CHAPTER – 2

LITERATURE REVIEW, RESEARCH DESIGN AND METHODOLOGY

LITERATURE REVIEW
Retail supply chain is a contemporary and evolving field which is a
culmination of two different areas of management, namely, supply chain
management and retailing. Even though there are many refereed papers in the
area of supply chain management and retailing, there are not many research
papers/articles in the area of retail supply chain, especially food retail. Moreover,
most often the research papers cover a specific topic such as the relevance of
Radio Frequency Identification (RFID) systems in food supply chain, customer
behaviour in a food and grocery etc.

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

importance of late only. And scouring for research papers in the area of food retail
supply chain with reference to Indian context is a herculean task. In spite of the
paucity of literature in the specific field, a humble attempt is made to unearth the
research papers/articles relevant to the research study.

Retail Supply Chain

The study by Bourlakis, Michael and Bourlakis, Constantine (2006)32
focussed on the integration process of retailer’s information technology strategy
with logistics strategy and to find out those aspects of the retailer’s distribution and
operational performance that are mostly influenced via that integration.

The findings show that logistics and information technology strategies are
developed and implemented in a parallel way by both local and multinational food
retailers. A financial ratio analysis carried out for these firms suggests that
multinational firms possess greater operational efficiency at both secondary and in-

32
Bourlakis, Michael and Bourlakis, Constantine (2006), “Integrating logistics and
information technology strategies for sustainable competitive advantage”, Journal of
Enterprise Information Management, Vol. 19 No. 4, pp. 389-402.
31
store distribution operations compared to domestic firms. This is largely attributed
to the integration of logistics and information technology operations. Multinational
firms superior operational efficiency also contributes for a higher profitability
performance.

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

supply chain management in his paper. He discussed a number of changes that
are taking place in modern retail supply chain in direct response to the changing
demands of consumers. He also explained how these changes prompt a number of
implications for the management of the retail supply chains.

That logistics is an important component of modern supply chain

management needs no emphasis. Logistics may be external or internal to the retail
outlets. Kotzab (2005)34 shows the importance of logistics in (instore) an outlet.

Through his empirical study, Kotzab proves the importance of instore

logistics as a key determinant on the success of retail business. In the model, he
has included the logistics processes that are carried out within a retail outlet
ranging from incoming dock to the checkout as the in-store logistics.

As part of the study, Kotzab interviewed 202 store managers from three
different kinds of stores namely supermarkets, small hypermarkets and large
hypermarkets.

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

improving logistics and distribution supply chains of the food retail industry. The
paper explains the concepts of logistics and supply chain as well as the new

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

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

32
challenges in the food industry. The paper also discusses the successes and
failures of the industry. The results reveal slow progress in accomplishing the goals
of leaner supply chains and easier distribution. The study discusses how consumer
driven, time-phased planning provides solutions to these challenges such as
including the consumer in the supply chain planning process, managing product life
cycles, promotional planning, planning for seasonal products, integrating with
category management, determining cost-effective supply channels and planning
capacities at the store level.36

Shopping behaviour
Shopping behaviour is an important phenomenon. The next two papers
discuss the shopping behaviour of the consumers.

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

and also when they exhaust requirements (emergency purchases). In his research
paper, Nordfalt, Jens (2009)37 views shopping trip as either a (more or less)
contingency-dependent construction or as the execution of a well-defined
behaviour and proves that larger (major) trips are more well defined, whereas
smaller (fill-in) trips are found to be largely contingency dependent constructions.

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

behaviour based on the assumption that households seek to minimize the travel
cost associated with shopping and the cost of holding goods in inventory. They
prove a point that the relationship between household characteristics and shopping
behaviour can be fairly complex – for some households shopping may have a
recreational aspect while for others it may compete directly with wage-earning
activity.

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

33
Private Labels
When customers buy their requirements they buy both branded as well as
private labels. The first paper presents the growth of private labels in different
countries and the factors influencing the growth of private labels. The second
paper tries to distinguish international, national or regional private brands. The
paper gives an account of the national brands and the private labels. The third
paper gives a new dimension to the customer’s buying behaviour of private labels.

The growth of private labels is enormous over the past few years in many
countries and in particular, countries such as Germany, Belgium, the UK, Austria
and Spain. The private labels amount to nearly 40% in these countries. Retailers
resort to produce their own private labels because of high margins, to outsmart the
national brands, to gain control over shelf space, to introduce lower prices to
consumers by controlling the costs and to gain bargaining power with
manufacturers etc. (Altintas et al, 2010).39

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

private label brands enjoy growing popularity and are increasing in both their
quantity and quality, they continue to attract the attention of scholars and
practitioners. One major shortcoming of previous research is that it focuses on
price as the dominant driver of buying intentions. The findings of the study reveal
that brand consciousness and attitude instead play a role on the intention to buy
private label brands.

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

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

34
labels on most dimensions of customer perceptions and the study finds very little
difference in consumers’ price perceptions between national brands and
international private labels. However, in the case of convenience goods,
international private labels are found superior in quality compared to local private
labels and consumers are willing to pay more for the former. At the same time, with
respect to shopping goods even though they find the international private labels
are superior in quality than the local private labels, they are not willing to pay more
for the same.

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

stock-out on the behaviour of the customers in buying. He studied the effect of
stock-out on buying behaviour of the customers, and found that the age, family size
and the kind of customers determine whether the customer goes for variant of the
same brand or prefers a different brand or obsessive enough to go for the same
brand in another outlet. Also, the paper suggests the strategies for the retailers to
be followed to overcome the situation such variances in customer preferences.

Customers habits are changing. While the customers by and large make
purchases by visiting the retail chain, some also buy online. The following paper
lists the parameters that influence online customers.

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

(2000).43 The study found that the online users are of age less than 55 years.
Convenience and time saving are the most important factors influencing them to go
for online purchase. Some attributed the physical inability or physical constraints as
the reasons to go for shopping online.

Supply Chain Efficiency

Supply chain management holds the key for success in modern retailing. As
such, it is appropriate to know how the supply chain affects the retailers. The

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

35
following two papers bring forth the efficiency of supply chain in enhancing the
store image.

Avirat Sonpal (2006)44 states that retail supply chain efficiency is all about
learning what the customer needs and then actively working to fulfil those needs
through sourcing, merchandising and product development mechanisms. The
author enumerates the benefits of effective supply chain management in retailing.

Steckel (2004)45 using simulation models shows how the changes in the
order and delivery cycles, availability of shared Point-of-sale (PoS) information and
the pattern of customer demand affect the supply chain efficiency. The paper is
based on “beer game” simulation. He proves that speeding up of the cycle time is
always beneficial. But at the same time, the benefits of sharing of PoS information
depend on the nature of demand pattern.

Gibson, Brain et al (2009)46 observe that the retailers are more reliant than
ever on supply chain management for organizational success. The focus of SCM is
to cut down inventory levels while maintaining high in-stock availability, reducing
transportation expenses in the context of fuel price volatility. Efforts are well under
way to link SC strategies to organizational plans. The best performing retailers
have developed a culture in which the majority of employees share a core belief in
the mission of the organization, and are committed to helping the organization
achieve that mission. These retailers have developed formal training programs to
suit the needs of rank and file employees, along with the managers.

The importance of supply chain inventory management technique Vendor

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

44
Avirat Sonpal (2006), “A Valuable System – Different aspects of managing the supply
chain in retail”, Retail Biz, December, pp. 37-38.

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

36
VMI is one of the most widely discussed partnering initiatives for improving multi-
firm supply chain efficiency. The research article showcases the effect of VMI on
improved service and reduced cost in an organisation.47

Using New Jersey as a case study, this paper investigates the challenges
faced by food retail stores. Policy recommendations proposed by industry
representatives for improving the business climate are also presented. Although
the case is New Jersey specific, many of the issues discussed in the paper may be
relevant elsewhere. The findings can be helpful in identifying broad categories of
factors affecting the vitality of the industry and in designing investigative research
into problems facing the food retail industry (Adelaja, A.O, 1999). 48

Store Attributes
Reutterer, Thomas and Teller, Christopher (2009)49 paper identifies store
format attributes that impact the store format choice when consumers conduct fill-in
or major trips to buy groceries. By doing so, the authors take into consideration that
consumers patronise multiple (store based) formats depending on the shopping
situation operationalised by the type of shopping trip. The results reveal a
considerable moderating effect of the shopping situation on the relationship
between perceived store format attributes and store format choice. Consumers’
preference is significantly higher for discount stores and hypermarkets when
conducting major trips. In contrast, supermarkets are preferred for fill-in trips in the
focussed retail market. Merchandise-related attributes of store formats have a
higher impact on the utility formation regarding major-trips, whereas service- and
convenience-related attributes do so with regard to fill-in trips.

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

The following three papers give an account of linkages between economic

growth and consumer spending pattern, the retail distribution network and the
changing Indian retail sector.

Srivastava (2009),50 in his research brings forth the retail scene in India. He
has extensively used the reports of Mckinsey, HSBC, Technopak, CII and others to
capture the growth of organised retail and shopping malls in India. Also, he gives
an account of the different organised formats promoted by the Indian business
houses. He finds that the malls are more developed in Northern and Eastern part of
India. Malls are becoming centre for outings for the families and they spend about
1-3 hours in malls. Food, groceries and apparel purchases by customers
contributed to 52 per cent of these organised retail formats in 2006. Srivastava
further elaborated on the time spent by the customers in the malls and how the
food courts, play places, etc in the malls are becoming the attractions for family
outings. According to him, the small retailers in order to compete and to retain their
customers offer better service by means of credit and home services.

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

established in Bangalore in 1971. The emergence of modern retail business in
India has a history spanning over 30 years. The paper is on food and grocery retail,
biggest in India and the author tries to detail the drivers of revolution and growth
focusing on the role of manufacturers, retailers and consumers.

Chetan Ahya (2006)52 argues that the rising scale of organized retail
distribution network and increasing competition will force players to focus on
restructuring the whole supply chain to improve productivity and to provide a better
deal to the customers.

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

38
 He is critical of the organized retail chains ability to offer customers the right
price for staple vegetables during the crisis situation because of disorganized
supply chain. He concludes that unavailability of cheap funds for investment in the
back-end infrastructure for aggregating the fresh produce, grading, packaging and
storing in cold storage are the primary reasons. Similarly, FICCI is also of the
opinion that the long chain of intermediaries and insufficient price-discovery
mechanisms were the reasons for high price mark-ups between farmers and
consumers. FICCI suggest farmers need to be encouraged to form farmer
cooperatives and aggregate the produce, which could be directly sold on electronic
spot exchanges or to retailers.53

Modern retail has a huge potential to not only benefit from India’s increasing
consumption demand but also create demand for value added products. Structured
employment and better life for people are the two major benefits that modern retail
is looked upon. Speeding up the modernization process is extremely vital as the
retail sector has the ability to create about 10 million additional jobs in the next five
years (2010-15). Over one million sq. feet of quality retail and entertainment space
with annual revenue of Rs. 12,00,000 crore, a whopping Rs 1,30,000 crore in
annual Value Added Tax (VAT) collection and over Rs 12,000 crore in additional
income tax revenues to the exchequer are expected to accrue in the next five
years according to Mr Amitabh Taneja, Chief Convenor, India Retail Forum 2010.54

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

services in India are at a very early stage of evolution. They have to keep pace with
the changes in demography and consumption patterns. Changes in the format
size, categories, merchandise mix or brand positioning are the need of the hour.
Accordingly, some of the established chains like The Future Group, Spencer’s
Retail etc, are in the revamp mode. They are rebranding their stores, restructuring
categories and formats to catch up with the changing landscape of modern retailing
and to cater to the emerging niches.55

53
Vishal Krishna, “Retail - Disorganised Supply Chain”, Businessworld, 31st January 2011.
54
“Expanding Business Opportunities”, The Economic Times, 14th September 2010.
55
Writankar Mukherjee and Sreeradha D. Basu, “Retailers revamp for more business”,
The Economic Times, 15th September 2010.
39
 Driven by the growth of organized retail coupled with changing consumer
habits, food retail market size in India is set to double to $150 billion (around Rs
6.7 lakh crore) by 2025. Therefore, Indian food retail sector, which is currently
estimated at $70 billion (around Rs 3.13 lakh crore) has a long way to go in the
years to come. Evolution of innovative food processing capacity, emergence of
organized retail and change in consumption patterns along with fast changing
demographics and habits are expected to fuel the next growth trajectory for the
food industry in India, according to KPMG. Though the expectations are high about
the growth prospects of the sector, it is a paradox that the growth in real terms is
crippled by the sub-optimal supply chain management largely caused by low
investments in the sector.56

In the days to come, almost all sales will be captured through Personal
Digital Assistant (PDA) or computers at the retail outlet and transmitted to the
suppliers as being done by leading companies such as Dell and Wal-Mart. This will
definitely bring down the wastages in supply chain. The logistics cost which is
currently at 12 per cent of GDP could go down by about 1 per cent as a result of
application of IT.

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

terms of information flow which used to be about 30 to 35 days in the early 1990s
has been brought down to almost one or two days in the 2010s. This was made
possible by using various hardware and software technologies and communication
links at various levels such as the mobile network, satellite communications,
personal digital assistants, automated tracking devices, vehicle tracking systems
and so on.57

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

40
Shopping behaviour
A recent research study reveals some important insight about an Indian
shopper.58 The customer: 1. keeps a brand in mind but buys the brand that gives
him value 2. is more decisive than the Chinese about the brands they want to buy
3. confidence on the shopkeeper is high 4. takes time to read the information and
to make sure that he gets what he wants. Also compares products before deciding
5. usually takes whatever the storekeeper suggests if preferred brands are not
available 6. does not look for promotions because most of the shopping is routine
7. enjoys shopping 8. likes reading the ingredients and product benefits before
buying 9. will buy a slightly pricey brand if it can give him an experience/ feeling like
no other.

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

consumers are likely to move from traditional kirana stores to large organized
retailers while shopping for groceries. Major findings show that customer
patronage to grocery stores is found to be positively related to location, helpful and
trustworthy salespeople, home shopping, cleanliness, promotional offers, quality
and negatively related to travel convenience. kiranas do well on location but poorly
on cleanliness, offers, quality, and helpful trustworthy salespeople. The converse is
true for organized retailers.

Retail Supply Chain in India

According to Rajesh Sinha,60 Chief Operating Officer (COO), Godrej
Consumer Products, focus on supply chain improvement based on a
replenishment-based model rather than a forecast-based mode enables
companies to increase sales by 20 to 30 per cent in three to six months. In two
years, a company can register a 5 per cent increase in gross margin. The

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

41
effectiveness of advertising or promotions increases with increase in supply chain
efficiency. Strategic sourcing can reduce expenses by 10 to 30 per cent.
Collaborative models with multiple suppliers are the order of the day.

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

chain in the food retail. The most important problem associated with the Indian food
industry is the inefficient supply chain as a result of which about 20 per cent of the
food produce worth Rs. 10,000 crore is wasted. Only through developing an
efficient supply chain can India’s population have access to affordable superior-
quality food produce while ensuring remunerative prices to the farmers.

The food supply chain is complex, with perishable goods and numerous
small stakeholders. In India, the infrastructure facilities connecting these
components are very weak. Each stakeholder – farmers, wholesalers, food
manufacturers and retailers work in silos. Demand forecasting, data integration,
financial flow management, supply-demand matching, collaborative forecasting,
information sharing and synchronisation of the movement of goods through
efficient transport scheduling have to find their way into the food supply chain.

Manufacturers, wholesalers, distributors and retailers can achieve tangible

benefits through innovative network and inventory optimisation. The benefits may
include enhanced demand intelligence, improved sales and services, optimised
inventory levels, increasing profitability and margins and enhanced trading partner
collaboration. Inventory management helps reduce purchasing and inventory costs;
connect inventory control, purchasing and sales order processing with demand
planning; reduce costs, improve cash flow and ensure that the right stock is
available whenever needed.62

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

harmony. The retailers have formed a rainbow coalition that will align their source
operations and share private labels, logistics, warehouses and hiring details on a

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

42
transactional payment basis. The retailers may fight on the front-end but
collaborate on the back-end – an approach that would help retailers focus their
resources on the front-end to meet the customer expectations. The move
essentially focuses on how to cut costs in supply chain and third party
manufacturing. Right now, the supply chain cost is about 12-50% across product
categories.63

India is the world’s second largest producer of fruits and vegetables. But it
loses between 30% and 40% of its fresh produce annually due to wastage along
the supply chain. India wastes more fruits and vegetables than it consumes. Gaps
such as poor infrastructure, insufficient cold-storage capacity, unavailability of cold-
storage in close proximity to farms and poor transportation infrastructure are the
contributing factors. To overcome the debilitating impact of wastage, it is crucial
that three supply chain issues are addressed. They are reduction of food miles,
development of truly world-class supplier and fixing the infrastructure.64

Sahay B.S. (2006)65 studied the current state of supply chain management
practices followed by Indian organisations in an attempt to identify the important
areas that need to be addressed in order to gain competitive advantage. The
findings reveal that most of the Indian organisations have aligned their supply
chain objectives with their business objectives. They are now on aligning their
processes and management focus. The author concludes that the enhanced level
of competitiveness would require Indian organisations to manage the three-
dimensional (supply chain objectives, supply chain processes and management
focus on supply chain activities) alignment.

For organised retail, while the last decade has been one of experimentation,
the coming decade would be that of consolidation. The retailers have been

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

43
dabbling with a variety of formats, supply chain configurations, product portfolio,
project financing, manpower planning and so on. Towards the end of the decade,
confidence level amongst the organised retailers on how to really tap the Indian
opportunity has increased. However, the key issues to be addressed remain are
battle hardened retailers, growing dominance of private labels, supply chain
innovations, enabling infrastructure and policy liberalisation.66

Increasing uncertainty of supply networks, globalization of businesses,

proliferation of product variety and shortening of product life cycles have forced
Indian organizations to look beyond the four walls for collaboration with supply
chain partners. Considering this scenario, a research study was conducted by
Sahay B.S. (2003)67 to study the supply chain practices followed by the Indian
industry. Sahay focused on the four major supply chain dimensions namely supply
chain strategy, supply chain integration, inventory management and IT. The paper
recommends that Indian industry need to align supply chain strategy with business
strategy, streamline processes for supply chain integration, form partnerships for
minimizing inventory and focus on infrastructure and technology deployment to
build an India-specific supply chain.

The following tables present in brief the studies conducted by different

agencies, consulting firms, institutions and centres of excellence on Indian retailing
and retail supply chain.

A C Nielsen on Retail and Retail Supply Chain

Title Issue Focus Area/Key Result
Global Online A Nielsen The report is based on the survey conducted
Consumer Report, between May 20 and June 7, 2011 covering more
Confidence, July 2011 than 31,000 consumers in 56 countries throughout
Concerns and Asia Pacific, Europe, Latin America, the Middle East,
Spending Africa and North America. The report shows that the
Intentions Indian consumers (with an index of 126) remained
most positive and have consistently reported the
highest consumer confidence scores since Nielsen
consumer confidence tracking began in 2005.

66
Karthik Ramamurthy and Pratik Puprediwar, “The New Level”, the strategist, Business
Standard, 14th February 2011.
67
Sahay B.S. and Ramneesh Mohan (2003), “Supply chain management practices in
Indian industry”, Distribution & Logistics Management, Vol. 33 No. 7, pp. 582-606
44
 Title Issue Focus Area/Key Result

However, the few unpleasant factors associated with

higher prices spurred by inflation, and general
economic volatility across the globe in terms of
recessionary trends are dampening the Indian
consumers spirit as well with respect to spending
and could be gauged by the slight dip in the
purchases of some of the consumer goods.

A.T. Kearney on Retail and Retail Supply Chain

Title Issue Focus Area/Key Result
The Case for Debasish The analysis suggests that organized retailers use
"Compact Mukherjee smaller formats called ‘compact hypermarkets’ which
Hypermarkets" & Hemant can tap India's significant urban retail opportunities.
in India Kalbag, A.T. Compact hypermarkets are 4,000- to 6,000-square-
Kearney, foot stores; offer the amenities of hypermarkets but
2011. are smaller and easier to navigate, and they can
compete head-to-head with the kiranas.
Indian Hemant The authors propose four guiding principles to
Retailers: Kalbag, capture top and bottom line improvements while
Improving Debasish keeping the customers happy. They are i. Take a
category Mukherjee Customer Focus ii. Define category role iii. Watch
management & Subhendu the competitors and suppliers and iv. Strengthen
Roy, A.T. operations and performance.
Kearney,
2010
Measure A.T. This study provides a blueprint for achieving an
Twice, Cut Kearney, operational excellence. This study gives a four stage
Once – 2010 framework consisting of i. Driving store value
Planning, through voice of the customer, channel strategy and
attention to store business planning ii. Delivering core store
details, and value through supply chain interfaces and store
tested operations iii. Enhancing store value through store
programs build life-cycle management, operating expense control
excellence in and store technology and finally iv. Using the
retail learning store for roll out.
operations

Unleashing Laura The article gives a detailed picture about shopper

the shopper Gurski, marketing, vision, focus, approach and philosophy. It
marketing Melanie details about the three gears namely sales-marketing
engines Schmidt et connectivity, insights-driven decision making, and in-
al, 2009 store brand activation. It aims to differentiate and
activate the consumer products in an increasingly
competitive retail environment.

45
 Title Issue Focus Area/Key Result
Retail in India: Confederati The report is divided into three parts namely: i.
Getting on of Indian Retail landscape in India, ii. Key issues in the way of
organized to Industry retail growth in India, iii. Key imperatives. The first
drive growth (CII) – A.T. part deals with the status of organised retail in India,
Kearney its growth, category wise market share in organised
Report, retail and different retail formats. The key issues
November related to the growth include underdeveloped supply
2006 chain, inadequate utilities, IT infrastructure hurdles,
inadequate real estate hurdles, inadequate human
resource, taxation hurdles, supply base hurdles,
limited consumer insights, insufficient government
incentives etc. forms the second part.
The third part covers the measures to be taken to
overcome the hurdles listed in the second part. The
concluding part details the impact of recommended
changes on the retail sector.

Ernst & Young on Retail and Retail Supply Chain

Title Issue Focus Area/Key Result

Turn risks and Olivier This report is based on the interviews with a panel of
opportunities Macard and retail sector professionals. The top 10 risks are Low-
into results – Daniel growth consumer markets, Regulation and
Exploring the Valerio, July compliance, Inability to control costs/rising input
top 10 risks 07, 2011 prices, Inability to benefit from e-commerce, Wrong
and price image, Supply chain disruptions, Inability to
opportunities penetrate emerging markets, Failure to respond to
for global shifting consumer behaviour, Sourcing and Volatility
organizations: in commercial real estate markets.
Retail sector
The top 10 opportunities are Rising emerging market
demand and rise of global middle class, New
marketing channels and social media, Competitive
differentiation via CSR and green branding,
Multichannel approach, Demographic change,
Private label, Launching new products and services,
Global urbanization, Competitive differentiation via
local branding and Enhancing efficiency in the SC.

Flavours of FICCI – According to the report, the Indian food industry is

Incredible Ernst & poised to grow by a whopping 42.5% from US$ 181
India – Young billion (Rs 8,43,460 crore) in 2009 to US$ 258 billion
Opportunities Report, (Rs 12,02,280 crore) by 2015 and by 76% to US$
in the Food October 24, 318 billion ( Rs 14,81,880 crore) by 2020, throwing
Industry 2009 up huge opportunities for investment across the
entire value chain.

46
 Title Issue Focus Area/Key Result
Growth in size of the middle to very rich class is
projected to increase at more than 300% between
2005 and 2015. During the same period the
proportion of young population (age group 15- 25) in
India is expected to grow by 11%. This will lead to an
increasing demand for food products to meet
demands of convenience, variety, health and a
changing palate.

Winning with Pinakiranjan This survey was conducted jointly by FICCI and
Intelligent Mishra, E&Y. It highlights the key drivers of retail, drivers of
Supply Chains Ernst & change in supply chain, the paradigm shift from the
Young, traditional supply chain towards adoptive and real-
December time supply network with bi-directional information
17, 2007 flow, retail supply chain challenges and mitigation
strategies.

FICCI on Retail and Retail Supply Chain

Title Issue Focus Area/Key Result
Challenges Ketan The article focuses on the following issues i.
faced by Retail Dewan, competition from local kirana stores ii. knowing and
Industry in Footfalls, understanding the target customers iii. supply chain
India June – July, management (SCM) issues such as inventory level
2010, at stores and distribution centre, demand forecasting,
Volume 4, logistics infrastructure, cold storage chains and
Issue 7 quality transportation and procurement of goods, iv.
lack of trained and skilled manpower and v.
shrinkage. Also, the article discusses strategies to
overcome these issues and challenges.

RFID Ravi Mathur This article focuses on the tracking technology RFID
Technology in and Gopal and its different standards. It also gives a detailed
Retail Supply Valecha, description about benefits of RFID in achieving
Chain Footfalls, supply chain efficiency such as increasing visibility,
February- lowering operating costs, real-time information
March 2010, processing, reducing stock-outs and increasing the
Volume 2, competitiveness.
Issue 6
Can modern Raghav This article identifies interesting things that kiranas
retail learn Gupta, do that could be adapted by modern retail for
from the Footfalls, increased business success, namely: i. Customer
humble March – Relationship Management ii. Dynamic Merchandising
kirana? April 2009. and iii. Efficient store operations.

Organised FICCI Retail This report is based on information collated from key
Retail: Report , industry players, trade associations, government
Unfinished 2007. agencies, trade publications and various industry
47
 Title Issue Focus Area/Key Result
Agenda and sources. It gives a detailed view of retail global
Challenges scenario vis-a-vis Indian retail market. It discusses
Ahead changing real estate scenario, requirement of
finances in retail, varied unfinished agenda in retail
such as simplifying tax structure, single window
clearance, FDI in retailing etc. The report covers in
detail the retail supply chain management issues in
India.

KPMG on Retail and Retail Supply Chain

Title Issue Focus Area
Sectoral KPMG This report highlights the current and future scenario of
Snippets – Report, the retail market in India. It also presents a picture of
India Industry April Indian companies’ strategic actions to cope with the
Information 2009. current economic stress. In the days to come, the
Indian retail is going to focus on value retail and food
retailing, the study reports. Also, there will be more
concentration in Tier II and Tier III cities. According to
the study, the companies will invest more in supply
chain efficiencies and emphasizes the fact that there is
a long term outlook for retail in India and this sector
continues to be attractive and there are huge prospects
for expansion.

Indian Retail: KPMG This report brings forth the impact of slowdown in
Time to Report, different parameters of Indian retail sector. Also, it
change lanes March proposes a bouquet of strategies for the retailers to
2009 cope up with recession. According to the report, the
recession has affected the footfalls, operating margin,
put pressure on the liquidity and the rentals increased
etc. It also suggests the ways to build a competent
retail supply chain management system.

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

Indian retail: KPMG According to the report, there are many drivers
on the fast Report, contributing to the unprecedented consumption boom.
track. Bridging 2006 The report enlists the fastest growing retail segments in
the capability India, organised retail as percentage of FMCG sales by
gaps. city, experimentation by ITC on rural retailing, evolution
of retail formats, growth of malls etc. It thoroughly
figures different parameters related to supply chain
48
 Title Issue Focus Area
such as supplier integration, supplier maturity, sourcing,
fragmentation of supply chain, technology adoption and
usage, private labels etc.

KSA – TECHNOPAK on Retail and Retail Supply Chain

Title Issue Focus Area
Changing Arvind The first part of the report lists down the factors
India, Singhal, contributing to a dynamic economy. The study
Changing Perspective, forecasts the consumption pattern for the year 2014.
Consumption , Volume 3, The food and grocery spending continues to be a
Changing 2010 major component and it continues to top the
Consumers categories of consumption. The consumers will shift
from ‘low-price’ platform to ‘price-plus’ platform.
There will be a strong increase in the trend of going
shopping as a ‘family’, the study opines.

Increasing Baqar Iftikar The economic slowdown has significantly increased

Private Label Naqvi and the pace of shift from national brands to private
Share in Madhulika labels or store brands among the organized retailers.
Indian Retail Tiwari, It has increased the private label sales.
Perspective,
Volume 3, This migration is not only linked to price (5-10% less
2010 than national brands), but also to various factors like
improvement in product quality, packaging,
presentation and retail experience. The study reports
that the rise of private labels is resulting in many
conflicts between retailers and brands owing to
issues like margins, display and shelf space.

India’s Food Sridhar V. & This paper details the growth prospects of India,
Vision: The Nimisha followed by key factors that have enormous
Next Chhabra, importance in increasing demand for food and are
Decade Perspective, expected to play a major role in the transformation of
Volume 4, demand drivers in the growth of food demand –
2010. rising population and incomes, increasing number of
nuclear families and working women and palate &
lifestyle changes. It also gives an account of key
issues and challenges in food industry.

India’s Veenu This article throws light on the smaller cities

Emerging Hot- Sharma, becoming nodes of attraction for the marketers. The
Spots Perspective, infrastructure developments, the changing
Volume 4, customers, the ripple effect of the metros on the
2010. cities are contributing to the growth of these cities.
These hot-spots are going to bring to the forefront
the next wave of new cities that the retailers would

49
 Title Issue Focus Area
be interested in looking at in order to gain ‘first
mover’ advantage and a foothold in the market.

Overview Raghav The first part of the research article delves into the
of India’s Gupta, impact of slowdown on consumer confidence, private
Consumer Rohit consumption and organised retail. The later part of
and Retail Bhatiani and the article finds that the EBITDA and ROC for the
Sectors Pranay retail sector is about 10-12 per cent, while for the
Gupta, FMCG sector, the numbers are higher.
Perspective,
Volume 4, The low level of returns in retail is primarily due to
2010. the high level of inefficiencies at the back end.
Inventory management which is an integral part of
any successful retail operation is currently lacking. A
significant amount of capital of an Indian retailer is
blocked in inventory leading to a strain on the
balance sheet.

The Indian Anil Rajpal This article looks at how modern retail’s landscape is
Retail and Pragya changing and what can be expected in the near
Landscape: Singh, term. It analyses how some retailers are entering the
Now and Perspective, rebuilding phase with a focus on resizing, relocating
Beyond Volume 1, and restructuring stores. It also looks at the impact of
2009. consumer product companies investing in traditional
retail, outlines the emergence of collaborative
models in retail real estate, and defines the required
focus on retail back-end, i.e. supply chain.

Supply Chain KSA – The report presents an overview of Retail Supply

Challenges in Technopak, Chain Management (SCM) in India. It discusses the
the Indian A quarterly current market size and future estimation; the factors
Retail Sector report, affecting organised retail SCM in India, compares
January and benchmarks with international retail supply
2008. chains.

The second part of the study focuses on supply

chain objectives, symptoms and pain areas, strategic
SCM areas and improvement projects for Indian
retailers

Changing KSA – The presentation is divided into four sections namely

Retail Technopak, the i. Economic update on India ii. Impact Areas iii.
Landscape in 2nd Emerging Conflicts and iv. Implications for
India: November Stakeholders. It gives an insight into the factors
Emerging 2007 influencing the growth of retail in India.
Conflicts and
Implications

50
 McKinsey on Retail and Retail Supply Chain
Title Issue Focus Area/Key Result
Building India A McKinsey This is a comprehensive report that covers the
– Report, India’s current logistics infrastructure. The report
Transforming 2007. finds it inadequate to meet the growth aspirations
the nation’s and presents a logistics infrastructure strategy. The
Logistics strategy suggested revolves around the proposal to
Infrastructure bring out a National Integrated Logistics Policy
(NILP).

Tracking the Eric D. The study reports the linkage between India’s rapid
growth of Beinhocker, economic growth and its influence on consumers.
India’s middle Dianna The author predicts that in the next two decades,
class Farrel, and India will become world’s fifth largest consumer
Adil S. economy. Consumer spending will quadruple from
Zainulbhai, about Rs 17 trillion ($372 billion) in 2005 to Rs. 70
trillion in 2025. The country’s middle class is
estimated to grow from about 5 percent of the
McKinsey population to more than 40 percent, i.e. from 318
Quarterly million in 2007 to 5,283 million in 2025. India will
No. 3, 2007 become the world’s fifth largest consumer market by
2025 from the 12th position now. India will witness
the rapid growth of its middle class – households
with disposable income from Rs. 2,00,000 to
10,00,000 a year. Food will remain the single largest
category of expenditure and growth in consumption
will accelerate from 3 per cent annually now to 4.5
per cent.

Other Report
Title Issue Focus Area
India in Report of The report gives authentic information about
Figures – A the Ministry population characteristics, economic characteristics,
ready of Statistics infrastructure, industry, energy, agriculture, social
reference, and characteristics and also that of BRICS countries.
2011 Programme
Implementat
ion,
Government
of India

51
THE RESEARCH PROBLEM

The supply chain has a key role to play in the expansion and profitability of
retailers. Retailing and logistics are concerned with product availability.68 The
retailers must be familiar and adept with the flows of product and information both
within the business and in the wider supply chain. In order to make products
available, retailers have to manage their supply chain in terms of product
movement and demand management. They need to know what is selling in the
stores, anticipate and react quickly to changes in the demand.

The fact that logistics and supply chain management play a decisive role in
modern retailing needs no emphasis. Advanced tools and techniques in the retail
supply chain have led to the improvements in the management of inventory,
distribution networks and vehicle scheduling. Retailers need the timely delivery of
merchandise if they are to satisfy and retain the customers. To quote Newman, If
it’s not in store, you can’t show it! If you can’t show it, you can’t sell it! (Andrew J
Newman, 2007).69 The most significant challenge that impedes the development of
an efficient and modern retail sector is an underdeveloped supply chain.

NEED FOR THE STUDY

The underdeveloped, traditional, and unidirectional supply chain increases
inventory build-up coupled with operational inefficiencies for companies (Business
Line: April 24, 2008).70The spurt in the organised retail business in terms of the
number of retail chains across the country testifies the growing acceptance of the
modern retail format and the shift in the customer preferences from the traditional
kirana stores to huge retail outlets which have made shopping a pleasant
experience. The earlier reluctance to visit the small typical grocery store is replaced
by new enthusiasm and excitement on the part of the 21st century consumers. The
new realities and changing dynamics of the retail trade prompted the researcher to

68
John Fernie & Leigh Sparks, Logistics and Retail Management, Kogan Page, London
and Sterling VA, 2004.
69
Andrew J Newman and Peter Cullen, Retailing: Environment & Operations, Thomson
Learning, 2007.
70
D. Murali and Kumar Shankar Roy, Biggest Challenge for retail is ‘underdeveloped
supply chain’, Business Line, April 24, 2008.
52
examine in detail how issues related to supply chain – the critical success factor in
the F&G retail format – are addressed. Hence the research topic “Retail Supply
Chain Management in Food and Grocery (A case study of Bangalore City)”.

OBJECTIVES OF THE STUDY

– To examine the management of logistics and cross-functional drivers of the
Food and Grocery (F&G) retail outlets;
– To study the management of supply chain processes like the Customer
Relationship Management (CRM), Internal Supply Chain Management
(ISCM) and Supplier Relationship Management (SRM);
– To assess the degree of competition among the food and grocery (F&G)
retail outlets;
– To determine the performance of the Food and Grocery (F&G) retail outlets
using different metrics, and
– To suggest ways and means to improve the supply chain management
practices of Food & Grocery (F&G) outlets.

TESTING OF HYPOTHESIS

H 1: The time and the amount of purchase made by different customer groups
(family, friends and individuals) are different.
H 2: Mean of the percentage of sales over different periods of a month
(namely 1st -10th, 11th – 20th and 21st – 30th) are same.
H 3: The number of footfalls at an organised retail outlet is independent of the
location of the outlets
H 4: The number of footfalls at an organised retail outlet is independent of the
size of the outlets
H 5: Number of customers for an outlet depends on catchment area.
H 6: Number of customers is independent of the size of the organised retail
outlets.
H 7: Competition has affected the sales of organised retail outlets.

H 8: Distribution of the sales per square foot of organised retail outlets and the
kirana stores are different.

53
 H 9: Distribution of monthly sales of organised retail outlets and the kirana
stores are different.
H 10: Distribution of sales per employee of organised retail outlets and the
kirana stores are different.

SCOPE OF THE STUDY

Retailing in India is gaining momentum over the years. The city such as
Bangalore has great potential for organized food retail. The research study
examines the logistics and cross-functional drivers of supply chain in detail as
practised by the organised retail outlets in Bangalore. Towards that the study
identifies the areas where the outlets are doing better and also enlists the areas
where they have to improve upon. This gives the scope for the operators/owners of
the outlets for enhancing the customer service, product availability, etc.

It also helps the managements of the retail outlets devise appropriate supply
chain strategies to achieve competitive strategic objectives. For planners, the study
gives the insights which will enable them to frame policies, procedures and
schemes to create a congenial environment and impetus for further growth of food
retail in Bangalore.

LIMITATIONS OF THE STUDY

In spite of the efforts undertaken by the scholar, given the vastness and spread
of the city of Bangalore and at times coupled with the reluctance of the
respondents to divulge information wholeheartedly, the researcher has confronted
with certain limitations in the field work. Therefore, like any other project of this
magnitude, the present research study is also not free from some limitations.

– The focal point of the study is to examine the six supply chain drivers of the
food and grocery outlets/stores in Bangalore City. Therefore, inferences
drawn from the study will have limitation of generalisation of findings.

– The data analysis, interpretation and inferences are based on the data
collected from the managers, operators and employees of the
outlets/stores. Their perceptions may have personal bias and subjective
view points.
54
 – Food and Grocery outlets operate in a dynamic environment. The
observations and inferences drawn out of the study pertain to the particular
period of time. This would have changed or may change over a period of
time.

RESEARCH METHODOLOGY
The Food and Grocery (F&G) retail segment in India is unique. F&G can be
broadly categorised into organised and unorganised retail. The organised retail can
be further categorised into corporate retail chains and individual standalone retail
outlets. For the purpose of the study, the researcher has considered all the three
segments namely, corporate retail chains, standalone retail outlets and kirana
stores.
Also, an attempt is made to ascertain the practices adopted by unorganised
sector (kirana stores) in comparison with organised sector with respect to the
adoption of modern practices.

Table 2.1: Sources of Information

Universe Retail outlets (kirana stores, corporate retail chains
and standalone retail outlets) in Bangalore.
Sampling unit Retail outlets
Sampling Technique Judgemental Sampling
Primary Sources a) Structured Questionnaire – Different sets of
questionnaires were administered on organised
outlets and unorganised kirana stores.
b) Personnel Interviews with corporate office
personnel, store managers, operators,
supervisors of organised outlets and kirana store
owners.

Secondary Sources Journals, Periodicals, Business Magazines,

Newspapers, Corporate Retail Chains’ Websites,
Retail Organisations’/Associations’ Websites,
pamphlets and catalogues.

Given the structure of the Indian retail sector (F&G) which is still in the
‘growth’ stage, it was felt appropriate to select the sample units from both
organised and unorganised sectors as shown in the Figure 2.1.

55
 Figure 2.1: Selection of Samples

DETERMINATION OF SAMPLE SIZE

Kirana Stores
An appropriate sample size has been arrived at after taking into account the
confidence level of 95%, confidence interval of 7% and the population (number of
kirana stores). The sample size determined is given in table 2.2. Thus, the sample
size of kirana stores considered for the study was 200.

Table 2.2: Determination of Sample Size (kirana stores)

Confidence Level 95%
Confidence Interval 7%
Population (No. of stores – Estimate) 2,00,000
Sample size Required 196

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

Organised Retail Outlets

As the number of organised outlets was limited, a minimum of 25 per cent of
the total number of outlets of retail chains was considered for the study. The break-
up of the number of organised outlets surveyed is given in table 2.3 and it was
150.

56
 Table 2.3: Retail Chains and Number of Outlets Surveyed
Name of the Total Number of Number of outlets Percentage of
Retail Chain outlets in Bangalore surveyed outlets surveyed
@Fresh 16 12 75
Spencer's 19 14 74
More For You 76 38 50
Nilgiris 56 14 25
Food World 48 12 25
Reliance Fresh 36 9 25
Safal Daily Fresh 32 8 25
Smart
28 7 25
Supermarket
Standalone
36
Outlets
Total 150

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

Table 2.4: Total Sample Size Surveyed*

Type Number
kirana Stores 200
Food and grocery retail outlets 150
Total 350

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

Pilot Survey

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

ascertain the validity of the questionnaire. About 15 kirana stores and 10 organised
retail outlets were covered as part of the pilot survey. The objective of the survey
was to understand from the respondents the relevance, usability, reliability etc of
the instrument. Based on the insights gained in the pilot survey, some of the
questions were rephrased, some were redesigned, re-categorised and refined.

57
Research Survey

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

has covered almost all major locations in the city of Bangalore. Though the
sampling method adopted was convenience/judgemental sampling, only one outlet
from a location is selected. This is to make sure that as many outlets as possible
may be covered from different locations and information collected is not biased or
skewed. In case of organised outlets, it was ensured that the outlet selected was in
operation for at least one year. The number of outlets of retail chains and
independent outlets where the survey was conducted are given in Table 2.5.

Table 2.5: Location of Organised Outlets

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

4. Airport Road 5. Gandhi Nagar 6. Padmanabha Nagr
7. Annapoorneshwari Nagar 8. HAL I Stage 9. Pai Layout
10. Ayanagar 11. Indira Nagar 12. Prasanth Nagar
13. Banaswadi 14. J P Nagar 15. Puttenhalli
16. Bangalore 17. Jalahalli West 18. Raja Rajeshwari Nagar
19. Bannerghatta Road 20. Jayanagar 21. Rajaji Nagar
22. Bapuji Nagar 23. Kamakshi Palya 24. Rajaji Nagar 2nd Stage
25. Basavangudi 26. Kamaraj Street 27. Ramamurthy Nagar
28. Basveswara Nagar 29. Kasba Hobil 30. RPC Layout
31. Begur Hobli 32. Kasturnagar 33. RT Nagar
34. Bhanashankari 35. Kengeri 36. Rustum Garden
37. Bhanashankari 2nd stage 38. KHB Colony 39. Sahakara Nagar
40. Bhanashankari 3rd Stage 41. Kodihalli 42. Sarajapur Road
43. Brookefield 44. KonanaKuate 45. Shivaji Nagar
46. BTM Layout 47. Koramangala 48. Sultan Palya
49. C V Raman Nagar 50. Kothanur Road 51. Teacher's Colony
52. Canara Bank Layout 53. Magadi Main Rd 54. Tippasendra
55. Chamrajpet 56. Mahalakshmi Layout 57. Uttarahalli
58. Chandra Layout 59. Malleswaram 60. Vidyarayanapuram
61. Chord Road Extension 62. Martahalli 63. Vijaya Nagar
64. Doddabanaswadi 65. Nagarbhavi 66. Vijayanagar
68. Nagarbhavi Main
67. Dommalur Layout Road 69. West Of Chord Road
70. Ejipura 71. Nandini Layout 72. White Field
73. Electronic City 74. Yelahanka

Source: Field Survey.

58
 In case of kirana stores, sample units were chosen in such a way that they
represent different location in the city of Bangalore.

The number of outlets surveyed and their year of establishment are given in
the Table 2.6 and Figure 2.2. The concept of organised retail is very new in India.
In the country, the growth of organised retail gained momentum in 2003-04. The
sample of the outlets collected also replicates the same. That is, the number of
outlets opened over the years has increased and may continue to grow further in
the years to come. The survey was conducted during the year 2009.

Table 2.6: Year of Establishment of Organised Outlets

Year No. of Outlets Percentage

2000 1 1
2001 1 1
2002 3 2
2003 4 3
2004 6 4
2005 12 8
2006 19 13
2007 46 31
2008 58 39
Total 150 100

Source: Field Survey.

Figure 2.2: Year of Establishment of Organised Retail Outlets

59
Reliability Analysis

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

referred to as coefficient alpha) technique. The test showed a satisfactory index of
0.6 to 0.9 which is adequate for the analysis of the data.

Data Tabulation and Analysis:

1. Microsoft Access 2007 was used for database creation and data entry
purposes.
2. Microsoft Access 2007 and Microsoft Excel 2007 were used for data
filtering, sorting and drawing charts.
3. SPSS Ver 16.0 was used for descriptive analysis, testing of hypothesis (both
parametric and non-parametric) and multivariate analysis.

CHAPTER SCHEME

Chapter 1 Introduction

Chapter 2 Literature Review, Research Design and Methodology

Chapter 3 Data Analysis

Chapter 4 Testing of Hypothesis and Model Building

Chapter 5 Summary of Findings and Conclusion

Bibliography

Annexures

60