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“A COMPARATIVE STUDY ON BUYING BEHAVIOUR OF

CONSUMER FOR INDIGENOUS PRODUCT vis-à-vis


INTERNATIONAL PRODUCT”
Submitted for the partial fulfillment of the requirement for the award
Of
POST GRADUATE DIPLOMA IN MANAGEMENT
SUBMITTED BY
PRAVIN TRIPATHI
PGDM 1 2OO8-10 BATCH
Department of management
INSTITUTE OF MANAGEMENT EDUCATION,

CONTENT

ABSTRACT

CHAPTER 1- INTRODUCTION, NEED OF STUDY,


BACKGROUND

CHAPTER 2- RESEARCH METHODOLOGY

CHAPTER 3- DESCRIPTIVE WORK OF SUB TOPICS

CHAPTER 4- DATA ANALYSIS AND INTERPRETATION


CHAPTER 5- CONCLUSION & SUGGSESTION

BIBLIOGRAPHY

ANNEXURE-

DECLARATION

We the students of PGDM IST year, 2ND


semester of INSTITUTE OF MANAGEMENT EDUCATION,
SAHIBABAD, Ghaziabad, 2008-10 batch, hereby declare that the
Winter Project Report titled “A COMPARATIVE STUDY ON
BUYING BEHAVIOUR OF CONSUMER FOR INDIGENOUS
PRODUCT vis-a-vis INTERNATIONAL PRODUCT” is the
outcome of our own work and the same has not been submitted by
any Institute for the award of any degree or any Professional
diploma.

Date:
----------------------------
PRAVIN TRIPATHI

ABSTRACT

The first and most objective of our study is comparative study of


consumers buying behavior regarding indigenous and imported
products. The study of consumer behavior is the most important
factor for marketing of any goods and services. The consumer
behavior suggest how individual, groups and organization select,
buy, use and dispose of goods, services, ideas or experience to
satisfy there needs and wants. It also clues for improving or
introducing products or services, setting price, devising channels
etc.
Since liberalization 100% FDI is allowed in India. This has
attracted foreign companies to penetrate the Indian market. The
marketers always look for emergent trends that suggest new
marketing opportunities and here in India a lot of opportunities
are available.

ACKNOWLEDGEMGNT

This Project Report is the fruit of our intense hard work and

dedication during our project work. We wish to express our sincere

gratitude to our project supervisor Mr. SIDDHARTH VARMA for

his esteemed guidance during the course of project work. We are

grateful to her for giving us an insight into the realm of Buying

consumer Behaviour on National and International product . In

spite of her busy schedule, she was always available whenever we

required help .
CHAPTER (I)

INTRODUCTION
INTRODUCTION

As a consumer we are all unique and this uniqueness is reflected in


the consumption pattern and process purchase. The study of
consumer behavior provides us with reasons why consumers differ
from one another in buying using products and services. We
receive stimuli from the environment and the specifics of the
marketing strategies of different products and services, and
responds to these stimuli in terms of either buying or not buying
product. In between the stage of receiving the stimuli and
responding to it, the consumer goes through the process of making
his decision.

Stages of the Consumer Buying Process:


Six Stages to the Consumer Buying Decision Process (For complex
decisions). Actual purchasing is only one stage of the process. Not
all decision processes lead to a purchase. All consumer decisions
do not always include all 6 stages, determined by the degree of
complexity...discussed next.
The 6 stages are:

1. Problem Recognition--difference between the desired state


and the actual condition. Deficit in assortment of products.
Hunger--Food. Hunger stimulates your need to eat.
Can be stimulated by the marketer through product
information--did not know you were deficient? I.E., see a
commercial for a new pair of shoes, stimulates your
recognition that you need a new pair of shoes.
2. Information search--
o Internal search, memory.
o External search if you need more information. Friends
and relatives (word of mouth). Marketer dominated
sources; comparison shopping; public sources etc.

A successful information search leaves a buyer with possible


alternatives, the evoked set.

Hungry, want to go out and eat, evoked set is

o Chinese food
o Indian food
o burger king
3. Evaluation of Alternatives--need to establish criteria for
evaluation, features the buyer wants or does not want.
Rank/weight alternatives or resume search. May decide that
you want to eat something spicy, Indian gets highest rank etc.
If not satisfied with your choices then return to the search
phase. Can you think of another restaurant? Look in the
yellow pages etc. Information from different sources may be
treated differently. Marketers try to influence by "framing"
alternatives.
4. Purchase decision--Choose buying alternative, includes
product, package, store, method of purchase etc.
5. Purchase--May differ from decision, time lapse between 4 &
5, product availability.
6. Post-Purchase Evaluation--outcome: Satisfaction or
Dissatisfaction. Cognitive Dissonance, have you made the
right decision. This can be reduced by warranties, after sales
communication etc.
After eating an Indian meal, may think that really you wanted
a Chinese meal instead.

Types of Consumer Buying Behavior


Types of consumer buying behavior are determined by:

• Level of Involvement in purchase decision. Importance and


intensity of interest in a product in a particular situation.
• Buyers level of involvement determines why he/she is
motivated to seek information about a certain products and
brands but virtually ignores others.

High involvement purchases--Honda Motorbike, high priced


goods, products visible to others, and the higher the risk the higher
the involvement. Types of risk:

• Personal risk
• Social risk
• Economic risk

The four type of consumer buying behavior are:

• Routine Response/Programmed Behavior--Buying low


involvement frequently purchased low cost items; need very
little search and decision effort; purchased almost
automatically. Examples include soft drinks, snack foods,
milk etc.
• Limited Decision Making--Buying product occasionally.
When you need to obtain information about unfamiliar brand
in a familiar product category, perhaps. Requires a moderate
amount of time for information gathering. Examples include
Clothes--know product class but not the brand.
• Extensive Decision Making/Complex high involvement,
unfamiliar, expensive and/or infrequently bought products.
High degree of economic/performance/psychological risk.
Examples include cars, homes, computers, education. Spend
a lot of time seeking information and deciding.
Information from the companies MM; friends and relatives,
store personnel etc. Go through all six stages of the buying
process.
• Impulse buying, no conscious planning.

The purchase of the same product does not


always elicit the same Buying Behavior. Product can shift from one
category to the next. For example:
Going out for dinner for one person may be extensive decision
making (for someone that does not go out often at all), but limited
decision making for someone else. The reason for the dinner,
whether it is an anniversary celebration, or a meal with a couple of
friends will also determine the extent of the decision making.
Factors Effecting the Consumer Buying Decision Process
A consumer, making a purchase decision will be affected by the
following three factors:

1. Cultural and sub culture Factor


2. Social Factor
3. Personal Factor

• Culture and Sub-culture--

Culture refers to the set of values, ideas, and attitudes that are
accepted by a homogenous group of people and transmitted
to the next generation.
Culture also determines what is acceptable with product
advertising. Culture determines what people wear, eat, reside
and travel. Cultural values in the US are good health,
education, individualism and freedom. In American culture
time scarcity is a growing problem that is change in meals.
Big impact on international marketing.

Culture can be divided into subcultures:

o geographic regions
o Human characteristics such as age and ethnic
background.

West Coast, teenage and Asian American.

Culture affects what people buy, how they buy and when they
buy.

Understanding Consumer Buying Behavior offers consumers


greater satisfaction (Utility). We must assume that the company has
adopted the Marketing Concept and are consumer oriented.

Social Factors
Consumer wants, learning, motives etc. are influenced by opinion
leaders, person's family, reference groups, social class and culture.

• Roles and Family Influences--

Role...things you should do based on the expectations of you


from your position within a group. People have many roles.
Husband, father, employer, employee. Individuals role are
continuing to change therefore marketers must continue to
update information. Family is the most basic group a person
belongs to. Marketers must understand:

o that many family decisions are made by the family unit


o consumer behavior starts in the family unit
o family roles and preferences are the model for
children's future family (can reject/alter/etc)
o family buying decisions are a mixture of family
interactions and individual decision making
o Family acts an interpreter of social and cultural values
for the individual.

The Family life cycle: families go through stages; each stage


creates different consumer demands:

• Reference Groups--

Individual identifies with the group to the extent that he takes


on many of the values, attitudes or behaviors of the group
members.

Families, friends, sororities, civic and professional


organizations. Any group that has a positive or negative
influence on a persons attitude and behavior.
Membership groups (belong to)
Affinity marketing is focused on the desires of consumers
that belong to reference groups. Marketers get the groups to
approve the product and communicate that approval to its
members. Credit Cards etc.!!

Aspiration groups (want to belong to)


Disassociate groups (do not want to belong to)
Honda, tries to disassociate from the "biker" group. The
degree to which a reference group will affect a purchase
decision depends on an individuals susceptibility to reference
group influence and the strength of his/her involvement with
the group.
• Social Class

An open group of individuals who have similar social rank.


US is not a classless society. US criteria; occupation,
education, income, wealth, race, ethnic groups and
possessions.

Social class influences many aspects of our lives. i.e; upper


middle class Americans prefer luxury cars Mercedes.

o Upper-upper class, .3%, inherited wealth, aristocratic


names.
o Lower-upper class, 1.2%, newer social elite, from
current professionals and corporate elite
o Upper-middle class, 12.5%, college graduates,
managers and professionals
o Middle class, 32%, average pay white collar workers
and blue collar friends
o Working class, 38%, average pay blue collar workers
o Lower class, 9%, working, not on welfare
o Lower-lower class, 7%, on welfare

Social class determines to some extent, the types, quality, and


quantity of products that a person buys or uses.

Lower class people tend to stay close to home when


shopping; do not engage in much pre-purchase information
gathering.
Stores project definite class images.

Family, reference groups and social classes are all social


influences on consumer behavior. All operate within a larger
culture.
Personal Factor Unique to a particular person. Demographic
Factors, Sex, Race, Age etc. Who in the family is responsible for
the decision making? Young people purchase things for different
reasons than older people.

Psychological factors

Psychological factors include:

• Motives-

-A motive is an internal energizing force that orients a person's


activities toward satisfying a need or achieving a goal. Actions
are effected by a set of motives, not just one. If marketers can
identify motives then they can better develop a marketing mix.
MASLOW hierarchy of needs!!

o Physiological
o Safety
o Love and Belonging
o Esteem
o Self Actualization

Need to determine what level of the hierarchy the consumers


are at to determine what motivates their purchases. The
product was not selling well, and was almost terminated.
Upon extensive research it was determined that the product
did sell well in inner-city convenience stores. It was
determined that the consumers for the product were actually
drug addicts who couldn't digest a regular meal. They would
purchase Nutriment as a substitute for a meal. Their
motivation to purchase was completely different to the
motivation that B-MS had originally thought. These
consumers were at the Physiological level of the hierarchy.
BM-S therefore had to redesign its MM to better meet the
needs of this target market.
Motives often operate at a subconscious level therefore are
difficult to measure.
• Perception—
Perception is the process of selecting, organizing and
interpreting information inputs to produce meaning. IE we
chose what info we pay attention to, organize it and interpret
it.
Information inputs are the sensations received through sight,
taste, hearing, smell and touch.

Selective Exposure-select inputs to be exposed to our


awareness. More likely if it is linked to an event, satisfies
current needs, intensity of input changes (sharp price drop).

Selective Distortion-Changing/twisting current received


information, inconsistent with beliefs.

Advertisers that use comparative advertisements (pitching


one product against another), have to be very careful that
consumers do not distort the facts and perceive that the
advertisement was for the competitor. A current
example...MCI and AT&T...do you ever get confused?

Selective Retention-Remember inputs that support beliefs,


forgets those that don't.
Average supermarket shopper is exposed to 17,000 products
in a shopping visit lasting 30 minutes-60% of purchases are
unplanned. Exposed to 1,500 advertisement per day. Can't be
expected to be aware of all these inputs, and certainly will not
retain many.

Interpreting information is based on what is already familiar,


on knowledge that is stored in the memory.
• Ability and Knowledge--

Need to understand individual’s capacity to learn. Learning,


changes in a person's behavior caused by information and
experience. Therefore to change consumers' behavior about
your product, need to give them new information re:
product...free sample etc.

When making buying decisions, buyers must process


information.
Knowledge is the familiarity with the product and expertise.
Inexperience buyers often use prices as an indicator of quality
more than those who have knowledge of a product.
Non-alcoholic Beer example: consumers chose the most
expensive six-pack, because they assume that the greater
price indicates greater quality.

Learning is the process through which a relatively permanent


change in behavior results from the consequences of past
behavior.

• Attitudes--

Knowledge and positive and negative feelings about an object


or activity-maybe tangible or intangible, living or non
living.....Drive perceptions

Individual learns attitudes through experience and interaction


with other people. Consumer attitudes toward a firm and its
products greatly influence the success or failure of the firm's
marketing strategy.

Honda "You meet the nicest people on a Honda", dispel the


unsavory image of a motorbike rider, late 1950s. Changing
market of the 1990s, baby boomers aging, Hondas market
returning to hard core. To change this they have a new slogan
"Come ride with us".

Attitudes and attitude change are influenced by consumer’s


personality and lifestyle.

Consumers screen information that conflicts with their


attitudes. Distort information to make it consistent and
selectively retain information that reinforces our attitudes. IE
brand loyalty.

There is a difference between attitude and intention to buy


(ability to buy)

• Personality--

all the internal traits and behaviors that make a person


unique, uniqueness arrives from a person's heredity and
personal experience. Examples include:

o Work holism
o Compulsiveness
o Self confidence
o Friendliness
o Adaptability
o Ambitiousness
o Dogmatism
o Authoritarianism
o Introversion
o Extroversion
o Aggressiveness
o Competitiveness.
Traits affect the way people behave. Marketers try to match
the store image to the perceived image of their customers.

There is a weak association between personality and Buying


Behavior; this may be due to unreliable measures. Nike ads.
Consumers buy products that are consistent with their self
concept.

• Lifestyles--

Recent US trends in lifestyles are a shift towards personal


independence and individualism and a preference for a
healthy, natural lifestyle.

Lifestyles are the consistent patterns people follow in their


lives.

The marketer must be aware of these factors in order to develop an


appropriate MM for its target market.

1.1 What is Marketing?

Marketing on the one hand is a business philosophy and on the


other an action oriented process. The philosophy - also termed as
marketing concept - has its roots in market economy. There are
four critical ideas that form the foundation of such an economy:
Individuals pursue their self-interest to seek rewarding
experience
Their choices determine as to what would constitute such
experience, the choices themselves being shaped by personal
(taste) and external (cultural) influences.
Consumers enjoy the freedom to choose; they are sovereign.
This freedom ensures free and competitive exchange between
“buyers and sellers”. Marketing in turn is based on these four
principles.
Thus Marketing can be defined as a

‘Process that aims at satisfying individual and organizational


needs by creating, offering and exchanging competitively made
products that provide value to the buyers’

Today our focus is on customer. Objectives liken revenue, profit,


market share, etc. Re important, but they will flow only by
acquiring customer competence. In our country particularly the
customer, even as late as in 1980s, was bereft of alternatives; he
would uncomplainingly buy whatever the seller dished out. Not
any more. Today’s choice empowered customer, supported by a
competitive environment, global quality, and new economic
realities, decides the fate of the marketer.
So let’s define Marketing once more: “It is a total business
philosophy aimed at identifying the needs of each customer group,
then designing and producing product / service package so as to
serve the groups more effectively than the competitors”.
This definition reveals three key dimensions of marketing:
· It seeks to identify customer needs: Many manufacturers would
know all there is to know about relevant production technology,
but nothing about their customers’ wants. They may design
products with fancy features without considering the perceived
value of such features to their
buyers. Then they wonder why their sales staff fails to push the
product in the market.
Marketing attempts to select customer groups for which it can
develop a competitive edge: · Companies taking a shotgun
approach - meaning all things to all people - inevitably end up with
sackful of unsold product inventories.
What is Consumer Buying Behavior?
Definition of Buying Behavior: Buying Behavior is the decision
processes and acts of people involved in buying and using
products.

Need to understand:

• Why consumers make the purchases that they make?


• What factors influence consumer purchases?
• Changing factors in our society.

Consumer Buying Behavior refers to the buying behavior of the


ultimate consumer. A firm needs to analyze buying behavior for:

• Buyer’s reactions to a firms marketing strategy has a great


impact on the firm’s success.
• The marketing concept stresses that a firm should create a
Marketing Mix (MM) that satisfies (gives utility to)
customers, therefore need to analyze the what, where, when
and how consumers buy.

Marketers can better predict how consumers will respond to


marketing strategies.

NEED OF THE STUDY –

There are different national & international products present in


India. So to identify the customer & their buying behavior have been
the focus of a number of international and national product. The
result of these studies have been useful to the provide solution to
various marketing problem.
Understanding buying behavior pattern per se is not enough without
understanding the composition and origin of the customer. Today
most of the Indian customers are attracted by the imported goods
because of their high quality. So that most of the Indian company
product looses their credibility and loyalty in domestic customers.
So the objectives of the study are –
1. How can we stand out in a highly competitive market
where consumer have so many choice?.
2. How we can provide best loyalty to our customer
while earning a fair profit?
3. How can we grow our business while retaining a core
of the loyal customer?

BACK GROUND: A major area of concern in marketer-consumer


relation is the growing influence and utilization of the credit market,
an outcome of compulsive buying, which has negatively affected the
consumers, leading them to unmanageable debt levels. A study to
find whether there is any association of the following variables on
compulsive buying viz, big five Personality traits, materialism,
demographics and credit card usage. The research design is a
conclusive design which is single cross sectional descriptive in
nature. The primary data was collected using non probability
sampling technique. A quota sample of 120credit card holders
(using credit card/s above one year) was chosen.
The respondents in aggregate ‘neither agree nor disagree’ to
materialism and have ‘rarely’
compulsive buying. The respondents ‘moderately agree’ that they
are high enhanced credit card spenders, but at the same time they
‘rarely’ indicate compulsive buying, which is a positive outcome.
They ‘disagree’ to high credit card financing behavior, which again
exposes to the fact that they ‘spent and finance their spending’
cautiously, keeping track of mental account4 as a self control
device against environmental factors, like retailing environment,
availability of credit and so. Emotional stable extroverts tend to
have a steady spending behaviour and external influences do not
impact much, is true in this study. Twelve percent of respondents
have ‘high credit default probability’, with a score between 5 to
10on the scale.
The emergence of relationship in some cases is as supported by
literature from previous studies at the same time poses a challenge
before the researcher to take up complicated models (like
structural equation modeling) to possibly explore a new direction to
the nature of relationships.

CHAPTER (II)
RESEARCH METHODOLOGY

OBJECTIVE OF THE STUDY

The systematic and objective identification, collection, analysis,


dissemination, and use information for the purpose of assisting
management in decision making related to the identification and
solution of problem and opportunities in marketing.
When an industry comes in the
competitive market then the main problem comes in front of him
is, how can survive in the market. For this purpose they have to
know about their production process, employment process,
distribution process, consumer needs and consumer behavior. The
main purpose of the industry is to satisfy the consumer needs.
Their all function rounds around the customer, they try to know the
behavior of the customer and fulfill their goal and to know about
the customer’s behavior they do marketing research. In this era the
marketing research is the basic part of the industry. Marketing
research include the evaluation of the organization’s all functions
like their production, manufacturing, distribution, marketing ,
financial and human resources.
We can say it is the internal research of an industry. There are some
external factor which affects the growth of the organization like
customer behavior and the political, technological, economical, and
legal environment. And the most important factor is consumer
buying behavior because this factor is responsible for the
utilization of the product and ultimately sells of the product. So
industry also needs the research on the consumer buying behavior.

When we do the research on the consumer behavior we


should know the entire factor which affects the consumer buying
behavior. Social environment, education, culture and traditions,
income, society are the factors which affect the buying behavior of
the consumer. We can also divide it into geographic, demographic,
psychological factor. The main objective of this study are –
 To under stand why customer buy a particular product.
 To know the marketing opportunities.
 To know about customer acceptance of the product.
 To analyse the customer expectation from the manufacturer.
 To help the company to know what consumer want in the
product.
 Why consumer prefer imported goods instead of indigenous
goods.

In the marketing research we firstly design our research.


Our research can be Descriptive, explorative and casual research
design.
Casual research design is based on survey and observation. In this
research process we are selected descriptive research design.

RESEARCH METHODOLOGY

Research problems: To study buying behavior of


consumer for indigenous and imported products.

Data source: Primary data and secondary data

Research approach: Survey approach

Research methodology: Exploratory method

Research Instruments: Questionnaire

SAMPLING PLAN

Population Definition
Sample: Malls ,Super Mark
Extent: Delhi/NCR

Sample Methods Random Simple Sampling


Sample size 75.
Primary data Questionnaire and Interview

SAMPLE

While deciding about the sample of research, it is required


from the researcher’s point to pay attention to these under
mentioned points:
a) Sample Units: A decision has to be taken concerning
a sampling unit before selecting a sample, sampling
unit may be a geographical one such as state, district,
village Etc. so in this research sampling unit is
Delhi/NCR.
b) Source list: It is also called sampling frame from
which sample is to be drawn ,it caters name of all the
items of a universe (in case of finite universe
only).Researcher has to prepare it
c) Sampling size: This refers to the no. of items to be
selected from the universe to constitute a sample.
This is a major problem before the researcher. The
size of sample should neither be excessively large
not too small, it should be optimum. This size of
population must be kept in view for this also limits
the sample size .Sample size in this research is 75
customers.
d) Sampling procedure: Finally the researcher must
decide the type of sample he must be .That is he
must decide about the technique to be used in
selecting items for the sample .In fact this technique
or procedure stands for the sample design itself. In
this we used the random sampling on the basis of
first survey results, which is from 75 respondents.

INSTRUMENTS USED

We collected primary data through sample survey or


census surveys from the selected elements in malls and
super markets. So for this purpose we have used the most
popular tool of primary data collection through direct
communication with respondents. The tools we used are
questionnaires.

Source of data: Data required for the study was collected


through primary sources i.e. Market Survey.

METHOD OF DATA COLLECTION

Actually data is of two kinds so researchers should keep in


mind both types of data.
a) Primary Data: Primary data are those, which are
collected afresh and for the first time and this happen to
be original in character.
b) Secondary Data: Secondary data are those data which
have already been collected by someone else and which
have already been used as per required.
There are basically two sources to collect secondary data
a) Internally: Provided by the company/organization
b)Externally: Various publication of central, state and
local Government.
• Books, magazines, newspapers
• Internet
After only keeping in mind one can think about what type
of data has to be collected during research as our research is
concerned we have to gather primary data for Customer
behavior

QUESTIONNAIRE

This method is more popular .The questionnaire is sent to


the person concerned to answer the questions formatted and
return the same soon.
A Questionnaire consists of a number of questions printed
or typed in definite order on a form or set of forms. The
Questionnaire is sent to the respondents. In order to achieve
the research objective it is necessary to collect accurate and
relevant data, secondary data are already published data
collected for purposed other than the specific research
needs at hand.
Primary data that are collected specifically for the research
situation at hand, were collected by surveys ,using
respondents surveys is one of the ways of collecting
primary data namely observations, experiments and surveys
.
Limitation

Every project faces some limitation; because of this


limitation the required
And necessary data to complete the project may not gather
in proper manner. The limitations which we observe were
as follows:
• With respect to actual population the sample size was
too small. This might be effect the final result.

• Since the responses were only from some part of


Delhi, the report cannot be generalized for whole
Delhi and NCR.

• Respondents may have given bias information.

• The time limit for the research was one week that was
small time to collect adequate information for
inference for the consumer buying behavior.

Discussion

As our project title is to find the market behavior of the


customer buying a Indigenous and International product.
Accomplish this project and to make report .we survey all
type of customer behavior in the market. We gather data
and after data analysis, we conclude that the market
behavior of the customer bases on the buying Indian and
International product. At a present time mostly customer
like a style and social status and brand conscious in the
society.

CHAPTER (III)
Descriptive Study

Descriptive Study

Indian market is one of the fast booming market in the world. It


attract most of the Indian and international company towards them.
Due to the globalization most of international branded company
inter in the Indian market and increase the competition between
them. There are different international competitor which are
present in the Indian market like Lee, Cotton Country, Cantabile,
Mc Donald, Dominos, Elle etc. These company try to attract most
of Indian customer. Most of the Indian people prefer imported
garment because they think imported company provided better
look and they charge lower prices but in the case of food and
cosmetic they prefer indigenous food and cosmetic.

Food and Grocery –


In a country where there is a grocery shops at every street
corner and a vegetable and fruits vender near each bus stop. How
can organized retail of food become feasible. A successful retailers
seem to have just one option, offer attractive price to the consumer.
A successful retailer wining edge will therefore come from souring
how best it can leverage its scale to drive merchandise costs down
increase stack turn and get better credit terms from its vendors.
There are obvious and hidden areas where costs are pruned and the
benefit of this lower costs of retailing can be passed on to
customers as lower prices which is turn should fuel demand. The
food supply chain in India is fuel in efficiencies a results of
inadequate infrastructure, too man middlemen, complicate, lows
and an indifferent attitude. There is little doubt that food retailing
has immense potential. During the course of this researches EITG
spoke to several players, national and international in the food
retail business.
There are different types of food retail store are available in
india market. They serve different types of indigenous and
international food to their customer. Different types of indigenous
food retail store are –
• Food Bazaar
• HaldiRam
• Bikaner
And the international retail stores are –
• Mc Donald’s
• Dominos
• Barista
• Pizza hut
• Nescafe
These are main player in the food market. These food retail stores
have captured most of the Indian market but still more Indian
customers like to eat indigenous food. They want to have local
food, that’s a main reason that most of the food retail store
emphasize on local market and they serve according to their taste.
For example Mc Donald’s franchisees say they think the new
coffee drinks will be particularly helpful in drawing young
consumer who will prefer them to drip coffee.
India’s largest publicly traded retailer, Pantaloon Retail Ltd.
will make its formal entry into the gourmet food business with its
Gourmet food Bazaar targeting those Indian with a global palate
and a wallet to match. Pantaloon will open the first 4,500 sq. ft
store in select city walk mall, an upscale new shopping mall in
south Delhi very soon. Pantallon is going to enter this in category
with store in New Delhi, Banglore and Mumbai. “We believe in
food. Also there is the customer that is ready for more lifestyle
shopping, more branded item, and more international cuisine” said
Damoder Mall, who heads the company’s ventures into new
businesses. The company operate in various formats including
department stores and hypermarkets and runs a supermarket chain
called Food Bazaar that sells discount food items from potato to
pasta. Mall decline to say how many gourmet stores the company
plans to open.
A resent report by consultant Ernst and Young says Food
and Grocery constitute almost 54% or $ 152 billion of India’s total
annual retail business but modern retailers account for just 1% of
market . A growing number of organized retailers in India have
plans to target the food market and are opening thousands of
grocery stores though out the country in coming years.
Mumbai based Hyper city Retail Pvt. Ltd. Is also planning
to launch Gourmet city next year. Hypermarket which runs a
hypermarket in Mumbai’s western suburb of Malad, has a counter
for imported cheeses, handmade chocolates, cold ,cuts, marinated
meats, a bakery and stocks gourmet food form British supermarket
Cahin , whitrose.
Godrej Agrovet Ltd also recently relaunched some of the stores
in its Nature’s Basket supermarket chain to stoke a rang of
imported food products include wine, organic pasta, wasabi,
hagenDaz ice cream etc.
Gourmet food Bazaar plans to stock Indian as well as imported
food products in the store. “There will be live bakers, lots of
cheese, sandwiches, there will be a salad bar and many imported
foreign brands will be there Mall said.”
The future Group, Pantaloon’s parent, also recently took a
stake in sula wines, a domestic wine company and now stocks Sula
wine at some of its Food Bazaar store.
So if we summarise whole thing we can say Indian
retail market is most booming industries in the country. Most of
the Indian company are interested in food industry. But according
to our sarvey most of the Indian people are like indigenous food.
Indian food has become too much popular in the United Kingdom
over the past decade and a large number of Britons now prefer to
eat out at Asian restaurants, according to a study.

Sales of not only Indian but also other Asian dishes like Chinese
and Thai have increased 36 per cent between 2001 and 2006.
Overall the fast food industry has increased its sales by 73 per cent
between 1995 and 2005, the study says.

"Food is now a key part of our leisure time and we are eating out
more often. It is no longer unfashionable to cook but this trend can
be at odds with desires for convenience or intentions to make
ethical or healthy choices.

"The popularity of convenience food snacking and eating out has


led to concerns about the demise of the family meal as well as a
decline in knowledge and skills about food (but) the majority of
family meals are still eaten together.

"Even in single person households, eating remains a social activity


with young single people tending to invite people to dinner more
often than their married counterparts," 'The Guardian' quoted the
government study of British eating habits as saying.

However, it has played down reports that Britain is not only


becoming a nation of scoffers but also getting dangerously
dependent on food from abroad.

According to the study, Britain now imports 40 per cent of the


country's food, significantly more than 10 years ago when the
European Common Agricultural Policy (CAP) rewarded farmers
for production.

"But we used to import far more between 1870 and 1939. The very
high self-sufficiency of the 1980s and 1990s was unusual -- an
artifact of the CAP. Europe is expected to provide most of our
future imports for the foreseeable future," the study says.

Garment-

The end of trade restrictions should generate unprecedented


business for developing countries - including, Bangladesh, China,
Hong Kong, India, Indonesia, Korea, Pakistan, Philippines, Sri
Lanka and Thailand. In practice, China is likely to run away with
the gold and silver prizes, leaving the other countries to fight over
the bronze.

The key will be volume-driven efficiencies combined with design


capabilities and flexibility in manufacturing. These are the factors
that have catapulted China into the biggest clothier of the world.

Not only did the quota regime protect high-wage Western


companies, the way in which it was administered in India, it also
cocooned many low-wage Indian producers who were assured of
business without being really competitive. It worked like this: a
country, say, China, could not export more than a certain number of
pieces to the US in a year - even if Americans preferred to buy
Chinese stuff for cost or quality reasons. That gave the opportunity
for less competitive players from other counties to sell their wares
in the US.

"Quotas afforded the comfort of assured business to manufacturers


and to those who held a quota, and this imparted a sense of
stability," says Rahul Mehta, managing director of Creative
Outerwear Ltd, part of the $55-million-turnover Creative group of
companies, among the biggest Indian garment exporters.

He adds: "Even inefficient manufacturers got quotas, which


assured them business, and flab crept in," he adds. Often quotas
were obtained merely for the premium, and someone else did the
manufacturing.

The Indian textile industry clearly has many advantages. India is


one of the biggest cotton producers in the world, it has a huge
market, which creates the opportunity to exploit economies of
scale, it has cheap skilled labour, and it has plenty of design skills.
Still, the country's garment industry suffers from many structural
weaknesses, unlike China's.

Till recently Indian law decreed that garment manufacturing should


remain a small-scale activity. The result: even today 80 per cent of
the country's garment makers operate from tiny outfits with less
than 20 machines per unit. A 2003 survey by the Confederation of
Indian Industry, Introspecting Competitiveness of the Textile
Sector, reveals that only 20 per cent of the manufacturers in the
Rs28,000 cr. garment sector (with seven million workers)
constitute the organized sector. Currently, 75 per cent of the
readymade garment exports, according to CMAI, are to the quota
countries.
In the post-quota regime, competition from China, Hong Kong, and
other low-cost countries with huge capacities, will force Indian
manufacturers to compete on productivity, quality and cost, which
require not just skill but scale and technology. To survive the
competitive onslaught, size will be a key determinant. The industry
will have to transform its unorganized, small-scale character to
become large, organized and capable of high-cost investments in
modern, high-speed equipment.

The garment industry being a small scale industry, not surprisingly,


when India's overall quota was distributed among exporters, the
allotments were skewed in favour of small units. Until the late
1990s, with 80 per cent of garment production coming from small-
scale units and 70 per cent of the quota being distributed on the
basis of 'past performance entitlement' (PPE) manufacturers had no
reason to expand their operations or invest in expensive equipment.
Those who did grow did so by more small-scale units, usually
making a separate garment category.

Another 15 per cent of the quota was reserved for allotment on a


'first-come, first-serve entitlement' (FSFSE) for manufacturers with
a turnover limit of Rs5 cr.. This again blocked large manufacturers
from quota entitlements. With the quota system being scrapped
from 1 January 2005, leading garment manufacturers can now
begin consolidating and expanding their capacities. Even the larger
of the existing small-scale export manufacturers, freed of the
compulsion to create small satellite units to acquire a larger share
of the prized quota, are now expanding capacities to achieve
economies of scale.

The Government's own efforts are now aimed at undoing some of


the earlier policies to encourage size and competitiveness.
Recognizing the threats of global survival post-MFA, it has
embarked on the role of an industry-friendly facilitator, with policy
measures that would help exporters.
• Garments have been removed from the list of industries
reserved for the small-scale sector
• Machinery import duty has been reduced to a nominal 5 per
cent
• Excise duty has been reduced sharply
• A textile upgradation fund scheme (TUFS) has been
introduced to provide a reimbursement of 5 per cent interest
on loans or finance charged by the lending agency on a
bankable project of technology upgradation.
• The central value added tax (CENVAT) network has been
extended to all players in the handloom, powerloom and
organized sectors.
• The small-scale industry excise duty exemption up to Rs1 cr.
has been removed.

In the meanwhile, another issue that requires resolution is the state


of poor infrastructure in India. Overseas buyers and domestic
suppliers all have their own horror tales of delayed shipments due
to the deplorable congestion at Indian ports, the sordid condition of
roads from the manufacturing centers to the shipment points
leading to consignments stranded in broken-down vehicles, traffic
choke-up at the numerous octroi collection centres â none of which
seem as acute in countries with whom India will compete post
quotas.

India also has an advantage of being the third largest cotton


producer, which lends itself to lower freight cost and shorter lead
times. Since the country also produces a variety of cottons, it
provides greater flexibility, to meet varied requirements and
arbitrage opportunities.

The per-unit cost in India is currently higher than in China but


India has the ability to counter the Chinese cost dragon through:
• Amalgamation of manufacturing units and high technology
equipment to ensure economies of scale and lower unit
prices.
• Mark-ups of 20 per cent to 25 per cent of the FOB prices,
arising out of the odious 'premium cost' to acquire quotas
from those who had them, which disappears with the
abolition of quotas.
• Reforms to reduce the 'hidden costs' - import licence, inland
freight movement, octroi malpractices, etc.

Labour cost, as a percentage of manufacturing cost in India is


already lower than in China and all India needs is to achieve higher
manpower productivity. That, of course, is easier said than done.

Major Indian companies are already expanding their capacities in


order to avail of economies of scale. Gokaldas Exports, India's top
garments exporter, has added eight factories in the past two years -
larger and more modern in terms of technology and infrastructure.
Gokaldas now has 41 factories with a workforce of 31,000 - up 30
per cent. Orient Craft, with 18,000 people on its rolls, is also
adding 30 per cent capacity, with three new factories this year and
two in 2005.In India, 95 per cent of garments makers have annual
sales of less than Rs50 cr.; and of the 16,000 export manufacturers,
only around 100 companies are able to cross the Rs100-crore sales
level per annum.

The value of Indian garment exports was Rs28,000 cr. ($5.4


billion) in the last fiscal. To achieve exports of $25 billion by 2010,
India would have to expand its manufacturing capacity five-fold;
expansion of 30 per cent by top players will just not suffice.

Harminder Sahni, associate director, KSA Technopak , however, is


quite optimistic. "China is no doubt a very large player, but most of
the customers feel over-bought in China and hence are very keen
on having a second source of supply. So it is more like China and
India in most cases. Also, US buyers are dominant in China, so EU
buyers are keener on being dominant in the Indian subcontinent.".
Anyway India, with its closer proximity to Europe, has
traditionally enjoyed a larger export share to the EU countries.

The world market share

In spite of the Chinese dominance, India has a fair opportunity to


grab a substantial stake in the projected garment market share.
According to PHD Chamber of Commerce and Industry
(PHDCCI), post-MFA, India's market share in the US is expected
to go up to 15 per cent from the present 4 per cent. In the EU, the
market share increase is expected to be 50 per cent - from the
current 6 per cent to 9 per cent.

In the more competitive and experienced world fashion markets,


buyers well understand the need for geographical de-risking - the
SARS breakout in China early this year affected the apparel
industry severely, sending buyers to build linkages with India,
Hong Kong and others. Besides, there have been incidents of
terrorist attacks, hurricanes and earthquakes, which can disrupt
supply management and hence the 'need' for better geographical
diversification.

For most buyers China may be the first choice for many, but India
comes a close second. MK Panthaki, director, Clothing
Manufacturing Association of India, says, "Whether these countries
will oblige China in the post-quota regime is a moot question."
India fails to satisfy the requirement of the fall / autumn-winter
season, when the demand for cotton fabric dips. The wool output
from the country is of low quality as the shearing and breeding of
sheeps and goats is not scientific. Though Reliance Industries is the
world's biggest polyester maker, synthetics account for just 14 per
cent of India's exports. To balance its exports between its peak
spring-summer peak demand periods, India needs to diversify into
synthetics and wool.

Garment manufacturers require more than production efficiencies


to survive in the years ahead. They need professionalism to
undertake hard-core marketing, focused and consistent positioning,
and most of all, a keen understanding of fashions and trends to
cash in on the advantage of competing in a world without quotas.

According to our survey most of the Indian people prefer


imported garment because they think imported garments provided
better look at a cheaper rate. In India there are different imported
brand are available like LEE, CANTABAIL, COTTON
COUNTRY, COUNTY LONDON etc. This is important. While the
potential to grow is immense, companies have to realise that
consumers are knowledgeable and a fancy name alone is not
enough. Until the market perception of the textile industry changes
or the companies promote a different image, returns will not
materialise from an investment perspective regardless of the
market's potential to grow.

COSMETIC-

There are different indigenous and international brands are


present in Indian market. Indian brands are-
• Hindustan Uni Liver
• Shehnaz Husain
• Ayur
And international brands are –
• GARNIAR
• ELLE
Indian people are spending most of the money on the Indian
cosmetic brand. In India there are many beauty parlor of women
and men and they charge a very high prices. But most of the Indian
people think international brand are most costly and most of the
international brand are shutted to Indian people that’s a main
reason mostly Indian people prefer Indian cosmetic product.
Indian market is one of the fast booming market in the world. It
attract most of the Indian and international company towards them.
Due to the globalization most of international branded company
inter in the Indian market and increase the competition between
them. There are different international competitors which are
present in the Indian market like Lee, Cotton Country, Cantabile,
Mc Donald, Dominos, Elle etc. These companies try to attract most
of Indian customer. Most of the Indian people prefer imported
garment and cosmetics because they think that imported company
provided better look and they charge lower prices.
CHAPTER (IV)
Data Analysis & Interpretation

DATA ANALYSIS

Table No 1 :- Persons like to go for shopping

Category No. of Respondent Percentage of Respondent


Super Market 17 24%
Mall 30 43%
Traditional Shop 11 16%
e-Shopping 12 17%

GRAPH 1

Persons like to go for shopping


E- S HOP 12

TRAD S HOP 11 E-SHOP


TRAD SHOP
MALL
MALL 30 SUP MRKT

S UP MRKT 17

Interpretation: - At a present time mostly customer like went to


the mall (43%) and customer second preference a super market
(24%) and third preference equally e-shopping and traditional
shopping (16%).

Table No 2 :- No of visit

Category No. of Respondent Percentage of Respondent


During Weekend 27 36%
Monthly 20 30%
15 – 20 days 12 18%
Rarely 11 16%

GRAPH 2

No of visit
30

20

10

0
WEEKLY MONTHL 15-20 RARELY
27 20 12 11

Interpretation: - Customers behavior went to for the shopping in


the mall, e-shopping, super market and traditional shop. only 36%
customer want go to the daringly and 30% customer monthly and
18% customer 15-20 days and 16% customer rarely go for
shopping.
Table No 3 :- Are you brand conscious

Category No. of Respondent Percentage of Respondent


Yes 47 67%
No 23 33%

GRAPH 3

Brand Conscious
NO
33%

YES
67%

Interpretation:- 67% customers said that we are a brand


conscious and only 33% customers not like a brand means that he
is not depend on branded product.

Table No 4 :- Satisfied with the brand available in market

Category No. of Respondent Percentage of Respondent


Yes 60 86%
No 10 14%

GRAPH 4

Satisfied with the brand available


70
60
50
40
30
20
10
0
YES NO

YES NO

Interpretation:- In the market 86% customers said that branded


product easy available in the market and 14% customer said that
not easy available in present market.

Table No 5 :- If yes you prefer

Category No. of Respondent Percentage of Respondent


National Brand 60 86%
International Brand 10 14%

GRAPH 5

Yes you prefer


34
NATIONAL
BRAND

36
33 33.5 34 34.5 35 35.5 36 36.5

NATIONAL BRAND INTERNATIONAL BRANR

Interpretation:- Customers behaviors buying for the National and


International product mostly like buying a National product as 86%
and only 14% customers like buying a International product.

Table No 6 :- Favors in liberalization for easy availability of


imported goods

Category No. of Respondent Percentage of Respondent


Yes 59 85%
No 11 15%

GRAPH 6

Easy availability of imported goods


60
50
40
30
20
10
0
YES NO

Interpretation:- 86% customers said that in the market easy


availability of the Imported product.

Table No 7 :- Parameters effect buying decision

Category No. of Respondent Percentage of Respondent


Quality 35 50%
Price 15 22%
Easy availability 19 27%
National/State 1 1%

GRAPH 7

Parameters buying decision


1%

27%
QUALITY
EASY AVAILABILITY
51%
PRICE
NATIONAL/STATE

21%

Interpretation:- In the market customer behavior on the bases of


the buying product mostly people prefer a quality as 51% and other
49% people buying on the bases of easy availability and price, only
1% people like a national/state.

Table No 8 :- Type of garments prefer

Category No. of Respondent Percentage of Respondent


Imported 28 40%
Indigenous 42 60%

GRAPH 8

Type of garments
IMPORTED

INDIGENOUS

0 10 20 30 40 50

Interpretation:- In the garments sector mostly like a Indigenous


product, Out of the total customer only 40% customer prefer a
International product because International garments product price
high compare to the Indian garments product.

Table No 9 :- Type of food prefer

Category No. of Respondent Percentage of Respondent


Imported 10 14%
Indigenous 60 86%

GRAPH 9

Type of food
70
60
50
40
30
20
10
0
INDIGENOUS IMPORTED

Interpretation:- Mostly customer behavior like a Indigenous food.


Out of the total customer 86% customers prefer the Indigenous
food and only 14% customer prefer a International product.

Table No 10 :- Type of cosmetic prefer

Category No. of Respondent Percentage of Respondent


Imported 28 40%
Indigenous 42 60%

GRAPH

Type of cosmetic
50

40

30

20

10

0
INDIGENOUS IMPORTED

Interpretation:- In the market 60% customer prefer a Indian


cosmetic product and only 40% customer like a International
cosmetic product.

Table No 11 :- If you prefer Indigenous product/brand what else


can be done to make them comparison with International brands?

Ans - Quality base and Price base.

Table No 12 :- If you prefer indigenous goods what fascinates


towards them?

Ans - Easy availability and Service.


CHAPTER (V)
Conclusion & Suggestion

Conclusion

As the research has shown the comparison between customer


buying behavior regarding Indian and International product in
recent time. Since the consumer buying behavior is the
important factor to forecast the sales of any product in a
particular area. So company should keep close eye on the
market situation. yet, customer were price sensitive, but the
changing market trend and customer view and preference
shown that customer are now quality sensitive .They want
quality product, good services, easy availability of product and
better performance by the product.
These days no of customer buying from malls has
been increased. Also the frequency to visit the malls has been
increased substantially. People are more brands conscious and
they are satisfied with the range of products available there.
We can conclude from our study that still more
inclination is towards indigenous product the preference ratio of
indigenous to imported products is 6 : 4.This is because of the
relatively higher price of imported product.

Suggestions
i. Customer like best quality product on any price, so company
should add latest technology to their products.

ii. After sales services is the area where Indian and International
Company can highly satisfy the existing customer, because
they can make more customer through their word of mouth.
So Indian and International Company should provide latest
and reliable service to their customers.

iii. Customer’s behavior always looks for some extra benefit


with purchasing. They demand for affordable price for
product and gifts with purchasing.

iv. International Company should make strategy to cater every


income group customers in city. Upper income group are
affordable to purchase but lower income group is not. So
International Company should make policies to send their
product and every home.

v. The Indian company should give more emphasis on


advertising to create market awareness and to make a brand
image in the minds of investors.

vi. The International Company should do more publicity through


road shows, newspaper and advertisement. As this will create
awareness about he fund and schemes that are at present
managed by the International Company.

vii. They should keep a close eye on competitor strategy.


Bibliography

News paper: - The Economic Times.

Business Standard.

Journals: - Business World, Business Today.

Website: - www.wikipedia.com
www.rbi.com
Book: - Kotler Philip , Principle of Management

Khothri C R , Research Methodology

Appendices

Questionnaire on Customer survey

Topic:-Buying behaviors consumer International & Indian


product.

Name:
Age/sex:
Profession:

1. Where do you like to go for shopping?


a) Super market b) Mall c) Traditional shop d) e-
shopping.

2. How many time you like to visit this place?


a) During weekends b) Monthly
c) 15-20 days d) rarely

3. Are you brand conscious?


a) Yes b) No

4. Are you satisfied with the variety of brand availability in the


market?
a) Yes b) No

5. If yes you prefer?


a) National brand b) International brand

6. Are you in favors of liberalization for easy availability of


imported goods?
a) Yes b) No

7. Which parameter/s effect you’re buying decisions?


a) Quality b) Price c) easy availability d)
national/ state
8. Which type of garments you prefer?
a) Indigenous b) Imported

9. Which type of food you prefer?


a) Indigenous b) Imported

10. Which type of cosmetic you prefer?


a) Indigenous b) Imported
11. If you prefer Indigenous product/brand what else can be done
to make them comparison with International brands?

………………………………………………………………

…………………………………………………………………

12. If you prefer indigenous goods what fascinates towards them.

………………………………………………………………….

…………………………………………………………………..