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M. P. Birla Institute of Management 1 An In-depth Analysis on Big Bazaar retail outlet (Koramangla) In Bangalore Metropolitan Area Submitted in partial fulfillment of the requirements of The M. B. A. Degree Course of Bangalore University Submitted By Adipta Singh Chauhan (REGD. NO: 05XQCM6007) Under The Guidance and Supervision OF Mr. Ritesh Ranjan Mrs. Sumithra Sreenath Store Manager, Big Bazaar Professor, MPBIM (External Guide) (Internal Guide) M. P. BIRLA INSTITUTE OF MANAGEMENT Associate Bharatiya Vidya Bhavan # 43 Race Course Road, Bangalore-560001 2006-07
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Analysis on Big Bazaar retail outlet (Koramangla)

Oct 14, 2014

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Page 1: Analysis on Big Bazaar retail outlet (Koramangla)

M. P. Birla Institute of Management

1

An In-depth Analysis on Big Bazaar retail outlet (Koramangla) In Bangalore Metropolitan Area

Submitted in partial fulfillment of the requirements of

The M. B. A. Degree Course of Bangalore University

Submitted By

Adipta Singh Chauhan

(REGD. NO: 05XQCM6007)

Under The Guidance and Supervision OF

Mr. Ritesh Ranjan Mrs. Sumithra Sreenath Store Manager, Big Bazaar Professor, MPBIM (External Guide) (Internal Guide)

M. P. BIRLA INSTITUTE OF MANAGEMENT Associate Bharatiya Vidya Bhavan

# 43 Race Course Road, Bangalore-560001 2006-07

Page 2: Analysis on Big Bazaar retail outlet (Koramangla)

M. P. Birla Institute of Management

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DECLARATION I hereby declare that this report titled “An In-depth Analysis on Big Bazaar retail outlet (Koramangla) in Bangalore Metropolitan Area” at Big Bazar is a record of independent work carried out by me towards the partial fulfillment of MBA course of Bangalore University at M. P. Birla Institute of Management. This has not been submitted in part or fulfillment towards any degree.

PLACE: BANGALORE DATE Adipta Singh Chauhan

(05XQCM6007)

Page 3: Analysis on Big Bazaar retail outlet (Koramangla)

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PRINCIPAL’S CERTIFICATE

This to certify that this report titled An In-depth Analysis on Big Bazaar

retail outlet (Koramangla) in Bangalore Metropolitan Area has

been prepared by Adipta Singh Chauhan bearing the Reg. No. 05XQCM6007

under the guidance and supervision of Mrs. Sumithra Sreenath, Professor,

MPBIM, Bangalore.

Place: Bangalore Principal

Date: (Dr. N. S. Malavalli)

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M. P. Birla Institute of Management

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GUIDE’S CERTIFICATE This is to certify that the Project Report entitled “An In-depth Analysis on

Big Bazaar retail outlet (Koramangla) in Bangalore Metropolitan

Area” done by Adipta Singh Chauhan bearing Registration No.05XQCM6007

is a bonafide work done carried under my guidance during the academic year

2005-07 in a partial fulfillment of the requirement for the award of MBA degree

by Bangalore University. To the best of my knowledge this report has not

formed the basis for the award of any other degree.

Place: Bangalore Mrs. Sumithra Sreenath

Date: (Professor MPBIM)

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ACKNOWLEDGEMENT

I am indebted to Mr. Ritesh Ranjan, the store manger, Big Bazaar Kormangala for

providing me guidance throughout the project.

A very special thanks to Mrs. Sumithra, Faculty, MPBIM, Bangalore who has always helped

the students to achieve the best through his words of encouragement and being very

supportive by providing us with an excellent Concepts of Retail Marketing.

Finally, I remain indebted to my parents who helped me throughout the project by giving me

their invaluable feedback, inspiring me and guiding me.

Mrs. Rujuta Mayekar, HR manager, Kormangala Big Bazar.

Mr. Elangovan Sanbamdam, Store Manager.

Mr. Ajay Obhan, ASM, Food Bazaar

Mr. Rajesh Tawade, ASM, Apparels, Big Bazaar

Mr. Tanveer shaikh, ASM, GM, Big Bazaar

Mr. Hitesh Somani, ASM, Big Bazaar

Mr. Jitendra Talreja, DM, Food bazaar

Mr. Amrit, Management Trainee

And all the team leaders and team members who helped me out in knowing the

grassroot functioning of the store.

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Table of Content

1. Executive Summary 7

2. Objective of Study 8

3. Scope of Study 9

4. Industry background 10

5. Introduction to Operational Parameter 16

6 Research methodology 17

7. Sales of the Store 21

8. Footfall 23

9. Sales VS Footfall 25

10. Average number of bills per day 26

11. Conversion 26

12. Ticket Size 28

13. Average Sales per square feet 29

14. Average value per piece and per bill 31

15. Study of Impulse buying behavior 34

16. Researchers Opinion 36

17. Comaparitive Study with other stores 39

18. Ideas that can work for store 41

19 Attractive Offers 43

20 Bibliography 45

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Executive Summary

This project is a study of Big Bazar Operation parameters (OP) in Kormangla,

Bangalore and the overview of the factors on which a efficiency of stores depends.

Other than general overview of the current operations parameters, the project aims to

look into the details of how a floor area is being used by the stores to increase their

profit or earnings, thereby increasing the productivity and efficiency of the outlets.

Based on the findings of a Six-week study, this report identifies certain loopholes in the

merchandising policy as well as in outlets policy.

Finally, the report provides possible solution to the above problems in the form of

recommendation as well as certain suggestion for more optimal use of outlet.

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Objective of the study:

• To know the organized retail segment in Bangalore.

• To understand how they are managing their operations in super

stores.

• To analyze the daily Sales of the Store and to understand about the

product movements.

• To analyze the number of Customers visited the store/Footfall per

day

• To analyze number of Bills/ transactions per day

• To understand the Conversion percentage

• To analyze average value per bill

• To analyze average value per piece

• To analyze average piece per bill

• To analyze average Sales per square feet

• To understand the brand and the price preference of the store

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SCOPE OF THE STUDY

The scope is limited to the extent of the place, time, organization and their information

collected during the project. It is done as a part of academic study. The scope o f the

study limited to information supplied by the Department Head and information

collected by standing order and settlement copies of the company.

The information collected is limited to the academic knowledge gained by the student

during the study of the course.

The study is confined only to Big Bazar (Kormangla), Bangalore.

The study is not proposed to be an expert study as it was done by a student for the

purpose of a partial fulfillment of the course is the planned training, which is an

integral part, in completion and reward of MBA.

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Industry Background

Retailing consists of those business activities involved in the sale of goods and services to

consumers for their personal, family, or household use. Retailing comprises of four elements:

customer orientation, coordinated effort, value-driven, and goal orientation.

Drivers of change in retailing

- Changing demographics and industry structure

- Expanding Computer technology

- Emphasis on lower cost and prices

- Emphasis on convenience and service

- Focus on productivity

- Added experimentation

India emerges as most attractive retail market

According to AT Kearney’s report – ‘Emerging Market Priorities for Global Retailers’, The

2006 Global Retail Development Index TM, India ranks as the most attractive emerging

market as a retail destination. India’s retail market has grown by 10% on an average in the past

five years. The report attributes the changing retail landscape in the country to the increasing

mobility among the middle and upper classes and increasing urbanization. The table below

displays the ranking of different countries and the various parameters considered in arriving at

these rankings.

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Essentials of Retailing

Customer orientation- The retailer makes a careful study of the needs of the customer and

attempts to satisfy those needs.

Goal orientation – The retailer has clear cut goal and devises strategies to achieve those goals.

Value driven approach- the retailer offers good value to the consumer with merchandise

having the price and quality appropriate for the target market.

Coordinated efforts- Every activity of the firm is aligned to the goal and is designed to

maximize its efficiency and deliver value to the consumer.

Four Axes of Retail scale up

The broad parameters along which the retailing activity can be scaled up. It represents the

choices available before a retailer in terms of how the business model can be designed. The

four parameters are the products that can be offered, the markets in which the retailer

may have a presence, the retailing format that may be adopted for operation and

the profile of the customers that are identified as the target segment. These four parameters

are interlinked and together frame the strategic disposition of the retail business.

Organized Retail is evolving with changing customer aspirations

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Organized retailing in most economies has typically passed through four distinct phases in its

evolution cycle. In the first phase, new entrants create awareness of modern formats and raise

consumer expectations. In the second phase consumers demand modern formats as the markets

develop – thereby leading to strong growth. As with the life cycle in any industry, the high rate

of growth would lead to a stage where the market would reach maturity and all the players

would strengthen their positions. This will be followed by the final phase where the market

would reach saturation, the growth would be limited and for sustainable growth, retailers

would explore new markets as well as evaluate inorganic opportunities.

Stages in growth of organized Retail

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Glimpse of Big bazaar

Big Bazar Retail (India) Limited, is India's leading retail company with presence across multiple

lines of businesses. The company owns and manages multiple retail formats that cater to a wide

cross-section of the Indian society and is able to capture almost the entire consumption basket of the

Indian consumer. Headquartered in Mumbai (Bombay), the company operates through 5 million

square feet of retail space, has over 331 stores across 40 cities in India and employs over 17,000

people. The company registered a turnover of Rs 2,019 crore for FY 2005-06.

Big Bazar Retail forayed into modern retail in 1997 with the launching of fashion retail

chain, Big Bazar in Kolkata. In 2001, it launched Big Bazaar, a hypermarket chain that combines

the look and feel of Indian bazaars, with aspects of modern retail, like choice, convenience and

hygiene. This was followed by Food Bazaar, food and grocery chain and launch Central, a first of

its kind seamless mall located in the heart of major Indian cities. Some of its other formats include,

Collection (home improvement products), E-Zone (consumer electronics), Depot (books, music,

gifts and stationary), ALL (fashion apparel for plus-size individuals), Shoe Factory (footwear) and

Blue Sky (fashion accessories). It has recently launched its retailing venture, futurebazaar.com.

The group's subsidiary companies include, Home Solutions Retail India Ltd, Big Bazar

Industries Ltd, Galaxy Entertainment and Indus League Clothing. The group also has joint venture

companies with a number of partners including French retailer Etam group, Lee Cooper, Manipal

Healthcare, Talwalkar's, Gini & Jony and Liberty Shoes. Planet Retail, a group company owns the

franchisee of international brands like Marks & Spencer, Debenhams, Next and Guess in India.

Big Bazar Retail is the flagship enterprise of the Future Group, which is positioned to cater to the

entire Indian consumption space. The Future Group operates through six verticals: Future Retail

(encompassing all retail businesses), Future Capital (financial products and services), Future

Brands (management of all brands owned or managed by group companies), Future Space

(management of retail real estate), Future Logistics (management of supply chain and

distribution) and Future Media (development and management of retail media).

Future Capital Holdings, the group's financial arm, focuses on asset management and consumer

finance. It manages two real estate investment funds (Horizon and Kshitij) and consumer-related

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private equity fund, In division. It also plans to get into insurance, consumer credit and other

consumer-related financial products and services in the near future.

Future Group's vision is to, "Deliver Everything, Everywhere, Everytime to Every Indian Consumer

in the most profitable manner." One of the core values at Future Group is, 'Indianess' and its

corporate credo is - Rewrite rules, Retain values.

The customers in Big Bazaar are in the zone of indifference and there is a need to bring the

customers from the zone of indifference to the zone of loyalty as with the coming of new

players in the industry and the level of competition increasing, it becomes critically important

for the stores to create loyalty customers rather than just customers. A customer satisfaction

index is a snapshot at a point in time. People’s views change continuously and the performance

of companies in delivering customer satisfaction is also changing. Measuring satisfaction must

be a continuous process. Tracking surveys provide benchmarks of one’s own company’s

performance and, if competitor suppliers are also being measured, there will be measurements

of relative performance.

Big Bazaar Kormangla

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Introduction to the Operational Parameters

When we want to evaluate the store efficiency, we can divide it into three critical to quality

components: Customer Intimacy, Product availability, and employee efficiency.

Customer Intimacy- The ability to provide a seamless cross channel shopping experience

through a single view of customer information and establishment of an going, interactive

relationships throughout the entire shopping process.

Product Availability – The ability to ensure in stock conditions without excess supply chain

inventory, pricing integrity preservation or a consistent view of product information across all

channels.

Employee Efficiency- The ability to empower every store associate to deliver top quality

service, improve productivity and comply more effectively with home office directed

initiatives.

When we talk about the operational parameters we try to track down the following:

- Daily Sales of the Store

- Number of Customers visited the store/Footfall per day

- Number of Bills/ transactions per day

- Conversion percentage

- Average value per bill

- Average value per piece

- Average piece per bill

- Average Sales per square feet

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RESEARCH METHODOLODGY

Type of research: It is the descriptive type of research which envolves various parameters of the store. This

research takes care of all the operational parameters in detail.

Analysis method:

Regression and Correlation analysis

Regression and correlation analysis shows us how to determine both the nature and the

strength of a relationship between two variables.

In this analysis there are two types of variables:-

(a.) Independent variables – Footfall(X)

(b.) Dependent variable – Sales(Y)

Y= a+ b X

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Sales(Y) Footfall(X) XY Y2 X2 30 79 2370 900 6241 11 32 352 121 1024 10 34 340 100 1156 10 29 290 100 841 12 33 396 144 1089 20 48 960 400 2304 30 86 2580 900 7396 11 30 330 121 900 10 34 340 100 1156 10 27 270 100 729 10 30 300 100 900 11 38 418 121 1444 20 50 1000 400 2500 26 64 1664 676 4096 12 32 384 144 1024 11 27 297 121 729 9 28 252 81 784 9 31 279 81 961 13 39 507 169 1521 27 64 1728 729 4096 45 110 4950 2025 12100 12 38 456 144 1444 10 42 420 100 1764 9 36 324 81 1296 9 37 333 81 1369 11 40 440 121 1600 17 52 884 289 2704 25 85 2125 625 7225 10 36 360 100 1296 10 42 420 100 1764 8 24 192 64 576

Y=468 X=1377 XY=25961 Y2=9338 X2=74029

Mean of X(x) = 44.42

Mean of Y(y) = 15.10

(XY)-n(x)(y)

b= ---------------------

(X2) – n(x)2

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25961-31(44.42)(15.1)

b= ------------------------------

74029- 31(44.42)

b= .402

a = y - b x a= 15.10 – (.402)(44.42)

a = -2.757

The above equation can be used for projections of the future sales. For example:

Taking X= 50 (i.e. we take that footfall will be 5000)

We get,

Y= - 2.757 + .402(50)

Y= 17.343 (i.e. the sales will be around 17 lacs, if footfall is 5000)

Correlation Analysis

Correlation analysis is the statistical tool we can use to describe the degree to which one

variable linearly related to another.

a(Y)+ b(XY) –n(y)2

r2 = ----------------------------

Y2- n(x)2

r2= .915

r= .9567

Y= -2.757+.402X

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Finding of Analysis:

There is a high degree of correlation between sales and footfall of the store.

If we want to increase the sales we should focus on the footfalls as we can see that there is a

positive correlation of .9567. this shows that both sales and footfall are highly correlated to

each other and hence if store wants to increase is sales then it has to concentrate on increasing

the footfall inside the stores

Shortcomings of the above analysis

• Figures are rounded off for the purpose of calculations

• Sales are in lakhs and footfalls are in hundreds

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Sales of the store per day

A sale is the major indicator of the performance of the store as a whole. The responsibility lies

on the shoulder of both the in-door and out-door marketing as well as the product range, the

human resource and customer service plays a vital role in the movement of the sales figure.

Months Weekdays Saturday Sales Sundays Sales January 1272180 2358716 2171998

February 772182 1365835 2152877

March 720952 1445894 2233612 April 1146286 2137182 3174132 April(ExcludingBig Day) 989715 1932475

2728789

Sales for the month of April

weekdays

Saturday

Sunday

0500000

100000015000002000000250000030000003500000

weekdays Saturday Sunday

sales

0

500000

1000000

1500000

Jan Feb March April

Week days Sales Trend

JanFebMarchApril

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0

500000

1000000

1500000

2000000

2500000

Jan Feb March April

Saturdays Sales Trend

JanFebMarchApril

0500000

10000001500000200000025000003000000

Jan Feb March April

Sundays Sales Trend

JanFebMarchApril

Comments

• As Big Day(Jan 26,27,28) was held in the month of January therefore the

average sales has gone up to 1272180 on weekdays but if we exclude the Big day sales

the average sales comes out to be Rs. 689413,Saturdays average sales is Rs. 1405293.

• Similarly in April, we had Big Day(April 19,20,21), therefore the average sales have

jumped by 5% on weekdays, around 14-15% on Saturdays and around 16% on

Sundays.

• Sales had dipped in the months of February and March but in April the sales are

showing growing trends.

Reasons:

1. Price challenge campaign.

2. Schemes were attractive and advertised well media.

3. The retail industry grew by .5%.

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4. In the month of February and March shortage of stock was a problem but the

problem was overcome in the subsequent month.

Footfall

Footfall is the number of people visiting the store in a day. These customers can be old

customers or can be the new customers. Footfall data provides user-friendly management

reports, which will help us answer questions about operational efficiency and marketing

effectiveness, allowing us to implement change and realize significant savings.

footfall as a tool for measurement

Footfall figures are an important Key Performance Indicator and also combine with other

KPI’s, such as sales data, to provide management information capable of helping to drive

improved productivity from our shoppers and staff. Use as the basis for planning the running

and organisation of our stores, or to understand strategic or tactical market opportunities.

Months Weekdays Footfalls Saturday Footfall Sunday Footfall Jan 4975 9797 7561 Feb 2633 3948 6439 Mar 2418 3686 5784 Apr 3561 5339 8565 Excluding Big day(April) 2728 3994 7081

0

1000

2000

3000

4000

5000

Jan Feb March April

Weekdays footfall Trend

JanFebMarchApril

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0

2000

4000

6000

8000

10000

Jan Feb March April

Saturdays Footfall Trend

JanFebMarchApril

0

2000

4000

6000

8000

10000

Jan Feb March April

Sundays Footfall Trend

JanFebMarchApril

0

2000

4000

6000

8000

10000

Weekday Saturday Sunday

April Footfall Trend

WeekdaySaturdaySunday

Comments:

• Footfalls have similar trends on weekdays and Saturdays, whereas footfalls increase

during the Sundays.

• Footfalls have increased in the month of April due to summer vacations.

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Sales Vs Footfall

The tracking these operational parameters help us to establish relationship between the footfall

and sales of the store. From the below graph we can say that there is a direct relationship

between the two parameters.

Relationship Sales and Footfall

0

500000

1000000

1500000

2000000

2500000

3000000

3500000

4000000

4500000

5000000

1-Ma y2-Ma y

3-Ma y4-May

5-Ma y6-Ma y

7-Ma y8-Ma y

9-Ma y10 -M ay

11 -May12 -May

13 -May14 -May

15 -M ay16 -M ay

17 -May18 -May

19 -May20 -M ay

21 -M ay22 -M ay

23 -May24 -May

25 -May26 -M ay

27 -M ay28 -May

29 -May30 -May

31 -May

DAYS

SAl

es

0

2000

4000

6000

8000

10000

12000

Foot

fall

Series2Series1

Sales Vs Footfall

0200000400000600000800000

100000012000001400000

1 2 3 4 5

Months

Rupe

es

0

1000

2000

3000

4000

5000

6000

Foot

fall

Sales Footfall

The sales and the footfall depends upon two factors i.e. out-store marketing and in-store

marketing. Out-store marketing is more to related with hoardings and television

advertisements. This all helps in attracting the customers and more of creating awareness about

the various schemes available in the store. Whereas in-store marketing deals with visual

merchandising and attractive offers to lure the customers and providing “Value for Money”

to the customers. It also includes the selling capabilities of the sales team, who constitute the

most important part of the store.

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A good promotion by the marketing department, effective merchandising and a good service

level makes the existing customers buy from our store or resulting in favorable word of

mouth publicity, which helps in attracting new customers.

Average Number of Bills (Transactions) per day

This figure indicates the actual number of customer in proportion to the footfall. Higher the

number of bill vis-a-vi the number of walk-ins is an indicator of the efficiency of the store in

terms of product availability, customer service and merchandising. The focus area here is in-

store marketing as it involves making sure about the availability of wide range of products,

attractive displays, value for money offers and customer service.

Conversions

A measure of how many of our walk ins are actually buying something. Conversion is a result

of combined efforts of merchandise, in store displays and marketing and selling skills of the

staff.

Calculation Conversion Ratios

We know how many people make a purchase, what we don’t know is how many people don’t!

Integrate our sales data with footfall to get a detailed picture of the conversion ratios in our

store and calculate our missed opportunities.

Months Weekdays conversion Saturday Conversion Sunday Conversion

Jan 60 54 54

Feb 67 65 60

Mar 67 70 58

Apr 62 68 59

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Conversions

0102030405060708090

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31

Days

Con

vers

ion

Rat

e

Conversion rate

Comments:

• Average conversion rate has fallen in the month of April on all the days of the week.

• The average conversion rate is higher on the weekdays as compared to the weekends as

there are more serious buyers in the weekdays, which is quite understandable.

• The conversion rate for the coming month’s shows decreasing trends due to summers.

Weekdays Conversion

56586062646668

Jan Feb Mar Apr

Conversion

Saturdays Conversion

0

20

40

60

80

Jan Feb Mar Apr

Conversion

Sundays Conversion

50525456586062

Jan Feb Mar Apr

Conversion

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Ticket Size

Ticket size is the average amount of money each buyer spent in the store in one visit. Higher

ticket size indicates a good assortment and variety of merchandise in the store. The availability

of right merchandise is the main thing. Therefore display, promotion and selling skills will

ensure a higher ticket size.

Months Weekdays Ticket Size Saturday Ticket size Sunday Ticket Size

Jan 472 635 538

Feb 445 529 572

Mar 434 574 614

Apr 505 612 679

380400420440460480500520

Jan Feb March April

Weekdays ticket size

JanFebMarchApril

0

200

400

600

800

Jan Feb March April

Saturdays ticket size

JanFebMarchApril

Page 29: Analysis on Big Bazaar retail outlet (Koramangla)

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0

200

400

600

800

Jan Feb March April

Sundays ticket size

JanFebMarchApril

Comments:

• Average ticket size has increased in April by 10% on the weekdays, 6 % on Saturdays

and 14.69% on Sundays over the previous 4 months

• Price challenges and attractive offers were the reason for the increasing ticket size in

the month of April

• Aggressive marketing of Big Day in the local newspaper as well as distribution of

leaflets in the local areas

Average Sales per square feet

Sales per square foot are a very important retail performance benchmarking ratio. It is the sales

revenue generated per square foot of Retail space.

It is calculated as:

Sales per Sq feet = Gross sales/ retail space sq. ft.

Since cost of Retail space is a significant cost element in the retail business, this ratio is

instrumental in gauging the store sales performance.

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Months Weekdays sales per square feet

Saturday sales per square feet

Sunday sales per square feet

Jan 6361 11793 10860

Feb 3861 6829 10767

Mar 3605 7230 11168

Apr 5728 10686 15870

0

2000

4000

6000

8000

Jan Feb March April

Weekdays Sales per Square feet

JanFebMarchApril

02000400060008000

1000012000

Jan Feb March April

Saturdays Sales per Square feet

JanFebMarchApril

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0

5000

10000

15000

20000

Jan Feb March April

Sundays Sales per Square feet

JanFebMarchApril

Comments:

• Average sales per square feet has increased in the month of April by 22% in the

weekdays and Saturdays and there has been a jump of 35% on Sundays

• This indicates the efficient utilization of the selling space and increasing sales due

to earlier stated reasons

• The average sales per square feet follow a ratio trend of 1:2:3 in

weekdays : Saturdays :Sunday Average piece per bill Average piece is the amount of pieces sold to a particular customer. This parameter helps to track the inventory turnover of the products in the store. Higher the number of pieces per bill, higher will be the ticket size and the sales of the store. For example Buy 1 soap for Rs 10/- And if an offer is there which says Buy 3 soaps for Rs. 25/- The customers will go for that offer and thus the ticket size and sales increases. Average value per piece Average value per piece means the average value of each piece in the particular bill. We get this figure by dividing the total bill amount by number of units in the bill.

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IMPLICATIONS OF STUDY

Footfall optimization

• Aggressive outdoor marketing at the local level specially in Kormangla as awareness is

very low among the people in some areas of the city

• Leaflet distribution on regular basis in the local newspaper Kormangla

• Our Big Bazaar in-store brands needs awareness thus should be marketed well and a

well known brand ambassador such as Shahid kapoor and his father Pankaj kapoor

for apparels and footwear to attract the customers

• Quality of the products should be improved so that it is value for money not just

cheap products

• Emphasis should be laid customer service and customer satisfaction

• Easy and fast billing facility can increase the ticket size as well as the footfalls

• Electronic display board outside the store can help in increasing the footfalls

• Attractive displays, good assortment and wide range of products in every category

helps in increasing footfalls

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Conversion rate optimization

Conversion will result due to the combined effect of merchandise, in store display and

marketing and selling skills of sales staff. In case of a mall opening mall adjacent to our store,

large part of customer entry could be the customers just hang out, thus the selling skills of the

staff and in store display and promotions will play most important part in conversion.

* Putting the description of the product along with the product price of home

solution products

INCLINATION NO INCLINATION

NEED Conversion will happen

To ensure conversion:

• Good assortment

• Good service level

• Selling skills of the staff

• Good In store promotions

• Make them spend more time

In the store

Will have to work hard on

conversion

They have perhaps just come to see the

store and not make any purchase.

To ensure conversion:

• Display and In store promotion

• Personalized service

• Convincing skill of the staff

comes into play

WITHOUT

NEED

Can be converted easily

To ensure conversion:

• In store promotion of impulse items

• Selling skill of the staff

• Attractive product display

Most difficult to convert

To ensure conversion:

• Promotion should be very

tempting

• Conversion might not happen in

this visit but a seed of need is sown

in their mind

• Good Assortment, variety and

displays

• Aisle route to ensure visibility

to a large number of categories

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Study of Impulse buying behavior to increase the ticket size

Impulse buying goods

Impulse goods: Impulse purchases are goods or services that are acquired in a spontaneous or

an unplanned manner without any prior thought. These kinds of purchases can only be

encouraged through the help of aggressive marketing techniques that are adopted by a

business. Once have found out what your customers want and how to reel them in, it becomes

very easy to encourage impulse purchases.

• Consumer research shows that we’re vulnerable to subtle (and even not-so-subtle)

marketing techniques — impulse buying accounts for a significant proportion of

supermarket purchases.

Strategic inputs to increase the Business

Positioning of the goods: More expensive items tend to be right in the line of sight of the

target consumer. Cheaper or supermarket own-brands tend to be located on the higher or lower

shelves.

Concept behind: Separation of popular staples is a common element of supermarket design.

So that customers spend more time in the store negotiating the way past all those flashy and

tempting impulse-buy items.

Discounts offered: Heavily discounted and advertised goods that are designed to get customer

into the store. The idea is that customers pick up a few more items while they are there.

Combinations: Positioning ‘natural’ combinations like chips with dips or biscuits near tea and

coffee may seem logical.

Temptation: Magazines and confectionery live here. They succumbed to the temptation and

nagged into buying by kids.

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• FOOD retail outlets should position impulse products at the entrance as a customer is

making impulse buying decisions in the first 15 seconds of entering a supermarket or a

retail outlet, a study has revealed.

• Big packets should be kept at eye level and smaller packets at a lower level. "This is

because, people will first pick up products at eye level as against bending down and

picking up a product

• The placement of goods should follow the progress of the day starting with products

that are used in the morning, followed by breakfast items, morning health foods,

toiletries, food grains, pulses and utility items ending with the gifting section.

• There should be a person from the house keeping department kept at the entrance doors

so that the person who is not actually a customer ends up purchasing something.

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Researchers Opinion

At the Food and Brand Lab, University of Illinois, researchers found that promotions using

multi-unit pricing (for example, three for $3), purchase suggestions (‘stock up for upcoming

Festival’) or with purchase limits (‘limit three per customer’) increased the amount

consumers purchased. “All three types of promotion increase purchase amounts by 30% to

105% over what consumers would normally plan on buying,” it said.

Other research showed that more than 50% of shoppers couldn’t resist a ‘buy-one-get-one-

free’ promotion. But did you even need one in the first place, never mind two?

According to a survey the following things we found out:

Do you use a shopping list for today’s shopping?

• Yes, I have planned everything or nearly everything: 38% (Segment 1)

• Yes, partly and in addition I buy what comes to my mind

When I am in the store: 40% (Segment 2)

• No, I do not plan in advance –I buy what comes to my mind

When I am in the store: 20% (Segment 3)

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Customers are not targets!!! “Customers are probably a firm’s most valuable asset and they should be

nurtured, developed and treated accordingly. Each n every customer should be

the objective of proactive bonding relationship”

• There should be continuous interaction with the customers to get inputs and

feedback

• Action should be taken on the customer complaints till the point they are

reasonable

• Customer satisfaction level should be checked at proper time intervals

A customer’s perception of the product and benefits accrued is the main motivating factor

for his decision to buy and the money that he is willing to pay for it. Lets look at the

CARE concept of customer service.

C- Creative Communication

A-Atmospherics and appreciation for all

R- Responsiveness and respect for being

E- Empathy and enthusiasm

Creative communication plays a pivotal role in brining about this and is an inseparable

adjunct towards building a strong and successful retail brand. It must bring excitement

into the customer’s life – excitements that bring to the fore their latent needs and makes

them feel respected and “larger than life”.

Retailers need to understand that things such as customer loyalty and excitement are the

key to success. They must learn to value people- the customers- in new ways to allow

them to connect their dreams and desires with what they do and what they buy. Emphasis

the deeper, broader purpose of each person. Stimulate pride and excitement through the

ways they facilitate decision making during buying process. Promote a spirit of one-ship

or pride in belonging to an elite peer group or a unique clientele- a family of valued

customers.

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Comparative Study with Other Store

Comparative study is a tool that is been used by the stores to know themselves and the

parameters on which they are performing well and on which they have to work on. This

study helps the organization to improve their efficiency and sharp their competitive edge

over their competitors.

Parameters Big Bazaar/

Food Bazaar

Shoprite D mart TruMart Hypercity Spar

1) Sales Staff

a) Grooming 3 3 2 4 5 4

b) Knowledge 4 3 3 3 4 4

c) Behavior 4 2 4 3 4 4

2) Security Staff

a) Greetings 4 3 2 3 3 2

b) Handling of

baggage

5 3 4 3 3 2

2) Ambience

a) lighting 4 3 4 3 5 4

b) room freshness 2 3 4 4 3 4

c) movement space 4 3 2 3 5 3

d) Music 3 3 4 2 3 3

e) Entrance 4 3 3 3 3 3

3) In store

Merchandising

a) Placing of

Mannequins

3 - - - 4 -

b) Stacking 3 4 4 5 5 4

c) Placing of Ads 3 4 4 5 5 5

d) New schemes 4 3 3 3 4 3

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e)Branded Display 3 4 4 4 3 4

f) Own Brands

Display

4 3 2 3 5 3

4) Amenities

a) Trial rooms 5 - - - 4 -

b)Elevators/Lifts/stairs 3 4 4 4 5 3

c) Toilets 1 3 4 2 5 4

d) Drinking Water 2 3 3 3 4 3

Customer satisfaction is the key to success in the retail industry. Therefore to check the

customer satisfaction level and the small survey was conducted. According to the survey

conducted with a sample size of 40 respondents as well as the observations made during

the visits to the different malls and stores across Mumbai city the following results came

out:

Analysis:

1. Sales staff needs a bit of grooming.

2. Room fresher spray should be done in the store in order to create a pleasant

shopping environment.

3. Space for movement of the customers is fine except the movement in the food

bazaar.

4. Mannequin displays are appropriate.

5. Improper stock stacking is an issue.

6. Inventory movement is also one of the issues especially in the rush hours.

7. Displays of the electronic goods are not attractive and tidy.

8. Lack of proper toilets and drinking water facility.

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Conclusion

Ideas that can work for the store

Proposal 1

Sell the Air time

The store can earn income by selling the store’s announcement and music Air times for

playing the jingles of the products kept at the store and in turn earn advertisement money

from the companies as they spend heavily on advertisement and in this way we can get a

bit of their advertisement budget. We can charge different charged on different days of

the week and even different hours of the day. This will act as a revenue generation for

the store and that revenue can be used for out door marketing of the store. It is also a win

win situation for the store as the ticket size and sales will increase as it will lead to

impulse buying as well as need felt buying by the customer.

For Example, Jingle of Surf Excel, soft drinks etc.

NOTE: We will not play the jingles the whole day, instead we will keep a restriction of

total 15 minutes of these jingles per day so that the announcements are not hindered.

Proposal 2

Ration Day

This is one of the concepts that we can use it to get associated with our store. This

concept can be applied to 1st Saturday of every month. On this day we can bring

down our margins and concentrate on our top line (i.e. Sale Volumes). This will

act as a brand building exercise for the concept life Big Bazaar and people will

associate Ration day with Big Bazaar.

Proposal 3

Special offer

The concept of special offer should be used in a tactical way. The announcements

should be made of the special offers on the weekends in advance during the

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weekdays and the special days such as BIG DAY should be publicized a month

before and there should be teasers regarding this.

Proposal 4

Display screen It is said that the visual displays have more impact as compared to any other medium of

information. The store can use electronic display screen, displaying the running offers

and the venue for those offer. So that the customer is aware of all the offers running in

the store and it is convenient for them to locate the place of the offer as Kormangla Big

Bazaar has two floors.

Proposal 5

Optimizing the offer price Testing of various price points to maximize conversion rate and total profits. It’s

generally better to start high and reduce your price in subsequent testing to find the level

of maximum profit.

Proposal 6

Phone a friend This is a very old concept but what we can differentiate is by keeping a fixed category of

products in a particular package. For example:

Package Name: Ration Starters (RS)

Products:

1. 5 Kg Wheat

2. 3 kg sugar 3. 3 kg Rice 4. 250 gm tea 5. 1 toothpaste 6. 5 soaps

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7. 1 shampoo

The total of the above will exceed Rs. 500 which will be a considerable amount of

business for the store. The customer can order this package and along with that the other

needs of his on the phone itself and the delivery will be made the next day and cash can

be collected. A separate telephone line is required and a person in charge for it should

also be there to take orders and take care of the delivery. The phone orders should be

taken between the non peak hours from 10 am to 3 pm. Attractive offer

Apparels

(a.) Buy 2 shirts worth Rs. 449/- each

And

Get 1 trouser free worth Rs. 449/-

(b.) Complete Wardrobe (MEN)

1. Formal shirt- Rs. 349/-

2. Trouser - Rs. 499/-

3. Leather Belt- Rs. 199/-

4. Tie - Rs. 149/-

Total = Rs. 1196

BB Price = Rs. 999/-

(c.) Concept of Friday Fashions at the store giving special emphasis on

apparels.

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Some important Conclusions of the research is:

• Big Bazar has a very good brand Value in the market.

• The Big Bazar staff is considered as a top most groomed staff of the

Indian retail businee.

• Big Bazar has to update itself according to the new upcoming Retail

outlets.

• It caters a wide range of consumer from the wide range of segments.

• It has experienced the maximum industry footfall in his outlets.

• It has widest range of products to offer.

• It has a wider acceptability all over India in comparison to other

stores.

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BIBLIOGRAPHY TEXT

Daily sales report (DSR)

Articles from RetailBiz

Statistics for management by Levin Rubin

www.retailacademy.com

http://www.lawson.co.jp/company/e/ir/library/presentation/2005/ps_2005_e/html/17.html

www.bigbazar.org

www.indiaretailbiz.com

www.retail.edu