sandeep report

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EVALUATION OF SALES PROMOTION-A CASE STUDY OF TASTY TREATBRAND OF BIG BAZAAR

EXCECUTIVE SUMMARY

The Indian retail industry is divided into organized and unorganized sectors.

Indias retail sector is wearing new clothes and with a three-year compounded annual growth rate

of 46.64%, retail is the fastest growing sector in the Indian economy. Traditional markets are

making way for new formats such as departmental stores, hypermarkets, supermarkets and

specialty stores. Western-style malls have begun appearing in metros and second-rung cities

alike, introducing the Indian consumer to an unparalleled shopping experience. However

organized retail is at a very nascent stage covering only 3% of retail market, which brings huge

opportunity to new players, with its present growth rate it is expected to grab 10% of retail

market within three-four years. The sector is the largest source of employment after agriculture,

and has deep penetration into rural India generating more than 10 per cent of Indias GDP.

Big Bazaar a hypermarket was established in the year 2001 with the vision to

address the hunger, i.e low price-premium quality, of middle and lower class population of the

country which is a huge chunk of opportunity. Big Bazaar is a chain of shopping malls in India

currently with 120 outlets, owned by the Pantaloon Group. It works on same the economy model

as Wal-Mart and has had considerable success in many Indian cities and small towns. The idea

was pioneered by entrepreneurKishore Biyani, the head of Pantaloon Retail India Ltd.

Sales promotion is short term tool used to reward the loyal customer, stimulus to

buy more than the plan and attracts the brand switchers. Advertising offers reason to buy, salespromotion offers an incentive to buy. One such tool used is Discounts where products are offered

at a price lesser than the MRP. Since the sales promotion involves Money, Time and Resource it

becomes very essential to evaluate the sales promotion from time to time. This report focuses on

EVALUATION OF SALES PROMOTION A case study of TASTY TREAT a brand of

BIG BAZAAR. The study includes three product category: Biscuits, Snacks and Mango juice.

The study was conducted in Big Bazaar for the period of 60 days, and was conducted with

objectives:

1. To evaluate sales promotion with respect to tasty treat brand.

2. To study customers perception about sales promotion of tasty treat brand.

3. To study customers preferences towards the promoted brands.

4. To study customer satisfaction about the sales promotion of tasty treat brand.

5. To identify the factor influencing the brand choice.

KOUSALI INSTITUTE OF MANAGEMEMENT STUDIES, DHARWAD Page 1
http://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Pantaloon_Grouphttp://en.wikipedia.org/wiki/Wal-Marthttp://en.wikipedia.org/w/index.php?title=Kishore_Biyani&action=edithttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Pantaloon_Grouphttp://en.wikipedia.org/wiki/Wal-Marthttp://en.wikipedia.org/w/index.php?title=Kishore_Biyani&action=edit


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RESEARCH METOHODLOGY:

The data was collected in two ways 1) Primary Data and 2) Secondary Data.

Selection of sample:

Population : Hubli-Dharwad

Sample size : 100

Sample method : Random Sample

Area of survey: In store (BIG BAZAAR).

Measurement and analysis technique:

Simple percentage method

Graphical representation using data code sheet

Major Outcomes of the Project:

1. The company achieved sales target (quantity) of Tasty Treat is in this year by

compromising on margin up to 8-9%.2. The survey reveals that while choosing brand from biscuits, snacks or mango juice

category, tasty treat is given last preference. This is mainly because of lack of awareness,

their previous experience about the brand, their perception about the brand.

3. The brand preference pattern remains same if the entire available brand on display is

promoted. Only the unique promotion is influential on customers.

4. The main cause for selecting a brand from biscuits, snacks or mango juice category is

their previous experience i.e Taste

5. No means of communication regarding the Tasty Treat is done. Only visitor gets a chanceto know about the brand. The main reason for not preferring the Tasty Treat is

unawareness factor.

6. 42% of customers are satisfied with the present sales promotion. Remaining 52% of

customer did not notice the promotion mainly because of other brand loyal, perceived

value of the brand.

Limitations:

1. Project study is not an exact science, so one cant accept 100% result, only justified

solutions are given.

2. The sample size is very small when it comes to footfall.

3. The findings are inferences of the study are limited to Hubli-Dharwad City

4. As the sample size is very small, hence the findings cannot be generalized.



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5. Response of the respondent might be biased which might have affected the findingsof the survey.

CHAPTER I

INTRODUCTION



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INTRODUCTION

Retailing is a sale of merchandise from a fixed location (such as kiranas,

hypermarket, mall etc) for final consumption by the customer. The concept of retailing can betraced back to the times when man stopped producing their entire requirement by themselves and

trading came into existence. Indian retail industry is all set to take a new contour i.e from

unorganized to organized retailing. Although presently share of organized retailing is very low

compared to the other countries like US, China, organized retailing in India is 3% of total retail

industry. But the pace at which it is growing is the best indications that it will rule the market

within next few years. With the opening up of market for FDI it is expected to grow at rate

greater than the present rate, but it will affect the small and unorganized retailer to the large

extent.

Big bazaar, a division of Pantaloons retail(India)limited, was started in 2001 first in

Mumbai. Which now has grown to the 120 big bazaar across 72 cities in India. Pantaloons has

extended its reach from premium or brand oriented customer to value for money oriented

customer, which caters to the need of all sections of customers with its various types of retailing

formats pantaloons has received a great applause from its customer. The customer satisfying

approach of Pantaloon has been appreciated by the customer in the way of ever increasing walk-

ins. In order to keep pace with increasing competition the company has came up with its own

products i.e they are marketing the product under the brand names like Tasty treat, Care mate,

Clean mate, John Miller, DJ&C, AFL etc. To cater to need of a price sensitive customer these

own brands are often run on promotional offers which are competitive to market leaders.

Sales promotion is an important component of a company's marketing

communication strategy along with advertising, public relations, and personal selling. At its core,

sales promotion is a marketing activity that adds to the basic value proposition behind a product

(i.e., getting more for less) for a limited time in order to stimulate consumer purchasing. As this

definition indicates, sales promotion may be directed either at end consumers. Sales promotion

stems from the premise that any brand or service has an established perceived price or value, the

"regular" price or some other reference value. Sales promotion is believed to change this

accepted price-value relationship by increasing the value and/or lowering the price. Familiar

examples of consumer sales promotion tools include contests and sweepstakes, branded give-

http://www.referenceforbusiness.com/encyclopedia/Man-Mix/Marketing.htmlhttp://www.referenceforbusiness.com/encyclopedia/Man-Mix/Marketing.html


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away merchandise, bonus-size packaging, limited-time discounts, rebates, coupons, free trials,

demonstrations, and point-accumulation systems.

Three issues clarify sales promotion. First, sales promotion ranks in importance with

advertising and requires similar care in planning and strategy development. Second, three

audiences can be targeted by sales promotion: consumers, resellers, and the sales force. And

third, sales promotion as a competitive weapon provides an extra incentive for the target

audience to purchase or support one brand over another. This last factor distinguishes sales

promotion from other promotional mix tactics. For example, unplanned purchases may be

directly related to one or more sales promotion offers.

Over recent years, sales promotion has become a particularly dynamic area within

the overall context of marketing communications. Although accurate figures are difficult to come

by, most industry pundits agree that, today, more money is spent below the line than above it.

Since the impact of sales promotion is, primarily, geared to the short term, it is inevitable that the

area should enjoy considerable growth at times of economic recession. Pressure on personal

levels of disposable income tends to make consumers significantly more price-sensitive, and

price-oriented sales promotions reflect this consumer pressure. Moreover, consumers have

become increasingly price- and value-sensitive. Instead of simply purchasing a particular brand,

many consumers use the basis of price in order to make their purchasing decisions. In many

categories, consumers have become increasingly used to the offer of some form of incentive.Increasing numbers of brands are effectively forced to continue providing such incentives to

satisfy the needs of consumers. However, it is also true that this growth has been influenced by

changing attitudes among marketers. In an increasingly competitive retail environment, and with

the concentration of buying power into relatively few hands, manufacturers have turned to sales

promotion to achieve on-shelf differentiation between their own products and those of their

competitors. It well known that the opportunity for real product differentiation is diminishing as

a result of the convergence of technology.

The variety of sales promotion techniques provides manufacturers with a

comparatively easy method of distinguishing their product from those of the competition within

the retail environment. The retail trade has also imposed other pressures on manufacturers to

focus their attention on promotions. Rising sophistication on the part of retailers and,

importantly, direct access to brand sales data collected at the point of purchase, have resulted in



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retailers demanding higher levels of promotional support from their suppliers in return for

continued distribution and display levels. Retailers are now more aware than ever before of the

financial contribution which an individual brand can make towards its overall profitability. In

their efforts to improve their own margins, pressure is brought to bear on manufacturers to

increase their rate of sale by the use of sales promotional devices. Manufacturers have little

choice but to agree, or face the possibility of having their product removed from the shelves.

Moreover, since the appeal of retailer products is often based on price, sales promotion has

provided manufacturers with the ability to adjust the retail price to the consumer in the short

term and minimize the differential. Undoubtedly, a major influence has been the desire for

short-term sales achievement in its own right. Sales promotion techniques are often seen as a

means of achieving the increases in sales volume with the benefit of improved market share and,

importantly, the ability to utilize excess manufacturing capacity. Since sales promotion

potentially has an immediate impact on consumer sales, there has been a tendency for product

managers to turn to these techniques in order to achieve their sales objectives. At the same time,

pressure on margins has made for closer attention to the detail of the achievement of cost-

effective sales volume. Since the results of the application of many promotional devices can be

predicted with a high degree of accuracy, product management can be confident in their volume

forecasts. Similarly, with the increasing costs of other forms of marketing communications,

especially that of advertising, management has turned to areas which are perceived to be morecost-effective especially for the achievement of short-term sales. The progressive

fragmentation of audiences and the increase in media costs have tipped the balance in favour of

sales promotion techniques which are more likely to deliver demonstrable results. A further

factor is the growing belief of product and sales management in their ability to handle the

techniques of sales promotion. Unlike other areas of marketing communications, sales promotion

is rarely subjected to the same level of internal debate as would be the case with, say,

advertising.

In a crowded promotional environment it is challenging to retain loyal consumers.

Too frequent use of promotions may evoke indifferent attitude among consumers or shape deal

to deal buying. Predictability of promotions (promotions linked to festivals like Diwali) may

result in coinciding purchase with such promotions leading to loss of margin an opportunity loss



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sell at full price.It is very much essential to plan such activities which will synergies companys

positioning and advertising campaign efforts rather than erode brand image or equity.

Therefore sales promotion is a double edged sword; if a proper use is made it can cut

competition and at the same time cluttering of promotion may affect the brand image. So it

becomes extremely important that company takes a proper care in implementing and evaluating

the performance sales from time to time.

This project is mainly concerned with evaluating such promotion which are running in

the big bazaar on the own brand tasty treat. Under the brand Tasty Treat big bazaar offers many

products to the customer but this study concentrates mainly on Biscuits, snacks (chips) and

Mango juice, which are currently being run on promotions.

TOPIC:

EVALUATION OF SALES PROMOTION A case study of TASTY TREAT a brand of

BIG BAZAAR.

Need for study:

Sales promotion has some specific objective, a product is given on discount by

spending the money from the companys profit pocket i.e a company has to compromise on its

margin. Also it involves time which is very precious to any company especially in retail industry,

and as it affects the brand image, sales promotion has to be evaluated from time to time.

As there are many ways to understand loyalty, there are also many ways to influence

and improve loyalty. Companies that measure customers beyond mere financial performance

levels can be shown to have stronger performance than non-measurement-driven companies in

multiple key indicators. A comparison of measurement-managed versus non-measurement-

managed organizations showed that (a) 83 percent of the measurement-managed group were

raced in the top third of their respective Indus-tries as compared to 52 percent for others, (b) 74 percent are recognized as industry leaders versus only 44 percent for non-measurement

organizations, (c) 80 percent realized a three-year positive return on investments as compared to

45 percent for non-measurement-managed organizations, and (d) a whopping 97 percent of

measurement-managed organizations experienced success in their last major change effort

compared to a 55-perccnt success rate for others.



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Objectives of the study:

1. To evaluate sales promotion with respect to tasty treat brand.

2. To study customers perception about sales promotion of tasty treat brand.

3. To study customers preferences towards the promoted brands.

4. To study customer satisfaction about the sales promotion of tasty treat brand.

5. To identify the factor influencing the brand choice.

RESEARCH METOHODLOGY

The data was collected in two ways, which are detailed below: -

Primary Data

Secondary Data

PRIMARY DATA: -

The Data collected for a specific purpose for the first time is Original known as Primary Data.

The primary data was basically collected through Questionnaire Method.

The Questionnaire method is a powerful tool to collect the information a structured

Questionnaire involves in asking the questions in a prearranged order. This research contained a

questionnaire that had structured (prearranged order), open ended (free answer questions) and

close ended (limited answer can be given) questions. Some were also dichotomous questions aremade best use. The survey was conducted within the store, responses were collected from the

individuals who visit to big bazaar. Apart from the questionnaire the information is collected

from the sales forces who are the best source to get such information. A interaction with the

executives, assistant department managers, department managers and officials within the store is

a vital information, which is also made use of in the study.

SECONDARY DATA: -

The data that is collected from the published sources i.e. not originally collected

for the first time is called secondary data. During the research the secondary data was

collected from Company website, Customer data base, Company report, Books and

publications, Related information from net



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Selection of sample

Population : Hubli-Dharwad

Sample size : 100

Sample method : Random Sample

Area of survey: In store (BIG BAZAAR).

Measurement and analysis technique

Simple percentage method

Graphical representation using data code sheet



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CHAPTER II

INDUSTRY PROFILE

COMPANY PROFILE

CONCEPTUAL FRAME WORK



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INDUSTRY PROFILE

Background

The Indian retail industry is divided into organized and unorganized sectors. Organized retailingrefers to trading activities undertaken by licensed retailers, that is, those who are registered for

sales tax, income tax, etc. These include the corporate-backed hypermarkets and retail chains,

and also the privately owned large retail businesses. Unorganised retailing, on the other hand,

refers to the traditional formats of low-cost retailing, for example, the local kirana shops, owner

manned general stores, paan/beedi shops, convenience stores, hand cart and pavement vendors,

etc. Indias retail sector is wearing new clothes and with a three-year compounded annual growth

rate of 46.64 per cent, retail is the fastest growing sector in the Indian economy. Traditional

markets are making way for new formats such as departmental stores, hypermarkets,

supermarkets and specialty stores. Western-style malls have begun appearing in metros and

second-rung cities alike, introducing the Indian consumer to an unparalleled shopping

experience. The Indian retail sector is highly fragmented with 97 per cent of its business being

run by the unorganized retailers like the traditional family run stores and corner stores. The

organized retail however is at a very nascent stage though attempts are being made to increase its

proportion to 9-10 per cent by the year 2010 bringing in a huge opportunity for prospective new

players. The sector is the largest source of employment after agriculture, and has deep

penetration into rural India generating more than 10 per cent of Indias GDP.

Comparative Penetration of Organised Retail (in %)



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Source: Ernst &Young, the Great Indian Retail Story, 2006

India is the 4th largest economy as regards GDP (in PPP terms) and is expected to rank 3rd by

2010 just behind US and China. On one hand where markets in Asian giants like China are

getting saturated, the AT Kearney's 2006 Global Retail Development Index (GRDI), for the

second consecutive year Placed India the top retail investment destination among the 30

emerging markets across the world. Over the past few years, the retail sales in India are hovering

around 33-35 per cent of GDP as compared to around 20 per cent in the US.

The table gives the picture of Indias retail trade as compared to the US and China.

Retail Trade India, US and ChinaTrade

(US$ billion)

Employment

( %)

Shops

(million)

Organized sector share

( %)

India 180-394 7 12 2-3

China 360 12 2.7 20

US 3800 12.6-16 15.3 80

Source: The Economist, 2006

The last few years witnessed immense growth by this sector, the key drivers being changing

consumer profile and demographics, increase in the number of international brands available in

the Indian market, economic implications of the Government increasing urbanization, credit

availability, improvement in the infrastructure, increasing investments in technology and real

estate building a world class shopping environment for the consumers. In order to keep pace with

the increasing demand, there has been a hectic activity in terms of entry of international labels,

expansion plans, and focus on technology, operations and processes. This has lead to more

complex relationships involving suppliers, third party distributors and retailers, which can be

dealt with the help of an efficient supply chain. A proper supply chain will help meet the

competition head-on, manage stock availability; supplier relations, new value-added services,

cost cutting and most importantly reduce the wastage levels in fresh produce.



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Large Indian players like Pantaloons, Reliance, Ambanis, K Rahejas, Bharti AirTel, ITC

and many others are making significant investments in this sector leading to emergence of big

retailers who can bargain with suppliers to reap economies of scale. Hence, discounting is

becoming an accepted practice. Proper infrastructure is a pre-requisite in retailing, which would

help to modernize India and facilitate rapid economic growth. This would help in efficient

delivery of goods and value-added services to the consumer making a higher contribution to the

GDP. International retailers see India as the last retailing frontier left as the Chinas retail sector

is becoming saturated. However, the Indian Government restrictions on the FDI are creating

ripples among the international players like Walmart, Tesco and many other retail giants

struggling to enter Indian markets. As of now the Government has allowed only 51 per cent FDI

in the sector to one-brand shops like Nike, Reebok etc. However, other international players are

taking alternative routes to enter the Indian retail market indirectly via strategic licensing

agreement, franchisee agreement and cash and carry wholesale trading (since 100 per cent FDI is

allowed in wholesale trading).

Current Status

Indias retail industry accounts for 10 percent of its GDP and 8 percent of the employment to

reach $17 billion by 2010. The Indian retail market is estimated at US$ 350 billion. But

organised retail is estimated at only US$ 8 billion. However, the opportunity is huge-by 2010,organised retail is expected to grow at 6 per cent by 2010 and touch a retail business of $ 17

billion as against its current growth level of 3 per cent which at present is estimated to be $ 6

billion, according to the Study undertaken by The Associated Chambers of Commerce and

Industry of India (ASSOCHAM). Indian retailing is clearly at a tipping point. India is currently

the ninth largest retail market in the world. And it is names of small towns like Dehradun,

Vijayawada, Lucknow and Nasik that will power India up the rankings soon.

Organised retail in India has the potential to add over Rs. 2,000 billion (US$45 billion) business

by the Year 2010 generating employment for some 2.5 million people in various retail operations

and over 10 million additional workforces in retail support activities including contract

production & processing, supply chain & logistics, retail real estate development & management

etc. It is estimated that it will cross the $650-billion mark by 2011, with an already estimated

investment of around $421 billion slated for the next four years.



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Organized Retail Penetration across categories (%)

Source: E&Y, the Great Indian Retail Story, 2006

As noticed in the figure above, the Organized Retail Penetration (ORP) is the highest in footwear

with 22 per cent followed by clothing. Though food and grocery account for largest share of

retail spend by the consumer at about 76 per cent, only 1 per cent of this market is in the

organized sector. However, it has been estimated that this segment would multiply five times

taking the share of the organized market to 30 percent in the coming years.

Segment analysis

The structure of Indian retail is developing rapidly with shopping malls becoming increasingly

common in the large cities and development plans being projected at 150 new shopping malls by

2008. However, the traditional formats like hawkers, grocers and tobacconist shops continue to

co-exist with the modern formats of retailing. Modern retailing has helped the companies to

increase the consumption of their products for example: Indian consumers would normally

consume the rice sold at the nearby kiranas viz. Kolam for daily use. With the introduction of

organized retail, it has been noticed that the sale of Basmati rice has gone up by four times than itwas a few years back; as a superior quality rice (Basmati) is now available at almost the same

price as the normal rice at a local kirana. Thus, the way a product is displayed and promoted

influences its sales. If the consumption continues to grow this way it can be said that the local

market would go through a metamorphoses of a change and the local stores would soon become

the things of the past or restricted to last minute unplanned buying.



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Food and grocery retail

The food business in India is largely unorganized adding up to barely Rs.400 billion, with other

large players adding another 50 per cent to that. The All India food consumption is close to

Rs.9,000 billion, with the total urban consumption being around Rs.3,300 billion. This means

that aggregate revenues of large food players is currently only 5 per cent of the total Indian

market, and around 15-20 per cent of total urban food consumption. Most food is sold in the

local wet market, vendors, roadside push cart sellers or tiny kirana stores. According to

McKinsey report, the share of an Indian household's spending on food is one of the highest in the

world, with 48 per cent of income being spent on food and beverages.

Apparel retail

The ready-mades and western outfits are growing at 40-45 per cent annually, as the market teems

up with international brands and new entrants entering this segment creating an Rs.5 billion

market for the premium grooming segment. The past few years has seen the sector aligning itself

with global trends with retailing companies like Pantaloons, Shoppers stop and Crossroads

entering the fray to entice the middle class. However, it is estimated that this segment would

grow to Rs. 3 billion in the next three years.

Gems and Jewellery retail

The gems and jewellery market is the key emerging area, accounting for a high proportion of

retail spends. India is the largest consumer of gold in the world with an estimated annualconsumption of 1000 tonnes, considering actual imports and recycled gold. The market for

jewellery is estimated as upwards of Rs. 650 billion.

Pharmaceutical retail

The pharma retailing is estimated at about Rs. 300 billion, with 15 per cent of the 51 lakh retail

stores in India being chemists. Pharma retailing will follow the trend of becoming more

organised and corporatised as is seen in other retailing formats (food, apparel etc). A few

corporates who have already forayed into this segment include Dr Morepen (with Lifespring and

soon to be launched Tango), Medicine Shoppe, Apollo pharmacies, 98.4 from Global Healthline

Pvt Ltd, and the recently launched CRS Health from SAK Industries. In the south, RPG groups

Health & Glow is already in this category, though it is not a pure play pharma retailer but more

in the health and beauty care business.



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Music Retail

The size of the Indian music industry, as per this Images-KSA Study, is estimated at Rs.11

billion of which about 36 percent is consumed by the pirated market and organized music

retailing constitutes about 14 percent, equivalent to Rs.1.5 billion.

Book retail

The book industry is estimated at over Rs. 30 billion out of which organized retail accounts for

only 7 per cent (at Rs.2.10 billion). This segment is seen to be emerging with text and curriculum

books accounting to about 50 per cent of the total sales. The gifting habit in India is catching on

fast with books enjoying a significant share, thus expecting this sector to grow by 15 per cent

annually.

Consumer durables retail

The consumer durables market can be stratified into consumer electronics comprising of TV sets,

audio systems, VCD players and others; and appliances like washing machines, microwave

ovens, air conditioners (A/Cs). The existing size of this sector stands at an estimated US$ 4.5

Billion with organized retailing being at 5 per cent.

RETAILING FORMATS

Modern retailing has entered India in form of sprawling malls and huge complexes offering

shopping, entertainment, leisure to the consumer as the retailers experiment with a variety offormats, from discount stores to supermarkets to hypermarkets to specialty chains. However,

kiranas still continue to score over modern formats primarily due to the convenience factor. The

organized segments typically comprise of a large number of retailers, greater enforcement of

taxation mechanisms and better labour law monitoring system. It's no longer about just stocking

and selling but about efficient supply chain management, developing vendor relationship quality

customer service, efficient merchandising and timely promotional campaigns. The modern retail

formats are encouraging development of well-established and efficient supply chains in each

segment ensuring efficient movement of goods from farms to kitchens, which will result in huge

savings for the farmers as well as for the nation. The Government also stands to gain through

more efficient collection of tax revenues. Along with the modern retail formats, the non-store

retailing channels are also witnessing action with HLL initiating Sangam Direct, a direct to home

service. Network marketing has been growing quite fast and has a few large players today. Gas



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stations are seeing action in the form of convenience stores, ATMs, food courts and pharmacies

appearing in many outlets. In the coming years it can be said that the hypermarket route will

emerge as the most preferred format for international retailers stepping into the country. At

present, there are 50 hypermarkets operated by four to five large retailers spread across 67 cities

catering to a population of half-a-million or more. Estimates indicate that this sector will have

the potential to absorb many more hypermarkets in the next four to five years.

TYPES OF RETAIL FORMATS

Specialty Store: Narrow product line with deep assortment, viz apparel stores, book stores etc.

A clothing store would be a single line store, men's clothing store would be limited line store &

men's custom-shirt store would be a super specialty store. Example: The limited, Body Shop.

Departmental Store: Several product lines-typically clothing, household goods, home

furnishings- with each line operated as a separate department managed by specialist buyers or

merchandisers.

Example: Sears, Bloomingdales.

Supermarkets: Relatively large, low-cost, low-margin, high volume, self-service operation

designed to serve total needs for food, laundry & household maintenance products.

Example: Kroger, Safeway.

Convenience Stores: Relatively small store located near residential area, open long hours, sevendays a week and carrying a limited line of high-turnover convenience products at slightly higher

prices.Example: 7-Eleven, Circle K.

Discount Store: Standard merchandise sold at lower prices with lower margins and higher

volumes. True discount stores regularly sell merchandise at lower prices and offer mostly

national brands. Example: Wal-Mart, Kmart.

Retail Organization mainly falls into 4 major categories

1. Corporate chains: Example > Pantaloons, Westside

2. Retail Co-operative: Example > Amul, Samavaika, Khadi Gram Yudog

3. Consumer Co-operative: Example > Apna Bazar

4. Franchise Organization: Example > Monginis, Caf Coffee day.



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Off-price retailer: Merchandise bought at less than regular wholesale prices & sold at less than

retail; often-leftover goods, overruns and irregulars obtained at reduced prices from

manufacturers or other retailers.

Factory outlets are owned and operated by manufacturers and normally carry the manufacturer's

surplus, discontinued or irregular goods.

Example: Mikasa(dinnerware), Dexter (shoes)

Independent off-price retailers are owned & run by entrepreneurs or by divisions of larger

retail corporations. Example: T.J.Maxx, Filene's Basement.

Warehouse clubs (or wholesale clubs) sell a limited selection of brand name grocery items,

appliances, clothing and other goods sold at deep discounts to members who pay an annual

membership fees. Warehouse clubs serve small businesses & group members from government

agencies, nonprofit organizations and some large corporations. They operate in huge, low-

overhead, warehouse like facilities & offer few frills. They offer rock bottom prices- typically

20% to 40% below super market and discount stores prices but make no home deliveries and

accept no credit cards. Example: Sam's Clubs, Max Clubs.

Superstore: Averages 35,000 square feet of selling space traditionally aimed at meeting

consumers' total needs for routinely purchased food and non food items. Usually offer services

such as laundry, dry cleaning, shoe repair, check cashing & bill paying.

A new group called "category killers" carries a deep assortment in a particular category & aknowledgeable staff. Example: Borders books & Music, IKEA.

Combination stores are a diversification of the supermarket store into the growing drug-and-

prescription field. Combination food & drug stores average 55,000 square feet of selling space.

Example: Jewel & Osco stores.

Hypermarkets range between 80,000 and 220,000 square feet and combine supermarket,

discount & warehouse retailing principles. Product assortment goes beyond routinely purchased

goods & includes furniture, large & small appliances, clothing items and many other items. Bulk

display & minimum handling by store personnel with discounts offered to customers who are

willing to carry heavy appliances and furniture out of the store. Hypermarkets originated in

France. Example: Carrefour and Casino (France), Pyrca, Continente and Alcampo (Spain),

Meijer's (Netherlands)



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Traditionally, the small store (kirana) retailing has been one of the

easiest ways to generate self-employment, as it requires minimum investments in terms of land,

labour and capital. These stores are not affected by the modern retailing as it is still considered

very convenient to shop. In order to keep pace with the modern formats, kiranas have now

started providing more value-added services like stocking ready to cook vegetables and other

fresh produce. They also provide services like credit, phone service, home delivery etc. The

organized retailing has helped in promoting several niche categories such as packaged fruit

juices, hair creams, fabric bleaches, shower gels, depilatory products and convenience and health

foods, which are generally not found in the local kirana stores. Looking at the vast opportunity in

this sector, big players like Pantaloons, Reliance and K Rahejas has announced its plans to

become the country's largest modern retainers by establishing a chain of stores across all major

cities.

List of retailers that have come with new formats

Retailer Current Format New Formats,Experimenting with

Pantaloon Own brand store Hypermarket

Shoppers Stop Department Store Quasi-mall

Ebony Department Store Quasi-mall, smaller outlets, adding food

retail

Crossword Large bookstore Corner shops

Piramyd Department Store Quasi-mall, food retail

Subhiksha Supermarket Considering moving to self-service

Vitan Supermarket Suburban discount store

Foodworld Food supermarket Hyper market, Foodworld express

Globus Department Store Small fashion stores

Bombay Bazaar Aggregation of Kiranas

Efoodmart Aggregation of Kiranas

Metro Cash and Carry

S Kumars Discount Store



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Apart from metro cities, several small towns like Nagpur, Nasik, Ahmedabad,

Aurangabad, Sholapur, Kolhapur and Amravati as witnessing the expansion of modern retails.

Small towns in Maharashtra are emerging as retail hubs for large chain stores like Pantaloon

Retail because many small cities like Nagpur have a student population, lower real estate costs,

fewer power cuts and lower levels of attrition. However, retailers need to adjust their product

mix for smaller cities, as they tend to be more conservative than the metros. In order for the

market to grow in modern retail, it is necessary that steps are taken for rewriting laws,

restructuring the tax regime, accessing and developing new skills and investing significantly in

India.

Merger and acquisition activity:

India witnessed a record number of M&A deals in the first half of 2006, which were collectively

worth US$ 25.6 billion. A significant number of deals have being carried out Corporate CatalystIndia A report on Indian Retail Industry in the Indian retail sector in the past few months in order

to acquire a larger share in the growing domestic market and to compete against the prospective

global and domestic players. The table below shows some recent deals that have taken place in

the Indian retail sector:

Year Acquired/ JV

Company/Target

Acquirer Nature of

Business

Stake

(%)

Consideration

(US$ million)

2005 Liberty Shoes Future group Retail

(Footwear)

51 3

2005 Indus League

Clothing

Future group Retail clothing 68 5

2005 Odyssey India Deccan

Chronicle

Holdings

Leisure retail

chain

(books, music,

toys)

100 14

2005 Landmark Tata Trent Books, music,

Accessories

74 24

2006 Bistro

Hospitality

TGI Fridays Restaurant

(Food

retail)

25 N/A

2006 Indus League

Clothing (Future group

company)

Etam group,

France

Lingerie and

womens wear

retailing

50 (JV) 8

Source: PricewaterhouseCoppers, Asia-Pacific M&A bulletin, Mid year 2006.

COMPETITION OVERVIEW



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Pantaloon Retail

Pantaloon Retail (India) Limited, is Indias leading retail company with presence across multiple

lines of businesses. The company owns and manages multiple retail formats that cater to a wide

cross-section of the Indian society and is able to capture almost the entire consumption basket of

the Indian consumer. Headquartered in Mumbai (Bombay), the company operates through 6

million square feet of retail space, has over 140 stores across 72 cities in India and employs over

30,000 people. The company registered a turnover of Rs 20.19 billion for FY 2005-06. Pantaloon

Retail forayed into modern retail in 1997 with the launching of fashion retail chain, Pantaloons in

Kolkata. In 2001, it launched Big Bazaar, a hypermarket chain that combines the look and feel of

Indian bazaars, with aspects of modern retail, like choice, convenience and hygiene. The groups

subsidiary companies include, Home Solutions Retail India Ltd, Pantaloon Industries Ltd,

Galaxy Entertainment and Indus League Clothing. The group also has joint venture companies

with a number of partners including French retailer Etam group, Lee Cooper, Manipal

Healthcare, Talwalkars, Gini & Jony and Liberty Shoes. Planet Retail, a group company owns

the franchisee of international brands like Marks & Spencer, Debenhams, Next and Guess in

India.

Lifestyle International

Lifestyle International Holdings Ltds principal activity is the operation of lifestyle department

store and retail outlets. It focuses on high-end department store format. As of December 31,2005, Lifestyle International operated its retailing business through two brand names, SOGO and

Jiuguang. The SOGO Department Stores consists of the Company's flagship department store,

SOGO CWB, in Causeway Bay, Hong Kong, and the Tsimshatsui store, which features a slightly

different format that targets younger group of customers. The Jiuguang Department Store, which

is located in Shanghai, has a similar business format as that of the SOGO store. During the year

ended December 31, 2005, it launched SOGO CLUB, a lifestyle service center. Some of the

Companys subsidiaries include Asia Kinetic Limited, Congenial Company Limited, Eastlord

Development Limited, Everwin Worldwide Limited and Fine Shine Limited.

RPG Retail

RPG Enterprises is one of Indias largest business conglomerates, with a turnover of US$ 1.65

billion (Rs 7,472 crore) and assets worth US$ 1.8 billion. Since its inception in 1979, RPG

Enterprises has been one of the fastest growing groups in India with more than 20 companies



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operating successfully in 7 business sectors: Retail, IT & Communications, Entertainment,

Power, Transmission, Tyres and Life Sciences. Spencers retail is the largest supermarket chain

in India. Spencers retail offers the complete gamut of products & durables ranging from bread to

bed covers; from toothpaste to television. Spencers today is operating across 80 stores spread

across 20 cities in the country with a retail trading area of more than half a million square feet,

and rapidly growing. Spencers Retail is located in various parts of India like Chennai,

Hyderabad, Vizag, Bangalore, Mumbai, Aurangabad, Pune, Ghaziabad, Faridabad, Delhi,

Cochin, Trivandrum and many more to come by this financial year.

Shoppers Stop

The foundation of Shoppers Stop was laid on October 27, 1991 by the K. Raheja Corp. group of

companies. From its inception, Shoppers Stop has progressed from being a single brand shop to

becoming a Fashion & Lifestyle store for the family. Shoppers Stop is the only retailer from

India to become a member of the prestigious Intercontinental Group of Departmental Stores

(IGDS). The IGDS consists of 29 experienced retailers from all over the world, which include

established stores like Selfridges (England), Karstadt (Germany), Shanghai No. 1 (China),

Matahari (Indonesia), Takashimaya (Japan), C K Tang (Singapore), Manor (Switzerland) and

Lamcy Plaza (Dubai). This membership is restricted to one member organization per

country/region.

Trent (Tata)Trent (Tata) was established in 1998, Trent operates some of the nations largest and fastest

growing retail store chains. A beginning was made in 1998 with Westside, a lifestyle retail chain,

which was followed up in 2004 with Star India Bazaar, a hypermarket with a large assortment of

products at the lowest prices. In 2005, it acquired Landmark, Indias largest book and music

retailer. In a recently signed deal, Trent has agreed to anchor 12 malls set up by DLF Universal

Ltd across the country, at its Westside, Landmark and Star India Bazaar outlets. This amounts to

about 27 locations, totaling to about a million square feet of space.

Vivek Ltd

Vivek Limited, is the largest Consumer Electronics & Home Appliances retail chain in India,

with 14 world class showrooms in Chennai, Bangalore and Salem; covering a retail space area of

over 1,00,000 sq. ft and a turnover of over Rs. 1 billion (US $ 23 Million). Its brand, VIVEKS, is

now a household name. The groups turnover, comprising of interests in distribution of consumer



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products; finance, safe deposit lockers; property development and real estate, is about 2 Billion

(US $ 46 Million). Vivek Ltd proposes to expand its operations in Karnataka and also open

outlets in Andhra Pradesh. The company is working on a plan to open three retail outlets in

Mysore, Hubli and Mangalore in Karnataka and in Hyderabad, Vijayawada and Visakhapatnam

in Andhra Pradesh. Viveks currently has 22 showrooms in 5 cities.

INVESTMENT POLICY AND INITIATIVES

FDI Policy in the Retail Sector:

India has kept the retail sector largely closed to outsiders to safeguard the livelihood of nearly 15

million small storeowners and only allows 51 per cent foreign investment in single-brand retail

with prior Government permission. FDI is also allowed in the wholesale business. Single-brand

retailers such as Louis Vuitton, Fendi, LLadro, Nike and Toyota can operate now on their own.

Metro is already operating through the cash-and-carry wholesale mode.

The policy makers continue to explore areas where FDI can be invited without hurting

the interest of local retail community. Government is considering opening up of the retail trading

for select sectors such as electronic goods, stationery, sports goods, and building equipment.

Foreign direct investment (FDI) in retail space, specialized goods retailing like sports goods,

electronics and stationery is also being contemplated. The Government has to walk a tightrope to

ensure a `level playing field' for everyone. The policy of permitting 51 per cent FDI in single-

brand product retailing has led to the entry of only a few global brands such as Nike (footwear),

Louis Vuitton (shoes, travel accessories, watches, ties, textiles ready-to wear), Lladro (porcelain

goods), Fendi (luxury products), Damro (knock-down furniture), Argenterie Greggio (silverware,

cutlery, traditional home accessories and gift items) and Toyota (retail trading of cars), into retail

trading. A 12-billion euro French luxury industry is also eyeing the domestic luxury segment to

make a presence through retailing directly.

Business models for entry in Indian markets



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Due to the FDI restrictions the international players are looking for alternative avenues to enter

the Indian markets. However FDI restrictions in retailing have not deterred prominent

international players from setting up shops in India.

In recent developments, the Australian retail giant Woolworth Ltd made in innovative entry in

Indias retail space, with Indias Tata group. The Tata group has floated Infiniti Retail Ltd, in

venture with which will sell consumer goods and electronics across the country. Infiniti Retail

will be a 100 per cent subsidiary of Tata Sons and will receive an initial equity infusion of Rs 4

billion. This Tata retail venture joined hands with Australian retail giant Woolworths Ltd, which

currently operates more than 2,000 stores in 12 different formats. While Infiniti will own and run

retail operations in India, Woolworths, which has attained notable success in selling electronics

and consumer goods through its Dick Smith Electronics chain, will provide technical support and

strategic sourcing facilities from its global network. At present entry into Indias retail sector can

be done in multi branding also which has been opened for FDI very recent but previously there

are three different routes through which FDI flows in the Indian retail sector. The chart below

shows the current formats permitted by the Government of India for the international players.



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Current entry options for foreign players

Franchise agreements Most widely used entry route by multinational retailers

Fast food retailer Dominos entered India through master

franchise root while Pizza Hut entered through regional

franchisee

Cash and Carry

wholesale trading

100% FDI is allowed in wholesale trading which involves

building of a large distribution infrastructure to assist local

manufacturers

The wholesaler deals only with smaller retailers and not

consumers

Metro AG of Germany was the first significant global

player to enter India through this route

Strategic licensing

agreements

Foreign company enters into a licensing agreement with a

domestic retailer Mango, the Spanisn apparel brand has entered India

through this route with an agreement with Piramyd,

Mumbai

SPAR entered into a similar agreement with Radhakrishna

Foodlands Pvt. Ltd

COMPANY PROFILE



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BOARD OF DIRECTORS OF FUTURE GROUP

Mr. Kishore Biyani Managing Director & FUTURE GROUP CEO

Mr. Gopikishan Biyani Wholetime Director

Mr. Rakesh Biyani Wholetime Director

Mr. Shailesh Haribhakti Director

Mr. S. Doreswamy Director

Dr. Darlie Koshy Director

Mr. Anil Harish Director

Ms. Anju Poddar Director

Ms. Bala Deshpande Director

Mr. Ved Prakash Arya Director

Group Vision

Future Group shall deliver Everything, Everywhere, Everytime for Every Indian Consumer in the

most profitable manner.

GROUP MISSION

We share the vision and belief that our customers and stakeholders shall be served only by

creating and executing future scenarios in the consumption space leading to economicdevelopment.

We will be the trendsetters in evolving delivery formats, creating retail realty, making

consumption affordable for all customer segments for classes and for masses.

We shall infuse Indian brands with confidence and renewed ambition.

We shall be efficient, cost- conscious and committed to quality in whatever we do.

We shall ensure that our positive attitude, sincerity, humility and united determination shall be

the driving force to make us successful.

CORE VALUE

Indianness: confidence in ourselves.



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Leadership: to be a leader, both in thought and business.

Respect & Humility: to respect every individual and be humble in our conduct.

Introspection: leading to purposeful thinking.

Openness: to be open and receptive to new ideas, knowledge and information.

Valuing and Nurturing Relationships: to build long term relationships.

Simplicity & Positivity: Simplicity and positivity in our thought, business and action.

Adaptability: to be flexible and adaptable, to meet challenges.

Flow: to respect and understand the universal laws of nature.

Pantaloon Retail (India) Limited, is Indias leading retailer that operates multiple retail formats in

both the value and lifestyle segment of the Indian consumer market. Headquartered in Mumbai

(Bombay), the company operates over 16 million square feet of retail space, has over 1000 stores

across 73 cities in India and employs over 30,000 people. The companys leading formats include

Pantaloons, a chain of fashion outlets, Big Bazaar, a uniquely Indian hypermarket chain, Food

Bazaar, a supermarket chain, blends the look, touch and feel of Indian bazaars with aspects of

modern retail like choice, convenience and quality and Central, a chain of seamless destination

malls. Some of its other formats include Brand Factory, Blue Sky, aLL, Top 10 and Star and

Sitara. The company also operates an online portal, futurebazaar.com. Future Value Retail

Limited is a wholly owned subsidiary of Pantaloon Retail (India) Limited. This entity has beencreated keeping in mind the growth and the current size of the companys value retail business, led

by its format divisions, Big Bazaar and Food Bazaar. The company operates 120 Big Bazaar

stores, 170 Food Bazaar stores, among other formats, in over 70 cities across the country, covering

an operational retail space of over 6 million square feet. As a focussed entity driving the growth of

the group's value retail business, Future Value Retail Limited will continue to deliver more value

to its customers, supply partners, stakeholders and communities across the country and shape the

growth of modern retail in India. A subsidiary company, Home Solutions Retail (India) Limited,

operates Home Town, a large-format home solutions store, Collection i, selling home furniture

products and eZone focused on catering to the consumer electronics segment.

Pantaloon Retail is the flagship company of Future Group, a business group catering to the entire

Indian consumption space.

http://www.futurebazaar.com/http://www.futurebazaar.com/


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FUTURE GROUP

Future Group, led by its founder and Group CEO, Mr. Kishore Biyani, is one of Indias leading

business houses with multiple businesses spanning across the consumption space. While retail

forms the core business activity of Future Group, group subsidiaries are present in consumer

finance, capital, insurance, leisure and entertainment, brand development, retail real estate

development retail media and logistics. Led by its flagship enterprise, Pantaloon Retail, the group

operates over 16 million square feet of retail space in 73 cities and towns and 65 rural locations

across India. Headquartered in Mumbai (Bombay), Pantaloon Retail employs around 30,000

people and is listed on the Indian stock exchanges. The company follows a multi-format retail

strategy that captures almost the entire consumption basket of Indian customers. In the lifestyle

segment, the group operates Pantaloons, a fashion retail chain and Central, a chain of seamless

malls. In the value segment, its marquee brand, Big Bazaar is a hypermarket format that combines

the look, touch and feel of Indian bazaars with the choice and convenience of modern retail.

The groups speciality retail formats include supermarket chain - Food Bazaar, sportswear retailer -

Planet Sports, electronics retailer - eZone, home improvement chain -Home Town and rural retail

chain - Aadhaar, among others. It also operates popular shopping portal -

Future Group believes in developing strong insights on Indian consumers and building businesses

based on Indian ideas, as espoused in the groups core value of Indianness. The groups corporate

credo is, Rewrite rules, Retain values.Persons constituting Group coming within the definition of Group for the purpose of

Regulations 3(1)(e) of the Securities and Exchange Board of India (Substantial Acquisition of

Shares and Takeovers) Regulations, 1997, includes the following persons:

1. Mr. Kishore Biyani 11. Pantaloon Industries Limited

2. Mr. Gopikishan Biyani 12. Varnish Trading Private Limited

3. Mr. Laxminarayan Biyani 13. Manz Retail Private Limited

4. Mr. Vijay Biyani 14. Erudite Trading Private Limited

5. Mr. Sunil Biyani 15. Chaste Investrade Private Limited

6. Mr. Anil Biyani 16. Future Realtors India Private Limited

7. Mr. Rakesh Biyani 17. Future Capital Investment Private Limited

8. Ms. Ashni Biyani 18. Future Ideas Company Limited

9. Mr. Vivek Biyani 19. Akar Estate & Finance Private Limited



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10. PFH Entertainment Limited

SUBSIDIARIES AND ASSOCIATES

FUTURE GROUP has four subsidiaries (i) Home Solutions Retail (India) Limited (HSRIL) (ii)

PFH Investment Advisory Company Limited (PIACL) (iii) PAN India Restaurants Limited

(PIRL) (iv) Pantaloon Food Product (India) Limited (PFPIL)

I. Home Solutions Retail (India) Limited

Home Solutions Retail (India) Limited was incorporated under the Companies Act, 1956 on

October 4, 2004 and has its registered office is at Pantaloon Knowledge House, Shyam Nagar, Off.

Jogeshwari Vikhroli Link Road, Jogeshwari (East), Mumbai 400 060 . The main business of Home

Solutions Retail (India) Limited is to act as general retailers in the home textiles and furnishing

business. The stores will offer customised home solutions by in-house designers, fabrics, tailoring

facilities and innovative services like budget homes etc. It will cater to home management

requirements and products, including furnishings and textiles, furniture, consumer electronics,

home electricals and home services

II. PFH Investment Advisory Company Limited

PFH Investment Advisory Company Limited was incorporated under the Companies Act, 1956 onDecember 31,2004. Its registered office is at Pantaloon Knowledge House, Shyam Nagar, Off.

Jogeshwari Vikhroli Link Road,Jogeshwari (East), Mumbai 400 060. The main business of PFH

Investment Advisory Company Limited is to carry on the business of providing financial

investment advisory services, management and facilitation services, including but not limited to

identifying investment opportunities, providing investment recommendations and consultancy

service for making available infrastructure to venture capital funds, including the trustees,

beneficiaries and contributories of such fund, other funds, trusts, investment companies, joint

ventures, corporate, institutional, group and individual investors.

III PAN India Restaurants Limited

PAN India Restaurants Limited was incorporated under the Companies Act, 1956 on February 7 ,



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2005. Its registered office is at Pantaloon Knowledge House, Shyam Nagar, Off. Jogeshwari

Vikhroli Link Road, Jogeshwari (East), Mumbai 400 060 . The main business of PAN India

Restaurants Limited is to carry on the business of quick service restaurants and food courts through

restaurants, food court, hotels, eating houses, dhabas, bars, cafeterias, resorts, club houses,

roadhouses, motels, holiday camps, caravans, site and apartment housekeeper, retail format stores,

hypermarkets, supermarkets, mega stores/discount stores, departmental stores, shoppers plaza,

direct to home and mail order catalogue through internet and other forms for all food products and

services and amusement and recreation parks/facilities, and casinos and gaming facilities of every

kind or sort including providing all attendant conveniences, amenities and facilities adjunct and to

serve food and food products.

IV Pantaloon Food Product (India) Limited

Pantaloon Food Product (India) Limited was incorporated under the Companies Act, 1956 on

April 13, 2005. Its registered office is at Pantaloon Knowledge House, Shyam Nagar, Off.

Jogeshwari Vikhroli Link Road,Jogeshwari (East), Mumbai 400 060 .

The main business of Pantaloon Food Product (India) Limited is to manufacture and supply

food products.

Associates Companies

I) Kshitij Venture Capital FundKshitij Venture Capital Fund (KVCF) is a domestic venture capital fund registered with the

Securities and Exchange Board of India. KVCF was set up under an indenture of trust dated

December 15, 2004. While PRIL is the Settlor, IL&FS Trust Company Limited is the the

trustees. PFH Investment Advisory Company Limited was appointed as the investment

advisor to KVCF to manage the business affairs of the Trust vide Investment Advisory

Agreement dated April 14, 2005.

KVCF has been set up to invest in entities engaged in the real estate sector dealing more

specifically in immovable property of any kind and any rights therein. KVCF has limited

operations, hence the financials are not available.

II) Galaxy Entertainment Corporation Limited

Galaxy Entertainment Corporation Limited (Galaxy) was incorporated under Companies



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Act, 1956 on August 13, 1981. Its registered office is at 54, Free Press Marg, 215 Nariman

Point, Mumbai 400 021.

We have acquired 20,00,000 equity shares constituting 15.73% stake in the company through

a Share Subscription Agreement dated March 4, 2005.

Galaxy is currently engaged in the business of leisure and entertainment, running restaurants,

bowling alley and various games. Galaxy has two subsidiaries viz; Galaxy Rain Restaurants

Private Limited and Ceezee Foods Private Limited.

Galaxy has two subsidiaries:

a) Ceeze Foods Private Limited

Ceeze Foods Private (CFPL) was incorporated under Companies Act, 1956 on April 13,

2000. Its registered office is at A-602, Prathamesh, Raghuvanshi Mills Compound, Lower

Parel, Mumbai 400 013.

The Company is engaged in the business of running directly or indirectly, through franchising

or otherwise within India or outside India restaurants, hotels, shopping malls, swimming

pools, clubs and other recreational facilities of all kinds.

b) Galaxy Rain Restaurants Private Limited

Galaxy Rain Restaurants Private Limited was incorporated under Companies Act, 1956 onApril 12, 2000. Its registered office is at A-602, Prathamesh, Raghuvanshi Mills Compound,

Lower Parel, Mumbai 400 013. Galaxy Rain Restaurants Private Limited is a wholly

owned subsidiary of Galaxy.

The main object of the Company is to carry on business of restaurants, cafes, refreshments

rooms, clubs and casinos of every sort and kind, to establish shops, canteens, kitchens, and

any other establishments, for this purpose and for the sale of food and drink of every sort and

kind and to arrange for and provide all manner of entertainment, amusements, recreation and

instruction for the public.

JOINT VENTURE COMPANIES

I. Planet Sports Private Limited (India)



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Planet Sports Private Limited (India) was incorporated under the Companies Act, 1956 on

November 15,1999. Its registered office is at 7A & 8A, Gaurav Towers, Malviya Nagar.

Jaipur, Rajasthan. They have acquired 28,40,880 equity shares constituting 49% stake in the

company vide Joint Venture agreement dated February 2, 2005. Planet Sports Private Limited

(India) is a sports, leisure and lifestyle retail store. There are 25 Planet Sports Stores in Inida. The

product range includes footwear, apparel, caps, accessories, tennis racquets, golf clubs and balls,

swimwear and accessories, water sports etc. Planet sports is the exclusive franchisee of The

Atheletes Foot-footwear chain in India. Planet Sports wholly owned subsidiary, Supreme Trade

Links Limited is the exclusive franchisee for Marks & Spencer stores in India. Besides, it is the

exclusive licensee and distributor for brands such as Puma and Speedo in India.

II. Proposed Joint Venture with Liberty Shoes Limited

An MOU has been signed with Liberty Shoes Limited on August 29, 2005 to enter into a Joint

Venture for setting up a chain of stores for retailing of footwear and other accessories. For this

purpose the new company is proposed to be set up , with an authorized share capital of Rs. 250

million. Under the terms of the Agreement, company will acquire a 51% stake in the new company

by subscribing to 12.75 million equity shares of Rs.10 each at par aggregating to Rs. 127.5 million

as equity contribution.

BIG BAZAAR

Big Bazaar is a chain of shopping malls in India currently with 29 outlets, owned by the PantaloonGroup. It works on same the economy model as Wal-Mart and has had considerable success in

many Indian cities and small towns. The idea was pioneered by entrepreneurKishore Biyani, the

head of Pantaloon Retail India Ltd. Big Bazaar stores in Metros have a gaming area and kids play

area for entertainment. Major cities where stores are located are, Agra, Ahmadabad, Allahabad,

Ambala, Asansol, Bangalore, Bhubaneswar, Chennai, Coimbatore, Palakkad, Kolkata, Delhi,

Durgapur, Ghaziabad, Gurgaon, Hyderabad, Indore, Lucknow, Kanpur, Mangalore, Mumbai,

Nagpur, Nasik, Panipat, Pune, Rajkot, Surat, Thane, Thiruvananthapuram, Vishakhapatnam.

Big Bazaar is not just another hypermarket. It caters to every need of customers family. Where

Big Bazaar scores over other stores is its value for money proposition for the Indian customers.

At Big Bazaar, customer will definitely get the best products at the best prices -- thats what Big

Bazaar guarantee. With the ever increasing array of private labels, it has opened the doors into the

world of fashion and general merchandise including home furnishings, utensils, crockery, cutlery,

http://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Pantaloon_Grouphttp://en.wikipedia.org/wiki/Pantaloon_Grouphttp://en.wikipedia.org/wiki/Wal-Marthttp://en.wikipedia.org/w/index.php?title=Kishore_Biyani&action=edithttp://en.wikipedia.org/wiki/Agrahttp://en.wikipedia.org/wiki/Ahmedabadhttp://en.wikipedia.org/wiki/Allahabadhttp://en.wikipedia.org/wiki/Ambalahttp://en.wikipedia.org/wiki/Asansolhttp://en.wikipedia.org/wiki/Bangalorehttp://en.wikipedia.org/wiki/Bhubaneswarhttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Coimbatorehttp://en.wikipedia.org/wiki/Palakkadhttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Delhihttp://en.wikipedia.org/wiki/Durgapurhttp://en.wikipedia.org/wiki/Ghaziabadhttp://en.wikipedia.org/wiki/Gurgaonhttp://en.wikipedia.org/wiki/Hyderabad_(India)http://en.wikipedia.org/wiki/Indorehttp://en.wikipedia.org/wiki/Lucknowhttp://en.wikipedia.org/wiki/Kanpurhttp://en.wikipedia.org/wiki/Mangalorehttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Nagpurhttp://en.wikipedia.org/wiki/Nasikhttp://en.wikipedia.org/wiki/Panipathttp://en.wikipedia.org/wiki/Punehttp://en.wikipedia.org/wiki/Rajkothttp://en.wikipedia.org/wiki/Surathttp://en.wikipedia.org/wiki/Thanehttp://en.wikipedia.org/wiki/Thiruvananthapuramhttp://en.wikipedia.org/wiki/Vishakhapatnamhttp://en.wikipedia.org/wiki/Indiahttp://en.wikipedia.org/wiki/Pantaloon_Grouphttp://en.wikipedia.org/wiki/Pantaloon_Grouphttp://en.wikipedia.org/wiki/Wal-Marthttp://en.wikipedia.org/w/index.php?title=Kishore_Biyani&action=edithttp://en.wikipedia.org/wiki/Agrahttp://en.wikipedia.org/wiki/Ahmedabadhttp://en.wikipedia.org/wiki/Allahabadhttp://en.wikipedia.org/wiki/Ambalahttp://en.wikipedia.org/wiki/Asansolhttp://en.wikipedia.org/wiki/Bangalorehttp://en.wikipedia.org/wiki/Bhubaneswarhttp://en.wikipedia.org/wiki/Chennaihttp://en.wikipedia.org/wiki/Coimbatorehttp://en.wikipedia.org/wiki/Palakkadhttp://en.wikipedia.org/wiki/Kolkatahttp://en.wikipedia.org/wiki/Delhihttp://en.wikipedia.org/wiki/Durgapurhttp://en.wikipedia.org/wiki/Ghaziabadhttp://en.wikipedia.org/wiki/Gurgaonhttp://en.wikipedia.org/wiki/Hyderabad_(India)http://en.wikipedia.org/wiki/Indorehttp://en.wikipedia.org/wiki/Lucknowhttp://en.wikipedia.org/wiki/Kanpurhttp://en.wikipedia.org/wiki/Mangalorehttp://en.wikipedia.org/wiki/Mumbaihttp://en.wikipedia.org/wiki/Nagpurhttp://en.wikipedia.org/wiki/Nasikhttp://en.wikipedia.org/wiki/Panipathttp://en.wikipedia.org/wiki/Punehttp://en.wikipedia.org/wiki/Rajkothttp://en.wikipedia.org/wiki/Surathttp://en.wikipedia.org/wiki/Thanehttp://en.wikipedia.org/wiki/Thiruvananthapuramhttp://en.wikipedia.org/wiki/Vishakhapatnam


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sports goods and much more at prices that will surprise customer. And this is just the beginning.

Big Bazaar plans to add much more to complete customers shopping experience.

Store study

Big Bazaar

Akshay centre, Akshay Park

GOKUL ROAD, HUBLI-580030

Phone No: 0836-4266555

This store is of 2 flour and divided into 2 levels based on the nature of products. There are 21

departments in this store and 120 Human Resource employed.

As this store is big enough with 2 levels and 21 departments has long product range and product

depth. Ones a customer get inside the store he will find all kinds of products available that may be

Food item, Cosmetic, Electronic, Garments, Furniture etc.

Because of these features it has a very good reputation in that area and customers who are residing

far away and in other areas they also visit the store.

Level 1

Departments

1) Depot:

2) NBD (New Business Development)3) Gold Bazaar

4) Mobile Bazaar

5) Star Sitara

6) Shringar

7) Ladies Department

8) Mens Department

9) Furniture Department

10) Footwear Bazaar

11) Home Dcor

12) Home line

13) Toys Dept

14) Kids department



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15) Electronic Bazaar

16) Luggage

Level 2

Food Bazaar

1) Beverages

2) Confectionaries

3) Fruits & Vegetables

4) Staples

5) Process Dept

Non-food Dept

6) Home care

7) Personal care

8) Plastics, Utensils, Crockery (PUC)

SECURITY MEASURES

Pantaloon Apparel, food, etc. POS: Home-grown solution

SAP Retail

BI and Data warehouse: Congos (process of evaluation)

handheld scanners at Food Bazaar

VPN: Company-wide network linking all the branchesThey have loss prevention cell (LPC) thatwill be looking after the safety measures in the organizations. There are 5 members in each store.

They have 3 types of tags

Hard tag Soft tag String tag

These tags will be attached to the materials. If any person will take that without paying bill some

process will be taken by the LPC.

Process: In case any theft is done in big bazaar they will catch the person & they will fine him and

they will fill one form that he had done the mistake & they will take all 10 fingers thumb

impression.

Departmental Managers

There are 24 departments in this store like Electronic dept, Depot dept, NBD dept, Mobile Bazaar

Dept, Star sitar Dept, PUC Dept, Ladies Dept, Mens Dept, Furniture Dept, Footwear Dept, and



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Home Dcor Dept. Each department will be assigned with targets, which have to be achieved

within the assigned period that may be of Daily, Weekly, monthly and yearly.Each department has

a department Manager & Assist DM. Their job is concerned mainly with sales. They look after

customers orders delivery post sale service if any etc. All Dept managers ADM, Team members

work under coordination & cooperation.They are also responsible for the placing orders of the

goods incase of shortage here they have to send indent specifying the amount of products needed at

the store. They have to report periodically the performance of the department to the store manager.

Administration

Store administration comes under Store Manager its functions are store maintenance, House

Keeping, Security etc. Store manager has to control all the activities within the store. He has to

communicate all the departmental managers and assistance departmental managers regarding any

new offers, regarding their targets etc. Sore manager has to see the operation at the store is being

performed in coordination and cooperation he has to communicate with the corporate office

regarding any changes being applied at the store.

Information Technology

This department is responsible for the maintenance of the systems of the stores. All billing

machines their functioning networking with the master machine etc. If there is any problem with

the machine then this department comes into function.

Cashing DeptThis department is responsible for the collection of sales amount i.e. cash sales, Credit sales, etc

under this department all billing machines of the stores comes. The sales amount collected

throughout the day by the cashiers has to be submitted to this department.

Marketing

This dept is responsible for the marketing of the store in different media like Television,

Newspaper, and Holdings etc. the authorized person has to visit different companies and has to

look after for tie-ups etc. The executives arranges rallys

Visual Merchandise

This department is responsible for the product arrangement at the store with respect to their nature.

The basic function of this dept is it divides the store into several departments based on the nature

of the product and within the department it decides how the products should be arranged by

keeping in mind the customer should not suffer.



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Human Resource

Human Resource basically works for the welfare of the employees. It acts to organize the

manpower and work to increase productivity of the employees. Basically Human Resource

performs the functions of Recruitment, Hiring, Induction, Training and development, Performance

appraisal of the employees. Human Resource studies and involves in inter life cycle of the

employee from his joining the organization to till his end from the organization.

CSD (Customer Service Desk)

This is the separate unit, which is mainly focuses on customer service like if the customer find

difficulty in finding any product, Customer complaints any replacement, Customer assistance

etc.

Supply chain management:

Companys supply chain was split into the broad categories of fashion, food and general

merchandise, leading to a more focused approach to businesses, improved service levels, better

customization of logistic and supply chain related needs, and finally deliverables. Further, with

new concepts and lines of business being included during the year, as well as strategic alliances

with other companies, the process of gradually integrating them have either been completed or

close to completion.

The existing supply chain design consists of a Master Distribution Centre (MDC) and city

warehouses upgraded to Regional Distribution Centers (RDCs) and additional Distribution Centers(DCs). The company had one MDC and 16 RDCs and DCs

The company has also appointed leading international and domestic players in the warehouse

infrastructure and technology front.

The company also introduced the concept of reverse logistics that looks at setting up a process to

transfer finished goods from the consumption point to the point of origin.

This reduces wastage and can lead to significant cost savings. On the technology front, all the

existing MDCs, RDCs and DCs are live on SAP, thereby facilitating standardization, real time

data management and reporting, as well as optimum operational efficiencies.

CONCEPTUAL FRAMEWORK

SALES PROMOTION:



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It a key ingredient in marketing campaigns, consists of a collection of incentive

tools, mostly short term, designed to stimulate quicker or greater purchase of particular products

or services by customer. Whereas advertising offers reason to buy, sales promotion offers an

incentive to buy. Major consumer promotion tools are

1. Samples: offer of a free amount of a product or service delivered door to door, sent in the

mail, picked up in a store, attached to another product, or featured in an advertising offer.

2. Coupons: certificate entitling the bearer to a stated saving on the purchase of a specified

product, mailed, enclosed in other products or attached to them or inserted in a magazine

and newspapers ads.

3. Cash refund offers(rebate): provide a price reduction after purchase rather than at the

retail shop. Consumer sends a specified proof of purchase to the manufacture who

refunds part of the purchase price by mail.

4. Price packs(cents-off deals): offers to consumers of savings off the regular price of a

product, flagged on the label or package. A reduced-price pack is a single package sold at

a reduced price (such as two for the price of one). A banded pack is two related products

banded together (such as a toothbrush and toothpaste).

5. Premiums(gifts): Merchandise offered at a relatively low cost or free as an incentive to

purchase a particular product. A with-pack premium accompanies the product inside or

on the package. A free in the mail premium is mailed to consumers who send in a proofof purchase, such as a box top or upc code. A self liquidating premium is sold below its

normal retail price to consumers who request it.

6. Frequency programs: Programs providing rewards related to the consumers frequency

and intensity in purchasing the companys products or services.

7. Prizes (contests, sweepstakes, games): Prizes are offers of the chance to win cash, trips,

or merchandise as a result of purchasing something. A contest calls for consumers to

submit an entry to be examined by a panel of judges who will select the best entries. A

sweepstakes asks consumers to submit their names in a drawing. A game presents

consumers with something every time they buy bingo numbers, missing letterswhich

might help them win a prize.

8. Patronage Awards: Values in cash or in other forms that are proportional to patronage of

a certain vendor or group vendors.



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Usage of sales promotion activities has a direct impact on behavior as it motivates a consumer to

buy now rather than in future, enhances value of an offer temporarily till the promotion period,

encourages switching, reinforce or reward loyalty etc. Broadly, objectives set for these activities

are; i)to generate store traffic, ii) to move excess inventory, iii)to enhance store image and iv)to

create a price image( high or low). Traffic building is achieved by special event promotions like

Diwali, Rakshabandhan promotions; inventory reduction through end of season sale; creation

and building store image through feature advertising and displays and joint promotions and price

image by highlighting the discounts. It helps consumer reduce not only financial risk but also

psychological and social risk by making consumer confident of his/her purchase, conformation

to group norms by shopping at famous stores/brands and possibility of acquiring well known

branded apparel during promotions. Promotions may induce non buyers to walk in to the store

and loyalty programmes may encourage to buy more, more often or upgrade to better quality.

Exciting promotions also have tendency to generate positive word of mouth and help consumer

feel a smart shopper. Thus not only utilitarian benefits like, saving of money, time or quality

upgradation but hedonic benefits like feeling confident, feeling of excitement and entertainment

etc.

Managerial challenges

It is evident that use of sales promotions is quite widespread and variety of activities are usedto address variety of objectives; clear off old stock, load the consumer, encourage brand

switching, to reward the loyal user, to create excitement at point of purchase etc. In a crowded

promotional environment it is challenging to retain loyal consumers. Too frequent use of

promotions may evoke indifferent attitude among consumers or shape deal to deal buying.

Predictability of promotions (promotions linked to festivals like Diwali) may result in coinciding

purchase with such promotions leading to loss of margin an opportunity loss to sell at full price.

A manager needs to be aware of these problems and have to plan strategies to overcome them.

Loyalty card programmes require good administ

sandeep report

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