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A PROJECT REPORT ON

“Consumer perception towards RELIANCE FRESH Super Market.”

Submitted in Partial fulfillment of the requirement for the awards


of Master Business administration

BY
KARTHIK
2007-2010

OSMANIA UNIVERSITY, Hyderabad

CERTIFICATE BY THE GUIDE

1
This is to certify that the project work titled “A SURVEY ON
CUSTOMER’S PERCEPTION TOWARDS RELIANCE FRESH
SUPERMARKET ” is a bonofide work done by KARTHIK
[ HT no . ] of Princeton Pg College, Hyderabad under my
supervision .

Place : Name :
Date :
Designation :

DECLARATION

2
I KARTHIK hereby declare that the project report entitled “ A
SURVEY ON CUSTOMER’S PERCEPTION TOWARDS RELIANCE
FRESH SUPERMARKET ” submitted in partial fulfillment of the
requirements for the degree of “ MBA ” to Princeton Pg College is my
original work and not submitted for the award of any other degree ,
fellowship or similar titles or prize.

K
arthik.

3
ABSTRACT:
Today the entire firm engaged in a process of creating a life time value
and relationship with customers. This report start with discussion on the diversity of
Customer perception and the need for studying consumer buying behavior and consumer
as a related field of marketing .this can be largely be attributed to the prevailing market
situation .Today the company image is built and made known by its customers. Thus
success of the firm determined how effective it has been in meeting the diverse consumer
need and wants by treating each customer as unique and offering products and services to
suit has or her need.

Customer perception will be a primary force in determining how this transition will
evolve. Getting closer to the customer in today’s highly competitive landscape is
essential for the entire industry and is no longer just a retail issue. It requires all
organisations across the supply chain to work as a single enterprise, sensing and
responding rapidly to consumer demand in a co-ordinated manner. Detailed analysis of
the changing patterns of consumer demand, shopping trends.

This project report is based on to know the


1- Major factors influencing customer perception towards Reliance Fresh.

2- Buying decision process.

3- The stage in buying decision process

4- Awareness of consumer towards organised retail sector

4
ACKNOWLEDGEMENTS

First of all , I would like to express my gratitude to Mrs . Swathi


Reddy hod of Business mgmt and SISTLA SUBRAMANYAM
,PRINCIPAL OF Princeton Pg college,Hyd for their support and guidance
provided during my MBA and while doing this project . I would like to
express my thanks to the management and faculty members of MBA
Department , Princeton Pg college,Hyd- especially to my project guide
Mrs. Kavitha, for her kind cooperation and valuable guidance .

Also my thanks to customers and owners of


the supermarket who helped me to do the project work.

KARTHIK.

5
INDEX

Page
Chapter No Content No
1 Introduction
2 Objectives
3 Research and Methodology
4 Review of literature
5 Company Profile
6 Data Analysis and Interpretation
7 Findings and Suggestions
8 Conclusion
9 Bibliography
10 Annexure

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CHAPTER –I
(INTRODUCTION )

Introduction

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1.1 MEANING OF MARKETING
Marketing is the subject or thought that starts with the needs
and wants of human beings, wants are unlimited but the means
to satisfy them are limited. When a person tries to satisfy the one
need or want another arises. But basically every human being needs
air, water, food, clothing and shelter to survive. Once the people
satisfy these needs they, think of other things like recreation,
entertainment, education and other things like recreation services.
Every individual has his own fascination for some special product or a
strong preference for particular brands for their basic goods and
service. We all survive in this society by exchanging some services.
Workers render their services and earn income for the labour so
earned, they use their income for buying their goods and satisfy their
wants, companies or organization exchange their goods and services
for income and tries to use the income to bye the raw materials and
equipment to produce other goods.

Marketing is the societal process by


which individual and groups obtain what they need and want through
creating, offering and freely exchanging product and services of value
with others. The aim of marketing is to make selling superfluous. The
aim of marketing is to know and understand the customer so well that
the product and services fits him and sells itself. Marketing
management is a process of planning and executing the conception,
pricing , promotion distribution of goods and services and ideas to
create exchange target groups that satisfy customers or organizational
objective.

8
Definition of Marketing :

• Philip kotler : “Marketing is a set of human activities directed at


facilitating and consuming exchange. The essence of marketing
is the exchange of product and the transaction is to satisfy the
human needs and wants. All business activities helping and
promoting the exchange functions are included in marketing”.

• The American marketing association offers the following


definition. Marketing the process of planning and executing the
conception, pricing, promotion, and distribution of ideas, goods
and services to create exchanges that satisfy individual and
organizational goal.

• Marketing is an on going process of :

1. Discovery and translating consumer needs and desires into


products and services. (through planning and producing
the planned products.)

2. Creating demand of these products and services.( through


promotion and pricing)

3. serving the consumer goods or demand ( through planned


physical distribution) with the help of marketing channel.

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1.2 Meaning of Retailing :

Retailing plays a very vital role in the modern business. Retailer acts
as a middle man between the manufactures and the ultimate
consumer. It is he how connects both the manufactures and ultimate
user. Retailer provides all the necessary information to customers and
manufactures. He collects the information regarding the products and
give back to the manufactures so that he can produce the product
according to the customers expectations. Retailing is benefited to both
organization and customers. Retailing includes all the activates
involved in selling goods or services finally to the customers. Retailing
may include subordinate services such as deliveries. In the commerce,
a retailer buys goods or products in large quantities from manufactures
or importers either directly or to a wholesaler and then sells smaller
quantities to the end user.

Retailing consists of the final activity


needed
to place a products in the hands of consumer or to provide service to
the consumer. In fact, retailing is actually the last step in a channel of
distribution that may stretch from EUROPE TO ASIA to our home
towns. There fore any form that sells a product or provides services to
the final consumer in performing the retailing function. Regardless of
weather the firm sells to the consumer in a store, through the mail,
over the telephone, through T.V, over internet, Door to Door or through
vending machine, it is involved in retailing.

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ACTIVITY INVOLVED IN RETAILING :

1. Choosing the store location.

2. Sales promotion.

3. Store operation.

4. Inventory management.

5. Building the store as a brand.

6. Achieving efficiency in the retail operations.

Major Retailer Types :

1. Special Store

2. Departmental Store

3. Super Market

4. Convenient Store

5. Super Store

6. Discount Store

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7. Catalog Show room

Super Market :

Super market is the large retail store dealing in a wide variety of


goods under a single roof and it is a large self service shop selling
food and household goods. Mostly catering to the location and
unified control, it known for orderly arrangement of products in
separate shelves and always it lays emphasis on consumer’s
service. Super markets have high turnover and therefore able to
buy goods in high bulk. This cuts down the unit cost and in turn the
prices, which further encourages business. However, we believe
that much of the future development is likely to take place in this
type of retail outlet. This is largely because customers will have
very little time to shop around. With more women being employed,
shopping around or even just buying from a corner shop is going to
reduce. Another reason is that the customers is more assure at
product, quality and freshness when he/she buys his /her
requirements from a store like foodland. Moreover, the wide range
of products mix carried by these store make them a favorite retail
outlet.

According to PHILIP KOTLER, it is large. Low cost, low


margin, high volume, self service operation to serve total
needs for food and household maintenance product.

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STRENGTH OF SUPERMARKET FROM CONSUMER POINT OF VIEW

Supermarket tries to fulfill these expectations through the following merits:

1. It saves the time because customers will get everything at one place with self-
service.
2. It provides perfect platform for comparison of comparison of one product with
another. It also provides complete information of all brands.
3. Supermarkets are multi-brand department stores, which offer complete brand
choice to the customer.
4. Some times customers also gets discount because multi-brand stores go for bulk
purchase and pass the earning pf differences to the customer.
5. Customers get a detailed and computerized bill so that there is no possibility of
any discrepancy in billing.
6. Comfortable shopping, in terms of great ambience and convenient parking
facility, is strength of supermarkets.
7. Now-a-days services are also provided by supermarkets, like home delivery of
goods, vehicle parking etc.

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Customers :

A customer refers to individual or household who purchase


the goods and services generated within the economy. A
customer is the most important visitor on our premises. He is not
dependent on you, we are dependent on him. He is not an
interruption on work. He is the purpose of it. He is not an
outsider in our business, he is a part of it. We are not denying
any favour by serving him but he is doing a favour by providing
an opportunity to do so. As a consumer we use service everyday.
The service sector going through almost revolutionary change
which dramatically effects the way in which we live and work.
New services are being continuously launched to satisfy our
existing needs. It is a customer and he alone who though being
willing to pay for goods are services convert economic resources
is to wealth and thinks is to goods. Thus the consumer becomes
the focal point of the business or the service.

Consumer Perception :

Perception can be described as “how we see the


world around us”, two individual may be subject to the same
stimuli under the same apparent condition, but how each person
recognizes them and interprets them in the highly individual
process based on each person’s own needs, values and
expectations. Hence perception defers by individuals.

14
Thus consumers perception in his defined as the process by
which an individual selects, organizes and interprets stimuli. Into
a meaningful and coherent picture of the world.

CHAPTER –2
(OBJECTIVE AND SCOPE )

15
Objectives :

1. To know the general perception of customer towards Reliance


Fresh.

2. To know about the problems and complaint of customers.

3. To know about the service provide to customers.

Scope :

1. The study covers the customers of West Marredpally who


patronize Reliance Fresh.

2. The Scope of the study includes people of all ages.

3. The sample size is limited to only 50 i.e. number of


respondents is 50
customers.

Needs :

In the modern time competition is very severe. There are


many super markets sprouting very other day e.g., FOOD WORLD,
MORE, SPENCER,GHANSHYAM super markets, so this has made the

16
study to be done on the customer preference towards the Reliance
fresh super markets.

CHAPTER –3
(RESEARCH AND METHODOLOGY)

17
Research Methodology :

Data collection method includes primary data with the help


of questionnaire from the customers in west Marred ally.

Sources of Data :

• Primary source
Primary source is collected by questionnaire by the customer.

Tools and Techniques :

The tools and techniques use to interpret the data are PIE-GRAPH

Limitations:

1. Response received may not be free from bias.

2. This study is limited to 50 customers of West Marred ally.

3. The information given by customers is assumed to be true hence


there is a chance of bias.

4. The final conclusion was drawn primarily based on the data given
by the respondents.

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CHAPTER –4
(REVIEW OF LITERATURE)

19
1.8 LITERATURE REVIEW:

Industry analysis of the Indian retail sector:

Modern retailing has entered India in form of malls and huge


complexes offering shopping, entertainment, leisure to the consumer
as the retailers experiment with a variety of formats, from discount
stores to supermarkets to hypermarkets to specialty chains. However,
kiranas still continue to score over modern formats mostly due to the
convenience factor i.e. near to their house.
This organized segment typically comprises of a large number of
retailers, greater enforcement of taxation mechanisms and better
labour law monitoring system. It's no longer about just stocking and
selling but about efficient supply chain management, developing
vendor relationship quality customer service, efficient merchandising
and even the labour class is also in the working process timely
promotional campaigns. The modern retail formats are encouraging
development of well-established and efficient supply chains in each
segment ensuring efficient movement of goods from farms to kitchens,
which will result in huge savings for the farmers as well as for the
nation. The government also stands to gain through more efficient
collection of tax revenues. Network marketing has been growing quite
fast and has a few large players today. Gas stations are seeing action
in the form of convenience stores, ATMs, food courts and pharmacies
appearing in many outlets.
In the coming years it can be said that the hypermarket route will
emerge as the most preferred format for international retailers
stepping into the country. Estimates indicate that this sector will have
the potential to absorb many more hypermarkets in the next four to
five years

20
List of retailers that have come with new formats:

Retailer Current Format New Formats

Shoppers’ Stop Department Store Quasi-mall

Crossword Large Bookstore Corner shop

Piramyd Departmental Store Quasi-mall, Food retail

Pantaloon Own brand store Hypermarket

Subhiksha Supermarket considering moving to self service

Globus Department Store Small fashion stores

Traditionally, the kirana retailing has been one of the easiest ways to
generate self-employment, as it required minimum investment in
terms of land, labour and capital. These store are not affected by the
modern format of retailing. In order to keep pace with the modern
formats, kiranas have now started providing more value-added
services like stocking ready to cook vegetables and other fresh
produce. They also provide services like credit, phone service, home
delivery etc.
The organized retailing has helped in promoting several niche
categories such as packaged fruit juices, hair creams, fabric bleaches,
shower gels, depilatory products and convenience and health foods,
which are generally not found in the local kirana stores. Looking at the
vast opportunity in this sector, big players like Reliance has announced
its plans to become the country's largest modern retainers by
establishing a chain of stores across all major cities.
Apart from metro cities, several small towns like Nagpur, Nasik,
Ahmedabad, Aurangabad, Sholapur, Kolhapur and Amravati has seen

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the expansion of modern retails. Small towns in Maharashtra are
emerging as retail hubs for large chain stores like Pantaloon Retail
because many small cities like Nagpur have a student population,
lower real estate costs, fewer power cuts and lower levels of attrition.
However, retailers need to adjust their product mix for smaller cities,
as they tend to be more conservative than the metros. In order for the
market to grow in modern retail, it is necessary that steps are taken
for rewriting laws, restructuring the tax regime, accessing and
developing new skills and investing significantly in India.
India is rated as the most attractive retail markets

Country Market Market Time


Risk Attractiveness Saturation Pressure Rank

Country 25% 25% 30% 20%

India 62 34 91 80 1st
Russia 52 58 71 92 2nd

China 68 40 53 90 4th

Turkey 51 56 66 65 9

Thailand 64 41 59 71 12

Malaysia 70 49 58 40 18

Egypt 51 35 85 30 25

Brazil 52 56 57 20 29
India’s
Rank 24th 14th 1st 7th 1st

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Socio demographic factors will lead to faster growth of Organized
retail in India:

100% 9% 10% 11%


9% 12%
80% 19% 19% 20% 22% 23%

60% 25% 24% 24% 26% 27%


40%

20% 47% 47% 45% 42% 39%

0%
1991 1996 2001 2006E 2010E
0-19 Yrs 20-34 Yrs 35-54 Yrs 55+ Yrs

23
Pharma
Entertainment Durable 2%
1% 10%
Home
3%
Clothing and
Textile
36%
Food & Grocery
14%

Health & Beauty


1%

Books, Music &


Gifts
3% Footwear
Watch &
13%
Jewellery
17%

ORGANIZED RETAIL:

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Emerging Retail Markets:

India, Russia, China and Vietnam top the list of the most attractive
emerging markets for retailers' investment in 2007, While India and
Russia have held the top two spots since 2004, China's booming
consumer spending, together with retailers moving into second-tier
cities, helped it rise to No. 3 from its No. 5 spot last year, according to
the 2007 Global Retail Development Index from management
consultant firm A.T. Kearney.
The study based its results on four variables: 'country risk', measuring
political risk, debt and credit ratings; 'market attractiveness',
encompassing retail sales per capita, population, infrastructure and
regulations; 'market saturation'; and 'time pressure'.
The higher the ranking, the more urgency for retailers to enter the
market, according to the study, which ranks the top 30 emerging
countries for retail development and focuses on mass-merchant and
food retailers.
"If you want to be an international player in retail, these are the
markets that demonstrate the characteristics (where) you can be
successful," said Laura Gurski, a co-author of the study and partner in
A.T. Kearney's consumer and retail practice.
India has already attracted the attention of global retailers like Wal-
Mart Stores Inc., which is working with India's Bharti Enterprises to set
up a joint venture for a cash-and-carry business. In India, foreign
multiple-brand retailers, which sell diverse brands under one roof, are
limited to cash-and-carry and franchise or license operations.
"India's window of opportunity continues to be wide for retail
investment and development," the report said. "Once India's window
closes for grocery retailers, there will be little opportunity for market
domination in the main cities."

25
The country's growing population of young urban professionals with
disposable incomes and the nouveau riche has also made India
attractive for luxury retailers. India has attracted "the low end and the
high end because of the breadth of the consumer segments that are
available," said Gurski.
When variables stay constant, Gurski said, do-it-yourself, apparel and
electronics retailers usually enter emerging markets some two years
after international grocers establish themselves. Middle Eastern
countries are also represented on the list, with Saudi Arabia ranking
No. 10
India has emerged as the world's most attractive destination for mass
merchant and food retailing, maintaining its 2005 position in an annual
study of retail investment attractiveness among 30 emerging markets.
India was given the top ranking in management consulting company
AT Kearney's 2006 Global Retail Development Index (GRDI). "The
Indian retail market is gradually but surely opening up, while China's
market becomes increasingly saturated," said Fadi Farra, a principal in
AT Kearney's Consumer Industries and Retail Practice and leader of the
GRDI study. Much to the surprise of market observers, China was
ranked fifth in this year's tally, declining one more place since 2005.
While China remains very attractive, the market is becoming
increasingly saturate as and United Arab Emirates No. 18. Gap Inc
announced last week it had struck a deal with two franchisees to open
Gap stores in Saudi Arabia starting at the end of this year. Dubai has
capitalized on consumer desire for a more Western lifestyle and has
established itself as a retail mecca, Gurski said. Despite its focus on
luxury, Dubai is "just beginning to be populated by the bread-and-
butter retailers of the United States and the Western world," she said.
Retailers that have already established a presence in major Chinese
cities like Shanghai and Beijing, or those that have been slow to gain a
foothold there, are now looking at less developed markets in second-tier cities, the

26
study found. "If the markets are saturated, they're looking to make profits in the second-tier
cities," Gurski said.
But she cautioned that a separate strategy is needed for the smaller
markets since consumer tastes, ability to spend and willingness to
embrace new formats may be different than in larger urban areas.
International retailers rush to establish a presence and build market
share, the study reveals. According to the study, Asia with a large 40
per cent of the top 20 markets has surpassed Eastern Europe as the
'dominant region for global retail expansion.'

"The learning is that timing is the most important source of


competitive advantage for global and regional retailers in the
globalization race. Knowing when to enter emerging retail markets is
the key to success," said Farra. Powering Asia's charge are Vietnam,
which has risen five places to third place, and countries like Thailand,
South Korea and Malaysia, all of which are in the top 15, After topping
the ranking for two consecutive years in 2003 and 2004, Russia slipped
to second place behind India last year and remained there in 2006 too.

Origin of Retail Sector:

Early Trade:

When man started to cultivate and harvest the land, he would


occasionally find himself with a surplus of goods. Once the needs of his
family and local community were met, he would attempt to trade his
goods for different goods produced elsewhere. Thus markets were
formed. These early efforts to swap goods developed into more formal
gatherings. When a producer who had a surplus could not find another
producer with suitable products to swap, he may have allowed others
to owe him goods. Thus early credit terms would have been developed.
This would have led to symbolic representations of such debts in the
form of valuable items (such as gemstones or beads), and eventually
money.

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HOW RETAIL DEVELOPED:

Peddlers and Producers:

The Retail Trade is rooted in two groups, the peddlers and producers.
Peddlers tended to be opportunistic in their choice of stock and
customer. They would purchase any goods that they thought they
could sell for a profit. Producers were interested in selling goods that
they had produced.

General Store:

This division continues to this day with some shops specializing in


specific areas, reflecting their origins as outlets for producers (such as
Pacific Concord of Hong Kong), and others providing a broad mix,
known as General Store (such as Casey's in the Midwest of the U.S.A.).
Although specialist shops are still with us, over time, the general store
has increasingly taken on specialist products. Customers have found
this to be more convenient than having to visit many shops - thus the
term "Convenience Store" has also been applied to these shops. As the
popularity of general stores has grown, so has their size. This
combined with the advent of Self-Service has lead to the Supermarket,
or Superstore.

Early Markets:

Over time, producers would have seen value in deliberately over-


producing in order to profit from selling these goods. Merchants would
also have begun to appear. They would travel from village to village,
purchasing these goods and selling them for a profit. Over time, both
producers and merchants, would regularly take their goods to one
selling place in the centre of the community. Thus, regular markets
appeared.The First Shop : Eventually, markets would become
permanent fixtures i.e. shops. These shops along with the logistics
required to get the goods to them were, the start of the Retail Trade.

28
The Birth of Distance Retailing:

Defined as sales of goods between two distant parties where the


deliverer has no direct interest in the transaction, the earliest
instances of distance retailing probably coincided with the first regular
delivery or postal services. Such services would have started in earnest
once man had learned how to ride a camel, horse etc.
When individuals or groups left their community and settled elsewhere,
some missed foodstuffs and other goods that were only available in
their birthplace. They arranged for some of these goods to be sent to
them. Others in their newly adopted community enjoyed these goods
and demand grew. Similarly, new settlers discovered goods in their
new surroundings that they dispatched back to their birthplace, and
once again, demand grew. This soon turned into a regular trade.
Although such trading routes expanded mainly through the growth of
traveling salesmen and then wholesalers, there were still instances
where individuals purchased goods at long distance for their own use.
A second reason that distance selling increased was through war. As
armies marched through territories, they laid down communication
lines stretching from their home base to the front. As well as garnering
goods from whichever locality they found themselves in, they would
have also taken advantage of the lines of communication to order
goods from home.

Origins of Retail

It is likely that, as markets became more permanent fixtures they


evolved into shops. Although advantageous in many respects, this
removed the mobility that a peddler or traveling merchant may still
have enjoyed. For some shopkeepers, it made sense to obtain extra
stock and open up another shop, most probably operated by another

29
family member. This would recover business from peddlers and create
new business and the greater volume would allow the shopkeeper to
strike a better deal with suppliers. Thus the retail chain would have
started. Its thought that this process would have started in china over
2200 years ago with a chain of shops owned by a trader called Lo Kass.

The First Self-Service Store:

This all changed in 1915 when Albert Gerrard opened the Groceteria in
Los Angeles, the first documented self-service store. This was soon
followed a year later by the Piggly Wiggly® self-service store, founded
by Clarence Saunders in Tennessee in the U.S.

Growth:

This new type of shopping was more efficient and many customers
preferred it. Although personal service stores remain to this day, this
new concept started a rapid growth of self-service stores in the United
States. Other countries were slow to take up the idea, but there has
been a steady rise in the global amount of self-service stores ever
since.

Efficiency

These entrepreneurs noticed that their staff had to spend a great deal
of time taking grocery orders from customers. The groceries were
stacked on shelves allowing customers to walk around and browse,
collecting their shopping in a basket that was supplied. The
shopkeeper would only need to tot up the final bill at the end of the
process and transfer the goods from the basket to the customer and
receive payment.

From Family Business to Formal Structure:

30
Although retail chains would have been mostly run by families, as
some chains grew, they would have needed to employ people from
outside of their family. This was a limiting factor as there would have
been a limit to the amount of trusted non family members available to
help run the chain. Another, even more definite limiting factor was the
distance the furthest shop would have been from the original shop. The
greater the distance, the more time and effort would have been
needed to effectively manage outpost shops and to service them with
goods. There was, therefore, a natural barrier to expansion. That was
the case until transport and communications became faster and more
reliable. When this happened towards the end of the 19th century,
chains became much bigger and more widespread. Many of these
businesses became more structured and formalized, leading to the
retail chain that we see today.

31
32
Indian Retail Industry:

UNORGANISED RETAIL SECTOR:

Today, retailing doesn’t involve just dealing or marketing from shops, it


includes analyzing the market in an effort to provide reasonable prices
together with an array of options and experience to customers. The
sole purpose of all this is retaining the brand loyalty of customers.
Indian retail is currently a US$ 245 billion market and is anticipated to
extend to almost US$ 385 billion mark by the next five years. The
Indian retail sector is currently sporting a brand new look and together
with a 46.64 per cent three-year Compounded Annual Growth Rate
(CAGR), Conventional marketplaces are paving way for new shopping
malls, the likes of superstores, shopping plazas, supermarkets and
brand label stores. International style shopping centers have started
dotting the skyline of cities and smaller towns, acquainting the Indian
customer to a unique shopping experience. The retail industry in India
is split up into the unorganized and organized retail segments.
The unorganized retail sector includes the big, average and modest
grocery stores and the chemist shops. A changeover is taking place
from the conventional retail sector to organized retailing. But the
unorganized segment still dominates and leads the industry. By 2010,
the Indian retailing sector is anticipated to become an Rs12.5 trillion
market. The share of organized retailing is supposed to jump to about
10 per cent from the existing three per cent. The anticipated
staggering growth in organized retailing provides an opportunity to
expand the market for both established and new players. According to
the latest report India Retail Sector Analysis (2006ñ07)I by RNCOS, the
total retail market is primarily focused in rural regions, which makes up
55 per cent or US$ 165 billion of the overall retail market as opposed
to urban segment, which represents 45 per cent or US$ 135 billion of

33
the gross retail market. The rural market is spread over 627,000
villages, even though its centre of attention is focused around a core
group of 100,000 villages that makes up 50 per cent of the rural
population.
India represents the most compelling international investment
opportunity for mass merchant and food retailers looking to expand
overseas, according to management consulting firm AT Kearney's 2005
Global Retail Development Index (GRDI), an annual study of retail
investment attractiveness among 30 emerging markets. India is rated
as the fifth largest emerging retail market and is seen as a potential
goldmine. Driving global brands into India is the greatly improved
investment climate due to the recent relaxation of direct ownership
restrictions on foreign retailers. The country's retail market totals $330
billion, is vastly underserved and has grown by 10 per cent on an
average over the past five years. The message for retailers on India is
clear – move now or forego prime locations and market positions that
will soon become saturated. Global retailers that missed opportunities
to capture first-mover advantage in China will make up for it in India.

Though India has more than five million retail outlets, they are greatly
unorganized. There is no supply chain management perspective. In
fact, out of the entire retail sector in India, the organized sector is only
25 per cent and the rest is unorganized. 96 per cent of the retail
outlets are smaller in area than the standard norms. The retail industry
is divided into organized and unorganized sectors. Organized retailing
refers to trading activities undertaken by licensed retailers who are
registered for sales tax and income tax. These include corporate
backed hypermarket and retail chains and so on. Unorganized retailing
is the traditional low-cost shops, handcarts and pavements and is by
far the prevalent form of trade in India. The efficiency of organized
sector in retailing is manifested in some of the newer supermarkets in

34
urban/metropolitan India – the produce is cleaner, fresher, well packed
and often cheaper than the local shopkeeper. This is possible because
of the far more efficient distribution system, which organized retail
chains are employing, by cutting the layers of middlemen involved.
There are other benefits too, of transforming the unorganized retail
sector into an organized sector. Firstly, a number of new jobs will be
created, far better paid than the underage labor working in the local
shops. Secondly, the benefits to the producer and consumer through
better prices and lesser wastage; throwing up exportable surpluses,
which will also benefit the economy as a whole. Thus one can see that
allowing FDI in retailing is beneficial to all the stakeholders involved

The Big Bazaars and Spencer’s, the huge unorganized retail sector is
finally beginning to see the merit of logging on, even if at a model scale.
Taxation policies also push you to automate and the push is even
harder for those looking to expand beyond their single store existence.
Though it’s early days yet to measure it penetration in the unorganized
retail industry, interest levels are surely raising fast. “It’s good to at
least answer their questions. Though the interest is more with retailers
who register good sales and volumes.
Software available to the retailers is ShawMan’s RetailMagiK, which
takes care of the front-end store needs, as well as the back-end
warehouse requirements. “It would surely help the unorganized sector
to get into technologies like bar-coding, which will make their
operations more efficient. Some other features are a user-defined
billing screen and discount with control mechanism from the head-
office, delivery order management, batch control and quick information
search, among others. The product is a simple to use. The screen
design and the functionality are designed in such a way that the user

35
need not press too many keys to get things done,” says Khushroo
Bagwadia, business development manager, Shawman Software.
To begin with, most retailers look at decent entry-level solutions
starting at Rs 25,000. However, there are cheaper quick-fix solutions
available too. One can even deploy a computer and start with financial
accounting programmers like Microsoft Excel, FoxPro and Tally.
Small retailers seem next in line and vendors are also warming up to
the opportunity. At the low-end however, smart inexpensive solutions
are the need of the hour. And solutions providers like Microsoft, Polaris
and Shawman are now working on developing smart tools for the retail
enthusiasts. For small players with just one store, the investment on
retail solutions go really low, anywhere between Rs 10,000 to Rs
25,000. Most of the time these solutions are developed by local firms,
who at times compete with the big names in the industry.
According to Oberoi of Polaris, generally the mom-and-pop stores like
to go for technology, which will get their work done at a reasonable
cost. They avoid the high-end technology, and consider these as frills.
“They are not even bothered about upgrading, so the cheap systems
are more than welcome. These solutions might not work for the mid-
sized retailers with five stores, as then one need to scale it up and take
care of inventory and supply chain management,” he says.
Comparing the case with China, Vedamani suggests India is on the
right track. “In China, we find the organized sector to be 20-23% of the
total industry. Here, the technology has advanced in phases, and so is
the case in India.

36
Format Description The Value Proposition

Complete range available for a


Exclusive showrooms either owned or franchised out
Branded Stores given brand, certified product
by a manufacturer.
quality
Greater choice to the consumer,
Specialty Focus on a specific consumer need, carry most of
comparison between brands is
Stores the brands available
possible
Large stores having a wide variety of products,
Department organized into different departments such as One stop shop catering to varied/
Stores clothing, house wares, furniture, appliances, toys, consumer needs.
etc.
One stop shop catering to varied
Supermarkets Extremely large self-service retail outlets
consumer needs

Stores offering discounts on the retail price through


Discount Stores Low Prices
selling high volumes and reaping economies of scale

Larger than a supermarket, sometimes with a Low prices, vast choice available
Hyper- mart warehouse appearance, generally located in quieter including services such as
parts of the city cafeterias.

Convenience Small self-service formats located in crowded urban Convenient location and extended
stores areas. operating hours.

Enclosure having different formats of in-store Variety of shops available to each


Shopping Malls
retailers, all under one roof. other.

37
Formats adopted by the Retail Players in INDIA.

Retailer Original formats Later Formats

Relaince Fresh Supermarket Hypermarket (Spencer's)Specialty Store (Health and Glow)

Department Store (Piramyd


Piramal's Megastore)
Discount Store (TruMart)

Small format outlets (Shoppe) Supermarket(FoodBAZAR)


Pantaloon Retail Department Store (Pantaloon) Hypermarket (Big Bazaar) Mall (Central)

Department Store (shopper's


Supermarket
K Raheja Group stop) Hypermarket (TBA)
Specialty Store (Crossword)

Tata/ Trent Department Store (Westside) Hypermarket (Star India Bazaar)

Landmark Department Store (Lifestyle) Hypermarket (TBA)


Group
Others Discount Store (Subhiksha, Margin Free, Apna Bazaar), Supermarket (Nilgiri's), Specialty Electronics

RETAIL TRADE

Before supermarket got established themselves in the market , the retail trading shops
used to be the main centre for the consumers to purchase their groceries . But as the
supermarkets came into existence , the retail- trading centres which were sweeping the
markets earlier slowly went into oblivion . The supermarkets slowly appeared in all the
significant juctions and all the prominent places . the customers felt it very convenient to
purchase their commodities in the supermarkets, as the quality of the products is
exceptionally good. However, those people who are below middle class continue to visit
the small retail shops. But this is a very small quantity particularly in the urban
scenario . Except those , all the other sections of the society started visiting the
supermarket and now the supermarket concept has become a very great success.

38
Retailing is the interface between the producer and the individual consumer
buying for personal consumption. This excludes direct interface between the
manufacturer and institutional buyers such as the government and other bulk customers.
A retailer is one who stocks the producer’s goods and is involved in the act of selling it to
the individual consumer, at a margin of profit. As such, retailing is the last link that
connects the individual consumer with the manufacturing and distribution chain. The
retail industry in India is of late often being hailed as one of the sunrise sectors in the
economy. AT Kearney, the well-known international management consultancy, recently
identified India as the ‘first most attractive retail destination’ globally from among thirty
emergent markets. It has made India the cause of a good deal of excitement and the
cynosure of many foreign and domestic eyes. The entry of foreign and Indian retail giants
like Wal-Mart, Metro, Reliance, Birla, Tata etc. made Indian market more competitive
which is at cut throat level. So how retailers can reach to their end customers, to win the
mind share and increase the basket size of each shopping trip.
India retail industry is the largest industry in India, with an employment of around 8%
and contributing to over 10% of the country's GDP. Retail industry in India is expected to
rise 25% yearly being driven by strong income growth, changing lifestyles, and favorable
demographic patterns.

It is expected that by 2016 modern retail industry in India will be worth US$ 175- 200
billion. India retail industry is one of the fastest growing industries with revenue expected
in 2007 to amount US$ 320 billion and is increasing at a rate of 5% yearly. A further
increase of 7-8% is expected in the industry of retail in India by growth in consumerism
in urban areas, rising incomes, and a steep rise in rural consumption. It has further been
predicted that the retailing industry in India will amount to US$ 21.5 billion by 2010
from the current size of US$ 7.5 billion.

The growth of scope in the Indian retail market is mainly due to the change in the
consumer’s behavior. For the new generation have preference towards luxury
commodities which have been due to the strong increase in income, changing lifestyle,
and demographic patterns which are favorable.

39
Reliance Retail is the retail chain division of reliance industries of India which is headed
by Mukesh Ambani. Reliance has entered into this segment by opening new retail stores
into almost every metropolitan and regional area of India. Reliance plans to invest rs
25000 crores in the next 4 years in their retail division and plans to begin retail stores in
784 cities across the country. The reliance fresh supermarket chain is ril’s rs 25,000 crore
venture and it plans to add more stores across different g, and eventually have a pan-India
footprint by year 2011to the company. .

AS The twentieth century has come to and we have moved in to third millennium ,
we can see many development and changes taking place around us with all the industries
and firms within each industry trying to keep pace with all the industries and firm within
each industries trying to keep pace with the changes and diverse need of people .
Marketer have regarded “customer” as the king and evolved all activities to satisfy him
or her, this concept gaining more momentum and importance today.

More than a century ago, the father of our nation, Mahatma Gandhi, had made visionary
and deep meaningful statement at Johannesburg, South Africa in 1980. A customer is the
most important visitor of our premises. He is not dependent on us .We are dependent on
him He is not interruption on our work. He is the purpose of it and not an outsider on our
premises. He is a part of it. We are not doing him favour by serving him.

Major players in retail sector

Shoppers Stop:

40
Shoppers’ Stop is the pioneer of pan-nation one-stop retail outlets. Starting in 1991 with a
single store in Mumbai, it has now developed more than 20 stores (total retail space
crossed the 1 m mark in the second quarter of FY07). The company has added 1,568,479
sq ft of area during the year taking its total store area to 1,170,548 as on March 2007. The
company has a wholly owned subsidiary – Crossword – a specialty retail chain with over
32 stores spread across the country. This store specialises in books, gift articles and
stationery. During the quarter, Crossword opened its first store and 2 ‘Stop & Go’ stores
at the Mumbai domestic airport. Further, it forayed into airport retailing through a joint
venture with The Nuance Group AG of Switzerland. The company has also made an
entry into the entertainment sector by acquiring 45% stake in Time zone Entertainment
Pvt. Ltd. The recent moves by the company will widen the offering and de-risk its
dependence on the flagship Shoppers’ Stop stores.

Pantaloon:

Incorporated in 1987, Pantaloon Retail is among the pioneers in chain retailing. It is the
largest retailer in the country operating 350 stores across segments in over 40 cities
across the country and constituting 5 m square feet of retail space. Starting out with
dedicated apparel stores (Pantaloon), the company has stores across the cross-section of
the society. The company’s business is broadly divided into 2 segments, Lifestyle and
Value retailing. On the apparels front it has Pantaloon (31 departmental stores), Central
Malls (4 seamless malls as well as its other concepts). These stores can be classified
under ‘Lifestyle Retailing’. On the general merchandise front it has Big Bazaar
(51hypermarkets), Food Bazaar (77 supermarkets) and Fashion Station (5 fashion stores)
and other delivery formats. These fall under ‘Value Retailing’.

41
more

The more. Chain of supermarkets, are bright and clean stores, at convenient
locations with layouts that allow ease of navigation. The product display is well
organised and facilitates ease of choice. The stores have been designed by Fitch, the
leading international retail design firm.
The stores promise a range of benefits to consumers and are a solution to the many
problems faced by housewives while shopping for their daily needs. The retail offering
from the Aditya Birla Group, has been crafted after in-depth research of the needs and
expectations of the Indian consumers. more. is the answer to the shopping needs of the
Indian housewife who wants a modern and convenient option in her neighbourhood, with
an attractive and consistent range of products? more. assures consumers the security of
knowing that they are paying the best price in the market for good quality products.

RPG Group:

RPG Enterprises is one of India’s largest business conglomerates, with a turnover of US$
2.55 bn and assets worth US$ 1.8 billion. Since its inception in1979, RPG Enterprises has
been one of the fastest growing groups in India with more than 20 companies operating

42
successfully in 7 business sectors: Retail, IT & Communications, Entertainment, Power,
Transmission, Tyres and Life Sciences. In 2001, it established ‘Giant’ Hypermarket

Provogue (India) Ltd., (PIL) formerly Acme Clothing Pvt. Ltd was incorporated in
November 1997, converted in to a public limited company in March 2005. It deals with
fabrics, dyestuffs, chemicals and textile machinery. PIL operates in two core industry
segments. The first being designing, manufacturing and selling branded ready-made
garments and other accessories under the brand 'Provogue'. The second business is export
of finished fabrics, dyestuffs, chemicals and textile machinery to several markets in
African continent.

SWOT ANALYSIS

The Indian retail market accounted for $ 200 billions. Food accounts for over two-thirds
of the $200-billion Indian retail market. Yet, it has seen less than 1 per cent penetration
by modern retail so far.

Reliance industries which always looking for new business opportunities just started a
new era with its introduction of new concept stores named Reliance Fresh with opening
convince store in high streets of Banjara hills of Hyderabad. Reliance Fresh is very
different from what modern retail has offered in India so far and with this reliance is
planning to establish strong retail network in India in food and farm sector. They have
started with new eleven stores in the last week and they are thinking to add 100 more
stores to their feather by the end of this year.

43
Let’s do a SWOT analysis on the Reliance Fresh

Strengths:
Reliance is the first into enter into this unorganized sector of vegetables and fruits.
According to them its intentions to have100% farm fresh foods in their new retail stores.
It is also adding shortly a juice bar, and even a large counter for puja flowers. In fact,
over 60 per cent of the floor space has been dedicated to fresh fruits and vegetables, the
rest to other food products like staples, spices, bakery, etc. But reliance has decided not to
add any bar soap or toothpaste and detergent in its shelves. So by using this strategy they
are positioning themselves different from other players of the industries like Food world,
Big Bazaar and Nilgiris. But over come the short comings of these specialized stores they
are also introducing new Reliance full-fledged supermarket called Shakhari Bhandar
which offers each and everything from the staple to soap. Most of the staples are under its
own private label brand — ‘Reliance Select’. There is a 500g channa dal pack priced at
Rs 28, a 500g urad dal pack for Rs 39, all under Reliance’s own brand. Excepting a few
packets of Nestle’s Maggi, or MTR’s masalas or Pepsi’s Lays chips, there is very little
shelf space given to the big brand owners in the country. Reason: private labels offer far
better profit margin to the retailer than branded products of FMCG companies. Most of
these outlets will need only 2,000-5,000 sq. ft. A supermarket may need as much as
8,000-10,000 sq. ft.

Weakness:

This is definitely an interesting business venture but it may miss out on the opportunity
to capture a greater share of the customer’s wallet. For customers, too, this could be
irksome, as they would have to visit another store to pick up essentials. Reliance could
easily fix this problem by adding a few small counters for some basic non-food
products. According to their official this format is not final one they are accepting the
new changes which are required to attract the large number of customers.

44
Opportunities
Reliance wants to build a high-profitability business and food is, perhaps, the best
venture to start. That is because the Indian food supply chain is grossly inefficient. There
are several intermediaries, each of whom adds his own profit margin to the cost. Besides,
there is huge wastage in transit. This offers potential for savings and profits. To reduce
the cost and increase the profit it has been sourcing out its requirements from the farmers.
For example, the leafy vegetables, brinjals, tomatoes and green chilies in the Banjara
Hills outlet were sourced directly from farmers in Vantimamdi, Chevella and nearby
mandals in Ranga Reddy district of Andhra Pradesh. The supply chain already has been
backed by few hundred farmers the number is estimated to touch million in next five
years. The main aim of the reliance is to eliminate the intermediaries in the sector and
reduce the cost. Smaller stores have two advantages. They bring down the cost of real
estate (and increase profits). It is easier to find space for small convenience stores in a
quiet neighborhood than for supermarkets in high streets.

Threats:
This model is engineered to clock a faster turnover of inventory — Reliance expects
consumers to visit the store at least twice a week for their top-up groceries. Each store
will have an investment of Rs 50 lakh to Rs 60 lakh. Unlike global retailers who operate
on thin margins, Reliance Retail is looking at a fairly high-margin business model.
Deliberately stopped short of being a full-fledged supermarket rather, it has limited itself
to a food and grocery convenience store. They also have a threat from the existing
supermarkets which provides all the services to its customers. For Example Food world
and Nilgiris also provides food and beverages with other personal care products. These
convince are not existed in the present Reliance retail stores.

45
CHAPTER 5
(COMPANY PROFILE)

46
47
RELIANCE
"Growth has no limit at Reliance. I keep revising my vision.
Only when you can dream it, you can do it."

Dhirubhai H. Ambani
Founder Chairman Reliance Group
December 28, 1932 - July 6, 2002

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 USD 27 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

48
The Group's activities span exploration and production of oil and gas, petroleum refining
and marketing, petrochemicals (polyester, fibre intermediates, plastics and chemicals),
textiles and retail.
Reliance enjoys global leadership in its businesses; The Group exports products in excess
of USD 15 billion to more than 100 countries in the world. There are more than 25,000
employees on the rolls of Group Companies. Major Group Companies are Reliance
Industries Limited (including main subsidiaries Reliance Petroleum Limited and Reliance
Retail limited) and Reliance Industrial Infrastructure Limited.
Reliance Industries Limited is India's largest private sector conglomerate (and second
largest overall) with an annual turnover of US$ 35.9 billion and profit of US$ 4.85 billion
for the fiscal year ending in March 2008 making it one of India's private sector Fortune
Global 500 companies, being ranked at 206th position (2008). [1] It was founded by the
Indian industrialist Dhirubhai Ambani in 1966. Ambani has been a pioneer in introducing
financial instruments like fully convertible debentures to the Indian stock markets.
Ambani was one of the first entrepreneurs to draw retail investors to the stock markets.
Critics allege that the rise of Reliance Industries to the top slot in terms of market
capitalization is largely due to Dhirubhai's ability to manipulate the levers of a controlled
economy to his advantage.
Though the company's oil-related operation forms the core of its business, it has
diversified its operations in recent years. After severe differences between the founder's
two sons, Mukesh Ambani and Anil Ambani, the group was divided between them in
2006. In September 2008, Reliance Industries was the only Indian firm featured in the
Forbes's list of "world's 100 most respected companies"

49
Subsidiaries of RIL
• Reliance Petroleum
• Ranger Farms Limited
• Retail Concepts and Services (India) Private
Limited
• Reliance Retail
• Reliance Global Management Services (P)
Limited
• Reliance Biopharmaceuticals
• Reliance Ghatraj Services
• Reliance Engineering Associates (P) Limited

Reliance Retail Limited


Reliance is gearing up to revolutionize the retailing industry in India. Towards this end,
Reliance is aggressively working on introducing a pan-India network of retail outlets in
multiple formats.
A world class shopping environment, state of art technology, a seamless supply chain
infrastructure, a host of unique value-added services and above all, unmatched customer
experience, is what this initiative is all about.
The retail initiative of Reliance will be without a parallel in size and spread and make
India proud. Ensuring better returns to Indian farmers and manufacturers and greater
value for the Indian consumer, both in quality and quantity, will be an integral feature of
this project. By creating value at all levels, we will actively endeavour to contribute to
India's growth.
The project will boast of a seamless supply chain infrastructure, unprecedented even by
world standards. Through multiple formats and a wide range of categories, Reliance is
aiming to touch almost every Indian customer and supplier.

50
With a vision to generate inclusive growth and prosperity for farmers, vendor partners,
small shopkeepers and consumers, Reliance Retail Limited (RRL), a subsidiary of RIL,
was set up to lead Reliance Group’s foray into organized retail.
With a 27% share of world GDP, retail is a significant contributor to overall economic
activity across the world. Of this, organized retailing contributes between 20% to 55% in
various developing markets. The Indian retail industry is pegged at $ 300 billion and
growing at over 13% per year. Of this, presently, organized retailing is about 5%. This is
expected to grow to 10% by 2011. RRL has embarked upon an implementation plan to
build state-of-the-art retail infrastructure in India, which includes a multi-format store
strategy of opening neighbourhood convenience stores, hypermarkets, and specialty and
wholesale stores across India.
RRL launched its first store in November 2006 through its convenience store format
‘Reliance Fresh’. Since then RRL has rapidly grown to operate 590 stores across 13
states at the end of FY 2007-08. RRL launched its first ‘Reliance Digital’ store in April
2007 and its first and India’s largest hypermarket ‘Reliance Mart’ in Ahmadabad in
August 2007. This year, RRL has also launched its first few specialty stores for apparel
(Reliance Trends), footwear (Reliance Footprints), jewellery (Reliance Jewels), books,
music and other lifestyle products (Reliance Timeout), auto accessories and service
format (Reliance AutoZone) and also an initiative in the health and wellness business
through ‘Reliance Wellness’. In each of these store formats, RRL is offering a unique set
of products and services at a value price point that has not been available so far to the
Indian consumer. Overall, RRL is well positioned to rapidly expand its existing network
of 590 stores which operate in 57 cities.
During the year, RRL also focused on building strong relationships in the agri-business
value chain and has commenced marketing fruits, vegetables and staples that the
company sources directly to wholesalers and institutional customers. RRL provides its
customers with high quality produce that has better shelf life and more consistent quality
than was available earlier. RRL has made significant progress in establishing state-of-the-
art staples processing centres and expects to make them operational by May 2008.

51
Through the year, RRL also expanded its supply chain infrastructure. The Company is
fully geared to meet the requirements of its rapidly growing store network in an efficient
manner.

Recognizing that strategic alliances are going to be a key driver to its retail business, in
FY 2007-08, RRL established key joint ventures with international partners in apparel,
optical and office products businesses. Further, RRL will continue to seek synergistic
opportunities with other international players as well. This year, RRL will continue its
focus on rapid expansion of the existing and other new formats across India.

Popular Profiles at Reliance Retail


Management team

Name Designation
Mr. Mukesh Ambani Chairman&Managing
Director
Nikhil R Meshwani Executive Director
Hital R Meshwani Executive Director
Madhumita Mohanti Deputy General Manager
Akashay Lokhande Area Manager-Operation
&Sales and NSO
Devandra Chawla Vice-President-Business
Head, Merchandise Head
Zubin Nowrojee, State Head Category
Mangement

Formats of Reliance RETAIL


Reliance Fresh,

Reliance Mart,

52
Reliance Digital,

Reliance Trendz,

Reliance Footprint,

Reliance Wellness,

Reliance Jewels.

RELIANCE fRESH

APKA FRESH APKE


PADAOS ME

Reliance fresh is the retail chain division of reliance industries of India which is headed
by Mukesh Ambani. Reliance has entered into this segment by opening new retail stores
into almost every metropolitan and regional area of India. Reliance plans to invest rs
25000 crores in the next 4 years in their retail division and plans to begin retail stores in
784 cities across the country. The reliance fresh supermarket chain is ril’s rs 25,000 crore
venture and it plans to add more stores across different g, and eventually have a pan-India
footprint by year 2011. The super marts will sell fresh fruits and vegetables, staples,
groceries, fresh juice bars and dairy products and also will sport a separate enclosure and
supply-chain for non-vegetarian products. Besides, the stores would provide direct
employment to 5 lakh young Indians and indirect job opportunities to a million people,
according to the company. The company also has plans to train students and housewives
in customer care and quality services for part-time jobs

BACK GROUND

We can see many examples of businesses where, first we grow and then think of
expanding but Reliance is quite different. Reliance has developed such huge amount of
resources and capital over the years that whenever it steps into any segment it is not

53
required to wait for growing signal, that’s why it always thinks of expanding without any
boundaries. Reliance retail is next Step by RIL which will be a pan India project.
Reliance Fresh is the retail chain division of Reliance Industries of India which is headed
by Mukesh Ambani. Reliance has entered into this segment by opening new retail stores
into almost every metropolitan and regional area of India. Reliance plans to invest Rs
25000 crores in the next 4 years in their retail division and plans to begin retail stores in
784 cities across the country. The Reliance Fresh supermarket chain is RIL’s Rs 25,000
crore venture and it plans to add more stores across different g, and eventually have a
pan-India footprint by year 2011.
The super marts will sell fresh fruits and vegetables, staples, groceries, fresh juice bars
and dairy products and also will sport a separate enclosure and supply-chain for non-
vegetarian products. Besides, the stores would provide direct employment to 5 lakh
young Indians and indirect job opportunities to a million people, according to the
company. The company also has plans to train students and housewives in customer care
and quality services for part-time jobs.
The company is planning on opening new stores with store-size varying from 1,500 sq ft
to 3,000 sq ft, which will stock fresh fruits and vegetables, staples, FMCG products and
dairy products. Each store is said to be within a radius of 1-2 km of each other, in relation
to the concept of a neighbor store. However, this is only the entry roll-out that the
company has planned. Bangalore is said to have 40 stores in all by the end of the year.
In a dramatic change due circumstances prevailing in UP, West Bengal and Orissa, It was
mentioned recently in News Dailies that, Reliance Retail is moving out stocking.
Reliance Retail has decided to minimize its exposure in the fruit and vegetable business
and position Reliance Fresh as a pure play super market focusing on categories like food,
FMCG, home, consumer durables, IT, wellness and auto accessories, with food
accounting for the bulk of the business.
The company may not stock fruit and vegetables in some states, Orissa being one of
them. Though Reliance Fresh is not exiting the fruit and vegetable business altogether, it
has decided not to compete with local vendors partly due to political reasons, and partly
due to its inability to create a robust supply chain. This is quite different from what the
firm had originally planned. When the first Reliance Fresh store opened in Hyderabad
last October, not only did the company said the store’s main focus would be fresh
produce like fruits and vegetables at a much lower price, but also spoke at length about
its “farm-to-fork’’ theory. The idea the company spoke about was to source from farmers
and sell directly to the consumer removing middlemen out of the way.

54
FARM TO FORK
The Reliance retail company sources say it is setting aside Rs 50,000 crore to
build its farm-to-fork linkage. Reliance has drawn up plans for a presence in 784
towns and 6,000 mandi (wholesale market) towns with 1,600 rural business hubs
to service these. It has already rolled out 177 Reliance Fresh stores across major
towns in 11 states. According to a company report, RIL is targeting a turnover of
Rs 40,000 crore in the next few years.

55
TRADITIONAL MODEL OF RETAIL RELIANCE
“FARM TO FORK”

SUPPLY CHAIN MODELS of Reliance Retail

Reliance started its retail operations of Reliance Fresh stores with following
supply chain model. Procuring directly from the farmers and operating with

56
moderate margin but mass selling was key to Reliance fresh operation for first
few months. The following figure depicts the first Reliance fresh model

RELIANCE FRESH

FARMERS FARMERS FARMERS


CATEGOR CATEGOR CATEGOR
Y1 Y2 Y3

Fa
rm n
ers
Ow rtatio
COLLECTIO o
nT r ansp
ran N T
sp POINT/UNI O wn
ort
at T ers
ion rm
Fa

RELIANCE OWN
LOGISTICS

PROCESSIN
G
RF tics UNIT/POINT Re
is li an RF
Log ce
own ow
nL
e
nc og
lia ist
Re ics

RELIANCE RELIANCE RELIANCE


FRESH FRESH FRESH
OUTLETS OUTLETS OUTLETS

WHOLESALE TRADING (WST) :


Reliance formalized its second supply chain model to shift itself from grocery retailer
to grocery supplier by focusing and establishing itself in Mandi’s.

STEPS IN WTS MODEL:

57
1) Reliance has owned farms on contract basis for production of specific crop which
is decided after extensive research depending on
• SOIL CONDITIONS,
• CLIMATE CONDITIONS,
• RETURN OVER COSTS INCURRED.
So as to yield best possible results.

2) Different vegetables and fruits from such farms are collected through reliance own
Logistics and brought to collection Processing centres where quality check and
other required processing is done.

In processing centres workers wearing balaclavas, woollen trousers and bulky


jackets work inside a room kept at a constant 3oC, peeling and chopping vegetables,
spinning them dry and then heaping them in small plastic packets before placing them
in plastic transport crates. At the other end of the 5,000-sq-m warehouse, men unload
crates of fruits from a truck pulled up to a spotless loading dock. A quality-control
expert samples every tenth crate; if the fruits are good a team will ready them for
delivery within hours to Reliance fresh stores around different places like U.P and as
far away as Hyderabad and even Mumbai (formerly Bombay). If they are not,
workers will inspect the entire shipment and discard anything below standard.

3) Merchandise from these collection processing centers are collected and loaded
for Wholesale mandi’s. As this merchandise is to be made available by 4 A.M in
morning thus deliveries in trucks are sent at time depending upon:

TRANSIT TIME. – Time required reaching destination i.e. mandi’s.

MARGIN TIME. – Time period between a truck reaching mandi and then Unloads.
Can be 2 to 3 hours.

LOADING AND UNLOADING TIME.


4) From mandi’s where the trucks have been unloaded, roadside vendors and pull
carters Buy fruits and vegetables to supply in households.

5) In case still some vegetables and fruits are not sold reliance logistics own
Transportation sends them to reliance fresh stores.

58
CHAPTER –6
(DATA ANALYSIS AND
INTERPRETATION)

6.1. AGE-WISE CLASSIFICATION OF THE RESPONDENTS

Age in years No. of Respondents Percentage


20-25 20 40%
26-30 7 14%
31-35 6 12%
36-40 5 10%
41-45 7 14%

59
46-50 5 10%
TOTAL 50 100%

Source: questionnaire

Chart No. 3.1

INTERPRETATION:
From the table no:3.1. it can be observed that 40% of the respondents who visit the
supermarkets belong to the age of 20- 25 years , while 14% belong to the age group of
26-30 years and 41-45 years, 12% belong to 31-35 years of age and 10% belong to the
age of 36-40 years and 46-50 years .

6.2. GENDER WISE CLASSIFICATION OF THE RESPONDENTS:

No. of
Gender Respondents Percentage
Female 30 60%
Male 20 40%
TOTAL 50 100%

60
Source: questionnaire

Chart no 3.2

INTERPRETATION :
From the table no: 3.2 it can be seen that 60% of the respondent who visit the
supermarket are females and 40% of the respondents belong to male .

6.3. FAMILY SIZE CLASSIFICATION OF THE RESPONDENT

Fimily size No. of Families Percentage


2 5 10%
3 6 12%
4 16 32%
5 18 36%

61
6 and above 5 10%
TOTAL 50 100%

Source: questionnaire

Chart No. 3.3

INTERPRETATION:
From the table no:3.3 it is understood that the 10% of respondents belong to the family
size of 2 and 6. 12% of the respondents belong to family size 3 and 36% of the
Respondents belong to the family size of 5.

6.4 MONTHLY INCOME :

No. of
Income Respondent Percentage
5000-10000 14 28%
11000-15000 7 14%
16000-20000 10 20%

62
21000-25000 5 10%
26000-30000 4 8%
30000 and above 10 20%
TOTAL 50 100%

Source:questionnaire

Chart No.3. 4

INTERPRETATION :
From the table no:3.4 it can be seen that 28% of the respondents who visit the
supermarket belong to the income group of 5000-10000 p.m. 14% belong to 11000-
15000 p.m. ,20% people belong to 16000-20000 p.m. and the least belong to the income
group from 26000-30000 p.m.

6.5 PREFERANCE OF VISITING SUPER MARKET

No.of
Percenta
Particulars responde
ge
nts

63
No. of respondents say Yes 35 70%
No. of respondents say No 15 30%
TOTAL 50 100%

source : Questionnaire
Chart
No : 3.5

INTERPRETATION :

From the table No. 3.5 it can be understood that the 70% of the respondents visit
super market
and 30% of the respondents do not visit super market.

64
6.6 NO. OF TIMES VISITING SUPERMARKETS

No. of
Respon Percenta
Visits dent ge
1 to 5 20 40%
6 to 10 15 30%
Over 10 15 30%
TOTAL 50 100%

Source:que
stionnaire

Chart
No. 3. 6

INTERPRETATION :

From the table no:3.6 it can be observed that 40% of the


respondents visit the supermarket once in a month and
30% of the respondents visit the supermarket twice or
thrice in a month.

65
6.7 PARTICULAR DAY FOR
SHOPPING

No.of
respo Percent
Names
ndent age
s
Sunday 16 32%
Monday 6 12%
Tuesday 2 4%
Wednesd
2 4%
ay
Thursday 4 8%
Friday 8 16%
Saturday 12 24%
TOTAL 50 100%

source :
Questionnaire

Chart
No :
3.7

66
6.9. BUYING OF DAILY REQUIREMENTS

No. of
option Respondents Percentage
No. of respondent saying
Yes 37 74%
No. of respondent saying
No 13 26%
TOTAL 50 100%

Source: questionnaire

Chart No. 3.9

67
INTERPRETATION :
From the table no: 3.9 it can be stated that 74% of the respondents buy their daily
requirements from supermarket and only 26% of the respondents do not buy their daily
requirements from supermarket.m,k

6.10. DIFFICUILTY IN LOCATING DESIRED PRODUCTS

No. of
Responden
Income t
No. of respondent saying NO 44
No. of respondent saying YES 6
TOTAL 50

Source: questionnaire

Chart no.3.10

68
Locating desired product
12%

No. of respondent saying


Yes
No. of respondent saying No

88%

INTERPRETATION :

From the table no.3.10 it can be understood that the 88% of the people do not
find difficulty in locating desired product and only 12 % people find difficulty in
locating desired product.

6.11 ATTRACTED TOWARDS SUPER MARKET

No.of
Particulars respondent Percentage
s
Reasonable Price 7 14%
Avaliablity of
goods under one 18 36%
Roof
Discounts 15 30%
Saving in 10 20%

69
shopping
TOTAL 50 100%

source : Questionnaire
Chart No :
3.11

INTERPRETATION :

From the table No.3.11 it can be stated that 36% of the respondents
prefer
visiting super market because of avaliability of goods under one roof, 30%
because of discounts, 14% because of resonable price and 20% because
of
saving in shopping time.

6.12 REASON FOR VISITING SUPER MARKET

No.of Percentag
Reasons
respondents e
Near your home 20 40%
Centrally located 15 30%

70
Way to home 15 30%
TOTAL 50 100%

source : Questionnaire

Chart No :
3.12

INTERPRETATION :

From the table no:3.12 it can be seen that 40% of the respondents visit
the super market because it is near to their house and 30% of the
respondents
visit super market because it is centrally located and 30% of the
repondents
visit super market because it is on their way to
home.

6.13 NEED PARKING FACILITY

No. of
option Respondents Percentage
No. of respondent 40 80%

71
saying Yes
No. of respondent
saying No 10 20%
TOTAL 50 100%

Source:
questionnaire

Chart No. 3.13

INTERPRETATION :
From the table no:3.13 it can be understood that 80% of the respondents need parking
facility and 20 of the respondents people do not need parking facility.

6.14 SATISFIED WITH THE PACKING :

No.of
Percentag
Option respondent
e
s
No.of respondents 40 80%

72
say Yes
No.of respondents
10 20%
say No
TOTAL 50 100%

source : Questionnaire

Chart No :
3.14

INTERPRETATION :

From the table No:3.14 it can be stated that 80% of the respondents
they are
statisfied by the packing provided and 20% of the respondents say that
they
are not statisfied with the packing provided by the super market .

6.15 HOW IS THE STAFF IN SUPER MARKET

73
No.of
Options respondent Percentage
s
Cooperative 25 50%
Attentive 20 40%
Inattentive 5 10%
TOTAL 50 100%

source : Questionnaire

Chart No :
3.15

INTERPRETATION :

From 3.15 it can be observed that the 50% of the respondents say that
the
staffs of the super markets are cooperative, 40% say that the staff is
attentive
and 10% of the respondents say that the staff is inattentive.

74
6.16. PROFIT MARGIN CHARGED IS REASONABLE OR NOT

option No. of Respondents Percentage


Yes 40 80%
No 10 20%
TOTAL 50 100%

Source: questionnaire

Chart No. 3.16

INTERPRETATION :

From the table no:3.16 it can be observed that 80% of the respondents say that the profit
margin charged by supermarket is reasonable and only 20% of the respondents says that
it is not reasonable.

6.17. CHANGES TO BE MADE

75
No. of
option Respondents Percentage
No. of respondent
saying Yes 16 32%
No. of respondent
saying No 34 68%
TOTAL 50 100%

Source:
questionnaire

Chart No. 3.17

INTERPRETATION :
From the table no:3.17 it can be understood that 32% of the respondents wants same
changes to be made in the supermarket and 68% of the respondents do not want any
changes to be made .

6.18 SATISFIED WITH THE SERVICE PROVIDED

76
OPTION No. of Respondents Percentage
No. of respondent saying Yes 40 80%
No. of respondent saying No 10 20%
TOTAL 50 100%

Source: questionnaire

Chart no: 3.18

INTERPRETATION:
From the above table no:3.18 it can be stated that the 80% of the respondents
are
satisfied with the service provided and 20% are not satisfied with the service
provided by the supermarket

77
CHAPTER 7

(FINDINGS AND
SUGGESTIONS)

FINDINGS:

78
 From the study it is observed that in demographic segmentation,
age wise classification of the respondents 40% of the
respondents are who visit the super markets belong to the 20-25
age group which means they are the main visitors of the super
markets.

 Majority of 60% respondents who visit super markets are


females. 36% of the respondents belong to the family size of 5
members. Income wise categorizations 28% of the respondents
are fallen under income level of Rs.5.000-10.000.

 88% of the respondents prefer visiting the Reliance fresh super


market. 32% of the respondents visit Reliance Fresh on Sunday,
12% on Monday, 4% on Tuesday, 4% on Wednesday, 8% on
Thursday, 16% on Friday and 24% on Saturday.

 36% of the respondents visit super market because of goods


available under one roof, 30% because wore discount, 20%
because of saving time and 14% because of reasonable price

 40% of the respondents visit super market once in a month and


only 30% of respondents visit twice or thrice in a month. 60% of
respondents needs parking facility and 40% don’t need parking
facility.

 74% of the respondents buy their daily requirements from the


super marker and only 26% of the respondents buy occasionally.
80% of the respondents profit margin charged by the super
market is reasonable and only 20% of the respondents say it is
not reasonable.

79
 50% of the respondents say that the staff is cooperative in the
Reliance Fresh super market, 40% of the respondents say that
the staff is attentive and 10% of the respondents say that the
staff is inattentive.

 32% of the respondents say that they want some changes to be


made in the super market and 68% of the respondents do not
want any changes to be made.

SUGGESTIONS:
From the study “A survey on customer’s perception on super markets”.
We observe that the customers are satisfied with the products
available in the super market. From the study we can conclude to
recommend.

• Increase the source of information for super market by giving


advertisements in T.V, newspaper, Radio, etc,. give more
benefits in terms of discounts, coupons, samples etc,.

• Decrease the price range of products so that even middle and


lower income level groups can also afford to purchase the
products.

• Super market should always try to fulfill their promises on time


so that consumers are satisfie

80
CHAPTER 8

(CONCLUSIONS)

81
CONCLUSION :

1. Female visiting to super market are more i.e., (60%) in number


than males consumers prefers to visit super market because of
availability of goods under one roof, discounts etc.,

2. Highest of 50% customers visit because of shopping at once


place and they are very much satisfied with the profit margin
charged by the super market.

3. shopping at the super market is very time consuming to the


consumers. Super market always try to fulfill their promises like
giving free coupons, offering free gift, going for lucky draws and
rewarding with cash price to the lucky winners.

4. 74% of the consumer buy their daily requirements from the


super market the customers gets from home delivery, discounts,
seasonal offers, buy one get one free offers, free sample etc,.

5. consumer not only watch advertisements in T.V about super


market and come to know about them but also they come across
through news papers, hoardings, magazines, pamphlets and also
thoughts friends. The staff is also cooperative and attentive with
the customers.

82
CHAPTER 9

(BIBLOGRAPHY)

83
BIBILOGRAPHY

1. MARKETING MANAGEMENT –

- PHILIP KOTLER , PEARSON EDUCATION PVT LTD , THIRD


EDITION – 2003.

2. MARKETING MANAGEMENT –

- V.S.RAMASWAMY AND S.NAMAKUMARI MAC MILLAN


BUSINESS BOOKS, THINRD EDITION-2002.

3. RETAILING –

-PATRIC M.DONNE, FOURTH EDITION

INTERNET SITES :

WWW.GOOGLE.COM

WWW.RELIANCEFRESH.COM

WWW.RILCOUSTERMSSERVICE.COM

84
CHAPTER 10
(ANNEXURE)

85
Questionnaire

Consumer perception towards Reliance Fresh

QUESTIONNAIRE
Note : Please tick mark [ ] in the square where necessary.

1. Name : []
Address : Age : []

2. Occupation :
Service : [] SEX : Male [ ] Female []
Business : [] Married [ ] Unmarried [ ]
Others : []

3. Number of members in the family ?


1 to 3 []
3 to 6 []
Over 6 []

4. Monthly income in Rupees ?


Below Rs 10,000 []
10,000 - 15,000 []
15,000 - 20,000 []
Above -20,000 []

5. Do you prefer visiting super market ?


Yes [ ] No [ ]

6. How many times do go to Super market in a month ?


1–5 [] 5 – 10 [ ] over 10 [ ]

7. Do you prefer any particular day for shopping ?


Yes [ ] No [ ]

8. If yes, specify the day you prefer ? [--------------]

86
9. Do you buy most of your daily requirements from the supermarket ?
Yes [ ] No [ ]

10. Do you find any difficulty in locating the desired products ?


Yes [ ] No [ ]

11. Are you attracted to the super market because of


a. Reasonable price ? Yes [] No [ ]
b. Availability of goods under one roof Yes [] No [ ]
c. Discounts ? Yes [] No [ ]
d. Saving in shopping time ? Yes [] No [ ]

12. Do you visit super market because


a. It is near your home Yes [] No []
b. It is on your way to home Yes [] No []
c. It is centrally located Yes [] No []

13. Do you need parking facility to make your visit easy ?


Yes [] No []

14. Are you satisfy with the packing provided ?


Yes [] No []

15. Do you find the sales assistance in the super market ? ( Please tick mark [ ]
only one of the alternatives)
a. Attentive [] b. Inattentive [ ] c. Cooperative [ ]

16. Do you feel the profit margin charged by the super markets is reasonable ?
Yes [] No []

17. Do you need any changes to be made ?


Yes [] No []

18. Are you satisfied with the service provided by the Reliance Fresh ?
Yes [] No []

87