managalam Supermarket - Humari Dukaaan -- 12107A0007 - Vrushal Sangvekar

Subject: Retail Management

Project: Managalam Super Market – Humari Dukaan

Prepared by Vrushal Sangvekar

Roll no: 12107A0007

MMS Marketing

3^rd SEM

Introduction

Retail industry in India overview : 

In country where nearly two thirds of the growth is on account of consumer spending to buy more, it is obvious to expect the retail market to grow manifold. The overall retail market in India has grown at CAGR of 12% in the last 4 years to reach approximately rs.25 trillion in FY 12.

This opportunity has lured several organized players to enter the Indian retail market, resulting in the overall organized retail penetration rising from 3 percent in 2005 to 8 percent in 2012. This further expected to increase to 13 percent by 2015.

The food and grocery market is seeing a very gradual shift from traditional kirana stores to supermarkets and hypermarkets [less than 1 percent in 2006 to more than 2 percent of overall sales today]. 

Of this hypermarkets alone account for 25-30 percent of retail sales by value.  For a leading pan – India retailer, footfalls across his hypermarket formats have increased from 12500 a day [three to four years ago] to over 30,000 a day currently.

Humari Dukaan – Mangalam SuperMarket.

Mangalam Supermarket located strategically near the residential buildings. It is located near sanghvi estate, catering to minimum 500 to 600 residents staying nearby.

It is 400 sq. feet in size, and has approximately 700-800 stock keeping units.

Retail store layout:

The store layout is like a chemist shop. The red arrow shows the entrance or front of the shop.

The yellow color rectangle is the glass desk, where all the impulse buying products are kept. These are small items like talcum powder, razors, chocolates etc.

When asked about specific reason for this particular outlet, the retail owner explained that, initially the retail outlet was not the chemist type outlet. Initially when one is starting the new outlet, it should be race track outlet, where the customer can come inside the shop. And once the shop is established, the retail outlet can be changed to chemist type.

The initial investment for the shop is 7-8 lakhs. The shop is 8 years old. The ghumasta license renewal is done of rs.500 every year.

“Gomastha (also spelled Gumastha or Gomasta, Persian: agent) described an Indian agent of the British East India Company employed in the Company's colonies, to sign bonds, usually compellingly, by local weavers and artisans to deliver goods to the Company. The prices of the goods were fixed by the gomasthas. The goods were exported by the Company to Europe and America. A gomastha may also be described as ‘a paid manager of the private trader’s concerns’, who claimed ‘hardly any share in the profit and loss of his employer’s business”

SKU management:

Retailer places weekly order to the sales representatives of respective companies.The display of the product is as per the margin given by the company to them. Retailers push those products first to the customers which yield higher margin to them.

All transactions are done on credit basis. If the products are ordered from the company, the payment is done to them after 15 days. If a new product is launched by the company, the retailers initially order in small quantities to test the customer response.

Retailers understand through their own instinct, acquired through experience, that whether new product is being liked by the customer. And accordingly they renew the order.

Also when asked, how the retailer understands, which stock is depleting and overstocked in the inventory, the retailer told that it is by experience they come to know, and no special book is maintained for it. The only book maintained is of the credit given to customers.Business is mostly done on the credit basis.

He told that Britania gives 6% margin to the retailers, and products like Amul, they are very dominating, because of the high demand from the customers. So the retailers have to agree on whatever margin they decide. So in this case, the bargaining power of the retailer is less.

Retailer said that when a new shop is opened with small capital, initially start with dairy products, as these are daily requirements of any household. And when enough capital is acquired, slowly introduce, rice wheat, and other products.

Rice, wheat, Onions and potatoes are supplied by the agent from kalian, who visits APMC market. The agent’s office is at Bail Bazaar near kalyan station.

----------------------------------------------Thank You---------------------------------------------