A Presentation On

Retail Institutions: A Case Study on Shoppers’ Stop

Presented By:Shanu Kumar (2009MB0008)Neha Lohani (2009MB0009)Punam Raj (2009MB0012)Puja Taparia (2009MB0034)Megha Avinaw (2009MB0040)

Retail Institutions

A retail institution is the basic format or structure of a business. It plays a crucial role as retail institution directly contact with the consumers.

We examine retail institutions from the following three perspectives:OwnershipStore-based strategy mixNonstore-based retail strategy mix & nontraditional retailing

Retail Institutions by Ownership:

1.Independent An independent retailer owns one retail unit.Ease of entry: Low capital requirements

No or simple licensing provisionsLeads to intense competition

2.Chain A chain retailer operates multiple outlets under common

ownership ;engages in some level of centralized purchasing.Less expensive.

Retail Institutions by Ownership:

3.Franchising It involves a contractual arrangement between a franchisor

(a manufacturer, wholesaler, or service sponsor) & a retail

franchiseeThe contract allows the franchisee to conduct business under

an established name and according to a given pattern of business.Franchisee pays an initial fee & a monthly % of gross sales for using

exclusive rights to sell goods or services in an area.

4.Leased DepartmentIt is a department in a retail store-usually a department or specialty

store-that is rented to an outside party.It normally pays a % of its sales.

Retail Institutions by Ownership:

5.Vertical Marketing System It consists of all the levels of independently owned businesses along a channel of distribution.Goods & services are distributed through one of these systems: independent, partially integrated & fully integratedThree levels of firm: manufacturer, wholesaler, retailer

6.Consumer CooperativeIt is a retail firm owned by its customer members.A group of consumers invests, elects officers, manages operations, and shares the profits or savings that accrue.

Retail Institutions by Store-based Strategy Mix:A. Food-Oriented Retailers

1. Convenience Store It is typically a well-located, food-oriented retailer that is open for long hours & carries a moderate number of items.Average to above average price, ease of shopping.

2. Conventional SupermarketIt is a departmentalized food store with a wide range of food & related food products; sales of general merchandise are rather limited.

Retail Institutions by Store-based Strategy Mix:A. Food-Oriented Retailers

3. Food-based Superstore It is larger & more diversified than a conventional

supermarket but usually smaller & less diversified than a combination store.

4. Combination StoreIt unites supermarket & drugstore items or general merchandise in one facility.It is located in community shopping center or isolated site.

Retail Institutions by Store-based Strategy Mix:A. Food-Oriented Retailers

5. Box (limited-line) store It is a food-based discounter that focuses on a small

selection of items, moderate hours of operation, few services & limited manufacturer brands.

6. Warehouse StoreIt is a food-based discounter offering a moderate number of food items in a no-frills setting. It concentrates on special purchases of popular brands, offer little service, posts prices on shelves & locates in secondary sites.

Retail Institutions by Store-based Strategy Mix:B. General Merchandising

1. Specialty storeIt concentrates on selling one goods or service line, such as young women’s apparel.Most popular are apparel, personal care, auto supply, electronics, toys, books, jewelry etc.

2. Traditional department StoreIt is a large retail unit with an extensive variety of goods & services that is organized into separate departments for purposes of buying, promotion, customer service & control.

Retail Institutions by Store-based Strategy Mix:B. General Merchandising

3. Factory OutletIt is a manufacturer-owned store selling closeouts, discontinued merchandise, canceled orders and sometimes, in-season, first-quality merchandise.It straddles the line between wholesaling & retailing.

4. Variety Store It handles a variety of inexpensive & popularly priced

goods & services, such as apparel & accessories, costume jewelry, candy, toys etc. in the price range.

There are open displays & few salespeople.

Retail Institutions by Store-based Strategy Mix:B. General Merchandising

5. Membership Club It appeals to price-conscious consumers, who must

be members to shop there.

6. Flea Market At a Flea market, many retail vendors sell a range of

products at discount prices in plain surroundings.

Retail Institutions byNonstore-based retail Strategy Mix & nontraditional retailing:

1. Direct Marketing In Direct marketing, a customer is first exposed to a

good or service through a non-personal medium(direct mail, TV, radio, magazine, newspaper) & then orders by mail, phone, or fax-and increasingly by computer.

2. Direct Selling It includes both personal contact with consumers in

their homes(and other non-store locations such as offices) and phone solicitations initiated by a retailer.

Cosmetics, jewelry, vitamins, household goods & services, vacuum cleaners, & magazines, newspapers.

Retail Institutions byNonstore-based retail Strategy Mix & nontraditional retailing:

3. Vending machines A vending machine is a cash or card operated

retailing format that dispenses goods (like beverages) or services (like games).

It eliminates the use of sales personnel & allows 24 hour sales placing machines at places wherever convenient for consumers.

4. E-retailing or World Wide Web This is the most prevalent way of retailing via Internet.

Case Study:

Shoppers’ Stop

Started: October 27, 1991

Owner: K. Raheja Group of Companies, India’s biggest

hospitality & real estate player

Sister Stores: Crossword Bookstores, Home Stop, Brio,

Hyper City, Mother Care, Time Zone

Types of Retail outlets: Apparel, Footwear, Jewelry, Toys, Accessories, Fragrances, Cosmetics No. of Stores: 35

Marketing strategies

1. Guerilla Marketing It involves unusual approaches such as intercept encounters in

public places, street giveaways of products, any unconventional marketing intended to get maximum resultsfrom minimal resources.

2. Interactive Marketing (Customization)It is a strategies adopted by retailers where they allow customers to customize the product as per their preference. Shoppers‘ Stop is able to carve out this facility in a retail store. The concept that has already made a debut at Shoppers‘ Stop outlets in Mumbai, allows customers— who are referred to as guests— to go through various stages of activity in creating their own teddy bear (or other stuffed toy), including choosing a stuffed animal, stuffing it, giving it a heart, stitching, fluffing, naming and dressing it.

4 P’s of Shoppers’ Stop

Product: Identified the need for and created a suite of brands that reflect styles,

international class and fashion. Private brands have been introduced and developed after a careful analysis

of Customer Requirement. Shoppers Stop retails products of domestic and international brands such as

Louis Philippe, Pepe, Arrow, BIBA, Gini & Jony, Carbon, Corelle, Magppie, Nike, Reebok, LEGO, and Mattel.

Shoppers Stop retails merchandise under its own labels, such as STOP, Kashish, LIFE and Vettorio Fratini, Elliza Donatein, Acropolis etc.

The company also licensees for Austin Reed (London), an international brand, who’s men's and women's outerwear are retailed in India exclusively through the chain.

4 P’s of Shoppers’ Stop

Price:Shoppers Stop follows Premium Pricing Strategy that includes selling of High Quality Products at a High Price.

Place: Selecting the location for the store is in the hands of

retailers because before selecting the location they have to check many factors like walking traffic, competitor, parking, infrastructure, etc They also have to decide that they want to buy the site or they will take it on rent. So after deciding all these things they reach to the final decision.

4 P’s of Shoppers’ Stop

Promotion Communication Strategy – Reaching out to the

customers in their own style and languageDenim festival Customer Care associationFirst Citizen CardSurprise saleValentine sale

Thank Youany questions or suggestions

are most welcomed