31

CHAPTER – 2

LITERATURE REVIEW, RESEARCH DESIGN AND METHODOLOGY

LITERATURE REVIEW

Retail supply chain is a contemporary and evolving field which is a

culmination of two different areas of management, namely, supply chain

management and retailing. Even though there are many refereed papers in the

area of supply chain management and retailing, there are not many research

papers/articles in the area of retail supply chain, especially food retail. Moreover,

most often the research papers cover a specific topic such as the relevance of

Radio Frequency Identification (RFID) systems in food supply chain, customer

behaviour in a food and grocery etc.

In India, supply chain management with respect to organised retail is gaining

importance of late only. And scouring for research papers in the area of food retail

supply chain with reference to Indian context is a herculean task. In spite of the

paucity of literature in the specific field, a humble attempt is made to unearth the

research papers/articles relevant to the research study.

Retail Supply Chain

The study by Bourlakis, Michael and Bourlakis, Constantine (2006)32

focussed on the integration process of retailer’s information technology strategy

with logistics strategy and to find out those aspects of the retailer’s distribution and

operational performance that are mostly influenced via that integration.

The findings show that logistics and information technology strategies are

developed and implemented in a parallel way by both local and multinational food

retailers. A financial ratio analysis carried out for these firms suggests that

multinational firms possess greater operational efficiency at both secondary and in-

32 Bourlakis, Michael and Bourlakis, Constantine (2006), “Integrating logistics and information technology strategies for sustainable competitive advantage”, Journal of Enterprise Information Management, Vol. 19 No. 4, pp. 389-402.

32

store distribution operations compared to domestic firms. This is largely attributed

to the integration of logistics and information technology operations. Multinational

firms superior operational efficiency also contributes for a higher profitability

performance.

Leigh Sparks (2006)33 gave a detailed account of the evolution of retail

supply chain management in his paper. He discussed a number of changes that

are taking place in modern retail supply chain in direct response to the changing

demands of consumers. He also explained how these changes prompt a number of

implications for the management of the retail supply chains.

That logistics is an important component of modern supply chain

management needs no emphasis. Logistics may be external or internal to the retail

outlets. Kotzab (2005)34 shows the importance of logistics in (instore) an outlet.

Through his empirical study, Kotzab proves the importance of instore

logistics as a key determinant on the success of retail business. In the model, he

has included the logistics processes that are carried out within a retail outlet

ranging from incoming dock to the checkout as the in-store logistics.

As part of the study, Kotzab interviewed 202 store managers from three

different kinds of stores namely supermarkets, small hypermarkets and large

hypermarkets.

Seyed-Mahmoud Aghazadeh (2004),35 in his paper explores ways of

improving logistics and distribution supply chains of the food retail industry. The

paper explains the concepts of logistics and supply chain as well as the new

33 Leigh Sparks, “Changing Scenario – In tune with consumer demands, retail logistics and supply chains are undergoing major changes”, Retail Biz, June 2006, pp 21-23.

34 Herbert Kotzab, Frederiksberg and Christopher Teller (2005), “Development and Empirical Test of a grocery retail instore logistics model, British Food Journal, Vol. 107 No. 8, pp. 594-605. 35 Seyed-Mahmoud Aghazadeh (2004), “Improving logistics operations across the food industry supply chain”, International Journal of Contemporary Hospitality Management. Volume 16 No. 4, pp 263-268.

33

challenges in the food industry. The paper also discusses the successes and

failures of the industry. The results reveal slow progress in accomplishing the goals

of leaner supply chains and easier distribution. The study discusses how consumer

driven, time-phased planning provides solutions to these challenges such as

including the consumer in the supply chain planning process, managing product life

cycles, promotional planning, planning for seasonal products, integrating with

category management, determining cost-effective supply channels and planning

capacities at the store level.36

Shopping behaviour

Shopping behaviour is an important phenomenon. The next two papers

discuss the shopping behaviour of the consumers.

Customers usually buy their requirements once a month (regular purchase)

and also when they exhaust requirements (emergency purchases). In his research

paper, Nordfalt, Jens (2009)37 views shopping trip as either a (more or less)

contingency-dependent construction or as the execution of a well-defined

behaviour and proves that larger (major) trips are more well defined, whereas

smaller (fill-in) trips are found to be largely contingency dependent constructions.

Bawa Kapil and Ghosh Avijit (1999)38 present a model of shopping

behaviour based on the assumption that households seek to minimize the travel

cost associated with shopping and the cost of holding goods in inventory. They

prove a point that the relationship between household characteristics and shopping

behaviour can be fairly complex – for some households shopping may have a

recreational aspect while for others it may compete directly with wage-earning

activity.

36 “Improve Profits, Competitiveness & Satisfaction with a 'High Performance' Retail Supply Chain”, Nuthink, Inc. 2001. 37 Jens Nordfalt, “Unplanned grocery purchases: the influence of the shopping-trip type revisited”, Journal of Consumer Behaviour, Volume 8, 2009, pp 1-13. 38 Bawa Kapil and Ghosh Avijit (1999), “A Model of Household Grocery Shopping Behaviour”, Marketing Letters, Volume 10 No. 2, pp 149-160.

34

Private Labels

When customers buy their requirements they buy both branded as well as

private labels. The first paper presents the growth of private labels in different

countries and the factors influencing the growth of private labels. The second

paper tries to distinguish international, national or regional private brands. The

paper gives an account of the national brands and the private labels. The third

paper gives a new dimension to the customer’s buying behaviour of private labels.

The growth of private labels is enormous over the past few years in many

countries and in particular, countries such as Germany, Belgium, the UK, Austria

and Spain. The private labels amount to nearly 40% in these countries. Retailers

resort to produce their own private labels because of high margins, to outsmart the

national brands, to gain control over shelf space, to introduce lower prices to

consumers by controlling the costs and to gain bargaining power with

manufacturers etc. (Altintas et al, 2010).39

Walsh, Gianfranco and Mitchell, Vincent-Wayne (2010)40 observed that

private label brands enjoy growing popularity and are increasing in both their

quantity and quality, they continue to attract the attention of scholars and

practitioners. One major shortcoming of previous research is that it focuses on

price as the dominant driver of buying intentions. The findings of the study reveal

that brand consciousness and attitude instead play a role on the intention to buy

private label brands.

Cheng et al (2007)41 research study concentrates on the question how do

customers perceive the differences between national brands, international private

labels and local private labels? The study finds that national brands lead private 39 Murat Hakan Altıntas, Serkan Kılıc and Gokhan Senol (2010), “Strategic objectives and competitive advantages of private label products - Manufacturers’ perspective”, International Journal of Retail & Distribution Management Vol. 38 No. 10, pp. 773-788. 40 Walsh, Gianfranco and Mitchell, Vincent-Wayne (2010), “Consumers’ intention to buy private label brands revisited”, The Braybrooke Press Ltd. Journal of General Management, Volume 35, Issue 3. 41 Cheng J M, Chen L S, Lin J Y and Wang E S (2007), “Do consumers perceive differences among national brands, international private labels and local private labels? The case of Taiwan”, Journal of Product & Brand Management Vol. 16 No. 6, pp. 368–376

35

labels on most dimensions of customer perceptions and the study finds very little

difference in consumers’ price perceptions between national brands and

international private labels. However, in the case of convenience goods,

international private labels are found superior in quality compared to local private

labels and consumers are willing to pay more for the former. At the same time, with

respect to shopping goods even though they find the international private labels

are superior in quality than the local private labels, they are not willing to pay more

for the same.

Miranda M J et al (2006)42 in his research paper brings forth the effect of

stock-out on the behaviour of the customers in buying. He studied the effect of

stock-out on buying behaviour of the customers, and found that the age, family size

and the kind of customers determine whether the customer goes for variant of the

same brand or prefers a different brand or obsessive enough to go for the same

brand in another outlet. Also, the paper suggests the strategies for the retailers to

be followed to overcome the situation such variances in customer preferences.

Customers habits are changing. While the customers by and large make

purchases by visiting the retail chain, some also buy online. The following paper

lists the parameters that influence online customers.

Online grocery shopping by consumers was studied by Morganosky M.A.

(2000).43 The study found that the online users are of age less than 55 years.

Convenience and time saving are the most important factors influencing them to go

for online purchase. Some attributed the physical inability or physical constraints as

the reasons to go for shopping online.

Supply Chain Efficiency

Supply chain management holds the key for success in modern retailing. As

such, it is appropriate to know how the supply chain affects the retailers. The

42 Miranda M J, Kandiah J (2006), “Family Size Underpins Grocery Shoppers’ Behavioural Response to Stock-outs”, Journal of Marketing Channels, Vol. 14(1/2), pp. 97-115. 43 Morganosky, M. A. and Cude B. J. (2000), “Consumer response to online grocery shopping”, International Journal of Retail & Distribution Management, Vol. 28 No. 1, pp. 17-26.

36

following two papers bring forth the efficiency of supply chain in enhancing the

store image.

Avirat Sonpal (2006)44 states that retail supply chain efficiency is all about

learning what the customer needs and then actively working to fulfil those needs

through sourcing, merchandising and product development mechanisms. The

author enumerates the benefits of effective supply chain management in retailing.

Steckel (2004)45 using simulation models shows how the changes in the

order and delivery cycles, availability of shared Point-of-sale (PoS) information and

the pattern of customer demand affect the supply chain efficiency. The paper is

based on “beer game” simulation. He proves that speeding up of the cycle time is

always beneficial. But at the same time, the benefits of sharing of PoS information

depend on the nature of demand pattern.

Gibson, Brain et al (2009)46 observe that the retailers are more reliant than

ever on supply chain management for organizational success. The focus of SCM is

to cut down inventory levels while maintaining high in-stock availability, reducing

transportation expenses in the context of fuel price volatility. Efforts are well under

way to link SC strategies to organizational plans. The best performing retailers

have developed a culture in which the majority of employees share a core belief in

the mission of the organization, and are committed to helping the organization

achieve that mission. These retailers have developed formal training programs to

suit the needs of rank and file employees, along with the managers.

The importance of supply chain inventory management technique Vendor

Management Inventory (VMI) is reinforced by Waller M (2001). According to him,

44 Avirat Sonpal (2006), “A Valuable System – Different aspects of managing the supply

chain in retail”, Retail Biz, December, pp. 37-38.

45 Joel H. Steckel, Sunil Gupta and Anirvan Banerji (2004), “Supply Chain Decision Making: Will Shorter Cycle Times and Shared Point-of-Sale Information Necessary Help?”, Management Science, Vol.50, No.4, pp. 458-464. 46 Brian J. Gibson, C. Clifford Defee, Wesley S. Randall (2009), “The State of the Retail Supply Chain: Results and Findings”, Retail Industry Leaders Association (RILA).

37

VMI is one of the most widely discussed partnering initiatives for improving multi-

firm supply chain efficiency. The research article showcases the effect of VMI on

improved service and reduced cost in an organisation.47

Using New Jersey as a case study, this paper investigates the challenges

faced by food retail stores. Policy recommendations proposed by industry

representatives for improving the business climate are also presented. Although

the case is New Jersey specific, many of the issues discussed in the paper may be

relevant elsewhere. The findings can be helpful in identifying broad categories of

factors affecting the vitality of the industry and in designing investigative research

into problems facing the food retail industry (Adelaja, A.O, 1999). 48

Store Attributes

Reutterer, Thomas and Teller, Christopher (2009)49 paper identifies store

format attributes that impact the store format choice when consumers conduct fill-in

or major trips to buy groceries. By doing so, the authors take into consideration that

consumers patronise multiple (store based) formats depending on the shopping

situation operationalised by the type of shopping trip. The results reveal a

considerable moderating effect of the shopping situation on the relationship

between perceived store format attributes and store format choice. Consumers’

preference is significantly higher for discount stores and hypermarkets when

conducting major trips. In contrast, supermarkets are preferred for fill-in trips in the

focussed retail market. Merchandise-related attributes of store formats have a

higher impact on the utility formation regarding major-trips, whereas service- and

convenience-related attributes do so with regard to fill-in trips.

47 Walter M et al (2001), “Vendor Managed Inventory in the Retail Supply Chain”, Journal of Business Logistics. 48 Adelaja, A O. et al (1999), “A note on challenges facing food retail stores: The case of New Jersey”, International Journal of Retail & Distribution Management, Volume 27. No. 8. pp. 302-310. 49 Reutterer, Thomas and Teller, Christopher (2009), “Store format choice and shopping trip types”, International Journal of Retail & Distribution Management, Vol. 37 No. 8, 2009, pp. 695-710.

38

Retailing in India

The following three papers give an account of linkages between economic

growth and consumer spending pattern, the retail distribution network and the

changing Indian retail sector.

Srivastava (2009),50 in his research brings forth the retail scene in India. He

has extensively used the reports of Mckinsey, HSBC, Technopak, CII and others to

capture the growth of organised retail and shopping malls in India. Also, he gives

an account of the different organised formats promoted by the Indian business

houses. He finds that the malls are more developed in Northern and Eastern part of

India. Malls are becoming centre for outings for the families and they spend about

1-3 hours in malls. Food, groceries and apparel purchases by customers

contributed to 52 per cent of these organised retail formats in 2006. Srivastava

further elaborated on the time spent by the customers in the malls and how the

food courts, play places, etc in the malls are becoming the attractions for family

outings. According to him, the small retailers in order to compete and to retain their

customers offer better service by means of credit and home services.

Sengupta A, (2008)51 discusses the birth of the first supermarket, Nilgiri’s

established in Bangalore in 1971. The emergence of modern retail business in

India has a history spanning over 30 years. The paper is on food and grocery retail,

biggest in India and the author tries to detail the drivers of revolution and growth

focusing on the role of manufacturers, retailers and consumers.

Chetan Ahya (2006)52 argues that the rising scale of organized retail

distribution network and increasing competition will force players to focus on

restructuring the whole supply chain to improve productivity and to provide a better

deal to the customers.

50 Srivastava, R.K. (2009), “Changing retail scene in India”, International Journal of Retail & Distribution Management, Vol. 36 No. 9, pp. 714-721. 51 Sengupta A (2008), “Emergence of modern Indian retail: an historical perspective”, International Journal of Retail & Distribution Management, Vol. 36 No. 9, pp. 689-700. 52 Chetan Ahya, “The Retail Supply Chain Revolution”, Economic Times, 7th December 2006.

39

He is critical of the organized retail chains ability to offer customers the right

price for staple vegetables during the crisis situation because of disorganized

supply chain. He concludes that unavailability of cheap funds for investment in the

back-end infrastructure for aggregating the fresh produce, grading, packaging and

storing in cold storage are the primary reasons. Similarly, FICCI is also of the

opinion that the long chain of intermediaries and insufficient price-discovery

mechanisms were the reasons for high price mark-ups between farmers and

consumers. FICCI suggest farmers need to be encouraged to form farmer

cooperatives and aggregate the produce, which could be directly sold on electronic

spot exchanges or to retailers.53

Modern retail has a huge potential to not only benefit from India’s increasing

consumption demand but also create demand for value added products. Structured

employment and better life for people are the two major benefits that modern retail

is looked upon. Speeding up the modernization process is extremely vital as the

retail sector has the ability to create about 10 million additional jobs in the next five

years (2010-15). Over one million sq. feet of quality retail and entertainment space

with annual revenue of Rs. 12,00,000 crore, a whopping Rs 1,30,000 crore in

annual Value Added Tax (VAT) collection and over Rs 12,000 crore in additional

income tax revenues to the exchequer are expected to accrue in the next five

years according to Mr Amitabh Taneja, Chief Convenor, India Retail Forum 2010.54

According to Arvind Singhal, Chairman, Technopak, modern retail and food

services in India are at a very early stage of evolution. They have to keep pace with

the changes in demography and consumption patterns. Changes in the format

size, categories, merchandise mix or brand positioning are the need of the hour.

Accordingly, some of the established chains like The Future Group, Spencer’s

Retail etc, are in the revamp mode. They are rebranding their stores, restructuring

categories and formats to catch up with the changing landscape of modern retailing

and to cater to the emerging niches.55

53 Vishal Krishna, “Retail - Disorganised Supply Chain”, Businessworld, 31st January 2011. 54 “Expanding Business Opportunities”, The Economic Times, 14th September 2010. 55 Writankar Mukherjee and Sreeradha D. Basu, “Retailers revamp for more business”, The Economic Times, 15th September 2010.

40

Driven by the growth of organized retail coupled with changing consumer

habits, food retail market size in India is set to double to $150 billion (around Rs

6.7 lakh crore) by 2025. Therefore, Indian food retail sector, which is currently

estimated at $70 billion (around Rs 3.13 lakh crore) has a long way to go in the

years to come. Evolution of innovative food processing capacity, emergence of

organized retail and change in consumption patterns along with fast changing

demographics and habits are expected to fuel the next growth trajectory for the

food industry in India, according to KPMG. Though the expectations are high about

the growth prospects of the sector, it is a paradox that the growth in real terms is

crippled by the sub-optimal supply chain management largely caused by low

investments in the sector.56

In the days to come, almost all sales will be captured through Personal

Digital Assistant (PDA) or computers at the retail outlet and transmitted to the

suppliers as being done by leading companies such as Dell and Wal-Mart. This will

definitely bring down the wastages in supply chain. The logistics cost which is

currently at 12 per cent of GDP could go down by about 1 per cent as a result of

application of IT.

The cycle time of supply chain operations from manufacturing to retailers in

terms of information flow which used to be about 30 to 35 days in the early 1990s

has been brought down to almost one or two days in the 2010s. This was made

possible by using various hardware and software technologies and communication

links at various levels such as the mobile network, satellite communications,

personal digital assistants, automated tracking devices, vehicle tracking systems

and so on.57

56 Press Trust of India, “Food Retail Sector to double to $150 billion by 2025: KPMG”, Business Line, 8th December 2010. 57 Murali D, “Logging into improved Logistics”, In conversations with Mr. V. Sanjeevi, MD, eLogistics P Ltd., Business Line, 14th February 2011.

41

Shopping behaviour

A recent research study reveals some important insight about an Indian

shopper.58 The customer: 1. keeps a brand in mind but buys the brand that gives

him value 2. is more decisive than the Chinese about the brands they want to buy

3. confidence on the shopkeeper is high 4. takes time to read the information and

to make sure that he gets what he wants. Also compares products before deciding

5. usually takes whatever the storekeeper suggests if preferred brands are not

available 6. does not look for promotions because most of the shopping is routine

7. enjoys shopping 8. likes reading the ingredients and product benefits before

buying 9. will buy a slightly pricey brand if it can give him an experience/ feeling like

no other.

Goswami Paromita (2009),59 seeks to understand whether Indian

consumers are likely to move from traditional kirana stores to large organized

retailers while shopping for groceries. Major findings show that customer

patronage to grocery stores is found to be positively related to location, helpful and

trustworthy salespeople, home shopping, cleanliness, promotional offers, quality

and negatively related to travel convenience. kiranas do well on location but poorly

on cleanliness, offers, quality, and helpful trustworthy salespeople. The converse is

true for organized retailers.

Retail Supply Chain in India

According to Rajesh Sinha,60 Chief Operating Officer (COO), Godrej

Consumer Products, focus on supply chain improvement based on a

replenishment-based model rather than a forecast-based mode enables

companies to increase sales by 20 to 30 per cent in three to six months. In two

years, a company can register a 5 per cent increase in gross margin. The

58 Economic Times (ET) Brand Equity, “What Lies Beneath?”, The Economic Times, August 08, 2010. 59 Goswami, Paromita and Mishra S. Mridula (2009), “Would Indian consumers move from kirana stores to organized retailers when shopping for groceries?”, Asia Pacific Journal of Marketing and Logistics, Vol. 21, No. 1, pp. 127-143. 60 Business Line Bureau, “Supply Chain must ‘get’ as much ‘focus’ as marketing”, Business Line, April 22, 2011.

42

effectiveness of advertising or promotions increases with increase in supply chain

efficiency. Strategic sourcing can reduce expenses by 10 to 30 per cent.

Collaborative models with multiple suppliers are the order of the day.

Vishwanadham N (2010)61 analyses the deficiencies in the Indian supply

chain in the food retail. The most important problem associated with the Indian food

industry is the inefficient supply chain as a result of which about 20 per cent of the

food produce worth Rs. 10,000 crore is wasted. Only through developing an

efficient supply chain can India’s population have access to affordable superior-

quality food produce while ensuring remunerative prices to the farmers.

The food supply chain is complex, with perishable goods and numerous

small stakeholders. In India, the infrastructure facilities connecting these

components are very weak. Each stakeholder – farmers, wholesalers, food

manufacturers and retailers work in silos. Demand forecasting, data integration,

financial flow management, supply-demand matching, collaborative forecasting,

information sharing and synchronisation of the movement of goods through

efficient transport scheduling have to find their way into the food supply chain.

Manufacturers, wholesalers, distributors and retailers can achieve tangible

benefits through innovative network and inventory optimisation. The benefits may

include enhanced demand intelligence, improved sales and services, optimised

inventory levels, increasing profitability and margins and enhanced trading partner

collaboration. Inventory management helps reduce purchasing and inventory costs;

connect inventory control, purchasing and sales order processing with demand

planning; reduce costs, improve cash flow and ensure that the right stock is

available whenever needed.62

Cut-throat competition in India’s organised retail industry has given way to

harmony. The retailers have formed a rainbow coalition that will align their source

operations and share private labels, logistics, warehouses and hiring details on a

61 Vishwanadham N (2010), “From farm to fork”, Retail Biz, July 2010. 62 Debjani Baidyaray, “Selling it right – Effective supply chain management hold the key to successful operations for retailers”, Retail Biz, October 2010.

43

transactional payment basis. The retailers may fight on the front-end but

collaborate on the back-end – an approach that would help retailers focus their

resources on the front-end to meet the customer expectations. The move

essentially focuses on how to cut costs in supply chain and third party

manufacturing. Right now, the supply chain cost is about 12-50% across product

categories.63

India is the world’s second largest producer of fruits and vegetables. But it

loses between 30% and 40% of its fresh produce annually due to wastage along

the supply chain. India wastes more fruits and vegetables than it consumes. Gaps

such as poor infrastructure, insufficient cold-storage capacity, unavailability of cold-

storage in close proximity to farms and poor transportation infrastructure are the

contributing factors. To overcome the debilitating impact of wastage, it is crucial

that three supply chain issues are addressed. They are reduction of food miles,

development of truly world-class supplier and fixing the infrastructure.64

Sahay B.S. (2006)65 studied the current state of supply chain management

practices followed by Indian organisations in an attempt to identify the important

areas that need to be addressed in order to gain competitive advantage. The

findings reveal that most of the Indian organisations have aligned their supply

chain objectives with their business objectives. They are now on aligning their

processes and management focus. The author concludes that the enhanced level

of competitiveness would require Indian organisations to manage the three-

dimensional (supply chain objectives, supply chain processes and management

focus on supply chain activities) alignment.

For organised retail, while the last decade has been one of experimentation,

the coming decade would be that of consolidation. The retailers have been

63 Kala Vijaraghavan & MV Ramsurya, “Retail Cos cuts costs by uniting back-end work”, The Economic Times, 10th August 2009. 64 Raj Jain, “A wake-up call to maximise supply chain efficiencies”, The Economic Times, 12th October 2009. 65 Sahay, B.S. Gupta, Jatinder N.D. and Ramneesh Mohan (2006), “Managing supply chains for competitiveness: the Indian scenario”, Supply Chain Management: An International Journal, Vol. 11, No. 11, pp. 15–24.

44

dabbling with a variety of formats, supply chain configurations, product portfolio,

project financing, manpower planning and so on. Towards the end of the decade,

confidence level amongst the organised retailers on how to really tap the Indian

opportunity has increased. However, the key issues to be addressed remain are

battle hardened retailers, growing dominance of private labels, supply chain

innovations, enabling infrastructure and policy liberalisation.66

Increasing uncertainty of supply networks, globalization of businesses,

proliferation of product variety and shortening of product life cycles have forced

Indian organizations to look beyond the four walls for collaboration with supply

chain partners. Considering this scenario, a research study was conducted by

Sahay B.S. (2003)67 to study the supply chain practices followed by the Indian

industry. Sahay focused on the four major supply chain dimensions namely supply

chain strategy, supply chain integration, inventory management and IT. The paper

recommends that Indian industry need to align supply chain strategy with business

strategy, streamline processes for supply chain integration, form partnerships for

minimizing inventory and focus on infrastructure and technology deployment to

build an India-specific supply chain.

The following tables present in brief the studies conducted by different

agencies, consulting firms, institutions and centres of excellence on Indian retailing

and retail supply chain.

A C Nielsen on Retail and Retail Supply Chain

Title Issue Focus Area/Key Result Global Online Consumer Confidence, Concerns and Spending Intentions

A Nielsen Report, July 2011

The report is based on the survey conducted between May 20 and June 7, 2011 covering more than 31,000 consumers in 56 countries throughout Asia Pacific, Europe, Latin America, the Middle East, Africa and North America. The report shows that the Indian consumers (with an index of 126) remained most positive and have consistently reported the highest consumer confidence scores since Nielsen consumer confidence tracking began in 2005.

66 Karthik Ramamurthy and Pratik Puprediwar, “The New Level”, the strategist, Business Standard, 14th February 2011. 67 Sahay B.S. and Ramneesh Mohan (2003), “Supply chain management practices in Indian industry”, Distribution & Logistics Management, Vol. 33 No. 7, pp. 582-606

45

Title Issue Focus Area/Key Result However, the few unpleasant factors associated with higher prices spurred by inflation, and general economic volatility across the globe in terms of recessionary trends are dampening the Indian consumers spirit as well with respect to spending and could be gauged by the slight dip in the purchases of some of the consumer goods.

A.T. Kearney on Retail and Retail Supply Chain

Title Issue Focus Area/Key Result The Case for "Compact Hypermarkets" in India

Debasish Mukherjee & Hemant Kalbag, A.T. Kearney, 2011.

The analysis suggests that organized retailers use smaller formats called ‘compact hypermarkets’ which can tap India's significant urban retail opportunities. Compact hypermarkets are 4,000- to 6,000-square-foot stores; offer the amenities of hypermarkets but are smaller and easier to navigate, and they can compete head-to-head with the kiranas.

Indian Retailers: Improving category management

Hemant Kalbag, Debasish Mukherjee & Subhendu Roy, A.T. Kearney, 2010

The authors propose four guiding principles to capture top and bottom line improvements while keeping the customers happy. They are i. Take a Customer Focus ii. Define category role iii. Watch the competitors and suppliers and iv. Strengthen operations and performance.

Measure Twice, Cut Once – Planning, attention to details, and tested programs build excellence in retail operations

A.T. Kearney, 2010

This study provides a blueprint for achieving an operational excellence. This study gives a four stage framework consisting of i. Driving store value through voice of the customer, channel strategy and store business planning ii. Delivering core store value through supply chain interfaces and store operations iii. Enhancing store value through store life-cycle management, operating expense control and store technology and finally iv. Using the learning store for roll out.

Unleashing the shopper marketing engines

Laura Gurski, Melanie Schmidt et al, 2009

The article gives a detailed picture about shopper marketing, vision, focus, approach and philosophy. It details about the three gears namely sales-marketing connectivity, insights-driven decision making, and in-store brand activation. It aims to differentiate and activate the consumer products in an increasingly competitive retail environment.

46

Title Issue Focus Area/Key Result Retail in India: Getting organized to drive growth

Confederation of Indian Industry (CII) – A.T. Kearney Report, November 2006

The report is divided into three parts namely: i. Retail landscape in India, ii. Key issues in the way of retail growth in India, iii. Key imperatives. The first part deals with the status of organised retail in India, its growth, category wise market share in organised retail and different retail formats. The key issues related to the growth include underdeveloped supply chain, inadequate utilities, IT infrastructure hurdles, inadequate real estate hurdles, inadequate human resource, taxation hurdles, supply base hurdles, limited consumer insights, insufficient government incentives etc. forms the second part.

The third part covers the measures to be taken to overcome the hurdles listed in the second part. The concluding part details the impact of recommended changes on the retail sector.

Ernst & Young on Retail and Retail Supply Chain

Title Issue Focus Area/Key Result

Turn risks and opportunities into results – Exploring the top 10 risks and opportunities for global organizations: Retail sector

Olivier Macard and Daniel Valerio, July 07, 2011

This report is based on the interviews with a panel of retail sector professionals. The top 10 risks are Low-growth consumer markets, Regulation and compliance, Inability to control costs/rising input prices, Inability to benefit from e-commerce, Wrong price image, Supply chain disruptions, Inability to penetrate emerging markets, Failure to respond to shifting consumer behaviour, Sourcing and Volatility in commercial real estate markets. The top 10 opportunities are Rising emerging market demand and rise of global middle class, New marketing channels and social media, Competitive differentiation via CSR and green branding, Multichannel approach, Demographic change, Private label, Launching new products and services, Global urbanization, Competitive differentiation via local branding and Enhancing efficiency in the SC.

Flavours of Incredible India – Opportunities in the Food Industry

FICCI – Ernst & Young Report, October 24, 2009

According to the report, the Indian food industry is poised to grow by a whopping 42.5% from US$ 181 billion (Rs 8,43,460 crore) in 2009 to US$ 258 billion (Rs 12,02,280 crore) by 2015 and by 76% to US$ 318 billion ( Rs 14,81,880 crore) by 2020, throwing up huge opportunities for investment across the entire value chain.

47

Title Issue Focus Area/Key Result Growth in size of the middle to very rich class is projected to increase at more than 300% between 2005 and 2015. During the same period the proportion of young population (age group 15- 25) in India is expected to grow by 11%. This will lead to an increasing demand for food products to meet demands of convenience, variety, health and a changing palate.

Winning with Intelligent Supply Chains

PinakiranjanMishra, Ernst & Young, December 17, 2007

This survey was conducted jointly by FICCI and E&Y. It highlights the key drivers of retail, drivers of change in supply chain, the paradigm shift from the traditional supply chain towards adoptive and real-time supply network with bi-directional information flow, retail supply chain challenges and mitigation strategies.

FICCI on Retail and Retail Supply Chain

Title Issue Focus Area/Key Result Challenges faced by Retail Industry in India

Ketan Dewan, Footfalls, June – July, 2010, Volume 4, Issue 7

The article focuses on the following issues i. competition from local kirana stores ii. knowing and understanding the target customers iii. supply chain management (SCM) issues such as inventory level at stores and distribution centre, demand forecasting, logistics infrastructure, cold storage chains and quality transportation and procurement of goods, iv. lack of trained and skilled manpower and v. shrinkage. Also, the article discusses strategies to overcome these issues and challenges.

RFID Technology in Retail Supply Chain

Ravi Mathur and Gopal Valecha, Footfalls, February-March 2010, Volume 2, Issue 6

This article focuses on the tracking technology RFID and its different standards. It also gives a detailed description about benefits of RFID in achieving supply chain efficiency such as increasing visibility, lowering operating costs, real-time information processing, reducing stock-outs and increasing the competitiveness.

Can modern retail learn from the humble kirana?

Raghav Gupta, Footfalls, March – April 2009.

This article identifies interesting things that kiranas do that could be adapted by modern retail for increased business success, namely: i. Customer Relationship Management ii. Dynamic Merchandising and iii. Efficient store operations.

Organised Retail: Unfinished

FICCI Retail Report , 2007.

This report is based on information collated from key industry players, trade associations, government agencies, trade publications and various industry

48

Title Issue Focus Area/Key Result Agenda and Challenges Ahead

sources. It gives a detailed view of retail global scenario vis-a-vis Indian retail market. It discusses changing real estate scenario, requirement of finances in retail, varied unfinished agenda in retail such as simplifying tax structure, single window clearance, FDI in retailing etc. The report covers in detail the retail supply chain management issues in India.

KPMG on Retail and Retail Supply Chain

Title Issue Focus Area Sectoral Snippets – India Industry Information

KPMG Report, April 2009.

This report highlights the current and future scenario of the retail market in India. It also presents a picture of Indian companies’ strategic actions to cope with the current economic stress. In the days to come, the Indian retail is going to focus on value retail and food retailing, the study reports. Also, there will be more concentration in Tier II and Tier III cities. According to the study, the companies will invest more in supply chain efficiencies and emphasizes the fact that there is a long term outlook for retail in India and this sector continues to be attractive and there are huge prospects for expansion.

Indian Retail: Time to change lanes

KPMG Report, March 2009

This report brings forth the impact of slowdown in different parameters of Indian retail sector. Also, it proposes a bouquet of strategies for the retailers to cope up with recession. According to the report, the recession has affected the footfalls, operating margin, put pressure on the liquidity and the rentals increased etc. It also suggests the ways to build a competent retail supply chain management system.

Skill gaps in the Indian Logistics Sector: A white paper

KPMG Report, 2007

This report is the outcome of the CII Logistics Summit – 2007. It details the status of the logistics sector in India, identifies and assessed the skill gaps in this sector, a deeper look at the critical areas, finds the root causes of the skill gaps and recommends suitable solutions to fill up the gaps.

Indian retail: on the fast track. Bridging the capability gaps.

KPMG Report, 2006

According to the report, there are many drivers contributing to the unprecedented consumption boom. The report enlists the fastest growing retail segments in India, organised retail as percentage of FMCG sales by city, experimentation by ITC on rural retailing, evolution of retail formats, growth of malls etc. It thoroughly figures different parameters related to supply chain

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Title Issue Focus Area such as supplier integration, supplier maturity, sourcing, fragmentation of supply chain, technology adoption and usage, private labels etc.

KSA – TECHNOPAK on Retail and Retail Supply Chain

Title Issue Focus Area

Changing India, Changing Consumption , Changing Consumers

Arvind Singhal, Perspective, Volume 3, 2010

The first part of the report lists down the factors contributing to a dynamic economy. The study forecasts the consumption pattern for the year 2014. The food and grocery spending continues to be a major component and it continues to top the categories of consumption. The consumers will shift from ‘low-price’ platform to ‘price-plus’ platform. There will be a strong increase in the trend of going shopping as a ‘family’, the study opines.

Increasing Private Label Share in Indian Retail

Baqar Iftikar Naqvi and Madhulika Tiwari, Perspective, Volume 3, 2010

The economic slowdown has significantly increased the pace of shift from national brands to private labels or store brands among the organized retailers. It has increased the private label sales. This migration is not only linked to price (5-10% less than national brands), but also to various factors like improvement in product quality, packaging, presentation and retail experience. The study reports that the rise of private labels is resulting in many conflicts between retailers and brands owing to issues like margins, display and shelf space.

India’s Food Vision: The Next Decade

Sridhar V. & Nimisha Chhabra, Perspective, Volume 4, 2010.

This paper details the growth prospects of India, followed by key factors that have enormous importance in increasing demand for food and are expected to play a major role in the transformation of demand drivers in the growth of food demand – rising population and incomes, increasing number of nuclear families and working women and palate & lifestyle changes. It also gives an account of key issues and challenges in food industry.

India’s Emerging Hot-Spots

Veenu Sharma, Perspective, Volume 4, 2010.

This article throws light on the smaller cities becoming nodes of attraction for the marketers. The infrastructure developments, the changing customers, the ripple effect of the metros on the cities are contributing to the growth of these cities. These hot-spots are going to bring to the forefront the next wave of new cities that the retailers would

50

Title Issue Focus Area

be interested in looking at in order to gain ‘first mover’ advantage and a foothold in the market.

Overview of India’s Consumer and Retail Sectors

Raghav Gupta, Rohit Bhatiani and Pranay Gupta, Perspective, Volume 4, 2010.

The first part of the research article delves into the impact of slowdown on consumer confidence, private consumption and organised retail. The later part of the article finds that the EBITDA and ROC for the retail sector is about 10-12 per cent, while for the FMCG sector, the numbers are higher. The low level of returns in retail is primarily due to the high level of inefficiencies at the back end. Inventory management which is an integral part of any successful retail operation is currently lacking. A significant amount of capital of an Indian retailer is blocked in inventory leading to a strain on the balance sheet.

The Indian Retail Landscape: Now and Beyond

Anil Rajpal and Pragya Singh, Perspective, Volume 1, 2009.

This article looks at how modern retail’s landscape is changing and what can be expected in the near term. It analyses how some retailers are entering the rebuilding phase with a focus on resizing, relocating and restructuring stores. It also looks at the impact of consumer product companies investing in traditional retail, outlines the emergence of collaborative models in retail real estate, and defines the required focus on retail back-end, i.e. supply chain.

Supply Chain Challenges in the Indian Retail Sector

KSA – Technopak, A quarterly report, January 2008.

The report presents an overview of Retail Supply Chain Management (SCM) in India. It discusses the current market size and future estimation; the factors affecting organised retail SCM in India, compares and benchmarks with international retail supply chains. The second part of the study focuses on supply chain objectives, symptoms and pain areas, strategic SCM areas and improvement projects for Indian retailers

Changing Retail Landscape in India: Emerging Conflicts and Implications

KSA – Technopak,2nd November 2007

The presentation is divided into four sections namely the i. Economic update on India ii. Impact Areas iii. Emerging Conflicts and iv. Implications for Stakeholders. It gives an insight into the factors influencing the growth of retail in India.

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McKinsey on Retail and Retail Supply Chain

Title Issue Focus Area/Key Result Building India – Transforming the nation’s Logistics Infrastructure

A McKinsey Report, 2007.

This is a comprehensive report that covers the India’s current logistics infrastructure. The report finds it inadequate to meet the growth aspirations and presents a logistics infrastructure strategy. The strategy suggested revolves around the proposal to bring out a National Integrated Logistics Policy (NILP).

Tracking the growth of India’s middle class

Eric D. Beinhocker, Dianna Farrel, and Adil S. Zainulbhai, McKinsey Quarterly No. 3, 2007

The study reports the linkage between India’s rapid economic growth and its influence on consumers. The author predicts that in the next two decades, India will become world’s fifth largest consumer economy. Consumer spending will quadruple from about Rs 17 trillion ($372 billion) in 2005 to Rs. 70 trillion in 2025. The country’s middle class is estimated to grow from about 5 percent of the population to more than 40 percent, i.e. from 318 million in 2007 to 5,283 million in 2025. India will become the world’s fifth largest consumer market by 2025 from the 12th position now. India will witness the rapid growth of its middle class – households with disposable income from Rs. 2,00,000 to 10,00,000 a year. Food will remain the single largest category of expenditure and growth in consumption will accelerate from 3 per cent annually now to 4.5 per cent.

Other Report

Title Issue Focus Area India in Figures – A ready reference, 2011

Report of the Ministry of Statistics and Programme Implementation, Government of India

The report gives authentic information about population characteristics, economic characteristics, infrastructure, industry, energy, agriculture, social characteristics and also that of BRICS countries.

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THE RESEARCH PROBLEM

The supply chain has a key role to play in the expansion and profitability of

retailers. Retailing and logistics are concerned with product availability.68 The

retailers must be familiar and adept with the flows of product and information both

within the business and in the wider supply chain. In order to make products

available, retailers have to manage their supply chain in terms of product

movement and demand management. They need to know what is selling in the

stores, anticipate and react quickly to changes in the demand.

The fact that logistics and supply chain management play a decisive role in

modern retailing needs no emphasis. Advanced tools and techniques in the retail

supply chain have led to the improvements in the management of inventory,

distribution networks and vehicle scheduling. Retailers need the timely delivery of

merchandise if they are to satisfy and retain the customers. To quote Newman, If

it’s not in store, you can’t show it! If you can’t show it, you can’t sell it! (Andrew J

Newman, 2007).69 The most significant challenge that impedes the development of

an efficient and modern retail sector is an underdeveloped supply chain.

NEED FOR THE STUDY

The underdeveloped, traditional, and unidirectional supply chain increases

inventory build-up coupled with operational inefficiencies for companies (Business

Line: April 24, 2008).70The spurt in the organised retail business in terms of the

number of retail chains across the country testifies the growing acceptance of the

modern retail format and the shift in the customer preferences from the traditional

kirana stores to huge retail outlets which have made shopping a pleasant

experience. The earlier reluctance to visit the small typical grocery store is replaced

by new enthusiasm and excitement on the part of the 21st century consumers. The

new realities and changing dynamics of the retail trade prompted the researcher to

68 John Fernie & Leigh Sparks, Logistics and Retail Management, Kogan Page, London and Sterling VA, 2004. 69 Andrew J Newman and Peter Cullen, Retailing: Environment & Operations, Thomson Learning, 2007. 70 D. Murali and Kumar Shankar Roy, Biggest Challenge for retail is ‘underdeveloped supply chain’, Business Line, April 24, 2008.

53

examine in detail how issues related to supply chain – the critical success factor in

the F&G retail format – are addressed. Hence the research topic “Retail Supply

Chain Management in Food and Grocery (A case study of Bangalore City)”.

OBJECTIVES OF THE STUDY

– To examine the management of logistics and cross-functional drivers of the

Food and Grocery (F&G) retail outlets;

– To study the management of supply chain processes like the Customer

Relationship Management (CRM), Internal Supply Chain Management

(ISCM) and Supplier Relationship Management (SRM);

– To assess the degree of competition among the food and grocery (F&G)

retail outlets;

– To determine the performance of the Food and Grocery (F&G) retail outlets

using different metrics, and

– To suggest ways and means to improve the supply chain management

practices of Food & Grocery (F&G) outlets.

TESTING OF HYPOTHESIS

H 1: The time and the amount of purchase made by different customer groups

(family, friends and individuals) are different.

H 2: Mean of the percentage of sales over different periods of a month

(namely 1st -10th, 11th – 20th and 21st – 30th) are same.

H 3: The number of footfalls at an organised retail outlet is independent of the

location of the outlets

H 4: The number of footfalls at an organised retail outlet is independent of the

size of the outlets

H 5: Number of customers for an outlet depends on catchment area.

H 6: Number of customers is independent of the size of the organised retail

outlets.

H 7: Competition has affected the sales of organised retail outlets.

H 8: Distribution of the sales per square foot of organised retail outlets and the

kirana stores are different.

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H 9: Distribution of monthly sales of organised retail outlets and the kirana

stores are different.

H 10: Distribution of sales per employee of organised retail outlets and the

kirana stores are different.

SCOPE OF THE STUDY

Retailing in India is gaining momentum over the years. The city such as

Bangalore has great potential for organized food retail. The research study

examines the logistics and cross-functional drivers of supply chain in detail as

practised by the organised retail outlets in Bangalore. Towards that the study

identifies the areas where the outlets are doing better and also enlists the areas

where they have to improve upon. This gives the scope for the operators/owners of

the outlets for enhancing the customer service, product availability, etc.

It also helps the managements of the retail outlets devise appropriate supply

chain strategies to achieve competitive strategic objectives. For planners, the study

gives the insights which will enable them to frame policies, procedures and

schemes to create a congenial environment and impetus for further growth of food

retail in Bangalore.

LIMITATIONS OF THE STUDY

In spite of the efforts undertaken by the scholar, given the vastness and spread

of the city of Bangalore and at times coupled with the reluctance of the

respondents to divulge information wholeheartedly, the researcher has confronted

with certain limitations in the field work. Therefore, like any other project of this

magnitude, the present research study is also not free from some limitations.

– The focal point of the study is to examine the six supply chain drivers of the

food and grocery outlets/stores in Bangalore City. Therefore, inferences

drawn from the study will have limitation of generalisation of findings.

– The data analysis, interpretation and inferences are based on the data

collected from the managers, operators and employees of the

outlets/stores. Their perceptions may have personal bias and subjective

view points.

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– Food and Grocery outlets operate in a dynamic environment. The

observations and inferences drawn out of the study pertain to the particular

period of time. This would have changed or may change over a period of

time.

RESEARCH METHODOLOGY

The Food and Grocery (F&G) retail segment in India is unique. F&G can be

broadly categorised into organised and unorganised retail. The organised retail can

be further categorised into corporate retail chains and individual standalone retail

outlets. For the purpose of the study, the researcher has considered all the three

segments namely, corporate retail chains, standalone retail outlets and kirana

stores.

Also, an attempt is made to ascertain the practices adopted by unorganised

sector (kirana stores) in comparison with organised sector with respect to the

adoption of modern practices.

Table 2.1: Sources of Information

Universe Retail outlets (kirana stores, corporate retail chains and standalone retail outlets) in Bangalore.

Sampling unit Retail outlets Sampling Technique Judgemental Sampling Primary Sources a) Structured Questionnaire – Different sets of

questionnaires were administered on organised outlets and unorganised kirana stores.

b) Personnel Interviews with corporate office personnel, store managers, operators, supervisors of organised outlets and kirana store owners.

Secondary Sources Journals, Periodicals, Business Magazines, Newspapers, Corporate Retail Chains’ Websites, Retail Organisations’/Associations’ Websites, pamphlets and catalogues.

Given the structure of the Indian retail sector (F&G) which is still in the

‘growth’ stage, it was felt appropriate to select the sample units from both

organised and unorganised sectors as shown in the Figure 2.1.

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Figure 2.1: Selection of Samples

DETERMINATION OF SAMPLE SIZE

Kirana Stores

An appropriate sample size has been arrived at after taking into account the

confidence level of 95%, confidence interval of 7% and the population (number of

kirana stores). The sample size determined is given in table 2.2. Thus, the sample

size of kirana stores considered for the study was 200.

Table 2.2: Determination of Sample Size (kirana stores)

Confidence Level 95%

Confidence Interval 7%

Population (No. of stores – Estimate) 2,00,000

Sample size Required 196

Source: http://www.surveysystem.com/sscalc.htm.

Organised Retail Outlets

As the number of organised outlets was limited, a minimum of 25 per cent of

the total number of outlets of retail chains was considered for the study. The break-

up of the number of organised outlets surveyed is given in table 2.3 and it was

150.

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Table 2.3: Retail Chains and Number of Outlets Surveyed

Name of the Retail Chain

Total Number of outlets in Bangalore

Number of outlets surveyed

Percentage of outlets surveyed

@Fresh 16 12 75

Spencer's 19 14 74

More For You 76 38 50

Nilgiris 56 14 25

Food World 48 12 25

Reliance Fresh 36 9 25

Safal Daily Fresh 32 8 25

Smart Supermarket

28 7 25

Standalone Outlets

36

Total 150

Thus, the total sample size was 350 and is shown in table 2.4.

Table 2.4: Total Sample Size Surveyed*

Type Number

kirana Stores 200

Food and grocery retail outlets 150

Total 350

*Note: Only one outlet/store from a location (E.g. Shopping Complex) is selected for the survey. Pilot Survey

A pilot survey was conducted at Banshankari II and III stage, Bangalore to

ascertain the validity of the questionnaire. About 15 kirana stores and 10 organised

retail outlets were covered as part of the pilot survey. The objective of the survey

was to understand from the respondents the relevance, usability, reliability etc of

the instrument. Based on the insights gained in the pilot survey, some of the

questions were rephrased, some were redesigned, re-categorised and refined.

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Research Survey

The survey is exploratory in nature. As part of the survey, the researcher

has covered almost all major locations in the city of Bangalore. Though the

sampling method adopted was convenience/judgemental sampling, only one outlet

from a location is selected. This is to make sure that as many outlets as possible

may be covered from different locations and information collected is not biased or

skewed. In case of organised outlets, it was ensured that the outlet selected was in

operation for at least one year. The number of outlets of retail chains and

independent outlets where the survey was conducted are given in Table 2.5.

Table 2.5: Location of Organised Outlets

1. Adugodi 2. Frazer Town 3. Narayana Pura Main

4. Airport Road 5. Gandhi Nagar 6. Padmanabha Nagr

7. Annapoorneshwari Nagar 8. HAL I Stage 9. Pai Layout

10. Ayanagar 11. Indira Nagar 12. Prasanth Nagar

13. Banaswadi 14. J P Nagar 15. Puttenhalli

16. Bangalore 17. Jalahalli West 18. Raja Rajeshwari Nagar

19. Bannerghatta Road 20. Jayanagar 21. Rajaji Nagar

22. Bapuji Nagar 23. Kamakshi Palya 24. Rajaji Nagar 2nd Stage

25. Basavangudi 26. Kamaraj Street 27. Ramamurthy Nagar

28. Basveswara Nagar 29. Kasba Hobil 30. RPC Layout

31. Begur Hobli 32. Kasturnagar 33. RT Nagar

34. Bhanashankari 35. Kengeri 36. Rustum Garden

37. Bhanashankari 2nd stage 38. KHB Colony 39. Sahakara Nagar

40. Bhanashankari 3rd Stage 41. Kodihalli 42. Sarajapur Road

43. Brookefield 44. KonanaKuate 45. Shivaji Nagar

46. BTM Layout 47. Koramangala 48. Sultan Palya

49. C V Raman Nagar 50. Kothanur Road 51. Teacher's Colony

52. Canara Bank Layout 53. Magadi Main Rd 54. Tippasendra

55. Chamrajpet 56. Mahalakshmi Layout 57. Uttarahalli

58. Chandra Layout 59. Malleswaram 60. Vidyarayanapuram

61. Chord Road Extension 62. Martahalli 63. Vijaya Nagar

64. Doddabanaswadi 65. Nagarbhavi 66. Vijayanagar

67. Dommalur Layout 68. Nagarbhavi Main

Road 69. West Of Chord Road

70. Ejipura 71. Nandini Layout 72. White Field

73. Electronic City 74. Yelahanka Source: Field Survey.

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In case of kirana stores, sample units were chosen in such a way that they

represent different location in the city of Bangalore.

The number of outlets surveyed and their year of establishment are given in

the Table 2.6 and Figure 2.2. The concept of organised retail is very new in India.

In the country, the growth of organised retail gained momentum in 2003-04. The

sample of the outlets collected also replicates the same. That is, the number of

outlets opened over the years has increased and may continue to grow further in

the years to come. The survey was conducted during the year 2009.

Table 2.6: Year of Establishment of Organised Outlets

Year No. of Outlets Percentage

2000 1 1

2001 1 1

2002 3 2

2003 4 3

2004 6 4

2005 12 8 2006 19 13

2007 46 31

2008 58 39

Total 150 100

Source: Field Survey.

Figure 2.2: Year of Establishment of Organised Retail Outlets

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Reliability Analysis

Reliability of the questionnaire was tested using Chronbach’s Alpha (also

referred to as coefficient alpha) technique. The test showed a satisfactory index of

0.6 to 0.9 which is adequate for the analysis of the data.

Data Tabulation and Analysis:

1. Microsoft Access 2007 was used for database creation and data entry

purposes.

2. Microsoft Access 2007 and Microsoft Excel 2007 were used for data

filtering, sorting and drawing charts.

3. SPSS Ver 16.0 was used for descriptive analysis, testing of hypothesis (both

parametric and non-parametric) and multivariate analysis.

CHAPTER SCHEME

Chapter 1 Introduction

Chapter 2 Literature Review, Research Design and Methodology

Chapter 3 Data Analysis

Chapter 4 Testing of Hypothesis and Model Building

Chapter 5 Summary of Findings and Conclusion

Bibliography

Annexures

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