· Web view1. The discounter (Subhiksha, Apna Bazaar, Margin Free) 2. The value-for-money store (Nilgiris) 3. The experience shop (Foodworld, Trinethra) 4. The home delivery (Fabmart)

A study on Impact of Organized Retailer on Unorganized RetailerMr. Mitul Deliya1, Mr. Bhavesh Parmar2, Dr. K. K. Patel3

#1 Assistant Professor, S. K. College of Business Management, HNGU, Patan

Mo. 093280 73474 E-mail ID :- [email protected]

#2 Assistant Professor, Dept. of Busi. Management, S. P. College of Engineering., Visnagar


#3 Assistant Professor, S. K. School of Business Management, HNGU, Patan


Abstract

The retail sector is expanding and modernizing rapidly in line with India’s economic

growth. It offers significant employment opportunities in all urban areas. Unorganized

retailers in the vicinity of organized retailers experienced a decline in their volume of

business and profit in the initial years after the entry of large organized retailers. The adverse

impact on sales and profit weakens over time. There was no evidence of a decline in overall

employment in the unorganized sector as a result of the entry of organized retailers. The rate

of closure of unorganized retail shops in gross terms is found to be 4.2 per cent per annum

which is much lower than the international rate of closure of small businesses. The rate of

closure on account of competition from organized retail is lower still at 1.7 per cent per

annum. There is competitive response from traditional retailers through improved business

practices and technology up gradation. A majority of unorganized retailers is keen to stay in

the business and compete, while also wanting the next generation to continue likewise. Small

retailers have been extending more credit to attract and retain customers.

Keywords :- Retailing, Unorganized Retailers, Organized Retailers

What is Retailing?1

Retailing is defined to include all the business activities relating to selling of goods and

services to the final consumers. It is the final link in a product supply chain.

1 Book ‘Retail Management’ by Barry berman & Joel R.Evans, 10th edition

1

mailto:[email protected]

Retailer is a person or agent or agency or company or organization which is instrumental in

reaching the goods or merchandise or services to the end user or ultimate consumer. Often people

think of retailing only as the sale of products in stores. But retailing also involves sale of services:

overnight lodging in a hotel, a haircut or a home deliver pizza.

Retailing involves a direct interface with the customer and the coordination of business

activities from end to end-right from the concept or design state of a product offering to its delivery

and post delivery service to the customer. The industry has contributed the economic growth of many

countries and is undoubtedly one of the fastest changing and dynamic industries in the world today.

Structure of the Retail Industry in India 2

The retail industry continued in India in the form of Kiranas till 1980. Soon, following the

modernization of the retail sector in India, many companies started pouring in the retail industry in

India like Bombay Dyeing, Grasim etc. As has been mentioned earlier the retail sector in India can be

widely split into the organized and the unorganized sector. The unorganized sector is predominant.

We may discuss in detail the different divisions of the retail sector in India.

Unorganized Retail Sector

The unorganized retail sector basically includes the local kiranas, hand cart, the vendors on

the pavement etc. This sector constitutes about 98% of the total retail trade. But Foreign Direct

Investment in the retail sector is expected to shrink the employment in the unorganized sector and

expand that in the organized one.

Organized Retail Sector

In the organized sector trading is undertaken by the licensed retailers who have registered

themselves to sales as well as income tax. The organized retail sectors have in their ambit, corporate

backed hypermarkets and retail chains. The private large business enterprises are also included under

the organized retail category. The organized retail sector can be further subdivided into:

In store Retailers

This type of retail format is also known as the brick and mortar format. These retail stores are

in the form of fixed point sale outlets. They are specially designed to lure the customers. There are

different types of stores through which the in store retailers operate. Branded Stores appear in the

form of exquisite showrooms. Here the total range of a particular brand is available and the quality of

the product is certified by the government. There are also multi brand specialty stores that sell a series

2 Source:- (http://business.mapsofindia.com/india-retail-industry/)2

of brands so that the consumer can choose from the wide array of brands. Department stores have a

large number of brands and products catering to all basic needs to luxurious items as well.

Supermarkets are basically self service retail stores. Discount Stores offer commodities at reduced

prices. In Hyper Marts customers have wide variety of products to choose from and they are also

available at discounted rates. Convenient stores are located in prominent places within the reach of

majority of the customers and do not operate in stringent work hours. Shopping Malls are a

storehouse of a large variety of retail shops situated close to each other.

Retail Formats in India

The retail formats in India can be categorized into the traditional and the modern forms. The

traditional format includes Kiranas, street markets, kiosks and multiple brand stores. The modern

format, on the other hand includes supermarkets, hypermarkets, department stores and specialty

chains. In discussing about the structure of the retail sector in India we cannot forgo forecourt

retailing and trade parks

Trade parks

Trade parks are basically business complexes that promote international trade. The global

players here have access to the top Indian exporters. To the buyers this would prove to be a boon

since they do not have travel to far off towns to enter into business deals with the exporters, especially

in places where infrastructure is very poor. By this the exporters not only enhance their visibility but

they also enjoy a host of other advantages. They can design libraries, studio etc, in order to attract

potential customers.

Forecourt Retailing

This type of retailing is done by the oil companies in order to increase their revenue. They not

only deliver fuel but also offer other services to its customers.

Top 10 Indian Retail players:1. Pantaloon Retail 2. K Raheja Group 3. Tata group

4. RPG group 5. Landmark group 6. Piramal Group

7. Subhiksha 8. Bharti-Walmart 9. Reliance

10. AV Birla Group

FOOD RETAIL IN INDIA

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Though with a population of a billion and a middle class population of over 300 millions

organized retailing (in the form of food retail chains) is still in its infancy in the Country. India has

been rather slow in joining the Organized Retail Revolution that was rapidly transforming the

economies in the other Asian Tigers. This was largely due to the excellent food retailing system that

was established by the kirana (mom-and-pop) stores that continue meet with all the requirements of

retail requirements albeit without the convenience of the shopping as provided by the retail chains;

and also due to the highly fragmented food supply chain that is cloaked with several intermediaries

(from farm-processor-distributor-retailer) resulting in huge value loss and high costs. This

supplemented with lack of developed food processing industry kept the organized chains out of the

market place. The correction process is underway and the systems are being established for effective

Business-to-Business (farmer-processor, processor-retailer) solutions thereby leveraging the core

competence of each player in the supply chain.

Spread of Organized Retailing in India

Organized retailing is spreading and making its presence felt in different parts of the country.

The trend in grocery retailing, however, has been slightly different with a growth concentration in the

South. Though there were traditional family owned retail chains in South India such as Nilgiri’s as

early as 1904, the retail revolution happened with various major business houses foraying into the

starting of chains of food retail outlets in South India with focus on Chennai, Hyderabad and

Bangalore markets, preliminarily. In the Indian context, a countrywide chain in food retailing is yet to

be established as lots of Supply Chain issues need to be answered due to the vast expanse of the

country and also diverse cultures that are present.

Retail Models in India: Current & Emerging

The Indian food retail market is characterized by several co-existing types and formats. These are:

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1. The road side hawkers and the mobile (pushcart variety) retailers.

2. The kirana stores (the Indian equivalent of the mom-and-pop stores of the US), within which

are:

a. Open format more organized outlets

b. Small to medium food retail outlets.

Modern trade – the organized retailers

Within modern trade, we have:

1. The discounter (Subhiksha, Apna Bazaar, Margin Free)

2. The value-for-money store (Nilgiris)

3. The experience shop (Foodworld, Trinethra)

4. The home delivery (Fabmart)

While the focus of this note is on modern organized retail trade, we hereunder present insights into the

smaller, semi and unorganized retailers.3

Hawkers – ‘mobile supermarkets’

The unorganized sector is characterized by the lari-galla vendors (also known as “mobile

supermarket”) seen in every Indian bylane and is, therefore, difficult to track, measure and analyze.

But they do know their business – these lowest cost retailers can be found wherever more than 10

Indians collect – a rural post office, a dusty roadside bus stop or a village square. As far as location is

concerned, these retailers have succeeded beyond all doubt. They have neither village nor city-wide

ambitions or plans – their aim is simply a long walk down the end of the next lane. This mode of

“mobile retailers” is neither scalable nor viable over the longer term, but is certainly replicable all

over India. Most retailing of fresh foods in India occurs in Mandis and roadside hawker parks, which

are usually illegal and entrenched. These are highly organized in their own way. Hawking of food

products, cooked food and FMCG products is a very interesting model of retailing. Much has been

written about these roadside “malls” – from social security issues to their nuisance value. However, if

you put these hawkers together, they are akin to a large supermarket with little or no overheads and

high degree of flexibility in merchandise, display, prices and turnover. While shopping ambience and

the trust factor maybe missing, these hawkers sure have a system that works.

Kirana/Grocers/ Provision Stores/Mom-and-Pop Stores

Semi-organized retailers like kirana (mom-and-pop stores), grocers and provision stores

arecharacterized by the more systematic buying – from the mandis or the farmers and selling – from

3 Vijay Anand & Vikram Nambiar Research project report:- INDIAN FOOD RETAIL SECTOR IN THE GLOBAL SCENARIO

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fixed structures. Economies of scale are not yet realized in this format, but the front end is already

visibly changing with the times. These stores have presented Indian companies with the challenge of

servicing them, giving rise to distribution and cashflow cycles as never seen elsewhere in Asia. The

model is very antithesis of modern retail in terms of the buyer (retailer)-seller (FMCG) equations. It is

not unknown for MNC leaders to link the supply of one line of products to another slower moving

line of products.

LITERATURE REVIEW

According to Cherish Mathew (2009), “Aggressive expansion by organized retailing has, in

turn, promoted certain political, legal and social issues, raising apprehensions about the future of

traditional/unorganized retailing. When compared with the unorganized sector, organized retailing is

expected to provide several benefits to the customers as well as suppliers and would contribute

signification to the nation’s economic development in the long run. The retail structure in India

expected to settle at a new equilibrium, accommodating both the organized and unorganized retailer.

As the government’s intervention in the retail business is likely to reduce in future, customer

preferences and market forces will determine the eventual outcome. The overall attitude likely to

change favorably towards organized retailing and the socio-political resistance expected to subside.

Organized retail is unlikely to be a threat to existing players, but would be an emerging business

opportunity for local, global, and nation player in India, to the mutual benefits of all concerned.

According to V. Ramanathan (2008), Customer relationship management is very useful if it

work effectively with reference to the retailing sector in India. It allows retailers to gather customer

data swiftly, identify the most voluble customers over time, and increase customer loyalty by

providing customized products and services. It also reduces the cost of serving these customers and

makes it easy to acquire similar customer future. It has become customary for companies to talk about

selling solutions rather than products or services. In retailing, focusing on solution will mean

employing CRM to help customers to make their retail buying activities more comfortable.

According to Piyush Kumar Sinha & Sanjay Kumar Kar (2007), India’s retail development is

inevitable. Most of the organized retailers in India are harping on quality, service, convenience,

satisfaction and assured benefits to lure shoppers into the store. Retailers should create value for the

consumer and must decide suitable vehicle to deliver desired consumer value. No doubt, that retail

format is one of the vehicles to deliver value proposition and it helps to position the store in the mind

of target shoppers. Retailers need to find out what matches consumer requirement and offer better

than competition. Retailers certainly need to be innovative in designing the value proposition and

deciding the format to deliver that to the consumer. It is not all about deciding the format but all about

serving the consumer better, faster and at less cost. Retailers can use their store as an indicator of what

they stand for and what value they offer. Retailers have to out think consumer in providing service 6

and value. Now, most of the retailers are concerned about growth in number of stores rather than

creating value for consumer.

According to Piyush Kumar Sinha (2007), the demand from the convenience-seeking

shoppers, technology, competition and urge to growth leads the retailer to adapt the multiple format

modes. The development will no doubt bolster the retailer's power in market creating positive synergy

across the formats. However, at the same time, it brings with more responsibility to the retailer, as

shoppers are going to interact and judge the value offering dissimilar shopping occasion and

environment. The value delivery mechanism of the retailer need to be consistent and reinforcing to

maximize its brand equity, failing which, it stands the risk of dilution. The opportunity lies in the fact

that, retailers of a particular format appear to be increasingly successful in attracting customers from a

widened variety of formats. Electronic retailing created a huge scope for the store-based retailer to

reach out to a large customer base, overcoming the physical distance, by using technologically driven

formats. Converting the threats into opportunities, the pure e- retailers are opening physical format

and there by complementing the existing operation. It also in turn helps in operational and financial

efficiency through economies of scale and greater bargaining power against the manufacturers. The

scope of positive synergy in terms of brand, customer, merchandise and marketing activities are very

much a reality in retailing.

According to Abhishek Anand (2008), the retailers need to give their customers a more

personalized shopping experience. This requires a complete study of individual consumer behavior.

The retailers should continue to benefit from the cost advantage and the variety they offer to the

customers.

According to Mulky & Nargundkar (2003), The Indian retail sector is largely traditional, but

stores in modern format are emerging. The contribution of organized retailing in the share of retail

sales in India is currently very small. Based on an analysis of retail developments in countries such as

Thailand, Brazil and Greece, and some experience in India, it is possible to conclude that

modernization of retailing in India would be influenced by some important factors. These factors

include economic development; improvements in civic situation; changes in consumer needs, attitudes

and behavior; changes in government policies; increased investment in retailing and rise in the power

of organized retail. Modern retail will have several implications for managerial practice in

manufacturing firms. Firms will need to proactively review and their sales structures, brand activities,

logistics policy and price structure to cope with pressures from powerful retailers.

According to V Ramanathan (2009), the unorganized retailers need to be responsive to the

competitive retail market dynamics created by the organized retail formats in order to sustain their

business and serve their target customers in a profitable manner. The change process requires the

unorganized retailers to reshape their existing business practices of dealing in a limited variety of

product alternatives to offering the complete assortment in the product categories handled by them.

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This `category killing' approach would become imperative for the continued survival of unorganized

retailers. If the unorganized retailers adopt this approach, together with the various forms of

convenience that they already offer, they would be able to stand up to the competition from the

organized retail formats.

According to R.K.srivastava(2008) , Presented show that malls more developed in the North

and West part of India. Food, groceries and apparel purchase by customers contributed to 52 percent.

On average 75 percent of customers spend about 1-3 hours in the mall. Malls with multiplexes such as

cinema theatres, food courts, play places for children are becoming the centre for family outings.

Small retailers have improved their service to cater to Indian consumers. Credit limits and home

service are helping them to hold on to their customers. Retailing focus is changing towards satisfying

the different hierarchy of needs of customers.

By Aarkstore.com(2008) , Provides an introduction to the Indian food retail industry, including the

country’s changing consumption habits, its domestic and international potential and the benefits for

manufacturers entering this market. Also focuses on India’s commercial food retailing sector,

including the impact of the arrival of US giant Wal-Mart and its joint-venture plans with Bharti

Group, and a look at the other key existing and upcoming players and who will battle to obtain share

of this market.

According to leela rani(2006) Six of the independent variables considered, namely, shopping

attitude of respondent, store loyalty (SL), perceived store prices, store distance, shopping frequency,

and brand loyalty (in order of importance of impact) significantly influenced consumers’ attitude

towards retail store in out-of-stock.

According to Anirban Sengupt (2008) Emergence of modern retail in India is not just a result

of increasing consumer buying power – manufacturers and unorganized retailers also have an

important role to play in this process at the macro-level. At the micro-level, the trigger came from

diverse angles like entrepreneurial desire to provide better service to consumers, social desire to

provide relief to the masses in the form of lower prices, desire to capitalize on emerging business

opportunities being provided by the changing business environment, etc

Research Objective

To study on impact of organized retailer on unorganized retailer.

Sub objectives:

To analyze factors make an impact on organized as well as unorganized retailing.

To study on different services provided by retailer.

To study on impact of turnover / margin of traditional retailer after the coming

organized retailer.

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To study the changes mode taken by traditional/unorganized retailer after coming

organized retailer.

To study tailor made strategies adopted by unorganized retailers of Ahmedabad city to

defend against organize retailers.

Hypothesis :-

H1: Location and business change are independent of each other.

H2: Business running year and business change are independent of each other.

H3: Cost cutting strategy and business location are independent of each other.

H4: Offer discount strategy and business location are independent of each other.

H5: Minimize staff strategy and business locations are independent of each other.

H6: Increased numbers of brand and business locations are independent of each other.

H7: Better display and business locations are independent of each other.

H8: Introduced self services and business locations are independent of each other.

H9: Improved home delivery and business locations are independent of each other.

H10: Increased store space and business locations are independent of each other.

Sample Method : Non probability-convenient sampling method

Population : Unorganized retailer in Ahmadabad city

Sample size : 200 unorganized retailers of Ahmedabad city

Data Collection Tool : Questionnaire

Data Collection Method : Survey

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Data Analysis and Interpretation

In this graph we can analyze impact of organize

retail on unorganized retail. We have analyze

total customer base of unorganized retailers

before existing of organize retailers. We have

also generated data of total customer who tacks

daily visit in their shop.

From above graph we can see that 46.5% of

retailers say that 50 to 100 customer tacks daily

visit before existing organize retailers. And

which is slightly decreased after coming organize retailers. Here we can see that overall

impact is negative.

Here in this graph we can see that maximum number of respondent gives first rank to middle

class people. And second rank

is given to upper class people.

So it shows that unorganized

retailers are more depending on

middle class people. More

short of loyal customer are

coming from this class. Most

important thing is that in India

major part of population lies in

middle class, so therefore traditional retailing have middle class customer base.

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Here 62% of respondent say that their business is decreased due to organize retailers. Only

38% respondent feels no effect due to organize retailers. Here 44.5% of respondent feels that

their business decreased by 5 to 10% because of organize retailer. And 16.5% of respondent

feels that their business is decreased by 0 to 5% only because of organize retailers.

Impact on particular product.

In this graph 63.4% of respondent tells that the seals of process packaged food are decreased.

Maximum number of respondent feels that the seals of this commodity decreased due to organize

retailers. The second rank comes of cooking oil, ghee and vanspati and 57.8% of respondent feels that

the seals of cooking oil, ghee and vanspati are decreased. 87% of respondent feels no impact of

organize retailers on sales of rice, atta, wheat, milk, bread, and eggs.

POS/ computerized billing user

Currently not used Currently used

Want to use in future no need Improvement Total

62 74 136 64

Out of total respondents, 32% of respondents are using computerized billing

technology in their shop. Few of our respondents do not need to use computerized billing

method. It is only because they all referred to use traditional methods of billing. Only 31% of

respondents willing to use computerized billing methods in future. It is only because kinds of

work load they are facing in day to day work. So it is advisable to use computerized billing

methods in their shop.

Credit card machine


Want to use in future no need Improvement Total

41 149 190 10

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Only 5% of the respondents are using credit card machines in their shops. This shows

that regular and loyal customers of unorganized retailers are not habituate to use credit cards

while they purchase from unorganized retailers. Only 20% of the respondents willing to use

credit card machine in future.

Scanning/ bar coding User


Want to use in future no need Improvement total

64 118 182 18

Only 9% of our respondent are using bar coding machine technology in their day to

day transaction. 59% of respondents do not feel to use this kind of technology in their shops.

32% of respondents want to use these kinds of technology in future because of kinds of work

load they are facing in their day to day transactions.

Computerized accounting, inventory control (software)



46 136 182 18

Only 9% respondent are using inventory control system and which was expected.

Only 23% of respondents feels need have inventory control system in future. Because they

feel that their inventory management is not so much effective in planning and controlling of

inventory of their shops.

Electrical equipment e.g. refrigerator, freezer, hot case



50 36 86 114

Total 57% of respondents are using electronic equipments in their shops. There are

only few shops which are not yet using electronic equipments in their shops. Only 25% of

respondents feel to use electronic facility in future. Because they all wants to implements this

kinds of latest technology in near future.

Electronic weighing machine



23 4 27 17312

It is difficult to find out retailers who are not using electronic weighting machines.

Throughout our research we found only 13% of respondents who is using traditional method

of weighting. 87% of respondents are using electronic weighting machine in their day to day

tractions. This was expected from our research. Because it is common in city like Ahmadabad

that retailers use this kind of facility in their shops.

Strategies which adopted by Retailers

Strategy Average Penetration

Cost Cutting 1.405

Offer Discount 1.445

Minimize staff 3.54

Increased number of brand 2.485

Better display 2.585

Introduced self services 3.59

Improved home delivery 3.125

It is so common thing that people likes to implement different kinds of strategies to survive in

cut through competition. Here we have asked different kinds of question to our respondent to know

what kinds of strategies they are following to survive in competition. Through our research we came

to know that our respondent mostly prefer to implement strategies like cost cutting and offering

discount to attract customers or to survive in competition. Respondents are average prefer strategies

like increased number of brand and better display.

Perception of Unorganized Retailers regarding Organized Retailers

Statement regarding to organized retailing Average Penetration

I have a set of loyal/regular customers that will not change even if new, more organized retailer come in city.

1.75

I believe in making changes required to satisfy my customer 1.51

I would like to introduce new methods of customer services since customer relationship is the most important thing for growth of a business

2.03

Technology cannot add much value to my business 1.47

I do not think making my store more modern will enhance my business in any way.

2.03

I would like to change my store by doing up the interiors with better shelving, lighting, display, etc

2.43

I can concentrate on local advertisement in my area for increase awareness

3.48

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I will develop my own strategies to attract & retain my customers against organized retailer.

2.11

Customers demand is due to org. retailing changed, but I can able to satisfy them.

3.27

Hypothesis Testing

H1 : Location and change in Business is independent to each other.

2 = 14.37 (Calculated Value), DF = 8, at 5% signification level table value is 15.507.

So from above calculation chi-square calculated value is lower than tabulated value so Null

hypothesis will be accepted. So it can be concluded that Location and business change are

independent of each other.

H2 : Business running year and business change is independent to each other.

2 = 7.50 (Calculated Value), DF = 4, at 5% signification level table value is 9.488. So

from above calculation chi-square calculated value is lower than tabulated value so Null

hypothesis will be accepted. From the above calculation it can be concluded that Business

running year and business change are independent of each other. .

H3 : Cost and Location is independent to each other.

2 = 24.93 (Calculated Value), DF = 12, at 5% signification level table value is

21.026. So from above calculation chi-square calculated value is higher than tabulated value

so Null hypothesis will be rejected. From the above calculation it can be concluded that Cost

and Location is dependent of each other. .

H4 : Offer Discount and Location is independent to each other.



so Null hypothesis will be rejected. From the above calculation it can be concluded that Offer

Discount and Location is dependent of each other. .

H5 : Minimize staff and Location is independent to each other.



so Null hypothesis will be rejected. From the above calculation it can be concluded that

Minimize staff and Location is dependent of each other. .

H6 : Increase number of brand and Location is independent to each other.


26.296. So from above calculation chi-square calculated value is lower than tabulated value

14

so Null hypothesis will be accepted. From the above calculation it can be concluded that

Increase number of brand and Location is independent of each other. .

H7 : Better Display and Location is independent to each other.




Better Display and Location is dependent of each other. .

H8 : Introduced Self Services and Location is independent to each other.




Introduced Self Services and Location is dependent of each other. .

H9 : Improved Home Delivery and Location is independent to each other.




Improved Home Delivery and Location is dependent of each other. .

H10 : Increased Store Space and Location is independent to each other.




Offer Discount and Location is independent of each other. .

Findings 1. From this research we found that 46.5% of retailers say that 50 to 100 customer tacks

daily visit before existing organize retailers. And which is slightly decreased after

coming organize retailers.

2. During our research we come to know that maximum middle class people takes more

visit in unorganized retail sector. Second rank is given to lower class by our

respondents.

3. 62% of respondent say that their business is decreased due to organize retailers. Only

38% respondent feels no effect due to organize retailers. Maximum number of

respondent feels that the sales of this commodity decreased due to organize retailers.

15

4. 63.4% of respondent tells that the sales of process packaged food are decreased. The

second rank comes of cooking oil, ghee and vanspati and 57.8% of respondent feels

that the sales of cooking oil, ghee and vanspati are decreased. 87% of respondent feels

no impact of organize retailers on sales of rice, atta, wheat, milk, bread, and eggs.

5. Out of total respondents, 32% of respondents are using computerized billing

technology in their shop.

It is surprisingly to know from our research that only 5% of the respondents are

using credit card machines in their shops.

9% of our respondent are using bar coding machine technology in their day to day

transaction. 59% of respondents do not feel to use this kind of technology in their

shops.

9% respondents are using inventory control system and which was expected.

We found only 13% of respondents who are using traditional method of

weighting. 87% of respondents are using electronic weighting machine in their

day to day tractions

6. Total 57% of our respondents are using electronic equipments in their shops. There

are only few shops which are not yet using electronic equipments in their shops. This

was surprising for us throughout our research.

7. Unorganized retailer mostly realize on their loyal customers. They generally provide

credit facility to their loyal customer. 58% of respondent gives credit to their

customers.

8. Most of the respondent feels that home delivery services makes customer more loyal

with their shop. 62% of respondent give home delivery to their customer. Among

them 75.8% of respondent give home delivery to their loyal customer only.

9. Our respondent mostly prefer to implement strategies like cost cutting and offering

discount to attract customers or to survive in competition. Respondents are average

prefer strategies like increased number of brand and better display. The main reason

behind this may be that it less attract middle class person.

ConclusionThe growth of organized retail will have a positive multiplier effect on the Indian economy.

Organized retail would benefit society at large, more so the end consumers -- in terms of

better product choices and price – and farmers because of higher and more stable price 16

realization for their produce. More employment opportunities will be generated. Present

systems, IT and processes will improve because of investments in infrastructure that are

likely to be made by organized retailers. The robust sourcing and distribution network of

large retailers would certainly help make the supply chain more efficient.

However, that both modern and traditional retailers will co-exist in India for some

time to come, as both of them have their own competitive advantages. The kirana has a low-

cost structure, convenient location, and customer intimacy. Modern retail offers product

width and depth and a better shopping experience. With the Indian economy currently

growing approximately 9 per cent annually, rising consumption and the low per capita

availability of retail space in India. There is room for both modern and traditional retail in

India for several generations to come.

Unorganized retailers follow their own strategies to maintain their customer base.

They more stick to satisfy their more short of loyal customer by providing various facilities

like credit facility, free home delivery, etc. one more thing which is most important behind

wining customers trust is that unorganized retailers are giving surety on purchase of any

kinds of goods. The second most important thing behind loyalty of customers is kind

behavior and helpful nature of unorganized retailers.

Finally, organized retail is creating quality labour class that is gaining vocational

training in skilled and unskilled jobs at graduate and tenth plus levels. Nevertheless, there is a

timely need for a fresh regulatory framework and competition policy so that both traditional

retail and modern retail can continue to grow in harmony eventually closing the gap between

the organized and unorganized sector.

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situations” Asia Pacific Journal of Marketing and Logistics Vol. 20 No. 3, 2008

R.K. Srivastava (2008) “Changing retail scene in India” International Journal of Retail &

Distribution Management Vol. 36 No. 9, 2008

Anirban Sengupta (2008) “Emergence of modern Indian retail: an historical perspective”

International Journal of Retail & Distribution Management Vol. 36 No. 9, 2008

Anand Abhishek (n.d) “Formats v/s Feelings (Organized retailing v/s MOM & POP stores)”

Indian institute of management, Indore – Batch of 2008

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Documents

· Web view1. The discounter (Subhiksha, Apna Bazaar, Margin Free) 2. The value-for-money store (Nilgiris) 3. The experience shop (Foodworld, Trinethra) 4. The home delivery (Fabmart)