RELIANCE RETAIL

Presented By : BALAJEE S A045 NISHANT CHOTALIA A015 NIMISHA RATHI A044 JEEVA MARIA JOY A028 AAKASH KHOLIA A032 ABHISHEK SHRIVASTAVA A

GROUP

History
Reliance Retail a unit of Reliance Industries, started its operations in 2006 with Reliance Fresh, grocery store

Since its inception in 2006, Reliance Retail Limited (RRL) has grown into an organization that caters to millions of customers, thousands of farmers and vendors
Reliance Retail, currently operates around 1,000 stores in the country across value retail, or food and groceries segment, and specialty formats The company has an aggressive plan to expand its retail network across India. It is buying real estate in 20 towns and cities to build big-box hypermarkets, moving beyond its earlier model of leased properties and small formats

The company has entered into exclusive agreements with textile companies such as Arvind Mills etc. to develop exclusive brands for its retrial outlets
Rob Cissell, CEO of Reliance Retail, comes from Walmart China

Plan to make Reliance Retail a Rs 40,000-50,000 crore powerhouse

Reliance Retail Formats

Differentiation in Formats
Reliance Fresh Vertical Food and Grocery Fresh fruits, vegetables and dairy products Reliance Digital Specialty Consumer durables Electronic goods and household appliances Reliance Mart Hypermarket Reliance Mini mart Supermarket Reliance Trendz SpecialtyApparel Apparels and accessories Product Offering Food and grocery, apparel, consumer durables, footwear 50,000 2,50,000 Reliance Footprint Specialty Footwear Footwear Food and grocery, apparel, footwear

Area (sq. ft)

3,0005,000 Reliance Wellness

15,000 30,000 Reliance Home Specialty Home Furniture and furnishings 40,000 60,000

10,000 50,000 Reliance Jewels Specialty Jewellery Jewellery

30,000

Vertical Product offering Area (sq.ft.)

Specialty wellness products Pharmaceuticals and medical services 1,5003,500

8,000 10,000

2,000 20,000

Reliance Retail Figures

25% increase in consolidated revenues in 2011-12 Reliance Fresh loss of Rs 273.8 crore on a revenue of Rs 3,860.4 crore

Reliance Digital Retail posted a loss of Rs 55.1 crore on a revenue of Rs 1,234 crore
Reliance Brands, which has agreements with global brands such as Diesel, posted a loss of Rs 18.7 crore on a turnover of Rs 30.9 crore Reliance Trends, which runs fashion stores, incurred a loss of Rs 11.35 crore on a turnover of Rs 489 crore Reliance Gems & Jewels posted a profit after tax of Rs 0.84 crore on a revenue of Rs 475.5 crore. Reliance Footprint made a loss of Rs 0.6 crore on a revenue of Rs 155.4 crore Reliance Footprint made a loss of Rs 0.6 crore on a revenue of Rs 155.4 crore Similar Trends seen with in other big organised retailers

Value Chain Analysis

Shelf Centered Collaboration

Manufacturers and retailers can finally put right product on right shelf at right time for right customer

Value Chain Analysis

Location
Located on S V Road, Santacruz Entrance on a side road convenient for parking and entry Near Milan Subway Signal Far from conventional station markets Easy access from Express Highway Residential localities nearby

Layout

Basement : Groceries, fresh food, Veg and Non Veg, Bakery Products, dry fruits, etc. Ground level : FMCG products including packaged food, personal care, beverages, etc. Also awine and beer store First floor : Sports goods and garments kids section with games, soft toys etc., Garments of male female, shoes , etc.Stationery items Second floor Electronics -Croma like setup for display- Furniture Home accessories - with modular models, high end furniture, etc

Traffic
Traffic is high on weekends Sat and Sunday. More so on the 1st 2 weekends of the month Traffic very high in basement and ground level due to commodity products

Music is played throughout the store Mostly popular Bollywood Also used for announcements of various offers periodically Colors mostly used are bright ones blue, red & yellow matching the scheme of RIL logo

Ambienc e

Price & Promotion

Savings mentioned for the concerned Promotions are usually in bulk products Motto
E.g. Buy 2 get X amount off or buy 2 get one free.. Mostly for slow moving SKU No promotions seen for fast moving items like cold drinks, regular cereal, biscuits etc Festive offers Diwali discounts available When one enters a flyer stating all the good deals is given

Loyalty Program

They have a loyalty card given to all customers in which all transactions are recorded and points accumulated Sales people dedicated to enroll new customers Also a prepaid loyalty card available to bind customers to the store which can be used in all Reliance Retail outlets

Merchandis e
Wide range of merchandise stocked All SKU of each product available in most categories Variants too are high Very good choice Display appears exhaustive for many products

Service Levels

More of a self help kind of store However special assistance for few prodcts like Cadbury Sweets, Soul Pickles, iChing products were seen Proactive assistance for beauty product lines like Olay, Revlon were seen The 1st and the 2nd floor are more spacious -High involvement items stocked Also more salesmen available for help

CRM at Reliance Mart

Customer Loyalty
CRM Customer Communication Customer Gratification

Customer Retention

Customer Loyalty
Special membership loyalty program called Reliance One

Willing customers are required to fill a form giving personal information and gets a temporary card

On each purchase of Rs. 100 the customer gets one redeemable point

Collected points can be redeemed in form of discounts on future purchase Customers also get the opportunity of availing four different kinds of insurance on payment of a nominal fee Eg: customer can get accident death insurance of Rs. 6 lakhs on the payment of Rs. 400 only Other form of insurances are disability, hospitalization and home insurances

Customer Retention
Retention policy is implemented at zonal level Each state is regarded as a zone and offers and discounts available in one zone are not available in any other zone, this will help in capturing local markets Products which show improvement due to offers on them are repeated again so as to retain sales of customers who bought last time Maintaining a good store ambience Clean and hygienic environment with properly and well spaced products along with a uniform color theme attracts the existing customers to the store again Fast billing system Good and easy grievance handling system which can be accessed through customer service desk and company website

Customer Gratification
Trained salespersons make customer gratification very easy

A simple thank you with a smile goes a long way for the store to keep the customers happy
Special events organized by stores across India are also a way to gratify the customers by allowing them to play and win prizes Gift vouchers and discount coupons are an attraction for the customers and give them the feel that the store cares about them and their money

Communication
Communication to existing customers takes the form of SMS and e-mails, generally sent to reliance one members

Information about ongoing offers and latest news about the nearest stores and company in general

Another source of customer database is the information collected during the organizing of special events in the stores

Thank you and festive cards on special occasions are innovative way of communicating with the customers

Exclusive Services
The Reliance ResQ customer support center provides aftersales installation and servicing for electronic appliances as well as other durables, 365 days a year

Offers unique services like tailoring, shoe repair, watch repair, a photo shop, gifting services and laundry services

It has a bakery that offers freshly baked breads and other products and also an icecream parlor

In-house mill to grind wheat which customers can pick out themselves and also gives the option of picking up readymade batter

IRS Calculation
Customers:
Population of Santacruz/Khar= 5,80,835 (Source:2001 Census) Current population of Santacruz/Khar = 6,09,877 (4.7 % increase as per census data) No. of Households(H) =6,09,877/4 = 1,52,469 (Assumption: 4 members per household) Annual per household Expenditure of Santacruz/Khar = Rs. 2,10,000 Annual Retail Expenditure per household (RE) = 0.25 * 2,10,000 = Rs. 52,500 (Assumption: 25% is retail expenditure) RE per week = Rs. 52,500/52 = Rs. 1009

Expenditure:

Area:

Total square footage of that particular line of trade in that area including Relaince Mart (RF) = 1,33,066sq.ft (12,000 sq.m)

IRS = H * RE/RF = Rs. 1156 sales/sq foot

Competitor Analysis
Reliance Mart v/s Big Bazaar

Reliance is a one stop shop for everything that the customer requires A hyper mart with discounts and promotions as an add on more of bulk promotions

Big Bazaar is well known for cheaper deals on groceries and commodities
More of a discount store attracting customers specially on Sasta Budhvaar

Competitor Analysis (contd.)

Shopping Experience Merchandise
Reliance Mart
Much better at Reliance Mart more spacious, includes different categories like electronics, garments, house wares, etc.

Location

A wide variety of merchandise stocked all variants, SKUs, etc.

High Street Location S V Road

Big Bazaar
Not that great only groceries and commodities available Mostly fast moving SKUs stocked Location near Milan Subway high traffic area, flyover construction going on from considerable time

Competitor Analysis(contd.)
Facilities Ambience
Reliance Mart
Ample Parking space available in the adjacent lanes Better ambience music, with promotional offers announced Ready to eat food & bakery Different offerings are cross sold loans for furniture and other high investment goods

Cross Selling

Big Bazaar
Lack of parking space paid parking in the basement of Milan Mall No such ambience observed No such cross selling observed

Whats Going Wrong

Basement is congested as compared to ground floor Aisle space is very less and queues from counters extend all the way Practice of express checkout counters not followed strictly Section of spices is highly unorganized with many products with open/torn packaging Only electronics gets billed at the Reliance Digital floor though many other items are there Home delivery option is for very less radius(1km)

New Store Location(Coimbatore)

Demographics
15th largest urban agglomeration in India with a metropolitan population of over 2 million

Consumer Lifestyle
Target consumers in the city are mainly young professionals. It revenues in state is increasing at a rate of 90%

Income Potential
Hub of manufacturing and textile industries Annual household income is Rs. 2,42,200 Coimbatore is the highest revenue earning district in Tamil Nadu

Population mix
The population consists mainly of professionals and labor class. City has many offices and manufacturing hubs

New Store Location(Coimbatore)

Customers:
Population of Coimbatore = 21,51,466(Source:2011 Census) Population of TG = 2151466/3 = 7,17,155 No. of Households(H) = 717155/4 = 1,79,289 (Assumption: 4 members per household)

Expenditure:

Annual per household income = 2,42,200 Annual per household Expenditure of Coimbatore= Rs. 1,45,320 (60% of income) Annual Retail Expenditure per household (RE) = 0.25 * 1,45,320 = Rs. 36,330 (Assumption: 25% is retail expenditure) RE per week = Rs. 36330/52 = Rs. 698

Area:

Total square footage of that particular line of trade in that area (RF) = 1,08,900sq.ft (10,000 sq.m)

IRS = H * RE/RF = Rs. 1149 sales/sq foot