Shiny Provision Stores Current: Shiny Provision Store in Bangalore Owner: Madhavan Anandan Running the food and

grocery store for several years Traditional managing and market based skills Old Kirana type store Modern retail outlets threatening the store

Action taken: Asked one of customer who was a market research She decided to research and develop a strategy on how a small grocery store can survive in a sophisticated and professional environment

India: The countrys diversity leads to many marketing and retail challenges Differing consumer segments with different lifestyles, incomes etc. 72% population in villages but Urban India accounts for 64% of consumption Majority of the households (Eighty Million) earn below US$1584

India Retailing Scenario: History Vedas considered trading to be the pillar of society Indian traders among the first to acquire retailing skills

Retail Formats Fairs: annually conducted, thousands of people from surrounding areas, retailers sold goods such as clothes, ornaments, spices etc. Shandies: weekly markets organized on particular day, retailers and farmers sold their goods, high bargaining Village shopkeepers: individual merchants who sold items door to door, prevalent in villages Public Distribution shops: govt. run chain that ensured availability of food grains to the poor at affordable prices

Growth of Retailing: 1947: poverty, necessity based retailing 1950: 0.25 million retail outlets only 1960: not a single supermarket 1978: only 2.335 million retail outlets stocking FMCGs 1997: 5.55 shops per 1000 people 2005: 10.51 shops per 1000 people

Kirana Stores: 25 to 400 sq feet Wide range of products for daily requirements of masses Offerings with limited Stock Keeping Units (SKU) Kept branded as well as lower priced & inferior unbranded products Food & grocery primarily Food & grocery market in India valued at US$236 billion in 2008. Contributed to 60% of retail sales and comprised of mostly unorganized sector Unorganized sector created employment for nearly 39.5 Million people i.e. 9.2 percent of population 80% outlets run by individuals or their family members Existed in local neighbourhoods unlike the modern retailing outlets India had 15 Million kirana shops Retailer had informal interaction and could even influence the purchase decision. This had significant implications for consumers perception of modern retailing vs. Kirana shops

Modern Retailing Formats: Modern/organized: Retail outlet chain, professionally managed, transparency in accounting, organized supply chain, centralized quality control Expected to reach $30 billion by 2010 up from $14 billion.

Unorganized: Operated locally by any single owner, lacking technical and accounting standardization, includes kirana stores

Modern Retails Formats: Supermarkets: food and household products Department Stores: lifestyle driven Hypermarkets/Discount stores: large volume driven, discount based Specialized/Category Killers stores: extensive range under single category Factory Outlets: out of vogue, discounted prices

Kirana Shops vs. Modern Retails Outlets Objective to analyse modern retail outlets vs. Kirana outlets Analyze the strategy of kirana stores which can also be utilized by modern retails outlets