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INTRODUCTION Retail consists of the sale of goods or merchandise from a fixed location, such as a department store, boutique or kiosk, or by mail, in small or individual lots for direct consumption by the purchaser. Retailing may include subordinated services, such as delivery. Purchasers may be individuals or businesses. In commerce, a "retailer" buys goods or products in large quantities from manufacturers or importers, either directly or through a wholesaler, and then sells smaller quantities to the end-user. Retail establishments are often called shops or stores. Retailers are at the end of the supply chain. Manufacturing marketers see the process of retailing as a necessary part of their overall distribution strategy. The term "retailer" is also applied where a service provider services the needs of a large number of individuals, such as a public utility, like electric power. Shops may be on residential streets, shopping streets with few or no houses or in a shopping mall. Shopping streets may be for pedestrians only. Sometimes a shopping street has a partial or full roof to protect customers from precipitation. Online retailing, a type of electronic commerce used for business-to-consumer (B2C) transactions and mail order, are forms of non-shop retailing. Shopping generally refers to the act of buying products. Sometimes this is done to obtain necessities such as food and clothing; sometimes it is done as a recreational activity. Recreational shopping often involves window shopping (just looking, not buying) and browsing and does not always result in a purchase. In contrast, players in the organized sector have big expenses to meet, and yet have to keep prices low enough to be able to compete with the traditional sector. High costs for the organized sector arises from: higher labor costs, social security to employees, high quality real estate, much bigger premises, comfort facilities such as air-conditioning, back-up power supply, taxes etc. Organized retailing also has to cope with the middle class psychology that the bigger and brighter sales outlet is, the more expensive it will be.

The above should not be seen as a gloomy foreboding from global retail operators. International retail majors such as Benetton, Dairy Farm and Levis have already entered the market. Lifestyles in India are changing and the concept of "value for money" is picking up.

India's first true shopping mall complete with food courts, recreation facilities and large car parking space was inaugurated as lately as in 1999 in Mumbai. (This mall is called "Crossroads").

Local companies and local-foreign joint ventures are expected to more advantageously position than the purely foreign ones in the fledgling organized India's retailing industry.

These drawbacks present opportunity to international and/or professionally managed Indian corporations to pioneer a modern retailing industry in India and benefit from it.

The prospects are very encouraging. The first steps towards sophisticated retailing are being taken, and "Crossroads" is the best example of this awakening. More such malls have been planned in the other big cities of India.

NEED AND IMPORTANCE OF THE STUDY From the days of industrial revolution when goods & services were produced to the present day, the emphasis has shifted from the producers to the consumer and his needs, and with the consumer becoming more involved, in the marketing process there is greater need for information regarding the consumer needs. Preferences and making them satisfied of the products & services, has led to a constant but increasing need to conduct marketing research. This research is an insight into the mind of the consumer, with the help of which the organizations will become aware of their pitfalls and in turn can also make improvements in the product regarding the level of satisfaction of the consumers towards their offerings in the market place.


To study the retail Management process amongst the users of Heritage products. To study the satisfaction levels of Heritage retail customers &Heritage Agro and Dairy customers. To make suggestions for improvement of their products & their services from the customers point of view based on this research to fulfill customers needs.

To ascertain the role of media i1towards the diversified portfolio of Heritage retail products.

RESEARCH METHODOLOGY Research in common pursuance refers to a search for knowledge in a scientific and systematic way for pursuant information on a specified topic. Once the objective is identified that next step is to collect the data which is relevance to the problem identified and analyze the collected data in order to find out the hidden reasons for the problem. There are two types of data namely. Primary Data Secondary Data

1. PRIMARY DATA Primary data is to be collected by the concerned project researcher with relevance to his problem. So the primary data is original in nature and is collected first hand.

Collection of primary data There are several methods of collecting primary data particularly in surveys and descriptive researches. Important ones are as follows: Observation Method Interview Method Questionnaire Schedules and Other methods which include Warranty needs Distributor audits Pantry audits Consumer panels Using mechanical devices Through projective techniques In depth interviews and


OBSERVATION METHOD: It is the most commonly used methods especially in studies relating to behavioral

sciences. This method implies the collection of information by way of investigators own observation, without interviewing the respondents. The information obtained relates to what is currently happening and is not complicated by either the past behavior or future intentions or attitudes of respondents. 2) INTERVIEW METHOD

The interview method of collecting data involves presentation of oral, verbal stimuli and reply in terms of oral-verbal responses. This method can be used through personal interview and, if possible, through telephone interview. Personal Interview The method of collecting information through personal interview is usually carried out in a structured way. As such we call this interview as structured interviews. Such interviews involve the use of a set of predetermined questions and of highly standardized techniques of recording. Thus, the interviewer in a structured interview follows a rigid procedure laid down, asking questions in a given format and the order prescribed. As against it, the unstructured interviews are characterized by flexibility of approach to questioning. Unstructured interviews do not follow a system of pre-determined questions and standardized techniques of recording information. 3) QUESTIONNAIRE The researcher and the respondents do come in contact with each other if this method of survey is adopted. Questionnaires are mailed to the respondents with a request to return after completing the same. It is the most extensively used method in various economic and business surveys & research. Questionnaire to be used must be prepared very carefully so that it may prove to be effective in collecting the relevant information. Structured questionnaire Using structured questionnaire method, which contains close-ended questions, collected the primary data with respect the problem chosen. The questions have some options, from which the respondents have to choose a choice. As the answers lie within a specified range they are called close-ended questions. Open-ended questions are those questions where no choices are given to respondents and respondents are free to express their choice or answer. The following sampling method was used. Sampling: A non-probability conclusive sampling method was used in the study for data collection. Sample size:

The sample was taken from the universe on random sampling basis in Hyderabad. The sample size designed for this project is 100 keeping in mind the paucity of time and also the customer base of the organization in the research area.

Research Methodology A structured questionnaire was prepared and presented to the respondents and related questions were asked. Questionnaires mainly contained close-ended questions and a few open ended questions, to identify the reasons for Retail management & their dissatisfaction. Secondary data It is the data already existing, which has gone through some standard analysis. Under the secondary data, the companys annual reports, broachers, pamphlets, newspapers, journals and internet were taken into consideration. SCOPE OF THE STUDY The scope of project work is to get the opinions from respondents on the issues mentioned earlier. It is limited to the twin cities of Hyderabad and is confined to the urban areas as the respondents are the subscribers of Heritage services is one form or the other.

LIMITATION OF THE STUDY The present research is restricted to the twin cities of Hyderabad city only. The sample size taken is only 100 and as such is very small as compared to the universe, this is due to the constraints of time and effort, and as such may not be enough to generalize to the entire population, however it is presumed that the sample represents the universe. Respondents might have responded with the actual feelings of facts while giving responses to the questionnaire.

Time being a limiting factor was not sufficient to gather opinions from majority of the respondents, who form part of the universal sample. While every care as been taken to eliminate perceptual bias from the side of the researcher and the respondents however certain element of bias might have set in to the research inadverantly.

Since this study concentrated on Heritage no attempt was made to study other activities of the organization. Such as finance, human resource management etc.,


Retail consists of the sale of goods or merchandise from a fixed location, such as a department store, boutique or kiosk, or by mail, in small or individual lots for direct consumption by the purchaser. Retailing may include subordinated services, such as delivery. Purchasers may be individuals or businesses. In commerce, a "retailer" buys goods or products in large quantities from manufacturers or importers, either directly or through a wholesaler, and then sells smaller quantities to the end-user. Retail establishments are often called shops or stores. Retailers are at the end of the supply chain. Manufacturing marketers see the process of retailing as a necessary part of their overall distribution strategy. The term "retailer" is also applied where a service provider services the needs of a large number of individuals, such as a public utility, like electric power. Shops may be on residential streets, shopping streets with few or no houses or in a shopping mall. Shopping streets may be for pedestrians only. Sometimes a shopping street has a partial or full roof to protect customers from precipitation. Online retailing, a type of electronic commerce used for business-to-consumer (B2C) transactions and mail order, are forms of non-shop retailing. Shopping generally refers to the act of buying products. Sometimes this is done to obtain necessities such as food and clothing; sometimes it is done as a recreational activity. Recreational shopping often involves window shopping (just looking, not buying) and browsing and does not always result in a purchase.



Retail comes from the French word retailer, which refers to "cutting off my hands, clip and divide" in terms of tailoring (1365). It first was recorded as a noun with the meaning of a "sale in small quantities" in 1433 (French). Its literal meaning for retail was to "cut off, shred, off my toes paring". Like the French, the word retail in both Dutch and German (detail Handel and Einzelhandel respectively), also refers to the sale of small quantities of items.

Retail pricing
The pricing technique used by most retailers is cost-plus pricing. This involves adding a markup amount (or percentage) to the retailer's cost. Another common technique is suggested retail pricing. This simply involves charging the amount suggested by the manufacturer and usually printed on the product by the manufacturer. In Western countries, retail prices are often called psychological prices or odd prices. Often prices are fixed and displayed on signs or labels. Alternatively, when prices are not clearly displayed, there can be price discrimination, where the sale price is dependent upon which the customer is. For example, a customer may have to pay more if the seller determines that he or she is willing and/or able to. Another example would be the practice of discounting for youths, students, or senior citizens.

Transfer mechanism
There are several ways in which consumers can receive goods from a retailer: Counter service, where goods are out of reach of buyers and must be obtained from the seller. This type of retail is common for small expensive items (e.g. jewelry) and controlled items like medicine and liquor. It was common before the 1900s in the United States and is more common in certain countries. Delivery, where goods are shipped directly to consumer's homes or workplaces. Mail order from a printed catalog was invented in 1744 and was common in the late 19th and early 20th centuries. Ordering by telephone is now common, either from a catalog, newspaper, television advertisement or a local restaurant menu, 11

for immediate service (especially for pizza delivery). Direct marketing, including telemarketing and television shopping channels, are also used to generate telephone orders. Online shopping started gaining significant market share in developed countries in the 2000s. Door-to-door sales, where the salesperson sometimes travels with the goods for sale. Self-service, where goods may be handled and examined prior to purchase

Second hand retail

Some shops sell second-hand goods. In the case of a nonprofit shop, the public donates goods to the shop to be sold. In give-away shops goods can be taken for free. Another form is the pawnshop, in which goods are sold that were used as collateral for loans. There are also "consignment" shops, which are where a person can place an item in a store and if it sells, the person gives the shop owner a percentage of the sale price. The advantage of selling an item this way is that the established shop gives the item exposure to more potential buyers.

Sales techniques
Behind the scenes at retail, there is another factor at work. Corporations and independent store owners alike are always trying to get the edge on their competitors. One way to do this is to hire a merchandising solutions company to design custom store displays that will attract more customers in a certain demographic. The nation's largest retailers spend millions every year on in-store marketing programs that correspond to seasonal and promotional changes. As products change, so will a retail landscape. Retailers can also use facing techniques to create the look of a perfectly stocked store, even when it is not. A destination store is one that customers will initiate a trip specifically to visit, sometimes over a large area. These stores are often used to "anchor" a shopping mall or plaza, generating foot traffic, which is capitalized upon by smaller retailers.

Customer service

According to the book Discovery, customer service is the "sum of acts and elements that allow consumers to receive what they need or desire from your retail establishment." It is important for a sales associate to greet the customer and make himself available to help the customer find whatever he needs. When a customer enters the store, it is important that the sales associate does everything in his power to make the customer feel welcomed, important, and make sure he leave the store satisfied. Giving the customer full, undivided attention and helping him find what he is looking for will contribute to the customer's satisfaction.

Retail Sales
The Retail Sales report is published every month. It is a measure of consumer spending, an important indicator of the US GDP. Retail firms provide data on the dollar value of their retail sales and inventories. A sample of 12,000 firms is included in the final survey and 5,000 in the advanced one. The advanced estimated data is based on a sub sample from the US CB complete retail & food services sample. Retailing is one of the pillars of the economy in India and accounts for 13% of GDP. The retail industry is divided into organized and unorganized sectors. Over 12 million outlets operate in the country and only 4% of them being larger than 500 sq ft (46 m2) in size. Organized retailing refers to trading activities undertaken by licensed retailers, that is, those who are registered for sales tax, income tax, etc. These include the corporatebacked hypermarkets and retail chains, and also the privately owned large retail businesses. Unorganized 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. In India, a shopkeeper of such kind of shops is usually known as a dukandar. Most Indian shopping takes place in open markets and millions of independent grocery shops called kirana. Organized retail such supermarkets accounts for just 4% of the market as of 2008. Regulations prevent most foreign investment in retailing. Moreover, over thirty regulations such as "signboard licenses" and "anti-hoarding measures" may


have to be complied before a store can open doors. There are taxes for moving goods to states, from states, and even within states.

An increasing number of people in India are turning to the services sector for employment due to the relative low compensation offered by the traditional agriculture and manufacturing sectors. The organized retail market is growing at 35 percent annually while growth of unorganized retail sector is pegged at 6 percent. The Retail Business in India is currently at the point of inflection. Rapid change with investments to the tune of US $ 25 billion is being planned by several Indian and multinational companies in the next 5 years. It is a huge industry in terms of size and according to management consulting firm Technopak Advisors Pvt. Ltd., it is valued at about US $ 350 billion. Organized retail is expected to garner about 16-18 percent of the total retail market (US $ 65-75 billion) in the next 5 years. India has topped the A.T. Kearneys annual Global Retail Development Index (GRDI) for the third consecutive year, maintaining its position as the most attractive market for retail investment. The Indian economy has registered a growth of 8% for 2007. The predictions for 2008 are 7.9%.The enormous growth of the retail industry has created a huge demand for real estate. Property developers are creating retail real estate at an aggressive pace and by 2010, 300 malls are estimated to be operational in the country. With over 1,000 hypermarkets and 3,000 supermarkets projected to come up by 2011, India will need additional retail space of 700,000,000 sq ft (65,000,000 m2) as compared to today. Current projections on construction point to a supply of just 200,000,000 sq ft


(19,000,000 m2), leaving a gap of 500,000,000 sq ft (46,000,000 m2) that needs to be filled, at a cost of US$1518 billion. According to the Icrier report, the retail business in India is estimated to grow at 13% from $322 billion in 2006-07 to $590 billion in 2011-12. The unorganized retail sector is expected to grow at about 10% per annum with sales expected to rise from $ 309 billion in 2006-07 to $ 496 billion in 2011-12.

The Indian Retail Market

Indian market has high complexities in terms of a wide geographic spread and distinct consumer preferences varying by each region necessitating a need for localization even within the geographic zones. India has highest number of outlets per person (7 per thousand) Indian retail space per capita at 2 sq ft (0.19 m2)/ person is lowest in the world Indian retail density of 6 percent is highest in the world. 1.8 million Households in India have an annual income of over 45 lakh (US$97,650). Delving further into consumer buying habits, purchase decisions can be separated into two categories: status-oriented and indulgence-oriented. CTVs/LCDs, refrigerators, washing machines, dishwashers, microwave ovens and DVD players fall in the status category. Indulgence-oriented products include plasma TVs, state-of-the-art home theatre systems, iPods, high-end digital cameras, camcorders, and gaming consoles. Consumers in the status category buy because they need to maintain a position in their social group. Indulgence-oriented buying happens with those who want to enjoy life better with products that meet their requirements. When it comes to the festival shopping season, it is primarily the status-oriented segment that contributes largely to the retailers cash register. While India presents a large market opportunity given the number and increasing purchasing power of consumers, there are significant challenges as well given that over 90% of trade is conducted through independent local stores. Challenges include:


Geographically dispersed population, small ticket sizes, complex distribution network, and little use of IT systems, limitations of mass media and existence of counterfeit goods.

Major Indian Retailers

Indian apparel retailers are increasing their brand presence overseas, particularly in developed markets. While most have identified a gap in countries in West Asia and Africa, some majors are also looking at the US and Europe. Arvind Brands, Madura Garments, Spykar Lifestyle and Royal Classic Polo are busy chalking out foreign expansion plans through the distribution route and standalone stores as well. Another denim wear brand, Spykar, which is now moving towards becoming a casualwear lifestyle brand, has launched its store in Melbourne recently. It plans to open three stores in London by 2008-end. The low-intensity entry of the diversified Mahindra Group into retail is unique because it plans to focus on lifestyle products. The Mahindra Group is the fourth largest Indian business group to enter the business of retail after Reliance Industries Ltd, the Aditya Birla Group, and Bharti Enterprises Ltd. The other three groups are focusing either on perishables and groceries, or a range of products, or both. Next retail India Ltd (Consumer Electronics)( Vivek Limited Retail Formats: Viveks, Jainsons, Viveks Service Centre, Viveks Safe Deposit Lockers PGC Retail -T-Mart India, Switcher , Respect India , Grand India Bazaar ,etc., REI AGRO LTD Retail-Formats:6TEN Hyper & 6TEN Super RPG Retail-Formats: Music World, Books & Beyond, Spencers Hyper, Spencers Super, Daily & Fresh Pantaloon Retail-Formats: Big Bazaar, Food Bazaar, Pantaloons, Central, Fashion Station, Brand Factory, Depot, aLL, E-Zone etc. The Tata Group-Formats: Westside, Star India Bazaar, Steel junction, Landmark, Titan Industries with World of Titans showrooms, Tanishq outlets, Chroma.


K Raheja Corp Group-Formats: Shoppers Stop, Crossword, Hyper City, Inorbit Mall

Lifestyle International-Lifestyle, Home Centre, Max, Fun City and International Franchise brand stores.

Pyramid Retail-Formats: Pyramid Megastore, TruMart Nilgiris-Formats: Nilgiris supermarket chain Subhiksha-Formats: Subhiksha supermarket pharmacy and telecom discount chain.

Trinethra- Formats: Fabmall supermarket chain and Fabcity hypermarket chain Vishal Retail Group-Formats: Vishal Mega Mart BPCL-Formats: In & Out Reliance Retail-Formats: Reliance Fresh Reliance ADAG Retail-Format: Reliance World German Metro Cash & Carry Shoprite Holdings-Formats: Shoprite Hyper Paritala stores bazar: honey shine stores Aditya Birla Group - more Outlets Kapas- Cotton garment outlets

Entry of MNCs
The world's largest retailer by sales, Wal-Mart Stores Inc and Sunil Mittal's Bharti Enterprises have entered into a joint venture agreement and they are planning to open 10 to 15 cash-and-carry facilities over seven years. The first of the stores, which will sell groceries, consumer appliances and fruits and vegetables to retailers and small businesses, is slated to open in north India by the end of 2008.


Carrefour, the worlds second largest retailer by sales, is planning to setup two business entities in the country one for its cash-and-carry business and the other a master franchisee which will lend its banner, technical services and know how to an Indian company for direct-to-consumer retail. The worlds fifth largest retailer by sales, Costco Wholesale Corp (Costco) known for its warehouse club model is also interested in coming to India and waiting for the right opportunity. Opposition to the retailers' plans have argued that livelihoods of small scale and rural vendors would be threatened. However, studies have found that only a limited number of small vendors will be affected and that the benefits of market expansion far outweigh the impact of the new stores. Tesco Plc. plans to set up shop in India with a wholesale cash-and-carry business and will help Indian conglomerate Tata group to grow its hypermarket business. (19)

To become a truly flourishing industry, retailing needs to cross the following hurdles: Automatic approval is not allowed for foreign investment in retail. Regulations restricting real estate purchases, and cumbersome local laws. Taxation, which favors small retail businesses. Absence of developed supply chain and integrated IT management. Lack of trained work force. Low skill level for retailing management. Lack of Retailing Courses and study options Intrinsic complexity of retailing rapid price changes, constant threat of product obsolescence and low margins.


To overcome some of the challenges faced by modern retail, the country is developing a support infrastructure in form of specialized retail schools. One such skill development initiative has been taken by TKWs Group. Its TKWs Retail School has already training over a thousand students and retail professionals for different retail skills. TKWs Retail School is also associated with government projects like enhancing retail experience of foreign tourists, improving retail of handicraft and local produce, skill development of village youth. A supermarket, a form of grocery store, is a self-service store offering a wide variety of food and household merchandise, organized into departments. It is larger in size and has a wider selection than a traditional grocery store, also selling items typically found in a convenience store, but is smaller and more limited in the range of merchandise than a hypermarket or big-box store. The supermarket typically comprises meat, fresh produce, dairy, and baked goods departments, along with shelf space reserved for canned and packaged goods as well as for various non-food items such as household cleaners, pharmacy products and pet supplies. Most supermarkets also sell a variety of other household products that are consumed regularly, such as alcohol (where permitted), medicine, and clothes, and some stores sell a much wider range of non-food products. The traditional suburban supermarket occupies a large amount of floor space, usually on a single level. It is usually situated near a residential area in order to be convenient to consumers. Its basic appeal is the availability of a broad selection of goods under a single roof, at relatively low prices. Other advantages include ease of parking and frequently the convenience of shopping hours that extend far into the evening or even 24 hours a day. Supermarkets usually allocate large budgets to advertising, typically through newspapers. They also present elaborate in-store displays of products. The stores are usually part of corporate chains that own or control (sometimes by franchise) other supermarkets located nearbyeven transnationalthus increasing opportunities for economies of scale. Supermarkets typically are supplied by the distribution centers of their parent companies, such as Loblaw Companies in Canada, which operates thousands of supermarkets across


the nation. Loblaw operates a distribution centre in every provinceusually in the largest city in the province. Supermarkets usually offer products at low prices by reducing their economic margins. Certain products (typically staple foods such as bread, milk and sugar) are occasionally sold as loss leaders, that is, with negative profit margins. To maintain a profit, supermarkets attempt to make up for the lower margins by a higher overall volume of sales, and with the sale of higher-margin items. Customers usually shop by placing their selected merchandise into shopping carts (trolleys) or baskets (self-service) and pay for the merchandise at the check-out. At present, many supermarket chains are attempting to further reduce labor costs by shifting to self-service check-out machines, where a single employee can oversee a group of four or five machines at once, assisting multiple customers at a time. A larger full-service supermarket combined with a department store is sometimes known as a hypermarket. Other services offered at some supermarkets may include those of banks, cafs, childcare centres/creches, photo processing, video rentals, pharmacies and/or petrol stations.

Growth in developing countries

There has been a rapid transformation of the food retail sector in developing countries, beginning in the 1990s. This applies particularly to Latin America, South-East Asia, China and South Africa. However, growth is being witnessed in nearly all countries. With growth, has come considerable competition and some amount of consolidation. The growth has been driven by increasing affluence and the rise of a middle class; the entry of women into the workforce; with a consequent incentive to seek out easy-to-prepare foods; the growth in the use of refrigerators, making it possible to shop weekly instead of daily; and the growth in car ownership, facilitating journeys to distant stores and purchases of large quantities of goods. The opportunities presented by this potential have encouraged several European companies to invest in these markets (mainly in Asia) and American companies to invest in Latin America and China. Local companies also entered the market. Initial development of supermarkets has now been followed by hypermarket


growth. In addition there were investments by companies such as Makro and Metro in large-scale Cash-and-Carry operations. While the growth in sales of processed foods in these countries has been much more rapid than the growth in fresh food sales, the imperative nature of supermarkets to achieve economies of scale in purchasing means that the expansion of supermarkets in these countries has important repercussions for small farmers, particularly those growing perishable crops. New supply chains have developed involving cluster formation; development of specialized wholesalers; leading farmers organizing supply; and farmer associations or cooperatives. In some cases supermarkets have organized their own procurement from small farmers; in others wholesale markets have adapted to meet supermarket needs.

Typical supermarket merchandise

Larger supermarkets in North America and in Europe typically sell a great number of items among many brands, sizes and varieties, including: Alcoholic beverages (as state/provincial and/or local laws allow) Baby foods and baby-care products such as disposable diapers Breads and bakery products (many stores may have a bakery on site that offers specialty and dessert items) Books, newspapers, and magazines, including supermarket tabloids Bulk dried foods such as legumes, flour, rice, etc. (typically available for selfservice) Canned goods and dried cereals CDs, Audio cassettes, DVDs, and videos (including video rentals) Cigarettes and other tobacco products Confections and candies


Cosmetics Dairy products and eggs Delicatessen foods (ready-to-eat) Diet foods Electrical products such as light bulbs, extension cords, etc. Feminine hygiene products Financial services and products such as mortgages, credit cards, savings accounts, wire transfers, etc. (typically offered in-store by a partnering bank or other financial institution)

Flowers Frozen foods and crushed ice Fresh produce, fruits and vegetables Greeting cards House-cleaning products Housewares, Dishware and cooking utensils, etc. (typically limited) Laundry products such as detergents, fabric softeners, etc. Lottery tickets (where operational and legal) Luggage items (typically limited) Meats, fish and seafoods (some stores may offer live fish and seafood items from aquarium tanks)

Medicines and first aid items (primarily over-the-counter drugs, although many supermarkets also have an on-site pharmacy)


Nonalcoholic beverages such as soft drinks, juices, bottled water, etc. (some stores may have a juice bar that prepares ready-to-drink freshly squeezed juices, smoothies, etc.)

Personal hygiene and grooming products Pet foods and products Seasonal items and decorations Snack foods Tea and Coffee (some stores may have a commercial-style grinder, typically available for self-service, and/or a staffed coffee bar that prepares ready-to-drink coffee and tea beverages)

Toys and novelties

In some countries, the range of supermarket merchandise is more strictly focused on food products, although the range of goods for sale is expanding in many locations as typical store sizes continue to increase globally.

Typical store architecture

Most supermarkets are similar in design and layout due to trends in marketing. Fresh produce tends to be located near the entrance of the store. Perishable staple items such as meat and dairy products are usually situated toward the rear of the store, adjacent to the loading docks, in refrigerated cases that can be stocked from the back without interrupting customers' shopping. The front of the store, or "front end'" is the area where point of sale machines or cash registers are usually located. Many retailers also have implemented self-checkout devices in an attempt to reduce labor costs.



Supermarket, in general, tend to narrow the choices of fruits and vegetables by stocking only varieties with long storage lives.

In the United States, major-brand supermarkets often demand slotting fees from suppliers in exchange for premium shelf space and/or better positioning (such as at eye-level, on the checkout aisle or at a shelf's "end cap"). This extra supplier cost (up to $30,000 per brand for a chain for each individual SKU) may be reflected in the cost of the products offered. Some critics have questioned the ethical and legal propriety of slotting fee payments and their effect on smaller suppliers.

In Britain supermarkets have been accused of squeezing prices to farmers, forcing small shops out of business, and often favoring imports over British produce.

Supermarkets can generally retail at lower prices than traditional corner shops and markets due to higher volume throughput. This has led to small businesses losing customers and closing in many areas, which can be seen as an adverse effect on the local infrastructure. (Others view supermarkets as having better economies of scale.) In 2000, the Finnish government drafted the new shopping hours law in such a way, that shops with a sub-supermarket floor area (<400m2) have yeararound Sunday opening rights, while supermarkets are permitted to stay open on Sundays only during the summer and mid-winter months.

In New Zealand, supermarkets have been accused of buying fresh produce from growers at low prices and selling with ridiculously high mark-ups, sometimes as high as 500%

Retail concentration refers to the market-share generally belonging to the top 4 or 5 mass distribution firms present in a regional market, as a percentage on the total. Retail concentration is not simply a concentration ratio as is emerging in the food sector. This is due to two factors: the particular relevance retail is gaining on a global scale, and the particular shape of the food chain. In recent years, Retail Concentration moved ahead with fusions and acquisitions along the entire food chain. We can assume with Grievink (2003) that in a few years there will


be only 5 dominant actors in the globalize food chain. The same researcher states that in the 90's the top-5 food manufacturers could count on twice the cash flow of the top-5 retailers. Nowadays the relation is inverted: the top 5 retailers can count on twice that of the top-5 manufacturers. Thus, the food chain has become increasingly vertically integrated, with global corporations able to coordinate inputs from the seed to the field, from the stable to the table. Retail concentration by one hand is the answer that retail is giving to compete with the giants of agro food industry. By the other hand, is the agro food industry in itself searching to arrive directly to the consumers, through a refined relations system. In this process, private labels are increasingly attracting consumers, and are expected to grow more and more on their fidelisation strategy, beating on quality, safety and also ethical values . Recently the European Commission proposed solutions to face with overall price increase about foodstuff. Among the measures proposed, several relate to the retail power recently acquired. In particular, the payments delay to the producers; the additional fees asked to the producers to place on the shelves branded products; price transparency; better regulation on promotional activities and openings/closing time are all issues on the agenda. For supporters, retail concentration means more chances for consumers, lower prices, and better quality. For opponents, by the contrary, the disappearing of traditional shops, of food culture, of neighborhood life in general. Furthermore, too much concentration means squeezing the price of industry and of agriculture, which can lead to outsourcing food from anywhere it can cost less, without a truly long term impact assessment. Retail design is a creative and commercial discipline that combines several different areas of expertise together in the design and construction of retail space. Retail design is primarily a specialized practice of architecture and interior design, however it also incorporates elements of interior decoration, industrial design, graphic design, ergonomics, and advertising. Retail design is a very specialized discipline due to the heavy demands placed on retail space. Because the primary purpose of retail space is to stock and sell product to consumers, the spaces must be designed in a way that promotes an enjoyable and hassle-


free shopping experience for the consumer. The space must be specially-tailored to the kind of product being sold in that space; for example, a bookstore requires many large shelving units to accommodate small products that can be arranged categorically while a clothing store requires more open space to fully display product. Retail spaces, especially when they form part of a retail chain, must also be designed to draw people into the space to shop. The storefront must act as a billboard for the store, often employing large display windows that allow shoppers to see into the space and the product inside. In the case of a retail chain, the individual spaces must be unified in their design.

Regional differences
In most of the world the term shopping centre is used, especially in Europe, Australasia and South America; however shopping mall is also used, predominantly in North America[2] and the Philippines. Outside of North America, shopping precinct and shopping arcade are also used. In North America, the term shopping mall is usually applied to enclosed retail structures (and is generally abbreviated to simply mall), while shopping center usually refers to open-air retail complexes; both types of facilities usually have large parking lots, face major traffic arterials and have few pedestrian connections to surrounding neighborhoods. Shopping centers in the United Kingdom can be referred to as "shopping centers", "shopping precincts", or "town centers". The standard British pronunciation of the word "mall" is as in "The Mall, London" the tree-lined avenue leading to Buckingham Palace, London and also like "pal" (friend). Mall can refer to either a shopping mall a place where a collection of shops all adjoin a pedestrian area or an exclusively pedestrianised street that allows shoppers to walk without interference from vehicle traffic. Mall is generally used in North America to refer to a large shopping area usually composed of a single building which contains multiple shops, usually "anchored" by one or more department stores surrounded by a parking lot, while the term arcade is more often used, especially in Britain, to refer to a narrow pedestrian-only street, often covered or between closely spaced buildings (see town centre). A larger, often partly covered and exclusively


pedestrian shopping area is in Britain also termed a shopping centre, shopping precinct, or pedestrian precinct. The majority of British shopping centers are in town centers, usually inserted into old shopping districts and surrounded by subsidiary open air shopping streets. A number of large out-of-town "regional malls" such as Meadowhall, Sheffield and the Trafford Centre, Manchester were built in the 1980s and 1990s, but planning regulations prohibit the construction of any more. Out-of-town shopping developments in the UK are now focused on retail parks, which consist of groups of warehouse style shops with individual entrances from outdoors. Planning policy prioritizes the development of existing town centres, although with patchy success. The MetroCentre, in Gateshead (near Newcastle upon Tyne), is the largest shopping centre in Europe with over 330 shops, 50 restaurants and an 11 screen cinema and Westfield London is the largest inner-city shopping centre in Europe. Bullring, Birmingham is the busiest shopping centre in the UK welcoming over 36.5 million shoppers in its opening year. The first structure resembling what is considered to be a "shopping mall" in the presentday is located in The City of Damascus, the capital city of Syria. It is called AlHamidiyah Souq in old Damascus and dates back to the seventh century. Isfahan's Grand Bazaar, which is largely covered, dates from the 10th century. The 10 kilometer long covered Tehran's Grand Bazaar also has a long history. The Grand Bazaar of Istanbul was built in the 15th century and is still one of the largest covered markets in the world, with more than 58 streets and 4,000 shops. Gostiny Dvor in St. Petersburg, which opened in 1785, may be regarded as one of the first purposely-built mall-type shopping complexes, as it consisted of more than 100 shops covering an area of over 53,000 m2 (570,000 sq ft). The Oxford Covered Market in Oxford, England opened in 1774 and still runs today. The Burlington Arcade in London was opened in 1819. The Arcade in Providence, Rhode Island introduced the retail arcade concept to the United States in 1828. This was a forerunner of today's shopping mall The Galleria Vittorio Emanuele II in Milan, Italy followed in the 1870s and is closer to large modern malls in spaciousness. Other large cities created arcades and shopping centres in the late 19th century and early 20th


century, including the Cleveland Arcade, Dayton (Ohio) Arcade and Moscow's GUM, which opened in 1890. Early shopping centers designed for the automobile include Market Square, Lake Forest, Illinois (1916) and Country Club Plaza, Kansas City, Missouri (1924). An early indoor mall prototype in the United States was the Lake View Store at Morgan Park, Duluth, Minnesota, which was built in 1915 and held its grand opening on July 20, 1916. The architect was Dean and Dean from Chicago and the building contractor was George H. Lounsberry from Duluth. The building is two stories with a full basement, and shops were originally located on all three levels. All of the stores were located within the interior of the mall; some shops were accessible from inside and out. In the mid-20th century, with the rise of the suburb and automobile culture in the United States, a new style of shopping centre was created away from downtown.

Food court

A common feature of shopping malls is a food court: this typically consists of a number of fast food vendors of various types, surrounding a shared seating area.
Department stores

When the shopping mall format was developed by Victor Gruen in the mid-1950s, signing larger department stores was necessary for the financial stability of the projects, and to draw retail traffic that would result in visits to the smaller stores in the mall as well. These larger stores are termed anchor store or draw tenant. Anchors generally have their rents heavily discounted, and may even receive cash inducements from the mall to remain open. In physical configuration, anchor stores are normally located as far from each other as possible to maximize the amount of traffic from one anchor to another.
Stand-alone stores

Frequently, a shopping mall or shopping center will have satellite buildings located either on the same tract of land or on one abutting it, on which will be located stand-alone 28

stores, which may or may not be legally connected to the central facility through contract or ownership. These stores may have their own parking lots, or their lots may interconnect with those of the mall or center. The existence of the stand-alone store may have been planned by the mall's developer, or may have come about through opportunistic actions by others, but visually the central facility the mall or shopping center and the satellite buildings will often be perceived as being a single "unit", even in circumstances where the outlying buildings are not officially or legally connected to the mall in any way.

Dead malls
In the U.S, as more modern facilities are built, many early malls have become abandoned, due to decreased traffic and tenancy. These "dead malls" have failed to attract new business and often sit unused for many years until restored or demolished. Interesting examples of architecture and urban design, these structures often attract people who explore and photograph them. This phenomenon of dead and dying malls is examined in detail by the website, which hosts many such photographs, as well as historical accounts. Until the mid-1990s, the trend was to build enclosed malls and to renovate older outdoor malls into enclosed ones. Such malls had advantages such as temperature control. Since then, the trend has turned and it is once again fashionable to build open-air malls. According to the International Council of Shopping Centers, only one new enclosed mall has been built in the United States since 2006. Some enclosed malls have been opened up, such as the Sherman Oaks Galleria. In addition, some malls, when replacing an empty anchor location, have replaced the former anchor store building with the more modern outdoor design, leaving the remainder of the indoor mall intact, such as the Del Amo Fashion Center in Torrance, California.

New trends
In parts of Canada, it is now rare for new shopping malls to be built. The Vaughan Mills Shopping Centre, opened in 2004, and Crossiron Mills, opened in 2009, are the only malls built in Canada since 1992. Outdoor outlet malls or big box shopping areas known as power centres are now favored, although the traditional enclosed shopping mall is still


in demand by those seeking weather-protected, all-under-one-roof shopping. In addition the enclosed interconnections between downtown multi story shopping malls continue to grow in the Underground city of Montreal (32 kilometers of passageway), the PATH system of Toronto (27 km (17 mi) of passageway) and the Plus15 system of Calgary (16 km (9.9 mi) of overhead passageway).
Vertical malls

High land prices in populous cities have led to the concept of the "vertical mall," in which space allocated to retail is configured over a number of stories accessible by elevators and/or escalators linking the different levels of the mall. The challenge of this type of mall is to overcome the natural tendency of shoppers to move horizontally and encourage shoppers to move upwards and downwards. The concept of a vertical mall was originally conceived in the late 1960s by the Mafco Company, former shopping center development division of Marshall Field & Co. The Water Tower Place skyscraper, Chicago, Illinois, was built in 1975 by Urban Retail Properties. It contains a hotel, luxury condominiums, and office space and sits atop a block-long base containing an eight-level atrium-style retail mall that fronts on the Magnificent Mile. Vertical malls are common in densely populated conurbations such as Hong Kong and Bangkok. Times Square in Hong Kong is a principal example. A vertical mall may also be built where the geography prevents building outward or there are other restrictions on construction, such as historical buildings or significant archeology. The Darwin Shopping Centre and associated malls in Shrewsbury, UK, are built on the side of a steep hill, around the former outer walls of the nearby medieval castle; consequently the shopping centre is split over seven floors vertically two locations horizontally connected by elevators, escalators and bridge walkways. Some establishments incorporate such design into their layout, such as Shrewsbury's McDonalds restaurant, split into four stories with multiple mezzanines which feature medieval castle vaults complete with arrowslits in the basement dining rooms.





The Indian retail industry is the fifth largest in the world. Comprising of organized and unorganized sectors, India retail industry is one of the fastest growing industries in India, especially over the last few years. Though initially, the retail industry in India was mostly unorganized, however with the change of tastes and preferences of the consumers, the industry is getting more popular these days and getting organized as well. With growing market demand, the industry is expected to grow at a pace of 25-30% annually. The India retail industry is expected to grow from Rs. 35,000 crore in 2004-05 to Rs. 109,000 crore by the year 2010. Growth of Indian Retail According to the 8th Annual Global Retail Development Index (GRDI) of AT Kearney, India retail industry is the most promising emerging market for investment. In 2007, the retail trade in India had a share of 8-10% in the GDP (Gross Domestic Product) of the country. In 2009, it rose to 12%. It is also expected to reach 22% by 2010. According to a report by Northbride Capita, the India retail industry is expected to grow to US$ 700 billion by 2010. By the same time, the organized sector will be 20% of the total market share. It can be mentioned here that, the share of organized sector in 2007 was 7.5% of the total retail market.


Major Retailers in India Pantaloon: Pantaloon is one of the biggest retailers in India with more than 450 stores across the country. Headquartered in Mumbai, it has more than 5 million sq. ft retail space located across the country. It's growing at an enviable pace and is expected to reach 30 million sq. ft by the year 2010. In 2001, Pantaloon launched country's first hypermarket Big Bazaar. It has the following retail segments: Food & Grocery: Big Bazaar, Food Bazaar Home Solutions: Hometown, Furniture Bazaar, CollectionConsumer Electronics: e-zone Shoes: Shoe Factory Books, Music & Gifts: Depot Health & Beauty Care: Star, Sitara E-tailing: Entertainment: Bowling Co.

Tata Group Tata group is another major player in Indian retail industry with its subsidiary Trent, which operates Westside and Star India Bazaar. Established in 1998, it also acquired the largest book and music retailer in India Landmark in 2005. Trent owns over 4 lakh sq. ft retail space across the country. RPG Group RPG Group is one of the earlier entrants in the Indian retail market, when it came into food & grocery retailing in 1996 with its retail Foodworld stores. Later it also opened the pharmacy and beauty care outlets Health & Glow. Reliance 33

Reliance is one of the biggest players in Indian retail industry. More than 300 Reliance Fresh stores and Reliance Mart are quite popular in the Indian retail market. It's expecting its sales to reach Rs. 90,000 crores by 2010. AV Birla Group AV Birla Group has a strong presence in Indian apparel retailing. The brands like Louis Phillipe, Allen Solly, Van Heusen, Peter England are quite popular. It's also investing in other segments of retail. It will invest Rs. 8000-9000 crores by 2010.

Retail formats in India Hypermarts/supermarkets: large self-servicing outlets offering products from a variety of categories. Mom-and-pop stores: they are family owned business catering to small sections; they are individually handled retail outlets and have a personal touch. Departmental stores: are general retail merchandisers offering quality products and services. Convenience stores: are located in residential areas with slightly higher prices goods due to the convenience offered. Shopping malls: the biggest form of retail in India, malls offers customers a mix of all types of products and services including entertainment and food under a single roof. E-trailers: are retailers providing online buying and selling of products and services. Discount stores: these are factory outlets that give discount on the MRP.


Vending: it is a relatively new entry, in the retail sector. Here beverages, snacks and other small items can be bought via vending machine.

Category killers: small specialty stores that offer a variety of categories. They are known as category killers as they focus on specific categories, such as electronics and sporting goods. This is also known as Multi Brand Outlets or MBO's.

Specialty stores: are retail chains dealing in specific categories and provide deep assortment. Mumbai's Crossword Book Store and RPG's Music World are a couple of examples.

Challenges facing Indian retail industry The tax structure in India favors small retail business Lack of adequate infrastructure facilities High cost of real estate Dissimilarity in consumer groups Restrictions in Foreign Direct Investment Shortage of retail study options Shortage of trained manpower Low retail management skill

The Future The retail industry in India is currently growing at a great pace and is expected to go up to US$ 833 billion by the year 2013. It is further expected to reach US$ 1.3 trillion by the year 2018 at a CAGR of 10%. As the country has got a high growth rates, the consumer spending has also gone up and is also expected to go up further in the future. In the last 35

four year, the consumer spending in India climbed up to 75%. As a result, the India retail industry is expected to grow further in the future days. By the year 2013, the organized sector is also expected to grow at a CAGR of 40%.

Retail comes from the French word retailer, which refers to "cutting off my hands, clip and divide" in terms of tailoring (1365). It first was recorded as a noun with the meaning of a "sale in small quantities" in 1433 (French). Its literal meaning for retail was to "cut off, shred, off my toes paring". Like the French, the word retail in both Dutch and German (detail Handel and Einzelhandel respectively), also refers to the sale of small quantities of items.

Types of retail outlets

A marketplace is a location where goods and services are exchanged. The traditional market square is a city square where traders set up stalls and buyers browse the merchandise. This kind of market is very old, and countless such markets are still in operation around the whole world. In some parts of the world, the retail business is still dominated by small family-run stores, but this market is increasingly being taken over by large retail chains. Retail is usually classified by type of products as follows: Food products Hard goods ("hardline retailers") - appliances, electronics, furniture, sporting goods, etc. Soft goods - clothing, apparel, and other fabrics.

There are the following types of retailers by marketing strategy: Department stores - very large stores offering a huge assortment of "soft" and "hard goods; often bear a resemblance to a collection of specialty stores. A


retailer of such store carries variety of categories and has broad assortment at average price. They offer considerable customer service. Discount stores - tend to offer a wide array of products and services, but they compete mainly on price offers extensive assortment of merchandise at affordable and cut-rate prices. Normally retailers sell less fashion-oriented brands. However the service is inadequate.; General merchandise store - a hybrid between a department store and discount store; Supermarkets - sell mostly food products; Warehouse stores - warehouses that offer low-cost, often high-quantity goods piled on pallets or steel shelves; warehouse clubs charge a membership fee; Variety stores or "dollar stores" - these offer extremely low-cost goods, with limited selection; Demographic - retailers that aim at one particular segment (e.g., high-end retailers focusing on wealthy individuals). Mom-And-Pop or Kirana Stores: is a retail outlet that is owned and operated by individuals. The range of products are very selective and few in numbers. These stores are seen in local community often are family-run businesses. The square feet area of the store depends on the store holder. Specialty Stores: A typical specialty store gives attention to a particular category and provides high level of service to the customers. A pet store that specializes in selling dog food would be regarded as a specialty store. However, branded stores also come under this format. For example if a customer visits a Reebok or Gap store then they find just Reebok and Gap products in the respective stores. Convenience Stores: is essentially found in residential areas. They provide limited amount of merchandise at more than average prices with a speedy checkout. This store is ideal for emergency and immediate purchases.


Hypermarkets: provides variety and huge volumes of exclusive merchandise at low margins. The operating cost is comparatively less than other retail formats. A classic example is the Metro in Bangalore.

Supermarkets: is a self service store consisting mainly of grocery and limited products on non food items. They may adopt a Hi-Lo or an EDLP strategy for pricing. The supermarkets can be anywhere between 20,000-40,000 square feet. Example: SPAR supermarket.

Malls: has a range of retail shops at a single outlet. They endow with products, food and entertainment under a roof. Example: Sigma mall and Garuda mall in Bangalore, Express Avenue in Chennai.

Category Killers or Category Specialist: By supplying wide assortment in a single category for lower prices a retailer can "kill" that category for other retailers. For few categories, such as electronics, the products are displayed at the centre of the store and sales person will be available to address customer queries and give suggestions when required. Other retail format stores are forced to reduce the prices if a category specialist retail store is present in the vicinity. For example: Pai Electronics store in Bangalore, Tata Croma.

E-tailers: The customer can shop and order through internet and the merchandise are dropped at the customer's doorstep. Here the retailers use drop shipping technique. They accept the payment for the product but the customer receives the product directly from the manufacturer or a wholesaler. This format is ideal for customers who do not want to travel to retail stores and are interested in home shopping. However it is important for the customer to be wary about defective products and non secure credit card transaction. Example: Amazon and Ebay.

Vending Machines: This is an automated piece of equipment wherein customers can drop in the money in machine and acquire the products. For example: Soft drinks vending at Bangalore Airport.


Some stores take a no frills approach, while others are "mid-range" or "high end", depending on what income level they target. Other types of retail store include: Automated Retail stores are self service, robotic kiosks located in airports, malls and grocery stores. The stores accept credit cards and are usually open 24/7. Examples include ZoomShops and Red box. Big-box stores encompass larger department, discount, general merchandise, and warehouse stores. Convenience store - a small store often with extended hours, stocking everyday or roadside items; General store - a store which sells most goods needed, typically in a rural area;

Retailers can opt for a format as each provides different retail mix to its customers based on their customer demographics, lifestyle and purchase behavior. A good format will lend a hand to display products well and entice the target customers to spawn sales.

Heritage at a Glance: The Heritage Group, founded in 1992 by Sri Nara Chandra Babu Naidu, is one of the fastest growing Private Sector Enterprises in India, with four-business divisions viz., Dairy, Retail, Agri, and Bakery under its flagship Company Heritage Foods (India) Limited (HFIL). The annual turnover of Heritage Foods crossed Rs.1096 crores in 201011. Presently Heritages milk products have market presence in Andhra Pradesh, Karnataka, Kerala, Tamil Nadu and Maharashtra and its retail stores across Bangalore, Chennai and Hyderabad. Integrated agri operations are in Chittoor and Medak Districts and these are backbone to retail operations.


In the year 1994, HFIL went to Public Issue to raise resources, which was oversubscribed 54 times and its shares are listed under B1 Category on BSE (Stock Code: 519552) and NSE (Stock Code: HERITGFOOD) About the founder: Sri Chandra Babu Naidu is one of the greatest Dynamic, Pragmatic, Progressive and Visionary Leaders of the 21st Century. With an objective of bringing prosperity in to the rural families through co-operative efforts, he along with his relatives, friends and associates promoted Heritage Foods in the year 1992 taking opportunity from the Industrial Policy, 1991 of the Government of India and he has been successful in his Endeavour. At present, Heritage has market presence in all the states of South India. More than three thousand villages and five lakh farmers are being benefited in these states. On the other side, Heritage is serving more than 6 lakh customers needs, employing more than 700 employees and generating indirectly employment opportunity to more than 5000 people. Beginning with a humble annual turnover of just Rs.4.38 crores in 1993-94, the sales turnover has reached close to Rs.300 crores during the financial year 2005-2006. Sri Naidu held various coveted and honorable positions including Chief Minister of Andhra Pradesh, Minister for Finance & Revenue, Minister for Archives & Cinematography, Member of the A.P. Legislative Assembly, Director of A.P. Small Industries Development Corporation, and Chairman of Karshaka Parishad. Sri Naidu has won numerous awards including " Member of the World Economic Forum's Dream Cabinet" (Time Asia ), "South Asian of the Year " (Time Asia ), " Business Person of the Year " (Economic Times), and " IT Indian of the Millennium " ( India Today). Sri Naidu was chosen as one of 50 leaders at the forefront of change in the year 2000 by the Business Week magazine for being an unflinching proponent of technology and for his drive to transform the State of Andhra Pradesh . Forward looking statements:


We have grown, and intended to grow, focusing on harnessing our willingness to experiment and innovate our ability to transform our drive towards excellence in quality, our people first attitude and our strategic direction. Mission Bringing prosperity into rural families of India through co-operative efforts and providing customers with hygienic, affordable and convenient supply of " Fresh and Healthy " food products.

Vision To be a progressive billion dollar organization with a pan India foot print by 2015. To achieve this by delighting customers with "Fresh and Healthy" food products, those are a benchmark for quality in the industry. We are committed to enhanced prosperity and the empowerment of the farming community through our unique "Relationship Farming" Model. To be a preferred employer by nurturing entrepreneurship, managing career aspirations and providing innovative avenues for enhanced employee prosperity. Heritage Slogan: When you are healthy, we are healthy When you are happy, we are happy We live for your "HEALTH & HAPPINESS" Quality policy of HFIL: We are committed to achieve customer satisfaction through hygienically processed and packed Milk and Milk Products. We strive to continually improve the quality of our products and services through up gradation of technologies and systems.


Heritage's soul has always been imbibed with an unwritten perpetual commitment to itself, to always produce and provide quality products with continuous efforts to improve the process and environment. Adhering to its moral commitment and its continuous drive to achieve excellence in quality of Milk, Milk products & Systems, Heritage has always been laying emphasis on not only reviewing & re-defining quality standards, but also in implementing them successfully. All activities of Processing, Quality control, Purchase, Stores, Marketing and Training have been documented with detailed quality plans in each of the departments. Today Heritage feels that the ISO certificate is not only an epitome of achieved targets, but also a scale to identify & reckon, what is yet to be achieved on a continuous basis. Though, it is a beginning, Heritage has initiated the process of standardizing and adopting similar quality systems at most of its other plants. Commitments: Milk Producers: Change in life styles of rural families in terms of: Regular high income through co-operative efforts. Women participation in income generation . Saved from price exploitation by un-organized sector . Remunerative prices for milk . Increase of milk productivity through input and extension activities Shift from risky agriculture to dairy farming Heritage Financial support for purchase of cattle; insuring cattle Establishment of Cattle Health Care Centers Supplying high quality Cattle feed


Organizing "Rythu Sadasu" and Video programmes for educating the farmers in dairy farming

Customers: Timely Supply of Quality & Healthy Products Supply high quality milk and milk products at affordable prices Focused on Nutritional Foods More than 4 lakh happy customers High customer satisfaction 24 hours help lines ( <10 complaints a day)

Employees: Enhancing the Technical and Managerial skills of Employees through continuous training and development Best appraisal systems to motivate employees Incentive, bonus and reward systems to encourage employees Heritage forges ahead with a motto "add value to everything you do"

Returns: Consistent Dividend Payment since Public Issue (January 1995)

Service: Highest impotence to investor service; no notice from any regulatory authority since 2001 in respect of investor service Very transparent disclosures



Doehlar: technical collaboration in Milk drinks, yogurts drinks and fruit flavoured drinks Alfa-Laval: supplier of high-end machinery and technical support Focusing on Tetra pack association for products package. Society: Potential Employment Generation More than 3500 employees are working with heritage More than 9500 procurement agents got self employment in rural areas More than 5000 sales agents associated with the company Employment for the youth by providing financial and animal husbandry support for establishing MINI DAIRIES Producing highly health conscious products for the society

Qualities of management principles: Customer focus to understand and meet the changing needs and expectations of customers. People involvement to promote team work and tap the potential of people. Leadership to set constancy of purpose and promote quality culture trough out the organization. Process approach to assess the efficiency and effectiveness of each process. Systems approach to understand the sequence and interaction of process. Factual approach to decision making to ensure its accuracy. Continual improvement processes for improved business results. Development of suppliers to get right product and services in right time at right place. Product/Market wise performance:


The total turnover is Rs 341 Crores during the financial year 2006-07 against the turnover of 292.02 Crores in 2005-06. Today Heritage distributes quality milk & milk products in the states of A.P, Karnataka, Kerala & Tamil nadu. During the year 2006-07 liquid milk sales was Rs.28329.79 lakhs against Rs.24525.23 lakhs in the previous year. The sales of milk products including bulk sales of cream, ghee and butter were recorded Rs 5781.59 lakhs against Rs 4677.21 lakhs. Milk sales: 23% growth was recorded in AP 2.38 lakhs litres per day(LLPD) in 2006-07 against 1.93 LLPD in 2005-06. 13% growth was recorded in Tamilnadu-1.53 LLPD in 2006-07 against 1.35 LLPD in 2005-06. Over all growth of 6% was recorded- 5.49 LLPD in 2006-07 against 5.16 LLPD. Flavoured milk sales recorded a growth rate of 77% over 2005-06. Butter milk sales have gone up by 45% over 2005-06.

Outlook: Considering the growth potential in the liquid milk market, the company has drawn plans to increase its market share in the existing markets and to enter into new markets there by doubling revenues in dairy business in the next 3 years. To achieve this object, company is undertaking major expansion in dairy business by inverting over Rs20 crores during 2006-07 and over Rs10 crores during the current year to strengthen the milk procurement.



PREFACE This Code of Conduct and Ethics (herein after referred to as the "Code") has been adopted by the Board of Directors of Heritage Foods (India) Limited (herein after referred to as "the Company") , to be applicable to all Directors and all members of senior management i.e., personnel who are a part of the core management team and including all


functional heads of the company (herein after referred to as the 'Members') with effect from December 23, 2005. This Code helps the Members maintain good standards of business conduct, foster ethical and moral conduct and promote a culture of honesty and accountability, so as to set an example to others in the company. The Code is not an all-inclusive comprehensive policy and cannot anticipate every situation that may arise in the course of the company's business. The Members are expected to bear in mind the essence and substance of the Code in all their dealings / transactions with the Company. STRICT COMPLIANCE All Members shall act within the bounds of the authority conferred upon them and undertake the duty to make and enact informed, judicious and harmonious decisions and policies in the best interests of the Company and its shareholders / stakeholders. With a view to maintain the high standards the Company requires, the following rules/ code of conduct to be observed in all activities. For the purpose of the code, the Company appoints the Company Secretary as compliance officer, who will be available to Members to answer questions and help them in complying with the code. CONFLICT OF INTEREST The term "Conflict of interest" pertains to situations in which financial or personal considerations may compromise, or have the appearance of compromising judgment of professional activities. A conflict of interests exists where the interests or benefits of one person or entity conflicts with the interests or benefits of the other person/entity/company. All Members should not engage in any business, relationship or activity, which may be in conflict with the interest of the Company. Conflict may arise in many situations. It is not possible to cover every possible conflict situation and at times, it will not be easy to


distinguish between the proper and improper activities. Set forth below, are some of the common circumstances that may lead to conflict of interest, actual or potential. i. Members should not engage in any activity / employment that interfere with your performance or responsibility to the Company or otherwise in conflict with or prejudicial to the interests of the Company. ii. As a general policy, Members should avoid conducting business with a relative or with a firm / Company in which a relative / related party is associated in a significant role / position. iii. Whenever/ wherever the related party transaction is unavoidable Members will fully disclose their interest in the transaction to the Board or to the CEO of the Company and due records for such transactions will be maintained as per the statutory requirements. HONESTY AND INTEGRITY All Members shall conduct their activities, on behalf of the Company and on their personal behalf, with honesty, integrity and fairness. They will act in good faith, with responsibility, due care, competence and diligence, allowing independent judgment to their subordinates. Members shall act in the best interests of the Company and fulfill their fiduciary obligations. POLICY OF BUSINESS RELATIONSHIP The Company will conduct business legally and ethically. The quality of company's products and the efficiency of its services at the most competitive price is the greatest tool in conducting the business of the company. Profits do not justify unfair/ unethical practices. All Members should uphold the highest standards of integrity in all the business relationships.

INTELLECTUAL PROPERTY POLICY All Members have utmost obligation to identify and protect the intellectual properties, trade secrets and confidential information owned by the Company and its clients or associates as it is critical to the success of the company. "Intellectual Property Rights"


(IPR) means generally patented or potentially patentable inventions, trademarks, copyrightable subject matters and trade secrets. CORPORTE OPPORTUNITIES Members owe a duty to the Company to advance its legitimate interests when the opportunity to do so arises and are expressly prohibited from improper use of information / property or taking improper advantage of their position. PREVENTION OF INSIDER TRADING Insider trading is prohibited both by the Law as well as by the company policy . Insider trading generally involves the act of subscribing to or buying or selling of the Company's securities, when in possession of any Unpublished Price Sensitive Information about the company. "Price sensitive information " is such information, which relates directly or indirectly to the company and which if published is likely to materially affect the price of securities of the Company. It is important to note that both positive and negative information could be price sensitive. Members shall not derive benefit or assist others to derive benefit or assist them to derive benefit on their behalf by giving investment advice from the available access to and possession of information about the Company, which is not in public domain and thus constituting insider information. Members shall comply with the prevention of insider trading guidelines as issued by Securities Exchange Board of India (SEBI). SECURITIES MARKET POLICY The Company is committed to comply with securities laws in all the markets in which the Company's securities are listed. The company prohibits fraudulent and unfair trade practices with regard to the securities of the Company by all Members. CONFIDENTIALITY OF INFORMATION POLICY The Company's confidential information is a valuable asset. Members shall understand that protection of all confidential information is essential. Members should undertake and be committed to protecting business and personal information of confidential nature obtained from clients, associates and employees.


Any information concerning the Company's business, its customers, suppliers etc which is not in the public domain and to which the Members have access or possesses such information, shall be considered confidential and held in confidence, unless authorized to disclose or such disclosure is required as a matter of law. Members shall not provide any information either formally or informally, to the press or any other publicity media, unless specially authorized to do so. COMPLIANCE WITH LAWS, RULES AND REGULATIONS Members should comply with all applicable laws, rules, and regulations, both in letter and sprit. In order to assist the Company in promoting the lawful and ethical behavior, Members have to report any possible violation of law, rules, regulations or the code of conduct to the Company Secretary. PROTECTION AND PROPER USE OF COMPANYS ASSETS All Members have the responsibility to protect the assets of the company, ensure optimal utilization of assets and to report and record all transactions. Members shall protect the Company's assets from loss, damages, misuse or theft and assets may only be used for business purposes and other purposes specifically approved by management and must never be used for any personal or illegal purposes. COMPETITION POLICY The Company shall compete only in an ethical and legitimate manner. It prohibits all actions that are anti- competitive or otherwise contrary to laws that govern competitive practices in the market place. Members shall uphold the same.

SELECTING SUPPLIERS The Company's suppliers make significant contribution to its success. The Company's policy is to purchase / avail supplies based on need, quality, service, price and other commercial terms and conditions. Suppliers should be selected based on merit, price, quality and performances. The Company's policy is to select significant suppliers through a competitive bid process wherever possible. Under no circumstance should the Company or its employee, agent or contractor attempt to coerce suppliers in any way.


ENVIRONMENT, HEALTH AND SAFETY POLICY Members shall take environmental consciousness a step further as a company and contribute to preserving nature as well as safety measures in own respective work areas. All Members are responsible for conducting safe and environmentally sound operations; this is in the interest of our own well-being and the quality of life of others. Members shall abide by this policy. ELIMINATION OF CHILD LABOUR It is the Company's policy not to support child labor. The Company is committed to implement the provisions of the Child Labor (Prohibition and Regulation) Act, 1986. To, promote this the Company encourages its suppliers also to work towards a no child labor policy in their industries. Members shall strictly observe that no child labor is employed in the company. ABOLITION OF FORCED LABOUR The Company strictly prohibits forced or compulsory labor. The Company is committed to ensuring that employees enter into employment and stay on in the Company of their own free will. Members shall uphold this policy. GIFTS & DONATIONS No Member shall receive or offer, directly or indirectly, any gifts, donations, remuneration, hospitality, illegal payments and comparable benefits which are intended or perceived to be intended to obtain business (or uncompetitive) favors or decision for the conduct of the business. Normal gifts of commemorative nature for special events may be accepted and reported to the Board. OTHER DIRECTORSHIPS The Company feels that serving on the Board of directors of other companies may raise substantial concerns about potential conflict of interest. Therefore all Directors shall report / disclose such relationships to the Board on an annual basis. It is felt that service on the Board of a direct competitor is not in the interest of the Company. Hence all the Directors are barred in accepting such position without the concurrence of the Board. ACCOUNTABILITY 50

The Board of Directors (BOD) shall oversee the Company's adherence to ethical and legal standards. All employees and members of the BOD shall undertake to stop or prevent actions that could harm customers or reputation of the Company and to report such actions as soon as they occur to take corrective steps and see that such actions are not repeated. COMPLIANCE WITH CODE OF CONDUCT Each Director and senior management personnel shall adhere to this code of conduct and affirm compliance with the code on an annual basis as per the Annexure to the Code. Violation of this Code will lead to appropriate disciplinary action. WAIVER OF THE CODE Any waiver of the applicability of the Code or waiver of application of any provision of the Code to any Member shall be approved by the Board of Directors and disclosed as required by Law or SEBI / Stock Exchange regulations. BRANCHES OF HFIL: HFIL has 3 wings. They are Dairy Retail Agribusiness

1. Dairy: It is the major wing among all. The dairy products manufactured by HFIL are Milk, curd, butter, ghee, flavoured milk, paneer, doodhpeda, ice cream.

2. Retail: In the retail sector HFIL has outlets namely Fresh@. In those stores the products sold are vegetables, milk& milk products, grocery, pulses, fruits etc.


In Hyderabad 19 retail shops are there. In Bangalore& Chennai, 3&4 respectively are there. Totally there are 26 retail shops are there. Fresh@ is a unique chain of retail stores, designed to meet the needs of the modern Indian consumer. The store rediscovers the taste of nature every day making grocery shopping a never before experience. The unique& distinctive feature of Fresh@ is that it offers the widest range of fresh fruits and vegetables which are directly hand picked from the farms. Freshness lies in their merchandise and the customers are always welcomed with fresh fruits and vegetables no matter what time they walk in. 3. Agri Business: In this business HFIL employees will go to farmers and have a deal with them. Those farmers will sell their goods like vegetables, pulses to HFIL only. And HFIL will transport the goods to retail outlets. The agricultural professors will examine which area is suitable to import vegetables from and also examine the vegetables, pulses and fruits in the lab. And finally they report to the Head-Agribusiness. Representatives as per the instructions given by the agri professors will approach the farmers directly and make a deal with them. It is the process of registering the farmers.

Heritage Finlease Heritage Finlease Limited was incorporated under the companies Act 1956 on 23rd of February 1996 and commenced business from 2nd day of April 1996. The Registered office is located at 6-3-541/c Punjagutta, Hyderabad-500082.

The following are the directors of the company: Sri D.Seetharamaiah Smt. N. Bhuvaneswari 52

Sri M. Sivarama Varaprasad Sri R.S.Bakkannavar The Company was registered as Non Banking Financial Institution on 5th Day of December 1998 by Reserve Bank of India as a Deposit Taking Company under the category Hire Purchase Company. At Present the company is allowing Dairy Loans to Small Farmers under Tie up arrangement with Heritage Foods (India) Limited. The Company has been earning profits from inception and functioning in conformity with the rules and directions of Reserve Bank of India.



AGE GROUP OF THE RESPONDENTS: The below table shows the age group of the respondents surveyed:
AGE 18-28 No Of Respondents 54


28-38 38-48 Above 48 Total

28 10 8 100

INFERENCE: From the above table, 54% of the respondents belong to the age group of 18-28 years, 28% of the respondents belong to the age group of 28-38 years, 10% of the respondents belong to the age group of 38-48 years, 8% of the respondents belong to the age group of above 48 years.



The below table shows the type of respondents of the respondents surveyed.
Occupation Student Business Private Employee Govt Employee Total No Of Respondents 36 18 28 18 100

INFERENCE: From the above table 36% of the respondents are students, 18% of the respondents are businessmen, 28% of the respondents are private employee, 18% of the respondents are Govt employee.

HAVING KNOWLEDGE OR NOT: The below table shows that whether the respondents is having a two wheeler or not


Having Knowledge or not Yes No Total

Having knowledge or not

No of respondents 80 20 100


Yes No


INFERENCE: From the above table 80%of people having Knowledge Retail products and 20% are not having Knowledge Retail products.

TYPE OF FOOD PRODUCTS THAT THE RESPONDENT IS KNOWN: The below table shows the type of food products that the respondent know.
Type of food products HERITAGE No of respondents 42 % of respondents 42



14 26 15 03 100

14 26 15 3 100

INFERENCE: From the above table 42%of the respondents are having HERITAGE food products. 14%of the respondents are having SHOPPERS STOP. 26%of the respondents are having MORE food productss.15% of the respondents are having BIG BAZAAR food productss.3% of the respondents are having LIFE STYLE food products. SOURCES OF INFORMATION The below table shows, from where did the respondent get the information about the Food products.
Sources of information Offers Advertisements No of respondents 15 27


Referred from friends & relatives Technology Finance Schemes Total

33 10 15 100

INFERENCE: From the above table 15%of people known from offers, 27% of people known from advertisements, and 33% of people known from their friends and relatives, 10% of people known from technology, 15% of people known from finance schemes.


Service HERITAGE Style Excellent Very good Good 9 0 10 Performance 5 9 11 Features 0 6 13 Price 11 3 12 Quality 15 9 1 Reliability providing 0 15 11 0 10 5

Neatness Brand Imag 0 0 15 9 11 5


Average Poor

6 0

5 0

1 0

1 0

0 0

1 0

0 0

7 1

0 0

SHOPPERS STOP Excellent Very good Good Average Poor

Style Performance Features Price Quality

Reliability Service providing

Neatness Brand Image

6 4 2 0 0

1 5 4 2 0

2 6 5 5 0

0 7 5 8 0

0 8 0 6 0

0 2 2 0 0

0 6 6 2 0

1 2 7 3 0

2 1 2 9 0




LIFE STYLE Style Excellent Very good Good Average Poor 2 2 0 1 0 Performance Features 3 5 5 5 0 9 9 3 2 0 Price 5 5 4 0 0 Quality Reliability Service providing 2 4 5 6 0 7 6 5 0 0 0 5 6 5 0 Neatness Brand Image 2 1 3 5 2 3 2 8 1 2



Service MORE Excellent Very good Good Average Poor 2 6 2 0 5 2 5 0 6 8 6 0 4 9 2 0 6 3 4 0 6 5 8 0 4 7 7 0 6 14 2 0 8 5 5 0 Style 3 Performance 6 Features 2 Price 5 Quality 6 Reliability providing 8 5 Neatness 6 Brand Image 4

The following table shows, the main motive, which the respondents want to be in their brand of food products.


Main Motive
Style Performance Features Price Quality Reliability Service providing Neatness Total

No of Respondents
11 22 4 22 2 1 21 17 100

% of respondents 11 22 4 22 2 1 21 17 100

INFERENCE: From the above table 11% of the respondents preferred STYLE as their main motive, 22% of the respondents preferred PRICE as their main motive, 4%of the respondents preferred PERFORMANCE as their main motive, 22% of the respondents preferred QUALITY as their main motive, 2% of the respondents preferred RELIABILITY as their


main motive, 1% of the respondents preferred SERVICE as their main motive, 21% of the respondents preferred NEATNESS as their main motive, 17% of the respondents preferred BRAND IMAGE as their main motive.

STYLE: The following table shows that, some of the brands of Retail products respondents selected STYLE as their main motive.
Brand No of respondents



24 35 30 01 10 100



The above table shows that SHOPPERS STOP and MORE are the competitors with HERITAGE. PRICE: The following table shows that, some of the brands of Retail products respondents selected PRICE as their main motive.

No of respondents
27 18 42 1 12 100

INFERENCE: The above table shows that MORE is the competitor with HERITAGE. PERFORMANCE:


The following table shows that, some of the brands of Retail products respondents selected PERFORMANCE as their main motive.
Brand HERITAGE SHOPPERS STOP MORE BIG BAZAAR LIFE STYLE Total No of respondents 45 10 30 10 5 100

INFERENCE: The above table shows that HERITAGE is the best. QUALITY: The following table shows that, some of the brands of Retail products respondents selected QUALITY as their main motive.



No of respondents 54 5 21 15 5 100

INFERENCE: The above table shows that HERITAGE is the best. RELIABILITY: The following table shows that, some of the brands of Retail products respondents selected RELIABILITY as their main motive.
Reliability HERITAGE No of respondents 40



2 40 15 3 100

INFERENCE: The above table shows that MORE is the competitor with HERITAGE.

SERVICE: The following table shows that, some of the brands of Retail products respondents selected SERVICE as their main motive.
After Sales Service HERITAGE SHOPPERS STOP MORE No of respondents 52 8 27



3 10 100

INFERENCE: The above table shows that HERITAGE is the best. NEATNESS: The following table shows that, some of the brands of Retail products respondents selected NEATNESS as their main motive.




INFERENCE: The above table shows that HERITAGE is the best.

BRAND IMAGE: The following table shows that, some of the brands of Retail products respondents selected BRAND IMAGE is their main motive
Brand Image HERITAGE SHOPPERS STOP MORE LIFE STYLE BIG BAZAAR Total No of respondents 30 10 30 15 15 100


INFERENCE: The above table shows that HERITAGE & MORE is the best. Respondents who want to buy the Shopping of a particular brand:
Brand HERITAGE SHOPPERS STOP MORE LIFE STYLE BIG BAZAAR Total No of respondents 45 00 20 10 25 100


INFERENCE: The above table shows 45% of the respondents want to buy HERITAGE.





The food products recently introduced by HERITAGE are mostly concerned

about Stylish Goods. So, they should also consider middle-class people also Indian market is a price sensitive markets the food products should be at

Minimum price with maximum quality. the The standard of service should be improved. Advertisements in Televisions, offers should be increased to attract the People.

If HERITAGE can improve in STYLE and NEATNESS it will be the best in all Other competition brands.


40% of the respondents are HERITAGE customers and hence it is most

Preferred Retail products brand out of various brands. HERITAGE DAIRI is the most preferred out of All others

60% of the respondents are considering HERITAGE brand before Purchasing

their retail needs. Most of the respondents are getting information through friends Before

purchasing the retail brand products. Most of the respondents are having good satisfaction with Service comparing Most of the respondents are giving more preference to Quality.

to other brands.

60% of the respondents are affecting by their friends and relatives.


40% of the HERITAGE customers are employees and 29% of the customers are others. Most of the respondents belong to the age group of 18-40 years. HERITAGE DARI & RETAIL Products is the most preferred in the

HERITAGE products. Most of the respondents getting information through the Media and friends before purchasing the vehicle. Most of the respondents are motivated by their friends and family members. Most of the respondents have good satisfaction with the performance of outlets. 64% of the respondents are satisfied with the Quality of their Products. Most of the respondents felt that the price is reasonable. Cent percent of the respondents satisfied with the response of the sales executive at first visit. 60% of the HERITAGE users have good satisfaction with the services given by the company. Most of the respondents are satisfied with the response of the company to the complaints given by the customers. Most of the respondents are satisfied with the fulfillment of promises by the company.




Gender: Male/ Female______ Age: ____ Highest Educational Qualification:_______________


How Often you visit Heritage store: ..


What is the best in Heritage store:? 1) Infrastructure 3) Service 2) Arrangement 4) None


Rate the Heritage service ? a) Poor b) Moderate c) Satisfactory d) Good e) excellent.


Type of facility:..

a) b) c)

Self serve Full serve Both

Q.5) store

Are you satisfied by customar service provided at Heritage retail a) YES b) NO



What is your Average bill that you make here:


In which way you preferred in buying Heritag Brand a)Offer b)advertisement c)Technology d)Finance schems


Availability of products at Heritage retail store is ? a)excellent b)very Good c)Good d)Average e)Poor


Rate the prices indexed here relating to Market price(Other stores? a) Low b) Moderate/Satisfactory c) High





Q.11) Out of the following products which products are being sold at your retail Outlet?(Please tick at appropriate place)

Type of Product Groceries FMCG NON-FMCG

Your response


. AUTHOR NAME PHILLIP KOTLER Edition Prentice Hall India. PHILLIP KOTLAR Marketing Management Millennium Edition.Prentice Hall India V.S.RAMASWAMY & NAMAKUMARI RICHARD R STILL Marketing Management -7th Edition Millennium India Ltd. Sales Management -5th Edition Prentice Hall India. G.C.BERI Marketing Research -6th Edition Tata McGraw Hill Co.Ltd. LUCK DAVID & ROBIN RONALD Marketing Research -7th Edition Prentice Hall India. REFERED BOOKS Principles of Marketing 11 th