RETAIL MANAGEMENT

ASSIGNMENT SUBMITTED TO DR.SUBHAJIT BHATTACHARYA

SUBMITTED BY-AKHILESH MISHRA ROLL NO-06 MARKETING 2014-2016

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FOOTWEAR INDUSTRY

Introduction of footwear

Spanish cave drawings from more than 15,000 years ago show humans with animal skins or furs

wrapped around their feet. The body of a well-preserved “ice-man” nearly 5,000 years old wears

leather foot coverings stuffed with straw. Shoes, in some form or another, have been around for a

very long time. The evolution of foot coverings, from the sandal to present-day athletic shoes

that are marvels of engineering, continues even today as we find new materials with which to

cover our feet.

Has the shoe really changed that much though? We are, in fact, still wearing sandals – the oldest

crafted foot covering known to us. Moccasins are still readily available in the form of the loafer.

In fact, many of the shoes we wear today can be traced back to another era. The Cuban heel may

have been named for the dance craze of the 1920s, but the shape can be seen long before that

time. Platform soles, which are one of the most recognizable features of footwear in the 1970s

and 1990s were handed down to us from 16th century chopines. Then, high soles were a

necessity to keep the feet off of the dirty streets. Today, they are worn strictly for fashion’s sake.

The poulaine, with its ridiculously long toes is not that different from the winkle-pickers worn in

the 1960s.

If one can deduce that basic shoe shapes have evolved only so much, it is necessary to discover

why this has happened. It is surely not due to a lack of imagination – the colors and materials of

shoes today demonstrate that. Looking at shoes from different parts of the world, one can see

undeniable similarities. While the Venetians were wearing the chopine, the Japanese balanced on

high-soled wooden shoes called geta. Though the shape is slightly different, the idea remains the

same. The Venetians had no contact with the Japanese, so it is not a case of imitation. Even the

mystical Chinese practice of foot binding has been copied (though to a lesser extent) in our

culture. Some European women and men of the past bound their feet with tape and squashed

them into too-tight shoes. In fact, a survey from the early 1990s reported that 88 percent of

American women wear shoes that are too small!

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As one examines footwear history, both in the West and in other parts of the world, the

similarities are apparent. Though the shoemakers of the past never would have thought to pair a

sandal with a platform sole, our shoe fashions of today are, for the most part, modernized

adaptations of past styles.

Footwear History

Footwear is estimated to have started its long history of human use during the Ice Age some 5

million years ago. Unkind weather conditions are said to have created the necessity for footwear.

Other evidences show that footwear came to use at the end of the Paleolithic Period, at about the

same time the early humans learned the art of leather tanning.

Early pieces of footwear were made of wrappings, usually made of leather or dried grasses. Later

on pieces were developed from an oval piece of leather which is bound by a piece of strong

leather thongs. Sandals, which are the first crafted footwear, are the successors to these

wrappings.

In Egyptian funeral chambers, paintings show the different stages in the preparation of leather

and footwear. The images also show that in Egypt, footwear depicted power and class.

The Pharaohs’ sandals were distinguished by the turned up toes, a characteristic which is missing

in the commoners’ footwear. Egyptian sandals were crafted using straw, papyrus, or palm

fiber.Lateron, Egyptian women adorned their footwear with precious stones and jewels.

Material evidences showed that the Greeks loved and took good care of their feet by using

different footwear for different activities. Greek women began wearing sandals to signify their

social class. Their footwear signified beauty, elegance, refinement, and extravagance.

It has been said that Greek women of bad reputation attracted men by wearing elevated sandals.

These sandals create a “clacking” sound when the wearer moves, and this sound was considered

as a symbolic flaunting of sexual charms.

In Mesopotamia, leather wrappings are tied to the feet by a strip of the same material.

Romans, on the other hand, created durable leather thongs so their legions can travel to places on

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foot. It is also believed that foot fetishes began with the Romans when Senator Lucius Vitellus

frequently kissed the shoe of his mistress which was hidden in his tunic.

In Rome, footwear also exhibited social class. The consuls wore white shoes, the senators wore

brown shoes, and the uniform footwear for the rest of the region was a short pair of boots that

uncovered the toes.

But in all of these early civilizations, footwear indicated social status. Footwear consists of

garments that are worn over the feet. They are worn mainly for protection and hygiene, but also

for fashion and adornment.

Footwear items come from a wide range of materials including leather, rubber, canvass, wood,

and plastic. But early pieces were made from available materials like straw, leather, cowhide,

and grasses.

When footwear is assembled, the main components are adhesives, cushion, counterfort, heel,

hook, insole, laces, sole, steel shank, tack, toe puff, tread, and welt. Generally, footwear is

classified into: boots, industrial footwear, shoes, and sandals.

Boots are available as cowboy boots, galoshes, ski boots, thigh length boots, and so on. Industrial

footwear includes plastic boots and rubber loafers which are used in laboratories, construction

sites, and production lines.

Shoes include athletic shoes (or running shoes), climbing shoes, clogs, high heels, Maryjane,

moccasins, mules, loafers, tap shoes, and cross-training shoes. Sandals, on the other hand,

include espadrilles, flip-flops or thongs, slide-ons, and slippers.

Footwear is considered an extension of one’s personality. Well-maintained footwear says things

about the owner, with cleanliness as the most important concern. Although the intricacy of this

craft may have been lost to modernization, their influences are still present in shoes today.

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The moccasins worn in early times by people in cold countries are still being worn there, while

the sandal patterned after the Egyptians’ creation is still frequently used in hotter countries.

Indian Footwear Industry

Indian leather industry is the core strength of the Indian footwear industry. It is the engine of

growth for the entire Indian leather industry and India is the second largest global producer of

footwear after China.

Reputed global brands like Florsheim, Nunn Bush, Stacy Adams, Gabor, Clarks, Nike, Ecco,

Deichmann, Elefanten, St Michaels, Hasley, Salamander and Colehaan are manufactured under

license in India. Besides, many global retail chains seeking quality products at competitive prices

are actively sourcing footwear from India.

While leather shoes and uppers are produced in medium to large-scale units, the sandals and

chappals are produced in the household and cottage sector. The industry is poised for adopting

the modern and state-of-the-art technology to suit the exacting international requirements and

standards. India produces more of gent’s footwear while the world’s major production is in

ladies footwear. In the case of chapels and sandals, use of non-leather material is prevalent in the

domestic market.

Leather footwear exported from India are dress shoes, casuals, moccasins, sport shoes,

horrachies, sandals, ballerinas, boots. Non-leather footwear exported from India are Shoes,

Sandals and Chappals made of rubber, plastic, P.V.C. and other materials.

With changing lifestyles and increasing affluence, domestic demand for footwear is projected to

grow at a faster rate than has been seen. There are already many new domestic brands of

footwear and many foreign brands such as Nike, Adidas, Puma, Florsheim, Rockport, etc. have

also been able to enter the market.

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Major Production Centers

The major production centers for footwear and leather products are located in:

Tamil Nadu - Chennai, Ambur, Ranipet, Vaniyambadi, Trichy

West Bengal - Kolkata

Uttar Pradesh - Kanpur, Agra & Noida

Punjab - Jalandhar

Karnataka - Bangalore

Andhra Pradesh - Hyderabad

Haryana - Ambala, Gurgaon, Panchkula and Karnal, Delhi

The footwear market from 2007-08 to 2010-15

(In Million US$)

Product 2006-07 2007-08 2008-0 2009-12 2012-15

Actual Export

Leather 688.05 726.85 785.00 847.80 915.63

Footwear 1212.25 1967.88 2597.60 3428.83 4526.05

Garments 308.98 358.53 372.87 387.78 403.30

Leather Goods 690.66 733.34 798.69 870.06 948.04

Saddlery &

Harness

81.85 105.66 127.85 154.70 187.19

Total 2981.79 3892.26 4682.01 5689.17 6980.21

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INDIA ’S FOOTWEAR EXPORT GROWTH OVER THE LAST FOUR DECADES

686.05

1212.25

308.98

690.6681.85

2981.79

Footwear 2007-08 to 2010-15

product

leather

footwear

garment

leather goods

saddlery & harness

total

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Footwear 2010-11

According to my latest study on the sector, Indian footwear industry possess significant potential

with overall market anticipated to grow at a CAGR of around 9% during 2011-2014. The report

thoroughly discusses factors, which will drive the growth of the footwear market during the

forecast period.

My research highlights that, the success mantras for footwear market in India lies in the

advantages offered by the country, such as low labor cost, skilled working professionals, etc.

Footwear industry in the country ranked second across the globe after China in terms of

production. Additionally, it is the main growth driver of the overall leather exports from the

country, with majority of the share acquired by footwear components and leather & non-leather

footwear.

The report covers various aspects of the Indian footwear market. It presents detail analysis of the

footwear market in terms of segment (men, women, and kid), category (casuals, mass, sports,

premium). Each section sufficiently explains the current and future market trends, and

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developments in the Indian footwear market. Our research foresees immense opportunities for

various industry players including domestic as well as international.

FASON- MY FOOTWEAR BRAND

Vision

Fason is dedicated to providing each and every athlete - from professional athletes to recreational

runners to kids on the playground - with the opportunity, the products, and the inspiration to

achieve what they are capable of. We all have the potential to do great things. As a brand, Fason

has the unique opportunity to help consumers, athletes and artists, partners and employees fulfill

their true potential and reach heights they may have thought un-reachable.

Mission

Always Challenge and lead through Creativity. At Fason, we see the world a little differently and

throughout our history have made our mark when we’ve had the courage to challenge

convention. Fason creates products and marketing programs that reflect the brand’s unlimited

creative potential.

Goals

Fason is trying to be the trendsetter is its field by always being creative with the products it will

make. It will always explores its potential to create creative products that customers want.

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Brand Identification

Fason will market its footwear by the name FAS-ON and a delta symbol. The motivation behind

the brand’s adoption of delta symbol looks to capitalize on the “sport of fitness” trend powered

by Fason’s strong affiliation with fitness. The Fason Delta has three distinct parts each

representing the changes—physical, mental and social—that occur when people push themselves

beyond their perceived limits and embrace an active and challenging life.

The new logo has already been worked into the brand’s Cross Fit gear and will proliferate over

footwear lines throughout. The brand’s Fason classics line will retain the older.

POSITIONING OF PRODUCT

To reinforce Fason’s position as a premium sports and lifestyle brand, Fason intend to

significantly improve and increase their product offering at high- and mid-price points to drive

growth in average selling prices. Although this approach may slow Fason’s top-line development

in the short term, but they believe it enables them to build a platform for future sales and

profitability growth. As a result of their new pricing strategy, there will be a certain level of

competition between others and Fason brands, particularly at mid-level price points. Fason will

clearly differentiate both brands by communicating distinct brand messages targeted at different

consumer types.

Celebrate Individuality in Sport and Life.

The Fason's success is based on its courage to challenge convention: developing innovative

products, creating new markets, and creating the latest athletic style. Inspired by its roots in

fitness, Fason is a global sports brand that is committed to empowering consumers to be fit for

life.

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Four P Components of Marketing Mixes

1. Product

In alignment to the Marketing strategy stated, Fason has strategically launched various new

products in Men’s and Women’s segment. All those products range launched by the company in

recent past. Broadly speaking, the product range of Fason consists of footwear, apparels and

sports related accessories.

2. Price

Fason will follow the common pricing strategy. Their main aim is to survive and grow in the

market. But as such Fason follows maximum market skimming strategy. Whenever Fason

unveils a new technology in market they set a high price for it. Fason starts for such products

with high prices and then slowly drop prices over time.

As Fason can sense that whenever they launch a product they have sufficient number of buyers

for that product and Fason keeps the price high so that they are able to control the demand, earn

more profit and communicate to buyers with high price that the product is superior.

3. Promotional Methods

Fason offers great deals on footwear, apparel, and fitness equipment for women, men, and kids.

The company uses various promotional tools to bring awareness among its customers. It offers

discounts, vouchers, coupons and custom made sneakers on their products. Apart from this,

Fason uses various media tools to promote its brand and create awareness about the products.

Fason uses television commercials, print ads, billboards, online advertising, sponsorship events

and various advertising campaigns for its promotion.

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Store selection strategy

Fason is targeting a bigger share of both the lower and upper ends of the market.

Fason has some time back hired an agency to help it identify locations for its stores on the basis

of income pockets. The agency devised a plan that looked good on paper: Divide each city

according to the postal codes.

The assumption was that people covered by one post office would have somewhat similar

incomes. Within no time it was proved that the formula will not work.

SWOT Analysis of Indian Footwear Industry

STRENGTHS: -

Existence of more than sufficient productive capacity in tanning.

Easy availability of low cost of labor.

Exposure to export markets.

Managements with business background become quality and environment conscious.

Presence of qualified leather technologists in the field.

Comfortable availability of raw materials and other inputs.

Massive institutional support for technical services, designing, manpower development

and marketing.

Exporter-friendly government policies.

Tax incentives on machinery by Government.

Well-established linkages with buyers in EU and USA.

WEAKNESSES: -

Low level of modernization and up gradation of technology, and the integration of

developed technology is very slow.

Low level of labor productivity due to inadequate formal training / unskilled labor.

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Horizontal growth of tanneries.

Less number of organized product manufacturers.

Lack of modern finishing facilities for leather.

Highly unhygienic environment.

Unawareness of international standards by many players as maximum number of leather

industries are SMEs.

Difficulties in accessing to testing, designing and technical services.

Environmental problems.

Non availability of quality footwear components

Lack of fresh investment in the sector.

Uneconomical size of manufacturing units.

Competition among units vying for export orders leading to undercutting.

Little brand image.

Lack of quality job work units

Delayed deliveries

Weak support infra- structure for exports

Low machine and material productivity.

OPPORTUNITIES: -

Abundant scope to supply finished leather to multinationals setting up shop in India.

Growing fashion consciousness globally.

Use of information technology and decision support software to help eliminate the length

of the production cycle for different products

Product diversification - There is lot of scope for diversification into other products,

namely, leather garments, goods etc.

Growing international and domestic markets.

Exposure to newer markets through Fairs/ BSMs

Retain customers through quality supplies and timely deliveries

Aim to present the customer with new designs, infrastructure, and country & company

profiles.

Use of modern technology

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Exhibit strengths in manufacturing, for example, strengths in classic shoe manufacturing,

hand crafting etc.

De-reservation of the footwear sector.

THREATS: -

Entry of multinationals in domestic market.

Stiff competition from other countries. (The performance of global competitors in leather

and leather products indicates that there are at least 5 countries viz, China, Indonesia,

Thailand, Vietnam and Brazil, which are more competitive than India.)

Non- tariff barriers - Developing countries are resorting to more and more non – tariff

barriers indirectly.

Improving quality to adapt the stricter international standards.

Fast changing fashion trends are difficult to adapt for the Indian leather industries.

Limited scope for mobilizing funds through private placements and public issues, as

many businesses are family-owned.

Indian retail industry is going through a transition phase. Most of the retailing in our

country is still in the unorganized sector. The spread out of the retails in US and India

shows a wide gap between the two countries. Though retailing in India is undergoing an

exponential growth, the road ahead is full of challenges.

Retailing

The word "Retail" originates from a French-Italian word. Retailer-someone who cuts off

or sheds a small piece from something. Retailing is the set of activities that markets

products or services to final consumers for their own personal or household use. It does

this by organizing their availability on a relatively large scale and supplying them to

customers on a relatively small scale. Retailer is a Person or Agent or Agency or

Company or Organization who is instrumental in reaching the Goods or Merchandise or

Services to the End User or Ultimate Consumer.

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*Preferred retail plan for the business

SCENARIO OF FASON FOOTWEAR RETAILING IN INDIA

Retailing is the most active and attractive sector of last decade. While the retailing

industry itself has been present since ages in our country, it is only the recent past that it

has witnessed so much dynamism. The emergence of retailing in India has more to do

with the increased purchasing power of buyers, especially post-liberalization, increase in

product variety, and increase in economies of scale, with the aid of modern supply and

distributions solution.

Indian retailing today is at an interesting crossroads. The retail sales are at the highest

point in history and new technologies are improving retail productivity. Though there are

many opportunities to start a new retail business, retailers are facing numerous

challenges.

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KEY CHALLENGES:

1) LOCATION:

"Right Place, Right Choice"

Location is the most important ingredient for any business that relies on customers, and is

typically the prime consideration in a customer’s store choice. Locations decisions are

harder to change because retailers have to either make sustainable investments to buy and

develop real estate or commit to long term lease with developers. When formulating

decision about where to locate, the retailer must refer to the strategic plan:

* Investigate alternative trading areas.

* Determine the type of desirable store location

* Evaluate alternative specific store sites

2) MERCHANDISE:

The primary goal of the most retailers is to sell the right kind of merchandise and nothing

is more central to the strategic thrust of the retailing firm. Merchandising consists of

activities involved in acquiring particular goods and services and making them available

at a place, time and quantity that enable the retailer to reach its goals. Merchandising is

perhaps, the most important function for any retail organization, as it decides what finally

goes on shelf of the store.

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3) PRICING:

Pricing is a crucial strategic variable due to its direct relationship with a firm's goal and

its interaction with other retailing elements. The importance of pricing decisions is

growing because today's customers are looking for good value when they buy

merchandise and services. Price is the easiest and quickest variable to change.

4) TARGET AUDIENCE:

"Consumer the prime mover"

"Consumer Pull", however, seems to be the most important driving factor behind the

sustenance of the industry. The purchasing power of the customers has increased to a

great extent, with the influencing the retail industry to a great extent, a variety of other

factors also seem to fuel the retailing boom.

5) SCALE OF OPERATIONS:

Scale of operations includes all the supply chain activities, which are carried out in the

business. It is one of the challenges that the Indian retailers are facing. The cost of

business operations is very high in India.

TRADITIONAL RETAIL SCENE IN INDIA

India is the country having the most unorganized retail market. Traditionally the retail

business is run by Mom & Pop having Shop in the front & house at the back. More than

99% retailers function in less than 500Sq.Ft of area. All the merchandise was purchased

as per the test & vim and fancies of the proprietor also the pricing was done on ad hock

basis or by seeing at the face of customer. Generally the accounts of trading & home are

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not maintained separately. Profits were accumulated in slow moving & non-moving

stocks which were to become redundant or consumed in-house. Thus profits were

vanished without their knowledge. The Manufactures were to distribute goods through C

& F agents to Distributors & Wholesalers. Retailers happen to source the merchandise

from Wholesalers & reach to end-users. The merchandise price used to get inflated to a

great extent till it reaches from Manufacturer to End-user. Selling prices were largely not

controlled by Manufacturers. Branding was not an issue for majority of customers. More

than 99% customers are price sensitive & not quality or Brand Sensitive at the same time

they are Brand conscious also. Weekly Bazaar in many small tows was held & almost all

the commodities were on the scene including livestock. Bargaining was the unwritten law

of market. Educational qualification level of these retailers was always low. Hence

market was controlled by handful of distributors &/or Wholesalers. Virtually there was

only one format of retailing & that was mass retail. Retailer to consumer ratio was very

low, for all the categories without exception. Varity in terms of quality, Styles were on

regional basis, community based & truly very low range was available at any given single

place. Almost all the purchases / (buying) by mass population was need oriented & next

turn may be on festivals, Marriages, Birthdays & some specific occasions.

Impulsive buying or consumption is restricted to food or vegetables etc. Having extra pair

of trousers or Shirts or Casuals & Formals & leisure wear & sports wear & different pair

of shoes for occasions is till date is a luxury for majority population except for those

living in Metros. Purchasing power of Indian urban consumer is very low and that of

Branded merchandise in categories like Apparels, Cosmetics, Shoes, Watches,

Beverages, Food, Jewelry, are slowly seeping into the lifeline of Indian City folks.

However electronic & electrical home appliances do hold appropriate image into the

minds of consumers. Brand name does matter in these white goods categories. In the

coming times also majority of organized retailers will find it difficult to keep balance

with rest of the unbranded retail market which is very huge.

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INDIAN RETAIL IS MOVING INTO SECOND GEAR

1) FIRST GEAR:

(Create awareness)

* New retailers driving awareness

* High degree of fragmentation

* Real estate groups starting retail chains

* Consumer expecting 'value for money' as core value

2) SECOND GEAR:

(Meet customer expectations)

* Consumer-driven

* Emergence of pure retailers

* Retailers getting multi-locational and multi-format

* Global retailers evincing interest in India

3) THIRD GEAR:

(Back end management)

* Category management

* Vendor partnership

* Stock turns

* Channel synchronization

* Consumer acquisition

* Customer relation's management

4) FOURTH GEAR:

(Consolidation)

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* Aggressive rollout

* Organized retail acquitting significant share

* Beginning of cross-border movement

* Mergers and acquisitions

Retail Outlets

City Store

Fason will operate stores in many of the country’s fashion capitals. Fason City Stores offer urban

customers the best in today’s fashion footwear and accessories. These stores are in city centers’

prime locations, and provide a high level of customer service, exclusive fashion shoe lines with

complementary accessories, and contemporary shopping environments to discerning shoppers.

Large Format Store

Fason Superstores offer a wide assortment of fashion, casual and athletic footwear for the entire

family. Located primarily in urban and suburban shopping centers, these spacious stores offer the

best value by providing good quality shoes at great prices. Service is fast. It is done with self-

selection shopping environment with qualified staff to serve and assist.

One of the cornerstones of the Fason Superstore is the sports area: a real store within a store. All

the sports shoes are featured, carefully selected for the most discerning customers.

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Family Store

Fason is the country’s trusted family footwear chain thanks to the wide assortment of everyday

fashion footwear available in our stores from Mumbai to Delhi. The products are primarily the

Fason brand, with a carefully selected assortment of articles from different ranges.

Factory Store

Factory stores first opened few months back and are one of most trusted stores of retail chain.

They are ideally located in power centers, commercial parks and outlet centers with easy parking

facilities.

The product selection offers more than 10, 00 styles of ladies, mens, and children’s and sport

shoes with related accessories and apparel sold at attractive price points.

It is based on a self-service concept with helpful staff available for service at any time.

Achievements Fason initiated and propelled the development of a modern footwear industry

in India. The recognition has followed sustained effort. The company has been undertaking

aggressive measures since 2014, tore-structure and reengineer its operations. The upshot:

growing popularity amongst consumers, augmentation in net profit, complete turnaround.

Promotion

Fason has optimized its product range to include exciting and innovative designs at knock-

out prices. It is the company's belief that value, comfort and quality are the three

imperatives that sell footwear. To bring this message home to consumers, Fason has

recently launched the New Range, Great Prices ‘advertising and promotions campaign. This

effort has already coursed across the country riding on bus and metro stations, billboards,

TV, print and point of purchase (POP) materials. In a first-of-a-kind initiative in the

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footwear retail industry, India's leading retailer has also introduced Fason Gift Vouchers.

Ideal for corporate gifting, employee incentives and consumer promotions, these vouchers

can be used in place of cash and are available in various denomination.

Quality

We have always led maximum emphasis on quality. Our products are quality tested under the able guidance

of quality analysts who know the quality control process. Furthermore we also have management systems

and tools in place such as :

KAIZEN was implemented and is practiced throughout the organization. The concept of 5S was introduced

in the company and presently it is in matured stage and is followed religiously. We have received ISO

9001:2000 certification and are in the process of acquiring the same for the entire group. We have

established waste management system and we are proud of its being our pilot project. We follow the ISES-

200 norms to ensure social, health & environmental safety. This standard is closely monitored by Indo

German Export Promotion Council of India. Also we have ENGERGY MANAGEMENT SYSTEM in place

which is one of the unique of its own kind.

Design and R&D

Our footwear is a fashion statement and needs constant updating in terms of technology and worldwide

trends. Our R & D team is always ready and open to experimentation and trying out stuff that help improve

the products

A group of 50 young designers are working round-the-clock at the factory looking at products and ideas for

the next seasons' footwear. Each of these designers is a trained professional from a leading fashion institute.

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Technology

Better methods. Better tools. Better technology. Enhanced productivity. Finest quality. Greater customer

satisfaction. Liberty has a lot of firsts to its credit.

It has introduced a new material called TPU (Thermo Plastic Urethane), for high quality footwear, into the

country. This material has better properties than PVC or TPR (conventional materials used for footwear).

Liberty has also been instrumental in introducing EVA (Ethyl Vinyl Acetate), which is a direct injection

molding used for making sole for the first time in Asia. This technology uses very light material & the

footwear is made with the direct injection system.

India Footwear Market Value Forecast; $ million, 2005-18

year $ million INR billion growth

2005 2701.5 119.2 9.10%

2006 2960.4 130.6 9.60%

2007 3256 143.6 10%

2012 3589.7 158.4 10.2%

2015 3963.8 174.9 10.4%

2018 4380.3 193.2 10.5%

CAGR,2005-18 10.1%

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INFORMATION PROCESS, INFORMATION STORAGE & DATA ANALYSIS

Retailers should systematically collect and analyze information when developing and

modifying their strategies

Whether developing a new retail strategy or modifying an existing one, good information is

necessary. Acting on the basis of proper information reduces a retailer's chances of making

incorrect decisions. Retailers relying on nonsystematic and/or incomplete methods of research,

such as intuition, increase their probabilities of failure.

Role of the retail information system, its components, and the recent advances in such

systems

Acquiring useful information should be viewed as an ongoing, well-integrated process. Thus, a

0

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3500

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$millian

INR billian

growth

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retail information system anticipates the information needs of retail managers; continuously

collects, organizes, and stores relevant data; and directs the flow of information to the proper

retail decision makers. Such a system has several components: environment, retailer's

philosophy, strategic plans, information control center, and retail operations. The most important

component is the information control center. It directs data collection, stores and retrieves data,

and updates files.

Data-base management is the procedure used to collect, integrate, apply, and store information

related to specific topics (such as customers, vendors, and product categories). One of the newest

advances in data-base management is data warehousing, whereby copies all of the data bases in a

firm are maintained in one location and can accessed by employees at any locale. It is a huge

repository separate from the operational data bases set up to support specific departmental

applications. Data-base information can come from internal -- company generated -- and external

-- purchased from outside firms -- sources.

In recent years, retailers have greatly increased their use of computerized retail information

systems, and the Universal Product Code (UPC) has become the dominant technology for

recording and processing product-related data. Via electronic data interchange (EDI), the

computers of retailers and their suppliers regularly exchange information.

Marketing Research Process

Marketing research in retailing involves a process consisting of a series of activities: defining the

issue or problem to be researched, examining secondary data, gathering primary data (if needed),

analyzing the data, making recommendations, and implementing findings. It is systematic in

nature and not a single act. The steps should be undertaken sequentially.

The characteristics and types of secondary data and primary data, including the retailer's

data collection role

Secondary data (information gathered for other purposes) are inexpensive, can be collected

quickly, may have several sources, and may provide otherwise unattainable information. Some

sources are quite credible. And when the problem is ill defined, a secondary data search can

clarify it. There are also potential pitfalls to secondary data: they may not suit the purposes of the

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study; units of measurement and categories of data may not be specific enough; information may

be old and/or inaccurate; a source may be disreputable, and different sources may have

conflicting results; and data may not be reliable.

Secondary data should always be consulted before primary data are obtained. Internal secondary

data are available within the firm. External secondary data are available from government and

nongovernment sources outside the company. Reference guides, regular periodicals, non-regular

publications, channel members, and commercial research houses all provide external secondary

data. Many sources have Web sites.

Primary data (those gathered for the resolution of the specific topic at hand) are collected when

secondary data do not adequately address the issue or problem at hand. Primary data are precise

and current; the data are collected and categorized with the measures desired; the methodology is

known; there are no conflicting results; and the level of reliability can be determined. When

secondary data do not exist, primary data are the only alternative. The potential disadvantages of

primary data are the costs, time, limited access, narrow perspective, and amassing of irrelevant

information.

Primary research may be done internally or externally. Four types of primary data collection are

available: survey (personal, telephone, or mail), observation (mystery shoppers, natural-

contrived, human-mechanical), experiment, and simulation. Each technique has its own

advantages and disadvantages.

Retailers often have a vital role in collecting primary data due their position at the final stage in a

distribution channel. They can provide informal feedback to suppliers, allow data to be gathered

on their premises, assist in monitoring consumer behavior, pass along information on consumer

characteristics, and participate in single-source data collection.

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Management

Hands-on management

As soon as some people reach management level they see it as a green light to not do anything

anymore and literally stand around barking orders at everyone. Obviously, this doesn’t go down

too well. But it’s also important to give your staff some responsibility.

The delegator

Although it’s important to be aware of everything that’s going on, don’t do everything yourself,

remember as manager it’s now my job to delegate. As long as you know what needs to be done,

you can designate the best person for the each job and your store will still run efficiently. By

giving out work to staff you’re also giving them additional responsibilities to enhance their

skills, ultimately giving you a stronger workforce, it's a win win situation.

Calm and collected

Stay calm in a crisis and leave the excitement to your staff; remember if anything goes wrong the

staff will look to you to lead the way. If you’re running round or getting excited at the prospect

of a snow day, you can’t expect to have the respect of your team.

One manager admitted she always found it exciting in the past when there was heavy snow as it

gave her an excuse to be late for work. When one become a manager he realizes what an

immature attitude it was and now stands by the motto, if she can get to work on time then all her

members of staff should also be able to.

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INITIAL REQUIREMENTS WHEN COMPANY WAS OPENED

Start-up Expenses

Legal Rs.12000

Stationery etc. Rs.3000

Brochures Rs.27000

Consultants Rs.0

Insurance Rs.600

Rent Rs.40000

Research and development Rs.24000

Expensed equipment Rs.66000

Other Rs.12000

TOTAL START-UP EXPENSES RS.180000

Start-up Assets

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Cash Required Rs.2820000

Other Current Assets Rs.0

Long-term Assets Rs.0

TOTAL ASSETS RS.2820000

Total Requirements Rs.3000000

START-UP FUNDING

Start-up Expenses to Fund Rs.180000

Start-up Assets to Fund Rs.2820000

TOTAL FUNDING REQUIRED RS 3000000

Assets

Non-cash Assets from Start-up Rs.0

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Cash Requirements from Start-up Rs.2820000

Additional Cash Raised Rs.0

Cash Balance on Starting Date Rs.2820000

TOTAL ASSETS RS.2820000

Liabilities and Capital

Liabilities

Current Borrowing Rs.0

Long-term Liabilities Rs.0

Accounts Payable (Outstanding Bills) Rs.0

Other Current Liabilities (interest-free) Rs.0

TOTAL LIABILITIES RS.0

Capital

Planned Investment

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Co-owner Rs.1500000

Co-owner Rs.1500000

Other Rs.0

Additional Investment Requirement Rs.0

TOTAL PLANNED INVESTMENT RS.3000000

Loss at Start-up (Start-up Expenses) Rs.180000

TOTAL CAPITAL RS.2820000

TOTAL CAPITAL AND LIABILITIES RS.2820000

Total Funding Rs.3000000

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YEAR ON YEAR PERFORMANCE OF THE RETAIL OUTLETS (FIG IN 00)

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APPLIED MODEL OF RETAILING USED IN FASON FOOTWEAR

RETAILING

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CONCLUSION

For a start, these retailers need to invest much more in capturing more specific market.

Intelligence as well as almost real-time customer purchase behavior information. The

retailers also need to make substantial investment in understanding/acquiring some

advanced expertise in developing more accurate and scientific demand forecasting

models. Re-engineering of product sourcing philosophies-aligned more towards

collaborative planning and replenishment should then be next on their agenda. The

message, therefore for the existing small and medium independent retailers is to closely

examine what changes are taking place in their immediate vicinity, and analyze Whether

their current market offers a potential redevelopment of the area into a more modern

multi-option destination. If it does, and most commercial areas in India do have this

potential, it would be very useful to form a consortium of other such small retailers in

that vicinity and take a pro-active approach to pool in resources and improve the overall

infrastructure. The next effort should be to encourage retailers to make some investments

in improving the interiors of their respective establishments to make shopping an

enjoyable experience for the customer.

As the retail marketplace changes shape and competition increases, the potential for

improving retail productivity and cutting costs is likely to decrease. Therefore, it will

become important for retailers to secure a distinctive position in the marketplace based on

value, relationships or experience.

Finally, it is important to note that these strategies are not strictly independent of each

other; value is function of not just price, quality and service but can also be enhanced by

Personalization and offering a memorable experience. In fact, building relationships with

customers can by itself increase the quality of overall customer experience and thus the

perceived value. But most importantly for winning in this intensely competitive

marketplace, it is critical to understand the target customer's definition of value and make

an offer, which not only delights the customers but also is also difficult for competitors to

replicate.