Retail

Introduction
Retailing consists of the sale of goods or merchandise from a fixed location, such as a
department store, boutique or kiosk, or by mail, in small or individual lots for direct consumption by
the purchaser. Purchasers may be individuals or businesses. In commerce, a "retailer" buys goods or
products in large quantities from manufacturers or importers, either directly or through a
wholesaler, and then sells smaller quantities to the end-user. Retail establishments are often called
shops or stores. Retailers are at the end of the supply chain. Manufacturing marketers see the
process of retailing as a necessary part of their overall distribution strategy.

Shops may be on residential streets, shopping streets with few or no houses or in a shopping
mall. Online retailing, a type of electronic commerce used for business-to-consumer (B2C)
transactions and mail order, are forms of non-shop retailing. Shopping generally refers to the act of
buying products. Sometimes this is done to obtain necessities such as food and clothing; sometimes
it is done as a recreational activity.

Types
A marketplace is a location where goods and services are exchanged. The traditional market
square is a city square where traders set up stalls and buyers browse the merchandise. This kind of
market is very old, and countless such markets are still in operation around the whole world.

In some parts of the world, the retail business is still dominated by small family-run stores,
but this market is increasingly being taken over by large retail chains.

Retail is usually classified by type of products as follows:

 Food products
 Soft goods - clothing, apparel, and other fabrics.
 Hard goods ("hardline retailers") - appliances, electronics, furniture, sporting goods, etc.

There are the following types of retailers by marketing strategy:

 Supermarkets - sell mostly food products;

 Department stores - very large stores offering a huge assortment of "soft" and "hard goods";
 Discount stores - tend to offer a wide array of products and services, but they compete
mainly on price;
 General merchandise store - a hybrid between a department store and discount store;
 Warehouse store - low-cost, often high-quantity goods piled on pallets or steel shelves;
warehouse clubs charge a membership fee;
 Variety store or "dollar store" - extremely low-cost goods, with limited selection;
  Demographic - retailers that aim at one particular segment (e.g., high-end retailers focusing
on wealthy individuals).
 Online shopping websites - wide variety products could be found here at much lower prices
than on-site shops or malls.

Other types of retail store include:

 General store - a store which sells most goods needed, typically in a rural area;
 Convenience store - a small store often with extended hours, stocking everyday or roadside
items;
 Big-box stores encompass larger department, discount, general merchandise, and
warehouse stores.

Pricing
The pricing technique used by most retailers is cost-plus pricing. This involves adding a
markup amount (or percentage) to the retailer's cost. Another common technique is suggested retail
pricing. This simply involves charging the amount suggested by the manufacturer and usually printed
on the product by the manufacturer.

In Western countries, retail prices are often called psychological prices or odd prices. Often
prices are fixed and displayed on signs or labels. Alternatively, when prices are not clearly displayed,
there can be price discrimination, where the sale price is dependent upon who the customer is. For
example, a customer may have to pay more if the seller determines that he or she is willing and/or
able to. Another example would be the practice of discounting for youths or students.
 Retail in India

Retailing is one of the pillars of the economy in India and accounts for 35% of GDP. The retail
industry is divided into organised and unorganised sectors. Over 12 million outlets operate in the
country and only 4% of them being larger than 500 sq ft (46 m2) in size. Organised retailing refers to
trading activities undertaken by licensed retailers, that is, those who are registered for sales tax,
income tax, etc. These include the corporate-backed hypermarkets and retail chains, and also the
privately owned large retail businesses. Unorganised retailing, on the other hand, refers to the
traditional formats of low-cost retailing, for example, the local kirana shops, owner manned general
stores, paan/beedi shops, convenience stores, hand cart and pavement vendors, etc.

Most Indian shopping takes place in open markets and millions of independent grocery
shops called kirana. Organized retail such supermarkets accounts for just 4% of the market as of
2008. Regulations prevent most foreign investment in retailing. Moreover, over thirty regulations
such as "signboard licences" and "anti-hoarding measures" may have to be complied before a store
can open doors. There are taxes for moving goods to states, from states, and even within states.

An increasing number of people in India are turning to the services sector for employment
due to the relative low compensation offered by the traditional agriculture and manufacturing
sectors. The organized retail market is growing at 35 percent annually while growth of unorganized
retail sector is pegged at 6 percent.

The Retail Business in India is currently at the point of inflection. Rapid change with
investments to the tune of US $ 25 billion is being planned by several Indian and multinational
companies in the next 5 years. Organised retail is expected to garner about 16-18 percent of the
total retail market (US $ 65-75 billion) in the next 5 years. The enormous growth of the retail
industry has created a huge demand for real estate. Property developers are creating retail real
estate at an aggressive pace and by 2010, 300 malls are estimated to be operational in the country.

With over 1,000 hypermarkets and 3,000 supermarkets projected to come up by 2011, India
will need additional retail space of 700,000,000 sq ft (65,000,000 m2) as compared to today. Current
projections on construction point to a supply of just 200,000,000 sq ft (19,000,000 m2), leaving a gap
of 500,000,000 sq ft (46,000,000 m2) that needs to be filled, at a cost of US$15–18 billion.

According to the Icrier report, the retail business in India is estimated to grow at 13% from
$322 billion in 2006-07 to $590 billion in 2011-12. The unorganized retail sector is expected to grow
at about 10% per annum with sales expected to rise from $ 309 billion in 2006-07 to $ 496 billion in
2011-12.
 Major Retailers in India

Indian apparel retailers are increasing their brand presence overseas, particularly in
developed markets. While most have identified a gap in countries in West Asia and Africa, some
majors are also looking at the US and Europe. Arvind Brands, Madura Garments, Spykar Lifestyle and
Royal Classic Polo are busy chalking out foreign expansion plans through the distribution route and
standalone stores as well. Another denim wear brand, Spykar, which is now moving towards
becoming a casualwear lifestyle brand, has launched its store in Melbourne recently. It plans to open
three stores in London by 2008-end.

The low-intensity entry of the diversified Mahindra Group into retail is unique because it
plans to focus on lifestyle products. The Mahindra Group is the fourth large Indian business group to
enter the business of retail after Reliance Industries Ltd, the Aditya Birla Group, and Bharti
Enterprises Ltd. The other three groups are focusing either on perishables and groceries, or a range
of products, or both.

 Vivek Limited Retail Formats: Viveks, Jainsons, Viveks Service Centre, Viveks Safe
Deposit Lockers
 PGC Retail -T-Mart India, Switcher , Respect India , Grand India Bazaar ,etc.,
 REI AGRO LTD Retail-Formats:6TEN Hyper & 6TEN Super
 RPG Retail-Formats: Music World, Books & Beyond, Spencer’s Hyper, Spencer’s
Super, Daily & Fresh
 Pantaloon Retail-Formats: Big Bazaar, Food Bazaar, Pantaloons, Central, Fashion
Station, Brand Factory, Depot, aLL, E-Zone etc.
 The Tata Group-Formats: Westside, Star India Bazaar, Steeljunction, Landmark, Titan
Industries with World of Titans showrooms, Tanishq outlets, Chroma.
 K Raheja Corp Group-Formats: Shoppers Stop, Crossword, Hyper City, Inorbit Mall
 Lifestyle International-Lifestyle, Home Centre, Max, Fun City and International
Franchise brand stores.
 Pyramid Retail-Formats: Pyramid Megastore, TruMart
 Nilgiri’s-Formats: Nilgiris’ supermarket chain
 Subhiksha-Formats: Subhiksha supermarket pharmacy and telecom discount chain.
 Trinethra- Formats: Fabmall supermarket chain and Fabcity hypermarket chain
 Vishal Retail Group-Formats: Vishal Mega Mart
 BPCL-Formats: In & Out
 Reliance Retail-Formats: Reliance Fresh
 Reliance ADAG Retail-Format: Reliance World
 German Metro Cash & Carry
 Shoprite Holdings-Formats: Shoprite Hyper
 Paritala stores bazar: honey shine stores
 Aditya Birla Group - more Outlets
 Kapas- Cotton garment outlets
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Indian Retail Sector
 Challenges

The major challenges faced by Retail Industry in India are:

 Automatic approval is not allowed for foreign investment in retail.

 Regulations restricting real estate purchases, and cumbersome local laws.
 Taxation, which favours small retail businesses.
 Absence of developed supply chain and integrated IT management.
 Lack of trained work force.
 Low skill level for retailing management.
 Lack of Retailing Courses and study options
 Intrinsic complexity of retailing – rapid price changes, constant threat of product
obsolescence and low margins.