Retail Management

A. K. Kher

Strategic Retail & Planning Process

1.

2.

3. 4. 5. 6. 7.

Define the business mission Conduct a situation audit, market attractiveness analysis, competitor analysis, self analysis Identify strategic opportunities Evaluate strategic alternatives Establish specific objectives & allocate resources Develop a retail mix to implement strategy Evaluate performance & make adjustments

Retail Format

Merchandise Location Layout Interior design Exterior design Services

Visual merchandising Promotion Advertising Personal selling Pricing

Vendors - Relative Advantages & Disadvantages

Impact on Store
Loyalty Image Traffic Selling & Promo exp Restrictions Differential Advantage Margins

Mfr

Pvt. label

Licensed

Generic

? + + + ?

+ + + + + ?

? + + + + ?

+ + + ? + ? ?

Vendors - Buyer Relationships

1
Time horizon
Concern for other party Trust Investment in relationship Nature of relationship
short
low

2
long
low

3
long
medium

4
long
high

low low

low low

medium low

high high

Conflict / bargaining

cooperation

accommodation

coordination

1= One time market transaction

2 = Functional

3 = Relational

4 = Strategic

Communication Process

The idea of a source process of encoding to produce a message to be carried by people or media in the form of promotional methods to receivers who go through the process of decoding the idea or message.

Communication Process

The idea of a source process of encoding to produce a message to be carried by people or media in the form of promotional methods to receivers who go through the process of decoding the idea or message.

Product

Price
Where to buy

Brand/store image
Services offered etc

Communication Process

The idea of a source process Retailer of encoding to produce a message to be carried by people or media in the form of promotional methods to receivers who go through the process of decoding the idea or message.

Communication Process

The idea of a source process of encoding to produce a message to be carried by people or media in the form of promotional methods to receivers who go through the process of decoding the idea or message.

Signs

Symbols
Color Picture Voice Written

Communication Process

The idea of a source process Sales people of encoding to produce a message to be carried by In-store displays people or media in the form of promotional methods to receivers who go through the process of decoding the idea or message.

Communication Process

The idea of a source process of encoding to produce a message to be carried by people or media in the form of promotional methods to receivers who go through the process of decoding the idea or message.

Advertising

Sales promotions
Personal selling Publicity

Communication Process

The idea of a source process Customers of encoding to produce a message to be carried by people or media in the form of promotional methods to receivers who go through the process of decoding the idea or message.

Communication Process

The idea of a source process Selecting of encoding to produce a Sorting message to be carried by people or media in the form of promotional methods to receivers who go through the process of decoding the idea or message.

Communication Process

The idea of a source process Desired outcome? of encoding to produce a message to be carried by people or media in the form of promotional methods to receivers who go through the process of decoding the idea or message.

Personal Selling - why sales are lost

1. 2.

3.
4. 5. 6. 7.

Show disinterest - talking to other customers/employees Making mistakes - acknowledge and say sorry Appearing too anxious Talking down other brands/outlets Arguing Being too long winded Lack of courtesy

Personal Selling - why sales are lost Contd

8.
9. 10.

11.
12. 13. 14.

Showing favoritism Too hurried Embarrassing the customer Misrepresentation Lack of product information Wasting time Getting too personal

Strategic Management
Develop retail strategy Identify the target market Determine the retail format Design organizational structure Select locations

Merchandise Management
Buy from vendors - locate, evaluate, negotiate, place order Control merchandise inventory develop budgets, allocate to stores, review stock positions Price merchandise - set initial prices, adjust prices

Store Management

Recruit & train personnel Plan work schedule Evaluate performance Maintain store facilities Locate and display merchandise Sell merchandise Repair and alter merchandise Provide customer service Handle complaints Take physical inventory Prevent shrinkage

Admin/Operations Management
1. Promote the firm, its merchandise and services:
Plan communications Develop budgets Select media Special promotions Design displays Public relations

Admin/Operations Management
contd
2. Manage human resources:
Personnel policies Recruit, train, manage Plan career paths Keep employee records

3. Distribute Merchandise:
Locate warehouses Receive, mark, label, store and ship Return merchandise to vendors

Admin/Operations Management
contd
4. Establish financial controls
Forecast sales, cash flow and profits Provide financial information Raise capital Bill and provide credit to customers

Retail Manager - Required Skills

Management skills
Master your job Understand authority and responsibility Develop a policy of honesty and integrity Deal with problems immediately Explain procedures and changes clearly Look for better methods Learn willingly and accept criticism Think positive

Retail Manager - Required Skills

Contd

Leadership skills
Develop an ability to influence others to achieve goals Have human skills: motivate people, understand needs & promote cooperation

Technical Skills - knowledge to perform various duties, tasks, jobs etc Conceptual skills - ability to see the big picture

Cues Customers Use To Evaluate Retail Services

Tangibles
Appearance of store Display Appearance of sales people

Understanding & knowing customer

Providing individual attention Recognizing regular customers

Cues Customers Use To Evaluate Retail Services Contd

Credibility
Honoring commitments Trustworthiness of sales staff Guarantee/warranty provided Return policy

Courtesy
Friendliness Respect Interest shown

Cues Customers Use To Evaluate Retail Services Contd

Information provided to customers

Explanation of services and cost Communications re: special offers Assurance re: problem solving

Access
Convenient location Shopping hours Access to manager

Cues Customers Use To Evaluate Retail Services Contd

Competence
Knowledge and skills of employees

Responsiveness
Returning customer calls Giving prompt service

Reliability
Accuracy in billing Performing service as promised

Retail Manager - Some Dos & Do Nots

Demonstrate organized thinking Know what and when to delegate Be fair Give recognition Let people know how they are doing Answer questions fully and honestly Set goals and build work schedules Accept changes Treat everyone as individuals Do not pass the buck

Retail Manager - Causes of Discontent

Failure to receive credit for ideas and suggestions Where does one stand with regard to performance Not being kept informed Failure to settle grievances Favoritism Criticism in presence of others Remaining aloof - not accepting opinions Not being held accountable

Personal Characteristics Needed To Start & Manage Own Business

Are you a leader? Do you like to make your own decisions? Do others turn to you for help in making decisions? Do you enjoy competition? Do you have willpower and selfdiscipline? Are you well organized?

Personal Characteristics Needed To Start & Manage Own Business contd

Do you plan ahead? Do you like people? Do you get along well with others? Do you like being your own boss? Are you physically fit? Are you a hands-on manager?
If

you answered YES to most of the questions, then you have it in you.

Demands Of Starting Your Own Business

It may require 12-15 hour days without a break Huge workload and rigorous schedule Require emotional strength to handle strain. Temporary lowering of living standard Will you family go along? May lose your savings? Do you believe in your capabilities? the answer YES to the above questions?

Is

Questions For Checking Marketing Plans Feasibility

1. 2.

3.
4.

5.

Can you clearly identify and briefly discuss the business you plan to start? Can you clearly define the retail format and mix you plan to offer? does your retail offering satisfy an unfilled need? Will you be competitive based on merchandise quality, assortment, price and quality? Will your retail offering serve an existing market where demand exceeds supply?

Questions For Checking Marketing Plans Feasibility contd

Do you know who your customer will be? 7. Do you know where your customers live? 8. Will your promotional programmes be effective? 9. Do you know how your business compares with your competition? 10. Will you be conveniently located for people you plan to serve?
6.

Supply Chain Management

This is an integrated approach towards managing the flow of physical goods right from sourcing of raw materials to the delivery of finished goods. The main objective is Customer Satisfaction. The necessary ingredients are: 1. Information access 2. Training 3. Confidence building

Salient Features of SCM

1.

2.

3.

4.
5.

Customer is the focus of all operations. Retaining existing customers and adding value to them on a continuous basis through closer interaction and understanding of their problems. Streamline operations and remove road blocks between customer and raw material supplier. Keep fixed costs minimal by out sourcing non core activities. Eliminate paperwork

Salient Features of SCM

6.

Contd

Reduce inventories and facilitate J.I.T. 7. Ensure transparency at all levels and operate as single integrated unit. 8. SCM is a customer synchronize positive technique. 9. Avoid multiple sourcing. Build confidence through long-term supply contracts. 10. Help continuous product improvement and cost reduction.

SCM - Logistics For Customer Satisfaction

1.
2. 3.

4.
5. 6. 7.

Network design Information technology Transportation Inventory and storage Warehousing Material handling Packaging