Giant organizations like Wal-Mart and Reliance have began to try and take over the Indian retail sector. The accessibility of the giant corporate and business retail in India's food market will have immediate impact on India's 650 million farmers and 40 million people used in tiny retail. A lot more than 6600 mega stores are prepared with Rs40, 000 crore by 2011. Our circumstance is intended for two primary targets that are: First, when experts and giants like future group WalMart and Reliance they are prepared to start businesses in retail the type of strategies and composition they might be having to have the competitive border over one another and proven small and unorganized merchants. Second, what kind of impact has been on other sellers including unorganized ones with the opening of Reliance Fresh stores.
In the following case results about Reliance Fresh were quite awakening and exemplary. Even after recent shutdown of Reliance fresh stores from UP and unwelcoming vibes from says like Kerala, Western Bengal, Orissa and Jharkhand for its retail format (that was allegedly taking the unorganized sector and going out of thousands of one-man shop people jobless) Reliance had not been in any spirits to hamper its 25000 crore plan. Reliance responded with superb strategy in which it shifted its concentrate from store to being a dealer i. e. targeting hawkers, vendors, Push cart wheelers rather than customers. Big stores like Reliance have huge resources and network which directly impacted many of the retailers a few of whom are planning to quit. Inside our sample size of 75 retailers more than 30 decided to have lost just as much as 50% with their sales. This case also discusses pros and cons of deal farming which on one part ensures farmers of price for their crop and understanding of fertilizers and seed but on other aspect has some evident downsides like monopoly of big stores. As a large market where arranged sector is poised to grow with 25% - 30% annually our administration must include appropriate regulations to save small merchants and our agricultural sector.
BACKGROUND OF RETAIL
India is a land of retail democracy- thousands of every week haats and bazaars are located across the period and breadth in our country by people's own self-organizational capacities. Our streets are bazaars - energetic, attractive, safe and the source of livelihood for millions. India has the highest shop density on the globe, with 11 retailers per 1000 people. This does not include the town haats. Our retail democracy is characterized by:
1. High levels of livelihoods in retail with almost 40 million employed which accounts for 8% of the job and 4% of the whole population.
2. High degrees of self - group.
3. Low capital input
4. High levels of decentralization
Retail in India has started with the concept of weekly markets, where all the stock traders gather at one big spot to sell their products every week. People come to these weekly markets to choose the household items for another one week. Village fairs and melas were also common as it got more of an entertainment value. After the people started getting active with their lives so when they turned entrepreneurial, there surfaced mother and pop outlets and the kiranas in the neighbourhood. After freedom, had become the system of Public distribution of foods through the ration outlets, where food grains, glucose and petrol for the daily usage were allocated at subsidized rates through the government ration shops. The present day corporate retail formats are of the exclusive brand outlets, hypermarkets and supermarkets, departmental stores and stores. But nonetheless the Indian consumer is determined by the self-organized retail shops for his or her daily needs. This is largely because of the excellent food retailing system that was established by the kiranas (mother and-pop) stores that continue meet with all certain requirements of retail requirements albeit without the convenience of the shopping as provided by the retail chains. The Hawkers/lari galla vendors and the local kiranas will be the two main types of unorganized retail in the united states, which almost account for 97% of the total retail trade. Big corporations like Wal-Mart and Reliance have began to try and take over the Indian retail sector. The value of the retail market is estimated at around $ 270 billion with a rise rate of 5. 7 % per annum in line with the Indian retail survey. How big is small retail is big, how big is big retail is small, a mere Rs. 250 billion in 2004 or 3% and Rs. 485 billion or 4. 7% % of the retail market in 2006. However, the top scale corporate retail is projected to develop at the rate of 28% to 30% per annum, reaching Rs. 1000 billion or $ 70 billion by 2010 from the existing size folks $ 8. 7 billion. The tenfold increase in commercial retail will be at the price tag on small range retail, which uses almost 10% of India's population. The strategy here is to define the small scale self-organized retail as "unorganized" and the top scale commercial retail as "organized". The real difference is however not unorganized vs planned. Nonetheless it is "self-organized vs. commercial"
Reliance Fresh is the convenience store format which forms area of the retail business of Reliance Business of India which is going by Mukesh Ambani. Reliance programs to purchase excess of Rs 25000 crores within the next 4 years in their retail section. The business already has in excess of 560 reliance fresh outlet stores across the country. These stores sell fresh fruits and vegetables, staples, groceries, fresh drink bars and dairy products.
A typical Reliance Fresh store is around 3000-4000 square. ft and caters to a catchment part of 2-3 kilometres.
History
Post launch, in a remarkable shift in its positioning and mainly due to the circumstances prevaling in UP, Western Bengal and Orissa, it was pointed out recently in news dailies that, Reliance Retail is moving out of stocking fruits and vegetables. Reliance Retail has made a decision to minimise its subjection in the super fruit and veg business and position Reliance Fresh as a 100 % pure play very market concentrating on categories like food, FMCG, home, consumer durables, IT and wellness, with food accounting for the bulk of the business enterprise.
The company might not exactly stock fruit and veggies in some claims. Though Reliance Fresh is not exiting the fruits and veg business altogether, it offers decided not to compete with local distributors partly anticipated to political reasons, and partly due to its inability to create a robust supply string. This is quite not the same as what the firm had originally designed.
When the first Reliance Fresh store opened up in Hyderabad last Oct, not only performed the company said the store's main target would be fresh produce like fruits & vegetables at a much lower price, but also spoke at duration about its "farm-to-fork'' theory. The theory the business spoke about was to source from farmers and sell right to the consumer taking away middlemen out of the way.
Reliance Fresh, Reliance Mart, Reliance Digital, Reliance Trendz, Reliance Footprint, Reliance Wellbeing, Reliance Jewels, Reliance Timeout and Reliance Super are various forms that Reliance has rolled out.
In addition, Reliance Retail has came into into an alliance with Apple for establishing a string of Apple Specialty Stores brand as iStore, starting with Bangalore.
CORPORATE Public RESPONSIBILITY
Today when almost all of the firms are busy in making profits at all, there are few Ones who are centered to come back this society, a part of what they have earned through this world. Reliance retail is one of them. Following work of reliance retail are aimed at benefiting the modern culture making reliance socially liable:
1) Reliance Retail is aimed at hiring people from the underprivileged community in
society. "Hence, we are planning to teach students from company schools and
schools run by NGOs. And, we think about this as part of our corporate social
responsibility, " he said. Asked whether the company will take students on an employment basis and pay them a stipend through the course period, he said that truly, it is planning to charge a "small cost" from those who want to become a member of the course "as we want to generate some self-discipline and regularity among the students", and will reimburse that after they are inducted into service.
2) Farming in India is highly fragmented and subject to harsh climatic conditions:
once harvested, it's very difficult to keep fruits & vegetables fresh. To secure
high quality, Reliance Retail is straight sourcing fresh agricultural produce from
thousands of farmers from villages through Collection Centers. With this concept, Reliance has generated a business model generating distributed value that links the business supply string more tightly to poor farmers in Indian villages. Reliance is providing a guaranteed market for the farmers' produce, lowering deal costs and training the farmers in better and ecological farming routines. This initiative leads to higher income and upgrading of skills for the farmers, and reduced spoilage of produce (up to 35 percent) and better quality products for Reliance retail stores.
3) Reliance retail has adopted "plantation to fork" theory this means it is procuring
Directly from the farmers thus offering them quite reasonable prices for their produce as now no intermediaries are involved. In return Reliance is providing farmers
information about how exactly can farmers enhance their productivity. They have got centers in villages who aside from providing information make farmers aware of market rates of different vegetation so that farmers can choose crops they would like to sow to become profitable. farmers are given technological help as well like information about quality of seeds and fertilizers.
Service marketing environment
Service marketing environment of reliance fresh can be scanned by taking into consideration the six major environment makes like demographic, economic, socio-culture, natural, technical, and political legal. As the demographic environment involves the age mix of population, literacy and education level. Financial level contains income distribution of differing people. The rich grew by 400% in cities and 200% in rural areas. Socio- ethnical environment consists of influence of religion, languages and customer that forms the ideals and attitudes of customer personal preferences, habits and behaviour.
Services Marketing and Marketing Mix
A service is the action of doing something for someone or something. It really is essentially intangible (i. e. not material). A product is tangible (i. e. materials) because you can touch it and bought it. A service is commonly an experience that is consumed at the main point where it is bought, and can't be had since is quickly perishes. A person could visit a caf 1 day and also have excellent service, and then come back the next day and have an unhealthy experience. So often marketers discuss the type of something as:
Inseparable - From the main point where it is used, and from the professional of the service. For example, you cannot have a live theater performance home to take it (a Movie of the same performance would be a product, not really a service).
Intangible - and cannot have a genuine, physical existence as does a product. For example, motor unit insurance may have a qualification, however the financial service itself cannot be handled i. e. it is intangible.
Perishable - for the reason that once it offers occurred it cannot be repeated in a similar way. For instance, once a 100 metres Olympic last has been run, you will see not other for 4 more years, and even then it'll be staged in a different place with many different finalists.
Variability- since the human participation of service provision means that no two services will be completely identical. For example, returning to the same car port time and time again for something on your car might see different levels of client satisfaction, or speediness of work.
Right of ownership - is not taken up to the service, because you just experience it. For example, an engineer may service your air-conditioning, nevertheless, you do not own the service, the engineer or his equipment. You cannot sell it on once it's been consumed, , nor take ownership than it.
Western economies have seen deterioration in their traditional manufacturing industries, and a rise in their service economies. Which means marketing blend has seen an expansion and adaptation in to the extended marketing combination for services, also known as the 7P's - physical information, process and people.
Reliance Fresh Marketing Mixture (7 P's)
After segmenting the market, finding the focus on segment and positioning itself, each company must come up with an offer. The 7 P's utilized by Reliance Fresh are:
1. Product
2. Place
3. Price
4. Promotion
5. People
6. Physical Evidence
7. Process
Target Segment what's Reliance fresh for me?
A Family with children, a purchase spot to be for the kids.
Urban customer on the road Great preference, quick service without impacting on the work program. But keep it affordable.
Product:
How should the company design, manufacture the product so that it
enhances the customer experience?
Product is the physical service or product offered to the consumer. Product includes certain aspects such as product packaging, guarantee, looks etc. This consists of both the tangible and the non tangible aspects of the product and service.
Reliance fresh has intentionally kept its product depth and product width limited. Reliance Fresh analyzed the behaviour of the Indian customer and provided a completely different menu when compared with its International offering. India is the sole country where reliance Fresh serve vegetarian. Even the sauces and cheese found in India are 100% vegetarian.
Place:
Where ought to be the product be available and the role of distribution
channels?
The place mainly contains the distribution stations. It is important so that the product is open to the customer at the right place, at the right time and in the right variety. Nearly 50% of U. S. A is at a 3 minute drive from a Reliance Fresh shop. There is a certain degree of fun and delight that a customer feels every time he dines at. There are certain value propositions that reliance fresh offer to its customers based on their needs. Reliance fresh offers hygienic environment, good ambience and great service. Now Reliance Fresh also have started offering internet center at their centres and they have been participating in music through radio rather than the standard music. There are certain dedicated areas for children where they can play while their parents can have some quality time collectively.
Price:
What should be the rates strategy?
Pricing includes the list price, the discount functions available, the funding options
available etc. It should also take into the consideration the probable response from the
competitor to the costs strategy. This is the most important part of the marketing blend as this is the only part which produces revenue. The rest of the three are bills incurred. The purchase price must take into consideration the correct demand-supply formula. Reliance fresh developed a very catchy punch line "Progress Through Value Creation". This was to attract the center and lower class consumers and the effect can clearly be seen in the consumer foundation Reliance fresh has now.
Promotion:
What is the suitable strategy and stations for campaign of the
product?
The various advertising channels being utilized Reliance fresh to effectively speak the merchandise information receive above. A specific understanding of the client value helps decide whether the cost of promotion will probably be worth spending.
There are three main aims of advertising for Reliance fresh are to make people alert to something, feel positive about it and remember it. The proper message has to be communicated to the right audience through the right press. Reliance fresh will its advertising through tv, hoardings and bus shelters. They use print out advertising and the television programs are also an important marketing medium for advertising. A few of the most famous marketing campaigns of Reliance fresh are:
· "Food and Fun"
People:
How to converge the great things about internal and external marketing?
Reliance fresh recognizes the worthiness of both its employees and its own customers. It recognizes the fact a happy worker can provide well and cause a happy customer. Reliance fresh continuously will Internal Marketing. This is important as it must precede external marketing. This consists of employing, training and motivating able employees. In this manner they serve customers well and the ultimate final result is a happy customer. The level of importance has changed to maintain the following order (the more important people are at the very best):
1. Customers
2. Front brand employees
3. Midsection level managers
4. Front brand managers
Physical evidences
-Actual Experiferal evidence
-A good time accessibility.
-Sign boards.
-Essential eminence of service.
-Good auto parking place
Process
Process Exist are complicated on railways like some processes are:
-refund process / case process.
-Communication process.
-Entraining/Detraining Process.
The service segmentation
Reliance Fresh has segmented their service to all class of men and women like abundant, poor by providing standards of service in different ways, for example - you can find different items/buget packs for these people they are the service segmentation of Reliance Fresh by which they are offering different categories of people. In every these service segmentation Reliance Fresh offers different facilities and charging same money.
'Items at a Glance' timetable, I've always used these on scheduling and have never had issues, write the abbreviation where you want to get, next to the term on the purchase form.
Organizations are taking an interest in the international marketing of services because of low cost factors and the ability to compete in near by country marketplaces (Bradley 1995); however, international
services present special challenges for marketing professionals because of this of the intangibility of services, the degree of customization, and variations in tastes across cultures. Research on international service offerings has centered on entry-mode alternatives technology growth, geographic functions, service influences on national competitive gain and strategic distinctions across services. The marketing literature has not investigated several key the different parts of service strategy, specifically in the international area.
Customers Requirements and Customer Expectations
Customers Experience after visiting the store can be reported to be not much acceptable. After this complete buzz it seemed to be a wet squib if you ask me.
1. Choice and Range. Reliance Retail is mostly a super market store. So, one needs a variety of goods available across various categories, brands and price ranges. Hardly there exists any range available. Not even, any categories of goods. Just a few we can easily live without.
2. Super Markets like Nilgiris, Trinethra (recently bought by Birlas), Subhikhsa, and Modern Market especially the last one has a superb range and Reliance Fresh is nowhere compared to them.
3. The Mood in the shop is good, but as I said nothing at all much different from the other excellent market chains.
4. The personnel is cordial and friendly very much eagerly looking forward to help. WHEN I made the payment, the personnel greeting me by expressing a Namaste. This I liked a great deal. Especially after unpleasant experiences of going to retailers in Kolkata. I really do not know why but shop keepers in Sodium Lake have this inclination of looking at you as if why do these customers keep bothering us, when u goes to them.
5. They allow card repayment even for repayments less than a hundred rupees.
6. They may have this membership card option with a free insurance tossed in, just to make certain you show loyalty to them.
As each goes through the reviews by the associates, they observe that the same items they may have quoted above are bothering them too. Even more reading, surfing and research made me understand some of the aspects related to it, which I want to share with you.
1. Customer is the last person in the imagination of these supermarket chains. Though it could be surprising, that's the fact straightly put. What matters the most is the quantity. The more the amount of stores opened, the greater is the number of people browsing them, the greater the probability of success.
2. The percentage they get for reselling a product. They are least bothered about providing a range of goods and brands to the client. In contrary, the firms that pay them the best commission reach sell their goods from them. When they have the statistics, companies cannot manage to disregard them courtesy, the large number of customers going to them. But why will be the Customers visiting them, when they aren't getting what they want?
3. The feel great factor. The goods we buy here can be easily bought at any other grocery store round the place. Then why do we flock to them? Because, we feel good. We feel happy learning to be a part of another India, which appears great much unlike the India we have harvested in. We love the atmosphere. We like being greeted.
4. By causing a right balance between the volumes and the feel good factor, they achieve their targets some times much beyond the objectives they have established. We live just part of the market grind that is happening right now!
Service restoration strategies
-Improving the after sales services.
-Admit and apologies.
-rectification of any error
-Compensate
-Minor performance lapse need monitoring
Quality concern
Quality means seeing the assistance from customer prospective.
The main quality matter of Reliance Fresh is:
To provide hygienic condition inside the stores.
Avoiding whenever you can the delay in the agenda.
Freshness is also one of the concern for Reliance fresh.
Improving the infrastructure to world class level of specifications.
Integrated gap model of service quality
Revenue%
The central emphasis of difference model is the customer distance, the difference between customer expectations and perceptions.
GAP-1 Not knowing what customer expect i. e. what are the expectation of customer of Reliance Fresh which may be due to limited marketing research.
GAP-2 Not selecting the right service design and benchmarks. Reliance Fresh have a good service design but not reached to that level of criteria to meet all customer prospects.
GAP-3 Not delivering to service designs and specifications. This can be due to scarcity of human resource insurance plan of Reliance Fresh. And may be anticipated to failure in meeting source and demand. Because of the huge society of India.
GAP-4 Not corresponding performance to claims. This is due to lack of integrating services marketing communication and ineffective management of customer expectation by Reliance Fresh.
In this way the difference between expected quality and recognized quality can be determined by Reliance Fresh.
Blueprint of Reliance Fresh (near Patel chowk)
Entering path
Tracks for sale of googd
Tracks for purchase of googd
Billing counter
Gate keeper
Entrance to Reliance Fresh
This is the blueprint of reliance fresh. Customer when comes to this store first of all the gate keeper will check it and keep the tote if he has with him. The billing counter is first right of access. When customer enters it the paths whether for witnessing of goods and if he liked something than he can said in trolley and then he can go the billing counter-top. If he needs some help than he also can require it but showing the nearest salesman. After selecting the good he is able to go to billing and get back to gate keeper. Gate keeper now demand for the receipt for just the security purpose.
Pricing Strategies by Reliance Fresh
-Discount costs strategy
-Wide cost range of every items
-Credit cards acceptance
-Accept coupons
- Competitive prices.
-Price marked in paisa's
-comparable cost.
