RETAIL MANAGEMENT

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DEFINITION OF RETAILING
Retailing is the sale of goods or commodities in small quantities directly to consumers

Retail is the sale of goods to end users, not for resale, but for use and consumption by the purchaser

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DEFINITION OF RETAIL MANAGEMENT Retail management can refer to the way business is conducted in the retail sector The stage in which goods and services are delivered to their end users.

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1.

Deciding on an appropriate mix of products and service

- a large number of items for the customers

FUNCTIONS OF RETAILING

2.

Converting larger quantities purchased into individual units

selling in smaller quantities to end consumers

3.

Holding inventory
- maintain a large variety of inventories

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GROWING IMPORTANCE OF RETAILING

Retailing has become a brand dominated activity Retailing accounts for a significant proportion of the economy It employs a large proportion of workforce Turnover is more Contribution to GDP is more Retailers play an important role in the society as employers Retailers are diversifying into various sectors 5/30/12

Factors influencing retailing

1. 2. 3. 4.

Computerisation Communication Fashion Consumerism

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COMPUTERISATION

Information technology helps retailing in delivering accurate timely information Performance and efficiency can be enhanced Helps in providing better services to the customers Due to advanced computerisation retailers are able to provide accurate 5/30/12 product mix to their customers

COMMUNICATION

Communication has made the world smaller Telephones, TVs, Satellites, internet has facilitated easy exchange of information between people

Consumers get influenced by what they see and hear not only 5/30/12 their own country but across in

FASHION

The term fashion refers to the way people live, dress, work or play over the world It varies from country to country and even region to region Radio, TV, cinema, internet etc has a great impact on fashion Fashion is of two types
Classic (fashion remains for long 5/30/12 time)Eg: Blazer

CONSUMERISM

Consumer is the king Consumer is educated and aware of what is happening around him Demand is increasing for the products

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THEORIES OF RETAIL DEVELOPMENT

1. 2.

Environmental Theory Cyclic Theory

A) The Wheel of Retailing B) The Retail Accordian Theory

C) The Retail Life Cycle Theory 5/30/12

Environmental Theory

Darwins fittest

theory

says

survival

of

the

Retail environment is made up of customers, competitors, economic, social, political, regulatory, cultural, demographic, competition, technology, fashion, legal etc. The birth, success or decline of different forms of retail enterprise is attributed to the business environment. Darwins approach says that those retailers that successfully adapt to the changes in 5/30/12 environment are the ones which grow the

In the classic phases of the wheel of retailing there are three stages Entry, trading up and vulnerability At the entry stage a retailer enters the market as a low-price , low status competitor with operating expenses reduced to minimum As the retailer becomes successful, he tradesup to improved facilities, offers enhanced services and provides additional product line etc. , therefore the cost 5/30/12 increases

Cyclical Theory- The wheel of retailing

THE WHEEL OF RETAILING

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THE RETAIL ACCORDION THEORY

The retail accordion theory suggests that retailers initially enter a market as a general retailer, with experience they focus down on particular product sectors Overtime they begin to diversify their offer in order to grow but again will revert to specialisation

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The Retail Accordion

Time

Wide Assortment Narrow Assortm ent Wide Assortment 17 17

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The retail life cycle is a theory about changes through time of the retailing outlets Retail organisations pass through identifiable stages of innovation, development, maturity and decline and this is what is commonly termed as retail life cycle

RETAIL LIFE CYCLE THEORY

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THE RETAIL LIFE CYCLE

Maturity Growth Decline

Innovatio n
Time

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CONFLICT THEORY

Conflict always exists between operators of similar formats Competition between retailers causes changes in the nature of the retail environment Retailing thus evolves through a dialectic process i.e. the blending of two opposites to create a new format Antithesis +Thesis = Synthesis
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CONFLICT THEORY
ANTITHESIS THESIS

Discount store

Department al stores

Discount Department stores

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The Indian Retail Sector

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INTRODUCTION

India today is a dynamic combination of demanding consumers, rising levels of consumption and a growing population base Retailing in India is one of the pillars of its economy and accounts for about 15% of its GDP It creates employment of 8% of the total national workforce Modern trade can be defined as any organised form of retail
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The Indian retail industry is the fifth

The Evolution of retail in India

E s t a b li s h e d f o r m E m e r g i n g F o r m a t s

T r a d i t i o n a l F o 5/30/12 r

Drivers of retail change in India

1. 2. 3. 4.

Socio-Economic factors The age factor

Changing income profiles The changing role of women and evolving family structure The changing consumption pattern Increased credit friendliness

5. 6. 7.

Geographical dispersion of market 5/30/12 potential

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FOOD AND GROCERY

SIZE: Out of 62% of Indian market only 0.8 % is the organised sector Key players: Food bazaar, Food world, Trinetra, Fresh, Spinach
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FOOD SERVICES

SIZE::

Size: Out of 57,000 crores only 3940 crores is organised sector Key Players: Mc Donalds, Dominos, Pizza Hut , KFC 5/30/12etc.

CLOTHING AND TEXTILES

Size: Out of 1,13,500 crores only 18% is from organised sector Key Players: Arvind brand, Madura garments, Raymonds etc 5/30/12

CONSUMER DURABLES

Size: Out of 41,500 crores only 4,300 crores is from organised sector Key Players: Videocon, BPL, Tatas 5/30/12

FOOTWEAR

Size: Out of 13,750 crores only 5,200 crores is from organised sector Key Players: Bata India, Metro shoes, adidas, Nike, Reebok Liberty Etc.
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JEWELLERY RETAIL

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Size: Out of 52,000 crores only 1,450 is from organised sector Key Players: Tanishq, Gili etc

BOOKS, MUSIC & GIFT RETAIL

Size: Out of 11,500 crores only 1,450 is from organised sector Key Players: Landmark, Crossword, Oxford bookstore etc
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FUEL AND PETRO RETAIL

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Size: Out of total energy consumption of the country 45% is from oil & gas sector Key Players: Essar, Shell, Reliance, Bharat petroleum, Hindustan petroleum etc

Challenges to retail Development in India

1. Retail not being recognized as an industry in India. 2. Trained manpower shortage 3. The high costs of real estate. 4. Lack of Adequate infrastructure. 5. Multiple and complex 5/30/12 taxation system.

RETAIL AS A CAREER

Buying and Merchandising Marketing Store operation Sales Finance Human resources Technology Visual merchandising
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