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Principles & Concepts of Retail –

A Journey Across The World Of Retailing

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 •Retail
•Retail
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•Retail `

It’s Everywhere
Sample
 RETAILING

WHAT IS RETAILING?
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WHAT DO RETAILERS DO?

WHY IS RETAILING IMPORTANT

IN OUR SOCIETY?
 RETAILING IS:
• Set of all activities that result in the offering
for sale

• Goods and/ or services

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• To individuals and/ or organizations

• For the purpose of ultimate consumption

 DISTRIBUTION CHANNEL

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Manufacturer Wholesaler Retailer Consumer

 FUNCTIONS OF A RETAILER
• Provides products and services

• Breaks Bulk

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• Holding inventory/ Assumes storage function `

• Providing services

• Assumes risk

• Increase value of the products & services

` What Retail Used to Be?? `

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 What Retail Has Transformed To…..

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` Ecommerce `
 Why These Changes?

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The Growth of the Nuclear Family
The Indian
Woman….
….re-defined!
 Some more visible
changes in lifestyle
` … `
…an evening out, then…
…an evening out, now…
Family
dinner,
then…
Family
dinners,
now…
Menu………..Indian Cuisine
Menu……
Global
Cuisine
Then preferred…..Cooked…
Preferred now…. …
Processed
Travel, then…
…Travel,now
Once, a common mode
of travel…
…now, a
Preferred Mode
Dad’s idea of a
great holiday…
 Dad’s idea of a great holiday…

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…Son’s idea of a
great holiday
 …Son’s idea of a great holiday

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 The Indian Consumer Is Rapidly Transforming

Paradigm Shift in almost all aspects of life

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Outlook– From Traditional to Modernized Traditional

 Expected Utility from Products/ Services

From Functional to Lifestyle

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 With the availability of
low-interest finance
schemes, price is
increasingly becoming
` a smaller factor in a `

purchase decision in a
whole range of
consumer durables
also

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 The newer generation is
willing to pay more if they are
convinced that they are getting better
value for the higher price
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 Upgrade is part of life!!

Today the average life of a mobile is 12 
months;
 That of a TV three years; cars four to five 
` years and soon even homes will be changed  `

more frequently 

Clearly durability is no longer the most 
desirable value
 "One Household, Multiple Products”
Two cars is no longer a luxury but a
practical necessity for working couples
Two TVs in the house is recognition of
the fact that different family members
have different interests
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Exposure to Media
The Power of
the Box
Office
Aspirational Values 
and Icons…
Aspirational Values
and Icons…
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Aspirational values and icons…
Cause
s...
…and
effects..
.....
…and,
feel
good !
 The Result ..

Very visible changes in

`
lifestyle statements… `
The old 
mantra

save, 
save, 
save !
The 
new 
mantra
- spend, 
and 
now !
THE NEW SHOPPING CULTURE
 FACTORS INFLUENCING RETAIL
• Economic Growth: Gradual increase in GDP & purchasing power of 
Indians
• Urbanization: Population residing in urban areas in India, according to 
1901 census, was 11.4%.This count increased to 28.53% according to 
2001 census, and crossing 30% as per 2011 census, standing at 
31.16%.According to a survey by UN State of the World Population 
` report in 2007, by 2030, 40.76% of country's population is expected to  `
reside in urban areas.As per World Bank, India, along with China, 
Indonesia, Nigeria, and the United States, will lead the world's urban 
population surge by 2050. Time constraint & traffic congestion in
cities has led to increased One Stop Shopping
• Consumerism: Increased influence of western media leading to
change in lifestyle. Materialistic demands among middle class
gaining momentum
• Brand Profusion: Increased brand consciousness
 FACTORS INFLUENCING RETAIL
• Young Population: A majority of the Indian population is young
and willing to spend creating an keen demand for latest products
and technology.

• Easy availability of Retail Space : The ever increasing number of

malls and shopping centers in major metros has attracted a large
` number of Indian and foreign retailers to open their shops in `
India.

• Opening stores on revenue sharing basis: A large number of

malls are ready to enter into strategic partnerships with their
tenants such as revenue sharing agreements to offset the high
cost of real estate.
 POPULATION V/S RETAIL BUSINESS

COUNTRY POPULATION RETAIL

BUSINESS
(2017)
` US 327.16 Million $ 3.1 Trillion `

CHINA 1.41 Billion $ 3128 Billion

INDIA 1.32 Billion $ 1071

Billion
 7 P’S OF RETAILING

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 Product

Promotion Personnel

`
7 Ps of `
Retailing
Physical Personalized
Facilities Services

Place Price
 Retailing Decisions

It is the task of a retailer to appeal to the target market.

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Merchandise mix Service mix
The product assortment and brands  Types of services offered 
that will be carried by the store  to customers
 Product
The mix of products offered
to the consumer by the retailer; also
called the product assortment or
merchandise mix
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 Place

•Large, long-term commitment of

resources

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•Location will affect future growth `

•Local environment may change

over time
 Location
Location
Decisions
Decisions

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Freestanding
Freestanding Mall
Mall
Store
Store

Shopping
Shopping
Center
Center
 Price

Low Price High Price

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Quality
Good Value Image

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 Retailers Classified by Margin & Turnover

High Margin

High-Margin/ High-Margin/
Low-Turnover High-Turnover
` Low Retailers Retailers `
High
Turnover Turnover
Low-Margin/ Low-Margin/
Low-Turnover High-Turnover
Retailers Retailers
Low Margin

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 Margin & Turnover
High Margin

Excellent position
to withstand a
` Low competitive attack `
High
Turnover Turnover
Least able to
withstand a
competitive attack
Low Margin

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 Promotion

Advertising
Advertising

Public
Public Relations
Relations
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Publicity
Publicity
Retail
Retail
Promotion
Promotion
Strategy
Strategy Sales
Sales Promotion
Promotion

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 Physical Facilities & Personnel

Employee
Employee Type
Type &
& Density
Density

Merchandise
Merchandise Type
Type &
& Density
Density
` Fixture `
Fixture Type
Type &
& Density
Density

Factors
Factors Sound
Sound
in
in
Creation
Creation Odours
Odours
of
of aa Store’s
Store’s
Atmosphere
Atmosphere Visual
Visual Factors
Factors

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 PERSONNEL OF THE RETAIL STORE

How
How many
many

How
How knowledgeable
knowledgeable
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How
How helpful
helpful // invasive
invasive

Factors
Factors Fit
Fit the
the image
image of
of the
the product
product
in
in
Personnel
Personnel
decisions
decisions Good
Good personal
personal sellers
sellers

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 Personalized Services

• To consistently meet customers expectations, you

need to provide them with excellent customer
service

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• Through customer service, a retailer can
differentiate its offering & build long term
competitive advantage

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 Amount of Service

• Self-Service Retailers:
– Serve customers who are willing to perform their own “locate-compare-
select” process to save money.
• Limited-Service Retailers:
– Provide more sales assistance because they carry more shopping 
goods about which customers need information.
` • Full-Service Retailers: `
– Usually carry more specialty goods for which customers like to be 
“waited on.”

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 MOTIVES FOR PATRONIZING A
STORE
• General Store Characteristics
– Reputation in the community
– Number of stores in the area
– Friends’ perception of the store
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• Physical Characteristics
– Store layout & décor
– Fixtures
– Lighting
– Displays
– Cleanliness
– Color scheme
 • Convenience
– Time required to reach the store from customer’s
location
– Efficiency in check-out
– Time saving store layout
– Parking
• Merchandise
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– Variety
– Dependability
– Quality
• Price Policy
– Price levels charged for various merchandise
– Value of merchandise
 • Store Personnel
– Courteous
– Friendly
– Helpful
– Knowledgeable
• In store Effects
– POP displays
` – In store advertising `

• Customer Service
– Transaction efficiency
– Credit
– Return policy
– Deliveries
– Alterations