INTRODUCTIONThe Organised Retail industry has been the talk of the business world with some of the big players like Reliance Digital, Chroma & Big Bazaar. These stores are looking to maximise market share by attracting consumers on the basis of competitive pricing schemes as well as variety. Presently, single brand showrooms and outlets dominate the lower middle class segment of prospective buyers, these buyers reside mostly in sub-urban areas as well as small cities & towns where there is less infrastructure as compared to metropolitan cities. They provide sales in smaller quantities along with highly personalised relationship. Nonetheless, only 3% of Indian market is organised retail (Business Today, 2012) which leaves a gigantic gap for organized retailers dealing in electronic goods to fill. A recent Price Waterhouse Coopers study suggests that the size of organised retail in India is only $666million which is likely to grow 30% perannum. However, potential of organised-retail soars high as it is a $300billion industry which has set the stage for organised retailers to gain substantial market-share. 1 (Economic-Times 2012) There has been considerable growth amongst middle-class sector in India, increasing the spending power of consumers. (Indian-economic-survey 2012) "With growth in disposable incomes and improving infrastructure, consumers have a wide choice of stores where they can choose to shop. It is therefore, necessary for retailers to understand shoppers' motivations." (Sinha & Bannerjee, 2004) Moreover, significant changes in lifestyle with new tastes and preferences have developed amongst consumers (Economic-Times, 2012). As people gain purchasing power the market is shifting from price-linked to value-linked where more value is given to design, atmospherics and differentiation suggests (Chand, 2008-Economic Times). Retail Stores are offering a new shopping-experience to all demographics by providing services that offer convenience and 2 comfort along with great-value. In the cultural-context there has been transformation and adaptation towards western ways of life which has specifically influenced young and the middle-age groups. Traditionally, joint-family culture persisted at Indian homes however statistics determine a drastic shift towards nuclear families. Even looking at the Metros like Delhi, the census states the average size of family in Delhi is 5 (http://delhiplanning.nic.in) which has reduced from 10-15 members in one house-hold. Standard of living is increasing because people aspire to live a better life hence, usually both members of family work for higher earnings. This has increased the pace of life and time is of great value. Transformation to this lifestyle demands services that keep-up with the pace and offer convenience & comfort. As a result, the whole idea of all commodities available under the same roof is likely to fit-in the newly formed culture. 3 What is organized retail? Organized retail is nothing but a retail place all the items are segregated and brought under one roof, unlike the unorganized retail where there are different things are sold in different shops. It also aims to bring maximum of different brands making the same type of producttogether. Organised Retail refers to the set-up of any retail chain supported by a well defined Supply Chain. This Supply Chain has less number of middlemen compared to the unorganised sector. Due to a number of factors like cutting down of middlemen, removing of bottlenecks along the supply chain, efficient processes, etc., the end user gets a better product at a cheaper price compared to the unorganized retail sector. As the Consumer base is growing by the minute, the Organised Retail sector has immense growth potential. 4 Difference Between organized and unorganized retail Retailing-An Introduction The word "Retail" originates from a French-Italian word "retailer" meaning someone who cuts off or shreds a small piece from something. Retailing includes activities of marketing and selling products or services to end consumers for their own household or personal use. Retailer is a Person or Agent or Company or Organization who is instrumental in reaching the Goods or Merchandise or Services to the End User or Ultimate Consumer. Kinds of Retailing Unorganised Traditional or Unorganized retail outlets are normally street markets, counter stores, kiosks and vendors, where the ownership and management rest with one person only. This sector accounts for two thirds of the market and requires low skilled labor. These are highly competitive outlets, with negligible 5 value for money and makes shopping a memorable experience. Organised Retailing Organized retailing comprises mainly of modern retailing with busy shopping malls.rental costs (unregistered kiosks or traditional property). multi storied malls and huge complexes that offer a large variety of products in terms of quality. 6 . cheap workers (work is shared by members of family) and low taxes and overheads. Organised Retailing In India. India has entered a stage of positive economic development which requires liberalization of the retail market to gain a significant enhancement. Domestic consumption market in India is estimated to grow approximately 7 to 8% with retail accounting for 60% of the overall segment. Asian markets witness a shift in trend from traditional retailing to organized retailing driven by the liberalizations on Foreign Direct Investments. In developed countries organized retailing is the established way of selling consumer products. Of this 60%. This can be contemplated as a result of the changing attitude of Indian consumers and their overwhelming acceptance to modern retail formats. The recent years have witnessed rapid transformation and increase in profits in the Indian retail stores across various categories. Indian textile industry has grown noticeably in 7 . organized retail is just 5% which is comparatively lesser than other countries with emerging economies. Despite the low percentage. For example. in China there was a drastic structural development after FDI was permitted in retailing. 000 crore in 2004-05 to Rs109. The market is growing at a steady rate of 11-12 percent and accounts for around 10 percent of the country's GDP. Indian retail market is considered to be the second largest in the world in terms of growth potential. The negative phase in exports may have compelled the Indian textile retailers to explore the opportunities in the domestic market substantially causing the outstanding growth in the concerned segment. urban consumer trends have spread across the rural areas also. The inherent attractiveness of this segment lures retail giants and investments are likely to sky rocket with an estimate of Rs 20-25 billion in the next 2-3 years. It is expected to grow 25-30 per cent annually and would triple in size from Rs 35. The shopping spree 8 . and over Rs 200 billion by end of 2010. A vast majority of India's young population favors branded garments. With the influence of visual media.organized retailing of textile products.000 crore ($24 billion) by 2010. India is on the radar screen in the retail world and global retailers and at their wings seeking entry into the Indian retail market. These indications give a positive notion that organized retailing has arrived in the Indian market and is here to stay. Tier-II cities are already receiving focused attention of retailers and the other smaller towns and even villages are likely to join in the coming years. increasing population of young people joining the workforce with considerably higher disposable income. has unleashed new possibilities for retail growth even in the rural areas. and the contribution of these tier-II cities to total organized retailing sales is expected to grow to 20-25%. Thus. This is a positive trend. Of the young Indians for clothing. 9 . favorable income demographics. 85% of the retail boom which was focused only in the metros has started to infiltrate towards smaller cities and towns. Access to the shelf or product storage area is limited. brings it out and offers it for sale to the shopper. the shopkeeper goes to the container or shelf or to the back of the store. and cannot pick or examine a product from the shelf. claiming that it is similar or equivalent to the product the consumer is asking for. The shopkeeper prices the food staple and household products arbitrarily. The product typically has no price label in these small retail shops. independent grocery and retail shops. Price is sometimes negotiated between the shopper and shopkeeper.Benefits of Organised Retail Most Indian shopping takes place in open markets or millions of small. and two consumers may pay different prices for the same product on the same day. Often the shopkeeper may substitute the product. ask for what they want. The shoppers do not have time to examine the product 10 . Once the shopper requests the food staple or household product they are looking for. Shoppers typically stand outside the retail shop. although some products do have a manufactured suggested retail price (MSRP) pre-printed on the packaging. do not have the scale to procure or transport products at high volume wholesale level. have limited to no quality control or fake-versusauthentic product screening technology and have no training on safe and hygienic storage. The unorganized retail shops source their products from a chain of middlemen who mark up the product as it moves from farmer or producer to the consumer. India has about 11 shop outlets for every 1000 people. and even within states in some cases. and do not have a choice to make an informed decision between competitive products. India's retail and logistics industry. Farmers and producers had to go through middlemen monopolies. The logistics and infrastructure was very 11 . Vast majority of the unorganized retail shops in India employ family members. There are taxes for moving goods to states. Hoarding measures" before they could open doors. employs about 40 million Indians (3. Over 14 million outlets operate in the country and only 4% of them being larger than 500 sq ft (46 m2) in size. The unorganized retail shops typically offer no after-sales support or service. organized and unorganized in combination. Finally. most transactions at unorganized retail shops are done with cash. from states.3% of Indian population).label. with all sales being final. Organized retail helps a consumer overcome these issues which were associated with unorganized retail outlets. The typical Indian retail shops are very small. packaging or logistics. and only gets into such contracts with the corporate because it benefits him. consumers in select Indian cities have gradually begun to experience the quality. Outlets such as Spinach. in the process. Alongside. India introduced widespread free market reforms. and. The organised retail system enhances efficiency in the value chain. processing and packaging stages before being delivered at the consumer's end. The value chain is truncated as the intermediate layers are pruned and. more importantly. Benefits of organised retail Let us examine what organised retail involves. is not forced to do so. warehousing (including cold storage. transportation. Between 2000 to 2010. convenience and benefits of organized retail industry. The consumer buys from these outlets because he gets the right quality at a lower price. with losses exceeding 30 percent. choice. Big Bazaar. there are vast investments 12 . an organised infrastructure structure is created. This starts at the purchase level at farm gate and moves across the packing. when required). The farmer gets a better price and grows a better quality of the product. including some related to retail. Reliance Retail and Subhiksha have been delivering quality produce at lower prices. Through the 1990s.poor. the convenience of being next door. which is the trader. there can be a social problem even though this is not one for Economics to resolve. it could replace several small ones.being made. to the extent that there would be some replacement of loyalty. Trader-corporate link-up Moreover. How does one tackle this issue? To begin with it must be stated that the so called 'mom and pop stores'. Therefore. it is but natural that if there is a large retailer. The large retailers cannot be everywhere as the investment involved is considerable. Given that retail is generally unorganised. will always have their own role to play. Home delivery services. there is a growing trend of the these shops to get associated with the larger corporate enterprises such as 13 . The Government also gains substantially as all the taxes and duties are paid along the way and there are no leakages. there is a way out. all the parties concerned stand to gain. credit facilities. personalised service etc are some of the benefits that retain customer loyalty to these outlets. which open up multiple employment opportunities of a different kind. However. availability of small quantities of goods (like sachets and in low denominations). there is one class that apparently gets affected adversely. But. But. which is the name given to our friendly retail grocer. The small retailers will become franchisees of the corporate enterprises and can enjoy a fixed income plus commissions. it is certainly not going to be anywhere close to large-scale substitution taking place.Hindustan Unilever. can actually procure from these corporate retail stores and save on costs and sell them to the consumer. Parivar and Mera respectively where the goods are sold to them at the same price as that to large retail chains on certain conditionality like focus on display or walking space for consumers. who is the last intermediary in the chain. which is also taking place in a gradual manner. which have set up their own chains with such names as Super Value. Thus. 14 . while the mindset has to change and some adjustment made. Marico and Dabber. the smaller vegetable and fruits vendors could become employees of the corporate retail chain. Further. Alternatively. the local shop owner. attitudes. motives and needs of consumers.Consumer Buying Behavior in Organized Retail INTRODUCTION Consumer is the king and hence it is the consumer who determines what a business is. In particular. therefore a sound marketing program was started with a careful analysis of the habits. a marketer should find answer to the following questions: 15 . What are the kinds of products the customers buy? Why they buy them? How they buy them? When they buy them? Where they buy them? How often they buy them? CUSTOMER BUYING BEHAVIOUR In today‟s world purchases made by a customer is to satisfy his or her needs. how consumer buy. All the behavioral activities carried out by a customer during and after the purchase of a product is termed so as “buyer behavior”. why consumer buy. Decision process and what motives them. In this article we will come across the origin of buying ideas. what is buyer behavior. WHAT IS BUYER BEHAVIOUR? 16 . types. which were not in the budget. who make decision to buy products. and thus there arises a deviation from the budgeted items and expenditure. Therefore the main objective of the seller is please the consumer at all times. and if he is educated. A buyer making a purchase of a particular product or a particular brand can be termed as “product buying motives” and the reason behind the purchase from a particular seller is known as “patronage motives” When a person gets his pay packet. A huge number of alternative suppliers are present for almost all the products today: substitute products are available to consumers. along with his wife he prepares a family budget. Consumer desire is recognized 17 . by appropriating the amount to different needs.Our economy gets stronger depending upon the wealth of goods and services produced within the country. It may happen that after a trip to the market. why they buy and how they buy. All these behavioral changes within human beings during the period of purchasing can be termed as “buyer behavior”. a seller need to identify the customer. In order to be successful. Consumer buys according to his/her needs: 1. when they buy. they could have purchased some items. what they buy. Marketers are particularly good at this through advertising. similarity with available solutions. and the time available to collect the information.g. memory) or the consumer may extend considerable effort to collect information from outside sources (e. 2. Options are evaluated after use 18 . How much amount of effort each consumer directs toward searching depends on factors such as: the importance of satisfying the need.e. 3. External factors can also trigger consumer‟s needs.g. other buyers etc.. such as hunger or thirst. The sources used to acquire the information may be minimized to the maximum like remembering the information from previous experiences (i. may tell the consumer that food or drink is needed. consumer‟s perceived desired condition). consumer‟s perceived actual condition) and would be keen in improve his/her situation (i..The first step the consumer determines that he is not satisfied (i.. friends.e. internal triggers.). Information to be searched The next step is to undertake a search for information on possible solutions..e. Internet.. in-store displays and even the intentional use of scent (e. perfume counters). For instance. brands) within each solution. At level one the consumer may create a set of possible solutions to their needs (i. a competitor offers an incentive at the point-of-purchase (e. this may change at the actual time of purchase. Evaluation after-purchase Once the purchase is over an evaluation of the decision is made. It should be noted that there may be two levels to this stage. friend is critical of purchase).. While in less 19 . the consumer may be evaluating the particular product or service (i.Consumers‟ efforts may result in a set of options from which a choice has to be made.. store salesperson mentions a competitor‟s offer). or members of the consumer‟s reference group take a negative view of the purchase (e.g. product types) while at level two. However.g. the customer lacks the necessary funds (e. if a consumer wants to upgrade his existing laptop with a new pr 4.e. Purchase In most of the cases the solution chosen by the consumer will match with the product. The “intended” purchase may be altered at the time of purchase for many reasons such as: the product is outof-stock.e. which at its extreme and it may result in the consumer returning back the product..g. For example. 5... credit card not working). If the product performs below the consumer‟s expectation then he/she will re-evaluate the satisfaction with the decision. a father may purchase snacks at the grocery 20 . It probably makes more sense to classify needs that are not a necessity as wants or desires. in planning for a family vacation the mother may make the hotel reservations but others in the family may have input on the hotel choice. In fact. For example. Similarly. while other needs are not required for survival and vary depending on the purchaser‟s taste and preferences. in many countries where the standard of living is very high. Customer service centers and follow-up market research are useful tools in helping to address the purchasers‟ concerns. Such evaluations are more likely to occur in cases of expensive or highly branded products. Why Consumers Buy: Purchases are made to satisfy the needs of the consumers. a large portion of the population‟s income is spent on wants and desires rather than on basic needs. To help the consumers to ease the concerns with their purchase evaluation. Some of these needs are basic and needed for survival.extreme situations the consumer will retain the purchased product but may take a negative view of the product. marketers need to be receptive and also take initiative steps to encourage consumer contact. and set private grades and standards which may be very difficult for the local and small farmers to achieve (Humphrey. consequently. Big stores would move towards preferred suppliers. Similar trend may be followed by the Indian supermarkets. destroying small traders. So understanding consumer purchase behavior involves not only understanding how decisions are made but also understanding the dynamics that influence purchases. 2007). He further adds that UK supermarkets selling a lot of fresh-food acquire it in ways that appear to be small-farmerunfriendly. Affect on Traders and Small Farmers: Organised Retail Stores pose great threat to the small farmers as a new supply-demand chain may be formed. Various 21 .store but his young child may be the one who selected it from the store shelf. supermarkets in India like Reliance-Fresh & Spencer's have already had this impact on the livelyhood of traders (The Economic Times. The major constraint of the organized retail market in India is the competition from the un-organized sector. mostly owneroperated. traders. some facts have to be considered to positively initiate the retail momentum and ensure its sustained growth. Moreover. Challenges that the Organized Retail Industry faces Despite the rosy hopes. therein resulting in less labor costs and little or no taxes to pay.indiatimes. supermarkets and employees who lost their jobs. (http://economictimes. due to mass protest some supermarkets had to pull out of two major states of India (Uttar-Pradesh and West-Bengal) negatively effecting farmers. Traditional retailing has been deep rooted in India for the past few centuries and enjoys the benefits of low cost structure.com). 2007). Consumer familiarity with the traditional formats for 22 . mass procurement arrangements and inventory management are areas that need the focus of entrepreneurs. social security to employees. 23 . Competition for experienced personnel would lead to belligerence between retailers and higher rates of attrition. organized sector have big expenses like higher labor costs. Liberalizing policy guidelines for FDI needs focus as well. but also for the development of our own retailing industry. Taking care of supply chain management. The process of avoiding middlemen and providing increased income tofarmers through direct procurement by retail chains need the attention of policy makers. Availability and cost of retail space is one major area where Government intervention is necessary.generations is the greatest advantage to the un-organized sector. India is now on the radar of global retailers. Accelerated development of retailing industry in the country and building brand value of domestic products is essential not only for marketing our consumer products more efficiently. Proper training facilities for meeting the increasing requirements of workers in the sector would need the attention of both Government and the industry. bigger premises. especially during the phase of accelerated growth of the retail industry. On the contrary. and taxes to meet. \ Total retail employment in India. For example. A complete expansion of retail sector to levels and productivity similar to other emerging economies and developed economies such as the United States would create over 50 million jobs in India. In November 2011. LITERATURE REVIEW According to the Rangarajan Committee. India's labor productivity in food retailing is about 5% compared to Brazil's 14%. account for about 6% of Indian labor work force currently . and about half of levels in other emerging economies.most of which is unorganized. Modern Organised Retail will help in containing inflation 24 . the Indian government announced relaxation of some rules and the opening of retail market to competition. both organized and unorganized. Training and development of labor and management for higher retail productivity is expected to be a challenge. AMcKinsey study claims retail productivity in India is very low compared to international peer measures. while India's labor productivity in non-food retailing is about 8% compared to Poland's 25%. This about a third of levels in United States and Europe. the labor productivity in Indian retail was just 6% of the labor productivity in United States in 2010. Hence. Reference-Groups: Store-choice decisions are influenced by different attitudes across the society. 2004) argue that high levels of personalised services such as credit and home-delivery offered by 'transformed kirana stores' (corner-shop) are making shoppers reluctant to the supermarket format as a result several successful chains are delaying their expansion. "Cultural meanings include common affective reactions. This certifies high intolerance of uncertainty and slow adaptation towards change which can further be supported by diffusion of innovation. There have also been common cross cultural changes over the world which can be applied to the Indian market due to considerable cultural transformation. 2004) suggest that supermarkets are more prevalent across a broad range of developing countries. a framework developed by Everett Rogers (Keegan 2005). group-shopping. and reference-groups (Schutte 1999). The Economist (1997) contradicts the above by showing more than 40% of the Indian population is vegetarian and consumers dislike frozen products including beef & pork. On similar lines (Currah and Wrigley. The western market's impact has created similar opportunities for the supermarkets in India. 2005). However. (Sinha & Bannerjee. The subject matter of changing attitudes and cross culture influences has had a considerable impact on the consumers of India. India is rated relatively high on Hofstede's uncertainty-avoidance dimension showing increasing use of opinion leaders. typical cognitions. a trend that 25 . and characteristic patterns of behavior" stated in (Olson & Peter. In the Asian context the importance of response by referrals along with acceptance of an innovation reduces the perceived risk of product/store choice. Trivedi S (2008) has observed that standardization of malls is one of the common phenomenons among malls developers. Generally observed black spots are outlets near the entrance. Developers have not thought greatly about the local catchment profile. However. Now these products are available in the supermarkets as major attractions for the ever-changing Indian society. demand for foreign food products is high and continues to grow. contrary to the real shopping take place. This may pose a serious threat to the supermarkets due to the lack of interest in processed food. people are opting shopping more for their entertainment purpose. Supermarkets prevent these climatic and hygiene problems faced by the consumers. 1143) further adds that sales for processed and packaged food at the supermarkets are relatively low as compared to fresh food.bends away from the supermarket-culture. However. For example. Shops around the atrium get the maximum number of shoppers. Reardon et al (2003. They are called black spots of mall. Author talks about black spots of malls. He says malls attract different level of footfalls and attention from shoppers within its various parts. outlets near escalators and elevators and outlets at the 26 . About a decade ago people used to bring foreign goods from trips abroad Bullis (1997). as regular shops don't have suitable temperature control equipment nor are backed up by 24 hour electricity. Nowadays. Shopping Malls have given birth to a new shopping culture 'Shoppertainment'. ground floor attracts more footfalls than any other floor. The look and feel of all malls in general is same and somewhat presents a uniform appearance to the customers. Standardization has its own benefits but uniformity may tend to dull customer's desire. there are certain locations in the mall which are overlooked by visitors. where people can spend time with their family. especially youth spend their entire day at the mall. Like movie theatres. Strong entertainment needs to be in a mall to encourage loyalty to the mall. Localization with Globalization is necessary for malls. Pyramid etc. restaurants. Gopal P (2007) When people go for shopping. arcade games. Increase in footfalls is not only important but to convert those footfalls into consumption is the key to success. Shinde D (2008) suggests that Customers are willing to travel to a nearby mall for that shopping experience that he doesn't get in the local kirana store. Globus. National and international retailers are finding difficult to understand the psyche of the local Indian customers. The most common mistake done by national retailers is Standardization.end of galleries. Store differentiation is missing from Indian organized retail. Most of the malls are providing the same things for entertainment. The focus of this study was on branding the retail business itself. 27 . offer common brands. National retailers have to take care about making the brand relevant to the local consumer in the catchment area of the stores. They want entertainment also for spending an entire day there at the mall. Lifestyle. Leading retail stores like Shoppers stop. they. Situation of lack of professional suppliers in India is also testing the supply-chain of these organized retail stores as the availability of stock is one of the major factors for building loyalty for a particular store. bowling alleys. No real differentiation could be seen among the malls . Need of the hour is to create a mall. similar ambience and a same commitment to improved service. The research stresses on retail as a brand rather than retailers merely selling brands. Real differentiation is lacking among them. their tastes or preferences etc. small and marginal traders would be affected once the share of the overall modern retail in food reached 25-30 per cent. he said the FDI proposals in the retail sector were expected to be received in the next few months. Chairman of the Economic Advisory Council to the Prime Minister. he said. kirana. FDI will affect small traders unless they adapt: Rangarajan(rangarajan committee said it was a wrong notion 28 . it was not known how much FDI would flow into the retail sector in the country. Modern organised retail will be helpful in containing inflation and allowing foreign direct investment (FDI) in multi-brand retail leads to development of back-end infrastructure that will benefit farmers. “Modern retail has been found to offer better prices to consumers than traditional retail. Rangarajan pointed out. According to Rangarajan.” he added. On the flip side. He said the fear that allowing FDI could result in large-scale replacement of small retailers was misplaced. At present.” he said in his inaugural address at a seminar on „Organised Retailing vis-a-vis Farm Economy of India‟ held here on Friday. They could also organise themselves through franchises. “India is a vast country. thus helping to contain inflation. these kirana stores and street hawkers could become a part of the modern retail change story if they could be assimilated into organised retail or upgraded through infusion of capital and better training. There will be place for both large retailers and small farmers. It would also lead to growth in related infrastructure as 50 per cent of the total investment brought in has to be invested in back-end infrastructure. according to C Rangarajan. the decision to allow FDI in multi-brand retail would give a substantial boost to the retail sector. However. Speaking to mediapersons. The consumers have started looking towards the retail stores. The change in the retail system and the effect on the consumers need an in depth study to assess the impact of retail stores on the present retail system. 29 . It has a huge impact on the tradition buyers. To get all the things under one roof and get rid of the tradition bargain system.that FDI in multi-brand retail would replace small retailers on a large scale) NEED AND SCOPE OF STUDY The Indian retail industry has been fast growing and consumers have started to shift towards retail stores. The retail chain has been fast multiplying with new outlets opening every day. There has been a change in the consumer's attitude towards retail buying after the emergence of Retail Stores. The study will try to assess the Impact made by the Stores on consumers and change in the buying behaviour of the consumers. Also the study will extend it wings towards the factors affecting the consumer buying behaviour.The study will look into the different social and demographic reasons of the consumers for their shifting towards Retail Stores. RESEARCH OBJECTIVE 30 . The Indian population is witnessing a significant change in its demographics. supermarkets and specialty stores.INDIAN RETAIL SECTOR The retail sector in India is witnessing a huge revamping exercise as traditional markets make way for new formats such as departmental stores. hypermarkets. The sector is at an inflexion point where the growth of organised retailing and growth in the consumption by the Indian population is going to take a higher growth trajectory. Organised 31 . Western-style malls have begun appearing in metros and second-rung cities alike introducing the Indian consumer to a shopping experience like never before. dominance of the younger population in spending.5 per cent on different products. finding property in commercial markets is becoming difficult. Further. The Government of India (GOI) prohibits FDI in retail except for single-brand JVs with up to 51 per cent equity share. various brands which are gaining value thereby enhancing industry growth. some states levy entry tax. The Indian retail sector is highly fragmented. owner-managed shops. The domestic organized retail industry is at a nascent stage. shift of the traditional family structure towards the nuclear family are buttressing the organized retail growth in India. in some states. Besides. Presently. Being considered as a sunrise sector of the economy. The recent growth of the retail industry is already impacting the commercial real estate sector. urbanization. and expensive technology are making the retail industry capital intensive. As a result of shortage of land and rising property prices. Taxes differ from state to state on the movement of goods: for instance. At the macro level factors such as rising disposable income. On the one hand. sea change in demographics of country and international exposure. The growth is boosted by various factors such as availability of professional practices. the local municipal government also levies octroi.retail is on all time high in India. regulations like VAT implementation to make processes simple. for operational efficiencies. a few levy exit taxes. availability of various funding options. The current regulatory environment is not very conducive to the growth of modern retail in India. the lobby against modern retail is 32 . infrastructure constraints. consisting predominantly of small. backward and forward. rising real estate prices. the advancement of information technology is improving end-to-end business processing by integrating the entire value chain. media proliferation. there is the central sales tax (CST) of 3 per cent on inter-state sales and value added tax (VAT) of 4-12. The licensing process for organized retail is cumbersome requiring as many as 33 licensing protocols. the land conversion process is complex. independent. several large business houses are entering the retail industry under multiple modern retail formats. On the other hand. But. Organised retailing has definitely made headway in the upper class. small ones. However. the economies of an efficient supply system will give the modern retailers a distinct edge over the unorganised. vegetables and a significant portion of `through-the-month' purchases seem to be done at traditional outlets. fruits. There may be initial hiccups for the large players in getting the sourcing and the supply chain to work smoothly but sooner or later. share their views on this development. Though there are positive outcomes of modern retail. except for `curiosity' shopping. and Partner . Paresh Parekh.Retail and Consumer Products. Organised retail outlets seem to be associated with branded items/special purchases. Pinakiranjan Mishra. The middle income class prefer shopping for processed food and personal care in supermarkets and fall back on traditional outlets for bulk shopping. Partner & National Leader .mounting in recent months from traditional retailers.Tax. Organised retailing does not seem to have made an impact on the lower class. items such as milk. organized retailing has its own set of challenges: Expected impact of FDI in Retail – Ernst & Young India Viewpoint The Union Cabinet has approved 51% FDI in multi-brand retail and raised the cap on FDI in single-brand retail from 51% to 100%. with the most important one being the better price realization potential for the farmer and the price-inflation dampening effect for the hundreds of millions of lower and middle income consumers. Growth of the Retail sector in India . even in this segment.Improvement in Retail capability building 33 . FDI in retail will mean that the farming community will have a new support group with a common interest which is expected to give a great push to productivity. FDI in retail will make way for inflow of knowledge from international experts which can give boost to the overall growth of the industry.Improvement in management of supply chain FDI in retail will boost investment in infrastructure from the retail players.About 5-7 years back. Capability building apart from financial investments is extremely important for the industry. Push to Infrastructure .The Farming Community in India Our productivity in food & agriculture is one of the lowest in the world and there is a significant opportunity for up-liftment of output with investment in better farming practices. 34 . 3rd party supply chain companies as well as the Government in the back of a sophisticated front end that international players are likely to bring. increase efficiency and reduce the overall cost to the consumer Push to productivity . which will bring down the wastage. This will improve the efficiency of the supply chain. Lack of retail experience & capability has been one of the primary reasons for this subdued growth. the industry was expected to grow at a much faster rate than what it actually has. Retail and Consumer Products. this could also result in combination of existing cash and carry operations of foreign players with retail operations of Indian retailers. or. Besides new entrants / joint ventures.The above views are shared by Pinakiranjan Mishra.03% [Rs 204 cr / usd 44 mn] of total FDI investments from April 2000 to September 2011. which is ranked amongst the top retail destinations in the world. Multi brand This is a welcome and historic step. We could also potentially see present licensing / distributor / franchise arrangements being converted to either JVs with respective foreign retailer / brands. Also. FDI investment in single brand retailing till now has just been 0. or buy outs / increase in stake / M&A amongst existing single brand JVs with foreign partners. or. Partner & National Leader . by way of either new foreign entrants. Ernst & Young India. Likely impact if there is relaxation of FDI policy in Retail Single brand This is a welcome step. This is likely to result in increase in investments and growth in Indian retail sector. foreign retailer acquiring stakes in existing Indian retail entity. foreign retailers completely buying out the Indian licensee / franchisee / distributor. This relaxation is likely to result in increase in FDI in retail sector. this could provide further options to existing Indian retail 35 . RESEARCH METHODOLOGY QUESTIONNAIRE ( CONSUMER ) College Research ( Jagannath International Management School. Also.Tax. The essay examples we publish have been submitted to us by students. foreign multi brand retailers. Partner . who did not want to enter India through cash and carry operations. may now explore Indian presence by having stake in Indian retail compan The above views are shared by Paresh Parekh.chains / groups to raise long term capital for expansion and maybe to attract partnerships with some global players. Vasant Kunj) Name Age Gender 36 . Ernst & Young India. The essays are the students' work and are not examples of our expert essay writers' work. .Ve ry Hel pful.00.00. Not He lpful.00.Occupation Student Service Self Employed Other: Annual Income Below Rs 5.000 Why did you choose this organised retail outlet? Variety Attractive Offers Personalized Service Other: Was this your first time buying a laptop? Yes No Were you sure of the model you wanted to buy? Yes No Did you seek assistance? Yes No Till what extent did you find the assistance helpful? Rate on a scale of 1 to 5 1 Not Helpful Selec t a value from a range of 1.00. to 5.000 -15.000 Above Rs 15.000 Between Rs 5. 2 3 4 5 Very Helpful Were the sales persons well aware of products and its features? 37 . Rate on a scale of 1-5 1 Unaware Selec t a value from a range of 1. Unaware. t o 5. 2 3 4 5 Well Aware Did the assistance provided influence your buying decision? Yes No Suggestions for improvements in sales persons to make this experience better? Submit QUESTIONNAIRE (SALES PERSONNEL) College Research(Jagannath International Management School) Name Gender Male Female Name Of Outlet Prior Work experience in this field? Yes No Were you trained before joining the outlet? 38 ..Wel l Awa re. We ll Eq uipped. to 5. 2 3 4 5 Satisfied Suggetions for improvement 39 . Unsat isfied . 2 3 4 5 Well Equipped Do you feel you require further training? Yes No Are you satisfied with the rewards and bonuses received for meeting sales targets? "If Any" 1 Unsatisfied Selec t a value from a range of 1. Sati sfied. Yes No Are you well versed with specifications of the product? Yes No Average number of customers attended to in a day? Below 15 Between 15 .. to 5.30 Above 30 On an average how many consumers become buyers after your assistance? Till what extent do you think you are equipped to solve buyer query? 1 Not Equipped Selec t a value from a range of 1. Not Eq uippe d.. Submit 40 . 000 22 41% 19 35% 13 24% 41 .00.00.00.FINDINGS (Consumer survey) Occupation Student Service Self Employed Other 12 20% 27 46% 17 29% 3 5% Annual Income Below Rs 5.000 Above Rs 15.000 Between Rs 5.000 15.00. Why did you choose this organised retail outlet? Variety Attractive Offers Personalized Service Other 33 55% 16 27% 10 17% 1 2% Was this your first time buying a laptop? Yes No 23 39 37% 63% Were you sure of the model you wanted to buy? Yes No 33 28 54% 46% 42 . Did you seek assistance of the employees at the outlet? Yes No 44 14 76% 24% Till what extent did you find the assistance helpful? 1 2 3 4 5 2 9 22 16 7 4% 16% 39% 29% 13% 43 . Were the sales persons well aware of products and its features? 1 2 3 4 5 1 15 14 19 8 2% 26% 25% 33% 14% Did the assistance provided influence your buying decision? Yes 36 60% No 24 40% 44 . FINDINGS(Sales Personnel Survey) GENDER Male Female 22 76% 7 24% Prior Work experience in this field? Yes No 20 9 69% 31% Were you trained before joining the outlet? Yes No 22 73% 8 27% 45 . 30 Above 30 10 36% 14 50% 4 14% 46 .Are you well versed with specifications of the product? Yes No 26 2 93% 7% Average number of customers attended to in a day? Below 15 Between 15 . Till what extent do you think you are equipped to solve buyer query? 1 2 3 4 5 0 6 6 11 5 0% 21% 21% 39% 18% Do you feel you require further training? Yes No 18 9 67% 33% 47 . INFERENCE Consumer People prefer organized retail outlets for the wide variety of products available. More than Two-third of prospective consumers that walk into organized retail outlets seek the assistance of sales personnel It was observed that at least 6 out of 10 were influenced in their buying decision by employee interaction Almost half of prospective consumers were from service sector More than 50% were aware of they were looking for beforehand 48 . Sales Personnel More than 60% employees had prior experience in the field of electronic goods. As many as 50% of employees attended to a minimum of 15 customers a day. 67% of the sales force feels they need further training to meet the ever changing technology 49 . Almost 90% of the sales personnel were well aware of product specifications. The tools used to arrive to the following conclusion as mentioned above is a quantitative primary source of data(Questionnaire).Conclusion Based on the data collected. 50 .as well as a qualitative aspect of the conclusion which was identified by a personal interview of the consumer as well as a senior sales manager. analysed and interpreted we have reached to the conclusion that employee interaction is the most important factor in converting prospective clients into loyal customers for the organized retail outlet. More than half of the consumers prefer organized retail outlets primarily availability of a wide variety of products. this is one of the reasons why organized retail in electronics has tremendous potential in the current scenario. This goes to show that trained employees in organized retail outlets can overcome the major limitation of said outlet i. owned a laptop. personalized sales? Due to this a skewed observation is made which is the variety of products as well as the trained sales personnel enable the consumer to decide precisely what kind of laptop is best suited for their needs. but feel the need to make the purchase as a reason of technology getting obsolete. the core competency and USP of an organized retail outlet is the fact that it offers multi branded products to the consumers as opposed to a traditional store where products of a particular brand are available. this is an important detail because though most of the consumers have at some point in time.e. As mentioned above a majority of purchases of the product (laptop) are from consumers who earn less than 5.00 annually. Two-thirds of the consumers had already purchased a laptop in the past.Consumer Survey 46% of the consumers are employed in the service sector. This highlights the fact that service sector employees have the highest demand among people from varied occupations.00. This analyzed statistic helps the firm in determining their target market. 51 . This is because. The research shows that more than 80% of the consumers found the assistance provided by trained employees to be more than moderately helpful to the consumer to influence consumers buying decision. 52 . The next facet of the enquiry of consumers was to determine whether or not they thought that the employees were well aware of the product and its features we have concluded that three-fourths of the consumers were more than moderately Satisfied with the personal assistance this clearly indicative that . Salesmen Survey 53 . Suggestions 54 . 55 . 56 .