Functions Performed by Retailers

We will be performing all such activities which a retailer does. The ultimate objective of these functions is to give benefits to our target customers by providing them with good atmosphere and ambiance as well as all household required products at our royalty store. Generally, these functions are: 1. Providing Assortment We will be providing our customer with a variety of assortment in the groceries, kitchen ware and stationary so they can choose products, brands and sizes at one location and at one discount store with the quality service. 2. Breaking Bulk We will buy the merchandise in bulk from the wholesalers, thus, taking the advantage of economies of scale. But as a retailer we will offer the products in smaller quantities tailored to individual customers and house old consumption patterns. We will store the merchandise at one of the house nearby taken on rent. 3. Holding Inventory We will not hold large amount of inventory as we are new in the market it will increase the warehouse cost so we will be following just in time system for holding inventory. We will buy in bulk but only according to the requirement and demand. We will hold the inventory on at least one week. 4. Providing Services We will be providing quality customer services to our customer with a good environment in the store where they can easily find the thing. The merchandise will be displayed at convenient positions so that they can touch them before buying. We will also provide brochures to the customers at store regarding the merchandise along with their prices. This will help them to identify which products they are intended to buy. In case of any ambiguity our CSR will help them out. Proper training will be given to our CSRs. We will record complains of our customers and will fix it at the spot. We will also take regular feedback regarding our services and our sales staff. After successful working of store we will also plan to take orders on internet and provide home deliveries. All they have to do is to place their order online and then collect the merchandise. It will make our customers` life easier which is our ultimate goal.

Types of Retail Store

The retail Store which we planned to open is a discount store. The store will be located Abdul Haq Road near to doctor hospital johar Town that will offers a broad variety in merchandise and quality service. Firstly we will introduce national brands as they are known and afterwards when our discount store will be promoted and brand awareness will be created we will also introduce our private brand in the future. WHY a Discount Store The reason of our opening a discount store is that in Pakistan there are no proper discount stores. There are stores like CSD. But the environment and treatment with the customers are not very good. Even the merchandise offered is not of good quality and condition. So we have planned to open a discount store with a good and refreshing environment along with quality customer service and merchandise. When the ambiance of the store will appeal the customers, then people of all classes will visit the store. We are opening the store in this area because there is a very big untapped market which will be the people of johar town, Wapda town, Valencia, PIA & PCSIR society. Most of the people from these societies use this road. So everyone passing by the road will be our target market. So a discount store with quality service, product and discounted price will be effective in such an area.

Customer Buying Behavior

The discount store will fulfill the utilitarian needs of our customers. For such needs people require adequate information and an effortless shopping experience. Thus, our store is providing efficient and quality customer service at discounted prices. People will get the information about the store from both internal and external sources. People passing from the road will see the name and image of the discount store and will make a mind to inquire about it. People will also become aware from external sources which include SMS marketing, Brochures, Social Media, Sponsorships, Word of mouth and Direct mail services. People from societies like johar town, Wapda town, Valencia, PIA & PCSIR society educated and have a modern lifestyle. They will think that we can buy grocery from this discount store because they will be getting all things mainly grocery items under one roof. They will tend to compare our discount store with other stores. Thus due to convenience they will visit the store. As the store is near doctors hospital, the people who are going to hospital will also buy things like cokes, juices etc for the patient and their family. The main reason of planning to open the store in this particular area was to fill the gap in the market and provide then good quality household products for their daily usage.

Retail Marketing Strategy

A retail strategy is a statement identifying 1. The retailers target market 2. Format used to satisfy target market needs 3. The bases upon which the retailer plans to build a sustainable competitive advantage. Target Market

Our target market is the people of johar town, Valencia, wapda town and PCSIR society. There is no other discount store near this area so we have a first mover advantage in this place we can serve those people who have low income or middle income for their household. We are providing quality customer service along with discounted price which is our core competence. Retail Format

Retail Mix: Daily use household Items, kitchen ware, cosmetics, stationary and after we have created brand awareness in people we will be introducing private label brand also. Nature of Merchandise: We are providing products of daily household use like groceries, kitchen ware, and cosmetics, stationary. We will be also providing services to our customers like home delivery of products in the future who will become our regular shoppers and whose customer data base will be available to us. Pricing Policy: We buy our products from wholesale store so we give them on the actual price of the products with a little margin after promoting the store. Advertising and Promotion: We are advertising through distributing brouchers inside newspaper and also through social media and making website of our royalty discount store. Store design We will be having a grid store layout with different shelf space for different products. The grid store layout is well suited for customers who are primarily interested in the utilarian benefits offered by the store. Cash registers are located at the entrance of the store. They want to easily locate the product so that the customers can easily buy, make their purchase as quickly as possible. The grid layout is also cost efficient because less space is wasted. The use of high shelves for merchandise enables more merchandise to be on the sales floor compared with other layouts. Sustainable Competitive Advantage

We can achieve sustainable competitive advantage by the following points for our discount store and they are as follows:

Location The location which we have chosen is that where there is no as such discount store. And People have to visit the markets which are not very far from their houses. So Our Location near doctor hospital near johar town can be a cause of sustainable competitive advantage. The discount store is rare in Pakistan with such suitable conditions which we are providing to the customers. The location is such a competitive advantage which cannot be copied by anyone which is the biggest benefit of it. Human Resource Management Human resource management is an integral part of any business in the world. Mostly the retail outlets do not focus to train their employees and hire contract employees and this is the reason why most small retail shops or big retail shops fail. As we are all professional business graduates, we will train our employed to deal with the customers efficiently and effectively. Distribution and information system We will try to cut down our cost associated related to running of the business and we will be assuring that the right product category is available to our customers at the right place as well. Royalty discount store will be maintaining information system that will increase the efficiency of the store and by keeping the record of past purchases of our customer information we will be able to provide them the delivery of home product as well. We definitely will serve our customers in respectful manner and that can be a cause of competitive advantage. Customer service We will be giving superior customer service to our customers and this type of service which they will avail from our store will give them a reason to come again and again in the store. The trained staff will greet the customer with the smile to know them that they are here for their help or guidance. All staff will be trained according to the customer need. We will give free home delivery services for the regular shoppers in the future. We will be providing service to customers more then their expectations.

Strategic Retail Planning Process

Strategic retail planning process is the set of steps a retailer goes through to develop a strategy and plan. The strategic planning process of our discount store is as follows: Business Mission Our business mission is to provide groceries, cosmetics, kitchen ware and stationary items to our customers with an effortless shopping experience at discounted rates in our store. We will provide good ambiance and the merchandise in a logical sequence as per their need and requirement at convenient location. Our target market is the people who are living in johar town, Valencia, Wapda town and PCSIR society near doctor hospital. We will be marketing our

discount store through Websites, Brochures, Banner Along Road Side, SMS Marketing, Sponsorship Of
Events, Sales Promotion, Print Media (Flyers, Flexes, Billboard), Sales Personnel Uniform ( T-Shirt), Shopping Bags and Store Atmosphere

Conduct a Situation Audit After developing the mission statement the next step is to develop a situation audit. It is an analysis of the opportunities and threats in the retail environment and the strengths and weakness of retail business relative to its competitors. It includes the factors like market factors, competitive factors, environmental factors and analysis of strength and weaknesses. Market Factors

The market in which we are operating is of large size. Approximately 10,000 customers will get aware of the store and 10% will visit our store. There is a retail store at almost every corner of the street. The market is in growth phase. There is a lot of scope of retailing in Pakistan big stores like Hyper Star, Metro and Makro also the most rushy retail stores. Seasonality can also affect our business as ramzan is coming so the coke, breads and egg stock will be in the boom for this reason we should have a lot of resources in the seasonality. Competitive Factors

The competitive factors which will affect our discount store is the bargaining power of vendors and it will be high because as we are new in the market so the vendors will take time to trust on our discount store. So their bargaining power will be high. When the bargaining power of vendor is high they have the opportunity to dictate prices and other terms as well as it will reduce the retailer profit. The competitive rivalry will be low because there is no other discount store in that area. Environmental Factors

Environmental factors that can affect market attractiveness include technological, economic, regulatory and social changes. Environmental factors such as economy will affect our discount store because if there is inflation exists in the country the prices will get high and it will be difficult for us to maintain the prices which are prevailing in our discount store. In technological factor, we need to develop our discount store as it is working on excel. We need to develop software of our own at cash counters and for maintaining supply chain. In social changes the trends in demographics, lifestyles, attitudes, and personal values affect retailer market attractiveness. Analysis of Strength and Weakness

Strengths

We all three partners are Business Students and can handle the business effectively. As we are opening the discount store and that store is of our uncle so it will save our money and the rent will also be low due to family terms and conditions. Our Location is according to the need of the customers because there is no such discount store prevailing in that area so it will be beneficial for us and our customers also. We provide quality and reliable goods. We will try to establish strong relations with the public by creating brand awareness and brand loyalty. We as business graduates are Energetic to run the store effectively and have the skills and abilities so that we can manage the store effectively and efficiently. The people who pass johar town as well as other societies like Valencia, Wapda town and PCSIR will also be captured as our target market as well as the people who are going to visit the patients to doctor hospital. The ambiance would be up to the mark and the atmosphere of the store will provide the customers with a good shopping experience which mostly retail outlets neglect this thing.

Weaknesses We are new in the market so it will be difficult for us to get the attractiveness of customers We are fresh graduates so we have a limited experience in buying and purchasing things as well as how to build a strong relationship with customers. We have limited investment for our discount store. Our Target Market is limited. The trust of vendors will be low at the start of the business.

Identify Strategic Opportunities After completing the situation audit, the next step is to identify opportunities for increasing retail sales. We can increase our product line with the passage of time by increasing the assortment. We can go for private branding in the future for different products like Flour and pulses. In the future we can go for market penetration by increasing communication with our potential target customer We can also go for Market development by opening one more store in any other society. We can also go for joint ventures with different other store chains of our size to grow. We can also go for Online Retail store in the future as the trend is swiftly changing in Pakistan and people are attracted towards it. We will provide home delivery in future

Evaluate Strategic Opportunities The fourth step in strategic planning process is to evaluate opportunities that have been identified in the situation audit. The evaluation will determine our potential to establish a sustainable competitive advantage and reap long term profits from the opportunities being evaluated. For this

purpose we would be analyzing it more carefully and focusing on our strengths and our competitive advantage also. Establish Specific Objectives and Allocate Resources After evaluating the strategic opportunities, the next step in the strategic planning process is to establish objectives for each opportunity. The specific objectives of our business is defined in the mission statement and to achieved these objectives we need to have a performance review to be measured in our discount store, a time frame within which we will achieve that goal and the last thing we have to determine that how much the level of investment should be to achieve these specific goals. For example we are planning to give home deliveries and are allocating budget for Suzuki cars. Develop a Retail Mix to Implement the Strategy The sixth step in the strategic planning process is to develop a retail mix for each opportunity in which an investment will be made of the discount store and control and performance evaluation will be done at this stage in the store. Evaluate Performance and Make Adjustments The final step in the planning process is to evaluate the results of strategy and implementation program. If the royalty discount store is meeting its expected objectives then we do not need to change our strategic planning process but if we fail to meet our objectives of the store then for this purpose reanalysis is required for our discount store.

Retail Store Site Selection and Location

Our Location is a Abdul Haque Road near Doctors Hospital. Attractiveness of Region of Trade Area As there is no other discount store in johar town at this moment and which is rare in Pakistan and people hesitate to buy their products from discount store because their environment is not good and there is no customer service offered and they have to go far away to buy grocery products, so its an attractive trade area which can create huge demand for the business by creating awareness among people that will give you the quality service at affordable price near your home with good ambiance as well as working conditions. Residents of this area are educated and middle class families. So they belong to modern life styles at johar town, wapda town, and Valencia and pcsir society. As there is no other discount store in this block at the moment so there is no competition as such which we will going to face. Royalty discount store will be providing them with effortless experience of shopping in this type of discount store.

Attractiveness of Site Accessibility For our target market we have chosen the area of Abdul Haque Road near doctor hospital near johar town. The people passing by the road and going towards Valencia, wapda town, Ahbab Housing society and PCSIR society will create the traffic flow of customers. When the traffic is greater, more consumers are likely to stop at the store. Traffic counts are particularly important for retailers offering merchandise and services bought on to the store. We will create traffic flow in our location but it will be in positive sense that will draw customers to our store. Location Characteristics Parking Facility Our location characteristics are that we will be providing the customers with small parking facility. but at first it will be not too big but after creating awareness to our customers it will be increased with the passage of time or we will make underground parking facility. Visibility Visibility refers to customers ability to see the store from the street. As our store location is at the main road so it has a good visibility for the customers and it will be easy for us to create awareness among our customers through flex, sponsorship and social media.

Retail Mix
Retail Mix includes the entire element used by the retailers to satisfy its customer needs. The elements which we are using includes Type of Merchandise We are a general merchandise store so initially we will be offering groceries, kitchen ware, cosmetics and stationary. We will have products of all national brands and few international brands. There is also an opportunity for introduce private label brands once we attain the positive brand image. Variety We will have a broad variety of merchandise in general grocery. Items like sugar, flour, rice, salt, oil, ghee, beans, pulses, bread, eggs, russ, cheese, tea, coffee, butter, mayo, corn flakes and various brands of masalas, noodles, pickles, jam, jellies, ice creams, snacks, biscuits, chocolates, jellies, chips, squashes, instant juices, vinegar and other beverages will be available. Brands of tooth paste, shampoos, soaps, washing powders will be available. In kitchenware, we will have keep glasses and products of plastics like bowl and plates will be available. In cosmetics we will keep limited variety of basic products like beauty creams, scrubs, liner mascara etc. In stationary we will keep basic things like pen, pencils, rubbers, sharpeners, copies etc. We will assure the quality of these products and will also take order of those cosmetics which customer demands but are not available at the store and

Service Offered
The services which our store will offer include displaying merchandise accurately so that customers can easily touch the product. We will open the store at convenient timings like 6 A.M till 1 A.M. With time we will plan to make it 24 hours opened. We will be providing easy packing of the groceries purchased. It will be in eco friendly bags. We will not ask the customer to buy the bags first. We will arrange a jelly box and chocolate selection area for children where they will select the jellies of their choices. We will be providing quality customer service by training our CSRs. We will be communicating easy by telling our customers that this is our contact number please inform us if u have any complain regarding the grocery by saying that we will solve it by coming at your door steps. We will provide home delivery for the cosmetics ordered by the customers and will planning to do it for groceries as well. Prices and Cost of Offering Merchandise and Services As we are a discount store we will be offering products on a price lower than other stores. The discount will be on groceries. Our profit margins will be less but we are pursuing for high sales.

HR in Retailing
Objectives of HR in Retailing Main objective of HR is to align the activities and performance of employees with the short term and long term goals of the organization. The goal of our discount store is to give quality customer service so the goal of HR is to align our HR resource with our goal. Other objective of the HR is to develop Sustained competitive advantage. The activities and behavior of our store will differentiate with other stores. HR will also ensure the satisfaction level of the employees and will pursue to keep them effective performers. It will be the duty of HR to ensure to take continuous feedback from them to keep them loyal to the store. Keeping employees happy is far more important than keeping customer happy because these are the people who will directly deal with the customers. Developing proper training programs for the employees.

Designing Organizational Structure The retail structure of our store will be as follows

Owner-Manager

Store Manager

Merchandise Manager
*Merchadise Management *Advertising & Prmotion

Finance Manager

*Store Management
*HRM

*Accounts
*Financial Control

Salespeople

There will be decentralization in our retail store. Monthly meetings will be held with all the employees so collect feedback from everyone. Everyone will be given a chance to participate in the decisions about the store. The environment of the store will be participative.

There will be proper merchandising and store managing procedures. The CSRs will note the need of merchandise and will report it to the merchandise manager. We will be analyzing the customers demands and maintain a data. The data will discuss point like o How many SKUs of a product category were purchased? o How many are sold? o How many are available on shelf and in store

Special HR Issues in Retailing We will not hire part time workers at our stores. As handling part timers is difficult. The most difficult thing is to train according to the culture of the store. We will be facing problems in training our HR initially. As we are the university graduates, we will design proper training programs on biannual basis. We will also train them to deal with various demographics.

CRM Implementation in Retailing

The CRM process involves following steps

Collecting Customer Data Analyzing Customer Data CRM Programs

We will be collecting the customer data by at the cash counter. The cashier will be asking for the name and contact number of the customer. He will maintain a data base of names, contact numbers and their transactions. We can also collect the data by offering lucky draws for children. With the help of transactions of customers we will develop a customer pyramid ad divide the customers into platinum, gold, iron and lead. By identifying our platinum customers we will offer things like Rs 1000/- shopping free or so. We can also give them surprise gifts to keep them loyal to the store.

1. Buying Merchandise, Brand Decisions, Negotiation Strategies with Vendors After analyzing the buying behavior and purchasing pattern regarding different brands of target market residents, we opted to have all famous local and multinational brands along with few private label brands for generic goods. Our retail store will offer Nestle, Engro foods, Pepsi-cola, National, Shan, Mitchles, P&G and Uniliver brands. These all brands holds high brand equity and positive positioning. As a new retail store, we would need to develop store loyalty and image along with traffic. Pull strategy will be used to attract vendors after we have established a customer loyalty in few months time. In the beginning we would be focusing on simple gross margin along with long- term payment plans to increase the available cash. 2. Retail Communication Advertising Strategies with Vendors Advertising Brochures and TV cable ads: - we will advertise our store through brochures and banners placement in the target area. Newspaper distributors will be used for brochures distribution in the target area household. TVC are most effective in terms of reach and information flow to the target market, national channels will be too costly and less productive in nature. In order to increase the efficiency of TVC, cable operators private movie channels will be used to advertise our store. Sales promotion Rebates and premiums: - Sales promotion act as a complimentary to other sources of promotion, rebates on bulk buying will be offered to customers as per planned buying levels. Non-monetary premiums will be offered after few week time to customers that will have a profound impact on sales increase. Social media Social media campaigns have revolutionized the branding and promotion concept for marketers. Facebook page, twitter and instagram will be used to develop a close relationship with our target market and provide them with new information like new arrivals, sales promotion, rebates and other additions. Social media allows our customers to personalize with store.

3. Store Management Selection:Employee selection will be done on reference and background check Motivation and incentive (Profit sharing):Store manager job will be to motivate employees for greater efficiency and productivity. Employees can be both intrinsically and extrinsically motivated through appreciation, mentorship and profit sharing.
Inventory loss and energy cost management:Inventory shrinkage and loss are major concerns to be given high priority as a store manager.

4. Lay out Design and Visual Merchandise Grid layout Merchandise placement Impulse purchase items 5. Customer Service Empathy Responsiveness