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“Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products”

Report Submitted In Partial fulfillment of the requirement for the certificate of Post Graduate Programme in Retail Management Submitted By Ankur Srivastava Reg. No. – FPRB0810/005 Under the Guidance of Internal Mentor
Prof. Heema .D
Professor

External Mentor
Mr. Dheeraj Choudhary
Store Manager Spencer’s Hyper Lucknow Miss. Shefali Gupta Department Manager (Fmcg –food)

Indian Business Academy

INDIAN BUSINESS ACADEMY Lakshmipura, Thataguni Post Kanakapura Main Road, Bangalore – 560 062 INDIA

DECLARATION
I, Mr. Ankur Srivastava, student of Indian Business Academy, Bangalore, declare that this project report titled “Catchment Area Analysis & Merchandising of FMCG-Food Products” is submitted in partial fulfillment of the requirement for the summer internship project during the Post Graduate Programme in Retail Management. This is my original work and has not been previously submitted as a part of any other degree or diploma of another Business school or University. The findings and conclusions of this report are based on my personal study and experience, during the tenure of my summer internship.

Mr. Ankur Srivastava FPRB0810/005
Indian Business Academy

Lakshmipura, Thataguni Post Kanakpura Main Road, Bangalore – 560062 INDIA Tel: +91-80-28435931/32/33/34 Fax: +91-80-28435935

Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Acknowledgement

It is a great pleasure for me to express my hearty and sincere gratitude to my CEO Mr. Manish Jain , My Dean. Dr. Subhash Sharma & faculty guide, Mrs Hema.D, under whose genuine and inspiring guidance the present piece of investigation could get its present shape within such a limited range of time. I am highly thankful to Mr. Deeraj Chaudhary (Store Manager Spencer’s Hyper, Lucknow) who guided me in the survey, Ms Shefali Gupta (Department Manager FMCG-Food) for giving me a deep insight about the category and the working of Spencer’s and to the management of Spencer’s for permitting me to carry out present research work. Special thanks are also due to all the customers and employees of the Spencer’s for their precious co-operation provided to me during the period of data collection. More than anyone I wish to records my feelings of gratefulness to my family members. I am thankful to my father Mr .Pramod Kumar Srivastava, my mother Preeti srivastava, my sister Shweta Srivastava and all my friends. Their inspirations, affection, care and whose blessings have given me necessary enthusiasm and encouragement to complete this work.

Place: Lucknow

Ankur Srivastava

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CEO’S CERTIFICATE
This is to certify that Mr. Ankur Srivastava is a bonafide student of Indian Business Academy, Bangalore. He is presently pursuing Post Graduate Programme in Retail Management. He has submitted his project report titled “Catchment Area Analysis & Merchandising of FMCG-Food Products” in partial fulfillment of the requirement for the Summer Internship Project during the Post Graduate Diploma in Retail Management. This report has not been previously submitted as part of another degree or Diploma of any other Business School or University.

Mr. Manish Jain, Indian Business Academy
Lakshmipura, Thataguni Post Kanakpura Main Road,
Bangalore – 560 062

INDIA
Tel: +91-80-28435931/32/33/34 Fax: +91-80-28435935

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

DEAN’S CERTIFICATE
This is to certify that Mr. Ankur Srivastava is a bonafide student of Indian Business Academy, Bangalore. He is presently pursuing Post Graduate Programme in Retail Management. He has submitted his project report titled “Catchment Area Analysis & Merchandising of FMCG-Food Products” in partial fulfillment of the requirement for the Summer Internship Project during the Post Graduate Diploma in Retail Management. This report has not been previously submitted as part of another degree or Diploma of any other Business School or University.

Dr. Subhash Sharma, Indian Business Academy
Lakshmipura, Thataguni Post Kanakpura Main Road,
Bangalore – 560 062

INDIA
Tel: +91-80-28435931/32/33/34 Fax: +91-80-28435935

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

MENTOR’S CERTIFICATE
This is to certify that Mr. Ankur Srivastava is a bonafide student of Indian Business Academy, Bangalore. He is presently pursuing Post Graduate Programme in Retail Management. He has submitted his project report titled “Catchment Area Analysis & Merchandising of FMCG-Food Products” in partial fulfillment of the requirement for the Summer Internship Project during the Post Graduate Diploma in Retail Management. This report has not been previously submitted as part of another degree or Diploma of any other Business School or University.

Prof. Hema .D, Indian Business Academy
Lakshmipura, Thataguni Post Kanakpura Main Road,
Bangalore – 560 062

INDIA
Tel: +91-80-28435931/32/33/34 Fax: +91-80-28435935

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Content

Part I - Corporate Analysis
Corporate profile - chapter I Business Model - Chapter II Functional areas or Department - Chapter III Merchandise Mix - Chapter IV Retail service Model - Chapter V Value Chain and Back end operations - Chapter VI Technology in Retail - Chapter VII Store Operations-Chapter VIII Learning Outcomes of Tasks

Page Nos.
8 28 42 43 52 54 56 59 62 64 67 72 95 96 97

Part II - Research Analysis
Review of Literature Methodology of the study Analysis of Data Limitation Finding & Conclusion Bibliography Annexure

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Part 1 – Corporate Analysis Chapter -1 Introduction Corporate Profile
Overview RPG Enterprises, established in 1979, is one of India’s fastest growing business groups with a turnover touching Rs. 15,000 cr. The group has more than twenty companies managing diverse business interests in the areas of Power, Tyre, Transmission, IT, Retail, Entertainment, Carbon Black, and Specialty. Wide-ranging businesses, growing returns and a reputation to reckon, makes working with RPG an enriching experience. Where entrepreneurial skills are valued, excellence is the by-word, and performance is a pre-requisite. Management The RPG Management Board is the backbone of the conglomerate. Its members are highly qualified professionals, well experienced in their respective fields. Values RPG’s business ethics promote higher levels of excellence. The group’s values of Customer Sovereignty, People Orientation, Innovation & Entrepreneurship, Transparency & Integrity, Passion for Superior Performance, Anticipation, Speed and Flexibility propel it to perform and excel in all spheres of the business. Quality RPG quality determines success. Continuous process improvements are carried out to ensure complete satisfaction of customer and market requirements. Beyond Business RPG is a socially responsible organization; believing in giving back to the community what it has gained from it. The group regularly contributes toward the welfare of various social groups and is involved in promoting social activities in the field of sports and arts. History
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

The history of RPG began in 1820 when Ramdutt Goenka, from a small town in Rajasthan, came to Calcutta to do business with the British East India Company. The following milestones speak of his enterprising efforts, and the subsequent growth of the RPG group. • By the 1900s the Goenkas establish themselves in diverse business sectors like banking, textiles, jute and tea. • Sir Hariram Goenka and Sir Badridas Goenka are conferred knighthood by the British for outstanding contribution to business and the community. • In 1933, Sir Badridas Goenka becomes the first Indian to be appointed Chairman of the Imperial Bank of India (now the State Bank of India). • He is elected President of the Federation of Indian Chambers of Commerce and Industry (FICCI) in 1945. • Keshav Prasad Goenka (son of Sir Badridas Goenka) continues the successful trait of entrepreneurship. • In 1950 Goenka’s acquire two British trading houses - Duncan Brothers and Octavius Steel. • After successful acquisitions in the areas of tea, automobile, tyre, jute, cotton textile and electric cables, Keshav Prasad Goenka retires in the 70s. His business is taken over by his three sons. • One of the sons, Rama Prasad Goenka (better known as RP Goenka), starts RPG Enterprises in 1979 with Phillips Carbon Black, Asian Cables, Agarpara Jute and Murphy India. • The 80s see further acquisitions by the RPG group, the first being CEAT Tyres of India in 1981. The group then went on to acquire KEC (1982); Searle India, now RPG Life Sciences (1983); Dunlop (1984); HMV (1988); and finally CESC, Harrisons Malayalam, Spencer & Co. and ICIM in 1989. • RP Goenka’s sons Harsh (Chairman) and Sanjeev (Vice-Chairman) spearhead the group’s management from 1990. • RP Goenka currently oversees the group’s affairs as “Chairman Emeritus”. Today, RPG has more than twenty companies across eight business sectors, with a Turnover of Rs. 15,000 cr.
Milestones

1863

John William Spencer and Charles Durrant open the first ever Spencer store in Chennai

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1920 1980 1989 1995 1996 2001 Spencer’s becomes the first grocery store in India Spencer’s becomes the first supermarket chain under Food World in India RPG Enterprises buys a majority stake in Spencer’s Spencer’s enters into a Technology Assistance Agreement with Dairy Farm International Holdings Ltd., Hong Kong, to set up the Foodworld chain of supermarkets in India First Foodworld store inaugurated in R A Puram, Chennai, by M. S. Subbulakshmi, renowned Karnatic musician First hypermarket inaugurated in Musheerabad, Hyderabad, by Krishna Yadav, Labor Minister of Andhra Pradesh 100th Foodworld store inaugurated in Pondicherry 2006 Joint venture with Dairy Farm International Holdings terminated First new store under the Spencer’s brand name inaugurated in West Mambalam, Chennai 2008 75,000 sq ft flagship store inaugurated at South City Mall, Kolkata First standalone store inaugurated at Vadodara Exclusive tie-up with £ 3 billion Woolworths plc, UK, for retailing their internationally acclaimed toy brand, Chad Valley, and their Ladybird brand of kidswear; the latter is Woolworths first international tie-up in the children’s apparel segment Tie-up with Au Bon Pain, the Boston-based fast casual dining and bakery caf é chain having more than 200 outlets in America, South Korea, Taiwan and Thailand Alliance with Beverly Hills Polo Club – its first international tie-up in fashion

Vision & Values We shall be a leading Indian Group with a focus on market capitalization through: ➢ Leadership in profitability and revenue growth in our chosen businesses ➢ Being a customer – centric organization and ➢ Being the most exciting workplace RPG Group is in following Areas of Business :

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1. 2. 3. 4. 5. 6. 7. 8.

Power Tyres Transmission IT Entertainment Carbon Black Specialty Retail

1. Power RPG Group has following Companies In Power Sector: a) CESC Ltd. b) Noida Power Company a)CESC Ltd. Profile Pioneer of electricity supply in India, CESC Limited commenced power generation and distribution in Kolkata, in 1899 with India’s first thermal power station. CESC, one of the few private power utilities, has since grown to a generating capacity of about 1000 MW across four thermal power plants. CESC is a vertically integrated Power Company and its operation encompasses coal mining, generation and distribution of Power. Today, the Company serves 15 million people spread over its licensed area of 567 sq. km in the twin cities of Kolkata and Howrah in the State of West Bengal, India. Poised for large growth in demand, CESC is setting up a number of power stations in the country. Operations
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Operating efficiency of CESC's power stations is amongst the highest in the country. Alive to its environmental responsibilities, its generating stations at Budge Budge, Titagarh and Southern have all attained 'zero effluent' environment friendly status. Budge Budge is also the first thermal power station in the world to have qualified for carbon credits under United Nations Frameworks Convention on climate Change. The Company has demonstrated notable success in controlling distribution losses. Services CESC's emphasis on constant up gradation of services to its 2.2 million consumers continues with a 24x7 computerized call center. Special care is taken for building consumer awareness on power consumption, safety issue and conservation of energy. b) Noida Power Company Ltd. Profile Noida Power Company Limited distributes power in Greater Noida, near Delhi in Uttar Pradesh, which is being developed as an industrial hub and an urban settlement. The Company, which has a customer base of approximately 50,000, reaches out to a population of 4.2 Lakhs spread across hamlets, villages and a new township spanning an area of 335 sq. km. The Company is a joint venture between the RPG Group, a leading business house in India and Greater Noida Industrial Development Authority, an autonomous body of U.P. Government responsible for town planning and infrastructure development. The venture marks the strategic entry of the Group into privatized distribution of electricity in North India. Operations The Company executed an Agreement with the erstwhile U.P. State Electricity Board (now U.P. Power Corporation Limited) in November 1993 for transfer of the supply arrangements and sourcing of bulk power. Currently, the peak load served is 90 MVA as against 18 MVA in 1994-95, reflecting a steady increase in consumer demand. The load profile is dominated by large and heavy industries that constitute 68% of energy sale and contribute as much as 74% of the Company's income. In terms of
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numbers, the Urban Domestic consumers constitute the biggest segment. The rural population consumes 9% of the energy demand and has agriculture as the main source of income. Urban, institutional and smaller industrial consumers account for the balance business. From the very inception, NPCL has focused on process innovations and business excellence to differentiate its service offerings and earn recognition in the industry. The leadership takes pride in the fact that NPCL has become a benchmark in the industry for the parameters such as Transmission and Distribution Loss (8%), Cost of Delivering Power to Consumer, Revenue Generated per Employee, etc. The Company has been recognised by the Union Ministry of Power for the innovative distribution practices in the rural areas and has also been awarded a "Silver Shield" for meritorious services in the area of rural distribution franchisees. Services NPCL has the principal role of a service provider to support economic and lifestyle activity in Greater Noida and to meet the broad needs of the community at large. Building an efficient and reliable delivery system has therefore been accorded top priority. A 24-hour Call Centre facilitates communication with consumers and helps improve trouble call monitoring. Complaint management is computerised, enabling call tracking from start to finish. To provide world-class service to its customers, the Company has invested in leading-edge technologies such as HVDS, SCADA, AMR, GIS and ERP, thereby upgrading its processes and systems so as to provide speedier and friendlier responses to its customers. Also, with effect from 23rd Nov. 2008, the Company has become the first and the only Power Distribution Company in India to achieve ISO 9001:2000 Certification for all its operations and support functions. 2. Tyres Company : CEAT Profile CEAT is a leading tyre manufacturer in India, and one of the most recognized brands in the country. The company also exports a range of tyres to over 130 countries. Operations

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CEAT has a wide distribution network of over 3500 dealers, 33 regional offices and more than 100 C&F agents. The company’s manufacturing plants are located in Mumbai and Nasik. Products CEAT manufactures largest range of tyres in the industry which incorporate both cross-ply and radial technology. The range of tyres covers virtually all user segments – from giant earthmovers to specialty tyres for scooters and motorcycles. The company also markets tubes and flaps. 3.Transmission RPG Group Companies in Transmission Sector are: a)KEC International b)RPG Cables

a)KEC International Profile KEC International Limited is one of the largest Power Transmission Engineering, Procurement & Construction (EPC) companies in the world. KEC has made an indelible mark on the world map by constantly and consistently re-engineering itself to retain its position of leadership in the areas of quality, technology, capacity and capability. KEC's strengths lie in the areas of Design, Manufacture, Supply and Construction of Turnkey Projects of Power Transmission lines of voltages up to 800 kV and in the execution of Railway Electrification projects, setting up Sub-stations and power Distribution Networks, Optical Fibre Cable (OPGW) installations, Turnkey Telecom Infrastructure Services and maintenance of Power Transmission Lines. To ensure reliable service, KEC is supported by multi-locational manufacturing facilities, over 60 stringing equipments and a workforce of about 2500+ employees spread over 20 countries. KEC has successfully executed contracts from 800 kV to 33 kV in India and abroad. Till date, KEC has laid down more than 60000 kms of transmission lines of 400 kV which is 1.5 times the circumference of the earth (40000 kms).
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KEC has gone from strength to strength successfully exporting its EPC services to over 40 countries and widening its client base across the world. The company has an increasingly strong presence in South Asia, Middle East, Central Asia and Africa. Recently, it also made a mark in North America and seeks to serve more opportunities in that region. During its six decades of existence, KEC has helped transmit power to various countries that include Argentina, Australia, Brazil, Canada, Egypt, Ethiopia, Ghana, India, Indonesia, Iran, Iraq, Kenya, Kuwait, Lebanon, Malaysia, New Zealand, Nepal, Nigeria, Philippines, South Africa, Sri Lanka, Saudi Arabia, Sudan, Syria, Tajikistan, Thailand, Tunisia, USA, UAE and Vietnam. Over 60% of the company’s revenue comes from the international market. KEC today, boasts of the largest production capacity in the world for tower manufacturing -- close to 200000 MTs. KEC accomplishes this using three state of the art manufacturing facilities in the strategically advantageous locations of Jaipur in Rajasthan, Nagpur in Maharshtra & Jabalpur in Madhya Pradesh. Besides, it also has three modern tower testing services at Mumbai, Jaipur and Jabalpur which are capable of testing towers up to 1000kV. The combined KEC has become a diversified infrastructure EPC global major with a stated mandate of “Building Infrastructure Globally”. Thus, from being principally a power transmission play, KEC is today operating through five major business areas: • Power Transmission – International • Power Transmission – South Asia • Distribution, Substation & Design Services • Telecommunications Infrastructure • Railway Infrastructure b) RPG Cables Profile RPG Cables manufactures and markets power cables in India. The company also exports cables to Sri Lanka, Malaysia, Russia, Zambia, Nigeria, Afghanistan, Mauritius and other parts of the world. The Company is certified for ISO 9001. Operations The company has production facilities in Thane, Silvassa and Mysore, where it manufactures high quality power and telecommunication cables Products RPG Cables is a pioneer in the XLPE range of cables in India, and offers a range of
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

cables up to 132 kv level. The company also manufactures optical fiber and PIJF cables. Products RPG Cables is a pioneer in the XLPE range of cables in India, and offers a range of cables up to 132 kv level. The company also manufactures optical fiber and PIJF cables. 4. IT RPG group has following companies in IT Sector: Zensar Technologies Profile Zensar is a globally focused software and services company spread across nineteen in the world, servicing over 280 active customers, providing end-to-end services from IT development to Business Process Outsourcing, from consulting to implementation. Towards supporting our customers in meeting their business goals, the Company has built and consolidated a comprehensive portfolio of services in IT and BPO that offer a sliding range of benefits along the value chain, from cost to value arbitrage from efficiency gains to lasting business impacts. Operations With more than 4600 associates and sales and operations presence across US, UK, Germany, Sweden, Finland, Middle East, South Africa, Hong Kong, Singapore, Australia, Japan, Poland and China. Services The Company delivers comprehensive services in mission-critical applications, enterprise applications, e-business, BPO and Knowledge Services and offers industry and business consulting with industry focused teams in Retail, Manufacturing, Banking and Insurance, Energy and Utilities and bringing in best practices culled from individual and combined experiences. 5. Entertainment : RPG Group has following Companies in Entertainment Sector: a) Saregama b) Open Media Network
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a) Saregama Profile Saregama India (popularly known as HMV), is an integrated entertainment company with the largest music archive in India, and associations with films, home video, television software and digital distribution of audio and video content. The company represents BBC World wide Home video in India, and is also active in related areas like artiste management, event management and theatrical film distribution. Operations Saregama has four regional offices in the metro cities and 13 branch offices. The company operates with over 200 distributors and dealers through a unique network of key accounts and corporate sales. Saregama’s marketing arms RPG Global Music and Saregama Plc cater to the international music markets that include the UK, USA, continental Europe, Canada, the Caribbean Islands, South Africa, the Middle East, South East Asia, Australia, and New Zealand. Products Saregama offers a wide collection of music cassettes, CDs, DVDs and VCDs, and has an extensive library of over 48,000 albums and 300,000 songs in 14 languages. The company caters to different genres of music from Indian classical to fusion and new age. In the digital space, the company has initiated retailing music through the Internet and satellite radio streams, digital downloads and mobile entertainment domains. Saregama’s extensive songs catalogue is now available online through an innovative venture called HamaraCD (www.hamaracd.com). This service allows music lovers to create a customized music CD and have it delivered anywhere in the world. b) Open Media Network Profile Open, the new weekly current affairs & features magazine is the first flagship brand from Open Media Network, the new media venture of RPG Enterprises (Rs. 15000 crore business conglomerate). Open, priced at Rs 30, was launched on 2nd April’09. So far 18 issues have been released in the market. Open has been designed to be an Interesting, intelligent and stimulating read for globally minded
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Indians who don’t like their news served up stale a week after the event.. And this is an outcome of Open’s strong editorial philosophy that it won’t repeat news that readers already know, that Open will constantly challenge the reader to rethink & to revisit and that it will contribute significantly to the additional knowledge needs of Indian reader. Its international design and uncluttered presentation enhances the reading experience of discerning readers. OPEN comes to the reader as three distinct magazines rolled into one. The first section, Small World, is a zippy 10-page selection of the most relevant and interesting news of the week from the world. The middle section has in-depth stories and features on politics, sports, entertainment, science, technology, societal trends, health, culture, and so on. OPEN ends with Mindspace, a section of literary essays, stories on books, art & culture, gadgets, celebrity gossip, science and Headstart, which challenges the reader with puzzles, mindgames and questions of ethics. 6) Carbon Black RPG group has following Companies in Carbon Black Sector: Phillips Carbon Black Ltd. Profile PCBL is a leading carbon black producer in India commanding around 41% market share. The company has also initiated power generation for captive consumption and sale to the power grid. PCBL earns Carbon Credits for this initiative and it is the first Carbon Black Company in the world to be awarded Carbon Credit under Kyoto Protocol of UNFCCC. RPG Group recognizing the major turnaround achieved during the last two years and the growth path PCBL has embarked upon to capture the opportunities in Carbon Black business has made Carbon Black an independent Business Sector w.e.f. 1st August, 2008. PCBL's endeavor is to achieve Leadership not only in terms of Revenue and Market Share but also in terms of Cost, Quality and Service which will ensure continuing Profit Leadership. PCBL stands for People Challenging and Breaking Limits. Operations
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PCBL has three manufacturing units located in Durgapur, Cochin and Baroda. Durgapur plant is ISO-9001 and QS-9000 certified. It has also received the TS 16949 in 2007 and has now initiated the Environmental Management System (EMS) activities for receiving ISO 14001 Certification. Both Cochin plant and Baroda Plant are ISO 9002: 1994 certified. Products The company designs, manufacturers and markets carbon black. The major market for Carbon Black is Tyre Industry. Carbon Black is also required by Non-Tyre rubber based application industry as well as the plastic industry. Corporate Social Responsibility (CSR) PCBL is a staunch believer in CSR activities. Its Cochin plant has bagged the Environment Management System (EMS) standard accreditation under ISO 14001:1996 and an award from Kerala State Government under large corporate category for best environmental practices in 2004. The plant has an on-line stack monitoring system with access to State Authorities, 250 Kms away. Cochin plant is the only Carbon Black Plant in Asia to have a solid waste disposal yard. PCBL follows a system of zero discharge of water outside the plant. Effluent is treated and reused. Regular community development is a way of life in all plants. Few of the practices followed are Pipeline for drinking water for school, free distribution of books, Merit Awards, Donation of ambulance, Total rain water harvesting etc. 7. Specialty RPG Group has following Companies: a) RPG Life Science Ltd. b) Raychem RPG c) Harrisons Malayalam

a)RPG Life Science Ltd. Profile
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RPG Life Sciences (formerly Searle India) is a wide-ranging pharmaceutical organization that focuses on current and emerging areas of health care. The company manufactures and markets a range of bulk drugs, formulations and biotechnology products. Operations RPG Life Sciences has research and development facilities that conform to international standards. It has Biotech R&D, API R&D and Formulations R&D. Each of those areas have their respective manufacturing facilities. The company has TGA (Aus) and MHRA (UK) approved facilities at Thane, near Mumbai and Ankleshwar, near Gujarat. b) Raychem RPG Profile Raychem RPG Limited was incorporated in 1989. Raychem RPG is a 50 : 50 Joint Venture between RPG Enterprises, India and Tyco Electronics, U.S.A Operations The company’s manufacturing plants are located in Vasai, Kaman, Rabale, Chakan (in Maharashtra State) and Nalagarh (in Himachal Pradesh). • The Vasai Unit, a 100% Export Oriented Unit, was set up to manufacture heat shrink moulded products for Tyco Electronics – Energy Division, thus becoming a sourcing hub for distribution to various parts of the world. • The Chakan Unit was set up to exclusively cater to new projects and product development. Currently the facility houses two manufacturing plants for: ○ Domestic Gas Flow Meters ○ Industrial Transformers • The Nallagarh Unit houses two plants for: ○ Distribution Transformers ○ Energy Meters c) Harrisons Malayalam
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Profile Harrisons Malayalam Limited is India’s largest rubber plantation company with nine major rubber plantations, and the second largest tea producer in south India, owning 10 tea plantations. The rubber and tea plantations are spread over more than 20,000 hectares of land in South India. Products The two main products of Harrisons Malayalam Limited are tea and rubber. Types of tea produced include crush, tear and curl (CTC) and orthodox dust tea. Mountain Mist, Harrisons Gold, Spencer’s and Surya are well established tea brands in South India. The company’s value-added rubber products include centrifuged latex, PLC, crumb rubber, crepe rubber and technically specified rubber. Harrisons Malayalam Limited is also India’s largest producer of pineapples. 8. Retail RPG Group has following companies in the Retail Sector: a)Spencer’s Retail b)Music World c)Books and Beyond a)Spencer’s Retail Profile Spencer's Retail Limited is one of India's largest and fastest growing multi-format retailer with 250 stores, including 36 large format stores across 66 cities in India. Spencer's focuses on verticals like food and grocery, fruit and vegetables, electrical and electronics, home and office essentials, garments and fashion accessories, toys, food and personal care, music and books. Established in 1996, Spencer's has become a popular destination for shoppers in India with hypermarkets and convenient stores catering to various shopping needs of its large consumer base. Operations

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Spencer's has retail footage of over 1.1 million square feet and over 250 Spencer's stores in 50 cities. The company operates through the following formats: • The Spencer's Hyper stores are destination stores, of more than 15,000 sq. ft in size. They offer everything under one roof. The merchandise ranges from fruits & vegetables, processed foods (Ready to Eat, Ready to Cook, FMCG products),specialty foods including international, sugar free, organic foods, etc...groceries, meat, chicken, fish, bakery, chilled and frozen foods, garments, consumer electronics & electrical products, home care, home décor & home needs, office stationeries, soft toys. Besides, the stores also comprise book & music retailing, electronic gadgets and IT accessories. On an average, a Spencer's hyper stocks 70,000 SKUs across 35,000 items. • The Spencer's stores are neighborhood stores ranging from 1500 less than 15000 sq. ft. These stores stock the necessary range and assortment in fruit and vegetables, fmcg food and non-food, staples and frozen foods and cater to the daily and weekly top-up shopping needs of the consumer. Some of these stores which have floor area of more than 10,000 sq ft sometimes offer home care products; personal care products, bakery, chilled and frozen food; baby care, basics in garments and limited range of electronics and electrical. b)Music World Profile Music World is India’s largest chain of music stores retailing the widest range of music & home video products (International and Indian). Operations Music World operates different store formats to service different consumer groups. Products Music World's product portfolio comprises of audio CDs, DVDs and VCDs, CDROMs, Playstation/ PSP Consoles & software, X Box console & software , Nintendo WII console & software, and other music accessories. The company is an important player in the home video market. Music World has successfully forayed into high end ‘personal audio’ gadgets like Apple iPods, Neo Pods, MP3/MP4 players. The company also offers DVD players, home theatre systems, speakers and headphones. Music download is also available at select stores. The company now provides recharge vouchers of all telecom service providers, DTH service providers & world calling cards. c) Books and Beyond
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Profile and Range Books & Beyond, a new vertical of Spencers Retail, is positioned as a “community engaging store”, that offers a wide selection of reading options, a comprehensive selection of toys (including the recently launched Chad Valley range form U.K.) and the entire gamut of art and stationery related merchandise for home school and office use. Books & Beyond offers an internationally designed, vibrant and engaging store environment with consumer activation events like author appearances, music releases and children’s activities that ensure that customers have a complete shopping experience. A feature of Books & Beyond stores is a unique search facility which shoppers can use to find books of their choice. Books & Beyond undertakes, at no extra cost, to source those books requested by shoppers, should they not be readily available instore. Operations The first store of Books & Beyond was launched in 2007 at the Megacity Mall in Gurgaon, near Delhi. The company has aggressively extended the footprint of Books & Beyond ever since, with stores in Kolkata, Chennai, Bengaluru, Hyderabad and Chandigarh. The latest Books & Beyond store was launched in Jamshedpur on November 7, 2008. Products Books & Beyond stores have unique collection of Books, Stationeries & Toys

RPG Group Beyond Business: For RPG, responsibility towards the betterment of society is as important as doing business. The group is an aware and active part of the community, and supports various social initiatives.

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The social endeavors of the group include: providing employment and education for the under privileged, promoting rural development, and nurturing a pollution free and eco-friendly environment. The group is also actively involved in: • supporting art and artists through the RPG Academy of Art and Music • encouraging cricketing talent through the CEAT international and domestic cricket rating and awards • promoting research on macro issues through the RPG Foundation a) Corporate Citizenship Through its different activities, the group seeks to promote and sustain social development.










Relief activities: KEC International Ltd has stood up in the hour of need and initiated an effort to provide relief to the people struck by the catastrophe of floods in Bihar. Over 2,500 employees of the company are making the operation successful by donating their one day's salary matching the company's contribution. Plastic Tarpolin, Saree, Lungi, Mosquito Net, Towels, Soaps, Biscuits, drinking water, baby food, medicines are being provided to the people rescued from the affected areas. Education and Vocational Training: RPG provides facilities and staff for training students pursuing professional courses at leading colleges and technical institutes. The group has also started primary schools in some areas. Health: Promotion of health is of prime importance to RPG. The group’s employees regularly organize blood donation drives and health camps. Community Development: Development of the society is one of RPG’s prime concerns. Through its many activities the group is actively involved in rural development, women’s welfare, sports and cultural events for the employees, disaster management and supporting the under-privileged. Environment Protection and Conservation: RPG makes conscious efforts toward protecting the environment. In its attempt to develop green belts, the group has successfully converted wet grassland into lush gardens. Water harvesting and re-cycling are two important activities undertaken by RPG for water conservation.

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a) RPG Foundation The RPG Foundation is a think-tank engaged in research on macro-economic issues, mainly concerning the industry and the corporate sector. Some of the activities undertaken by the Foundation are: • Examination of bills and reports on economic issues that are introduced in the Parliament. • Analysis of reports by government committees/institutions, to understand the implications for industry and trade. • Creation of case studies for use in corporate management. • Collection, collation and analysis of data on various economic topics, to anticipate trends in prices, interest rates, exchange rates, external trade, economic growth, etc. • Production of the monthly publication ‘State of Business’ for use by corporate executives. • Bringing out opinion based articles on macro economics. a) RPG Academy of Art and Music RPG is a keen promoter of art and music. Group chairman Harsh Goenka, a reputed and ardent collector of art, believes in creating a work environment conducive to creativity. All group offices display fine pieces of art by Indian masters like M F Husain, Raza, Laxman Shreshtha, Bikash Bhattacharjee, Jehangir Sabavala, and several prominent young artists. The RPG Academy endorses contemporary Indian art, and regularly sponsors art exhibitions of young talented artists at the prestigious Jehangir Art Gallery in Mumbai. These exhibitions have been immensely popular with art lovers, and have garnered a good response. Following are some of the exhibitions held by the group in the past. • Amazing, 2008: Amazing, an exhibition held in 2008 by RPG Academy of Art, featured work of 27 artist both young and established • Sacred Space, 2004:showcased the spiritual and the profane identities of Indian religious culture and belief. • RPG Collection of Contemporary Bengal Art, 2003:held at the prestigious National Gallery of Modern Art (NGMA), Mumbai. • Mela: A Carnival of Indian Art, 2002:a unique show that celebrated the diversity and spontaneity of Indian art and artists.
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• Self-Portraits & Bombay Artists- Progressive Perspectives, 2001:featured works of 30 Mumbai artists from the RPG collection. • The Flashback- Flashforward Exhibition, 1999:an interesting look at the past, present and future of Indian art. • The Bombay Show, 1998: showcased Mumbai’s diversity on canvas. • 50 Years of Freedom of Expression, 1997: a unique exhibition to commemorate the 50th year of the India’s independence. • The Mother Theresa Exhibition, 1996:an expression of prayer from the RPG Academy for her recovery. • The Bombay- Exhibition, 1995:an exhibition of modern paintings and sculptures that showcased the spirit and diversity of the city of Bombay. • The Annual RPG Art Camp:an annual event, where artists from across the country come together to live, paint and interact with each other at Marve Beach, Mumbai.

Chapter 2 RETAIL FORMAT AND BUSINESS MODEL Retail format type
In the Indian milieu, there are only two routes to survival – discounting and differentiation. Most retailers choose to play the price game. We, however, preferred to focus instead on establishing ourselves as the preferred shopping destination for discerning young customers looking for a range of quality products that let them participate in a global lifestyle.
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Our brand positioning – Taste the World – embodies this unique approach, promising consumers a fun-filled shopping environment with the best that the world has to offer in terms of interiors, ambience and merchandise. The following characteristics distinguish the Spencer’s brand and create memorable 360° shopping experiences for consumers: • Products – we offer the widest range of food and lifestyle (fashion, home, entertainment) brands, with a special expertise in food • Quality – we lay a huge emphasis on all-round quality: in products, stores, service standards, and customer engagement programs • Heritage – we are India’s oldest retailer, with many firsts to our credit • Multiple Formats – from daily to weekly and specialty shopping, we fulfill every need and provide maximum convenience • Promotions – we seek to offer the right products at the right time at the right price, with promotions carefully designed to suit the buying cycle and shopping basket of the consumers • Brand Imagery – our stores and staff seek to make our customers feel right at home, being international, contemporary, accessible, empathetic and trusted

As the pioneer in organized food retailing in India, the modern-day Spencer’s started operations back in the early 90s, in South India. We run more than 275 stores across 50 cities in India. Currently, we offer customers two retail store formats: • Convenience stores, called Spencer’s • Hypermarkets, called Spencer’s hyper Spencer’s: Spencer's are neighborhood stores that cater to the daily and weekly top-up shopping needs of consumers. Ranging from 1,500 to 15,000 sq. ft. in size, they stock, at minimum, an assortment of fruits and vegetables, food and non-food Fast Moving Consumer Goods, staples and frozen foods. The larger of these stores, having a floor area of more than 10,000 sq ft sometimes offer a selected range of baked, chilled and frozen foods;
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personal and home care products; baby care; basic apparels and electronics and electrical. Spencer’s Hyper: Spencer's hyper are megastores, which combine a supermarket with a department store. At least 15,000 sq. ft in size, they stock, on average, 70,000 items, giving shoppers fantastic deals across food, fashion, home and entertainment all under one roof. Spencer’s hyper are destinations for more than just shopping. Country and theme festivals, the Spencer’s Chef Corner with master chefs showing you how to prepare exotic dishes, Modern Menu – our in-store food court, wine or cheese tasting sessions … there’s always something extra happening at a Spencer’s hyper.

Spencer’s Hyper Lucknow
RPG Enterprises opened the first Spencer’s hyper store in Lucknow on 4th July 2007. This was the fifth Spencer’s store in the city under the different formats of express, daily, super and hyper stores. The hyper store at Lucknow is spread across 40,000 square feet, offers 25,000 products from groceries, fresh fruits and vegetables to processed foods and personal care products. Apart from this, there are garments, electronic goods, home care products, toys and home décor. These departments have been given right
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amount of area in the stores so as to carry their part of business. The following chart will show the Area analysis according to the Departments in Lucknow Spencer’s Hyper.

Display in Spence’s Hyper Lucknow: Spencer believe that Store Display must reflect our positioning towards our customer by • showing clearly and comprehensively our range • giving all necessary information's: Price, Promotion Scheme • Enhancing our promotions. • optimizing the space available • Creating a volume effect encouraging the sales. • facilitating our customer shopping – i.e.: Heavy product at the bottom, Freshness maintained, Impulse near the cash counter Basic Display Items used in Spencer’s are as follow: • Shelf : A platform to place products • Bay : A Set of Shelves • Gondola : A Row of Bays • Gondola End : End of a Gondola • 5 Tier bin : Movable Bin

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• Impulse Bin : Bay of 4 feet height to enhance impulse purchase • Floor Stack : Stacking on the floor stands

Gondola

Aisle

Gondola Row of Bays

Gondola End

Shelf
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Bay –set of Shelves
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Impulse Bins

Low Price Impulse Products

High Pilferage Products High Value Products

Five –Tire Bins
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Merchandising Policy
MERCHANDISING PROCESS • • • • • • • Vendor Source Identification Vendor Criteria Negotiation Goods Returned to Vendor Stock Working Capital Tie-up Reports Job Routine for Merchandiser

Vendor Source Identification

The following methods are used to identify the vendor source:

• • • • • •

Buy samples of the product and getting in touch with the manufacturer as listed on the label. Go through the yellow pages. Visit exhibitions/trade fairs. Ask existing vendors if they know a supplier for the product. Approach other people who may use the product in manufacturing-example asking a bakery for a supplier of food colors. Go with the same vendor as one of our sister concerns.

Vendor Selection Criteria

The criteria for selection of vendors should be the following but not necessarily in this order:

• • • • •


Reliability Lead time for supply Credit terms Price Quality
Service History



Physical infrastructure to hold stocks.
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• • • • • • • •

Market Credibility Allowances passed on to SPENCER’S. Exclusivity (if applicable) Facilities provided - Transportation / repacking etc Long-term relationship. Compliance with statutory requirements. Flexibility to understand and cater to the requirements of a fast growing organized retail chain. Preference to SPENCER’S in case of a short supply in the market.

After selecting the vendor, the following points must be considered.

• It is essential to have a fall back option, if something goes wrong in dealings with the first vendor. • Other things being equal, it is always better to select a vendor who can offer two or more product ranges. This will save time and effort from our side, and also generates larger volumes for the vendor, as a result, he will be more willing to devote time and energy towards our account.

NEGOTIATION

Negotiation is one of the core tasks carried out by the merchandising team. Negotiation is a continuous process and starts before the introduction of an SKU and goes on forever. The objective of the process is clearly to get a “better deal” for the store.

The ability to persuade others to your point of view is a practical skill that comes with experience. Given below are some tips for good negotiation: • • • • • • • Always prepare for a negotiation. Try to understand all aspects that would be discussed. Think of all possible outcomes and devise a strategy. Communicate what you want clearly and precisely. Never feel intimidated. Recognize when tactics and ploys are being used against you. Always look for a win-win situation.
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The following must be clearly kept in mind during the process of negotiation:

• • •

The ultimate objective is to form a long-term business partnership. The short term interests must on no account over-ride long-term business objectives. The SPENCER’S merchandising team must at all times be seen as fair in all dealings.

The points that are generally covered as a part of a negotiation are:

• • • • • • • •

Price of the product. The components of the price as borne by the vendor/SPENCER’S The quality and size specifications. Packaging specifications. Delivery lead-time. Buffer stock to be maintained by vendor. Credit period. Handling of damaged/unsold stock.

Discussions with company personnel must be centered around the following:
• • • • •
• •

Cost Price: Price at which we purchase. M.R.P.: Marked Price at which the SKU is generally sold. Gross Margin (Mark-Down): Total Margin given by the Principal/Supplier. Trade discount: Extra margins given for specific purposes either in monetary terms or through free products. Volume / Qty. discount: Extra margin given, linked to the quantities purchased.
Seasonal discount: Special discounts given, mostly during off season. Promotional Allowances: Allowance given by the Company to conduct a promotion.

• • • • • • • •

Cash discount: Extra discount given for immediate payment. Distribution Allowances: Extra allowance given to compensate for our efforts in distribution. Fill rate Allowance: Allowances for better fill rates at the stores. Quarterly / Annual Incentives: Incentives that are passed on for achieving quarterly / yearly volume targets. Ullage/shortage allowance: Allowance provided to handle unintentional shortages / damages in intact case. Damaged Goods Return. : Allowance given to compensate for damages, if the Company does not exchange the damages. AD spend: Allowances paid for our spends on advertising. Event budgets: Sponsorship for events.
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Fair space terms: Allowances for quantity and quality of shelf space.

Goods returned to Vendor

• • • • • •

At store Stock damage may happen because of breakage of packs and outdated stocks or as goods returned by the customer after purchase. All these goods should be returned to the supplier. There is also the issue of shortage and damaged goods, which come unintentionally and are not checked as they are part of an intact case. Vendor companies have their own policies on handling damaged goods and shortage. It is up-to the merchandiser to weigh these options and choose what is best suited for the store. The issue of damaged goods and unintentional shortage should be cleared off at the negotiation stage itself, so that Spencer’s does not stand to lose in anyway. In case the vendor has a policy of not accepting any returns, the merchandising manager should secure a discount under this head. Merchandising Manager should negotiate a damage allowance to take care of all the documentation procedures that we follow in case of goods returned to vendor.

STOCK AND WORKING CAPITAL TIE-UP
One of the main responsibilities of the merchandising team is to provide products at the right time. 'At the Right time' refers to providing products when the customer wants them. There are products where the brand is so powerful or there may be no substitute for the product. In these cases, if customers do not find the products they want, apart from the store losing sales and profit, it damages the reputation of the store and dissatisfies customers. Hence it is very essential to make sure that the store is not out of stock at any point of time.

It is entirely the Manager’s / Replenishment Officer’s responsibility to make sure that all SKU’s are available at the store at all times and is displayed in their respective shelves. Since demand is uncertain, it is absolutely essential to have some excess stock. But carrying excess stock involves
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a cost - inventory costs, storage costs etc. At the same time, we don’t want to lose sales due to stock outs.

This requires a balancing act to be performed - and inventory levels should be based on the type of product, the time of the month (beginning or end of the month, middle of the month, weekends), promotions, expected festive sales and shelf space availability and lead time.

Lead time refers to the time taken by the vendor to supply goods from the date of placing the order. It is again the Replenishment Officer’s responsibility to keep pushing the vendor to reduce his lead time. This would go a long way in reducing stock holding and at the same time avoid stock outs.

Working Capital Tie up:

The Manager has to be very careful while fixing Credit days. Credit days should be fixed based on expected sale and lead-time. The Merchandising Manager should always aim to work with a negative working capital.
Concessionaire • Concessionaires are vendors who are given exclusive rights to sell a particular product in an allocated area inside the store premises. • The concessionaire is responsible for sales. Agreements are signed with them. • Agreements are based on a minimum guarantee, which they pay for occupying space and/ or a margin on actual sale. - Important: Concessionaires should not be allowed to start operations without signing the agreements. • Only the head of Legal department in the Corporate Office must sign all agreements with concessionaries. • The original copy of the agreement would be in the custody of the head of legal and the copy of the same shall be in the respective store with the Business Manager. Concessionaire viability Template – When? • • • • “Concessionaire viability” cannot be a post-mortem activity, it must be carried out at the time of initiation of a dialogue with the vendor. ZMM / Business Head to keep the ZCM in loop at the time of starting of the process. If possible, ZCM to accompany the ZMM/Business head at the time of negotiation. We must insist on security deposit from concessionaires, the billing of which is not done by us.

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products • We should try for security deposit even from those concessionaires whose billing is done by us as the billing amount with us may be only for 15 days.

Cash receipts from concessionaires

• • • • •

Avoid cash receipts from concessionaire. Maintenance of a safe cash register is mandatory. Cash verification is to be carried out daily & recorded. ZCM / HO Commercial & Internal audit must review this during visits. Rent from concessionaires must never be taken in cash. A&P recovery in cash must not be done. Cash transactions: - To be avoided as far as possible. - In unavoidable situations, such cash must be accepted with prior approval of Zonal Business Head / ZCM and in his presence only. - Cash register to capture such receipts accordingly.

New product standards

• • • • • •

Products of any new National/ regional /local company cannot be introduced without securing the company code from Corporate Merchandising. The Company Code form should be filled up and sent / e-mailed to Corporate Merchandising which shall send approval / disapproval within 24 hours. If the product of a new company does not meet the average gross margin of the sub – category, it should not be considered. If the product is of an existing company and it is entering the sub - category for the first time the same rules apply. If the product of an old company already exists in that sub - category the gross margin on the new product should at least match if, not exceed the gross margin on the existing product. The Manager should also vigorously explore the possibility of replacing an old product with the new product if that is what the company is ultimately proposing to do.

New product launch Plan



Once the launch details are finalized, the Manager briefs the Operations team, the Warehouse Manager and Marketing on the following:
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 Launch Plan  Factors to be arranged for - Posters, Sampling, etc. with details of dates.  Brief description of the product in terms of its specialty. In case of a new sub category, this would have to be supplemented with a detailed write up.  Schedule of implementation: PI Labels, First dispatch from the warehouse, etc.  Plan-o-gram changes.  Special display requirements - Alligators, floor stacking, etc.

REPORTS

Reports that the merchandising team should be able to access are:

1. SAL1 – SKU Wise Sales 2. SAL2 – Sub Category Wise Sale 3. SAL3 – Category Wise Sale 4. SAL4 – Major Category Wise Sale Merchandising Efficiency

The efficiency of the Merchandiser is shown in the following areas: • • • • Analyzing Margins - Weekly & Monthly report Maximizing Display Income – use the display contract form At Vendor Company review meetings discuss Fill rates, sales. Store Visits  To check the availability of the products  To check the availability of promo SKUs,  To check the availability of POP to support the promos.  Merchandisers must make use of the Merchandisers store walk at every visit. Providing launch support during the new store opening  Master finalization  Layout finalization  Offers finalization  Stock planning at DC  Planogram  Top sheets



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JOB ROUTINE FOR MERCHANDISER

Job routine for the merchandiser should be covered the following:

• • • • • •


• • • • • • •

Review Store Walk Vendor Meeting/ Negotiations / NPI / Promotions planning etc. Sales / Category Review / Payment Review/Vendor Performance Review With Operations Manager / Buyers in respect to Stocks and Sales and Promotions Action on Stock outs Generate PO’s Stock Aging Over stock/Under Stock MBQ review Follow up on delivery of goods Vendor Scheduling Take feedback from store and Merchandising Managers on Market/Competitor Info/ Stock Outs/Fast Moving/Slow Moving Do the Merchandiser Walk regularly without fail

Location strategy: As Spencer’s hyper is a Hypermarket so it covers the radius of 5km for its catchments, and the stores are opened in such places where the store can be easily accessible and customers can be easily tapped.

Chapter 3 Functional areas
Organization structure

Spencer’s is one of the leading retail chain in india Spencer’s follows Top-To-Bottom down approach in their organization structure.
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They have: 1. Store Manager 2. Department Manager 3. Asst. Department Manager 4. Promoters 5. Staffs This is the hierarchy which Spencer’s follows.
List of functional areas The Functional Area of Spencer’s is:

1. Human Resource Management 2. Marketing 3. Inventory Management 4. Logistics 5. Warehousing 6. Visual Merchandising 7. Security

Chapter 4 MERCHANDISE MIX Merchandise Overview The products in Spencer’s hyper Lucknow Store are divided into 7 Categories:

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Each Category is further divided into Sub Categories

Assortment

Prepare an assortment calendar:

READY FOODS

JAN,APR,JULY,OCT

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products INSTANT FOODS BEVERAGES HOUSEHOLD NEEDS (CLEANING AIDS) FEB, MAY, AUG,NOV FEB, MAY, AUG,NOV JAN, APR,JULY,OCT

TOILETRIES BEAUTY AIDS

MAR, JUN,SEP,DEC MAR, JUN,SEP,DEC

Range Rationalizing
• • • • •

Range Rationalization is the process of weeding out non-performing and non-contributing SKUs. This exercise is done every quarter. Data of past six months and subjective view to be taken into consideration and this will be based on CRM. This process of deleting SKUs should not compromise the sale and margin of the sub category, but should ideally enhance both. Shelf space is a Fixed Commodity and to accommodate new products on the shelves, it is essential to keep deleting non-contributing SKUs to provide space for new and better performing SKUs. Leads to low inventory level. No dead stocks.

Process of Assortment

• Choose the category and the sub category as defined in the Assortment calendar. • Study quantity based CRM at sub category level. • Focus on Rehabilitate /Underfire, if there is proliferation of the SKUs in Maintain & Grow, it should be included in the analysis. • Setting up standard parameters for Deletion/Non Deletion Criteria: • LOW SALES Page 42

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products • • • DISCONTINUED BY THE SUPPLIER OFFER PACKS/MULTI PACKS ETC DUAL CODES/WRONG CODES

Final check – Data Check • • Renegotiate • • • Did the deletion result in higher GM% What was the loss in terms of sale quantity and rupee gross margin due to deletion? With the supplier / manufacturer for higher GM%. This is the best time to negotiate from our point of strength. Inform the buyer in writing – 10 -15 days in advance.

Logic and plan for Deletions
• • • • • Based on the past 6 months data, SKUs are sorted on sale and gross margins and those SKUs, which are contributing to neither, will be deleted. A subjective view also needs to be taken before deletion of an SKU for there could be other reasons for an SKUs non performance like stock out, poor visibility etc. Then Manager prepares a detailed time-bound action plan to dispose of stock of these SKUs, which may be lying either at warehouse or store and circulates it to all concerned. Stock of these products should be liquidated within one month from the date of moving it into system deletion location. At no point, shall a new product be deleted within three months of its introduction.

What not to delete

• • • • • • •

Range Building SKUs New SKUs-– THRESHOLD LEVEL IS 6 MONTHS Seasonal SKU - DO NOT DELETE - DEACTIVATE Fill rate less than 70% Large sale quantity/ value High Gross Margin % - DEBATE NOT DELETE Vendor Relations

Deletion process step by step
• • • • • • • Examine the CRM for the quantity only…. unless there is a good reason to check on value. Ascertain that the SKU is a typical rehabilitate. Place SKU in system deletion location and Stop buying Make SKU availability ‘N’ Check the stock level at warehouse and store The warehouse stock is to be pushed to the store or returned to the supplier If the stock does not sell, return stock to supplier Page 43

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products • • • • • • If supplier does not take returns, push stock to store on promotions Keep indenting of store to warehouse open till stocks last in warehouse When store and warehouse stock = 0, stop indent Once the stock is liquidated, delete SKU from master. Remove the SKU from the vendor list Change plan-o-gram accordingly

Support level

Support level of Spencer’s Hyper is quite well. Support level from everyone is satisfying, either it is staff or it is from merchandise or anyone else. Spencer has trained staff members to give support to the organization to run the business smoothly.

Quality level

The quality level of merchandise in Spencer‘s is good for different merchandise. Generally customers are satisfied with the quality level of merchandise.

Chapter 5 Retail Service Model
RETAIL SERVICE OVERVIEW As big bazaar is the part of future group. Big Bazaar provides many kinds of services to the customers, who come to shop in the store. It provides following kind of services to the customers. (1) Trolleys (2) Baskets (3) Bags (4) Drinking facility (5) Sitting facility (6) Customer service desk (7) Exchange facility (8) Home delivery (9) Music for entertainment (10) Paging
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TYPES OF RETAIL SERVICE (1) Trolleys Spencer provides trolleys to make shopping convenient. In trolleys customer puts merchandise which they buy. (2) Baskets Spencer provides baskets to make shopping convenient. (3) Bags Spencer provides Bags to make shopping convenient. (4) Drinking facility Spencer provides drinking water to the customers. (5) Sitting facility Spencer provides Sitting facility to the customers. (6) Customer service desk It solves the problems of the customers. It gives credit note. Credit note is a kind of cash which is given to a customer which got wrong bill or any case like that, through which he/she can buy anything from store. The amount in the credit note is adjusted in the new bill. (7) Exchange facility Spencer exchanges the product which has manufacturing defect. (8)Home delivery It gives home delivery in case of furniture & electronics also (9) Music for entertainment It provides music for the entertainment of the customers. (10) Paging Spencer made announcements to aware the customer’s about the current offers.

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Chapter 6 Value Chain and Back end Operations
Value chain overview Value chain is divided in three Different Stages these are: 1)Choose the Value


• •

Customer segmentation: Spencer’s target those customers who are looking for a range of quality products and great service Value positioning:- They Position themselves as store where you can get products at cheap price. Market selection/focus: They go for mass marketing

2)Provide the Value


Product development : The have private levels they manufacture it and sell these.
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products • • •

Service development: Home Delivery is provided for Furniture & Electronics Products. Pricing: The Prices are decided by the Zonal Office. Sourcing: The products are sourced form different Vendors.

3)Communicate the Value •
• •

Sales force : Big Bazaar has skilled Sales Force for every department. Sales promotion: Sales Promotions are being done by Marketing People they all are responsible for all sorts of promotions. Advertising: Advertisement being given different Newspaper and T.V Channels & hoardings are being displayed at different places.

Logistics: The merchandise which come is checked by both the People of the store and the person who has brought the merchandise, then the different Department Managers are being informed that their stocks have arrived and then the Department Managers cross checks the Stocks. All the details of the products are inwarded into the system. Warehousing: Spencer’s has a warehouse in Lucknow to serve the demand of various stores. The merchandise moves from the warehouse on the demand which has been made by the different stores and this demand comes through the regional office.

Inventory Inventory is managed by Regional office they send the products to Spencer’s and the inventory manager just matches the inventory and if there is any miss-match it is being maintained in the discrepancy book and for the perishable items only intend is being made by the respective Department manager.

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Chapter 7 Technology in Retail
Overview of Technology: Every organization is dependent on the technology and they can not survive without it. It assists in doing the work in productive way and to give better result so we can not think work being done without it. Retail software Application:

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This is how the IT works and this is the model on which it operates. IT application is everywhere and it can not be ignored. Retail software Modules: REM 4.30:- Retail Enterprise Management SEAGULL – (Barcode Package)

Retail software Analytics (Major areas):

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Retail hardware solutions:

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Barcode: There is Barcode Reader and the package used to read barcode is SEAGULL. Every merchandise has barcode on it and is given by the company. Knowledge management initiative:

Training is given to the staffs on how to operate on different modules and thus they get acquainted to the technology

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Chapter 8 STORE OPERATIONS Overview of Store operations
Store operations include activities that are done to run a store successfully. It includes (1) Selling of the merchandise (2) Display of the merchandise on the floor (4) Visual merchandise (5) Handling of the customers (6) Providing right information of the offers (through paging) (7) Helping customers in the shopping The departments that are responsible for the operations in the store are as follows: (1) Management team or operations team (2) Logistics department (3) Maintenance department (4) Information technology (IT) (5) Customer service desk (6) Administration department (7) Human resource (HR) department (8) Cash department (9) Commercial department (10) Visual merchandise (VM) (11) House keeping department (12) Security department (1) Management team or operations team It is the team of the staff members that handles operations in the store or manage store which include selling of the merchandise and display. It includes team member (TM), Team leader (TL), Assistant department manager (ASM), and department manager (DM).

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(2) Logistics department Send from warehouse Truck Stock receiving at store warehouse Cross checking Kept in the store warehouse

Taken to floor − bills send to the commercial, from that it is send to vendor (3) Maintenance department • • • All lightings, A.C., electrical equipments Fixtures Connections to all systems

(4) Information technology (IT) • All hardware • Offers, offer updation • Report generation (5) Customer service desk ─ solving the problems of customers (6) Administration department ─ All the housekeeping, security staff (7) Human resource (HR) department ─ Issues related to the staff (8) Cash department •


Billing, maintaining cash Reducing the shortages

(9) Commercial department All the issues related to the tax deposit, giving salary, etc (10) Visual merchandise (VM)
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Display of the banners, merchandise (11) House keeping department Cleaning, supporting the staff in the store (12) Security department It’s main work is to prevent shrinkage or theft It is of two types: (1) Front end (2) Back end The main job of category is to procure Front end analyze sale of merchandise and give feedback to back end category. Category Management in terms of, Managing Category on floor in terms of: 1. Display 2. Fast moving & slow moving. 3. Shrinkage 4. Shortage & excess

Category management

Learning outcome from the Task

Nature of Task Spencer’s Hyper--Lucknow Page 54

Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

I was doing market research for Spencer’s hyper Lucknow in this research I have done two project that is Catchment Area Analysis for the store & Merchandising of FMCG-food products. Then I was in operations that are in it I was learning the selling techniques and what are the customers’ preferences what do they like and which products lure them and what display do they like. Roles and responsibilities  Market Research for Spencer’s Hyper Lucknow  Operations  Merchandising of FMCG-food Products Key learning’s  Floor selling  Customer interaction  Section knowledge  Different LOBs and their sub divisions. Floor Selling Floor selling is not just selling the available merchandise to the customer. But it also involves:  Proper staging of the merchandise  Proper display of the merchandise  Putting proper signage and tags  Keeping proper check on availability of stock on floor  Keeping check on shrinkage

Customer Interaction When I was on the floor for the purpose of selling, customer interaction becomes an integral part. Proper customer interaction plays a pivotal role in todays competitive retail scenario. I involved myself in this aspect by giving a warm welcome to the customers coming to my section. My insisted primarily on knowing the customer’s need and wants and accordingly assisted them by showing appropriate product. In addition to that I use to inform customers about the various offers and discounts going inside the store. I don’t have any hesitation in saying that I met to the customer’s acceptance. Section Knowledge During my internship the section I have been through is FMCG-food
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Lines of Business (LOB) LOB refers to the main divisions under which the merchandise in the Spencer’s is broadly categorized and refers to the main business line under which a particular retail organization operates. The Spencer’s Hyper Lucknow has been divided into following Lines of Business: • • • • • • • • • • • • • Furniture HWP(Commodity / Home) Life Style Garments Music World BFS Cosmetic(Flower/Jewelry) Fruits and Vegetable International Food Personal Care Staples FMCG E&E

PART -2 Chapter 1 Review of Literature

1.

Catchment Area Analysis:

Retail Analysis is an inherently complex and dynamic issue because of interactions that occur between different retail centers. If all retail centers were alike, offering exactly the same shops

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

and services with regards to price and quality then we could assume that the population within the catchment would spend all of its money in the nearest centre. However, different centers are not the same and people’s mobility means that they will often travel to their preferred destination instead of their closest one. Changes in population, access and retailing also alter relative attractiveness. An important element of the study is therefore to provide a robust assessment of the current catchment area of the city, taking into account different types of retailing such as food and non-food, with the latter disaggregated into bulky and non-bulky goods.

Factors that influence consumers’ decisions on where to shop include: • Presence and strength of ‘anchor’ traders
• Volume, quality and mix of retail provision • Additional services and facilities • Leisure provision • Accessibility • Parking • Shopping Environment

2.

Merchandising
Merchandising is the methods, practices, and operations used to promote and sustain certain categories of commercial activity In the supply chain, merchandising is the practice of making products in retail outlets available to consumers, primarily by stocking shelves and displays. While this used to be done exclusively by the stores' employees, many retailers have found substantial savings in requiring it to be done by the manufacturer, vendor, or wholesaler that provides the products to the retail store.

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While stocking shelves and building displays is often done when the product is delivered, it is increasingly a separate activity from delivering the product. In grocery stores, for example, almost all products delivered directly to the store from a manufacturer or wholesaler will be stocked by the manufacturer's/wholesaler's employee who is a full time merchandiser. Product categories where this is common are Beverage (all types, alcoholic and non-alcoholic), packaged baked goods (bread and pastries), magazines and books, and health and beauty products. For major food manufacturers in the beverage and baked goods industries, their merchandisers are often the single largest employee group within the company. ➢ Merchandise stores have a couple of objectives. They need to make a decision on the price that they re willing to sell the merchandise, and the quality of service that they need to give customers, that’s basically it. ➢ A department store can have the option of setting high prices for items and providing quality service, or they can become a discount store. A discount store sells items a frugal price but provide little to none customer service. Target is a discount store and that’s why they are so distinguished. They provide good customer service, and high quality brand name products. Target prices are extremely competitive because they sell well known material with a nice discount. ➢ A merchandising business makes their income by the purchasing and selling of goods. Every merchandising company whether it’s wholesale or resale uses a similar accounting formula. For a retail company the management is a difficult task because the buying and then selling of goods make it an uneasy task. ➢ Getting a decent margin will depends on the appropriate pricing of merchandise, and purchasing merchandise for a fair price. To keep the operating expenses going smoothly it depends on controlling expenses and operating everything properly. At important times throughout the year the management should compare its estimated budget to its actual one. ➢ There are two basic systems used in accounting and they are perpetual and the periodic inventory system.: ○ When using the perpetual inventory system, numerous of records are kept for the quantity available and the cost of the individual items as they are sold. This detailed system gives the management team a better chance of the wants or needs of customers because they have an idea what is in stock. The cost of an individual item in this system is recorded in the Merchandise Inventory account, and when the item is sold it is transferred to the Cost of Goods sold account. ○ the periodic inventory system the item that is not sold is checked often, but usually towards the end of an accounting period. No records are kept for the inventory throughout the accounting period. The inventory is only accurate for the balance sheet date. The reason why some retail stores use this method is because it cuts down on the clerical work. ➢ The merchandise inventory is all of the goods that will be sold in the future. These include all goods whether in boxes on the shelf or currently on the self. The ending inventory is inventory that cannot be sold, or are not intended to be sold. These include merchandise that has been damaged, but it’s a good idea to sell the damaged goods at a significantly reduced price if they can to get rid of it.

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\

Chapter 2 Research Methodology
Research methodology is a way to systematically solve research problem. In it we study the various steps that are generally adopted by researcher in studying his research problem along with the logic behind them. It is necessary for a researcher to know not only the research methods/techniques but also the methodology. It may be noted, in the context of planning & development, that the significance of research lies in its quality and not in quantity. Researchers should know how to apply particular research techniques, but they also need to know which of these methods or techniques, are relevant and which are not, and what would they mean and indicate and why.
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Objectives of the Study: Primary Objective:
• • • • • To clearly understand the concept of Catchment area analysis and merchandising in retail. Study about the Customer Approach Towards the Spencer’s Hyper Study about the Target customer Study the Importance of Merchandising in FMCG –Food Sales Study the customer Buying Behavior in FMCG-Food section

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Secondary Objective:
• • • • • •

Understand the customer expectation from Spencer’s Hyper Customer Expectation from Spencer’s Hyper Gather all information about the Merchandizing To Make suggestions toward the improvements in Merchandizing of FMCG –Food Products To understand the importance of merchandising in Retail Store All detail about the Products in FMCG-food Section

There are various stages to solve the research problem as shown in following diagram:

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

DATA COLLECTION: PRIMARY SOURCE: The method of data collection is done by the way of survey; this is a process whereby first hand information is collected. This method is needed for meeting the specific objective of research study. I have collected primary data in the form of filled structured questionnaire by customers, employees of the Spencer’s and other mom and pop stores owners. In first questionnaire I collect whole data about catchment area of the Spencer’s hyper Lucknow. In second I collect all the data regarding the consumer preference for FMCG (Food) products by customers, employees of Spencer’s and other Mom and Pop stores owners as they also deals with large numbers of customers in their day to life and can clear the picture about the customer preferences.

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SECONDARY SOURCE: The secondary data was collected in the form of company profile and product profile from the Web Site of Spencer’s and different websites of respective company products. Some other Web Sites were also referred. For collecting the required data the CSA’S of the Spencer’s were also consulted. The data is collected from various sites, books, journals, etc.

Sample Design: After deciding on the research approach and instruments one has to decide the Sample Plan:
1) Sampling size: The sample size is :

i. 200 people for catchment Area Analysis ii. 200 people for Merchandising of FMCG-Food Analysis
2) Sample Selection Procedure: I have collected samples in a simple random manner therefore

the sampling technique used for the research is Random Sampling Technique 3) Sample Unit: i) The customer of Spencer’s are treated as Sample unit for the customer questionnaire ii) The CSA is treated as sample unit for employee questionnaire iii) The owner of Mom & Pop Store has been treated as sample unit for the Mom and Pop store Questionnaire.
4) Contact Method: Personal Approach to each and every customer, CSA or owners of stores

for all the surveys and interview were the contact method use for obtaining a proper and detailed feedback. A face to face interaction took place with each sample representative. The data collected through questionnaire was properly classified and tabulated in the form of a report. These reports form the basis for the analysis and drawing inferences from them. From the Inferences drawn certain conclusions and recommendations were made.
5) Field Work: The field work was conducted for the duration of 4 months.

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Chapter 3 Analysis and Interpretation

1.1Analysis Of Catchment Area Analysis
Store preference of the customers
Company Nos. of Customer 90 Big Bazzar V-mart Spencer's Vishal 10 40 10

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products Others 50

Analysis: Most people Prefer Big Bazzar as their Shopping destination

1.2Frequency of Shopping in a month

Frequency of Shopping Once Twice Thrice More than Thrice

Nos. of Customers 80 56 44 20

Analysis: Most people Shop once in a month and a very few bunch of peole shop more than three times.

1.3Shopping Partner

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products Shopping Customer Family Alone Spouse Seravnt Nos. of Respondent 52 28 79 39

Analysis: Most people either do their shopping with their spouse or family

1.4Most Important Thing while Shopping
Most Important thing while Shopping Value For Money Quality of Product Price of Product Convenience Ambience Range & Assortment Nos. of Customer 24 36 28 30 8 42

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Analysis: Most people give preference to range and Assortment than quality of product and then price of product while their shopping, convenience and ambience does not play much role in value store.

1.5Monthly Expenditure in the categories

Category Wise Spend Approx
Category Food Personal Care Home Care Electronic & Electrical Fruits & Vegetable Total Amount Expenditure 1470 588 630 168 1344 4200

1.6Extra Facilities you want from a Hyper Market
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Extra Facilities Food Court Pharmacy Sweat Shop Bakery Crèche for Kids Others

Nos. of Customers 40 50 26 48 28 8

Note: Others includes: Meat counters, Take away counters, & Coffee shop

Analysis: Customers want some extra facilities from the store such as food court, pharmacy, bakery and crèche for kids.

1.7Distance you can Travel for the Store
Distance customer can travel for a store Less than 1 km 1-2 km 2-3 km More than 3 km Nos. of Customer 62 52 10 26

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Analysis: Mostly people wants store to be located near to them so that they can shop easily.

1.8Credit /Debit Card Holders

Nos. of Debit/Credit Card None One Two Three More Than Three

Nos. of Customers 22 36 74 40 28

Analysis: Mostly people have Debit / credit Card and a large segment carry two cards.

1.9House Hold Income per Month

Household Income Spencer’s Hyper--Lucknow

Nos. of Customers Page 69

Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products Less than 12 k 12k-20k 20k-50k above 50k 4 40 94 62

Analysis: The people who are shopping in malls basically belongs to segment of house hold income 20k to 50 k and above 50 k

2.Analysis of Merchandising of FMCG-Food Products Note: This survey is conducted separately in which 30% customer were those which came to Spencer’s for shopping and remaining were interviewed randomly from different location in Lucknow 2.1Purchasing of FMCG – Food Products from Spencer’s Products
Sales Yes No Nos. of customers 80 140

Analysis: still a large number of people do not purchase their food items from Spencer’s.

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If yes please indicate 2.2How strongly you agree or disagree with the following statement 2.2(i) Availability of all products in Spencer

Availability of product in Spencer’s Strongly Agree Agree Some What Agree Disagree Strongly Disagree

Nos. of Customer 3 8 24 28 17

Analysis: Most of the customer who shop at Spencer believe that many products are not available in the store

2.2(ii)Availability of product in store in sufficient stores

Availability of Product in store in sufficient Nos. of Customer Store Strongly Agree Agree Somewhat Agree Disagree Strongly Disagree

6 10 22 27 15

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Analysis: Most people who shop at Spencer’s they believe that product is not available in sufficient quantity in store

2.2(iii).The Offers available in the store are better than any other store

Spencer’s have Better offer Strongly Agree Agree Somewhat Agree Disagree Strongly Disagree

Nos. of Customers 9 11 20 33 7

Analysis: Most people don’t agree that Spencer’s have better offers than any other store

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1.3If No

2.3(i) From where do you purchase FMCG-Food items

Fmcg - Store Choice BigBazar Vishal V-mart Others

No. of Customer 60 15 5 40

Analysis: The people who are not purchasing food items from Spencer they prefer to shop at Big bazzar.

2.3(ii) Shopping Reason in the Store

Reasons to Shop Affordable Price Convenience Availability of Parking Space Range & Assortment Ambience

Nos. of Customers 50 9 8 35 18

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Analysis: The basic reason of shopping in other places is that they get better offers (affordable price) and better range & Assortment.

2.3(iii) Areas of Improvement in the your preferred Store

Areas of improvement Stock Out Service Hygenic Sign & Signages Ac not Functioning Properly

Nos. of Customers 37 40 10 9 14

Analysis: Most people who shop in different store believe that their store should improve on the part of service and stock out.

2.4 Favorites Products in the Category: According to survey I am giving five best products from each category
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products a.

Biscuits /Cookies 1. 2. 3. 4. 5. Britannia good day Britannia Nutri choice Parle G Parle hide & Seek Britannia Marie Gold

b. Arriated Drinks 1. 2. 3. 4. 5. Thumsup Pepsi Coke Sprit Dew

c.

Juices 1. 2. 3. 4. Real Active Orange Real guava Real Leachy Real Mixed Fruit Juice 5. Real Pineapple

d. Chocolates 1. 2. 3. 4. 5. Cadbury Dairy Milk Nestle Kit Kat Cadbury fruit & nut Cadbury five star Cadbury Crackel

e. Cornflakes 1. 2. 3. 4. 5. Kellogg’s Mohans Chocos K-Challenge Muslei

f. Sauces 1. Kissan tomato ketchup 2. Maggi Hot N Sweat 3. Kissan Chatakdar 4. Maggi rich Tomato 5. Kissan Chili tomato

Spencer’s Hyper--Lucknow

1. g. TeaTaj Mahal 2. Lipton Green Label 3. Tata Tea gold 4. Read Label 5. Taaza

h. Coffee 1. Neccafe 2. Bru 3. Nescafe Sunrise
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i.

Noodles Maggi Masala Noodles Maggi Atta Noodles Top Raman Chings Roated Garlic Maggi Chiken

j.Ready to Eat 1. MTR Pav Bhaji 2. MTR Mix veg curry 3. MTR Palak Paneer 4. MTR Dal Fry 5. MTR Chana Masala l. Butter 1. Amul Pasteurized Butter 2. Amul Lite 3. Peanut Butter (cong Agra Foods) 4. Parag Butter 5. Mother dairy Butter

1. 2. 3. 4. 5.

k. Papad 1. 2. 3. Papad 4. 5. Lijjat Papad Punjabi Masala Lijjat papad kalimirich Haldiram Punjabi Masala Lijjat Udad with red chillies Lijjat Moong Special

1. Lays American style Cream and m. Chips Onion 2. Lays Indian Magic Masala 3. Bingo mad angles chili dhamaka 4. Kurkure Spencer’s Hyper--Lucknow 5. Lays Plain Salted

1. Haldiram Bhujia n. Namkeen Aloo Bhujia 2. Haldiram 3. Haldiram Navratan 4. Haldiram Panchratan 5. Haldiram Moong dal

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

o. Instant Mix 1. 2. 3. 4. 5. Dosa Mix Idli Mix Gulab jamun Mix Dhai Vada Mix Dhokla Mix

p. Jams 1. 2. 3. 4. 5. Kissan Mixed Fruit jam Kissan Pineapple Kissan Orange Jam Tops Mixed fruit Kissan Strawberry

q. Milk Supplement 1. 2. 3. 4. 5. Complan chocolate Bournvita Boost Bournvita little Champ Milo

r. Ready to cook 1. 2. 3. 4. 5. Knoor Chineese chilli Knoor Punjabi Chicken curry Knoor Chineese Haka Noodles Knoor Punjabi chana masala Knoor Chinese Schezuan

1. Knoor Hot n Sour Veg 1. Tang Orange s. Soup t. Syrup/ crush International 2. Knoor Hot n Sour chicken 2. Rasna / Squash/Powder 3. Knoor spicy Tomato 3. Kissan Orange 4. Knoor Home Style creamy chicken’ 4. Kissan Pineapple 5. Knoor sweat corn Veg 5. Mishrambu
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Use of products by the customer
Usage

Bhuna Masala
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60

Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Corn flour Curry paste Custard powder Desert topping Dips Frozen Food Fryms Glucose Honey Icing Sugar Popcorn Pizza Cheeze Soya Suace Keora Water Lime Juice Macroni Pasta Powder Milk Soya Milk Sugar Free Toast Tomato Puree Vermicelli Vinegar Fresh Cream Tetra Pack Milk Cheeze

80 60 118 38 37 110 90 156 78 18 81 42 156 28 122 64 78 56 38 86 126 66 96 172 44 134 138

Analysis: All the items who are above 100 are kept in A category that is they are highly used by customers , the products that are between 100 and 50 are kept in B Category and others are kept in C category according to the customer usage.

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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Category A
• • • • • • • • • • Custard Powder Frozen Foods Glucose Lime Juice Sugar free Vinegar Tetra pack milk Cheese Toast + Products discussed in Question number 4.

Category B
• • • • • • • • • • • • Bhuna Masala Cornflour Cuury paste Fryums Honey Popcorn Mcronni Pasta Powder milk Sugar free Vermicelli Tomato puree

Category C
All the rest products comes under this category.

Chapter 4 Limitation
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Though the study is framed in a manner that it provides answer to the basic questions which are needed to study but sometimes it becomes a bit tougher to get the right answer from the respondents. Constraints which are there to limit the study are: ➢ Time of the respondents ➢ Proper coordination from the part of respondent ➢ Understanding of the topic of the respondent ➢ Biased answer from the respondent ➢ Study is limited to the Lucknow region only

Chapter 5 Findings & Conclusion
Today is the area of competition. The business is totally dominated by the competitors. Only those could face the challenges and who can offer better service to customers in all respects.. Basically Indian consumers and specially the consumers in the city like Lucknow are price
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Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

conscious but it’s not only the price which the customers are looking for they are ready to compromise on the price part but in return they want good range & assortment better service , good customer service and better ambience, if one cloud offer these things to the customer they are ready to sacrifice a bit on the price part because in the purchasing of FMCG –food products you could hardly save on the price part but off course if there is a store which is offering great range and assortment , good service , excellent customer service and competitive offers than definitely one will not only survive in the market but will be the market leader. ➢ While merchandising one should focus on the category A and category B products ➢ The top 5 products of certain important category has been listed one should keep the excess stock of these products as they are hot selling products. ➢ One should try to get as much offers as one could get from the companies and most important it should be our prime concern so as to get offers on hot selling products as this will make the customer happy as well as loyal. ➢ If it is not possible to get offers from the companies than one should give offers to customer on certain products from our side.


Since most customers do their shopping once in a month and our monthly offer cycle comes on 24 th of every month therefore the stocks should be n the store till 30th of every month as first two week of every month are the days when the customer will come for their monthly shopping and therefore excess stock of certain hot selling items should be there in warehouse.

➢ Facility like home delivery ,phone shopping, email shopping are some of the ideas which could increase are customer base . ➢ Spencer’s could also introduce unique system of pre – order from the customer where it can ask to the customers to place their order after 24 th of every month and deposit a small token amount and their monthly purchase will be delivered to their home on desired date and time and the balance payment will be taken at the time of delivery . this will not only increase the customer loyalty but it will also help us to understand the demand and placing the orders according to the demands of the customer.

Bibliography

www.spencersreatil.com www.wikepedia.com www.Google.com
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www.indiaretailing.com

Annexure
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Questionnaire for Catchment Area Analysis
Name:……………………………………………………………………………………………...

Address:…………………………………………………………………………………………..

Nos. of Adult in Family:……………………………………………………………….............

Nos. of Children in Family:…………………………………………………………………....

1.) Where do you prefer to Shop? Big Bazzar V-mart Spencer’s Vishal Mega Mart Others

2.) How frequently do you shop in a month? Once Twice Thrice More than Thrice

3.)With whom you shop Family Alone Spouse Servant

4.) What is the most important thing while shopping? Value for money Ambience Quality of Products Range & Assortment Price of Product Convenience

5.) What amount you monthly spend on the following Category? Food …………………. Personal care …………….. Home Care …………………………. Electronics & Electrical……………………………..Fruits & Vegetable……………………… 6.) What Extra Facilities you want in a Hyper Market? Food Court Pharmacy Sweat Shop Bakery Crèche for kids

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Others, Please Specify…………………………… 7.) How far you can travel for a Store? Less than 1 Km 1-2 km 2-3 km More than 3 km

8.) Do you have Debit/Credit Card? None One Two Three More than Three

9.) What is your Household Income per Month? Less than 12 K 12K-20k 20K-50K Above 50K

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Questionnaire for Merchandising of FMCG--Food Products

Name:................................................................................................................ ...........................

1) Do you purchase FMCG-Food items from Spencer’s? Yes If yes:
2) Please indicate how strongly you agree or disagree with the following

No

statements i) Availability of all type of product in store 5 4 3 2 1

ii) Availability of product in store in sufficient stores 5 4 3 2 1

iii) The Offers available in the store are better than any other store

5 If No:

4

3

2

1

1) Please Indicate the Right Choice i. From where do you purchase FMCG-Food items Big Bazzar Specify................... ii. Why do you shop in this store?
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Vishal

V-mart

Others Please

Research Report on Catchment Area Analysis & Merchandising of FMCG-Food Products

Affordable Price Space Range & Assortment

Convenience Ambience

Availability of Parking

iii. What are the Area in which your Shopping Destination can Improve Stock out Service Hygienic Sign & Signage’s

AC Not Functioning Properly 1) Please mention your favorite product in the category Given: ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ Biscuits/Cookies Arriated Drink Juices Chocolates Cornflakes Sauces Tea Coffee Noodles Ready to Eat Papad Butter Chips Namkeen Instant Mix Jams Milk Supplement Ready to Cook ○ Bhuna Masala Soup Corn flour ○ Syrup/Crush/Squash ○ Curry paste

○ Custard powder 2) Please Tick the Items that you use: ○ Desert topping ○ Dips ○ Frozen Food ○ Fryms ○ Glucose ○ Honey Spencer’s Hyper--Lucknow ○ Icing Sugar ○ Popcorn ○ Pizza Cheeze

○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○ ○

Keora Water Lime Juice Macroni Pasta Powder Milk Soya Milk Sugar Free Toast Tomato Puree Vermicelli Vinegar Fresh Cream Tetra Pack Milk

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