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MUKUL MEHRA SUMMER INTERN P937 PGDBM 2009-11 SYDENHAM INSTITUTE OF MANAGEMENT STUDIES, RESEARCH AND ENTREPRENEURSHIP EDUCATION (SIMSREE)

Contents
EXECUTIVE SUMMARY...........................................................................................4 ABOUT PARLE AGRO PVT LTD................................................................................5 History...............................................................................................................5 Brands................................................................................................................5 1. 2. 3. 4. Beverages.................................................................................................6 Packaged Drinking Water.........................................................................6 Snacks......................................................................................................7 Confectionery...........................................................................................7

MODERN TRADE....................................................................................................9 Modern Trade v/s Mom-and-Pop Stores.............................................................9 Impact of Modern Trade on Agriculture in India...............................................11 Impact of Modern Trade on Employment in India............................................11 Impact of Modern Trade on Sourcing from India..............................................12 Governments Role in the Retail Revolution in India........................................12 Global Retail Industry.......................................................................................13 Worlds Top Retailers.......................................................................................14 The Far East Experience..................................................................................15 Modern Trade Various Retail Formats...........................................................17 Store Format by Location..............................................................................17 Store Format by Ownership..........................................................................19 Store Format by Merchandize Category........................................................20 Store Formats by Size...................................................................................26 Store Formats by Price..................................................................................26 Types of Store Layouts.....................................................................................28 Straight Floor Plan........................................................................................28 Diagonal Floor Plan.......................................................................................29 Angular Floor Plan.........................................................................................29 Geometric Floor Plan.....................................................................................29 Mixed Floor Plan............................................................................................30 Store Design....................................................................................................30 2|Page

Exterior Design.............................................................................................30 Store Front....................................................................................................30 Interior Design..............................................................................................30 Planogram.....................................................................................................30 Sales per square area......................................................................................31 MODERN TRADE @ PARLE AGRO PVT LTD...........................................................32 The Hierarchy...................................................................................................32 The Actual Trade..............................................................................................33 The Retail Giants..............................................................................................35 Big Bazaar and Food Bazaar.........................................................................35 D- Mart..........................................................................................................37 Spencers Hyper Market................................................................................38 HyperCITY.....................................................................................................39 Star Bazaar...................................................................................................40 More Megastore ABRL................................................................................41 Reliance Fresh..............................................................................................42 COMPETITOR ANALYSIS.......................................................................................44 Beverages........................................................................................................44 Packaged Drinking Water.................................................................................46 Snacks..............................................................................................................47 Confectionery...................................................................................................47 Offers on PAPL Products as well as Competitors Products..............................47 AREAS OF IMPROVEMENT AND SUGGESTIONS....................................................48 PAPL Products..................................................................................................48 Retail Outlets...................................................................................................52 CONSUMER BUYING BEHAVIOUR FOR SAINT JUICE (GREEN APPLE).....................54 Fruit Based Drinks Market................................................................................54 Brief on Saint Juice...........................................................................................54 Saint Juice Green Apple Study..........................................................................55 Areas of Improvement and Suggestions for Saint Juice Green Apple...............58 BIBLIOGRAPHY....................................................................................................59 BIBLIOGRAPHY

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EXECUTIVE SUMMARY
This project report is about the Summer Internship that first year MBA students undertake after the end of their first year. The project normally goes on till two months and involves working for an organisation helping them in their working or providing them solutions to problems they are facing. The two months of the project gives the students an exposure to a particular sector of the industry and helps them learn how an organisation works. It also gives them an exposure on how a department in an organisation like Finance, Marketing, Human Resources (HR), Operations, IT, etc work. I had the privilege to do my Summer Internship at Parle Agro Pvt. Ltd., a leading FMCG company in India. I worked for the Modern Trade Division of Parle Agro. My mentor was Mr. Ashish Shetye, an alumnus of SIMSREE and the Key Accounts Manager (KAM) at Parle Agro. During the project, I also worked with the Modern Trade team under the guidance of Mr. Gaurav Gautam who is the Business Development Manager (BDM) for the West Region and who reports to Mr. Ashish Shetye. He was the one who guided me on how the modern trade works at Parle Agro and also made me understand the nuances of retail industry and FMCG in particular. The project which was assigned to me was divided into four parts: Part 1: Understanding Modern Trade various parameters like stakeholders and their roles, relevance of each stakeholder, shadow working, observations from the market working, key parameters in modern trade, key account management, relationship management, SWOT and feedback. Part 2: Consumer Buying Behaviour for Different Formats (Hyper/ Convenience) identify consumer needs, relevance of Parle Agro offering in their basket and share of Parle Agro range Part 3: Impact of Consumer Promotions price off, multilevel pricing, free product and what is the consumer looking for? Part 4: Consumer Buying Behaviour and the Current Scenario for Saint Juice Green Apple in the market The summer internship project at Parle Agro was started on 3rd May 2010. For the first month, it was purely a field visit which comprised an observational research on how modern trade works as well as how Parle Agro works in modern trade in specific. The second month of internship comprises understanding the consumer buying behaviour for different formats of retail i.e. Hyper and Convenience. It also included understanding how sampling activities and promotional offers impact sales. I had to provide suggestions and key areas of improvement which would help Parle Agro increase sales.
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An additional one week study was done to understand the consumer buying behaviour for one of Parle Agros new products viz. Saint Juice Green Apple. I also had to provide suggestions to create awareness of the new product as well as solutions to boost sales of the new product.

ABOUT PARLE AGRO PVT LTD History

In the 1950s the undivided Chauhan family manufactured beverages, water, confectionery, biscuits, etc. under its registered brand name Parle. Over the years, the group split into three different companies Parle Agro, Parle Bisleri and Parle Products. Currently, all three are separate companies with separate ownership and management. They also have different products manufactured under them. All three companies continue to use the family trademark name Parle under which the current companies are named. Parle Agro commenced operations in 1984. Starting with only beverages and diversifying to include bottled water in 1993 and confectionery in 2007. Frooti was the first product that was rolled out of Parle Agro in 1985. It went on to become Indias favourite mango drink. Mr. Prakash Chauhan is the Executive Chairman of Parle Agro. Daughters of Mr. Prakash Chauhan, Schauana Chauhan is the Chief Executive Officer (CEO) and Nadia Chauhan is the Chief Marketing Officer (CMO) as well as the Joint Managing Director (MD) of Parle Agro. Parle Agro is a household name in the beverages industry and has leading brands like Frooti, consistent winner of India's fruit beverage brand, Appy, Appy Fizz, Grappo Fizz, an energizing lemon drink LMN and packaged drinking water, Bailley. A pioneer in the Indian industry, Parle Agro is associated with many firsts. They were the first to introduce fruit drinks in tetra packaging, first to introduce apple nectar and the first to introduce fruit drinks in PET bottles. In 2007, Parle Agro forayed into foods with the launch of two confectionery brands, Mintrox mints and Buttercup candies. This was soon followed by two more brands - Buttercup Softease and Softease Mithai. Recent beverage products from Parle Agro include Saint Juice, LMN and Grappo Fizz. In 2009, Parle Agro forayed into snacks with the launch of Hippo, in line with the companys vision of becoming a major player in the foods and beverages industry.

Brands
Parle Agro Pvt. Ltd operates under three business verticals: Beverages fruit drinks, nectars, 100% Juice, sparkling drinks
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 Water Packaged Drinking Water Foods confectionery, snacks 1. Beverages: Frooti: Launched in 1985 as a mango drink, Frooti is the first beverage to be launched in tetra packaging in India. Frooti is Indias favourite Mango drink and is ranked amongst the most trusted brands in numerous national surveys. It is available in 2ltr (Rs. 70), 1.2ltr (Rs. 45), 600ml (Rs. 25), 400ml (Rs. 20) and 250ml (Rs. 13) PET, 1ltr (Rs. 40) and 200ml (Rs. 10) tetra pack and 100ml (Rs. 10) TCA. Appy Classic: Launched in 1986 as apple nectar and originally available in a white tetra pack with an apple and leaf graphic, today it comes in black tetra packaging. Appy remains the first apple nectar to be launched in India. It is available in 1ltr (Rs. 40) and 200ml (Rs. 10) tetra packs. Appy Fizz: Launched in 2005, Appy Fizz is Indias first sparkling apple drink available in a champagne shaped PET bottle. Considered the Champagne of Fruit drink, Appy Fizz is a one of a kind product in the beverage market. Recently, Appy Fizz has been given a makeover in terms of a new packaging. It is available in 1ltr (Rs. 48), 500ml (Rs. 27) and 300ml (Rs. 20) PET bottles. Saint Juice: Launched in 2008, Saint Juice is available in three variants Orange, Mixed fruit, Grape and Apple. Saint Juice is 100% juice with no added color, sugar or preservatives. It is available in 1ltr (Rs. 95 for Orange, Grape and Green Apple, whereas Rs. 100 for Mixed Fruit) and 200ml (Rs. 20 for Orange, Grape and Green Apple, whereas Rs. 22 for Mixed Fruit) tetra packs. LMN: Launched in 2009, LMN is a fresh take on nimbu pani. It contains real lemon juice and has no artificial flavors or preservatives. LMN works as an Emergency Lemon Refresher, and tastes closest to authentic nimbu pani. It is available in 1ltr (Rs. 36), 500ml (Rs. 20), 250ml (Rs. 12), 200ml (Rs. 10) PET lbottles and 200ml (Rs. 10) tetra packs. Grappo Fizz: Launched in 2009, Grappo Fizz is a sparkling grape juice drink. Credited with creating the sparkling fruit drinks category in India, Grappo Fizz is along the lines of existing product Appy Fizz. It is purple-red in color and has no close competition in the market. It is available in 500ml (Rs. 27) and 300ml (Rs. 20) PET bottles. 2. Packaged Drinking Water: Bailley: Launched in 1993, Bailley is one amongst the first Packaged Drinking Water Brands in India and is counted amongst the top water brands. It is developed to cater to the Indian palate. Bailley is the first packaged drinking water brand which tied up with airlines to serve in-flight customers safe packaged drinking water. It is available in 2ltr (Rs. 65) Jar, 1ltr (Rs. 13), 500ml (Rs. 8), 200ml (Rs. 5) PET bottles and 200ml (Rs. 2.50) and 100ml (Rs. 2.25) Cups.
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3. Snacks: Hippo: HIPPO is a baked snack with the goodness of wheat. It is available in seven flavors from around the world - Italian Pizza, Chinese Manchurian, Hot-n-Sweet Tomato, Thai Chilli, Yoghurt Mint Chutney, Indian Chatpatta and Arabian Salted. These baked wheat munchies have no added MSG, no GMO, no cholesterol and zero trans-fat. It is available in 38gms (Rs. 10) and 52gms (Rs. 20) packs. 4. Confectionery: Mintrox: Mintrox is a hard mint candy. It is available in two flavors - Hard Cinnamon Mint and Hard Menthol Mint. It is available in 390gms (150 pieces for Rs. 75) Jar and on a per piece basis (Rs. 0.50). Buttercup Candies: Buttercup is a hard boiled candy; it is targeted at kids and adults alike. It is available in 390gms (150 pieces for Rs. 75) Jar, 260gms (100 pieces for Rs. 50) pouch and on a per piece basis (Rs. 0.50). Buttercup Softease: Buttercup Softease is a toffee which gives a uniquely chewy & smooth eating experience with a rich after taste. It is available in four variants Strawberry, Coconut, Vanilla and Caramel. It is available in 1.32kg (240 pieces at Rs. 240) Jar, 550gms (100 pieces at Rs. 100) pouch and on a per piece basis (Re. 1). Softease Mithai: Softease Mithai is a toffee. It is available in two flavours: Kaju and Kesar. It is available in 682gms (124 pieces at Rs. 124) Jar and on a per piece basis Re. 1).

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MODERN TRADE
Modern Trade (as defined by PricewaterhouseCoopers) is defined any organized form of retail or wholesale activity (both food and non-food under multiple formats), which is typically a multi-outlet chain of stores or distribution centers run by professional management. Its feasibility in India is no longer a question, even though India is one of the large Asian economies to liberalize its retail sector. Modern Trade has derived its name from the fact that this form of retailing has originated in recent times, say over the last 40-50 years. It is characterized by standardized store formats; air conditioned ambience, and variety in goods and lower pricing (in some cases). Mom-and-Pop stores fall under the category of Traditional Trade. Mom-and-Pop outfits are stand alone stores owned and managed by individuals and their families. They typically carry fewer goods (lesser variety), do not adhere to any uniform display format and goods are supposedly priced higher. It is, however, interesting to note that some of the biggest name in organized retail like WalMart or Tesco started their journey as a single (mom-and-pop) store.

Modern Trade v/s Mom-and-Pop Stores

India has always been a bastion of mom & pop stores. There are roughly 12 million retail stores in the country, which boasts the highest density of such stores anywhere in the world. Modern trade first made its appearance in the first few years following liberalization. Some of the textile companies like Raymond and Bombay Dyeing set up the first retail chains in the country. In recent times, one has seen the mushrooming of modern trade with a host of companies from different spheres setting up organized retail outlets. There has also been an outpouring of angst from politicians and others who are of the socialist persuasion about how Goliathlike organized retail chains can undermine the livelihood of hundreds of thousands of small mom & pop retailers also known as kirana stores. In some places in the country, this angst has also manifested itself in the form of attacks on the organized retail stores and forcible closure of some of these outlets. In August 2007, all organized retail outlets in Uttar Pradesh especially those belonging to Reliance and Spencers were compelled to close down. In the light of these events, the powers that be may want to dig deeper and do a reality check on the situation at the ground level. The issue of organized retail versus mom & pop stores has been deliberated quite exhaustively in countries like the USA and UK. Modern trade was established in these countries about 3 to 4 decades ago. Wal-Mart which has become the poster child of modern trade anywhere in the world started operations in 1962 when Sam Walton set up his first discount store in Rogers, Arkansas. Today Wal-Mart has more than 4000 stores in the USA
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and apparently holds a market share of 20% of all retail trade. In the UK, another organized retailer, Tesco has a similar presence with more than 2000 stores.

Modern trade arguably accounts for 50% of all retail grocery and consumables business in the developed markets but this has been achieved over a period of 40 years since the first organized retails stores made their appearance in the country. India has a long way to go before it reaches this juncture, probably longer than the political careers of most of the protagonists who are trying to make a livelihood by pitting the Davids against the Goliaths. Today the contribution of modern trade is merely 9% of the total retail trade in the country. Modern trade bashers also do not have a realistic understanding of the competitive advantages that kirana stores have at their disposal. Kirana stores offer the customer convenience at several levels i.e., proximity, credit facility, home delivery, etc. which organized retail stores find difficult to replicate. Unlike the Americans, Indians do not have the culture of driving down several miles to a retail outlet to accomplish grocery shopping. Most customers shop at a mom & pop store that is a stones throw from their homes a luxury that can never be provided by their organized counterparts. Neighbourhood kirana stores also offer customers short-term credit facility, which is possible because of the close relationship that the shop owner enjoys with the customers. Organized retail stores cannot provide credit since they dont know the customers as well. The mom & pop stores offer home delivery even for small orders and single items. The delivery boys are almost always the shop owners children or relatives. Organized retailers do not encourage home delivery for small order quantities, as it would impact their profitability. Some of the benefits that modern trade has traditionally offered such as lower pricing to customers (owing to better bargaining power), large format stores that can offer infinite variety to customers etc are yet to be proven in the Indian context. Rising real estate costs and employee compensation (compared to kirana stores) are nullifying these competitive advantages that modern trade has traditionally enjoyed in some of the developed countries. None of the above issues are severe when compared with the latest nemesis of organized retail trade, which are the global financial crisis and the subsequent economic downturn. Some organized retail chains are going through a liquidity crisis and do not have sufficient working capital to keep their stores adequately stocked. Regular customers are finding their favourite shelves empty and may not keep coming back. If recent reports are to be believed, the reduced demand and racketing costs are forcing many of the organized retail chains in the country going to consolidate their operations. This is probably a euphemism for closure of stores, retrenchment of staff and rolling back expansion plans.
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Opponents of organized retail frequently quote the American example where the Wal-Marts of the world sounded the death knell for the mom & pop stores. In India the ground reality is obviously very different. The kirana stores are a part of the community and seem to be here to stay.

Impact of Modern Trade on Agriculture in India

Due to the presence of large local and multinational companies, India has a fairly organised and developed non-food manufacturing supply chain. However, India continues to lack in last-mile distribution1 segment. The food supply chain in India remains fragmented and unorganised. The impact of supply chain effectiveness will mainly be on the agriculture sector. The organised food retail business is among the least developed in India. If one looks at the Indian food chain, from farm to fridge, distribution of most food items involves multiple intermediaries and wastage during transportation and storage. The cumulative wastage across the supply chain can vary from 24% to 40%. Development and growth of modern trade in India will result in the disintermediation of the food supply chain as well as investments in upgrading the technology and practices in the entire value chain. This will reduce wastage and duplication of efforts resulting in farmers realising both higher productivity and better price. At the same time, consumers will get a wider variety and better quality products at relatively lower prices. The Government too needs to bring in appropriate legislative changes to catalyse this transition in the food supply chain. International modern trade players like Metro significantly invest in their operations in transitional economies. In the process of expanding operations, they make a huge difference to the lives of farmers and small-scale vendors by teaching them new techniques to improve productivity and providing them with new market access for their products.

Impact of Modern Trade on Employment in India

Today 21 million people are employed in the retail sector in India, which is 7% of the total national workforce. As retail is largely labour-intensive, various studies (based on the level of investment envisaged in the near future), have predicted generation of an additional 8 million jobs. Over 40 million square feet of retail space have been created. Modern trades effect will be most apparent at the bottom of the population pyramid, as it will unleash opportunities such as non-agricultural employment to rural youth and better quality of living for the existing agricultural society. At present 72% of the Indian population lives in the villages and is employed in agriculture.

1 Last Mile Distribution means the final leg of delivering goods to a customer.

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The traditional mom-and-pop stores in India cater for 97% of the total market and have developed indigenous processes and skills in retaining their customers, thanks to their unparalleled proximity, convenience and services offered. Taking a cue from their competitive advantage, modern trade companies in India will have to reach the existing service levels and match the Indian consumers expectations. This will happen partly with the adoption of better processes and technologies, but also through creation of fresh employment. Global retailers like Carrefour and Kingfisher have already invested significantly in the local economies they are present in. In the process, they have improved living standards of consumers, suppliers, farmers and employees and generated greater quantity and quality of employment. It can be expected, from the trends in China and Mexico that with flourishing modern trade and increasing global retailer presence, domestic competitors will still hold majority stake in the Indian market. In China, Carrefour and Wal-Mart have more than 100 stores, despite which domestic competitors hold more than 90% of the market. Similarly in Mexico in spite of the presence of global retailers including WalMart, the number of retail outlets, including mom-and-pop stores, increased by 2%. Global retailers have already been sourcing from India and their retail presence in the Indian market will enhance exports from India, as they develop and leverage relationships with local suppliers. As China opens up to greater retailer demand following the end of the quota system of the Agreement on Textile and Clothing, it may face capacity constraints for certain product categories. Existing customers may then be forced to switch sourcing from China to other countries. India and other Asian countries will benefit from these developments. The extent of sourcing from India will grow manifold when global retailers are allowed to operate in the Indian market. Modern trade creates vital market access for small-scale suppliers and imparts necessary training and investments in improving their productivity and in adopting best practices. Wal-Mart is keen on sourcing food and dairy products from India. To this effect, Wal-Mart is ready to bring in high-end technology, invest in cold chains and address issues such as contract farming. Wal-Mart already sources goods worth $125 million a year from Punjab alone, mainly cotton. The most effective way for Wal-Mart to increase the volume and range of goods sourced from India, however, is to have retail stores in the country. Wal-Mart is currently present in India under a 50:50 joint venture with Bharti Enterprises in the wholesale cash-and-carry segment. Wal-Mart's impact on local business is based on the philosophy of operating globally and giving back locally. Nurturing local fresh producers have already had a very positive impact on modernising and enhancing the food value chain.

Impact of Modern Trade on Sourcing from India

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Governments Role in the Retail Revolution in India

The availability of an adequate infrastructure is necessary to keep pace with the current retail transformation and to meet the challenges of future growth. The major infrastructure required for moving goods efficiently from one place to another involves roads, the freight industry, railways, ports and shipping and pipelines, all of which are either managed or regulated by the Government. The connectivity and quality of and costs incurred in developing better infrastructure should be improved. In 2006, the Government for the first time eased retail policy in the country by allowing up to 51% FDI through the single-brand retail route. Since then there has been a steady rise in FDI in retail sector. The cumulative FDI in single-brand retail stood at $190 million in February 2010. From 2006 to March 2010, around 94 players applied to invest through the single-brand route, of which 57 entities got approval. US retail giant Wal-Mart is lobbying with the Indian and US Governments to persuade India to relax the rules prohibiting investment in consumer facing multibrand retail channels. If successful, this would be a major foreign direct investment inflow into India, which has become a major FDI magnet amongst the developing nations.

Global Retail Industry

The latter half of the 20th Century, in both Europe and North America, has seen the emergence of the supermarket as the dominant grocery retail form. The reasons why supermarkets have come to dominate food retailing are not hard to find. The search for convenience in food shopping and consumption, coupled to car ownership, led to the birth of the supermarket. As incomes rose and shoppers sought both convenience and new tastes and stimulation, supermarkets were able to expand the products offered. The invention of the bar code allowed a store to manage thousands of items and their prices and led to 'just-in-time' store replenishment and the ability to carry tens of thousands of individual items. Computeroperated depots and logistical systems integrated store replenishment with consumer demand in a single electronic system. The superstore was born. On the Global Retail Stage, little has remained the same over the last decade. One of the few similarities with today is that Wal-Mart was ranked the top retailer in the world then and it still holds that distinction. Other than Wal-Marts dominance, theres little about todays environment that looks like the mid-1990s. The global economy has changed, consumer demand has shifted, and retailers operating systems today are infused with far more technology than was the case ten years ago. Saturated home markets, fierce competition and restrictive legislation have relentlessly pushed major food retailers into the globalization mode. Since the mid-1990s, numerous governments have opened up their economies as well, to the free markets and foreign investment that has been a plus for many a retailer. However, a more near-term concern, has been the global economic slowdown that has resulted from dramatic cutback in corporate IT
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and other types of capital spending. Consumers themselves have become much more price sensitive and conservative in their buying, particularly in the more advanced economies. From an operational point of view, active practitioners have voiced their opinion that retailer concerns in 2003 have turned to deflation, lack of pricing power, global over-capacity, low interest rates, economic stagnation, slump in world tourism and declining consumer confidence. But, even before the global economic slowdown that forced retailers into monitoring costs more effectively, technological advances were a way of life in retail organizations. Technology has become the real enabler for retailers over the last six years. Supply chain innovations for retailers were particularly strong in the second half of the 1990s and have continued into today. With all the emphasis on technology and cost-cutting, a major thrust of retailers continues to be demand-based: finding new markets through globalization efforts. Four years ago, more than half (53 per cent) of the top 200 retailers operated in one country only. Today, only 44 per cent remain single-country merchants. This globalization trend can only intensify in the years ahead. The benefits of increased sales and greater economies of scale are too large to be ignored. The global retail industry has travelled a long way from a small beginning to an industry where the world wide retail sales alone are valued at $ 7 trillion (Source: 2003 Global Retail Report, Deloitte Touche Tohmatsu). The top 200 retailers alone account for 30% of worldwide demand. Retail sales being generally driven by peoples ability (disposable income) and willingness (consumer confidence) to buy, compliments the fact that the money spent on household consumption worldwide increased 68% between 1980 and 2003. The leader has in-disputably been the USA where some two-thirds or $ 6.6 trillion out of the $ 10 trillion American economy is consumer spending. About 40% of that ($ 3 trillion) is spending on discretionary products and services. Retail turnover in the EU is approximately Euros 2000 billion and the sector average growth looks to be following an upward pattern. Positive forces at work in retail consumer markets today include high rates of personal expenditures, low interest rates, low unemployment and very low inflation. Negative factors that hold retail sales back involve weakening consumer confidence.

Worlds Top Retailers

1. Wal-Mart, USA Formats Discount Hypermarket, Supermarket, Superstore, Warehouse Countries of Operation- USA, Canada, Argentina, Brazil, China, Germany, Mexico, UK, South Korea and Puerto Rico 2. Carrefour, France Formats Cash & Carry, Convenience, Discount, Hypermarket, Supermarket Countries of Operation France, Argentina, Belgium, Brazil, Chile, China, Columbia, Czech Republic, Greece, Indonesia, Italy, Japan, Madagascar, Malaysia,

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Mauritius, Mexico, Morocco, Oman, Poland, Portugal, Qatar, Romania, Singapore, Slovakia, Spain, South Korea, Switzerland, Taiwan, Thailand, Turkey and UAE. 3. Royal Ahold, Netherlands Formats Cash & Carry, Discount, Drug, Convenience, Hypermarket, Specialty, Supermarket Countries of Operation Netherlands, Argentina, Brazil, Chile, Costa Rica, Czech Republic, Denmark, Ecuador, El Salvador, Estonia, Guatemala, Honduras, Indonesia, Latvia, Lithuania, Malaysia, Nicaragua, Norway, Paraguay, Peru, Poland, Portugal, Slovakia, Spain, Sweden, Thailand, USA 4. Home Depot, USA Formats DIY, Specialty Countries of Operation USA, Canada, Mexico, Puerto Rico 5. Kroger, USA Formats Convenience, Discount, Specialty, Supermarket, Warehouse Countries of Operation USA 6. Metro AG, Germany Formats Cash & Carry, Department, DIY, Hypermarket, Specialty, Superstore Countries of Operation Germany, Austria, Belgium, Bulgaria, China, Croatia, Czech Republic, Denmark, France, Greece, Hungary, India, Italy, Japan, Luxembourg, Morocco, Netherlands, Poland, Portugal, Romania, Russia, Slovakia, Spain, Switzerland, Turkey, UK, Ukraine, Vietnam 7. Target, USA Formats Department, Discount Countries of Operation USA 8. Kmart, USA Formats Discount, Superstore Countries of Operation USA 9. Sears, USA Formats Department, Mail Order, Specialty Countries of Operation USA, Canada, Puerto Rico 10. Tesco, UK Formats Convenience, Department, Hypermarket, Supermarket, Superstore, Specialty Countries of Operation UK, Czech Republic, Hungary, India, Malaysia, Poland, Ireland, Thailand, South Korea, Slovakia, Taiwan, Thailand, USA

The Far East Experience

The Food Retail Industry in the Far East has evolved into what could be called the breeding ground for emerging models with countries like Singapore being the home to some of the big players in the industry in these parts of the world. The presence of all the major players of the retailing industry is found in Singapore. Singapore has 2 hypermarkets, one run by
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Carrefour and the other by Giant Hypermarket, part of Dairy Farm International. According to the government, there are slightly more than 11,000 market stalls operating in 150 markets located all across Singapore Island. The markets further spread to China, Thailand, and Malaysia thanks to the major support that the local governments provided in creating the necessary regulatory framework in establishing their presence. Singapore, Malaysia and Thailand not only fuelled the retail industry within the country, but also attracted hordes of tourists to experience the shopping experiences that they created in these islands. The markets are now saturated with no additional space for a new entrant and are expected to consolidate within the next few years. Apart from Singapore, which is a more recent development, Japan enjoys an active spot on the retailers map. The retail industry is as huge as US$ 1088 Billion, with a split of US$ 594.8 Billion in the non-food segment and US$ 493.2 Billion in the food-retailing sector. The leaders in sales are Ito-Yokado, Aeon, Daiei, Takashimaya, and Uny, in that order. Several retailers, however, have made recent improvements in their warehousing and distribution technologies to make their presence felt in the Japanese market. Convenience stores, which are small and suitable in a country where land is very expensive, continue to do well. Food, in fact, has been one of the few sectors that have experienced growth over the last several years. A period of shake up in the industry is likely now that Wal-Mart has entered Japan. Numerous smaller, less efficient retailers may become takeover targets. The entire Japanese retail sector will likely undergo some form of restructuring over the next decade as a result of overcapacity, dismal profits and the Wal-Mart factor. In Mainland China, the retail markets have mushroomed over the years of intense economic development to a very considerable size. The total volume of retail sales for consumer goods and food increased by 10.6 percent in China over the last couple of years which shows tremendous growth. Consumer spending has held strong. A decade ago, the top five retail enterprises in China were all traditional merchandise companies, but now the top five are mainly supermarkets and chain stores. The world is enamoured with Chinas potential and opportunities. But in medium-sized and small cities and rural areas, traditional retailing methods, such as department stores and local retailing networks, will be sufficient, as consumption is lower. In Indonesia, Wet markets and Supermarkets remained the major distribution channels for food products. Although these retail sub-sectors also offered non-food products, such as household goods, food products remained dominant in terms of the number of items. Wet markets distribution of food products tended to be much greater than non-food as these retail channels mainly provided fresh produce. Conversely, supermarkets had an almost equal distribution, with food taking up the greater proportion. On the other hand, the distribution of non-food products benefited from both food and non-food retailers. For example, some food retail formats offered non-food items, such as supermarkets, hypermarkets, and convenience stores. These retail outlets provided some basic non-food products, such as toothpaste, soap, or detergent. However, non-food retail outlets rarely provided food items, except certain department stores or druggists.
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In Malaysia, a majority of food retailer outlets offer food and non-food items, with at least a 70:30 distribution. The traditional food distribution system in Thailand is through so-called 'wet markets' which sell fruits, vegetables, meat and fish, together with small 'mom and pop' food stores which distribute dry goods. However, the rapid growth of the economy, particularly during the decade before the financial crisis began, has led to dramatic changes in the structure of the food-retailing sector. Modern supermarkets, superstores, hypermarkets and convenience stores developed at breakneck pace to service the growing middle class with their demand for more sophisticated food stores and a greater variety of products many of which were imported.

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Modern Trade Various Retail Formats

Store Format by Location 1. High Street Format: Such stores are located in busy shopping areas. Area occupied by such stores is less than 200 square feet. No parking facility available. Focussed Merchandize Category. Example: M.G. Road in Bangalore.

Hi gh Street Format M.G. Road, Bangalore

1. Destination Format: Huge Parking Space.

Wide Merchandize Category. Independent retail store with alluring proposition for the customer to visit the store with the primary intention of shopping there. For Example, HyperCITY

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HyperCITY, Malad 1. Convenience Store Format: Located in the catchment area of target customers. Extended hours of operation. Less than 5000 square feet. 24x7 convenience stores situated close to homes to generate high footprints. Snacks, Grocery type items and Confectionary Merchandize include beverages, ready to eat foods.

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These stores carry a limited stock of daily use of goods with a special focus on food products. For example, In and Out petrol pump outlets.

Convenience Stores in Japan and USA respectively 1. Chain Store Format: It is multi-locational. Operates in multiple outlets under common ownership. Engages in some level of centralised or co-ordinated purchasing and decision making. For Example, Shoppers Stop, Croma.

Croma Store

Store Format by Ownership 1. Franchise Format: A franchise is a form of contractual channel in which on party, the franchisor, controls the business activities of another party, the franchisee.

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An eligible franchisee agrees to pay for the right to use the franchisors business methods and other important business aspects, such as the franchise name. Payment is usually in the form of one-time, upfront franchise fee and also ongoing percentage of revenue. While the cost of franchise may be quite high, it offers advantages such as allowing the franchisee to open a retail outlet that may already be known to local customer and being trained in how to operate the business, which may allow the franchise to be successful much faster than if they attempted to start a business on their own. For Example, McDonalds outlets are franchisee owned. Hard Castle Restaurants Pvt. Ltd. Handle the West and South Operations and Connaught Plaza Restaurants Pvt. Ltd. Handle the North and East Operations.

McDonalds India 1. Independent Store Format: It is a retail store owned by a single person or a partnership, and not operated as part of a larger retail institution. 50% of these are run by owners and their families. There is a lot of flexibility in formats, locations and strategy. There is total control over investment costs and personnel functions. Strong entrepreneurial leadership is needed to run such stores. However, there are some disadvantages also such as lack of economies of scale, labour intensive operations, over dependence on owner and limited long run planning. For Example, Amarsons, Premsons.

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Amarsons, Mumbai

Store Format by Merchandize Category 1. Specialty Store: Specializing in a given type of merchandize. Consortium of retailers that carry a certain category of products. They are usually situated some distance from the city centre. Consumers have to make a special visit to pick up the goods. For Example, Relaince Jewels, Reliance Trends

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Reliance Jewels A specialty store 1. Department Store: Large retail store offering a variety of services and merchandise organized in separate departments. Occupy prominent positions in the heart of town or as anchor stores in out-oftown malls. For Example, Shoppers Stop, Big Bazaar.

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Shoppers Stop

Big Bazaar

1. Supermarket:

A store that sells a wide variety of goods including food, medicine and household products. Often part of a chain that owns or controls other supermarkets in the same or other towns; thus going for economies of scale. The chains are often supplied from the distribution centres of a larger business. For Example, Food Bazaar, Lifestyle.

Food Bazaar

Lifestyle

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1. Hypermarket: A store that combines a supermarket and a department store. A gigantic retail facility that carries a big range of products under one roof, including fresh groceries and apparel. When planned, constructed and executed correctly, hypermarket caters to all routine weekly shopping needs in one trip. Size is more than 200 square feet. For Example, Star Bazaar, Spencers, HyperCITY.

Star Bazaar

Spencers

1. Category Killers: Large format stores that specialize in a narrow line of merchandise. They use their buying power to negotiate low prices and excellent terms and assured supply when items are scarce. For Example, Vivek, Vijay Sales, Mega Mart.

Vijay Sales, Mumbai 1. Seamless Malls:

Mega Mart, Chennai

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Consortium of retailers without walls separating the individual stores. One enormous shop, with hundreds of popular brands sharing space with each other. For Example, Pantaloons Central Mall.

Central Mall, Gurgaon

1. Outlet Malls: Shopping centre with national brand-name retailers selling discounted merchandise. For Example, Huma Mall.

Huma Mall, Mumbai

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1. Lifestyle Centres: Shopping centre or mixed-used commercial development that combines the traditional retail functions of a shopping mall but with leisure amenities oriented towards upscale consumers. Shopping centers or malls whose array of retail outlets are designed to appeal to a particular segment of the population. Typically, lifestyle centers feature upscale specialty stores, services, and restaurants. For Example, Greenwood Park Mall Lifestyle Centre, Indianapolis, USA, Centrestage Mall, Noida, India.

Greenwood Park Mall, USA

Centrestage Mall,India

1. Discounters: Discounters or Discount stores are types of department stores which sell products at prices lower than those asked by department stores and other traditional retail outlets. They are not variety stores, which sell goods at a single price-point or multiples thereof. They differ from variety stores in that they sell many namebrand products, and because of the wide price range of the items offered. They offer much less category of goods and stock only a limited selection of items, typically fewer than 1400 SKUs2 , compared to the 15000 plus items carried in most supermarkets. They offer few or no manufacturer brands. Their assortment is dominated by private labels whose quality is often as good as that of leading national brands.
2 SKU Stock Keeping Unit is a unique identifier for each distinct product and service that can be purchased.

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Above all, the prices are very low. They can be up to 60% lower than the price of leading name- brands, and as much as 40% lower than traditional retailers private-label products. For Example, The Loot Store, Future Groups Brand Factory.

The Loot Store

Brand Factory

1. Internet Retailing: It is shopping through the internet and other media forms. Online payment system through credit card. Customers are assured that the products they buy online would reach them in time. Products are offered at discounted rates. People in India are not so used to online shopping as the payment system through the credit card is still alien to them. Retail companies have resorted to private guaranteed courier services as compared to postal services. For Example, ebay, indiaplaza.
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Store Formats by Size 1. Superstore Format: This format is a single level large store, twice the size of a supermarket, offers non traditional goods and services like pharmacy, flower shop, bookstore, salad bar, bakery, etc 2. Shopping Mall: It is spread over a large area. There is a well defined arrangement of retail stores and there are also places for leisure activities. 3. Shopping Centre: It is a plaza combining five or more tenant spaces developed under one building. 4. Hypermarket: It has a wide variety of products which are offered in large quantities. Each category of product is sold in huge volumes at low margins. Store Formats by Price 1. Discount Format: It follows a bazaar format where discounts are given more often. For Example, Big Bazaar, DMart.

DMart 2. EDLP (Every Day Low Pricing) Format: This format specializes in a particular merchandize line, assuring consistently low prices. For example, Wal-Mart.

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Wal-Mart, USA 3. Category Killer Format: It is a large specialty store having enormous selection of its product category at relatively low prices. For Example, Mega Mart, Vijay Sales. 4. Factory Outlet Format: It is owned and operated by the manufacturer. Nike Factory Outlet Store.

Nike Factory Outlet Store

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5. Warehouse Format: It offers a large sale of discounted merchandise and has a large width and depth in many categories in retail. 6. Single-Price-Denomination Format: It scrambles all its merchandize at just one price point, generally a lower one. For Example, Dollar Store.

Dollar Store, USA

Types of Store Layouts

A well-planned retail store layout allows a retailer to maximize the sales for each square foot of the allocated selling space within the store. Store layouts generally show the size and location of each department, any permanent structures, fixture locations and customer traffic patterns. Each floor plan and store layout will depend on the type of products sold, the building location and how much the business can afford to put into the overall store design. Below are a few basic store layouts. Straight Floor Plan

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The straight floor plan is an excellent store layout for most any type of retail store. It makes use of the walls and fixtures to create small spaces within the retail store. The straight floor plan is one of the most economical store designs. Diagonal Floor Plan

The diagonal floor plan is a good store layout for self-service types of retail stores. It offers excellent visibility for cashiers and customers. The diagonal floor plan invites movement and traffic flow to the retail store. Angular Floor Plan

The angular floor plan is best used for high-end specialty stores. The curves and angles of fixtures and walls make for a more expensive store design. However, the soft angles create better traffic flow throughout the retail store.

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Geometric Floor Plan

The geometric floor plan is a suitable store design for clothing and apparel shops. It uses racks and fixtures to create an interesting and out-of-the-ordinary type of store design without a high cost. Mixed Floor Plan

The mixed floor plan incorporates the straight, diagonal and angular floor plans to create the most functional store design. The layout moves traffic towards the walls and back of the store.

Store Design
It tells the customers what the store is all about. It creates an image in the minds of the customers. For a customer, store needs to be easy to navigate; it must appeal to his sensory perceptions and must create a sense of belonging and relationship. The environment created is a combination of exterior look, store interiors, the atmosphere in the store and the events, promotions and themes which form a part of a retail store. Exterior Design The exterior design is the function of the location of the store site and other facilities like parking and ease of access.
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Store Front The store front is another important factor. It should be inviting and it should have a good lighting and other facilities in total it should entice potential customers into the store. Interior Design The interior store design is the function of aesthetics within the store, the merchandise sold within, the space used and the overall layout of the store. Planogram A Planogram is a marketing tool used in retail stores. It is a diagram or drawing that provides details as to where a product should be placed on a shelf and how many faces that product should hold. A planogram is used by the store to increase sales. A retail store will either hire a company that specializes in merchandising and planogram use or buy its own planogram software. The purpose of the planogram is to increase sales and give the most popular product the best ability to sell. Stores routinely change the layout of all the sections. For example, the design of the laundry detergent section in a supermarket will be different every few months depending on what is hot and what is in season. The stores use a planogram to decide how the section will look and what products will be most accessible to the customer. Furthermore, with each design of a planogram, the store attempts to make a section look more aesthetically appealing to the customer. Planograms include shelf heights, product placements and the amount of facings. Shelf heights depend on the size of the products. Also they try not to put the product too high for the customers to reach. Product placement describes on which shelf and where on that shelf a product should be placed. A facing is a row of products. Thus, if a product has two facings, there are two rows of that product on the shelf. The spot and number of facings a product has will significantly alter its sales at the store. It will also change the overall performance of a store. It is much better for a product to be eye level and have the most amounts of facings than to be on the floor and have one facing. It is important for the store to have its most profitable products to have the most facings and be eye level than to waste that space on a product that does not sell nor provide a good profit margin.

Sales per square area

It is critical for the success of your business to constantly work towards improving not only the efficiency of employees, but the productivity of the store's selling space and inventory as well. This can be achieved by using various retail math formulas and calculations based on sales. The sales per square foot data is most commonly used for planning inventory purchases. It can also roughly calculate return on investment and it is used to determine rent on a retail
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location. When measuring sales per square foot, keep in mind that selling space does not include the stock room or any area where products are not displayed. A sale per square foot is simply the average revenue a retail business creates for every square foot of sales space. Total Net Sales Square Feet of Selling Space = Sales per Square Foot of Selling Space Sales per square foot is used by businesses and analysts alike to measure the efficiency of a store's management in creating revenues with the amount of sales space available to them. The higher the sales per square foot, the better job management is doing of marketing and displaying the store's products.

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MODERN TRADE @ PARLE AGRO PVT LTD

Parle Agro Pvt. Ltd. has its own Modern Trade Division a department in itself which is headquartered in Andheri, Mumbai.

The Hierarchy

National General Manager (GM): The National General Manager (GM) is responsible for the entire modern trade division of Parle Agro. Key Accounts Manager (KAM): There are four Key Accounts Managers (KAMs) who report to the GM. India have been divided geographically into four regions North, South, East and West. There are four KAMs who are responsible for these four regions. The KAMs are responsible for the modern trade conducted in their respective regions. Business Development Manager (BDM): For the proper working and ensuring that all the PAPL products are made available to the different formats of retail outlets in a region, there is a Business Development Manager (BDM) who handles all the operational activities for modern trade in the region. He is responsible for making the PAPL products available to all retail outlets like supermarkets, hypermarkets, etc. He is also responsible for the marketing of the PAPL products in the outlet. Business Development Executive (BDE): The BDM has a team of Business Development Executives (BDEs) reporting to him. The BDE co-ordinates with the merchandisers in the particular outlet and ensures that the products are available in good quantities in the outlet. He is also responsible for keeping the PAPL products in proper locations in a particular outlet. The products should be visible to the customers and the products should be placed in the proper category, for example, Frooti should be ideally placed in the Mango Drinks category and not along with the aerated drinks or the fruit drinks. The BDE gives the stock update to the BDM and is also responsible for the stock replenishment. The BDE sometimes also has to predict the stock for the coming week and assist the store category managers to generate the purchase orders (POs)
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accordingly. The BDE is also responsible for the execution of promotional offers, sampling activities, etc which are to be run at the different outlets. Merchandisers: Also, there are merchandisers who have been assigned to each retail outlet who would stay in the outlet and manage all the PAPL products there. The merchandisers select and allot space and the position of the PAPL products in the store. The merchandisers are in constant coordination with the BDE and report to the BDE on a daily basis. On the report on stock availability submitted by the merchandiser, the BDE replenishes the stocks at the outlet. There are two types of merchandisers hyper and convenience. The merchandisers who fall under Hyper are stationed at one single outlet. They are responsible for the PAPL products at that outlet. The merchandisers which fall under Convenience are roaming and are normally responsible for more than one outlet.

The Actual Trade

Parle Agro has a Distribution and Production Centre at Patalganga, near Karjat and Panvel, close to Mumbai in Maharashtra. Parle Agro is present in Modern Trade through the following retail outlets: 1. 2. 3. 4.
5.

6. 7. 8. 9.

Food Bazaar Big Bazaar DMart Star Bazaar Haiko Super Market Spencers More Megastore (ABRL) HyperCITY Reliance Mart

All the above mentioned outlets are divided into basic formats Hyper and Convenience. These formats are based on the formats mentioned in the chapter before. Convenience stores include Food Bazaar, Big Bazaar, DMart, Spencers and Haiko Supermarket. Hyper Stores include Star Bazaar, More Megastore, HyperCITY and Reliance Mart. On the basis of the distribution also, these outlets are classified as Direct and Indirect partners. Direct Partners: Direct Partners for Parle Agro include Reliance Mart, ABRL, Star Bazaar and Hypercity.
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In these outlets, when the stock gets exhausted or reaches the Minimum Base Quantity (MBQ), the category managers which are present in the stores and work for the stores, generate a Purchase Order (PO). The PO is generated depending upon the current stock level present in the outlet as well as the sales of that particular product. If the sales for a product have been good and are peaking, then a PO asking for more of those goods is generated. The purchase order is generated on a fixed day of the week for a particular company. For Example, PO for Parle Agro is generated on Mondays and Thursdays at different outlets. Once the PO is generated, this PO goes to the Distribution Centre (DC) of the retail outlet. There it is checked and validated. This PO is then mailed to the BDE who is in-charge of that outlet. The BDE then mails the PO to the Logistics Department which is present at the manufacturing plant. The manufacturing plant then releases the products as per the PO to the Parle Agro DC. The products and the PO are validated there and then the products are dispatched to the retail outlet. Sometimes, it happens that the BDE predicts the quantities to be mentioned in the upcoming week. The BDE checks with the Logistics team whether that much amount is available at the manufacturing plant. If that much amount is available, then there is no problem and the process goes on smoothly. If the desired quantity is not available, then the BDE informs the category manager at the outlet to issue a PO of lesser quantity. The category manager then issues the PO as per the availability. Indirect Partners: Indirect Partners include Big Bazaar, Food Bazaar, DMart, etc. In this type of outlets, when the stock gets exhausted or reaches the Minimum Base Quantity (MBQ), the same initial process is followed as mentioned above. The PO is generated, it goes to the DC of the outlet, it then goes to the Logistic Department of Parle Agro. After that, there is a slight change in the process. Now the number of stores under indirect category is much more as compared to that under direct category. For example, there are only three outlets of HyperCITY present in Mumbai viz. Malad, Thane and Vashi whereas there are 14 outlets of DMart spanned across Mumbai. Hence, it becomes very difficult to supply goods to all these outlets in a single day. Hence, Distributors have been assigned this job for Indirect Partners. The Distributers collect the goods from the manufacturing plant and supply them to these individual outlets. There are many distributors hired depending upon the region in which they operate. For example, there is one distributor who looks after the outlets present in Western suburbs whereas there is another distributor who looks after the Central suburbs.

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The Retail Giants

Big Bazaar and Food Bazaar Big Bazaar is a chain of hypermarkets in India, with more than 100 stores in operation. It is a subsidiary of Future Group Ventures Ltd. It was founded in 2001 under the guidance of Kishore Biyani. It follows the business model of United States based Wal-Mart. The first Big Bazaar outlet was opened in Kolkata. The name was so kept keeping the Indian mandi is mind. Since the size of the hypermarket was bigger than an average mandi, it was named as Big Bazaar. Big Bazaar is the Indian personification of retail. It is like an Indian bazaar or mandi or mela, the environment created by traders to give shoppers a sense of moment. Its personality is of being an entity away from fancy or pretty and being authentically no frills. Kishore Biyani never hired any foreign consultant for Big Bazaar which is evident from Indianspecific personality of the brand. To use predatory pricing is not in the personality of Big Bazaar, they never sell goods below the price they have purchased it. Big Bazaar, the "Indian Wal-Mart", is the modern Indian family's favourite store. Big Bazaar symbolizes modern retail, the business which isnt looked up to in our country, is now in the eyes of many multi-national biggies. Food Bazaar forms a part of the Future Value Retail Limited. The company operates 120 Big Bazaar stores and 170 Food Bazaar Stores in over 70 cities across India, covering an operational retail space of over 6 million square feet. Food Bazaar was started in 2002. It is a chain of large supermarkets with a difference, where the best of Western and Indian values have been put together to ensure customer satisfaction and comfort while shopping. The western values of convenience, cleanliness and hygiene are offered through pre packed commodities and the Indian values of "See-Touch-Feel" are offered through the bazaar-like atmosphere created by displaying staples out in the open, all at very economical and affordable prices without any compromise on quality. The strategy behind the concept of Food Bazaar and Big Bazaar is saving. Saving is the key to Indian middle class consumer. Price was the basic value proposition at Food Bazaar and Big Bazaar. These outlets sell variety of products at prices which are 5% to 60% lower than the market price. The catch line Isse sasta aur achcha kahin nahinemphasis this. The idea was to create a complete bazaar, with a large product offering offering a good depth and width in terms of range at a very reasonable price. A single Food Bazaar outlet stocks on average 10,000 SKUs (Stock Keeping Units) and occupies over 5000 square feet of retail space. The products are categorised as:
1. Processed Food and Non-Food (hungry kya?) contributes 60% of Food Bazaar sales.

This category includes a mix of products from a large number of FMCG companies.
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2. Dry Staples (Golden Harvest) contributes 30% of Food Bazaar sales. It includes dry

groceries like wheat, rice, dal, spice, etc. 3. Wet Staples (Chill Station) contributes 10% of the Food Bazaar sales. It includes Fruits and Vegetables. Beverages are also kept in the Chill Station. Parle Agro products occupy the Processed Food section and the Chill station at Food Bazaar. Store Design: Exterior design: Big Bazaar and Food Bazaar are normally located in big malls, shopping centres which are located on a busy main road. The location makes it ideal for the customers to stopover for some shopping. Also, where ever Big Bazaar and Food Bazaar are present, there is always an arrangement made for the parking facilities. This makes it convenient for the customers to shop and be least worried about their vehicles. Store front: Big Bazaar and Food Bazaar have huge signboards at the entrance displaying brand names Big Bazaar and Food Bazaar and their taglines highlighting the reasonable prices at which goods are available. Interior store design: Big Bazaar and Food Bazaar both follow a straight floor plan. All products being sold at these outlets have been departmentalised, for example, Beverages, Food, Ready-to-Eat, etc. It has been observed that generally racks of six rows are present at Food Bazaar and Big Bazaar. Planogram: Big Bazaar and Food Bazaar follow a more or less similar planogram. Since both are convenient stores, the shelf space allotted to all the products of different companies under different categories is very less. Also, the number of facings provided is less for all the products. Considering PAPL products in specific, in most of the Food Bazaar and Big Bazaar outlets, the products are present in good quantities but all types of packs for different PAPL products are not present. For example, in some of the Food Bazaar outlets, 250 ml PET bottles of Frooti were not present. Also, not even a single TCA of Frooti or LMN was found in any of the Food Bazaar and Big Bazaar outlets.

D- Mart Avenue Super Marts Pvt Ltd (ASPL) owns and operates hypermarkets and supermarkets by the store name D-Mart. D-Mart seeks to provide a one-stop shopping experience for the entire family, meeting all their daily household needs. A wide selection of home utility products is offered, including
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foods, toiletries, beauty products, garments, kitchenware, bed and bath linen, home appliances and much more. Since D-Mart first opened its doors in the Mumbai region in 2000, it has grown into a trusted and well-established shopping destination in the Mumbai Metropolitan Region (Mumbai, Navi Mumbai and Thane). D-Mart is now looking forward to growing its stores across India. D-Mart's expansion began in 2007, when stores were opened in Ahmedabad, Baroda, Pune, Sangli and Sholapur. Today D-Mart is established in 32 locations across Maharashtra and Gujarat. The main strategy behind D-mart was discounts. D-Mart offers a minimum 5% discount on all its products that it sells at the outlet. Normally, the discounts on a product are decided by the company manufacturing and selling it. However, at D-Mart, even if the company is not offering any discounts, D-Mart will put some of its own money into the product and offer a discount. By doing this, it is increasing its sales and attracting more and more customers. D-Mart also stocks a huge number of SKUs. Different products are placed category wise at D-Mart. D-Mart also has a chill section. However, the Chill section is exclusively dedicated to milk and dairy products. No beverages are kept in the Chill section at D-Mart. To counter this, they have a refrigerator present there in their outlets. These refrigerators are provided by one of the companies whose products are being sold at D-Mart and which require refrigeration. For example, Coca Cola provides its own refrigerator to D-Mart which houses all the Coca-Cola products. Parle Agro could do the same thing. Parle Agro has got its own range of refrigerators as well as products such as LMN, Appy Fizz, Grappo Fizz, Frooti, etc which require refrigeration. A customer who wants to consume Parle Beverages immediately would buy a beverage if it is cooled or chilled. Else he will ignore it and will pick a beverage from the Coca-Cola stable since their products are kept in a refrigerator. Hence, PAPL could provide D-Mart with their own refrigerators to stock PAPL products to increase sales. Store Design: Exterior Design: D-Mart stores are not located in mall. They are mostly present in isolation in one of the buildings or commercial complexes on a busy main road. The location selected is again ideal since it offers customer ease of access. However, there is one drawback of DMart. It does not provide sufficient parking space for customers. Customers who commute in vehicles specially cars find it difficult to shop at D-Mart due to lack of proper parking facilities. Store Front: D-Mart does not have many promotions done at the store front. There are very less glass panes on which one can advertise at D-Mart. D-Mart usually has a very small entrance and the space is very less for any kind of advertising or promotion to be done.

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Interior Store Design: D-Mart also follows a straight floor plan. All products being sold at these outlets have been departmentalised, for example, Beverages, Food, Ready-to-Eat, etc. It has been observed that generally racks of six rows are present at D-Mart. Planogram: Since D-Mart is a convenient store, the shelf space allotted to all the products of different companies under different categories is very less. Also, the number of facings provided is less for all the products.

Spencers Hyper Market Spencers Retail Limited is a multi-format retailer providing a wide range of quality products to discerning young customers - well-travelled citizens of the world, looking out for authentic flavours and experiences in a fun-filled shopping environment. Their brand positioning Taste the World embodies this approach, delighting shoppers with the best that the world has to offer in terms of interiors, ambience and merchandise. Part of the Rs 15,500 crore RPG Group, Spencers runs about 250 stores (including about 29 large format stores) across 50 cities in India, employing more than 6,000 people. As one of the earliest entrants in the retail space in India, Spencers has been instrumental in introducing Indian consumers to the concept of organized retailing, becoming the countrys first grocery chain back in 1920, and offering the joys of hypermarket shopping in 2001. A food first retailer Spencers offers both fresh and packaged foods as well as groceries. It also has a wide selection of electronics and electrical equipment, home and office essentials, garments and fashion accessories, toys, and personal care. Store Design: Exterior Design: Spencers Hyper Market is usually located in a mall. For Example, The Spencers Hyper Market at Malad is located inside the Inorbit Mall. The entrance and the exteriors consist of glass panes and there are heavy advertisements on these glass panes about various products and the discounts that Spencers is offering on them. Store Front: The store entrance resembles that of an entrance arch, leading in the shopper to a world that is welcoming and exciting. Interior Store Design: Spencers also follows a straight floor plan. The design is done in such a way to ensure that shoppers enjoy a warm and friendly ambience, an upscale look and feel, the joy of exploring and the convenience of locating what they want. From chefs tables to signage aids, the emphasis is on attractive, space-efficient, and low-maintenance presentation of modern, international goods alongside local flavours and product experiences.

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Planogram: Hotspots and focal points around the store carry thematic product displays to welcome shoppers and give them the opportunity to pause and absorb the ambience that constitutes a Taste the World experience, before continuing their journey of exploration. Category-specific colour coding (fresh green for food, sophisticated violet for fashion, blue for electronics and multimedia, and red for furniture and home goods) make for easy navigation, while visual metaphors of farm-fresh and Taste the World drive home the brand promise. However, since Spencers is a convenient store, the shelf space allotted to all the products of different companies under different categories is very less. Also, the number of facings provided is less for all the products.

HyperCITY HyperCITY provides a truly international shopping experience, where customers can shop in comfort in a large, modern, & exciting environment. It offers a wide and contemporary range of innovative products, sourced from both local and international markets. The product range covers: Foods, Homeware, Home Entertainment, Hi-Tech, Appliances, Furniture, Sports, Toys & Fashion. HyperCITY has an exclusive imported food from Waitrose and 24 hr Pharmacy for medical supplies. Gaming Zone and Cricket Net are present for childs entertainment. Demo Kitchen can assist the customer get product demos, taste recipes created by master chefs. Home Theatre Demo Room is a section under the retail outlet for sound-proof audio testing. HyperCITY comes packed with facilities like ATM facility. It is socially responsible as it provides access to the disabled to the toilets and to the store as there are wheelchair facilities available. It also provides free gift wrapping services. There are 30 check-out counters to facilitate faster check-outs without queues. The retail store is usually spread across 40,000 sq feet. Store Design: Exterior Design: HyperCITY is usually housed in a huge box like structure with HyperCITY written on it in huge fonts. There are no advertisements of discount offers as such in the exterior of the store. Huge parking spaces are available at HyperCITY. Valet Parking makes it even more convenient for the customers to visit the store. There are additional facilities like the Vodafone store, Presto Dry Cleaning Services, Thai Spa, Desi Caf, etc available at HyperCITY. Store Front: HyperCity has a single huge entry which is quite inviting. Once you are at the entrance you feel like you would be entering a huge palace or a huge hotel. Interior Store Design: HyperCITY also follows a straight floor plan. Various products are properly categorized and each category is given a good number of racks. For example, the Beverages section is given an entire lane of over 10 racks. HyperCITY also houses
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international brands in each category. For example, in the packaged water category, you will find Indian brands like Bailley, Bisleri, Kingfisher, etc but you will also find international brands like Evian, Shweppes, etc also. Planogram: Opulence is the key word while describing the planogram for HyperCITY. Each product in each category is given a large shelf space and a good number of facings. Even if the sales of a particular product are not up to the mark even then it is given good number of facings. The products which are sold at HyperCITY are basically targeted towards HNI (High Net worth Individuals).

Star Bazaar Hypermarkets like Star Bazaar are changing the way people shop for their groceries and household essentials. People who used to visit the local shops and vegetable market frequently are now buying at hypermarkets such as Star Bazaar that offer customers a variety of products at affordable prices, in a comfortable environment. But while affordability is a big factor for customers, they also seek value and quality which they know they will get at Star Bazaar, a Tata enterprise. The uniqueness of each Star Bazaar store lies in the size and spread of its merchandise range. Shoppers can select from a large range of staples, fresh goods, apparel, luggage, consumer durables, household products and much more and also enjoy the benefit of generous reductions on the market rate. The stores stock goods according to regional customer preferences, as customers in different regions favour different essentials. For instance, in Gujarat, people tend to stock up on their pulses whereas in northern India, basmati rice is a big item. The first store opened in Ahmedabad in 2004. The store operates in the hypermarket space. It stocks a whole range of products from food and grocery, to apparel, home and personal grooming products. Star Bazaar also has a tie up with Tesco, UKs leading retailer and one of the worlds leading international retailers. It has entered into an exclusive franchise agreement with Tesco. This arrangement has allowed Star Bazaars access to Tescos extensive retail expertise and technical capability including world class IT systems, processes and best practices in functions like marketing, stock management, retail information systems, cold-chain infrastructure and front-end services. Star Bazaar has also sourced merchandise from Tescos planned wholesale cash-and-carry business in India, benefiting from Tescos sourcing capability and supply chain expertise. Store Design:

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Exterior Design: Usually Star Bazaar is housed in an isolated building of its own. It usually occupies over 30,000 square feet of retail space. Huge parking spaces are available making it very convenient for the customers to visit the store. All stores are designed in a two storey format or three storey formats like Shoppers Stop. However, the Thane store is the first one to have a single-floor plan and is spread over 50,000 sq ft. The interiors, colours and lighting are appealing, and the simple layout and large signage makes it easy for customers to find the merchandise they are looking for. Store Front: Here also glass panes are present at the entry and exit of the store. On these glass panes, huge logos of Star Bazaar and some of the discounts and offers are put up. The main entrance is again made huge so that it makes it enticing for the customers to enter. Interior Store Design: Star Bazaar also follows a straight floor plan. There is much larger number of lanes. Also, the products are kept in very high numbers. For example, at Star Bazaar Thane, there are three huge racks of five rows each dedicated to Saint Juice which stocked over 300 1 litre tetra packs of Saint Juice. Also, there are directions boards present in the aisle similar to the ones we see at the airport which guide the customer to the proper category. Also, the space between the lanes is quite huge which makes it convenient for the customers during the peak hours. There are around 25 exit counters which reduces the length of the queues during peak time. Planogram: Star Bazaar also believes in opulence. It has more or less similar planogram to HyperCITY with large shelf space and good number of facings for each product in each category. More Megastore ABRL Aditya Birla Retail Limited is the retail arm of Aditya Birla Group, a USD 28 billion Corporation. The Company ventured into food and grocery retail sector in 2007 with the acquisition of a south based supermarket chain. Subsequently Aditya Birla Retail Ltd. expanded its presence across the country under the brand "more." with 2 formats Supermarket & Hypermarket. More. for you - Conveniently located in neighbourhoods, More supermarkets cater to the daily, weekly and monthly shopping needs of consumers. The product offerings include a wide range of fresh fruits & vegetables, groceries, personal care, home care, general merchandise & a basic range of apparels. Currently, there are over 600 More supermarkets across the country. More Megastores is a one-stop shopping destination for the entire family. Besides a large range of products across fruits & vegetables, groceries, FMCG products, More Megastore also has a strong emphasis on general merchandise, apparels & CDIT.

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Aditya Birla Retail Ltd provides customers a wide choice of products under its own labels. The objective is to provide quality products at attractive price points to customers. Since quality of the products is of prime importance, stringent quality norms have been set and are followed. All manufacturing partners are the best in their class.

Store Design: Exterior Store Design: Huge glass panes surround the entire store. One can view easily view inside and can also get an estimate how big the store is. All the activities promoting a particular product are conducted at the entrance of the store. Ample parking space is available. Store Front: The entrance of the store is not big enough but there are lot advertisements of various discounts and offers on different products at the entrance. Interior Store Design: This store too follows a straight floor plan. The products present here is not in opulence but sufficient number of products in each category are present. There are directions which lead to the different product categories. However, the space between the lanes is very less and customers sometimes do have a problem in navigating through the aisles. Planogram: The shelf space dedicated to most products is good. However, there are some discrepancies also. For example, Frooti 2 litre bottles are given an entire rack of 6 rows which houses over 100 bottles. That is not the case with the products in the same category. Another unique thing observes about More is that for the packaged water category, they are using vertical planogram. Now, most stores use horizontal planorgram i.e. each product in a category is given a single or multiple rows. The row housing a particular product does not have any other product in the same row. But at More, we see the entire rack of packaged drinking water is divided. All brands are present in each row of the rack. For example, a single rack will have Bailley, Kingfisher, Aquafina, Bisleri, Evian, Sumeru, etc. The same layout is replicated for the other five rows in the rack.

Reliance Fresh With a vision to generate inclusive growth and prosperity for farmers, vendor partners, small shopkeepers and consumers, Reliance Retail Limited (RRL), a subsidiary of RIL, was set up to lead Reliance Groups foray into organized retail. Since its inception in 2006, Reliance Retail Limited (RRL) has grown into an organization that caters to millions of customers, thousands of farmers and vendors. Based on its core
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growth strategy of backward integration, RRL has made rapid progress towards building an entire value chain starting from the farmers to the end consumers. RRL operates several value & specialty formats. The value formats that RRL operates are: Reliance Fresh, a neighborhood concept, Reliance Mart, an all under one roof supermarket concept & Reliance Super, a mini-mart concept. The value formats offer a wide range and assortment of products required for daily household needs. The specialty formats are: Reliance Digital, a consumer durables & information technology concept, Reliance Trends, an apparel & accessories concept, Reliance Wellness, a health, wellness & beauty concept, iStore by Reliance Digital, an exclusive Apple products concept, Reliance Footprint, a footwear concept, Reliance Jewels, a jewellery concept, Reliance TimeOut, a books, music & entertainment concept, Reliance AutoZone, an automotive products & services concept and Reliance Living, a home ware, furniture, modular kitchens, furnishings concept. Reliance Fresh is the convenience store format which forms part of the retail business of Reliance Industries of India which is headed by Mukesh Ambani. Reliance plans to invest in excess of Rs 25000 crores in the next 4 years in their retail division. The company already has in excess of 560 reliance fresh outlets across the country. These stores sell fresh fruits and vegetables, staples, groceries, fresh juice bars and dairy products. A typical Reliance Fresh store is approximately 3000-4000 square feet and caters to a catchment area ofkl 2-3 km. Store Design: Exterior Store Design: The design of the store reflects that it is low cost because the fixtures and the cost of the store look very low and gives a feeling of budget shopping and the use of graphics throughout the store attracts customers and communicates the deliverables of the store. Parking facilities are also available. Store Front: The logo of Reliance Fresh which includes a leaf structure representing freshness is present at the entrance very prominently. Interior Store Design: They also follow a straight floor plan. Danglers are used for the instore promotions. The space between lanes is less since it is more of a convenient store. Planogram: The planogram is more or less similar to Big Bazaar and D-Mart. All products in each category placed using a horizontal planogram. Reasonable shelf space is given to each category.

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COMPETITOR ANALYSIS
Beverages
Frooti There are over 100 mango based drinks in India. It is one of the largest selling Mango drinks in India. However, if faces stiff competition from Mango Slice which is a Pepsi product. It was launched in the Indian markets in 1993. Slices sensuous positioning is in complete contrast to the positioning of other mango drinks. Last year, Slice brought Katrina Kaif on board, making her the first star to endorse the brand. The brand was also revamped a new look, a new three-dimensional logo, reformulation of the taste, and a fresh concept Aamsutra the art of experiencing mango pleasure. Also, the target group for the brand, which was earlier between the ages of 18 - 24 years, shifted. The brand sought a new target audience people aged 22 years and above. It occupies a much larger shelf space and more facings as compared to Frooti in retail outlets. Another stiff competition which Frooti faces is in the form of Coca-Coals Mazaa. Mazaa is a fruit drink brand marketed in India and Bangladesh, the most popular drink being the mango variety, so much which over the years, the Maaza brand has become synonymous with Mango. Initially Coca-Cola had also launched Maaza in orange and pineapple variants, but these variants were subsequently dropped. Coca-Cola has recently re-launched these variants again in the Indian market. Maaza was launched in 1976 in India. The Union Beverages Factory, based in the United Arab Emirates, began selling Maaza as a franchisee in the Middle East and Africa in 1976. By 1995, it had acquired rights to the Maaza brand in these countries through Maaza International Co LLC Dubai. In India, Maaza was acquired by Coca-Cola India in 1993 from Parle-Bisleri along with other brands such as Limca, Citra, Thums Up and Gold Spot. As for North America, Maaza was acquired by House of Spices in 2005. Star Bazaar has come up with its own Mango drink. However, that is available only at Star Bazaar. But it is being offered at comparable prices and even discounts are given on it. Hence, it is posing as a competition, not just for Frooti but for Slice and Mazaa as well. Appy Classic and Appy Fizz Appy Classic and Appy Fizz are the undisputed leaders in the Apple drink category. Appy Classic is plain aerated apple drink whereas Appy Fizz is carbonated apple drink. Litchica International has brought out its Apple flavor product in the market. Litchica products are a hit in the states of Bihar and Madhya Pradesh. However, the apple juice from
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Litchica is in a very nascent stage and will take time to capture substantial market share (if consumers like the product). Star Bazaar has come up with its own Apple drink. However, that is available only at Star Bazaar. But it is being offered at comparable prices and even discounts are given on it. Hence, it is posing as a competitor to Appy at Star Bazaar. Grappo Fizz Grappo Fizz is the new sparkling grape drink in town. It is a first of its kind product with no close competition in the market. However, Appy Fizz faces competition from Grappo Fizz after it launch. People who were regular consumers of Appy Fizz might shift to Grappo Fizz now. LMN LMN is a natural lemon juice drink and the only brand in India with a taste closest to homemade, fresh lime water, also known as nimbu pani. With no artificial flavours and real lemon juice, LMN will provide consumers a healthy, refreshing drink with the goodness of vitamin C. Every summer, the Indian beverage market has seen cola majors battle it out. This summer, the launch of LMN saw the cola wars taking a back seat and the battle spilled over to the non-cola segment, to be more precise in the nimbu paani category. Major competitors for LMN in this category are Nimbooz from Pepsi and Minute Maid Nimbu Fresh from Coca-Cola. Nimbooz was the first brand that was launched in market which was positioned as natural lemon refresher. It was positioned as asli indian, asli nimbu(Real Indian, Real Lemon). Then came LMN, which also positioned it as lemon based refreshing drink. Now few months back, Coca-Cola too entered the battle with the lemon flavour of its brand Minute Maid which was available in Pulpy Orange flavour. The positioning is similar. They claim it to be Ghar Jaisa (Home Like). The shelf space at all retail outlets is also directly proportional to the time they have been in market. Nimbooz occupies the maximum shelf space in this category followed by LMN and then Minute Maid Nimbu Fresh. However, Nimbooz and Minute Maid are rising real fast as brands.LMN is not that much visible in the market. Saint Juice Saint Juice is the new entrant to the fast growing fruit juice market. The brand is making a foray into a market which is highly segmented and often highly confusing (to the consumer). Indian beverages industry which is worth Rs 7000 crore is divided broadly into carbonated and non-carbonated categories.
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The fruit based drinks market is highly confusing for a customer. Frooti, Tropicana, Maaza, Real etc are all fruit based beverages. If you look at the products, there are different types of fruit beverages: Fruit Drinks: These are those drinks where there is a less than 20% fruit pulp. Frooti, Maaza etc belong to this category. Fruit drinks is the dominant category which is worth around 250-300 crores. Fruit Nectar: These contain less around 25- 85% fruit pulp. Brands like Godrej Xs and Real Nectar belongs to this category. This is a small category worth around Rs 35 crore. Fruit Juice: These are fruit beverages that contain 85% and more fruit pulp. Tropicana and Real belongs to this category. This category is worth Rs 150 crore. With in the Fruit Juices segment, a new category is emerging which is the 100% juice category. Most consumers are not aware of this micro segmentation. Those who drink Frooti or Maaza do not know or is not bothered about the fruit pulp content. The reason is that, they drink these beverages for the taste (and quenching thirst). Unlike the fruit drinks, customers of fruit juices are health conscious. One of the reasons for them taking this product category is that they want a healthy drink. The product is more of a health supplement than a beverage. The fact that these products are less tasty compared to fruit drink is a proof that only the health conscious ones will take it. The category of fruit juices are dominated by Dabur's Real and Pepsi's Tropicana. Real is the market leader with around 55 - 60% share and Tropicana takes the rest. Saint Juice is a 100 % fruit juice. The brand is positioned as a 100 % juice. This positioning is relevant because consumers are confused about the category. The 100 % juice positioning of Saint is a real threat to Real and Tropicana. Real and Tropicana had extended itself into fruit drinks and fruit nectar categories. Real have Real Twist and Tropicana have Twirl in the fruit drinks category. Both these brands have their nectar variants. Recently Real and Tropicana launched their 100 % juice variant. This is a typical case where a brand is trying to be everything to everybody.

Packaged Drinking Water

Bailley is Parle Agros contribution towards the packaged drinking water segment. The Indian packaged water business is estimated at around Rs 2,500 crore with a growth rate of close to 35 per cent. While India ranks in the top 10 largest bottled water consumers in the world, its per capita per annum consumption of bottled water is estimated to be five litres which is comparatively lower than the global average of 24 litres. Today it is one of India's
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fastest growing industrial sectors. Between 1999 and 2004, the Indian bottled water market grew at a compound annual growth rate (CAGR) of 25 per cent - the highest in the world. With over a thousand bottled water producers, the Indian bottled water industry is big by even international standards. There are more than 200 brands, nearly 80 per cent of which are local. Most of the small-scale producers sell non-branded products and serve small markets. In fact, making bottled water is today a cottage industry in the country. Leave alone the metros, where a bottled-water manufacturer can be found even in a one-room shop, in every medium and small city and even some prosperous rural areas there are bottled water manufacturers. Despite the large number of small producers, this industry is dominated by the big players Parle Bisleri, Coca-Cola, PepsiCo, Parle Agro, Mohan Meakins, SKN Breweries and so on. Parle was the first major Indian company to enter the bottled water market in the country when it introduced Bisleri in India 25 years ago. Bailley faces stiff competition from Parle Products Bisleri, Pepsis Aquafina, Tatas Himalayan, United Spirits Kingfisher Drinking Water, Aqua, Sumeru, etc. Now even the International brands like Evian and Schweppes are entering the Indian markets creating further competition.

Snacks
Following the recent launches of LMN and Grappo Fizz, Parle Agro has extended its presence into the snack food category, by the launch of a new baked wheat snack brand 'Hippo'. Hippo is a baked product which has minimum levels of cholesterol and fat. It falls into the baked product category. However, it has to compete with the products present in the fried chips category like Ruffles Lays, Kurkure, Bingo, Musst Chipps and Pringles. In all the retail outlets, Hippo is kept along with the fried wafers and potato chips category. Ideally it should fall into the baked products category. Also, these kinds of products give better margins to the company, in addition to the fact that companies want to capitalize on the growing health consciousness of Indian consumers. Parle Agro has positioned 'Hippo' as a healthy-baked snack with the goodness of wheat. Ideally it should be competing with Frito Lays Aliva which is also newly launched.

Confectionery
Parle Agro has forayed into the confectionery category also by launching ButterCup candies. These are hard boiled candies made with caramel. Post that PAPL launched ButterCup Softease which is easy chew toffee available in different flavours. Both these are directly in competition with Alpenliebe, Eclairs, Mentos, Coffee Bite, Parle Poppins and many more.
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However, the presence and visibility of ButterCup and ButterCup Softease is very poor in modern trade as compared to its competitors. Also, no promotion activities and advertisements can be seen in this regards.

Offers on PAPL Products as well as Competitors Products

Please go through the sheet attached. The sheet contains all the offers which are running on PAPL offers in all the retail outlets in Mumbai. The other part of the sheet contains the offers running on the competitors of PAPL products in these retail outlets.

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AREAS OF IMPROVEMENT AND SUGGESTIONS

PAPL Products
Frooti Frooti is a flagship brand of Frooti. But sales have been dropping for Frooti. Problem Areas and Solutions:
1. Frooti is sometimes not kept in the proper category i.e. in the mango drink category

along with Mango Slice and Mazaa. There were some outlets where Frooti was kept along with the aerated drinks. Hence, Frooti has to be kept in proper category. 2. All the different pack sizes of Frooti are not present in every outlet. Frooti 1.2 ltr bottles were present in all the outlets. However, 250ml, 1ltr tetra pack, 600 ml Frooti bottles were not present in some of the stores. The 100ml TCA pack was not present anywhere. Hence, Frooti should be made available in all different sizes packs. 3. There were some outlets where Mango Slice had an entire table kept at the centre or in one of the aisles which would easily grab attention. Such an arrangement was not found for Frooti in most of the outlets. Hence, once in a while, when the sales are slump, a paid display for Frooti should be used and Frooti should be placed in a good visibility location. 4. Mango Slice does a good lot of Visual Merchandising (VM) in the retail outlets. A similar drive of VM should be used for Frooti also. Frooti has recently come up with the Why Grow Up? tagline and in the recent commercial we can see large mangoes falling on the roads. The same concept in the form of VM should be used in outlets. Appy Classic Appy Classic is a brand from PAPL which is very exclusive and does not have a strong competitor. Problem Areas and Solutions:
1. In many outlets there was an offer running in which if you buy a 1ltr tetra pack if

Appy Classic, you get a 200ml tetra pack of Appy Classic free. This offer was not uniform across all the outlets. Hence, uniformity of offer should be there. 2. In many outlets, 1ltr tetra packs were not present. Hence, both the size packs should be made available at all stores. 3. No awareness of the brand Appy Classic. We will need more cutouts, banners, standees, TV advertisements, promotions, etc to be done for Appy Classic to create awareness and to boost sales.
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Appy Fizz and Grappo Fizz Problem Areas and Solution:

1. There were some outlets in which Appy Fizz and Grappo Fizz were kept along with

the aerated beverages. They do not belong to the aerated category. They are a category of their own. They should be kept at a separate location from the aerated drinks. 2. In some of the outlets, all sizes bottles of Appy and Grappo Fizz were not present. It should be ensured that all different sizes of bottles should be present. 3. The advertisement which has Appy and Grappo Fizz together and in which Appy Fizz introduces Grappo Fizz as his cousin is not highlighted in any of these stores. So, the advertisement loses its meaning when it comes down to the presence being made felt in modern trade. There should be cut-outs, standees; etc of the two cousins standing close by and the bottles should be kept near the promotion area. For example, following is the picture which can be used:

People relate to the products like Appy Fizz and Grappo Fizz through the TV advertisement. Hence, the same thing should also be utilised while the product is on display in the retail outlets. 4. Appy Fizz and Grappo Fizz when they are kept together can be a competition to each other. For example, Grappo Fizz is new launched. Hence, when it is kept with Appy Fizz, it can be a competition to Appy Fizz which might reduce sales of Appy Fizz. Hence, they should NOT be kept close to each other.

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Saint Juice Problem Areas and Solutions:

1. Saint Juice is a fairly unknown product to the consumers as compared to Frooti and

2.

3. 4.

5.

6.

Appy Fizz. Hence, awareness has to be created before launching the product which has not been done in case of Saint Juice. Many of the consumers are not even aware of the brand called Saint Juice. A well crafted TV commercial for Saint Juice produced by Niravana Films was made. However, it is not being aired on TV. The commercial should be aired to create brand awareness for Saint Juice. Saint is a 100% juice and contains no preserved flavours. Hence, it should be ideally kept in the 100% fruit juice category. However, it shares the space with all the fruit juices which are present in the market today. In India, there are very few 100% fruit juice brands like Saint Juice and Tropicana 100%. Hence, these two brands must be kept together and their importance must be properly highlighted Poor shelf space has been given to Saint Juice in most of the outlets. Hence, to increase sales, more shelf face with more facing should be given to Saint Juice. In many of the outlets, all flavours of Saint Juice were not present. Also, in some of the outlets, only 1 ltr tetra packs were present and 200ml tetra packs were not present. Availability of all the flavours and different size packs should be ensured. Since Saint Juice is not widely known, a sampling activity for Saint Juice needs to be done. This needs to be done at the same time when the TV commercial for Saint Juice is on air. There was a combi offer which PAPL had launched. In this combi offer, a 200ml tetra pack of Frooti was given free with two large packs of Hippo. Based on similar lines, a 200ml Saint Juice (any flavour) can be given free with two large packs of Hippo or with a 2litre Frooti party pack. Now, Hippo and Frooti are products which consumers would purchase and this offer would ensure that consumers get a Saint Juice to take away home with them free of cost. They would taste Saint Juice in
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this way and if they like it they are bound to purchase Saint Juice next time they go shopping. 7. Another thing which can be done to increase the sales of Saint Juice is to change the packing. Saint Juice should be made available in attractive PET bottles (like Orangina). This would ensure that consumers would feel convenient to carry a PET bottle rather than a tetra pack. LMN Problem Areas and Solutions:
1. In most of the outlets, LMN was kept in the proper category of lemon based drink

along with Minute Maid Nimbu Fresh and Nimbooz. However, in terms of quantity, it was less as compared to its competitors. This creates not so good an impact on consumers. Hence, to attract consumers, LMN should be kept in sufficient quantities. 2. In almost all the outlets, only 1ltr and 500ml PET bottles and 200ml tetra packs of LMN were kept. 250ml and 200ml PET bottles were not to be found anywhere. Hence, LMN should be made available in all sizes packs at all outlets. 3. Again, with this brand too, VM should be utilised to promote the brand. The new commercial for LMN which shows black people in a desert should be highlighted along with the tagline Thirsty? Lemon Lemon Lemon. Bailley Problem Areas and Solutions:
1. In some very prominent outlets like HyperCITY Malad, there was no stock of Bailley

at all. In other words, Bailley was not being sold at all at HyperCITY Malad. There were some such outlets where Bailley was not sold at all whereas the competitors like Kinley, Aquafina, Bisleri, Kingfisher, etc were sold. Hence, presence of Bailley in all the outlets should be ensured. 2. In some of the outlets, Bailley was placed at the bottom rows of a rack and that in small quantities. More shelf space, if possible, should be given to Bailley and the space should be stacked with sufficient quantities of bottles. 3. Bailley was present in only 1 ltr bottles. 500ml PET bottles of Bailley should also be made available at the retail outlets. This would ensure that people who get thirsty while shopping or those who are alone and thirsty would be pick up these bottles as a 500ml bottle of Bailley would be enough to quench a single persons thirst and he would not pick up a 1ltr bottle. Also, very few competitors have 500ml PET bottles in the retail outlets. Hence, it would be an edge over the competitors. Hippo Hippo marks the entry of Parle Agro into the snacks food category
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Problem Areas and Solutions:

1. Hippo is a baked product unlike Ruffles Lays or Kurkure which are fried products.

2.

3.

4.

5.

Hence, the USP of Hippo is that it is baked and hence a much healthier option. But if still is placed in the fried snack category. The fact that it is a baked product does not come out too distinctly in the case of Hippo. The TV commercial on air also does not highlight that fact. Hence, it needs to be highlighted that it is a much healthier option since it is a baked product. In almost all the outlets, there was always this one problem that all the flavours were not available at all the times. There was always one or the other flavour missing. The onus of solving this problem lies on the outlet merchandiser and the BDE assigned to that outlet. The merchandiser should update the BDE the exact count of each flavour present at the outlet every evening. The BDE should then follow it up in terms of the quantities to be delivered in the next purchase order of the outlet. All flavours in all packs should be made available at all times. Less shelf space is given to Hippo as compared to its competitors like Ruffles Lays, Kurkure, Bingo, Musst Chips, etc. Now, it is understood that the other competitors are a much bigger brand and they have that much money to spend on their brand to buy more shelf space. But the shelf space also depends upon the sales. Hence, if sales are good then more shelf space is allocated to the product. Hippo has had good sales so far and so, it is the duty of the merchandiser and the BDE to ensure that enough shelf space and more facings are given to Hippo. Also, there should be a bin containing Hippo at all outlets at the entrance or at the exit. There was a sampling activity conducted for Hippo. Now for this sampling activity, ideally there should have been samples of all seven flavours ready as well as there should have been all packs of all seven flavours ready to be sold during the activity. But this was not the case. Either one or two flavours of samples were not there but the product was there to be sold on the shelf or all flavours of samples were there but the product was not there to be sold. Hence, such irregularities should be avoided, at least at the time of sampling activity. The sampling activity was not conducted at HyperCITY Malad even after booking the dates for the sampling activity. HyperCITY Malad is a store where usually you have High Net-Worth Individuals (HNIs) shopping and in such a market the sampling activity was not conducted.

Buttercup Candies and Buttercup Softease Problem Areas and Solutions

1. In many of the outlets, there were no packets of either of these confectioneries

present. Hence, the product should be made available at all outlets. 2. Visibility is also an issue. The product should be made more visible.

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3. Awareness is not there regarding this brand of products. Awareness drive through

TV commercials or through print ads should be undertaken. If that is not possible then, promotion through offers should be done. For example, teaser packs of ten or fifteen Buttercup candies or Buttercup Softease should be introduced and they should be given free in a combi offer like that of Hippo or it could be given free with a 1.2ltr or a 2ltr party pack of Frooti or with 1ltr Appy Fizz.

Retail Outlets
Big Bazaar and Food Bazaar The shelf space and the number of rows in a rack allotted to PAPL products is less as compared to those of the competitors products. The shelf space has to be increased in these outlets as these are more of convenient stores and you have more footfalls in these stores. Also, the number of facings especially for Saint Juice and Hippo need to be increased to increase sales for the products. The good thing about Big Bazaar and Food Bazaar is that they have a Chill Section which stores all PAPL products which can be served to the customers chilled. We have to ensure that all beverages of PAPL are kept in this Chill Section and in good quantities. Also, in Big Bazaar, there is an aisle connecting the ground and the first as well as the first and the second floor (for example, the outlet in Thane, Bhayandar, etc). PAPL products can be kept stacked along these aisles so that it becomes attractive for a customer to pick the product up while going from one floor to another. Big Bazaar and Food Bazaar provide bins at the entrance and exit. We have to ensure that we get one of the bins either at the entry or at the exit (preferably at the exit since people tend to forget picking up something when in the category aisles and pick up at the exit). All this would be possible if the merchandiser and the BDE are on good relations with the store manager. D-Mart D-Mart unlike Big Bazaar and Food Bazaar does not have Chill Section. But Coca-Cola and Pepsi have installed their own refrigerators there for their products. We can do the same using our own Visi Coolers. We can have all the PAPL beverages stacked up in the Visi Cooler which would enable consumers enjoy the PAPL beverages chilled. On other parameters, D-Mart is very much similar to Bid Bazaar and hence the above mentioned suggestions are applicable to D-Mart also. HyperCITY
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A lot of shelf space and good visibility of PAPL products can be observed at HyperCITY. Hence we just need to ensure that we have all the PAPL products in good quantities on display at these outlets. Discovery Hampers are a unique feature of HyperCITY and we should make sure that the hampers are available at all times. Star Bazaar Here also, a lot of shelf space is given and good visibility of PAPL products is possible. Hence, here also we just need to ensure good quantity. More Megastore (ABRL) Here the arrangement is different as there is no arrangement of beverages as per the category. For example, one entire rack is given to Frooti where bottles of different sizes can be kept. The packaged water category has a vertical planogram. All the brands of packaged water are placed in all the rows of a single rack. Hence, for such an arrangement, we need to ensure good quantities of all SKUs are present.

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CONSUMER BUYING BEHAVIOUR FOR SAINT JUICE (GREEN APPLE)

Fruit Based Drinks Market
The fruit based drinks market is highly confusing for a customer. Frooti, Tropicana, Maaza, Real etc are all fruit based beverages. Some tastes good and some not so good. There are three different types of fruit beverages:
1. Fruit Drinks: These are those drinks where there is a less than 20% fruit pulp. Frooti,

Mazaa, etc belong to this category. Fruit drinks is the dominant category which is worth around 250-300 crores. 2. Fruit Nectar: These contain less around 25- 85% fruit pulp. Brands like Godrej Xs and Real Nectar belongs to this category. This is a small category worth around Rs 35 crore. 3. Fruit Juice: These are fruit beverages that contain 85% and more fruit pulp. Tropicana and Real belongs to this category. This category is worth Rs 150 crore. Within the Fruit Juices segment, a new category has emerged which is the 100% juice category. Most consumers are not aware of this micro segmentation. Those who drink Frooti or Maaza do not know or is not bothered about the fruit pulp content. The reason is that, they drink these beverages for the taste (and quenching thirst). Unlike the fruit drinks, customers of fruit juices are health conscious. One of the reasons for them taking this product category is that they want a healthy drink. The product is more of a health supplement than a beverage. The fact that these products are less tasty compared to fruit drink is a proof that only the health conscious ones will take it. The category of fruit juices are dominated by Dabur's Real and Pepsi's Tropicana. Real is the market leader with around 55 - 60% share and Tropicana takes the rest before Saint Juice was launched.

Brief on Saint Juice

Saint Juice is a 100 % fruit juice. The brand is positioned as a 100 % juice. This positioning is relevant because consumers are confused about the category. Saint Juice is its minimalistic design. The packaging is uncluttered and very visible on supermarket shelf. The 100 % juice positioning of Saint is a real threat to Real and Tropicana. Real and Tropicana had extended itself into fruit drinks and fruit nectar

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categories. Both these brands have their nectar variants. Recently Real and Tropicana launched their 100 % juice variant. The current positioning of Saint Juice is targeting the consumer who is actively looking for a 100% juice. These are consumers who take juice as a part of their diet and also know the difference between various fruit drinks and don't bother much about the taste. But the category is very small.

Saint Juice Green Apple Study

Parle Agro launched a new flavour in the 100% juice category under the brand Saint Juice GREEN APPLE in May 2010. The brand in Modern Trade was launched in Big Bazaar, HyperCITY and D-Mart. Following outlets were covered to check the visibility and the consumer behaviour for Saint Juice Green Apple.
1. HyperCITY Malad

2. Big Bazaar, Mumbai Central 3. D-Mart Malad 4. D-Mart Kandivali 5. Food Bazaar, Malad Following are the observations and diagnosis for these outlets
1. HyperCITY, Malad

Display: Saint Juice was placed in a rack where all the tetra packs were kept. There were tetra packs of Tropicana above Saint Juice and Real Activ below Saint Juice. There were two rows in a single rack which were given to Saint Juice. Good number of facings was present for Saint Juice. Out of the two rows, one row was full of Saint Juice Mixed Fruit. There were around 50 odd tetra packs of Mixed Fruit kept in the entire row. The next row was occupied by Saint Juice Orange and Saint Juice Green Apple. There were around 30 odd Orange tetra packs and around 20 odd Green Apple tetra packs in the same row. Green Apple was sharing the shelf space with Orange. No offers or discounts were running on Green Apple whereas there was a discount of Rs. 15/ - on Saint Juice Orange. Observations: There were very few consumers who actually looked at Saint Juice. They were more interested in Tropicana or Real Fruit Juices. Orangina was another fruit juice which was hot on demand as there was a sampling activity going on for Orangina.
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Interactions: There were some five consumers who were asked some general questions about Saint Juice. Following are the conclusions which were derived out of the interactions: Most of them had not heard about the brand called Saint Juice There was just one customer who was aware that Saint Juice as a brand existed and it had three flavours. None of them knew that Saint Juice has come up with a new flavour i.e. Green Apple. They were not interested in buying Saint Juice Green Apple because they were not familiar with the brand name neither they trusted the brand as there was no promotion activity for the brand. One of the consumers asked why Saint Juice doesnt have an advertisement or a TV commercial on air on TV. 1. Big Bazaar, Mumbai Central Display: Saint Juice was kept in the Fruit Juice category. However, the shelf space given to Saint Juice was very less with just five facings. Now, in such a small space, we had three flavours of Saint Juice i.e. Orange, Mixed Fruit and Green Apple. Mixed Fruit had just one facing whereas Orange and Green Apple had two each. The picture given below represents how Saint Juice was placed at the outlet.

The rack in which Saint Juice was placed was exactly opposite to the Chill section and there was very less space for customers to walk. Also, Saint Juice was kept in the
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third row from bottom and the consumers had to bend down to pick up a tetra pack. Hence, it was not an ideal location where Saint Juice could be starkly visible. Considering Green Apple, here also, it had to share space with the other flavours of Saint Juice. Also, at the start of the Beverages section, there were stacks of Fruit Juices of different brands kept together. Brands like Tropicana, Real Activ, Burrst, Jumpin, KD Juice, etc were stacked on their respective boxes. However, Saint Juice was not present in that lot. Observations: Very few customers actually looked at Saint Juice and none of them seem interested or know that Saint Juice has come up with a new flavour i.e. Green Apple. Interactions: Interactions could not be done here as there were very few customers who actually came to that section and picked up a tetra pack from there. Also, there was a guard standing next to the Chill section who made sure that there was no kind of survey going on inside the store. Hence, no customers could be interacted with at this outlet.
2. D-Mart, Malad

Display: Saint Juice not kept in the proper category. The tetra packs were kept along with Appy Classic Tetra Packs. Just one row given to Saint Juice and there also only three flavours were present i.e. Orange, Mixed Fruit and Green Apple. Again, here also, more facings were given to Orange and Mixed Fruit as compared to Green Apply which was given only two facings. The good thing, however, was that Saint Juice was kept in the third row from top which is right in front of the eye. Observations: Though Saint Juice Green Apple was placed in front of the eye, there was only one customer who picked up Saint Juice Orange. No one else picked up Saint Juice in a span of 45 minutes. Many customers were not even looking at Saint Juice. They were more interested in Tropicana or Real. Interactions: There were some five consumers who were asked some general questions about Saint Juice. Following are the conclusions which were derived out of the interactions: Most of them were not aware of Saint Juice and neither about Saint Juice Green Apple. One customer picked up Saint Juice Orange. He was asked as to why he picked up Orange and not Green Apple which is a new flavour. He said that
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Orange fruit juice was his favourite and he didnt prefer any other flavour except Orange.
1. D-Mart, Kandivali

Display: Just one row was given to Saint Juice and only two flavours present viz. Orange and Green Apple. For Green Apple only a single facing was given. There were only six tetra packs of Green Apple and that too they were very conspicuous. No offers running on Green Apple. However, there was a Rs. 15/- discount on Saint Juice Orange but not on Green Apple.

Observation: None of the customers passing next to the rack containing Saint Juice even noticed the product and the new flavour i.e. Green Apple. Interactions: There were some five consumers who were asked some general questions about Saint Juice. Following are the conclusions which were derived out of the interactions: None of them knew the brand Saint Juice neither they were aware that a new flavour Green Apple has been launched. One of them said that it was too costly for a fruit juice and questioned that there is an offer running on Saint Juice Orange, then why not on Saint Juice Green Apple.
1. Food Bazaar, Malad

No Saint Juice Green Apple present at the outlet.

Areas of Improvement and Suggestions for Saint Juice Green Apple

1. Some kind of promotion activity needs to be done for Saint Juice as well as for Green Apple. 2. A Sampling Activity needs to be undertaken for Saint Juice Green Apple to boost sales. 3. More visibility of Green Apple needs to be enforced by increasing the shelf space. If that is not possible, then more facings should be there for Green Apple as compared to the other three favours.
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4. Small 200ml tetra packs should be launched and sold for the customers to initially try the smaller packs for taste. 5. Small 200ml tetra packs could be given free in a combi offer (200ml tetra pack of Saint Juice Green Apple free with two large packs of Hippo).

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BIBLIOGRAPHY
1. www.parleagro.com 2. The Rising Elephant Benefits of Modern Trade to Indian Economy Report by PriceWaterHouse Coopers (PwC) 3. www.chillibreeze.com/articles_various/retail-India.asp 4. www.thehindubusinessline.com/catalyst/2010/06/10/stories/2010061050050200.htm 5. www.fashionunited.in/news/fashion/wal-mart-seeks-changes-in-indias-fdi-norms.htm 6. Indian Food Retail Sector in the Global Scenario Report by Vijay Anand3 and Vikram Nambiar4 7. Intra and Inter Format Competition Among Discounters and Supermarkets Kathleen Cleeren, Frank Verboven, Marnik G. Dekimpe and Katrijn Gielens dated September 2, 2008 8. www.economywatch.com/business-and-economy/e-retailing-india.html 9. www.pantaloonretail.in/companyinfo.asp 10. www.ehow.com/about_5121117_planograms.html 11. www.dmartindia.com/disclaimer.html 12. www.spencersretail.com/content.aspx 13. www.tata.com/media/articles/inside.aspx 14. www.ril.com/html/business/business_retail.html 15. www.marketingpractice.blogspot.com/2009/01/saint-juice-100-juice-nothingelse.html 16. www.gits4u.com/water/water16.htm 17. www.marketingpractice.blogspot.com/2009/01/saint-juice-100-juice-nothingelse.html

3 Vijay Anand Assistant Vice President, Sathguru Management Consultants 4 Vikram Nabiar Associate Consultant, Sathguru Management Consultants

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