RETAIL AND SALES MANAGEMENT

MODULE 1
Done By

Anna Shabeer Swathi

RETAILING AND RETAILER

Is defined as a set of activities or steps used to sell a product or service to consumers for their personal or family use. Retailer: Person, agent, Co., or organization instrumental in reaching the goods, merchandise or services to the ultimate customer.

NATURE OF RETAIL MARKETING

Profitable retailing and satisfactory returns on investment can only be achieved by identifying, anticipating and satisfying customer needs and desires What the customers buy determines the nature of the retailers business. The essence of retail marketing is developing merchandise and services that satisfy specific needs of customers, and supplying them at prices that will yield profits.

Contd.
Cost & profit varies depending on type of operation & major product line Manage profit of 9-10% on sales Sales volume influences business opportunities, merchandise purchase policies, nature of promotion & expense control measures Retailers act as gatekeepers who decide which new products should formed their way to the shelves of their stores.a strong say in the success of a product being launched Marketers have to sell a new product several times: first within the Co, then to the retailer & finally to the user of the product

KEY ASPECTS OF RETAILING

oDirect customer interaction oSmall unit size of sale

oPoint of sale promotions

oCriticality of location oEmphasis of location

DRIVERS OF CHANGE IN RETAILING

Changing demographics & industry structure Expanding IT Emphasis on lower costs & price Emphasis on convenience & service Focus on productivity Added experimentation Continuing growth of non store retailing

CHARACTERISTICS OF RETAILING
There is a direct end user interaction Only point in the value chain to provide a platform for promotion Sale if small unit sizes Location is a critical factor Services are as imp as core products Large no of retail units to meet the geographical coverage & population density

GLOBAL RETAILING
Market Size & Economics Infrastructure & Distribution Competition Operations

Factors Used to Analyze Global Retail Markets

Financial & Tax Reporting Merchandise Acceptability Partnering Capability

GLOBAL RETAILING

Reasons for Global Expansion

Spread of communication and mass media

Growth potential in underserved markets

Lowering of trade barriers and tariffs

GLOBAL PLAYERS
Wal Mart Carrefour Home depot Tesco Sears JC Penney

INDIAN RETAIL INDUSTRY

5 th largest retail destination globally Comprising of organized and unorganized sectors, though initially, the retail industry was mostly unorganized Largest no of retailers about 12 million 5 million sell food & related products Retail sector is the 2 nd largest employer after agriculture Amounts to US$ 330billion in 2007 to 427b in 2010 & 637 b by 2015 Retail has a share of 10 -11% in the GDP 6 times bigger than that of T hailand & 4 -5 times bigger than South Korea & Taiwan Expected growth rate 25 -30% annually. Available mall space 100 mill square feet by 2011

MAJOR RETAILERS IN INDIA

Pantaloon With more than 450 stores across the country Launched country's first hypermarket Big Bazaar
Tata Group A major player with its subsidiary Trent, which operates Westside and Star Bazaar. Established in 1998, it also acquired the largest book and music retailer in India Landmark in 2005.

contd.
RPG Group One of the earlier entrants in the Indian retail market, food & grocery retailing in 1996 with its retail Food world stores. Opened the pharmacy and beauty care outlets Health & Glow.

Reliance More than 300 Reliance Fresh stores and Reliance Mart It's expecting its sales to reach Rs. 90,000 crores by 2011. A Birla Group Strong presence in Indian apparel retailing. T he brands like Louis Philippe, Allen Solly, Van Heusen, Peter England

CLASSIFICATION OF RETAIL
Retail is usually classified by type of products as follows: Food products Hard goods or durable goods ("hardline retailers") appliances, electronics, furniture, sporting goods, etc. (Goods that do not quickly wear out and provide utility over time.) Soft goods or consumables - clothing, apparel, and other fabrics. (Goods that are consumed after one use or have a limited period (typically under three years) in which you may use them.)

MAJOR TYPES OF RETAIL OPERATIONS

Department Stores Eg: SS, Westside, Globus Specialty Stores Eg: Bata, Nokia world, Adidas Supermarkets Drugstores Eg:Medicine Shoppe, Apollo Pharmacies Convenience Stores Discount Stores Eg: Wal-mart,Big Bazar

E-TAILING.
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. Example: Amazon, Pennyful and Ebay.

RETAIL FORMATS AVAILABLE

Mono/Exclusive branded retail shops
- Showrooms either owned or franchised - Complete range available for a given brand

Multi Branded retail shops

- Focus on particular product categories and carry most of the brands available - Customers get to have more choices

Convergence retail outlets

- Display of convergence goods - Product lines of different brands-one stop shop.

CHALLENGES FACING INDIAN RETAIL INDUSTRY

Regulatory barrier:(Restrictions on foreign investment in retailers, in terms of both absolute amount of financing provided and percentage share of voting stock )

T he tax structure favors small retail business Lack of adequate infrastructure facilities (Absence of developed supply chain and integrated IT management) High cost of real estate Dissimilarity in consumer groups Shortage of retail study options Shortage of trained manpower Low retail management skill

RETAIL PRICING
The pricing technique used by most retailers are: a) Cost-plus pricing: involves adding a markup amount (or percentage) to the retailer's cost. b) suggested retail pricing: involves charging the amount suggested by the manufacturer and usually printed on the product by the manufacturer.

BENEFITS OF TECHNOLOGY IN RETAILING INDUSTRY

Retailing market is in a state of explosive growth and one of the key factor in achieving the efficient retailing operations is by use of technology. Here are the some of the benefits a retailer can get by using different technologies :

Improves Store Efficiency Enhances Customer Satisfaction More productive space

 Saves Cost

Customer Database Customer paper works Investing in technology appropriately can impact the business positively through improved operational efficiencies, increased profitability, happier customers and providing a competitive advantage.

SALES ORGANIZATION

SALES ORGANIZATION

A group of individuals striving jointly to reach qualitative and quantitative objectives, and bearing informal and formal relations to one another

PURPOSES OF SALES ORGANIZATION

To permit the development of specialists To assure that all necessary activities are performed

To achieve coordination or balance

To define authority To economize on execution time

SETTING UP A SALES ORGANIZATION

Defining Objectives Determination of Activities and their Volume of Performance Grouping activities into positions Assignment of Personnel to positions Provisions for coordination and control

BASIC TYPES OF SALES ORGANIZATIONAL STRUCTURES

LINES SALES ORGANIZATION

General Manager

Sales Manager

Assistant Sales Manager Div. 1

Assistant Sales Manager Div. 2

Assistant Sales Manager Div. 3

Assistant Sales Manager Office

Salespeople

Salespeople

Salespeople

Office Staff

LINE AND STAFF SALES ORGANIZATION

President
VP (Marketing)
Advertising Manager General Sales Manager
Manager (Marketing Research)

Director (Sales and Training)

Sales Personnel Director

Assistant General Sales Manager

District Sales Managers Branch Sales Managers

Sales Personnel
Assistant to General Sales Manager

Sales Promotion Manager

Director of Dealer and Distribution Relations

FUNCTIONAL TYPE OF SALES ORGANIZATION

Director of Sales Administration

Installation and Service Manager

Manager of Sales Training

Manager of Sales Supervision

Manager of Sales Promotion

Manager of Dealer and Distribution Networks

Manager of Sales Personnel

Sales person

Sales person

Sales
person

Sales person

Sales person

Sales

person

SCHEMES FOR DIVIDING THE LINE AUTHORITY IN THE SALES ORGANIZATION

GEOGRAPHIC DIVISION OF LINE AUTHORITY

General Sales Manager

Sales Personnel Director

Eastern Division Sales Manager

Director of Sales and Training

Central Division Sales Manager

Director of Sales Promotion

Western Division Sales Manager

Director of Sales Analysis

Branch Sales Managers

Branch Sales Managers

Branch Sales Managers

Sales Personnel

Sales Personnel

Sales Personnel

PRODUCT DIVISION OF LINE AUTHORITY

General Sales Manager

Sales Manager Product 1

Sales Personnel Director

Director of Sales and Training

Director of Sales Promotion

Director of Sales Analysis

Sales Manager Product 2

Sales Personnel Product 1

Sales Manager Product 1

CUSTOMER DIVISION OF LINE AUTHORITY

General Sales Manager

Director Product R and D

Manager, Lumber Industry Sales

Director of Sales Planning

Manager, Construction Industry Sales

Director of Sales Training

Manager, Mining Industry Sales

Director of Sales Promotion and Advertising

Branch Sales Managers

Branch Sales Managers

Branch Sales Managers

Sales Personnel

Sales Personnel

Sales Personnel

MARKETING CHANNEL DIVISION OF LINE AUTHORITY

General Sales Manager Sales Personnel Director Director of Sales Planning Sales Promotion Manager Advertising Manager Director of Customer Relations

Sales Manager Chain Store Sales

Sales Manager Wholesale Sales

Sales Manager Institutional Sales

Export Sales Manager

Sales Personnel

Sales Personnel

Sales Personnel

Sales Personnel

THANK YOU