Trang 76.

Amidst japans multilayed distribution system stands one convenience store chain that does twice as much business per square foots as the average janese retail store. Seven-eleven japan (the seven is spelt out by the japanese company) is the largest and most profitable convenience store chain in japan, with around 6.700 outlets, all operated on a franchise basis under lto-yakado. Known as conbini or convenience stores, seven-eleven janpan has become a center of community life, functioning as town halls, culture clubs, and venues for romance. People go there not just to buy food essentials, but also to pay phone bills or send a fax, hang out with friends, spend hours reading magazines, or check out the latests fashion on nail stickers. It has become such an indispensable part of life that rental ads promote an apartments proximity to a convenience store. Seven-eleven japan exercies ferocious inventory control and a form of just in time delivery with the lowest distribution costs. The firms secret, apart from good management and rigid costs control, has been to go along with, rather than to oppose, the bizarre reality of japanese retailing and distribution. With roads in japan getting more congested, seven-eleven japan encourages its suppliers to deliver in bulk to its manufactures and wholesalers incentives for detailed market information about who buys what. Despite being well stocked from magazines, milk, and canned goods, to sliced octopus and bolied tofuaccompanied by clerks taking orders for Tiffnay and Rolex watches-each seven-eleven store carried a third of the inventory of its American counterparts. Its point-of-sale (POS) computer system helps seveneleven japan know what consumers wantm what to stock, and how much to charge, freeing the companys immense cash flow for improvements and expansion. The POS system has also helped seven-eleven detect not only trends over time but also differences between regions and the effects of weather on consumption. It constantly updates senior excutives of the changing demographic profile of different products like fresh lunch boxes, can be obtained by time, age, and sex of customers. With such information, seven-eleven japan now offers photo developing and fax-sending services. The shops serve as pick-up points for overnight delivery services and for compaines that rent anything from skis to video cameras by the day. Such information has also been used to shorten the cycle of hit products. Some 70 percent of its 5000 items that appear on the list of products recommended by HQ are replaced by new ones within a year. Hit products that used to say on the shelves for six months now remain for three months. This ability to catch up with changing demands has allowed seven-eleven to sell its own brand ice cream developed jointly by three different ice cream makers. Seven-eleven also ensures product freshness. Its prepares food in its own factories and ships to the stores as often as three times a day through a centrailized distribution system. Each food items is marked with a best before date, not to be confused with expiration date. To ensure high quality, it throws aways food that exceeds its best before dateeven if the food is not spolied. Products sell so well that they account for some 40 percent of its annual turnover. All display racks in a seven-eleven store are well-lit so that even products placed in the corner or at the back can be easily seen by shoppers. The floors are always clean and polished so that they reflect the florescent lights on the ceiling.

Seven-eleven employs filed consultans (FCs) each responsible for seven to eight stores. The FC visits each stores twice a week, and stays there for three to four to give operational advice such as how to prevent fast-selling products from selling out having goods left unsold. Seven-eleven realized that convenience stores may tie japanese consumers to the ecommerce revolution. Japanese consumers are hesitant to use credit cards and surfing the internet has still to catch on. Most shoppers are not home during the day to recevie parcels. Further, japanese consumers want to buy products face-to-face. In july 2002, seven-eleven thus lauched an online virtual mall that sells everything from CDs to flowers to tour packages. 7 dream.com is a full service e-ecommerce venture with such partners as NEC, sony, Mitsui, and japan travel bureau. The purchase is then delivered to the nearest seven-eleven where the custimer picks it up and pays for it. It is also installing ATMs and mulimedia termials in its stores that will not only give shopping, but also print out tickets dowload music, and accept cash payments. In 1991, ito-yokado bought more than 70 percent of its u.s franchiser when the latter was mired in a debt crisis and asked ito-yokado to bail it out. More recently, together with Taiwans a huge market that is estimated to accommodate more than 20.000 convenience stores. It plans to open 500 stores by 2007, starting in Beijing. It will make use of the distribution networks set up by ito-yokado which already has two stores Beijing.

Trang 69.70 Since opening its first outlet in downtown Beijing in 1987, KFC has become the largest fast-food chain in china. Several factors account for its success, including adding popular local dishes Chines vegetable soup, chicken riec, and porridge breakfast to its menu. KFC has been particulary successful at wooing children in China by offering special kids meals, building playgrounds imside its restaurants, and employing clever promotions such as Chicky, a friendly chicken character adapted from its operations. PLACE DECISION Retailers are accustomed to saying that the three keys to success are location, location, and location. Cinsumer generally choose the nearest bank and gas station. In China, most visits to popular outslet-wet markets, convenience stores, and supermarkets-are made within 10 minutes walking distance of home. Department-store chains,oil compaines, and fast-food franchiers exercise great care in selecting locations. The problem breaks down into selecting regions of the country in which to open outlets, then particular cities, and then particular sites. A supermarket chain might decide to operate in Suotheast Asia, in countries such as Malaysia and Singapore, and within Malaysia, in two cities such as Kuala Lumpur and Ipoh, and within Kuala Lumpur, in two location,one in the prime shopping district and another, suburban. See Marketing Insight: Assessing Asian Economies for Retail Market Entry. Retailers can locate their stores in the central business district, regional shopping center, a community shopping center, a shopping strip, or within a larger store. Center business districs: this is the oldest and most heavily trafficked city area, often known as dowtown. Store and office rents are normally high. But a number of dowtowns, such as Tokyos Shinjuku, Singapores Orchard Road, and Kuala Lumpurs Bukit Bintang have been hit by a flight to the suburbs. As Asia becomes more saturated with shopping governments Retail Promotion Center which

was established to help small-and medium-sized retailers improve their marketing and service skills. Among other things, the courses train them to enhance their store atmosphere by providing tips on visual merchandising and managing shop-front displays. PRICE DECISION Prices are a key positioning factor and must be decided in relation to the target market, the product-and-service assortment mix, and competition. All retailers would like to achieve high volumes and high gross margins. They would like Turns earns, but the two usually do not go together. Most retailers fall into the high-markup, lower-volume group (fine specialty stores) or the low-markup, higher-volume group ( mass-merchandiers and discount stores). Within each of these groups there may be further gradations. Retailers must also pay attention to pricing tactics. Most retailers will put low prices on some items to serve as traffic builders. They will run storewide sales. They will plan markowns on slower-moving merchandise. For example, shoe retailers may expect to sell 50 percent of their shoes at the normal markup, 25 percent at cost. However, constant price changes may confuse consumers and invite competitive retaliation, thus blunting their effectiveness over time. McDonalds In 2000, when McDonalds Japan began a half-price campaign which saw its basic burger priced at 54 cents, long lines formed outside its outlets at luch time. Buying a meal comprising two hamburgers for just $1.08 was a great bargain for budget-conscious consumers in the misdst of a recession. In Septemper 2001, mad cow disease turned many Japanese consumers off beef products and McDonalds woes began, even thuogh the company imported most of its beef. McDonalds raised the price of its basic burger to 66 cents in February 2002, citing that low prices alone will not move costomers. As sales fell nearly 20 percent, McDonalds reversed course and cut its price again in August 2002, with the bisic burger retailing for 49 cents. However, its price cut may not be as effective as before. Others in the food business have since lowered their prices. Lunch boxes and even sit-down set meals costing $4 are common. The Daiei group operetes a cut-price shop in Ginza where everything from rice balls to salads to bottled oolong tea sells for just 73 cents each. Hence, some retailers have abandoned sales pricing for everyday low pricing. EDLP can lead to lower advertising costs, greater pricing stability, a stronger image of fairness and reliability, and higher reatail profits. Wal-mart practices everyday low price. One study found that supermarket chains practicing EDLP were often more profitable than those practicing sales pricing. Finally, retailers may also carry their own brands which are cheaper than manufactures brands. Supermarkets like Taiwans Uni-President and convenience stores like Hong Kongs Watsons have their house brands that are prices 10 to 25 percent cheaper than other brands. PROMOTION DECISION Retailers use s wide range of promotion tools to generate traffic and purchases. They place ads, run special sales, issue money-saving coupons, and run frequen shopperreward programs, in store food sampling, and coupons on shelves or at checkout points. In Shanghai, live models are used by some retailers in window displays to attract attention (see Figure 18.7). Each reatailer must use promotion tools that support and reinforce its image positionging. Fine stores will place tasteful full-page ads in magazines such as Vogue and Elle. They will carefully train salespeople to greet customers, interpret their needs, and handle complains. Off-price retailers will arrange their merchandise to promote the idea of bargains and savings, while conserving on service and sales assistance.

Trang 71 Malls, several retail outlets are braching out to suburban locations for lower rent and less competition. Regional shopping centers: These are large suburban malls with fewer stores. They usually draw customers from a 10 to 25 kilometer radius. Typically, malls feature one or two anchor stores, such as Isetan or Sogo, and many smaller stores, many under franchise operation. Malls are attractive because of generous parking, one-stop shopping, restaurants, and recreational facilities. Succesful malls charge high rents and may get a share of stores sales. Community shopping centers: these are smaller malls with one anchor store and between 20 and 40 smaller stores. Strip malls (also called shopping strips): These contain a cluster of stores, usually housed in one long building, serving a neighborhoods needs for groceries, hardware, laudry, shoe repair, and dry cleaning. They usually serve people wihin the neighborhood. A location within a larger store: Centian well-know retailers- McDonalds and Starbucks-locate smaller units as concession space within large stores or operations, such as airports, schools, or department stores. In view of the relationship between high traffic and high rents, retailers must decide on the most advantageous for their outlets. They can use a variety of methods to assess locations, including traffic counts, surveys of consumer shopping habits, and analysis of competitive locations. Several models for site location have also been formulated. Retailers can assess a particular stores sales effectiveness by looking at four insicators: number pf people passing by on an average day, percentage who enter the store, percentage of those entering who buy, and average amount spents per sale.

Assesing Asian Economies for retail Market Entry MARKETING INSIGHT

Which Asian coutries are the most promising for new retail entrants to the region? A 2002 study by Pricewaterhouse coopers rates Asia countries into three categories go cautious, and wait according to their retail sectors accessibility to new entrants. To this end, such criteria as the countrys organized retail industry situation, regulatory constrains, risk, retail and consumer opportunities, outlook, and trends, were employed. China came out tops as the most attractive market in the region. Continued consumer spending, underpinned by expected GDP growth of over 7 percent in 2003, was expected to provide substantial opportunities for retailers. Even though foreign retailers were well represented in china, the countrys potential is sufficiently large to accommodate newcomers. Other Go markets included South korea, with its robust domestic economy, and the largely unexplored market of VietNam. In contrast, nature economines with satuated retail markets such as Singapore and Hong Kong were rated as Wait. Singapore may not be the friendliest place for new entrants despite its affluent population. Apart from intense competition among retailers, its consumers were also more demanding and had a high

degree of brand loyalty. Hong Kong retailers are suffering from shrinking margins due to cross-border competition. Niche retail investments in both countries were preferred. In the Cautious category were such coutries as Japan and the Philippines, given their complex economic and finacial position, and Indonesia, given its high political risk. India, Taiwan, Thailand, and Malaysia were similarly categorized. Indias regulatory constraints were still strong although changing, and had political risk. Taiwans economy was recovering, but it had political risk and an aging population. Thailand and Malaysia were still growing, but foreign players had established dominant positions in these markets/ PWC noted that the biggest mistake a retailer entering asian can make is to consider the region as being homogeneous. Asian consumers differed significantly from country to country with their strong cultural, social, and religious backgrounds. Regional consumers also had strong sense of belonging to a group. They also took more time to develop brand loyalty and were particular about service level. PWC urged potential new entrants not to neglect service quality in the region, which was higher than that of the West. In particular, retailers should ensure that the goods were in their stores availale sale. Trang 72 Part five: Managing and delivering marketing Programs. Aside from these quantitative considerations, many retailers in Asia also employ fengshui (literally, wind and water) in locating their retail outlets as well as in conducting other marketing activities. This refers to the use of geomancy and is discussed in more derail in Marketing Insight: Feng Shui and its Application to Retailing and Marketing in the Far East. Trends in Retailling. We now summarize the main developments retailers and manufacetures must consider in planning competivite strategies. 1. New retail forms and combinations. Some supermarkets include brank branches. Bookstore fearure coffee shops. Gas stations include food stores. Singapores National Library has branches located in shopping malls, complete with cafs. 2. Growth of intertype competition. Different types of stores-discount stores, catalog showrooms, department stores-all compete for the same consumers by carrying the same type of merchandise. Chain stores such an HMV and IKEA compete alongside independently owned stores. 3. Growth of giant retailers. Through their superior information systems, logistical systems, and buying power, giant retailers can delever good service and immense volumes of product at appealing prices to consumers. They are crowding out smaller manufactures what to make, how to price and promote, when and how to ship, and even how to improve production and management. Manufactures need these accouts; or they would lose 10 to 30 percent of the market. Some giant retailers are category killers that concentrate on product category, such as toys ( Toys R Us). Other are supercenters that combine grocery items with a huge selection of nonfood merchandise (Wal-Mart). ( See Marketing Insight: Category Killers Versus the Internet.).

4. Growing investment in technology. Retailers are using computer to produce better forecast, control inventory costs, order electronically from suppliers, send e-mail between stores, and even sell to customers within stores. They are adoping checkout scanning systems, electronic funds transfer, electronic data interchange,in-store televion, store traffic radar systems, and improved merchandise-handing systems. Park N shop Park N shop revolutionnied its information-delivery strtegy with a system that collects daily retail sales data from every cash register in every store and delivers analyzed sales figures to its head office in time for the next working day. Before the system was launched, gathering and analyzing sales information was difficult and time-consuming. Store managers ordered their supplies from the head office according to daily sales figures. Head office managers and buyers made purchases based on the orders shipped from warehouse to supermarket, comparing them against previous years data local information such as dates of public holidays and festivals. Now, between1 a.m and 3 a.m.., the head office polls each shop in turn. Actual daily sales information and changes in stock are uploaded, and price change information dowloaded. By 8 a.m,, thec central database has been updated and up-to-the-minute reports are ready for the buyers when they come to work at 9 a.m. buyers can even drill down through product categories for more details. The technology has enabled Park N Shop improve the quality and timeliness of information to make better buying decisions on its 10000 products for the 320000 customers who pass through its 170 stores daily. Global presence of maijor retailers. Retailers with unique formats and strong brand positioning are increasingly appearing in other countries. US retailers such as McDonalds, Wal-Mart, and Toys R Us have become globally prominent. European global retailers include Britains marks and Spencer, Italys Bentton, Frances Carrefour hypermarkets, and Swedens IKEA home furnishings stores. Among Asian retailers, the Japanese have the longest and largest international presence. Japanese retailers have been used as a channel to market Japanese consumer goods to foreign buyers, serve Japanese tourists and expatriates abroad, and enable. Trang 73. Marketing insigh. Feng shui and its Application to Retailing and Marketing in the Far East. Marketers in Asia have come to recognize that the supernatutal attracs many Asians. Many folklores, tabooks and superstitious and religious connotations by colors, numbers, and symbols exist in Asia today. Marketers should thus capitalize on Asians beliefs in the supernatural strategically. Feng shui is a particularly good example. Widely applied in Chinese culture but also in Japan and VietNam, it means wind and water. It refers to the ancient art of geomancy-a calculated assessment of the most favorable conditions for any venture. It is believed that Mans destiny could be enhanced if there is a correct alignment of the environments chi (invisible energy) with the human chi. Thus feng shui involves the art of placing things, ranging from the orientation of buildings to the furnishing of the interiors, to influence the chi of a site. Excellent living conditions contribute to goos health,which in turn leads to success and prosperity. In Kuala Lumpur, for instance, the headquarters of Malaysian Airline System, Promet, and MUI were placed so that there was harmony and neutrality

among the surrouding buildings. Objects used in the practice of feng shui include bright colors and/or light refrecting surfaces such as mirrors, crytals, chimes and bells; living objects such as foutains; and heavy objects like rocks and sculptures. Some general guidelines of feng shui include where the front door of a business should face for a favorable orientation. A law firm, a medical center, a trading company, or shipping firm should face north or east while a north or southeast is appropriate for saloons and retail stores. According to feng shui, ann ideal retail shop is a corner plot with a cater-cornered entrance to draw in maximum chi and business. The entrance area should also be clear of obstacles or trees to give the life forces a clear path to the house.. If the entrance is too small, feng shui would suggest mirrored or refective panels be added on either side of the opening. Crystal chandeliers are said to activate the chi and distribute it around the shop. Plants can be used to block off sharp corner projections. They help to allow the chi the chi to rise and circulate, giving a growing, lively feeling to the spece. In addition, to have good feng shui, the building must face the water and be flanked by the mountains. It should also not block the view of the mountain spirits. Thus several major Hong Kong offices, such as the headquarters of HSBC, have see-through lobies to keep the spirits happy. In contrast, sharp angles give off bad feng shui. This explains why the bank of China in Hong Kong is perceived as having bad luck by many people. Similary, The Gateway in Singapore has two triangular towers; its sharp edges and jutting points are traditinally considered inauspicious. However, to compensate, The Gateway has a northeast-southwest facing which is ideal in Shigapore. The buildings sharp edges thus slice through oncoming winds to reduce their power. As feng shui also incorporates numberology, addresses and opening dates must be carefully chosen. The numbers 2,5,6,8,9 and 10 are deemed lucky, but not 4 which conntes death; while the leter A is favored over C ( which sounds like death), F ( for failture), and X ( because it denotes something is wrong). To compensate for is bad geomancy, the bank of China opened its doors in Hong Kong on the eighth of August, 1988 (8/8/88), as the number 8 connotes becoming rich. Feng shui is big business in Asia. A company which consults an expert geomancer, and publicizes it, signals to its customers and employees that it cares for their prosperity and well-being. Hong Kongs chek Lap Kok Airport, for instance, engaged geomancy expert for advice to ward off evil anf incorporated feng shui considerations in its design. Western firms in the region have also come to use feng shui. J.Walter Thompson, for example, has retained a feng shui expert in Hong Kong who visits its offices periodically and is consulted before major presentations. The practice has also spread around the world. City planners in Vancouver reportedly consulted a geomancy expert as have executives at Motorola Semiconductor in Phoenix. The Japanese to study customer behavior firt hand. For example, department-store chains like Yaohan, Daimaru, Takashimaya, Isetan, and Sogo have long been a feature of the regional retail scene. However, the Asian crisis in the late 1990s led to downsizing and even closure of the regional operations of such chains as Yaohan, Daimaru, and Matsuzakaya. The crisis also proveded an opportunity for Western retailers to acquire some operations of their overstretched Asian counterparts to expand into Asia. For example, Tesco bought the Lotus superstone chain from Thailands CP Group.

Global retailers confront five challenges in expanding their operations to Asia. Firt, they must offer locally attractive products, packaged in a culturally sensitive manner. This may entail possible repositioning for some retailers. When it opened a department store in Guangzhou in 1996, Jusco anticipated that the spending power in the city would be half that of Hong Kong. However, Jusco found that it was 30 percent instead. After just one month of operations, Jusco had to refocus downmarket by featuring better value lines. Second, golbal retailers must source quality locations to site their stores. When KFC first entered Hong Kong, it opened too many outlets in obscure locations. KFC smalls stores also overlooked Hong Kongers expectation to sit down for meals, no matter how quick or cheap. Third, global retailers must develop physical logistics operations comparable to those in the home country to source and distribute products. Carrefours superior market logistics operation has been partly responsible for its being the only profitable hypermarket in China. Fourth, they must develop supplier relationships in Asia or be able to internationalize their home market suppliers. WalMart sources 85 percent of the products for its Indonesian outlets domestically, and purchased more than $10 billion from local suppliers in China for its 20 outlets there and overseas. Fifth, global retailers must account for diiferences in zoning, pricing, taxation, hours of operation, labor and hiring, and other regulations, some of which are designed to protecd domestic competiors. Carrefour had to reduce its stakes in several Chinese supermarkets to abide governmet regulations capping. Trang 74 Category Killers Verus the internet. One problem with the category killer model was that it was easy to copy, which meant that any specialty niche was subject to cutthroat competitors. For example, the office supply store market is currently occupied by three chains: Office Depot, Office Max, and Staples. Another problem was the seccess of superstore retailers like Wal-Marts dominance of retail in the 1990s also led many experts to question the category killers concept: why would consumers want to travel to a different store for each category purchase when they could buy all that they need a single location? Wal-Mart demonstrated the power of its superstore concept when it surpassed Toy R Us in 1998 to become the largest toy seller in the United States. Perhaps the biggest problem for category killers in recent years has been e-commerce. Internet sites with category killer business models, like online grocer Peapod.com. toy e-tailer e toys.com, and internet pet supply site Pets.com, attracted much investor attentio. By contrast retailers that moved to e-commerce were held to normal earnings critera that did not reward a money-losing online venture, and as a result many brick-and-mortal retailers stock prices were punished on Wal Street. With their high valuations, pure-click e-tailers were able to attract talented employees by offering lucrative stock options, and successed in building effcient delivery systems that fit the online business model. Traditional retailers had neither the cachet nor the soaring stock prices to attract the most creative talent, and often had to wrestle with delivery systems designed to bring products from warehouses to store shelves, not individual home. Although many interner pure-clicks did not survive the dot-com crash, they made the market much tougher for category killers. The company that poineered the category killer retail model, Toy R Us, struggled in the lade 1990s against online competions like eToys. In response, Toys R Us developed its own e-commerce site, called Toysrus.com, in 1998. The company invested more than $75 million in infrestructure to

manage delivery of products oedered on the site. The number of visitors to Toysrus.com increased more than 300 percent from 1998 to 1999. Unfortunately, the site was overthelmed by holiday season orders in 1999, and Toys R Us could not deliver many Christmas orders in time. In 2000, Toy R Us joined its e-commerce site with Amazon.com. The partnership illustrates one method for categary killer to compete with tinternet pure-plays. Another method for is integratin the physical retail locations with the e-commerce site, known as a clicks-and-mortar strategy. For example, Barnes & Noble bookstores installed internet terminals where customers can browse and purchase titles from the companys web site, bn.com. The clicks-and-martar approach has several advantages. For example, store-based retailers spent an average of less than $5 per person getting existing customers to shop online, while internet start-ups spent an average of $45 per person building a customer base from square one. Moroever, customers who purchased online and off-line ( the so-called double channel) from the same retailer increased their total purchases by 10 percent. Trang 75 Foreign ownership. It had bypassed the central government to seal deals with local governments to set up wholly-owned enterprises in exchange for providing jobs. Similarly, the Malaysian government, responding to concerns by neigborhood grocers, introduced licensing procedures where foreign operators must meet capital requirements, and were not allowed to locate their premises within a 3.5 kilometer radius of a huosing estate or town center. Upgreding of Asian retailers. Asian retailers are reacting strongly to the entry of foreign players. Asian department stores have established their own hypermarkets and discount outlets as a defensive strategy against foreign chains. Malaysias Metrojaya has Cosmart, Indonesias Matahari has Mega M, Thailands Central Retail Group has Cencar, Koreas Shisegae has E-Mart, Chinas Lianhua has Nonggongshang, and Taiwans Ta-Tung Group has Save and safe hypermarkets. Such home-grown stores offer clean, cheap, and convenient shopping similar to that offered by foreign rivals. With government subsidies and local connections, some in China can be set up for half or even a third of the cost borne by their foreign counterparts. Small-and medium-sized Asian retailers, have upgraded their marketing knowleged and skills to better serve their customers, or have merged or extied the market. Investment in technology, product specialization, and developing strong supplier alliances are used to promote micromarketing, cut costs, and improve distribution efficient. In China, many mainland retailers are forming collective buying groups with business like Hualian Bai Huo in Tianjin and Shanghai to gain economies of scale and more efficient distribution. Once full liberalization occurs in Chinas retail merket in 2005, compettion is expected to intensify further, followed by a subtantial shakeuot. Already, Park N shop has closed most of its 37-store chain failed to reach profitability. McKinsey forecasts that only five major Chinses retailers will survive the next 15 years, along with a handful of foreign chains. Here is an interesting Singaporean example of providing for success and failure. NTUC FairPrice Small retailers in Singapores major public huosing estetes had been ad versely affected with the entry of large supermarket chains into their neighborhoods, including NTUC FairPrice, the supermarket arm of Shigapores labor union. Thus NTUC introduced a franchise scheme for neighborhood retailers to run its 24-hour Cheers convenience stores. Struggling storekeeper could also choose to convert their provision shops into Cheers outlets if they had

reasonable experience and a well-located store. A franchisee stood to receive government funding as well as NTUCs expertise in retail management. Up to $12,000 of the $88,000 to $118,000 needed as initial start-up to stock and refit his store, could be abtained from the governments franchiseassitance programs. Moreover, there is a buy-back option where franchisees who opt out after three years can sell the store back to FairPrice at an aggreed price. 7. selling an experience, not just goods. Retailers are now adding fun and coommunity to compete with other stores and online reatailers. There has been a marked rise in establishments that provide a place for people to congregate, such as coffeehouses, tea shops, juice bars, bookshops, and brew pubs. Sweet meat stores offer tastings. Kinokuniya bookstore organizes talks by authors, and have cafes offering coffee and light snacks. Crossraods, a mega mall in Mumbai, markets shopping as family entertainment. 8. competition between store-based and modern nonstore-based retailing. Consumers now receive sales offers through direct mail letters and catalogs, and oveer television, computer, and telephones. These modern nonstore-based retailers are taking business away from store-based retailers. Some store-based retailers initially saw online retailing as a definite threat. 9. Recerse Retail Innovation. Not surprisingly, many modern retailing concepts and practices have originated from the West. For example, Janpanese Seven-Eleven stores are more productive than those in the U.S. They are half the size and carry a third of the inventory of the typical U.S 7-Eleven but yield twice as much profit. See Marketing Insight: Learning from Seven Japan.