If the F& V section looks empty in the late evening because of stock outs, then
store manager may change only the F& V Planogram in a suitable manner to give appearance
of full store.
6) Getting Products from Shelf to customers
(a) Promotion management (setting up the store for new promotions)
Store check that all new promotional stock has been received from the DC and the
free gift under promotional offer are bundle along with the promotional stock. If the
free gift is too large to be accommodated on the shelf the gift should be provided to
the customer at the till.
Put up new promotional signage above the end cap at the marketing defined locations.
ASM/SM briefs the staff at the morning and afternoon meeting on the promotion
details.
Staff need to be briefed on the following :
Details of the promotion
Period of the promotion
Advantages to the customer
Any special arrangements at the till
Sales target for the promotion
Process for dealing with left over promotion stock
If the customer brings the promotion item back for exchange / refund the customer
has to bring back the free offer as well. Exception can be made at the customers
favour at discretion of store manager.
7) Stock Display Management
Filling up the gaps on the shelves for SKU sold during the day is defined as spot fill.
Fill F&V in a similar manner using crates stored in the bottom shelf of the wall racks,
below heapers and in back room. Follow FEFO, FIFO rules.
In case of F&V, remove the old crates, place the new crates on the racks and then
place the older products on top of the newer products FIFO
Checking of temperature of chillers and freezers is also a part of SDM.
It is the process of checking and moving stocks to ensure that the older stock gets sold
before the newer ones.
FEFO / FIFO to be followed for stock rotation for non F&V SKUs.

 The thing which is strictly followed is removal of damaged part of the F&V will not
be carried out at the shop floor under any circumstances.
In every store every day employees check for date code check schedule for the day in
store perform.
Employees removed expired products from the shelves and take them to the back of
the store.
Employees identify & segregate near expiry products for mark down as per
markdown policy and guidelines.
Procedure for selling loose staple products to the customer in desired quantity.
Procedure for managing the concessionaire in our stores like the Pickles counters,
Sweet counters etc.
Home delivery: for this there is some procedure which is followed by stores.
Purchase a detailed street map of the local area e.g. Eicher
map
Outline on the map the catchments which fall in 2 Km radius
of the store.
Prepare a list of roads / building with in that area.
They appoint two employees for Home delivery champions
(HDC) for order taking, picking and billing.
Home delivery associate (HDA) billing and delivery.
There is two type of home delivery which is given by the RF:
Convenience order this is a situation in which the customer
has come to the store, picked items, got them billed and then
request RF store team to deliver to his residence. The payment
in this case for the goods has already been received.
Phone Orders - This is a situation in which the customer
does not carry out the activities of physically picking, billing
etc. but places an order on phone by calling either at the store
or at the call centre. The payment in this case would be
received once the delivery CSA goes to the customer
destination and hands over the goods.
Big orders store hire auto, rickshaws & it is decided by
store manager.
8) Managing waste and markdowns :
(a) Segregation of damaged and expiry in store :-

(a) For F&V crates are received carefully for the item not for sale as per reliance retail
quality and are removed from the shelf.
(b) It is done by CSA / F&V champion.
EXPIRY:(a) Near expiry product is markdown as per the RR rule.
(b) An expired product is segregated and are treated as per following.
PRODUCT TYPE
DSD supply

TREATMENT
Exchange with fresh stock from the vendor
at the time of next delivery
Dump in store.

DC supply

(b)Markdown for damages and near expiry:Damaged and near expiry products are markdown as per the following rules:
Markdown criteria:Up to Rs. 15 or 15 % of selling price (whichever is lower) & it is done by Store manager.
Up to Rs 30 or 30% of SP(whichever is lower) & it is also done by DM / AM.
Beyond Rs 30 or 30% of SP & it is done by state fresh head.

Dumping of damages & expiry product:- Treatment for damaged & expired product are
done in following manner:Loss type
(a) Type C damage
(b) All expiry (DC supply & DSD
without RTV)
(c) Expiry (DC supply with RTV)

Action

Dump in store (shown in SAP)

Dispose in store.
Dump in system (SAP)
Display in store
Exchange with fresh stock, fresh
vendor at the time of next delivery

For processing of dump (damaged & expired) approval is obtained from store
manage.
After dumping, all the dump are entered into dump register in the presence of SM
with his /her signature.
The entire dumped product is then get hand overed to garbage collection agency.
For type C damaged product some part of each product is kept as proof.
Finally the dump register is present near DM/AM for approval (signature).
(c)Dump on arrival:-

 On arrival of goods (F&V stock received from DC) poor quality goods are
segregated.
It is kept in separate place in the store with the sticker dumped on arrival not
for sale along with receiving date.
And the respective SM is informed.
In the GRN (goods received roles) for the delivery, poor quality stocks are
entered as Damaged Quality.
Further it is kept for inspection and area F&V executive is informed. E-mail is
send to the F&V head / F&V category head.
Finally dumped stocks are hand over to garbage agency.
In case the GRN is done at the back end maintain a record of the DUA and also
record the some on the invoice that is sent to the commercial team.
(9) Returns:(a) Goods Return to DC: A finalized list of good stock article for return to DC is obtained from state
merchandising team.
According to the list stock of articles are segregated and are moved to the
back office.
Return schedule is obtained from the state merchandising team and packing
of goods carton are planned.
They are packed properly. Food and non-food items are packed separately.
And GRDC is created in SAP for the quality to be returned.
Finally it is loaded and dispatched to DC in DC truck and return to DC
documents is get signed by the truck driver and is kept with itself.
(b) Goods Return to Vendor: Stocks which are to be returned to vendor are taken out to the back room..
DSD returns are segregated as per category guidelines.
Return to vendor document is created in the store.
Returns are loaded to the vendors vehicle.
2 copies of vendor document are made and is got signed by the vendor.
One copy is issued to the vendor and 2nd copy is filled as record.
Security control register for returns are updated regularly
(c) Physical verification of stock: All PI documents present in the system are checked and closed.
Stocks take checklist is updated.
It is managed with DC to ensure that there is no afternoon or evening delivery
on the stocks count day.
Following are checked and ensure:(i)
GRN for all DC deliveries have been prepared.
(ii)
GRN for all DSD deliveries have been completed.
(iii)
All damaged products (type c ) have been dumped.
(iv)
All expiry product have been dumped.
(v)
PI documents for stocks take is generated.
(vi)
HHTs are managed and ensured that they working properly etc.

(d) Stocks count and reconciliation: Objective of the count, the layout of the stores and the process are briefly
explained to the staff.
For stock count staffs are delivered for counting of articles in fixtures and for
entering the count in the HHT.

(i)
(ii)

Back of store store take

SKUs by weight (F&V, loose staples, etc)
Each loose article are weighed separately and quantity stickers are pasted.
It is continued until all SKUs are weighed.

SKUs by count:(i)
Product variants are segregated. Number of units are counted and stickers are
pasted with the quality on SKUs.
(ii)
It is continued until all the SKUs are not counted.
(iii)
PI count in the HHT is opened (all PI document together) and quantity is entered
after scanning the EAN / article code of the SKUs from the product in the HHT PI
document.
(iv)
It is continued in this manner till all the SKUs in the back of store is counted and
the quantity is entered in the PI documents with the help of HHT.
(e) Store Opening :(i)
Store shutter is opened.
(ii)
Burglar alarm is put off.
(iii)
Entry for collection of keys and store opening details are recorded in the
register kept at the security.
(iv)
Lights are switched on and all the equipments are checked for working made.
(v)
Generators are checked for water level, engine oil and Diesel.
(f) Store closing:(i)
Announcement is made for store closing 10 min before closing.
(ii)
No. of tills to be closed or operated fully depends upon the no. of customer in
the store.
(iii)
Ensure that no customer is present inside the store.
(iv)
POS & EDC closure process is performed.
(v)
It is checked that equipment is in order or not after which the store is closed.
(vi)
Security guard is got to put paper seal on safe and almirah.
(vii) All air-conditioners are switched off except server room a/c (which must be
maintained between 22-24 degree c )
(viii) Display lights and faade lights are switched off.
(ix)
Back room lock is sealed with a paper seal.
(x)
Burglar alarm in the store is updated and key register is signed in.
(xi)
Finally shutters are locked.
On the sales floor-stock take:(i)
Counting and weighing of bays are started, and quantity or count stickers are
pasted.
(ii)
PI documents are opened , EAN/ article code on the products are scanned using
the HHT and the counted number is entered.

(iii)
(iv)
(v)
(vi)
(vii)
(viii)
(ix)
(x)
(xi)
(xii)

Similarly all the SKUs shelves and bays counted on sales floor and the count entry
is entered in the PI document.
Control sheet for the fixtures that has been counted are updated.
Once all the articles in the store are counted and count entry is done in the HHT ,
post the count data by pressing the post count button in the HHT only.
HHT would display the list of SKUs for which count has been not entered then the
article in the store is looked upon and count is updated in case the article is present
in the store and count entry was missed earlier.
The final counted data is posted once again by pressing the post count button.
Success log is checked to ensure that all the PI documents are successfully posted.
The stock take report is generated is SAP and inventory differences is listed.
In case of major variations record is performed and the count in the PI document
is changed and the count is reported.
The variation is checked and confirmed and then the difference is posted by
posting the PI documents in ZSTORE, using the Post option under Phy inv.
Post in the physical inventory menu.
The stock take check list lifted in the store.

Challenges facing the Indian Organized Retail sector :

The challenges facing the Indian organized retail sector are various and these are stopping the
Indian retail industry from reaching its full potential.

I) Changing Consumer Purchasing Patterns:

The behaviour pattern of the Indian consumer have undergone a major change. This has
happened for the Indian consumer is earning more now, western influences, women working
force is increasing, desire for luxury items and better quality. He now wants to eat, shop, and
get entertained under the same roof. All these have lead the Indian organized retail sector to
give

more

in

order

to

satisfy

the

Indian

customer.

II) Lack of Retail Space:

With real estate prices escalating due to increase in demand from the Indian organized retail
sector, it is posing a challenge to its growth. With Indian retailers having to shell out more for
retail

space

it

is

effecting

there

overall

profitability

in

retail.

III) Shortage of Trained Man Power:

The Indian retailers have difficultly in finding trained person and also have to pay more in
order to retain them. This again brings down the Indian retailers profit levels.

IV) Poor Supply Chain

It is the supply chain that ensures to the customer in all the various offerings that a company
decide for its customers, be it cost, service, or the quickness in responding to ever changing
tastes

of

the

customer.

The infrastructure in India in terms of road, rail, and air links are not sufficient. This make a
poor supply chain and companies have to depend upon warehousing
Reliance retail ltd has 18 distribution centres across India.
It maintains its warehouse through WMS (Warehouse management system).
FD08:
It warehouses FMCG,GM products.
Area 65,000sq.ft
Dispatch Value-22-23crores per month(approx.)
Value of DC-7crores(approx..)
Transportation cost-20 lakhs per month(approx)
DR08:
It warehouses GM,dairy products and Reliance private label.
Area 55,000sq.ft
Dispatch Value-2-3crores per month(approx.)
Value of DC-5.5crores(approx..)
Transportation cost-10 lakhs per month(approx)
CPC:
It warehouses fruits and vegetables.
Dispatch Value-20-30lakhs per day(approx.)

Transportation cost-10 lakhs per month(approx)

Operations in Distribution centre

FD08
Five functions of Warehousing

Inbound
Outbound
Transport
MIS,QA
Flowthrough (fast moving items)

INBOUND:
Setting up the appointment for PO through telecalling and email.
PO-9 Series(flow through),4 series(put away)
First step of inbound is creating the VRN(Vehicle recognition
number) for the vehicles.
Second step of inbound is creating ASN (Advance shipping
notification) by using SAP.
ASN is created by checking 5 points which are called as the
panchanamas.
After creating the ASN we will print out the labels.
At the receiving dock for 4 series products the GRN (Goods receipt
note )will be created and only then the products are accepted.
For the 9 series products, they are brought into the dc and then the
GRN is created at the flow through point.
Once the GRN and the receiver note is created then the process
ends for the vendor.
The merchandize would be detected using RF and then its put away
in the racks first in the bin and then in the buffer.
WORKS CARRIED OUT
Created VRN
Created ASN
Helped in put away for 9 series(break pack)
OUTBOUND
There are two stages in outbound
Picking up the SKUs based on indent raised by the store.
Sorting out the products according to stores requirement at
outbound area.
From outbound staging area, the goods are ready for loading.
WORKS CARRIED OUT
Picked up SKUs
TRANSPORT
FD08 caters to 69 stores within and outside of Karnataka.
It caters to 35-36 stores per day.

It has the service of 18 vehicles

According to the picking schedule the transport is done in 1 st WAVE
and 2nd WAVE.
On time delivery is the main target of Transport team.

MIS,QA
The main function of inventory management is to decide on the
stock and to decide how much stock has to be bought
The main target of the inventory management is to reduce the
dump as much as possible.
The DC follows Kaizen and 5s(sort, set in order, shine, standardise,
sustain).
When the cargo arrives, a quality check is performed, if the products
are not up to the mark the merchandise is rejected by DC.
DR08
The DR08 distribution centre warehouses the general merchandise,
frozen, diary, chocolate.
They cater products from DC to stores and from DC to DC across
India.
Along with the general merchandise the DR08 warehouses the
private label.
Private label-It is the Hub movement (i.e) DC to DC movement.
General merchandise and the frozen products are store movement.

Four functions of Warehousing

Inbound
Outbound
Transport
MIS,QA

INBOUND:
Setting up the appointment for PO through telecalling and email.
First step of inbound is creating the VRN (Vehicle recognition
number) for the vehicles.
Second step of inbound is creating ASN (Advance shipping
notification) by using SAP.
ASN is created by checking 5 points which are called as the
panchanamas.
After creating the ASN we will print out the labels.
At the receiving dock for the products the GRN (Goods receipt note)
will be created and only then the products are accepted.
Once the GRN and the receiver note is created then the process
ends for the vendor.
The merchandize would be detected using RF and then its put away
in the racks first in the bin and then in the buffer.

The private label products would be putaway and stored at Y121

Hub.

WORKS CARRIED OUT

Created VRN
Created ASN
Helped in put away the GM products.
OUTBOUND
There are two stages in outbound
Picking up the SKUs based on indent raised by the store.
Sorting out the products according to stores requirement at
outbound area.
From outbound staging area, the goods are ready for loading.
WORKS CARRIED OUT
Picked up SKUs
TRANSPORT
DR08 caters to 92 stores within and outside of Karnataka and cold
room caters to 60 stores.
It caters to 35-36 stores per day.
It has the service of 10 vehicles
According to the picking schedule the transport is done.
On time delivery is the main target of Transport team.
MIS,QA
The main function of inventory management is to decide on the
stock and to decide how much stock has to be bought
The main target of the inventory management is to reduce the
dump as much as possible.
The DC follows Kaizen and 5s(sort ,set in order, shine, standardise,
sustain).
When the cargo arrives, a quality check is performed, if the products
are not up to the mark the merchandise is rejected by DC.

CPC
The CPC distribution centre warehouses fruits and vegetables.
They cater to 92 stores across and outside of Karnataka

Six functions of Warehousing

Inbound

Outbound
Transport
QA
Commercial
NRL Vendor management

COMMERCIAL
Setting up the appointment for PO through national vendors and
local vendors.
First step is creating the VRN(Vehicle recognition number) for the
vehicles.
Second step is creating ASN (Advance shipping notification) by
using SAP.
ASN is created by checking 5 points which are called as the
panchanamas.
After creating the ASN we will print out the labels.
INBOUND/OUTBOUND
At the receiving dock for the products the GRN (Goods receipt note )
will be created and only then the products are accepted.
Quality check is performed for the SKUs according to the reliance
quality chart.
Once the GRN and the receiver note is created then the process
ends for the vendor.
The merchandize would be detected using RF and F&V are sorted
manually or by machines.
After sorting they are allocated according to the stores indent.
WORKS CARRIED OUT
Created VRN
Created ASN
Picked up SKUs
TRANSPORT
CPC caters to 92 stores within and outside of Karnataka.
It caters to 92 stores per day.
It has the service of 28 vehicles
According to the picking schedule the transport is done every day.
On time delivery is the main target of Transport team as all the
goods mostly perishable.
MIS,QA
The main function of inventory management is to decide on the
stock and to decide how much stock has to be bought
The main target of the inventory management is to reduce the
dump as much as possible.

The DC follows Kaizen and 5s(sort, set in order, shine, standardise,

sustain).
When the cargo arrives, a quality check is performed, if the products
are not up to the mark the merchandise is rejected by DC.

NRL VENDOR MANAGEMENT

The cargo rejected by the DC will be sold to local vendors as non
reliance label.
This is done to reduce the dump.