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Logistics at Big Bazzar
Logistics at Big Bazzar
Logistics at Big Bazzar
1.INTRODUCTION TO LOGISTICS
One of the most important challenge in organized retail in
India is faced by poor supply chain and logistics
management. The importance can be understood by the
fact that the logistics management cost component in
India is as high as 7% -10% against the global average of
4% - 5% of the total retail price. Therefore, the margins in
the retail sector can be improved by 3% - 5% by just
improving the supply chain and logistics management.
In India, with demand for end-to-end logistics solutions
far outstripping supply, the logistics market for organized
retail is pegged at $50 million and is growing at 16%. It is
expected to reach $120-$130 million by 2010. Organized
retail on the other hand is growing at 400% and is
expected to reach around $30 billion by 2010.Even supply
chain and logistics firms like Hong Kong based Heng Tai
Consumables and ABS Procurement Co and ACM China
(the greenhouse specialist) is also eying the opportunity
for managing the supplies.
The supply chain management is logistics aspect of a
value delivery chain. It comprises all of the parties that
participate in the retail logistics process: Manufacturers,
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Wholesalers, and Third Party Specialists like Shippers,
Order Fulfillment House etc. and the Retailer. Here,
logistics is the total process of planning, implementing and
coordinating the physical movement of merchandise from
manufacturer to retailer to customer in the timeliest,
effective and cost efficient manner possible. Logistics
regards order processing and fulfillment, transportation,
warehousing, customer service and inventory
management as interdependent functions in the value
delivery chain. It oversees inventory management
decisions as items travel through a retail supply chain. If a
logistics system works well, the retail firm reduces stock
outs, hold down inventories and improve customer service
– all at the same time.
Logistics and Supply Chain enables an organized retailer
to move or store products more effectively. Efficient
logistics management not only prevents needless
movement of goods, vehicles transferring products back
and forth; but also frees up storage space for more
productive use.
Retail analysts say on-time order replenishments will
become even more critical once the Wal-Mart/ Bharti
combine begins operations - the American retailer works
almost entirely on cross-docking and is likely to demand
higher service levels, including potential levies for delays
in shipment.
The efficiency and effectiveness of supply chain and
logistics management can also be understood by the fact
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that modern retail stores maintain lower inventories than
traditional retail. In India, generally in the traditional kirana
stores, three weeks inventories are kept; while in a
modern retail store like Hypercity, it's nine days and it's
under two weeks for Food Bazaar. Now, it is beneficial for
both the manufacturer as well as the retailer. If we go
through the following food supply chain in India, we find
that a lot can be improved by maintaining the supply chain
and logistics.
their availability on a relatively large scale and supplying
them to customers on a relatively small scale. Retailer is a
Person or Agent or Agency or Company or Organization
who is instrumental in reaching the Goods or Merchandise
or Services to the End User or Ultimate Consumer.
Series 1
inventory
transportation
0 5 10 15 20 25 30 35 40 45 50
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Figure 1: Elements of Logistics Cost in India
Area :- Retailing
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Group’s vision to
to deliver everything , everywhere , everytime to every
Indian consumer in most profitable manner” . The group
considered ‘Indianness’ as a core value and its corporate
code is Rewrite rules , Retain values.
Strengths Weakness
Low cost Low customer loyalty
Frauds in Retail
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Opportunities Threats
Percolating down Shopping Culture
4 TITLE OF PROJECT :-
Logistics
• Logistics is the art and science of managing and
controlling the flow of goods , energy, information and
other resources like products, services and people from
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the source of production to the marketplace. marketplace.
• It’s Important to have professional logistical support
logistical
• The operating responsibility of logistics is the
geographical repositioning of raw materials, work in
process and finished inventories where required at the
lowest cost possible.
Distribution
Distribution is one of the 4 aspects of
marketing.marketing.
• Traditionally, distribution has been seen as dealing with
how to get the product or service to the customer. the
customer
• Distribution is done by distributor who is is the
middleman between the manufacturer and retailer the
manufacturer and retailer.
Supply Chain
• Supply chain, is a coordinated system of organizations,
people, activities, information and resources involved in
moving a product or service in physical or virtual manner
from supplier to customer.
• Supply chain activities transform raw materials and
components into a finished product that is delivered to the
end customer.
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Warehouses
Warehouses of big bazzar are located at Boomanahalli
and Hasketta. Suppliers of various products to
warehouses from warehouses goods supplied to internal
warehouses.
In some cases as in food items vendors directly sell to
retailers.
Quality , technology
Packaging
Labelling
Branding
Trademark
Merchandising
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Size, design , colour , features
Service
Warranty
Product line and range
Pricing policies
Credit terms
Cost and profit
Allowances and discounts
Competition
Terms of delivery
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brand proffered by the consumer is not easily available at
the convenient location.
Distribution Channels
Transportation
Warehousing and Storage
Inventory level
Positioning
Promotion mix
Advertising
Sales promotion
Personal relations
Publicity
Direct responses
5. RESEARCH OBJECTIVE
The research objective is to
o Study of Logistics and Distribution of Marketing
6. RESEARCH METHODOLOGY:
Data was collected using two approaches:
1. Observational method
Observations were made in the Big Bazaar store
regarding the customer groups present there, retail
formats adopted by the store, various verticals inside the
store for each category of product, ambience, services
provided to buyers and discount techniques
2.Survey method
Personal meeting with store manager and assistants.
Questinnare was prepared for the staffa at Big Bazaar
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which included several open-ended and close-ended
questions aimed at knowing the following:
Loyalty level
Effect of logistics
What is retailing?
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The word "Retail" originates from a French-Italian word.
Retailer-someone who cuts off or sheds a small piece
from something. Retailing is the set of activities that
markets products or services to final consumers for their
own personal or household use. It does this by organizing
their availability on a relatively large scale and supplying
them to customers on a relatively small scale. Retailer is a
Person or Agent or Agency or Company or Organization
who is instrumental in reaching the Goods or Merchandise
or Services to the End User or Ultimate Consumer.
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productivity. Though there are many opportunities to start
a new retail business retailers are facing numerous
BIG BAZAAR
FOR THE INDIAN MIDDLE CLASS FAMILY
The following graph shows the retail life cycle and we can
say that Big Bazaar is currently at the Growth Stage.
Maturity
Growth
Decline
Introduction
Time
9 OBSERVATIONS
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There were various observations made from the time I
entered the store. They can be summed up as follows:
Verticals inside the store relates to each category of
product
Food Bazaar
Depot- books
M-bazaar
Electronic Bazaar
Furniture Bazaar
Footwear Bazaar
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Sign boards are not prominent. Lack of direction creates
confusion.
Supply chain
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Warehouse
This type of supply chain is used in crockery items and
other durable goods.
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10 PROBLEMS AT BIG BAZZAR LOGISTICS.
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The storage infrastructure, too, is severely restricted. In
2006, India had a total warehousing capacity of 81 million
tonne. Like the rest of the infrastructure sector,
warehousing is highly fragmented and unorganised
Transportation, including railway systems, has to be more
efficient. Highways have to meet global standards. Airport
capacities and power supply have to be enhanced.
Warehouse facilities and timely distribution are other areas
of challenge. To fully utilize India's potential in retail sector,
these major obstacles have to be removed
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Warehouses located far from city:
Some of the warehouse are located in villages and are far
from the city so it takes time for goods to reach mall.
11 RECOMMENDATIONS
Improvement in supply chains:-
Big bazzar should use more better techniques for
improvising its supply chains. The organisational structure
and the business model of Wal-Mart are its winning-
formula for some markets. But this also dooms it to failure
in others. The heart of the matter is high-volume-low-cost
strategy, which made it a success in cost-conscious
smaller, everybody-knows-everybody cities in the US. But
this very strategy doomed it to failure in larger (anonymity,
high consumerism) cities in the US. A very high real estate
cost in big cities was also detrimental to its strategy in
such cities.
Warehouse location :-
Though it is a cost cutting formula of big bazzar, but now
the Indian scenario has changed. Though it has its own
logistics called Future logistics, it should try some other
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ways to improve its in housing of goods. Many a times it
happens that goods are not available to customers as the
time taken between ordering and processing is very long.
Improvement in packaging:-
Big Bazzar should ask suppliers to send goods with good
packaging so that losses due to breakage should be
avoided. Moreover its own handling and carrying should
be improved.
Infrastructure
Internal ware house of big bazzar has very low capacity.
Its completely hoch- poch. Due to insufficient space of
storage losses are very frequent. Shop lifting especially
internal is very high. It should allow its suppliers to have a
track of their goods so that when stock finishes they will
automatically supply.
Use of RayMedi Head Quarter
RayMedi HQ is designed to manage your chain of shops
more easily. RayMedi HQ is a web-based, easy-to-use
software which gives you more control in managing your
chain of shops. It works seamlessly with your individual
shops data (RayMedi RPOS/RE/DE data) and gives you a
consolidated and centralized way of managing your chain
bett RayMedi HQ gives you the Real-time business
status at HQ from about every point of sale. From the
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head office, you can monitor sales & inventory position at
each one of your store. The software helps you in
consolidating the data from your various branches into one
system and do an integrated analysis of sales, inventory
and purchase. RayMedi HQ primarily focuses on
managing your branch wide sales, purchase, inventory,
receivables and profits. It helps in controlling expenses,
decreasing costs and increasing your profits.
12 Conclusion
Big bazzar is having its own logistics called future logistics
but in near future to cope up with changes it have to do a
lot.The logistics companies at present provide services
from transportation to warehousing and inventory
management. But, in the near future, they will have to
expand their products basket to include new value-added
services, such as packaging, labelling and reverse
logistics.
The biggest challenge that faces these companies is that
they should quickly imbibe latest technologies, such as
GPC/GIS tracking of consignments, and uncork new
services to cater to corporates seeking to outsource their
logistics needs. Also, the Government should come out
with a sound policy that facilitates the operations of the
logistics companies.
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13 BIBLIOGRAPHY
2. Journals
(a) http://search.ebscohost.com
3. Magazines
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