5 Ws & 1 Hof

Retail Audits (Index)

INDIA

What is a Retail Audit (Index) ? Companies measure and track sales volume, distribution, selling price, promotions covering an organization’s own brands as well as the competitive set.

From category-level all outlet sales volume to single item performance in one market, Retail Index( Retail Audit ) provides manufacturers and retailers the complete view across all channels of trade.

Manufacturers need detailed insights into market dynamics in order to harness category opportunities and plan for the future.

Why is a Retail Audit (Index) done?Information about what is happening and how it is happening in over 70 lakh retail distribution points in India is needed.

The Retail Audit provides manufacturers and retailers the ability to:

1.Improve Category Understanding: Where are the opportunities for category growth?

2.Track Retail Performance: What is my market share and trends?

3.Manage Distribution: Where are the distribution gaps and opportunities? Are out-of-stocks an issue?

4.Analyze Promotion Efficiency and Effectiveness: Which product promotions have the most impact on the company / brand growth?

5.Evaluate New Launches: How much has the overall market share grown as a result of the new launch? What is the post-launch distribution build up in successful cases?

Where is a Retail Audit (Index) done?

• Urban and Rural regions across States in India.

• Various Retail Channels such as – Supermarkets , Hypermarkets ,Drug stores & pharmacies , Mass merchandisers , Convenience stores , Small independent grocers , Kiosks , Open Markets , Military commissaries , Liquor stores , Dollar stores , Pet stores , Warehouse-clubs

When is a Retail Audit (Index) done?

• Done on a MONTHLY Basis

• Yearly subscriptions are bought by companies

Retail Audit (Index)Categories in India

Who does a Retail Audit (Index) in India?

How is Retail Index measured?

• Data is based on measurement of consumer sales from a sample of outlets designed to reflect the channel being measured.

• The same fixed sample is audited on a monthly basis with field auditors physically counting retail stock holdings, then recording store purchases from any source (warehouse, wholesaler or direct).

• The ongoing measurement of these variables produces consumer sales as well as vital in-store information.

How is Retail Index measured? (Contd)

Retail Audit Measures:• Market size in terms of units sold, volume and value• Market share by volume and value• Numeric distribution• Weighted distribution• Share among handlers• Out-of-stock retailers• Per dealer off-take• Purchases by retailers• Stock levels with retailers• Stock turnover ratio• Trends for market, company, brand and SKU - for size and shares

How - The method1. Draft the research plans and schedule, indicating :

Scope and goals; Optimal sample size; Methods of collecting quantitative & qualitative data; Deadlines; Structure and format of reports.

2. Fine-tuning and approval of research approach.

3. Design and production of customized research tools.

4. Launch and management of field research (methods used : Observation , Face-to-face POS interviews , Mystery shopping)

5. Data collection : 3 basic groups:

a. White area

b. Grey area

c. Black area

6. Analysis and report writing

After verification, the data are punched in (software and formats to be determined based on client needs) structured, analyzed, and presented as text, graphics, customized databases, or a combination of these.

SAMPLE REPORT * Write on! Pens market in India

* Source : ACNielsen Audit Report 2006

Case Study Premium Toilet Soap Market in India

Case Study- Analysis• Brand A & Brand B are competitive Premium Toilet Soap brands, in the same price segment, with an All India presence. They are sold through both Traditional and Modern channels.

• However, at 7.5%, Brand B has a much higher Market Share in Modern Trade as compared to the 6.6% Market Share of Brand A.

• The difference in Share between Modern and Traditional Channel is also higher for Brand B - indicating that it is well leveraged in the Modern Trade Channel.

• This data illustrates that the fast growing Modern Trade Channel holds immense potential for Brand A to increase its Market Share.  How does Brand A go about it?  By concentrating on key markets

• A quick look at Sales by Segments for Toilet Soaps in Modern Trade Channel across 15 Cities reveals that Mumbai, Chennai and Hyderabad are the top three markets for Toilet Soaps. Besides, Consumers in these markets have a higher affinity to Premium Soaps.

• Hence, to begin with, Brand A should concentrate on servicing these three cities. This will help drive an immediate Market Share gain for Brand A.

This is a one-stop solution that helps marketers create strategies for their sustainable business development!

Thank YouPresented by:Annie – 214

Avishek Mukherjee – 217Rahul Grover – 242

S Anamika – 248Sanjib Paul – 251

Varun Gupta – 265Abhishek Sehra - 270