UNIT 5:

Store Layout and Space planning: Types of Layouts, Visual Merchandising Techniques, Controlling Costs
and Reducing Inventory Loss, Parking Space Problem at Retail Centres
Retail Stores & Operations Management Responsibilities of Store Manager, Store Security, Store Record and
Accounting System, Coding System, Material Handling in Stores, Logistic and Information system, Promotion,
CRM & Brand Management in retailing

STORE LAYOUT
A store layout refers to the arrangement of facilities within a store so that the movement of the visitor is not
hampered. There are many objectives behind a store layout. It aims at providing visibility to the products that
are being showcased. A store layout goes a long way towards moulding the perceptions of the consumers and
helps them to form an image of the store brand. The layout helps to attract customers and also induces them to
purchase the products that are displayed.
Types of Store Layout
Following are the four main types of store layouts for retail businesses:
1. Grid Layout: Grid layout is a conventional form of store layout, which is sometimes referred as a maze.
Under this layout, the fixtures and counters (that display and hold the products) are placed in long rows at
right angles. In between the rows there is a space which allows customers to conveniently walk and select
the product they want or like. This layout is commonly used in drugstores or supermarkets.

A grid layout is considered as the original layout for 'shopping'. It is most suitable for retail stores where
customers can shop from the entire store. Here, shoppers can follow a sequence of rows and can look around
each brand or product that they might need. Thus, it is beneficial for customers, as they get the best product.
However, this layout can sometimes become confusing and time-consuming for customers, if one only
needs to buy a specific product.
2. Loop/Race Court Layout: This type of layout is similar to a race track, which can be in form of a circle,
rectangle or square. It is a passage that starts at the entrance, loops around the store and then returns the
customer to the store front. This layout is being popularly used by many retailers for increasing their
productivity and sales.

The main advantage of the loop layout is that it provides maximum exposure to the customers by offering a
large variety of merchandise. This layout is most suitable for retail stores having numerous products,
particularly having different categories. It allows the customers to browse different sections of the store
which stimulates their impulse buying behaviour. For example, sports goods store may attract children
towards various sections representing different sport goods (tennis, cricket, swimming, golf, etc.).
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3. Free Flow/Boutique Layout: A free flow layout or a boutique layout is the simplest form of retail store
layout. In this layout, merchandise and fixtures are arranged in a freeflow pattern on the sales floor. This
pattern is usually preferable for small scale retailers having less or specific inventories.

Here, customers can freely move around the entire store, as there is no defined pattern for displaying the
merchandise. In such stores, all merchandise is of similar category or type, e.g., a fashion apparel store
which contains only tops and bottoms for men and women. However, the only drawback with this layout is
that they fail to define different departments within a store because of which customers may get confused
and frustrated.
4. Spine Layout: A spine layout is a retail store layout which consists of a single fixed passage that connects
the entrance and exit of a store. This layout consists of different departments of merchandise which are
displayed at both sides of the spine, i.e., at the front and back and also at the side walls.

5. Other Layout Types: Some other types of retail store layout are as follows:
a) Soft Aisle Layout: This layout utilises store walls for displaying merchandises, which increases the
sales of the store. When these store walls are displayed with store merchandises, they are known as
merchandised walls.
b) Minimal Floor Layout: This layout is simple and gallery-like which is used for displaying small and
limited collections of exclusive products. These products are either custom-made or handcrafted.
Usually, high-end retail stores adopt this layout, for displaying their unique collection of designer
products.
c) Combination Floor Layout: A combination layout utilises a particular characteristic of various other
floor layouts, which outfits the specific strategy of a retailer. Usually, it involves a combination of grid
layout and free-flow layout, where a grid layout is applied at the back of the store for a clearance
section, while free- flow layout is covered at the front one-third part of the retail store.

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 d) Universal Access Layout: A universal access layout refers to a store layout in which merchandises are
placed in such a way that they are universally accessible and visible by all kinds of customers including
old-age users, children, pregnant women, wheelchair users, physically-challenged users, etc. The main
motive of this layout is to provide all type of products to these users conveniently.
Steps for Designing Layout
Layout designing refers to way the facilities in the retail store are planned, so that certain objectives are
achieved. The steps involved in layout designing are as follows:
1. Selecting a Store Layout Type: The very first step in designing store layout is the selection of a suitable
store layout. Every layout will have its own set of characteristics.
2. Allocating Selling Space: The second step in store layout designing is the allocation of selling space within
the store. It involves deciding the exact location and amount of space for different merchandise categories
available within the store.
3. Locating Departments within the Stores: Once the amount of space is decided that needs to be allocated,
the next decision is to decide on the location of a department. There are two sub-decisions that are required
here. The first decision pertains to the floor on which the department has to be located and the second
decision pertains to the exact location of the department at the said floor. Typically, the ground floor has to
allocate a greater space to inventory, reducing the possibility of large selling space.
4. Organisations of Merchandise within Departments : After finalisation of the exact location on the floor,
the merchandise is arranged within the allotted space. Retailers generally use brand, price, size, style or
category, as a basis for segmenting the merchandise into different segments. The retailers give a greater
emphasis to new product lines, fashion product lines or products which are being promoted. Typically, the
product line or category which generates the maximum profit gets the best location in the department.
Importance of Store Layout
The store layout is very important in establishing the image of the store and also ensuring the efficient conduct
of the retail organisation. Following points describe the importance of store layout:
1) Improved Customer Flow: The very first importance of store layout is the improved customer flow around
the store. If the layout of the store is effectively designed, it would result in more customers visiting the
store, making large purchases, improved brand image, etc. More and more customers would visit the store if
layout of the store is appropriate displaying each and every kind of merchandise with sufficient space.
2) Improved Visibility: The visibility of best-selling merchandise reaches maximum in the presence of good
store layout. Customers are able to easily locate their desired merchandise from any corner of the store.
Directions are also simple due to hassle-free aisles in the store.
3) Enhancing the Efficiency of Store Operations: The store layout looks at integrating the front-end and
back-end operations of the store. This insures the efficiency in the operations of the retail store. It helps in
the better utilisation of inventory as well as human resources. A very good example of this may be food and
grocery stores.
4) Maximisation of Sales Revenue: One of the objectives of store layout is to give the maximum visibility to
the desired products. The customer normally purchases in a particular sequence. First, he buys staple items,
then convenience products and lastly impulse products. Generally, maximum profit margins are attached to
impulse products.
5) Prevention of Merchandise Shrinkage: Loss due to shrinkage and shop-lifting is the curse on the retail
sector. This is particularly so in low margin categories, like groceries. Shrinkage impacts the profitability of
the retail store directly. A good store layout provides no scope for such incidents as there is proper
monitoring and control of every corner of the store.
VISUAL MERCHANDISING TECHNIQUES
Visual merchandising is the practice in the retail industry of optimizing the presentation of products and
services to better highlight their features and benefits. The purpose of such visual merchandising is to attract,
engage, and motivate the customer towards making a purchase.
Visual merchandising traditionally occurs in brick-and-mortar stores using a blend of lighting, color
combinations, and articles of decor to stimulate an observer and generate interest.
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Techniques
Visual merchandising supports retail sales by creating an appealing and enticing environment for the customer
that will further maximize company growth and profit by educating the customer with strategic product
placement that will highlight and easily stretch the brand image. Detail is retail.
In order for retailers to gain an important competitive advantage in the marketplace, visual merchandising is an
important factor and an effective way of adding value to their brand. Visual merchandising communicates with
customers through elements that stimulate their senses such as lighting, music, aromas, and television screens.

The environment in which a consumer is in can influence the purchasing decisions they make. Research shows
that stores that do not communicate well with their customers, such as the retail store having a poor layout can
cause customers to incur psychic costs, and may lead to customers being deterred from shopping again as
overall shopping pleasure has been reduced. The physical environment is a primary objective in communicating
with customers in retail. Research from Thaler shows that consumers are more willing to pay a higher price for
a product if the product is purchased in a more favorable environment. This makes customers become more
accepting of the higher price, rather than if it were to be sold in an old rundown store. Customers can form an
important bias of the merchandise quality based on the retail store design environment, and even factors such as
employee’s interpersonal skills and how they are treated.

Visual merchandising builds upon or augments the retail design of a store. It is one of the final stages in setting
out a store in a way customers find attractive and appealing.
Many elements can be used by visual merchandisers in creating displays including color, lighting, space,
product information, sensory inputs (such as smell, touch, and sound), as well as technologies such as digital
displays and interactive installations.

Store design consists of mainly two techniques; interior and exterior displays, also known as in-store design and
window design. The goal of these two techniques is to attract the attention of consumers, entice them into the
store, to keep them in the store as long as possible, and influence purchasing decisions. A recent study has
found that these two techniques have the greatest effect on impulse buying; therefore, they are important aspects
for the retailer. In-store design and window display techniques can be used to enhance the store environment,
influencing consumer behaviour and purchasing decisions. In-store design is a technique, which can be used to
enhance the atmosphere of the store and the overall store environment. Having a visually appealing store design
can simulate the representation of the brand and attract customers. Efficient, customer friendly environment
makes shopping easier for consumers, which encourages buying and, most importantly, reassures repeat
purchasing. The window design technique is a way of communicating with customers, which uses a
combination of lighting, colours, props, text, and graphic design to display goods, attract the attention of the
customer, and sustain a brand image. The overall goal of the window display for the retailer is to persuade the
customer into the store and motivate purchasing.

Interior Displays
In-store visual merchandising can be used to capture the attention of consumers whilst they are in the store, an
essential component in the buying decision-making process. To capture the attention of the customer, the
retailer must consider the customer’s needs during this process. Factors that contribute to the overall in-store
design include the store layout, store design, point of purchases displays, item display, assortment display, and
signage. When applied successfully to a store, these factors can meet the needs of the consumer and provide a
positive in-store purchasing environment.

Store Layout
The layout of a store is a significant factor for the maintenance of a thriving business, which can help advance
sales and profitability. An effective store layout encourages consumers to shop the entire store and view an
extensive assortment of merchandise. The most common forms of store layouts include grid layout, racetrack
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layout and free form layout. Choosing a store layout depends on the type of store and the nature of the product
sold. A grid layout is generally organized in a rectangular shape, which allows customers to shop quickly and
maximize shop floor space, ideal for a supermarket or hardware store. A racetrack layout ensures that the
consumer only follows one path when browsing the store. This is beneficial in the sense that the consumer will
come into contact with every product on the shelf. However, this can irritate customers. Customers may feel
that they are being forced to follow a certain path, and can be frustrating when trying to make a quick purchase.
Free form layout is a suitable layout for a store that encourages browsing. This type of layout is more relaxed in
its structure, which leaves the customer feeling less rushed. The entrance of the store, otherwise known as the
transition zone, is an important area in the store. The term “transition zone” was first coined by retail
anthropologist Paco Underhill. This is an area where all shoppers pass on entry into store, and is significant as
this zone is where consumers can observe the stimuli and sense the general vibe of the store. Therefore,
thoughts and representations a consumer has about the store and the brand depend on this area. When customers
enter the transition zone they need time to adjust to the new environment including the lighting, the temperature
and other sights and sounds. Higher profit margin items aren’t recommended to be placed in that area because
customers don’t notice it while they are preoccupied with adjusting to the new environmental stimuli. Spatial
design of a retail store is a key aspect when it comes to creating an enjoyable experience, and is also an
effective way of communicating with customers. Colour can be considered one of the most important variables
when it comes to ambiance in retail. Certain colours that can be considered highly arousing can encourage
customers to make purchases out of impulse. Warm colors such and orange, red, and yellow give consumers a
sense of excitement but also provide a sense of anxiety and create a distraction. Recreational shoppers that
enjoy a sense of excitement may prefer these high arousal colors. In general, people prefer cool colours such as
green and blue and associate these colours with a sense of calmness and security. Shoppers that are more task
oriented are more likely to prefer these cool colours as they bring this calming effect and are also less likely to
distract them from the task at hand. The way the furniture such as shelves and racks and seating are set up is a
tangible element is store design. A store layout with a higher regard for space can increase customer pleasure,
and a store filled with clutter can have the opposite effect. When It comes to a simple well-spaced layout in a
store, task oriented customers find this type of layout to be the most effective, as they can easily locate the items
they want without the unnecessary clutter and obstacles in their way. These simple factors can encourage
customers to stay in the store longer and in turn spend more.

Mannequins
Mannequins are used by apparel retailers to display their products in-store and in the window display. They are
a tool used to show consumers what their products look like on a person. The mannequins will commonly be
styled to match trends as well display the latest products available. A study found that retailers projected an
ideal image to consumers with the size and proportions of the mannequins. This is used to further reinforce the
characteristics of their target market. However, consumers found the size of mannequins to be unrealistic but
would give a favorable response to the mannequins when they were headless. This was because the participants
in the study found the faces of the mannequins unrealistic and could not relate to them. Therefore, it is
important for retailers to understand the thoughts and opinions of consumers on visual stimuli such as
mannequins so they can create a more desirable shopping environment for the consumers.

Point of purchase display

Merchandise must be visible, easy to access, and there must be a range of merchandise to choose from. Having
visible merchandise is essential for retailers as consumers not only “buy what they see”. but are also able to
tangibly engage with the physical product. This creates an emotional connection, which can drive the customer
to purchase the product. The physical positioning of the product also increases visibility. Products at eye level
also get more attention. “Eye level is buy level”. Considering these elements when merchandising gives the
customer a sense of freedom of choice. “Less is more” is a key principle in visual merchandising. Although
having a wide variety of stock and product options is important for consumers, it is also important not to
overwhelm the consumer. Having too many choices can be confusing to consumers and that phenomenon is
referred to as the “tyranny of choice”. Arranging stock so it is not overcrowded, and limiting the amount of
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merchandise on the shop floor, are important aspects of merchandising. Over-crowded stores can create a sense
of stress and anxiety, which does not encourage the consumer to shop the entire store.

Bundling
Bundling is promoting objects that work together as a set. It inspires people how to use the products in their
lives and also makes complementary product suggestions. In a fashion retail store, complete outfits on a
mannequin or the placement of tops beside jackets and bags by other accessories such as scarves and jewelry
are an example of bundling. The store has already done work in envisioning the look the items can used to
achieve. Bundling also directs attention to specific products thereby limiting the product selection presented.

Atmospherics
The atmospherics also have a large influence on the store environment. Atmospherics should all coordinate with
each other to create a consistent ambience and positively influence the consumer’s shopping experience and
buying decision-making process. Visuals such as light and display are not always enough to enhance the overall
ambience of the store, and retain customer attention; therefore, other elements such as music and scents can be
used.

Light
Light can be used in many ways in retail stores, from highlighting an object or area of a store to simply
illuminate the entire store. Bright light can create a sense of honesty, positivity, and can promote impulse
purchasing. Lighting can also be used to highlight the store layout and urge customers to flow through the store,
exposing them to more merchandise. The level of brightness in the store is a very important factor in consumer
behavior and the retail environment, as rooms that have dim lighting are less arousing than more brightly lit
spaces. Lighting can influence the customer’s decision making, behavior, and also the overall spatial
environment as lighting and ambiance are connected. Customers become more stimulated when the lighting in
the room is considered to be very bright and speeds up the pace at which customers purchase products. Marking
recommended that in order to slow the pace customers shop at, the merchandiser should adopt a softer lighting
technique which will increase the amount of time customers spend in the store.  The result of this is a possible
increases in the amount of merchandise the stores customer’s purchase. This shows us that the differing levels
of in store lighting can directly affect the amount of time consumers spend in the store.
The lighting inside a retail store can be used strategically to highlight products on display or to create a
comfortable environment for consumers. It is an important element used (alongside music, temperature,
fragrance, and layout) in retail to create an atmosphere that matches with the brand’s personality. Atmosphere
of a retail store is significant as it was found that the mood of a customer will affect their buying behavior. A
retailer can use soft lighting to create a calm and peaceful atmosphere for the customer or bright lighting to
represent a fun and vibrant feeling associated with the brand. The strategic use of light can change the mood of
a consumer and affect their subconscious mind during their shopping experience within a retail store. A retail
store with a soft ambiance and bright lights highlighting certain products will drive the customer towards these
products and motivate them to make a purchase.

Music
The music played within a store can promote a brand’s image, and can also aid consumers into making purchase
decisions. Music that suits the style of the store and the target audience is an important factor to consider. Music
with a slow tempo can cause the consumer to relax; therefore, they spend more time in the store. This leads to
more contact with merchandise and increased purchasing. Having music, which is popular within the target
market, can also encourage consumers to linger in the store longer. For example, a store with a teenage target
market should consider playing pop music, as this is a genre that a younger audience commonly enjoys. Playing
this genre will make their shopping experience more enjoyable, which can result in them staying longer in the
store, exposing them to more merchandise, and influencing possible purchasing decisions.

Exterior Displays
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Exterior window displays can be used to sell product and entice customers into the store. An eye-catching,
innovative window display can promote the brand image. It can be used to advertise. Windows can give
consumers and by-passers understanding as to what goods are sold in store. They are also an effective way of
promoting fashion trends and providing useful information to the target audience.

Window Display
Visual merchandising is a multi-sensory tool used by retailers to catch the attention of customers and attract
them into a store to make a purchase. The first piece of visual merchandising customers encounter with a brand
is the window display. Window displays are used as an initial attraction to bring customers into a store and are
also used as a marketing tool to communicate the brand’s image to the consumers as well as to distinguish itself
from its competitors.
The importance of the window display is that it is a touch point consumers have with the brand. By generating
interest or curiosity with the window display, a brand can leave an impression on the consumer and furthermore
the consumer can figure out the quality and character of the products the brand has to offer. An appealing
window display can create desire of products from that brand and therefore help with generating sales.

CONTROLLING COSTS AND REDUCING INVENTORIES LOSS

Reducing inventory losses is one of the serious issues which store management faces. Inventory loss may result
from vendor errors, inaccurate records, mistakes, shoplifting and employee theft. Miscalculation and
miscounting of merchandise upon its delivery and not recording a product when it is sold out are the mistakes
on the part of employees which result in inventory loss. Moreover, when the vendor shipment does not contain
the required or adequate amount of merchandise as mentioned on the packaging details, then it is a mistake on
the part of vendors.
Reasons for Inventory Loss
The various reasons for inventory loss are as follows:
1. Shoplifting: When a merchandise or item is taken without paying any money for it in return, it is known as
shoplifting. Shoplifting is one of the major reasons for inventory loss in the retail sector.
2. Vendor Fraud: Almost every industry suffers from the problem of vendor fraud. Vendors may manipulate
their invoices or short their deliveries thereby causing inventory loss.
3. Employee Theft: Almost 75% of the employees steal at least once in their career and some of these steal
frequently. It is difficult to find a remedial measure for such a shocking figure. One of the ways to stop such
type of activities is by placing surveillance cameras in the retail store. However, this method proves futile,
since the placing of the surveillance cameras are in the knowledge of the employees who steal. Theft is
committed mostly by those who work on the retail floor.
4. Employee Embezzlement: Similar to employee theft, employee embezzlement is a serious issue which can
cost an organisation a lot. Frauds, like embezzlement occur usually when a single individual handles most of
the financial activities of a firm. An individual who is involved in embezzlement can use company credit,
divert deposits towards his/her account or pay unnecessary expenses to himself/herself. As employees can
be experts in concealing such type of fraudulent activities, embezzlement can get carried on for many years.
5. Administrative Errors: Administrative errors can cost an organisation a lot, even though they cannot be
considered as theft on the part of employees. For example, a retail shop assistant can, by mistake, enter a
different amount instead of the required amount. If this small mistake is repeated, then it can prove costly
for the store. These errors may also arise due to inaccurate recording of information on the part of
employees at the time of inventory receiving and merchandise selling. However, such errors can be
minimized by introducing automated computer systems or providing adequate training to employees.
Ways of Controlling Costs and Reducing Inventory Loss
There are mainly two ways of controlling the costs and reducing inventory loss namely, labour scheduling and
store maintenance:
1. Labour Scheduling: Labour scheduling refers to assigning or allocating employees to different areas of the
retail outlet. This task can be difficult due to the requirement of part time employees and multiple shifts in
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 the retail store. Moreover, there is a great variation in the customer traffic during different times of day. The
daily requirement of staff and the general pattern of shopping get affected by holidays and bad weather.

2. Store Maintenance: The activities related to the management of the internal and external physical facilities
of the store are covered under store maintenance. The internal facilities of the store encompass the signs
displays, ceiling, flooring, walls, etc., whereas the external facilities cover signs on the store's exterior, its
entrance, parking space, etc. Both the cost involved in the operations of the store as well as the sales
generated by it, are affected by store maintenance. Maintenance of the store is an expensive affair. The
perception of the customer regarding the quality of the b store's offerings is influenced by how neat and
clean the store appears.

PARKING SPACE PROBLEM AT RETAIL CENTERS

Retail centers like shopping malls, strip malls, and even large department or big-box stores thrive on a constant
influx of consumers. For this reason, retail center parking solutions must be adequate, safe, and well-planned to
keep these consumers coming back. Auto Park specializes in maximizing retail center parking areas, making
them larger, safer, and more convenient.

Crowded parking lots/too few spaces

The biggest concern when it comes to retail center parking solutions is a lack of space. Consumers who might
otherwise come inside to shop often change their mind when they find that they must park several hundred feet
from the door.
Lack of safety and protection
Most of the traditional “open” parking lots in today’s retail centers offer little to no safety or protection for
consumers. They are not well-lit, and they do not provide any kind of shelter from inclement weather or even
vandals.
Difficult loading/Unloading
Consumers visit retail centers to purchase things, and then they must load their purchases into their automobiles.
If the parking situation makes it difficult for consumers to load their cars, they are not likely to continue doing
business there.

Steps:
The Trip to the Shopping Center
Thirty minutes driving time is currently the accepted limit of the market area of a major regional shopping
center, which might serve up to 500,000 people. The area enclosed within the thirty-minute driving time has to
be calculated according to the condition and congestion of the streets and is not always in direct ratio to linear
distance. Five miles of expressway may be traversed more quickly than five blocks of crowded business section.
Shopping center developers recommend traffic counts of the major streets serving the center, not so much as an
indication of the business potentiality, but as a check on the congestion already existing and an aid in predicting
the traffic situation after the center is opened. As a matter of self-preservation, developers and architects
recommend further studies, including the future road-construction programs in the area, and future housing
developments and population movements in the area, so that other effects on business and traffic may be
determined.
Off the Road and Into the Center
Crowded highway intersections have long been considered good commercial locations, but the problem of
access to the shopping development is receiving much fuller consideration in modern shopping center planning.
The key to the access problem is not the volume of traffic passing the center, but the density. As traffic surveys
have often shown, the total number of cars passing a given point on a road (the volume) eventually drops as the
density gets close to the saturation point. The reason for this relationship is simple. The closer the cars are
packed together, the slower they must go. In such dense traffic, as might be said to characterize the rush hour
traffic of some Los Angeles freeways or the Chicago Outer Drive, tie-ups and delays are also more frequent,

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and more costly in terms of highway efficiency. The roads having highest volumes are those on which the cars
are spaced further apart and travel at higher speeds with relative safety.

Both the high-density and high-volume roads offer problems of access to the shopping center. On the high-
density, fairly slow-moving road, it will be difficult for drivers to maneuver into position to turn off. On high
speed roads, ample warning must be given the driver that he is approaching an exit, and the exits into the center
must be designed with safety features that take the higher speeds into account.
Few shopping centers will be served by high-speed, limited-access roads. Shopping centers being constructed in
developing areas will be served by an existing road network which may not be adequate to handle the traffic
that will arise when the shopping center is completed and the area is built-up.

The points of access from the roads to the shopping center should be adequate to accommodate traffic at the
busiest hours of the center. Victor Gruen, architect and designer of shopping centers (in “Traffic Impact of the
Regional Shopping Center,” see biblio) estimates that an exit or entrance with continuous flow can handle up to
750 cars per hour. The peak load of a shopping center can be estimated on the basis of the annual gross income
of the center. The problem is three-fold: first, to determine the largest single-day gross business; second, (on the
basis of the average purchase per car) to determine how many cars will be in and out of the center on that day;
and third, to estimate the number of cars that will enter and leave the center during the busiest hours of that day.
Parking the Car
Parking is the prime convenience advantage of the shopping center over the central business district. In spite of
the repetitive statement of this fact, the shopper may not always find the parking space he wants. The shopper
wants a space he can find easily, with a minimum of difficulty in moving around the parking area, and one that
is located near the store or store group in which he is going to shop. The fault is sometimes with the developers
who have underestimated the need for parking space or found the land too valuable to be devoted to parking.
Sometimes there are too few parking spaces simply because there are too many people with cars looking for
them.
Parking in the shopping center is seen by the shopper as a series of steps:
 Maneuvering the car around the lot until he finds a space;
 Getting the car into the space;
 Walking from the space to the stores.

RESPONSIBILITIES OF STORE MANAGER

Following are the major responsibilities of store manager:
1. Managing Store Employees: These are the people on whom the success of the store depends and in order
to ensure the selection of right person for the right designation, a strong and powerful manager is required.
Apart from these activities, the store manager is also responsible to ensure proper training of every
personnel to suit to the job position and to monitor the various activities which are carried out by them
during their working hours in the store. The store manager is responsible for the overall development of the
employees and not just for their hiring. The below mentioned steps are included in the activity of human
resource management in retailing:
 Development of job description and specifications with the help of job analysis,
 Recruiting the retail employees,
 Selecting the retail employees,
 Training the retail employees,
 Directing the retail employees,
 Motivating the retail employees,
 Compensating the retail employees,
 Evaluating the retail employees, and
 Controlling the retail employees.

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2. Controlling Costs and Reducing Shrinkage : Store managers are aware that they are required to
accomplish the set targets but only some know the fact that they also have to generate business profit. The
store managers must be aware that profit earned by the store decides the health of the store rather than sales.
As the existence of the store is also dependent on sales, thus, it is critical, but the main objective of any
business is to earn profit. The total amount of sales generated with the total incurred cost provides the
profitability. In order to have maximum profit, the ability of controlling the cost must be possessed by the
store manager. Inventory cost is also the part of cost. As some products are to be stocked to sell, it is quite
obvious for the store manager to occasionally monitor inventories and ensure timely orders. Apart from
monitoring the retail store inventory and placing the orders for the products, it is also the responsibility of
the store manager to pay for the products to be ordered and to monitor the expense on the product
procurement.
3. Managing Merchandise Presentation: Arranging proper display of the merchandise which grabs the
customers' attention is also the responsibility of the store manager. Fulfillment of the customer's
expectations as well as living up to the desired brand image must be ensured by the store manager.
Moreover, the store manager has to ensure the following:
 The cleanness of the store.
 Adequate stocking of racks and shelves and preventing the falling of products from shelves.
 Proper placement and rotation of mannequins so as to entice the customers.
 Seasonality and latest trends must be ensured in the merchandise.
 Proper ventilation, lighting and ambience should be ensured within the store.
 The correct placement of the signage, having the logo and the name of the store, so that it can be easily
viewed.
4. Providing Customer Service: The retail store manager also has responsibilities regarding customer service.
Quite often, the customers visiting the stores will desire to talk to the managers, if they have some issues
related to the shopping experience or if they want to complain or praise about a certain employee or even
the store. The highest rank in the retail store hierarchy is possessed by the retail store manager who listens to
the concerns of the customers either positive or negative. Thus, it is very important for the retail store
manager to have expertise in customer service. As loyalty of the customer, his/her satisfaction and comfort
during shopping depend on the level of customer service offered in the store; every retail business is
considered a service business.

STORE SECURITY
Install in-store security systems
While points of sale are mostly open, some lockdown restrictions still require the closure of many premises.
This means that both open and temporarily closed physical stores are vulnerable to theft and damage. And while
social distancing measures require a minimum distance between people, security technologies are in higher
demand than ever.
In-store security can be improved by an organizational and technical method of counteracting criminals.
Security policy and employee security training can help to prevent many threats related to employee behavior,
social engineering, etc.

Use security solutions to mitigate health and safety risks

A retail surveillance security system can help to control the number of customers allowed in the building, which
is a number one priority during COVID-19 restrictions. CCTV cameras and sensors can also come in handy for
tracking customers’ temperatures. Security officers with handheld temperature checking devices are the new
normal. However, security cameras powered by infrared technology automatically track body temperature,
allowing security guards to focus on other priorities.
Contactless payment is another technology solution that helps prevent the spread of the virus, and it saw a
significant uptick in 2020. With the implementation of technology comes responsibility. Encrypting credit card

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swipes will prevent hackers from accessing customers’ credit card data and reduce the amount of credit card
fraud.
Once you put your security system online for remote access, support, and maintenance, or connect it to the local
network, which in turn is connected to the internet, make sure it is secure. Here are some ideas on how to ensure
network security:
 Peer-2-Peer (P2P) method. Use P2P to first transfer data through a third-party server before connecting to
your system.
 Virtual Private Network (VPN). A VPN allows a direct connection with your security system and is one of
the most secure ways to access it.
 Port forwarding. Use this process to direct traffic from the outside world to the appropriate server, resulting
in a direct connection to your security system through your internet router.

Focus on e-Commerce cyber security

The rising number of cyber security threats and the continuous growth of online shopping require retail industry
players to keep customers’ data secure. The level of security technology implementation in retail is lower
compared to many other industries.
According to the Cyber Security Breaches Survey 2020, 40% of respondents in the retail and wholesale sector
hadn’t undertaken any action (see the chart below) to identify cyber security risks in the previous 12 months.

STORE RECORD
It is very important to have the record of the financial transactions apart from keeping an accounting software
programme. A method is required by the retailer so that he can maintain the receipts, loan statements, sales
records, past tax data and bank information. These will consist of the information which is of course, important
but not required to be stored instantly in an accounting software programme. It is important for the sales
associated, managers or any other individual who deals with the financial activities of the store to understand
the type of data to be maintained and the process of filing it.
Types of Store Records
The recording of the total quantities, issued, received, and remaining is maintained in stock control cards and
bin cards. The record of the volume and cost (or value) is termed as store ledger. Thus, the store accounts are
prepared in a quantitative form while the cost department maintains them in quantitative-cum-financial form.
Therefore, there are three main forms in which the material records can be maintained:
1. Bin Cards: Once the inspection department approves the materials, they reach the store and are placed in
separate numbered bins, racks, receptacles or drawers. Every bin will consist of a bin card indicating the
total number of materials received, issued and remaining. As soon as the materials are issued or received,
the entries are mentioned on the bin card instantly. The quantity of remaining materials mentioned on the
bin card should be consistent with the store ledger balances and the remaining materials inside the bin. If
there are some kind of variations in the physical stock and what is mentioned on the bin card, then the
answerability lies on the storekeeper.
2. Stock Control Cards: These cards have similarities to the bin cards. These are also used to manage the
store's quantitative records. The main point of variation between bin cards and stock control cards is that the
latter offers additional information, i.e., stock on order. Moreover, 'stock control cards' are maintained in
loose binders, trays or cabinets, whereas the receptacles or bins have 'bin cards' attached to them.
3. Stores Ledger: The record of value and quantity of materials issued, received and remaining when
maintained in loose paper sheets or cards, it is known as stores ledger. Store ledgers are subsidiaries to the
main cost ledger and are managed by the Cost Accounts Department of the store. The entries are made with
the help of goods received notes and materials requisition. A modern stores ledger is seen as a combination
of various cards or separate leaves which are maintained to have a record of both the quantity and worth of
the material received and material in stock. The cost accountant has to manage it as it is a subsidiary ledger
to maintain the main cost ledger. The entries are made with the help of materials requisition and goods
received notes.
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Techniques of Recording Stock
The different methods which are used to record the sock are given below:-
1. Periodic Stock Verification: The half yearly or quarterly verification of the complete stock in just a couple
of days in referred to as periodic stock verification. This is mainly carried out in those firms where the stock
is less but has relatively high value.
2. Continuous, Perpetual or Automatic Stock Verification : In this technique of stock recording, the process
of verification is carried out the entire year according to a predetermined action plan. The frequency of
verification varies as per the category of item. A category items are verified three times in a year, B items
are verified two times in a year and the C items are verified annually.
3. Spot Checks: Store keeper is responsible for carrying out spot checks during the receipt and issue of items
of the store. The staffs of the store perform these activities voluntarily for ensuring accuracy in the materials
and self-gratification.
4. Stock-Out Stores Verification: When a certain item goes out of stock, then organisations resort to this
technique of stock verification. Low point stores verification is also carried out when the level of stock
becomes so low that its replenishment becomes necessary. Usually the store house staffs perform this
verification. These kinds of verification records are maintained by the store keeper.
5. Annual Stock Taking: It is quite important to have a thorough verification of stocks once a year in the
event when continuous stock taking by the accounts department and periodical stock verification by the staff
of the store is not effective. At the last month of any financial year, the process of annual stock taking is
carried out.
Methods of Stock Valuation and Records
The different methods which are commonly used in the stock valuation and records are stated below :-
1. Last in First out (LIFO) Method: The main assumption of this method is that those items will be issued
first which are received at last. The main objective of this assumption is the cost assignment rather than the
physical product flow.
2. First in First out Method (FIFO): Under FIFO, those materials are issued first which are received first.
Once the first lot of the product purchased finishes, issue is done with the next lot. In a way, the order in
which the products are received in the store, the issue is done accordingly.
3. Highest in First out Method: Under HIFO, those materials are issued first which are priced highest. The
date of purchase is not taken into consideration. The idea behind this technique is that the item can easily
absorb material expenses and give the cost of the product during inflation or when market prices for
materials fluctuate.
4. Next in First out Method: In this method, the price of the material issue is determined on the basis of the
quoted prices of the latest purchase order, until the placement of a new order.
5. Standard Price Method: The standard prices are used for the issue of the material. The price which is fixed
for a certain period depending on the different influencing factors is termed as standard price. The following
factors are needed to be considered before determining the material standard cost as such Transportation
cost, Discounts, Market trends, and Existing prices, etc.
6. Specific Price Method: In this method, the rate in which the material is originally purchased becomes the
price of issue of the materials. Materials purchased for a particular work or job, utilize this method. This
will require the allocation of every material lot bought for a certain work or job order for which the
purchasing of the product is done. The industries which execute individual contracts or jobs against certain
orders adopt this type of method.
7. Base Stock Method: The base stock method assumes that a minimum inventory must be kept at all
occasions for use in the event of an emergency. This minimum inventory is called base stock. The acquired
cost of base stock is used for its valuation. Fluctuations in price do not affect the value of the base stock.
Like a fixed asset, it is carried forward.
8. Periodic Simple Average Price Method: There is no major difference between simple average price
method and periodic simple average pricing besides the fact that periodic calculations (e.g., monthly,

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 weekly but not at the time when materials are issued) are involved in average price. The formula for
calculating periodic simple average price is:
Total of purchase prices duringthe period/ No . of prices during the period
9. Moving Simple Average Price Method: In this method, one can compute the material issue rate by
dividing the aggregate periodic simple average prices of certain time periods by the number of periods. The
first period to be used in order to decide the average is important to be determined for calculating the
moving simple average price.
10. Moving Weighted Average Method: Under this technique, one can compute the price by dividing the
aggregate periodic weighted average prices of certain time periods by the number of periods. More correct
results are provided by this technique, since both price and quantity are considered to calculate the weighted
average. It has similar merits and demerits as that of the simple average price methods.
11. Replacement Price Method: The price, at which material replacement is possible by buying it from the
market, is termed as replacement price. In fact, it is a market price. In this method, whenever the material
issue takes place, one has to compute the replacement price.
12. Inflated Price Method: Under this technique, the material issue price is raised, so that the losses (occurring
due to the intrinsic nature of the material, like evaporation) can be covered.
13. Re-use Price Method: If the use of a processed material is done in any other activity rather than for the one
it was meant for, then there will be a variation in the price of this material than that of the original price. The
material usage valuation does not have any standard procedure.

ACCOUNTING SYSTEM
An important element of management which deals with the identification, presentation and integration of the
information associated with retail trading is known as accounting system. A wide variety of financial criteria is
offered under retail accounting system with the help of which the retailer can evaluate his/her operational and
strategic decision-making.
A retail accounting system has the following objectives:
1) To make the retailer aware about the financial position of the business at the end of a certain period, and
2) To make the retailer aware about the profit and loss position of the business pertaining to a certain period.
One can achieve these two objectives with the help of 'final accounts', i.e., the profit and loss account, trading
account and balance sheet.
Income Statement
The total revenues generated and expenses incurred by any organisation are recorded in the income statement.
The operational performance of any organisation for a certain time period is represented by its income
statement. The inputs are revenues and expenses of the firm, while the output is seen as the profits generated.
This is commonly termed as Profit and Loss Statement prepared for a certain time period.
Components of an Income Statement
There are mainly nine different categories of an income statement:
1. Net Sales: When the sales discount (provided to the customers for boosting the sales) and returns and
allowances (provided to the customers for the defective and returned items) are subtracted from the gross
sales earned by the retailer in a certain time period (generally annually, monthly or quarterly), it gives us the
net sales.
2. Cost of Goods Sold: The cost paid by the retailer to acquire the merchandise is known as the Cost of Goods
Sold (COGS) or cost of sales. This encompasses the actual price at which the goods and services are
purchased as well as the freight-in costs.
3. Gross Profit: The difference between the net sales of the retailer and the cost of the goods sold represent
the gross profit or gross margin. Alternatively, this can be seen as the amount which is spared by the retailer
to account the various expenses associated with the retail business operation.
4. Operating Expenses: The normal costs (besides the merchandise cost for sale) which are incurred while
conducting the business are called operating expenses. Such expenses encompass utilities expenses,

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 insurance costs, personnel costs and mortgage costs. Retailers generally split personnel costs into heads such
as administrative expenses, general expenses and selling expenses.
5. Net Income from Operations: This is represented by the difference between the gross profit and the
operational expenses. It indicates the degree to which the major retail operations are generating profits for
the business.
6. Other Income (Expenses): This head encompasses other items of income and expenses for example,
dividend income, interest expense, interest income and gains or losses on assets disposal. These are not
included in the business operations and thus do not form the part of the sales and expenses incurred directly
in the operations.
7. Net Income before Taxes (NIBT): It can be determined by finding out the difference between net income
from operations and the net effect of other income (expenses) and also termed as net income before income
taxes
8. Income Taxes: These can be seen as the different central and state taxes on the net income before taxes.
9. Net Income after Taxes: The difference between income taxes and the net income before taxes give the net
income after taxes.
Balance Sheet
Balance sheet is another means employed by people investing in the business to examine the turnover of the
firm. Generating financial statements is the foremost step of the process of assessing and managing a retail
firm's performance. Balance sheet is the utmost and quite generally talked about financial statement. The assets,
liabilities and net worth of a retail firm at a given time period are specified in a balance sheet. Hence, it is
possible for a retail firm to generate a balance sheet for any particular day in the entire year. Generally, balance
sheets are prepared yearly, monthly or quarterly. Balance sheet is based on the primary notion of:
Assets=Liabilities+ Net worth
Components of Balance Sheet
1. Assets: Anything valuable which is owned by the retailer can be considered as assets. Assets can be
generally divided into two categories namely:
2. Long-term Assets: Assets utilized to handle the business activities are known as long-term or fixed
assets, e.g., land, property, equipment, etc.
3. Current Assets: Current assets are utilized on a daily basis for business operations. Thus, they include
cash and other items that are highly liquid for maintaining ease in operations, e.g., accounts receivables
and inventory.
4. Liabilities: Liabilities can be referred to as financial commitments that a firm has to fulfill and these can
also be split into two well defined categories namely;
5. Long-term Liabilities: Outstanding payments which the firm is obligated to fulfill in more than one
year's time period are called as long-term liabilities.
6. Current Liabilities: Also known as short-term liabilities, they include outstanding payments the firm
is obligated to fulfill in the subsequent year.
7. Net Worth: Besides assets and liabilities, net worth is the next vital constituent of the balance sheet.
Generally also known as owner's equity, it can be calculated by subtracting liabilities from assets owned by
the firm. Dependent on the cost, net worth indicates the retail firm's net value.
Business Ratios
The success or failure of any retailer in achieving the performance targets can be measured with the help of
certain ratios. Performance of the firm in short term and long term can be, to a great extent, influenced by such
ratios. Some important business ratios are described below:
1. Quick Ratio: Quick ratio can be calculated as follows:
Cash+ Accounts Receivable /Total Current Liabilities
These total current liabilities include outstanding payments to be made within one year's time period. If the
ratio is greater than 1:1, it indicates that the firm is liquid and is, without any difficulty, capable of paying
back current liabilities.
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2. Current Ratio: Current ratio can be calculated as follows:
Total current assets /Total current liabilities
Here, total current assets include cash, merchandise inventories, accounts and notes receivables and market
securities. A ratio of 2:1 or greater than that indicates a favorable condition for the firm.
3. Accounts Payable to Net Sales: This ratio can be calculated as follows:
Accounts payable/ Annual net sales
This ratio helps the firm to understand how it pays its vendors in comparison to the total volume transacted.
4. Overall Gross Profit: This ratio can be calculated as follows:
Net Sales−Cost of Goods(COGS)/Net Sales
The value calculated above is all inclusive and considers any inadequacies, markdowns, discounts. Retailers
use overall gross profit to cover both net profit and operating costs.
5. Collection Period: A retail firm can calculate its collection period by using this formula:
Accounts Receivables ×365 /Net Sales

CODING SYSTEM: BAR CODING

Generally, a group of bars (of variable width) and spaces between those bars forms a bar code. In spite of the
fact that human beings cannot read and understand these codes, scanners specifically designed to read the bar
codes are developed for user convenience. An act of encrypting an identification number into anything that
would appear distinct is the basic concept behind bar codes. However, bar codes do not provide every detail of
the product. There is, in general, an agreement between recipients and vendors with regards to numbers to be
used for developing bar codes. Bar code technology comprises the following elements:
1. Symbologies which encrypt the data that is to be optically read,
2. Printing technology which develop machine readable symbols,
3. The decoders and scanners which capture the visuals of the Symbologies and transform them into digital
data, and
4. The verifiers which validate the quality of the symbol.
A barcode is just a graphical representation of a code allowing a scanner to transfer this code to a database and
from here the additional details related to a product or item, such as its size, dimensions, price, and so on, are
once again transferred to a computer screen which is then read by the user.
Benefits of Coding System
Coding systems can provide the following advantages to retail businesses:
1. Saves Time: A lot of time can be saved on the basis of method of application used by the firm. For
example, if a retail business wants to know its inventory status, then with the help of coding system, it can
scan the bar codes of cartons in not more than 30 seconds. On the other hand, it would take around 2
minutes to note down the serial numbers and product codes manually. This is considerable amount of saving
if the level of operations is excessively occupied.
2. Improved Operational Efficiency: It is possible to meticulously follow the work in progress (WIP) and
also move it expeditiously with the help of bar codes which enable quick and more error-free information
recording. Making a note of various activities and business operations, such as status or location of projects,
materials, instruments, folders, etc., can take a lot of time, however, coding system can help improve the
process thus, saving on a lot of time. It can also assist in quickly acknowledging questions and changes, if
any.
3. Cut Costs: Various localized and specific issues can be addressed through bar codes. Bar codes can also be
integrated into the overall information systems of the organisation. Barcodes can lead to decrease in costs
incurred, as they help save lot of time and decrease mistakes if executed with planning.
4. Customer or Regulatory Requirements: It is obligatory for the firm to fulfill the labeling necessities
levied by regulatory bodies or even customers. However, barcodes, if utilized internally by the firm, can
help save time as well as capital even though these necessities are significant while conducting business
operations. For example, the barcode labels printed to meet customer requirements can also be utilized by
scanning them to gather shipping manifest details in a more quick and precise manner.
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5. Reduce Errors: A lot of unnecessary costs can be incurred by the firm by way of clerical and data entry
mistakes. These mistakes can further lead to other problems. Examples of such mistakes are additional
freight costs, amount of time required to find out the problems and finally, dissatisfied customers.
Limitations of Coding System
Coding systems also calls for certain constraints for the retail businesses:
1. Label Damage: A lot of problems can be faced while scanning the barcodes, if they are damaged, streaked,
stained or printed on a part of packaging which is torn. And if the damage is such that the equivalent
numeric code is also unreadable, then the checkout process can be majorly slowed down. The only solution
at this time would be to find out different pack of the same item and get it to the scanning machine' to
complete the checkout process.
2. Upfront Cost: New equipment is necessary to install bar coding system in the firm. Some firms may find
the cost involved very high and hence, keep away from doing so, in spite of the several benefits which could
be derived from the system.
3. Pricing Discrepancies and Scanning Problems: Retail firms, many times of the year, extend discounts and
offers to their customers. Employees working in the store are likely to forget to code the discounted price on
those items that are covered under the discounts. As a result, a lot of confusion could be possible at the
checkout counter which delays the process eventually, causing nuisance to everyone including the customer
involved, other customers waiting behind that customer in the queue and the checkout clerk who is trying to
resolve the problem.
4. Financial and Equipment Costs: A very high cost is associated with equipment required to implement
coding system in firms that have not updated themselves to the barcode checkout process yet. Once
installed, employees need to be trained to get familiar with the new equipment and system. Also there can
be deferment as new costly printers should be bought to print coded labels on items that do not have barcode
printed on them beforehand. Usually, few printers are unable to sharply print detailed barcodes, such as ink
jet and dot matrix printers.
5. Printer Requirements: Expensive and good quality printers are essential for developing bar codes as
generally used printers, such as ink jet and dot matrix printers are incapable of printing finely-detailed, high
quality bar codes.
6. Training: Providing training to employees to efficiently use new equipment and systems while launching
the bar code system in the firm can be very expensive. This can be a major problem in case it is a large
business house.

LOGISTIC IN RETAIL
The term logistics can be referred to as a three step process starting from planning, executing and in the end
correlating the physical flow of products from the producer of wholesaler, to retailer and then finally to the
customer or end user in a way which is, to the greatest possible extent, efficient, productive and prompt.
According to Council of Logistics Management (CLM), "Logistics is the process of planning, implementing
and controlling the efficient, cost-effective flow and storage of raw material in-process inventory, finished
goods and related information from point of origin to point of consumption for the purpose of confirming
customer requirements".
As per logistics, various aspects, like inventory management, customer service, warehousing, transportation,
order processing, etc., are considered as mutually dependent functions in the chain of value delivery. As
effective logistics system ensures decreased stock outs, enhanced customer service and adequate level of
inventory.

Objectives of Retail Logistics

The objectives of logistics are as follows:
1. Improving Customer Service: By attaining customer satisfaction, highest level of profits can be ensured.
Thus, continuous improvement in customer service acts as the core objective of logistics.

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2. Speedy Response: It refers to the organization’s ability to give prompt response to the customers' queries.
In today's era of IT, it has become completely manageable to give immediate response to the customers'
queries by acquiring related data and postponing logistical functions to latest time for increasing the
response rate.
3. Decreasing Costs of Total Distribution: Decreasing the costs associated with overall distribution is
another vital objective of logistics. The expenses on distribution of goods include expenditure on shipment,
storage and record keeping, etc. As these processes are interlinked, reducing the cost of one function often
increases the cost of the other.
4. Consistent and Reliable Delivery Performance : Ensuring consistent and reliable* delivery performance is
another main objective of logistics. This will significantly help companies to strengthen their relationships
with the customers by developing trust and gaining confidence.
5. Least Product Damages: Damaged products contribute to extra expenditure on logistics. This extravagant
expenditure on damage can be avoided by using mechanical system for handling materials, using logical and
efficient system of packaging.
6. Creating Additional Sales: One of the other aims of logistics is to increase sales by creating additional
sales. This can be attained by providing better services in the most economical way.
7. Generating Place and Time Utilities : Ensuring the utility of product at right time and right place is another
main objective of logistical functions. The product is not good for the consumers until it reaches them at the
right place and right time.
8. Stability of Costs: Another purpose of logistics is to ensure the stability of costs. It can be attained by
managing the supply of goods through thoughtful use of the accessible transportation and suitable storage
facilities.
9. Upgrading Quality: In the long-run, logistics seeks to ensure continuous quality improvement. Total
Quality Management has emerged as a primary obligation in all parts of the industry within this aspect. Its
assurance is mainly responsible for logistical regeneration.
10. Lifecycle Support: A sound logistical system is mainly responsible for maintaining healthy PLC.
Sometimes goods are sold without giving guarantee regarding their lasting performance as advertised. These
situations call for reversing the direction of normal value added inventory offered to the customers.
11. Movement Consolidation: Transportation cost is one of the most important logistical costs as logistics aims
to reduce costs through consolidation and integration of operations. It is directly related with the product
type, shipment size, distance, etc. Thus, movement consolidation becomes desirable for ensuring the
reduction in transportation costs.
12. Inventory Reduction: One of the major factors which can prove to be unfavorable for the firm is heaps of
records. Conventionally, abundant inventory was maintained for ensuring good customer care services,
which indulged a lot of expenditure. Thus, reduction in inventory is another main objective of logistics.
Components of Retail Logistics
The components of retail logistics include the following:
1. Storage Facilities: Storage facilities can be in the form of distribution centers, warehouses or just stock
rooms of individual retail outlets. Retailers handle such facilities to maintain stock as per the anticipated or
actual demand of products.
2. Transportation: A product undergoes a process from manufacturing to consumption, wherein it has to be
physically moved in some way from one place to another. Hence, it is definitely essential for retail firms to
deal with transport operations which could involve checking the availability and scheduling of vehicles and
drivers, various modes of transport and the size of vehicles and containers.
3. Communications: Retailers should be acquainted with market information, like demand and supply along
with stock, prices, movements and volumes in order to obtain products at the required location. Thus, there
is an increase in conscious efforts on the part of retail firms to be competent to collect information at
suitable points in the system and to employ that collected information to have productive and efficacious
logistics operations.

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4. Inventory: Some amount of inventory is a must for every retailer. But the real challenge to be met by the
retailers is to decide where and how much of inventory is required, i.e., the site to be selected to keep this
inventory and the amount of stock to pile up for each product to fulfill changes in market demand.
5. Unitization and Packaging: Usually, consumers buy smaller packs of products that are easy to carry and
handle. Packaging and product presentation are the important factors based on which customers, at times,
make their decision to buy the product or not. Keeping in mind these factors, retail firms are interested in
coming up with products that are affordable in terms of packaging and managing, and simple to handle, in
terms of logistics.

INFORMATION SYSTEM IN RETAILING: RETAIL INFORMATION SYSTEM

All the significant retail data and information collected during the market research process is, in a well orderly
manner, collected, studied, stored and used under the technique known as retail information system (RIS),
Retail firms can take aid of enhanced connectivity possible because of extensive area networks, thus, proving
that systems are not any more limited to any particular office or building. A centralized system of MIS,
accounting and retailing can enhance the levels of performance in the organisation. However, in the end, it is
the human touch which determines the success or failure of a retail firm. It is just that the human touch can be
made more profitable, caring and effective through automation and technology.

Types of Information Systems

Merchandising, administrative divisions, point of sale system, sales and marketing, accounts, attendance and
payroll together constitute a typical retail firm. Following is the list of requisites that are fulfilled by the
information systems outlined for retail firms:
1. Sales and Marketing System: Customer related data can be obtained from the merchandising system
hence, it is necessary to have a close association with it. The market can therefore, be covered in an efficient
manner with the help of useful data produced by the sales and marketing system.
2. Merchandising System: The base of various systems is merchandising system which ensures fulfillment of
all requirements particular to customers. These requirements include stock transfers, buying of stocks,
exhibiting stocks, and so on.
3. Financial Accounting Systems: Accounts Payable (useful for Payment and General Ledger) and Accounts
Receivables function, also called as credit management are the two major areas covered under the financial
accounting systems. If the system is able to produce correct details, offer accurate credit rating and have
powerful hold on collecting payments on the stipulated due date and examine the credit aging, etc., it can be
successful in gaining powerful oversight.
4. Administrative Systems: Necessary facilities including proper lighting, air conditioning, plumbing,
furniture and fixtures, power supply, etc., are to be taken care of by the administrative system of the retail
firm. The administrative division should essentially be aware of any complaint or grievance of maintenance
nature registered with anyone in the entire system.
5. Point of Sale System: This system of the retail firm deals with the sales division. It is responsible for a
number of jobs undertaken by the firm namely; placing orders, splitting up of the orders for different
categories, analysis of both fast and slow-moving items, billing, etc.
6. Attendance and Payroll: A huge number of staff is required by firms having series of outlets and also other
large scale retailers. The Human Resource Department (HRD) is in charge of keeping a proper record of
attendance details and payroll. HR department can have easy access to pertinent staff related information,
such as salary details, loan details, attendance, and absenteeism, etc., owing to this system.

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Importance of RIS
Following points describe the importance of RIS:
1. Facilitates the Market Research Process: Market research refers to the process of gathering, organising,
evaluating and distribution of the information pertaining to the specific area. The market research process is
facilitated through an RIS. RIS helps in seeking solutions to various research problems.
2. Management of the Supply Chain: A RIS that is well developed can aid in:
 Managing the supply chain,
 Product acquisition,
 Integrated marketing communications,
 Merchandising,
 Pricing,
 Distribution,
 Data warehousing,
 Finance department, etc.
3. Integration of Multi-Channel Distribution: It has now become essential to integrate RIS between
websites, store outlets and other" media since a lot of businesses are now employing more than one channels
to offer goods and services (becoming multi-channel retailers). The capacity of RIS to combine online
information with other sources, such as behaviouristic, demographics and catalogue and in-store purchases,
permits a retailer to convert these visions into action.
4. Miscellaneous Use of RIS: An effective RIS has various other uses:
 The scope of data collection is organized and broad.
 There is regular collection and storage of data, which assists in avoiding crisis and foreseeing
opportunities.
 Effective coordination can be maintained among the strategy elements.
 The development of new strategies becomes quicker.
 Retailers get quantitative results.
Decision for Building RIS
Various decisions have to be made in the construction of retail management information system. These are as
follows:
1. Role of RIS: There may be two different roles that a RIS plays, one is proactive role and other is reactive
role. Proactive systems continuously search for organisation related information and distribute it to the
concerned managers, whereas, reactive systems react only when the problem arises and managers need
some information.
2. Internal versus Outsourced RIS: A number of retailers are there who perform the functions of RIS
according to their own way and some others hire outside specialists to direct their RIS. These both styles of
RIS can work properly, until and unless retailers provide information that is essential for the guidance of
RIS.
3. Cost of RIS: Determining the RIS expenditure is also an important issue for the retailers. Generally,
retailers spent 0.5-1.5 per cent of their respective revenues for the RIS, which is far less than other
organisations, like the manufacturers from whom the retailers by merchandise.
4. Technology Driven RIS: The information can be collected by small organisations with the help of
consumer surveys, trade association meetings, etc. However, most of the retail organisations prefer
information technology for collecting and analyzing data. Certain advents, like cheaper LANs, software,
computers/laptops, etc., have made the RIS an easy task. Therefore, retailers have to decide which level of
technology to be used in RIS.
5. Amount of Data: The data is very useful for the RIS to generate information for the retailers as they utilise
it in the development of retail strategies. There may be situations of information overload or little
information based on the amount of data available. Therefore, it is required to control the amount of data
flowing through the RIS. It is the duty of the retailer or retail manager to manage the amount of data.

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6. Path of Data Dissemination throughout the Firm : Another important concern for the RIS is the path of
data dissemination throughout the retail organisation. In this, it should be clear that which people in the
organisation have access to databases, who is/are responsible for receiving different reports, and what is the
data distribution frequency within the organisation. It is very essential to maintain coordination between the
access and distribution of the information especially when the retail organisation has different regional
stores or different divisions.
7. Data Storage: Data storage and retrieval related decision is the key to successful RIS. The data should be
stored in such a way that the recovery of data becomes easy and can be easily retrieved to analyze it at any
point of time.

RETAIL STRATEGIES
A clear and well-structured plan that the retailer drafts to capture the market and develop a long-term
sustainable relationship with the consumers is termed as a retail market strategy. Generally, the duration of such
strategies is of one year. The aspects which are covered under this strategy include the overall mission & goals
of the retailer, target market, store activities & operations, and a suitable control system. It is not easy for a
retailer to cope-up with marketplace changes and remain stable without an effective and well-structured retail
strategy.
The basic pillar of the existence of any retail organisation is its retail market strategy. It helps to define the retail
organisation, its purpose and response to various challenges in the marketplace. It highlights in what manner the
retailer will actually encounter those challenges. Different operations belonging to the retail organisation,
design their own operational strategies so as to provide sustenance to overall retail strategy of the organisation.
Therefore, one can easily understand how the information, systems, and procedures are managed by the retailer.
Components of Retail Strategies
Generally, the retail strategy is in the form of a statement, which includes:
1. Target Market and Retail Format Suitable for It : The segment(s) of the market for which the retailer
designs its retail mix and uses its resources is called target market. Moreover, retail format includes the
location of the store, its interior & exterior designing, type of products & services included in the store,
promotion methods, pricing policies, etc.
2. Bases of Sustainable Competitive Advantage: These are unique selling properties or the distinct features
which differentiate the retailer from other competitors and provide it advantage over them. These offer long-
term advantage to the retailers.

RETAIL PROMOTION
When a retail organisation tries to inform, persuade, and/or remind the prospective segment of the market (or
target market) about its marketing mix strategy for the fulfillment of its organizational goals, it is called retail
promotion or communication. In the process of promotion, retailers try to communicate with prospects or
customers with the help of several tools, like advertising, sales promotion, personal selling, public relations, etc.
Promotional methods used by retailers are much more different from that used by manufacturers. Promotional
campaigns of retailers are more geographically concentrated than that of manufacturers. The retailers advertise
through various mediums, like local newspapers, local television channels, posters, billboards, radio, etc.
Such campaigns are cheaper than a national campaign done by brand manufacturers. Instead of a slow
conversion of the mind-set and brand image (which is the objective of several brand promotion programmes),
retailers want instant impact of their campaigns.
Retail Promotion Strategies
Different promotional messages or advertisements are developed by the retailers which they want to deliver to
target customers/market segment. In order to effectively deliver such promotional messages to the target
market, they require different communication tools. These communication tools are collectively called as retail
promotion strategies or retail promotion mix. Organizational goals of the retailers, their product mix, resource

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availability, and market profile of the target customers determine the nature and extent of use of each
promotional tool.
Retail Sales Promotion
Retail sales promotion helps the retailer to attain the promotional objectives effectively and efficiently. It not
only helps in differentiating between the retailer and its competitors, but is also a good way to generate
demands. Retail sales promotion is intended to change the brand preferences and purchasing behaviour of the
consumers. In this way, they (customers) can benefit from the various sales promotion tools which offer
something exciting, different and special to them. Retailers have long known this.
Retail Sales Promotion Tools: Retail Sales Techniques
Sales promotion tools are of two types:
1. Sole-Sponsored Sales Promotions: Sales promotion is an outflow of money which retailers might have to
bear all alone. In case of sole-sponsored sales promotions, the retailers have to bear all the costs, but the
complete control over the promotional activities also stays with them. There are several retail sales
promotion tools which are as follows:
 Premiums: The additional items which the customers receive when they purchase an advertised
product are known as premiums. For example, free toys are given away along with Happy Meal to the
buyers by McDonald's. Such programs are the complete responsibility of the retailers, however there
might be certain exceptions.
 Contests and Sweepstakes: There are times, when a retailer may arrange a contest to attract new
customers towards its products. The contest gives a chance to the customer to win in cash or kind. It
could be a free air ticket or it could be anything. The launch of new product may involve such sales
promotion. Sweepstakes is similar to participating in a lottery. For example, various local restaurants
keep a track on their customers as well as generate business by making use of Weekly drawings.
 Loyalty Programs: Under loyalty programs, the loyal customers are rewarded for their multiple and
repeat purchases by the retailers. For example, the airline industry with the help of its frequent flyer
programs made loyalty marketing programs more popular. Through loyalty programs, the budget
allocated for sales promotion is invested in such activities through which greater amounts of profits can
be generated from the loyal customers.
2. Joint-Sponsored Sales Promotions: Retailers can use "Other People's Money" (OPM) in case of jointly
sponsored sales promotions. In some cases, this kind of sales promotion requires the retailer to hand over
some control to the co-sponsor. Following are the joint-sponsored sales promotions:
 Coupons: Generally, coupons are provided to customers for influencing their buying activity and to
promote the sales of a particular product. These coupons are the tools, providing a certain amount of
saving on the purchase of a particular product. These coupons are generated by the manufacturers and
are offered to customers with the help of different retailers. More commonly, these coupons are
packaged along with the product.
 In-Store Displays: In-store displays generally attract more people to the store and cause impulse
purchases from the customers. Both manufacturers and retailers jointly design the in-store displays for
getting the attention of the customers in the store. Window displays, end caps (selves at the end of an
aisle), and register racks at the check-out are some examples of joint-sponsored in-store display
arrangements at a retail store.
 Demonstrations and Sampling: In-store presentations or showings which reduce the assumed risk of
the customer for purchasing a new product are called demonstrations. The manufacturer pays the cost of
this demonstration in return of the expectation of customer purchase. Some samples are also distributed
within the stores to the customers to make them familiar with the new product of the manufacturer.
Role of Retail Sales Promotion
The role of retail sales promotion is as follows:
1. Stop and Shop: It is the sales promotion tactic which compels the passing by customers outside the retail
store with no buying intention to visit it. These sales promotion tactics do not directly encourage the
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 customers for making purchases, but, they compel them to give it a try. For example, a retailer may offer
free hairstyling to the customers for promoting its hair gel.
2. Shop and Buy: Sales promotion tactics help the retailers in presenting or demonstrating the products in
such a manner that customers get convinced and want to buy the product. For example, the retailer offers a
free bottle of shampoo on the purchase of one bottle of hair gel or there is a heavy discount on the purchase
of hair gel.
3. Buy Bigger: Another role of sale promotion is to convince the customers to buy large amount of
merchandise from the retailer. Here, the retailer uses such sales promotion tactics that the customer does not
hesitate in buying greater quantity. For example, Big Bazaar offers their customers cash back of Rs. 5000 in
their future pay wallet on making a purchase of more than Rs. 5000.
4. Repeat Purchase: From retail sales promotions, customers get motivated and purchase again and again
from the store. Different offers and schemes are the main reasons for such loyalty. For example, Indian oil
initiated a contest in which regular customers of the Indian oil petrol were entitled to a lucky draw, where
they could win a trip to ICC World Cup final match at England.

CRM: A HISTORICAL PERSPECTIVE

In today’s competitive business scenario, customers have numerous alternatives for a single product. This
encourages them to switch from one brand to another brand on the factors, such as the quality and price of the
product. Therefore, organizations have realized the fact that it is important to grab customer attention by
establishing a unique brand identity and providing excellent customer service. The organizations that were
initially focused on earning high profits are now shifting their priority towards managing cordial relationships
with their customers. For this, organizations need to interact with customers regularly to understand their needs,
tastes, and preferences.
CRM: DEFINITIONS
Customer Relationship Management (CRM) is a tool that helps an organization to strengthen relationships with
its customers. CRM refers to a business strategy that enables organizations to better serve the needs of their
customers, improve customer service, achieve a high level of customer satisfaction; thereby maximize customer
loyalty and retention.
CRM is an enterprise approach to understanding and influencing customer behavior through meaningful
communications in order to improve customer acquisition, customer retention, customer loyalty, and customer
profitability. –
Swift
CRM is a comprehensive strategy and process of acquiring, retaining and partnering with selective customers to
create superior value for the company and for the customers. – Parvatiyar and Sheth
A CRM system is a combination of people, processes, and technology that seeks to provide understanding of a
company’s customer and to support a business strategy to build long-term, profitable relationship with
customers. – Shang and Feng Ko
CRM is defined as an effective tool to achieve the objectives such as satisfied and loyal customers and
increased market share. – Shafia
Customer Relationship Management is a continuously updated process of identifying relative value of
customers and designing customized company interaction to delight them so that they do not just remain with
the company profitably but also be the company’s ambassador.
CRM is an integrated approach to identify, acquire, and retain the customers.
Features of CRM
1. CRM is a process.
2. Company interaction requires customization suiting to the exclusive profile of the customer.
3. CRM strives for customer delight.
4. CRM process aims at profitable relation with the customers.
5. CRM also aims to convert them to act as a company’s brand ambassador.
6. Employees’ involvement and empowerment is a must for its successful implementation.
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7. Adequate technological support is also essential for successful CRM.
EMERGENCE OF CRM PRACTICE
The recent growth of CRM can be attributed to various factors. These include the reduced role of
intermediaries, especially with the introduction of sophisticated computer and telecommunication technologies.
This growth in technology again allowed the producers to directly communicate and get in touch with the
customers 24×7 at a very low cost. The technology has given marketers more means at lesser cost to customize
the marketing efforts. Hence, a modern service provider does not require middlemen to the same extent as it
once used to. Modern consumers are also found to be more interested and happy in dealing with the company
directly.
The success of doing without intermediaries is also on account of the growth of service economy. Since services
are produced and delivered at the same time, the role of intermediary gets lessened. Since the customers transact
directly with the service provider, he develops greater relational bonding with the company and its people. This
leads to greater need of maintaining and enhancing the relationship which provides greater fruits. This makes
CRM so important for all those people involved in marketing of services.
Another factor which has been responsible for the increased need and use of CRM, is enhanced emphasis that
companies lay on adopting total quality management (TQM) as an essential component of modern business.
This increased use of total quality in all functions of the management by the companies has forced them to
involve the suppliers and the customers across the value chain.
In this era of hyper competition, marketers are forced to be more concerned with customer retention and loyalty.
As several studies have indicated, retaining customers is a less expensive and a more sustainable competitive
advantage than acquiring new ones.
CRM CYCLE
The CRM cycle consists of those stages that matches to the objectives laid it its definition. That is, from
acquisition of customers by creating value to them to learning from the customers, going by the route of earning
profits from them for the organization on a sustained basis.
The CRM cycle is as follows:
1. Obtaining information from customers.
2. Creating superior customer value.
3. Building loyal customers.
4. Acquisitions of new customers.
5. Working towards increased profitability.

Information from
Customers

Increased Creating Superior

Profitability Customer Value

Building Loyal
Customers
New Customer
Acquisition

CRM CYCLE
Customer acquisition starts either through the traditional advertising or through referrals. The next stage is of
customer development through personalization of communication and customization of products & services by
way of a mutual learning process. As a result, organization creates superior customer value through cross-
selling. Then retention of existing customer takes place. The organization also benefits from the new customers
that it acquires through positive referrals.
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STAKEHOLDERS IN CRM
Following are the stakeholders who play a major role in the entire process of CRM:
1. Customers→ Customers are the most important persons in the CRM design for whose delight the whole
exercise is conducted.
2. Employees→ They are the sets of people who execute the CRM design. They include those from the
frontline staff who actually executes to the top management who designs the CRM.
3. Suppliers→ They are the part of system who provides input to a company’s value chain.
SIGNIFICANCE OF CRM
The American Society of Quality and Arthur Anderson Consulting Inc., in their report published in 1977, have
brought out following findings about customers:
 Customers tell 8 friends about a satisfying experience and 20 friends for a negative experience.
 It is easier to influence existing customers to buy 10% more than increase the customer base by 10%.
 80% of successful new product and service ideas come from existing customers.
 Repeat customers cost 1/5th less than new customers and can substantially increase profits.
Some of the importance of CRM is:
1. Continuous Source of Revenue→ A better served and delighted customer gradually becomes loyal. Once
customer loyalty is built, the customer remains with the company and proves to be a permanent source of
revenue and profit.
2. Positive Referral Creation→ A satisfied customer often spreads positive things about the company to the
prospective customers. Such positive opinion proves to be more reliable and authentic than companies’
propaganda, including advertisements and consequently brings in more customers.
3. Provides Premium→ A customer satisfied with the service of a particular company is found to be ready to
pay a little premium on the products/services and does not want to take risk with a new company.
4. Helps Customer Retention→ Through personal & effective customer care and service, CRM helps the
company to retain customers for life. Retaining customers with the company helps in many ways.
5. Lowers Cost of Sale→ A satisfied customer does not require to be attracted every time by the company
and, hence, his subsequent acquisition cost to the company decreases. This helps the company lower cost of
sales.
6. Helps understanding consumer behavior→ By providing personal service to its customers, the company
understands the consumers and can adapt itself to their changing requirement. This also helps companies
offer a complete set of personalized solutions to customers.
7. Provides opportunity to cross-sell and up-sell → A satisfied customer is expected to come back to the
same company for repeat purchases. In case of any cross-sell and up-sell, he again comes back to the same
company and with no extra expense; the company is able to sell him for more products.
8. Reduces Marketing Time→ Through positive referrals and opportunities to cross-sell and up-sell, the
customer acquisition becomes easier and consequently leads to reduced marketing time.
TYPES OF CRM
1. Operational CRM→ It provides support to the front-office operations of an organization, such as sales and
marketing. Every interaction with customers provides information about them, such as customer contact
history. This information is stored in customer database for future references. Operational CRM helps
organization to track information related to customers.
2. Analytical CRM→ It helps an organization to analyze the collected information and take various product
related decisions. It analyzes customer information for various purposes, which are as follows:
a) Conduct marketing campaigns to improve marketing efficiency.
b) Execute customer campaigns, such as customer acquisition and cross-selling.
c) Analyze consumer behavior for making product-related decisions.
d) Make various management decisions, such as financial forecasting and customer profitability analysis.
3. Sales Intelligence CRM→ It is a tool used by an organization to optimize and evaluate key sales processes.
It helps salespeople to analyze information related to customers and take various sales decisions. It also
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 enables the organization to track available sales opportunities, enhance sales productivity, and provide better
customer service. This helps organization in maximizing their revenues.
4. Collaborative CRM→ It is an approach of managing customer relationships in which the various
departments of an organization, such as sales, marketing, and operations, share information that they collect
while dealing with customers. For e.g., the customer support department of an organization may share
customers’ feedback with the marketing department to determine the demand of products & services in the
market. The main aim of this collaboration is to improve the quality of customer service, which helps in
achieving a high level of customer satisfaction.

BRAND MANAGEMENT IN RETAILING

The term 'branding' is a very broad concept. It comprises of the entire effort in creating a unique space in the
mind of the consumers for the product of the company, through consistent advertising and promotion
campaigns. It can also be considered as the art of creating a brand. The very first motive of branding is to attract
and retain potential customers through developing and maintaining a unique position in the market.
According to American Marketing Association, "Brand is a name, term, sign, symbol, or design, or a
combination of them which is intended to identify the goods or services of one seller or a group of sellers and to
differentiate them from those of competitors".
Brand management in retailing (or retail branding) is not similar to branding. Branding is the process of
building a brand name based on what the brand stands for and what the retail firm desires to communicate to its
audience. Whereas, in retail branding, the aim of the retailer is to match its store's performance with branding.
Therefore, all the tangible and intangible attributes or benefits have to be delivered to the customers under retail
branding.
Types of Store Brands in Retailing
A significant role is played by the variety of products and merchandise carried by a store in not only grabbing
the attention of the customers, but also enhancing the image of the' .retail outlet. A fine mix of both private
brands and manufacturer's brands should be offered by the retailer in the retail outlet. The types of brands that a
retailer carries are:
1. National Brands/Manufacturers' Brands: National brands are called so because they are supplied all
over the country rather than a small area. They are also called non-store brands or manufacturer's brand.
There are some national brands which are sold all over the world along with selling within the domestic
country. Conversely, the private brands and regional (local) brands are sold by some people and are
available only in specific areas. However, it is not easy to sell a national brand as it requires a lot of funds
and only big businesses can afford that.
2. Local Brands: The scope of local brands is narrow. Their sales and marketing activities are confined to a
particular geographical location. As such, these brands are prevalent in a certain region or nation. When
these brands are marketed and sold in an area comprising more than a single metropolitan market, then they
take the form of regional brands. A brand created for a particular national market can also be local brand. It
is fascinating to know that the customers are more involved in branding of a local product or a business
than the manufacturers. For example, Van Heusen, Louis Philippe, etc., are local Indian apparel brands.
3. Private Label Brands: Private brands are produced and sold by a specific retailer. However, this feature
gives the retailer a differentiation advantage to stay ahead. In one way, it helps in promoting sales and
increasing profit margins. The other name for private label brands is store brands. The attributes and
specifications for the products under private labels are developed by the category managers and these are
manufactured through a third party. However, the entire responsibility of promoting those products lies with
the retailer.

Role of Branding in Retailing

The role of branding in retailing is given below:

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1. Improved Sales: Retail branding plays crucial role in improving the revenue and sales of the retail business.
Nearly fifty per cent increase in sales has been witnessed through retail branding. Moreover, through
branding, shoppers also get attracted to the offerings of the retail store. As a result, there is a rise in the
product sale.
2. Higher Price: Some customers are price sensitive. However, they do not care about the price, if the retail
brand is strong and the customers have developed an emotional attachment with it. As such, customers do
not switch brands instantly, even if the price of the strong brand increases. Therefore, it can be said that
customers are willing to pay higher price for strong brands as against weaker ones.
3. Higher Profitability: A strong retail branding in turn helps in a strong positioning of the brand in the mind
of customers. Therefore, large amounts of profits are generated by strong brands. This is also because
customers are not only ready to pay premium prices for strong brands, but they also visit stores frequently
and make more purchases. Moreover, a high market share, leading to a high return on investment, is also
enjoyed by strong retail brands. Therefore, higher profitability is the result of strong market position of a
retail brand.
4. Barriers against Competitors: It has already been discussed that through strong retail branding, a strong
position in the mind of customers can be achieved. Customers also have an emotional attachment with a
strong brand. This makes a strong brand stand out from rest of the retail brands in the market and such a
brand cannot be attacked by the rival retailers. After a certain amount of time, imitation of a strong brand
also becomes difficult. This makes the strong brand unique and distinct in the market.
5. Higher Customer Loyalty: A loyal and strong customer base is enjoyed by a strong retail brand. Customer
loyalty is the result of the customers' patronage and emotional attachment towards the retail brand.
However, it is not necessary that a degree of loyalty is the result of high retention rate. There may be several
other reasons for customer loyalty, like visiting stores out of habit rather than consciously or absence of any
other retail outlet in the area. In that case, loyalty is not active, but passive.
Branding Strategies in Retailing
Branding strategies in retailing are given below:
1. Integrated Branding: In this strategy, the retailer is directly involved with the manufacturer, right from the
generation of product idea to product branding. In this regard, adequate knowledge and awareness about the
future product developments is necessary to be possessed by the retailer. By this way, experience based
marketing is practiced and the direct association with the customers is taken advantage of.
2. Contract Branding: Contract branding can be regarded as the opposite of integrated branding. In this, there
is no involvement of the retailer in the development of the product, neither he/she is directly associated with
the manufacturer. The goods are just outsourced from an external supplier who is required to possess
adequate product knowledge and also is in direct contact with the manufacturer. Moreover, the
responsibility of product development is also on the supplier. The retailer is only responsible to
communicate specifications, like price, quantity, etc. The credibility, experience and network of the supplier
are taken advantage of by the retailer.
3. Independent Branding: In this branding strategy, retailers are titleholders of the brand and are also
responsible for the brand performance. Therefore, these brands are also called 'private labels.' Here, goods
are simply procured from suppliers at minimum cost possible and the entire investment in branding is to be
carried by the retailer. For example, SRC is a brand of Westside and Stop is a brand of Shoppers Stop.

MATERIAL HANDLING IN RETAIL STORE

Material handling is an integral part of all retail stores and accounts for 10-20% of the total cost of the selling
price. It is the way by which the goods of greater efficiency can be attained not only in stores but wherever
materials are moved. It is method for moving material.

Material can be moved either manually or with the help of slings, or other handling instruments. Material can
also be moved by people using machines such as forklift trucks, and other lifting fixtures (mechanical lifting). It
does not directly add value to the product but adds to the final cost.
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Thus material handling function includes all types of movements within the retail stores. These materials are of
various types, shapes and size. At each stage of selling materials are loaded and unloaded are travel widely
inside the store.

Each handling task poses unique demands on the floor staff. However, workplaces can help store staff to
perform these tasks safely and easily by implementing and upholding proper policies and procedures for
minimum and automatic materials handling resulting in reduction in handling costs.

Manual material handling operations are carried out in most retail stores because the goods comparatively
belong to FMCG sector and these are light in weight. But in case of electronics furniture/luxury retailing,
manual lifting can spoil the goods/items meant for sale. As when these items collide with each other, they can
create hazards that result in injuries.

A load may be hazardous because of the following reasons:

(i) Absent or inappropriate handles
(ii) Ill-shape (making it awkward to handle)
(iii) Imbalance (i.e., changing centre of gravity)
(iv) Improper temperature
(v) Size (very small/big)
(vi) Slippery or damaged surfaces and
(vii) Weight
The material handling job sometimes may be dangerous when it involves:
A. Lifting or lowering :
i. for extended periods of time
ii. immediately after prolonged flexion
iii. quickly/repetitively
iv. shortly after a period of rest
v. while seated or kneeling
B. Manual Materials Handling
C. Moving the load over large distances
D. Accuracy and utmost care required because of :
i. fragile loads, or
ii. specific unloading locations
E. Materials positioned too low or too high
F. Hazardous arrangements or postures
G. Multiple handling requirements (e.g., lifting, carrying, unloading)
Environmental factors that affect material handling are:
A. Noise pollution
B. Physical conditions
C. Poor provision for lighting (Artificial and/or Natural)
D. Relative humidity (beyond a 35-50% range)
E. Temperature (beyond a 19-26°C range)
F. Time restrictions (e.g., machine-paced work or deadline pressures)
i. obstacles
ii. floor surfaces (e.g., greasy, bumpy or damaged)
Worker characteristics that affect the handling of loads include:
A. General health includes:
i. height
ii. interest
iii. motivation
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B. Physical factors
C. Pre-existing musculoskeletal problems
D. Psychological factors include:
i. reach
ii. strength
iii. stress
iv. weight

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