Sales Associate

CONTENTS Session 1: RETAIL INDUSTRY AN OVERVIEW 5 Session 2: RETAIL INDUSTRY CAREERS 7 Session 3: MARKETS 11 Session 4: RETAIL INDUSTRY BRANDS 17 Session 5: RETAIL Vs MARKETING - TERMS 22 Session 6: PRODUCTS 24 Session 7: STORE CLASSIFICATION 27 Session 8: STORE FORMATS 31 Session 9: RETAIL STORE MANAGEMENT 33 Session 10: DEPARTMENTS IN RETAIL STORE 37 Session 11: Asessment 38 Session 12: MERCHANDISE 39 Session 13: STORE LOCATION 42 Session 14: STORE LAYOUT 47 Session 15-16: STORE DESIGN 48 Session 17: SHELVES 49 Session 18: CLEANING SHELVES 51 Session 19: STACKING 52 Session 20: SPACE MANAGEMENT 55 Session 21: Field Visit 56 Session 22 - 23: DAILY COUNT AND INDENTS 57 Session 24: Field Visit 58 Session 25: Assessment - II 58 Session 26: SALES PROMOTION IN RETAIL 59 Session 27: LOGISTICS IN RETAIL 61 Session 28 - 29: BRANDING 62 Session 30: RECEIVING STOCKS 64 Session 31: PACKAGING 67 Session 32: LABELING 70 Session 33 - 34: PERSONAL SELLING 71

CONTENTS Session 35: Assessment - 3 73 Session 36: SALESMANSHIP 73 Session 37: QUALITIES OF A GOOD SALESMAN 76 Session 38 – 39: SALES PROCESS 80 Session 40 - 41: CUSTOMER 83 Session 42 - 43: TYPES OF CUSTOMERS 84 Session 44 -45: SALESPERSONS ATTITUDE 86 Session 46: QUESTIONING SKILLS 89 Session 47: PERSONAL HYGEINE 91 Session 48: GOODS HANDLING - VEGITABLES 92 Session 49: GOODS HANDLING - FRUITS 93 Session 50: Assessment 4 93 Session 51: GOODS HANDLING – SPICES AND STAPLES 94 Session 52: GOODS HANDLING – PROCESSED FOOD 96 Session 53: HOME CARE PRODUCTS 99 Session 54: PERSONAL CARE PRODUCTS 102 Session 55: Field Visit 103 Session 56: GENERAL MERCHANDISE 103 Session 57-58: CUSTOMER BEHAVIOUR 105 Session 59 - 60: SUGGESTIVE SELLING UP AND DOWN 108 Session 61: SALES TARGETS 110 Session 62: Assessment 5 112 Session 63: SHRINKAGE CONTROL 112 Session 64: SHOP LIFTING AND OTHER ISSUES 115 Session 65: HAZARDS IN RETAIL INDUSTRY 118 Session 66: FIRST AID ADMINISTRATION 120 Session 67: DEALING WITH EMERGENCIES 125 Session 68: DEALING WITH MANAGERS 129 Session 69 - 70: DEALING WITH DIFFICULT CUSTOMERS 134 Session 71: PROBLEMS OF A RETAIL SALESMAN 136

Session 1: RETAIL INDUSTRY AN OVERVIEW Retail is the sale of goods and services from individuals or businesses to the end-user. Retailers are a part of an integrated system called the supply chain. A retailer purchases goods or products in large quantities from manufacturers directly or through a wholesale, and then sells smaller quantities to the consumer for a profit. Retailing can be done in either fixed locations like stores or markets, door-to-door or by delivery. In the 2000s, an increasing amount of retailing is done online using electronic payment and delivery via a courier or postal mail. Retailing includes subordinated services, such as delivery. The term “retailer” is also applied where a service provider services the needs of a large number of individuals, such as for the public. Shops may be on residential streets, 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. Indian Retail Industry: India is being seen as a potential goldmine for retail investors from over the world and latest research has rated India as the top destination for retailers for an attractive emerging retail market. India’s vast middle class and its almost untapped retail industry are key attractions for global retail giants wanting to enter newer markets. Even though India has well over 5 million retail outlets, the country sorely lacks anything that can resemble a retailing industry in the modern sense of the term. This presents international retailing specialists with a great opportunity. The organized retail sector is expected to grow stronger than GDP growth in the next 5 years driven by changing lifestyles, burgeoning income and favorable demographic outline. 1. What is retail? 2. Shopping refers to a. Buying products. b. Buying goods c. Buying services d. All of the above 5 5 5 5 5 Customer Relation and Sales Student Work Book

3. B2C expansion ______________________________________________ 4. India has over _____________ Million retail outlets 5. Retailing can be done in either fixed locations like stores or markets, door-to-door or by delivery Yes / No INDUSTRY EVOLUTION Traditionally retailing in India can be traced to „ The emergence of the neighborhood kirana stores catering to the convenience of the consumers „ Era of government support for rural retail: Indigenous franchise model of store chains run by Khadi & Village Industries Commission „ 1980s experienced slow change as India began to open up economy. „ Textiles sector with companies like Bombay Dyeing, Raymond’s, S Kumar’s and Grasim first saw the emergence of retail chains „ Later Titan successfully created an organized retailing concept and established a series of showrooms for its premium watches „ The latter half of the 1990s saw a fresh wave of entrants with a shift from Manufactures to Pure Retailers. For e.g. Food World, Subhiksha and Nilgiris in food and FMCG; Planet M and Music World in music; Crossword and Fountainhead in books. „ Post 1995 onwards saw an emergence of shopping centers „ Mainly in urban areas, with facilities like car parking „ Targeted to provide a complete destination experience for all segments of society „ Emergence of hyper and super markets trying to provide customer with 3 V’s - Value, Variety and Volume „ Expanding target consumer segment: The Sachet revolution - example of reaching to the bottom of the pyramid. „ At year end of 2000 the size of the Indian organized retail industry is estimated at Rs. 13,000 crore Exercise 1. Following is a textile industry a. Kellogs b. Baskin Robins c. Subhiksha d. Bombay Dying 2. Following is a PharmaOutlet a. Kellogs b. Baskin Robins c. MedPlus d. Bombay Dying 3. Kirana stores cater to the convenience of the consumers Yes/No 4. Titan successfully created an organized retailing concept & established a series of showrooms for its premium watches Yes/No 6 6 6 6 6 Customer Relation and Sales Student Work Book

Session 2: RETAIL INDUSTRY CAREERS Retail management pertains to the task of managing supermarkets and hypermarkets in strict business terms. In India, the retail industry has seen a great upsurge in the past decade. From adopting new marketing strategies to diversifying into businesses, companies have tried all gimmicks to impress the customer. This is one industry that works clearly on the paradigm, “Customer is King”. The next time you enter a Reliance Fresh supermarket or a Big Bazaar to buy a commodity of your choice, try and analyze the various discount prices being offered. The systems these days are super-fast and dynamic and totally computerized. Unlike in the past where you had a grocery or a kirana shop selling you products and commodities at higher prices, now almost everything comes for a discount! It is the sale season for no proper reason! Right from factory outlets to supermarkets, some brand or the other would offer you discounts to beat and win the competition. Accordingly, retail management is a subject that requires you to be fully aware of brands, marketing strategies, and retail philosophies behind winning the customer. Retail management is the right or rather the best career for those who feel an interest towards commodities, sales markets, market segments, diversification of businesses, advertising and campaigning, and marketing research. The profession offers wide scope for exploring new companies that get introduced into the market and offer various products. You can start as an assistant retail manager and manage as store. You have to be dynamic and a team leader to succeed in the field. The job options in the retail field are quite interesting for a college graduate. You may start working as a sales executive or be directly employed as a sales manager or a marketing manager and even start a retail business of your own by becoming a franchisee of another big player in the retail business The demand for floor personnel and retail managers is always high. This is primarily because the supermarkets and hypermarkets business is ever expanding. Sometimes, start up retail chains select fresher’s from colleges or hire students for part-time jobs in order to handle customers who visit the market. The educational requirement sometime is limited to just a twelfth standard with pass marks! However, for students who have completed MBA in Retail management, the demand is more on the side of business research, market research, and pricing and strategizing perspective. The supply is optimal in India but there is always a huge demand for retail professionals. 7 7 7 7 7 Customer Relation and Sales Student Work Book

Careers in Retail Industry Careers in the retail industry are diverse and varied. You will be working with a wide range of people, so must enjoy engaging with others. Working in the retail industry is not just about being a sales assistant – it can provide you with lots of options for an interesting, long-term career with excellent prospects for progression. „ Sales Assistant „ Area/Regional Manager „ Buyer „ Department Manager „ Merchandise Planner „ Store Manager „ Visual Merchandiser Exercise 1. There is always a huge demand for retail professionals. Yes/No 2. Careers in the retail industry are diverse and varied. Yes/No 3. Customer is King Yes/No 4. Sales Assistant is a career in retail Yes/No Sales assistants in the retail industry can work in all types of retail outlets, from small specialty retailers to large department stores. Sales assistants are often required to work flexible hours, including late nights and weekends. The specific tasks performed by a sales assistant will vary according to the retailer they work for. As a retail sales assistant you will be responsible for: „ Assisting customers to locate merchandise and advising them on the price, use, and care of merchandise „ Developing detailed knowledge of products and services offered by the store to enable them to assist customers „ Advising customers on the features and benefits of products to assist them to make a purchase „ Assisting customers with returns of faulty or unwanted goods „ Operating cash registers or point of sale terminals to accept payment „ Wrapping and packaging goods for customers „ Arranging delivery, installation, service or repair of items „ Accepting deliveries and pricing stock „ Maintaining merchandise displays and the general neatness and appearance of the store „ Participating in stock taking, re-ordering and replenishing stock. 8 8 8 8 8 Customer Relation and Sales Student Work Book

Department Manager Department managers plan and coordinate the operations of departments or sections of larger retail outlets. This may include the recruitment and management of staff, sales and customer service, and managing sales targets and budgets. They are often also responsible for the visual presentation of the department and its merchandise. Department managers have contact with a wide range of people including customers, staff, suppliers and other department managers. Most retailers require people in management positions to already have experience working in retail, and some may provide additional training, either on the job or off the job. Retail Store Manager Store managers plan and coordinate the operations of retail outlets. This may include the recruitment and management of staff, sales and customer service, managing sales targets and budgets, and developing stock management procedures. They are often also responsible for the visual presentation of the store and its merchandise. Store managers have contact with a wide range of people including customers, staff, suppliers and other businesses. They work in a range of businesses including small retail outlets, supermarkets and food outlets, chain stores and department stores. Most retailers require people in management positions to already have experience working in retail, and some may provide additional training, either on the job or off the job. Visual Merchandiser Visual merchandisers design the merchandising plan for a store or group of stores, in order to maximise sales opportunities by attracting the attention of customers. They may develop individual displays such as window, wall or point of sale displays, and floor plans and layouts. These can range from simple product stands at cash registers to more elaborate and creative window displays. As well as attracting customers, displays can also project the image of the store and target specific groups of customers. Visual merchandisers usually work in consultation with others within an organisation, such as store staff and managers, marketing and promotions staff. Some visual merchandisers may also be involved in developing a merchandising plan for a group of stores, including a schedule of displays and promotions, and instructions for others to implement the merchandising plan. They may also work on the practical elements such as making props and organising lighting. 9 9 9 9 9 Customer Relation and Sales Student Work Book

Buyer Buyers source, select and purchase the goods that are sold in retail stores. They review current stock levels, sales patterns and their competitors’ ranges of stock to plan future stock. They can determine everything from stock levels to the product range. Keeping up to date with new products on the market is very important, and retail buyers need to do research and attend trade shows to keep ahead of future trends. This may involve travel to find the most suitable goods for the industry and for seasonal trends, sometimes interstate and overseas. Buyers often work with visual merchandisers and store managers to determine the best display and promotion methods for products to maximise sales. To support sales they also work with shop sales staff to develop their product knowledge. They may decide on product pricing, after being involved in negotiating purchase prices from suppliers. Merchandise Planner Merchandise planners assess, plan and predict stock needs for stores. They are responsible for increasing sales and profit by determining what products, and mix of products, stores should sell. To achieve this, they work with buyers, store managers and marketing staff to hit financial targets. In some stores the merchandise planner may also be known as a buyer. Career opportunities The retail industry is the largest employer of young people in India. More than 1,000,000 people are employed in the retail industry, and the industry is expected to continue to grow. In the retail industry, enthusiasm, hard work and performance are rewarded, and many employers in the industry offer opportunities for advancement from the shop floor. The most common role is in customer service or sales, as a sales assistant or cashier. However, the possibilities expand from there. Many people work their way up the ladder to management or supervisory positions, where they have responsibility for other staff members and the performance of the team. Other options include more specialised areas such as buying, merchandising, marketing, operations and human resources. Usually, these specialised roles are held by more experienced employees with specific skills and training in the area they will be working in. Exercise 1. Whom does a salesman serve to a. Salesmen b.Saleswomen c.Customers d.None of the above 2. Buyers often work with visual merchandisers and store managers to determine the best display and promotion methods for products to maximise sales. Yes/ No 3. Visual merchandisers design the merchandising plan for a store or group of stores Yes/ No 4. Store managers plan and coordinate the operations of retail outlets. Yes/ No 10 10 10 Customer Relation and Sales Student Work Book 10 10

Session 3: MARKETS An actual or nominal place where forces of demand and supply operate, and where buyers and sellers interact (directly or through intermediaries) to trade goods, services, or contracts or instruments, for money or barter. Types of physical markets „ Marketplace „ Bazaar „ Farmers’ market „ Flea market „ Floating market „ Grocery store „ Night market „ Street market „ Supermarket „ Street market, with stalls along one or more public streets Specialist markets „ Antique markets „ Handicraft markets „ Farmers’ markets, focusing on fresh food „ Fish markets Types of economic markets „ Agricultural marketing „ Emerging market „ Financial market „ Foreign exchange market „ Grey market „ Media market „ Niche market „ Prediction market „ Real estate market „ Stock market „ Wholesale marketing 11 11 11 Customer Relation and Sales Student Work Book 11 11

RECENT TRENDS „ Retailing in India is witnessing a huge revamping exercise as can be seen in the graph „ India is rated the fifth most attractive emerging retail market: a potential goldmine. „ Estimated to be US$ 200 billion, of which organized retailing (i.e. modern trade) makes up 3 percent or US$ 6.4 billion „ Multiple drivers leading to a consumption boom: o Favourable demographics o Growth in income o Increasing population of women o Raising aspirations: Value added goods sales „ Food and apparel retailing key drivers of growth „ Organized retailing in India has been largely an urban „ Phenomenon with affluent classes and growing number of double-income households. „ More successful in cities in the south and west of India. Reasons range from differences in consumer buying behavior to cost of real estate and taxation laws. „ Rural markets emerging as a huge opportunity for retailers reflected in the share of the rural market across most categories of consumption o ITC is experimenting with retailing through its e-Choupal and Choupal Sagar rural hypermarkets. o HLL is using its Project Shakti initiative ïn leveraging women self-help groups to explore the rural market. o Mahamaza is leveraging technology and network marketing concepts to act as an aggregator and serve the rural markets. „ IT is a tool that has been used by retailers ranging from Amazon.com to eBay to radically change buying behavior across the globe. „ E-tailing slowly making its presence felt. CHALLENGES & OPPORTUNITIES The organized retail sector in India has been witnessing various issues and challenges which are proving to be a hurdle for its fast-paced growth. Even though the organized retail sector is in a very nascent stage in India, it provides ample opportunities for retailers, and mitigation of a few challenges will help the sector attain higher economies of scale and growth. Elucidated below are the challenges and risks that the sector faces: „ Global economic slowdown „ Competition from the un organised sector „ Retail sector has no recognition as an industry „ High real-estate costs „ Lack of basic infrastructure „ Supply-chain inefficiencies „ Challenges with respect to human resources „ Margin Pressure 12 12 12 12 Customer Relation and Sales Student Work Book 12

Retailing has seen such a transformation over the past decade that its very definition has undergone a sea change. No longer can a manufacturer rely on sales to take place by ensuring mere availability of his product. Today, retailing is about so much more than mere merchandising. Its about casting customers in a story, reflecting their desires and aspirations, and forging long-lasting relationships. As the Indian consumer evolves they expects more and more at each and every time when they steps into a store. Retail today has changed from selling a product or a service to selling a hope, an aspiration and above all an experience that a consumer would like to repeat. For manufacturers and service providers the emerging opportunities in urban markets seem to lie in capturing and delivering better value to the customers through retail. For instance, in Chennai CavinKare, LimeLite, Maricos Kaya Skin Clinic and Apollo Hospitals Apollo Pharmacies are examples, to name a few, where manufacturers/service providers combine their own manufactured products and services with those of others to generate value hitherto unknown. The last mile connect seems to be increasingly lively and experiential. Also, manufacturers and service providers face an exploding rural market yet only marginally tapped due to difficulties in rural retailing. Only innovative concepts and models may survive the test of time and investments. Exercises 1. What is a market? 2.What are the different types of markets? 3.What is barter system? 13 13 13 13 Customer Relation and Sales Student Work Book 13

Challenges in Retail Industry: Retailing in India is currently estimated to be a US$ 200 billion industry, of which organized retailing makes up a paltry 3 percent or US$ 6.4 billion. By 2010, organized retail is projected to reach US$ 23 billion. For retail industry in India, things have never looked better and brighter. Challenges to the manufacturers and service providers would abound when market power shifts to organized retail. However, manufacturers and service providers will also increasingly face a host of specialist retailers, who are characterized by use of modern management techniques, backed with seemingly unlimited financial resources. Organized retail appears inevitable. Retail sector yet to be recognised as an industry The retail sector is not recognised as an industry by the government even though it is the second-largest employer after agriculture. Lack of recognition as an industry affects the retail sector in the following ways: „ Due to the lack of established lending norms and consequent delay in financing activity, the existing and new players have lesser access to credit, which affects their growth and expansion plans „ The absence of a single nodal agency leads to chaos, as retailers have to oblige to multiple authorities to get clearances and for regular operations High real estate costs Even though the real estate prices have subsided recently due to the slowdown in economies and the financial crises, these prices are expected to go up again in the near future. Presently the sector faces high stamp duties, pro-tenancy acts, the rigid Urban Land Ceiling Act and the Rent Control Act and time-consuming legal processes, which causes delays in opening stores. Earlier on the lease or rents on properties were very high (among the highest in the world) at some prominent locations in major cities. The profitability of retail companies were affected severely because real estate costs constituted a major part of their operating expenses. Now companies are moving out from prominent malls of tier I cities and are re-negotiating the rental agreements with landlords to reduce costs. Some are even focussing on setting up shops in tier II and tier III cities. Lack of basic infrastructure Poor roads and lack of cold chain infrastructure hampers the development of food retail in India. The existing players have to invest substantial amounts of money and time in building a cold-chain network. 14 14 14 14 Customer Relation and Sales Student Work Book 14

Supply-chain inefficiencies Supply chain needs to be efficiently-managed because it has a direct impact on the company’s bottom lines. Presently the Indian organised retail has an efficient supply chain but it appears efficient only when compared with the unorganised sector. On an international level the Indian organised retailers fall short of international retailers like Wal-Mart and Carrefour in terms of efficiencies in supply chain. Inventory management is the first challenge that retailers face at the local store level as well as at the warehouse level. Excess inventory often leads to an increase in inventory costs, and then to lower profits, so retailers like Pantaloons and Shoppers Stop have IT systems in place for inventory management. SCM-IT has helped retailers to plan their stock outs, replenish their stock on time, move stock from warehouse to stores, maintain adequate stock at a store to match consumer preferences etc. However, the retailer may still face a big challenge in terms of efficiently implementing the supply-chain software across stores and integrating it with the central warehouse, which can be a time-consuming process, requiring trained personnel. Logistics is another challenge related to the supply chain. It is imperative for any organised food and grocery retailer to establish a robust cold chain. Amul is the best example of this scenario, as it has developed a cold storage chain across India. Until and unless organised retailers like Reliance and Food Bazaar fully develop integrated-cold chains, they would continue to incur loss of considerable amount of money through wastages of perishable items while moving huge quantities from one place to another. The third challenge related to the supply chain is procurement. Big organised retailers enjoy economies of scale based on their size and expansion plans. The economic benefits of scale in procurement are achieved when procurement is made in thousands or millions of units; however, the main challenge here is to procure adequate amount of stock according to customer requirements, failing which the resultant rise in inventory can affect bottom lines. Challenges with respect to human resources The Indian organised retail players shell out more than 7% of sales towards personnel costs. The high HR costs are essentially the costs incurred on training employees as there is a severe scarcity for skilled labour in India. The retail industry faces attrition rates as high as 50%, which is high when compared to other sectors also. Changes in career path, employee benefits offered by competitors of similar industries, flexible and better working hours and conditions contribute to the high attrition. Shrinkage Retail shrinkage is the difference between the book value of stock and the actual stock or the unaccounted loss of retail goods. These losses include theft by employees, administrative errors, shoplifting by customers or vendor fraud. According to industry estimates, nearly 3- 4% of the Indian chain’s turnover is lost on account of shrinkage. The organised industry players have invested IT, CCTV and antennas to overcome the problem of shrinkage. 15 15 15 15 Customer Relation and Sales Student Work Book 15

Exercise: 1. What is shrinkage? 2. What is supply chain? 3. Do companies require supply chain? Yes / No 4. What are the measure for reducing shrinkage? 16 16 16 16 Customer Relation and Sales Student Work Book 16

Session 4: RETAIL INDUSTRY BRANDS Brand is the “name, term, design, symbol, or any other feature that identifies one seller’s product distinct from those of other sellers.” Brands are used in business, marketing, and advertising. Initially, livestock branding was adopted to differentiate one person’s cattle from another’s by means of a distinctive symbol burned into the animal’s skin with a hot branding iron. A modern example: Coca-Cola. In accounting, a brand defined as an intangible asset is often the most valuable asset on a corporation’s balance sheet. Brand owners manage their brands carefully to create shareholder value, and brand valuation is an important management technique that ascribes a money value to a brand, and allows marketing investment to be managed (e.g.: prioritized across a portfolio of brands) to maximize shareholder value. Although only acquired brands appear on a company’s balance sheet, the notion of putting a value on a brand forces marketing leaders to be focused on long term stewardship of the brand and managing for value. The word “brand” is often used as a metonym referring to the company that is strongly identified with a brand. Marque or make are often used to denote a brand of motor vehicle, which may be distinguished from a car model. A concept brand is a brand that is associated with an abstract concept, like breast cancer awareness or environmentalism, rather than a specific product, service, or business. A commodity brand is a brand associated with a commodity Retail brands in India This country has got outlets of many of the famous national as well as international retail brands. Day by day, the increasing organized lifestyle of the residents of the country of India is leading to the setting up of more retail outlets in the nation. However, Indian retail market is said to be a bit unorganized. Much more stress on selling brands is required from the retailers. With involvement of some of the renowned business tycoons like Goenka, Piramal, Raheja and Tata, several supermarkets, stores for office equipment’s, self-service stores and many such stores have been set up in the country. In a very short period of time, the Indian retail industry has witnessed the establishment of numerous retail outlets. In this present competitive market, all of the retail brands try hard to contend each other in terms of core competencies as well as branding strategies. Characterized with consistency, legitimacy, popularity and value addition, the different retail brands available in the country aims at establishing a long lasting relationship with customers as well as one to one marketing. 17 17 17 Customer Relation and Sales Student Work Book 17 17

Exercise: 1. What is brand? 2. List some of the brands. 3. List some of the Indian brands 18 18 18 18 Customer Relation and Sales Student Work Book 18

Top Retail brands in India Following are some of the best retail brands in India: Bharti - Walmart: With a plan of creating a network of retailing with a capacity of including U. S. $ 7 billion investment, this brand retailer has got 100 hypermarkets along with innumerable small stores. They run their retailing with a joint venture of 50:50 ratios with Walmart, where the latter deals with the cash and carry whereas, Bharti group does the work related to front end. K. Raheja Group: Starting the retail business initially with Shopper’s Stop, one of the famous brands, this is the sole Indian retailer to become a part of the prestigious I. G. D. S. (Intercontinental Group of Departmental Stores). Presently some of the renowned retail brands of this group are as follows: Crossword: A branded book store. Homes Stop: A retail store dedicated to home solutions Shopper’s Stop: The 1st departmental store in India, which was started in the year 2001. Apart from these, this group has even got a joint business with the Nuance Group in the field of Airport Retailing as well as a plan forgetting involved in internet and catalogue retailing. Setting up of 55 hypermarkets all over India is in the pipeline. Pantaloons: Headquartered in the city of Mumbai, this is the largest retail brand in India. Operating from 450 stores located all over the country of India, this mostly favored retail brand has got the following divisional outlets: Big Bazaar and Food Bazaar for food items and grocery Collection - I, Furniture Bazaar, Hometown for home solutions Crossroads, which has recently been bought by Pantaloons Depot for books, gifts and music E-zone for consumer electronic goods Shoe Factory for shoes 19 19 19 19 Customer Relation and Sales Student Work Book 19

Recently, they have even introduced small shops for e-commerce, where 40 digital screens will be placed in a 150 sq. ft. store, which will help the customers to browse their requirements and place the order accordingly. They will get those items delivered to the house of the customer within a few hours from placing the order. Reliance: This retail brand introduces most ambitious plans in the Indian retail industry from time to time. Apart from the 1st Reliance Hypermart situated in the city of Ahmedabad, this brand has got above 300 stores of Reliance Fresh across the country. R. P. G. Group: Being the first entrant in the field of organized grocery and food, this group established their first store of Foodworld in the year 1996. Presently, they have got several outlets of one of the most popular retail brands, Spencer’s, who specializes in providing fresh vegetables and fruit, grocery and food items, personal care goods, electrical and electronics, office and home essentials, garments as well as fashion accessories and many more. Subhiksha: This decade old retail brand is mainly based in Chennai in the southern part of the country of India. Their 500 retail stores are spread all over the country, which gained its fame as a chain of discount retail industry. Tata group: Trent, one of the Tata Group’s subsidiaries was set up in the year 1998. Two of the most famous brand outlets of this group are: Croma that is a retail chain of consumer electronic goods Landmark, the largest music and book retailer which was acquired by this group in 2005 Star India Bazaar that is a hypermarket offering an array of low priced products Tanishq, which is a well-known jewelry brand in India Titan that is a famous watch brand Westside, which is a retail chain of lifestyle goods To name a few more retail brands in India are: „ Allen Solly „ Barista „ Cafe Coffee Day „ Louis Phillipe „ McDonalds „ Music World „ Peter England „ Provogue „ Van Heusen 20 20 20 20 Customer Relation and Sales Student Work Book 20

Case Study Nestlé India Ltd. (NIL), the Indian subsidiary of the global FMCG major, Nestlé SA, introduced the Maggi brand in India in 1982, with its launch of Maggi 2 Minute Noodles, an instant noodles product. With the launch of Maggi noodles, NIL created an entirely new food category - instant noodles - in the Indian packaged food market. Because of its first-mover advantage, NIL successfully managed to retain its leadership in the instant noodles category even until the early 2000s. Over the years, NIL extended the Maggi brand to a variety of culinary products like soups, sauces and ketchups, and cooking aids among others. However, these product extensions were not as successful as the instant noodles. In 2005, NIL started offering a range of new ‘healthy’ products under the Maggi brand, in a bid to attract health-conscious consumers. Exercise 1. What did you understand from Maggi Case Study? 21 21 21 21 Customer Relation and Sales Student Work Book 21

Session5: RETAIL Vs MARKETING - TERMS Bill of Lading: it is a document used as evidence that a transport company or carrier received goods from a shipper. Break-even Point: The point in business where the sales equal the expenses. There is no profit and no loss. Cash Discount: A percentage reduction in price for payment within a specified period of time. Chain Store: One of a number of retail stores under the same ownership and dealing in the same merchandise. Coupon: A promotional tool in the form of a document that can be redeemed for a discount when purchasing goods or services. Coupons feature specific savings amount or other special offer to persuade consumers to purchase specific goods or services or to purchase from specific retailers. CRM - Customer Relationship Management: Customer relationship management (CRM) is a business strategy designed to reduce costs and increase profitability by strengthening customer loyalty. Department Stores: Retailers that carry a broad variety and deep assortment, offer considerably good customer service, and are organized into separate departments for displaying merchandise. Discount Stores: Retailers that offer low prices and low customer service. First In, First Out: A method of stock rotation in which goods that are received first are sold first. Newly received product is stocked behind the older merchandise Gondola: Primary merchandising fixture consisting of a base, free-standing vertical wall, and a number of four of sections of shelving. Inventory: Inventory is the merchandise a retail store has on hand. The term also refers to the act of counting, itemizing and recording in-stock merchandise or supplies. Kiosk: The term kiosk, as related to retailing, refers to a small stand-alone structure used as a point of purchase. This can be either a computer or display screen used to disseminate information to customers; or a free standing, full-service retail location. Kiosks are often found in malls and other high-traffic locations. Margin: The amount of gross profit t made when an item is sold. 22 22 22 Customer Relation and Sales Student Work Book 22 22

Plan-o-gram: Visual description,diagram or drawing of a store's layout that includes placement of particular products and product categories. Point-of-purchase Display: Point-of-purchase displays, or POP displays, are marketing materials or advertising placed next to the merchandise it is promoting. These items are generally located at the checkout area or other location where the purchase decision is made. For example, the checkout counters of many convenience stores are cluttered with cigarette and candy POP displays. Point of Sale (POS): Point of sale (POS) refers to the area of a store where customers can pay for their purchases. The term is normally used to describe systems that record financial transactions such as electric cash registers or an integrated computer system that records the data that comprises a business transaction for the sale of goods or services. Purchase Order: A purchase order (PO) is a written sales contract between buyer and seller detailing the exact merchandise or services to be rendered from a single vendor. Quantity Discount: A reduction in price based on the amount purchased. May be offered in addition to any trade discount. Retailing: The sale of goods or commodities in small quantities directly to consumers. Shrinkage: Retail shrinkage is a reduction or loss in inventory due to shoplifting, employee theft, paperwork errors and supplier fraud. Specialty Stores: Retailers that concentrate on a limited number of complementary merchandise categories and provide a high level of customer service in an area typically less than 8000 square feet. Visual Merchandising: Visual merchandising is the art of implementing effective design ideas to increase in-store traffic and sales volume. Wholesale: Wholesale is the sale of goods, generally in large quantity, to a retailer for resale purposes. 23 23 23 23 Customer Relation and Sales Student Work Book 23

Session 6: PRODUCTS In marketing, a product is anything that can be offered to a market that might satisfy a want or need. In retailing, products are called merchandise. In manufacturing, products are bought as raw materials and sold as finished goods. Commodities are usually raw materials such as metals and agricultural products, but a commodity can also be anything widely available in the open market. In project management, products are the formal definition of the project deliverables that make up or contribute to delivering the objectives of the project. In insurance, the policies are considered products offered for sale by the insurance company that created the contract. In economics and commerce, products belong to a broader category of goods. The economic meaning of product was first used by political economist Adam Smith. A related concept is sub-product, a secondary but useful result of a production process. Dangerous products, particularly physical ones that cause injuries to consumers or bystanders may be subject to product liability. Sometimes revered to a thing. Types of products: a. Consumer Products b. Shopping Products c. Speciality Products d. Unsought Products e. Business Products Product Classification: A product can be classified as tangible or intangible. A tangible product is a physical object that can be perceived by touch such as a building, vehicle, gadget, or clothing. An intangible product is a product that can only be perceived indirectly such as an insurance policy. 24 24 24 Customer Relation and Sales Student Work Book 24 24

Product Classification: A product can be classified as tangible or intangible. A tangible product is a physical object that can be perceived by touch Examples of a tangible product include cars, food items, computers, telephones, etc. Many businesses also need to provide packaging for a tangible product to provide protection during its transportation to a retail location. On the other side of this are Intangible goods which are products that cannot be seen or touched. Things like domain names or computer programs are intangible goods. Even music you download from the web is considered intangible even though if you buy the CD it would be tangible. An intangible product is a product that can only be perceived indirectly such as an insurance policy. Case Study Kellogs: In April 1995, Kellogg India Ltd. (Kellogg) received unsettling reports of a gradual drop in sales from its distributors in Mumbai. There was a 25% decline in countrywide sales since March1995, the month Kellogg products had been made available nationally. Kellogg was the wholly-owned Indian subsidiary of the Kellogg Company based in Battle Creek, Michigan. Kellogg Company was the world’s leading producer of cereals and convenience foods, including cookies, crackers, cereal bars, frozen waffles, meat alternatives, piecrusts, and ice cream cones. Founded in 1906, Kellogg Company had manufacturing facilities in 19 countries and marketed its products in more than 160 countries. The company’s turnover in 1999-00 was $ 7 billion. Kellogg Company had set up its 30th manufacturing facility in India, with a total investment of $ 30 million. The Indian market held great significance for the Kellogg Company because its US sales were stagnating and only regular price increases had helped boost the revenues in the 1990s. 25 25 25 25 Customer Relation and Sales Student Work Book 25

Launched in September 1994, Kellogg’s initial offerings in India included cornflakes, wheat flakes and Basmati rice flakes. Despite offering good quality products and being supported by the technical, managerial and financial resources of its parent, Kellogg’s products failed in the Indian market. Even a high-profile launch backed by hectic media activity failed to make an impact in the marketplace. Meanwhile, negative media coverage regarding the products increased, as more and more consumers were reportedly rejecting the taste. There were complaints that the products were not available in many cities. According to analysts, out of every 100 packets sold, only two were being bought by regular customers; with the rest 98 being first-time buyers. Converting these experimenters into regular buyers had become a major problem for the company. By September, 1995, sales had virtually stagnated. Marketing experts pointed out various mistakes that Kellogg had committed and it was being increasingly felt that the company would find it extremely difficult to sustain itself in the Indian market. The Mistakes Kellogg realized that it was going to be tough to get the Indian consumers to accept its products. Kellogg banked heavily on the quality of its crispy flakes. But pouring hot milk on the flakes made them soggy. Indians always boiled their milk unlike in the West and consumed it warm or lukewarm. They also liked to add sugar to their milk. or lukewarm.They also liked to add sugar to their milk. When Kellogg flakes were put in hot milk, they became soggy and did not taste good. If one tried having it with cold milk, it was not sweet enough because the sugar did not dissolve easily in cold milk. The rice and wheat versions did not do well. In fact, some consumers even referred to the rice flakes as rice corn flakes. In early 1996, defending the company’s products, Managing Director Avronsart said, “True, some people will not like the way it tastes in hot milk. And not all consumers will want to have it with cold milk. But over a period of time, we expect consumer habits to change. Kellogg is a past master at the art, having fought - and won - against croissant-and-coffee in France, biscuits in Italy and noodles in Korea.” A typical, average middle-class Indian family did not have breakfast on a regular basis like their Western counterparts. Those who did have breakfast, consumed milk, biscuits, bread, butter, jam or local food preparations like idlis, parathas etc. According to analysts, a major reason for Kellogg’s failure was the fact that the taste of its products did not suit Indian breakfast habits. Kellogg sources were however quick to assert that the company was not trying to change these habits; the idea was only to launch its products on the health platform and make consumers see the benefit of this healthier alternative. 26 26 26 26 Customer Relation and Sales Student Work Book 26

Session 7: STORE CLASSIFICATION The retailer has to get the right assortment of products in the store in an efficient way, arrange the products in a way that stimulates purchase and minimizes inconvenience for customers, and manage a group of friendly and effective salespersons. Consumer decision making involves the choice of brands, and also the choice of retail outlets from where the customer will buy his chosen brands. It may also happen that a customer decides to buy from a particular retail format, and then buys from among the brands that the retail format stocks. Most customers buy in physical retail stores of various types having various product assortments and levels of service, but non-store retail formats such as mail order, automatic vending and Internet sales account for large amount of sales, especially in developed countries. In developing countries, these formats are slowly finding acceptance now. Retailing makes products available when and where customers want to buy them. Retailing is becoming international in nature and is slowly emerging as an important service. Classification of Retail Formats: There are many types of retail formats like discount stores, supermarkets, convenience stores, department stores, etc. These retail store formats vary from each other on the basis of their product assortment (product depth and width), price and location. 1. Product Factors: Retail store formats can be classified on the basis of the number of products sold by the retailer and the range of products in each category. Hypermarkets: Narrow and Deep Product Assortment: The store has one product category or a very narrow, related range of products. The store however stocks large amount of variety of these products. The variety available in this store format is unparalleled and is the competitive criteria among these stores. 27 27 27 Customer Relation and Sales Student Work Book 27 27

These are sometimes called specialty stores. The price range in these stores could either be narrow, catering to a specific market segment, or it could be broad covering a large number of segments. Product categories in which this format is popular are footwear, clothing, furniture and furnishing. As the economy of a country develops, people will want more sophistication and variety in greater number of categories and this can be provided only in this type of format. This format can afford specialization of retail personnel which will be necessary in handling customers’ enquiries as categories develop. Some specialty stores have a very limited number of product categories (typically one) and the complete range in that category is available under one roof. These stores can afford lower prices because of their influence on the manufacturers as they sometimes control the market of the category. For instance, IKEA is one such store that stocks every type of furniture, in all price ranges and usage. Called category killers, these stores eliminate competition in the specified category. Wide and Shallow Product Assortment: The store has a number of products, but stocks a limited variety of all these goods. The store usually stocks related items, for instance, lifestyle goods for the whole family that include clothes, books, home decor, jewellery, cosmetics, accessories, stationary, toys, etc. For instance, in India, Ebony Shopper’s Stop are such stores. This store format is gaining wide acceptance in India as the store acts as a one- stop-shop for the complete family. Usually such stores are also accompanied by food joints and entertainment plazas that provide an ideal day out. Such formats always face a conflict between the number of product categories they should store and the range in each category. If the number of product categories is large, chances are that the range in each one of them would be smaller because of space constraints or else it may become too unwieldy. But this arrangement will leave a lot of customers dissatisfied as they may find the range too limited. The other option is to have limited product categories and a wide range in each one of them. But this will reduce the number of occasions that the customer will find a reason to walk into the store. These store formats will ultimately be targeted to specific segments. One such store targeted towards the up market will stock premium brands in all categories, whereas the down-market store will stock popular or less premium brands. 28 28 28 28 Customer Relation and Sales Student Work Book 28

The evolution of hypermarkets has resulted in wider and deeper product assortments for customers. These retail formats are characterized by very large retail spaces that are leased out to various brands. These huge retail formats have many single brand stores in many of the product categories. The choice of the brands offered conveys the depth of the category, image of the store and reflects the intended target market. Excercises: What are Hypermarkets? What is a store format? 2. Location Factors: One specific type of specialty store is the grocery store or the chemist, whose critical factor for success is the proximity to the customer. These stores operate in those product categories for which the customer desires convenience of location. The products may be urgently required like medicines. Some of these products, like grocery items, vegetables and fruits, have to be bought frequently as they would be spoiled if they were stored for a long time. The importance of a store’s proximity to customers has not waned even with improvement in transportation and more families owning vehicles because, in most households, both husbands and wives are working longer hours. Purchasing for the household is done only during weekends. Such families need nearby stores when they have to purchase fresh grocery items during the weekdays. Therefore such stores should stock only those items whose purchases the family cannot postpone till the weekend. These stores can have arrangement to deliver the items on a regular basis to the households. Families make major purchases for the household during the weekend. But they often combine the purchasing of supplies with an entertainment trip. The family would watch a movie and buy its supplies on a common trip. 29 29 29 29 Customer Relation and Sales Student Work Book 29

For such excursions, location of stores is not important in terms of proximity to customers. Proximity to customers may even become a liability, because for most people, the idea of entertainment is not walking into the theatre or restaurant which is next door. Customers would like to travel some distance for their weekend trips. But location still remains important. The store has to be located at places where the customers are most likely to visit during their weekends. Shopping and entertainment have to be packaged together for customers who do not have the time to shop during weekdays. 3. Price Factors: Some retail stores may charge normal or list prices, while some may charge lower than list prices on a regular basis. Retail stores that offer products on the list price do not give discounts on a regular price, though they engage in promotions. All the stores mentioned above charge list prices from their customers. But there are stores called discount stores which sell products at low prices daily. They can do this by bulk buying, accepting low margins, managing costs tightly and choosing locations where real estate prices are low. These discount stores get price concessions from manufacturers because of the high offload from these stores. Exercises: 1.Families make major purchases for the household during the weekend. Yes/No 2. Purchasing for the household is done only during __________ 3. The retail outlets must be ______________ to households 30 30 30 30 Customer Relation and Sales Student Work Book 30

Session 8: STORE FORMATS RETAILING FORMAT IN INDIA Malls:The largest form of organized retailing today. Located mainly in metro cities, in proximity to urban outskirts. Ranges from 60,000 sq ft to 7,00,000 sq ft and above. They lend an ideal shopping experience with an amalgamation of product, service and entertainment, all under a common roof. Examples include Shoppers Stop, Piramyd, and Pantaloon. Specialty Stores:Chains such as the Bangalore based Kids Kemp, the Mumbai books retailer Crossword, RPG’s Music World and the Times Group’s music chain Planet M, are focusing on specific market segments and have established themselves strongly in their sectors. Discount Stores:As the name suggests, discount stores or factory outlets, offer discounts on the MRP through selling in bulk reaching economies of scale or excess stock left over at the season. The product category can range from a variety of perishable/ non-perishable goods. Department Stores:Large stores ranging from 20000-50000 sq. ft, catering to a variety of consumer needs. Further classified into localized departments such as clothing, toys, home, groceries, etc. Departmental Stores are expected to take over the apparel business from exclusive brand showrooms. Among these, the biggest success is K Raheja’s Shoppers Stop, which started in Mumbai and now has more than seven large stores (over 30,000 sq. ft) across India and even has its own in store brand for clothes called Stop. Exercise 1. What is Department store? 2. What is a specialty store? 31 31 31 Customer Relation and Sales Student Work Book 31 31

Hyper marts/Supermarkets:Large self-service outlets, catering to varied shopper needs are termed as Supermarkets. These are located in or near residential high streets. These stores today contribute to 30% of all food & grocery organized retail sales. Super Markets can further be classified in to mini supermarkets typically 1,000 sq ft to 2,000 sq ft and large supermarkets ranging from of 3,500 sq ft to 5,000 sq ft. having a strong focus on food & grocery and personal sales. Convenience Stores:These are relatively small stores 400-2,000 sq. feet located near residential areas. They stock a limited range of high-turnover convenience products and are usually open for extended periods during the day, seven days a week. Prices are slightly higher due to the convenience premium MBOs:Multi Brand outlets, also known as Category Killers, offer several brands across a single product category. These usually do well in busy market places and Metros. Exercise: 1. Size of a store is measured in a. Feet b. Square feet c. Meters d. None of the above 2. MBO stands for ________________________________________ 3. Retail stores are open 7 seven days a week Yes / No 4. Convenience stores are small stores Yes / No 32 32 32 32 Customer Relation and Sales Student Work Book 32

Session 9: RETAIL STORE MANAGEMENT The job of a retail store manager is to oversee and thus ensure smooth running of the store. Some of the key retail services performed by a store manager are: meeting sales and personal targets, ensuring customer satisfaction via maximizing the shopping experience of customers; managing all aspects of store operations in order to ensure maximum sales as well as profit; etc. Retail management also includes focusing on key initiatives in business, daily cost control in operations, risk management, payroll management, loss prevention, inventory management, marketing execution, and store presentation. Retail store managers should have organizational skills which includes the ability of paying attention to detail as well as following-up matters. The job also involves the capability of managing multiple priorities along with management skills like communication, recruiting, training, and coaching. 15 Tips to Fine-tune Retail Store Management 1. The customer is always right:Yes, that age-old saying holds true even today. The customer is the most important facet of any business. Hence, as a retail store manager you need to ensure that the whole team comprehends that the customer is their top-most priority, that the customer should be satisfied with the goods and service you provide, and that you never challenge the customer! The customer is ALWAYS right! 2. Make the customer feel special:Everybody likes feeling special. So, when you are with a customer, give him or her your exclusive attention, listening closely to whatever they may be saying to you. During that time don’t let anything else interrupt you. You may even go so far as making a flattering comment or two. If it is a clothes store, compliment the customer after he/she tries on something; if it is a food store, give them tips regarding which product is healthier, etc. You may also inquire about their work to be able to suggest them suitable options from your store. 3. Please the customer:Although this is often touted, it is seldom practiced! As a retail store manager, see to it that the sales staff does that extra bit to make the customer feel pleased, especially as a measure of calming their displeasure about something. For instance, some special store giveaways can be packed with their purchases, or you may handout a discount coupon. You may even offer refreshments. 4. Deliver more than what you promise:The difference in “promise less but deliver more” and “deliver more than you promise” is that of attitude. If you promise less, you may come across as playing a safe game. You may lose your customer to someone who promises more. But if you promise more and deliver even more, the customer is bound to come back to you! It is the gesture that counts. By giving more than whatever you may have promised, you can build a strong customer rapport, both inside as well as outside the store. 33 33 33 Customer Relation and Sales Student Work Book 33 33

5. Appearances do matter: Although you may dismiss it as a superficial aspect of a superficial consumerist society, there is no escaping the fact that the first impressions of your store is going to be the last impression! So make sure you make a good first impression. This includes a smiling, enthusiastic and well dressed staff, a clean and easy to makeover around store, and a positive and happy ambiance. Avoid loud music, and complicated arrangement and/or presentation of goods. 6. Display merchandise attractively:A vital part of management is seeing to it that the merchandise is displayed properly; this means in an uncomplicated, easy-to-find and yet attractive manner. If the items are not displayed or seen properly, they won’t be sold in the numbers that they ought to be. Merchandise should look crisp and new at all times. If the items are shop-worn, they should be put in the bargain section. Items that are usually bought on impulse should be placed on display close to the cash out area (play on the psyche of your customers). Also, appropriate sections should be made for merchandise, and the items should be placed in the correct sections. Items that are similar in nature should be placed in the same area. 7. Items should be shown to advantage:Apart from displaying merchandise attractively, you, as a retail store manager, should also make sure that the items are placed in such a way that they draw the customer’s attention. Hiding or stacking merchandise will not attract the attention of the customer. When thinking about how to display items, try to imagine what the customers will view with the display. Placing merchandise at eye level, or a little lower than that, is the best way to display specials. Placards and signs are also another method of grabbing the eye of the customer. Exercise: 1.The customer is ALWAYS right! Yes / No 2. First impression is the best impression Yes / No 3. Merchandise must not be kept at eye level Yes / No 4.Avoid loud music, and complicated arrangement and/or presentation of goods. Yes / No 5.Merchandise should look crisp and new at all times. Yes / No 34 34 34 Customer Relation and Sales Student Work Book 34 34

8. Get rid of unsold merchandise: The bottom 10 to 20 percent of the product lines should be gotten rid of every year to be replaced by new products. The product lines that are not selling well should be marked down to half their price in order to sell them off fast. You can even put the less selling items in the bargain section. You may even come up with store offers, like Buy One Get One Free, or something like that. 9. More floor space: Make sure that your store has ample floor space for customers to move about easily without knocking something off a shelf! The shelves in themselves too should be less cluttered. Definitely a store with easy shopping areas will attract more buyers and will hence make more sales rather than a stuffed, cluttered store. Organize your store in such a way that the customers will not have to hunt for what they want. They should be able to walk in, walk up to the shelf, pick their stuff off it, and walk to the billing area, all on their own! 10. Timely ordering of inventory: This is another important aspect of a retail store manager’s duties. The levels of inventory should be monitored and kept in adequate amounts at all times. If customers do not find what they are looking for, they will just go to another store. Your inventory should be such that a customer should never leave your store empty- handed. If at all it ever happens, the incident should not repeat! 11. Hire the right people: A retail manager’s success is largely dependent on the kind of people he/she helps to hire. The staff that is hired has to have the ability of making a quantifiable and meaningful contribution to the store’s performance. In order to be able to rise in the organization, the store manager has to draw the attention as well as the recognition of the top management. The correct people will help in showcasing their talents while they achieve their objectives. Make sure you motivate them to always deliver their best. 12. Training the staff:Hiring the right kind of people and keeping them motivated is only a part of a retail store manager’s path to success. The main part of a manager’s job is to train the staff so that they are aware of what is expected of them. This will ensure that all the people involved in the success of the store move in the same direction. 13. Incorporating time management skills:After hiring the right people, training them fully, and getting them ready to achieve success, the next thing a retail store manager has to take care of is managing their time along with the changing priorities they have to deal with each day. This is especially true in case of SALE periods and during holidays, when the store may have an unusual amount of rush. Your staff should be trained enough to handle large number of customers without making mistakes or getting overwhelmed! Efficiency is the key. 35 35 35 35 Customer Relation and Sales Student Work Book 35

14. Long range planning: Long range planning to ensure that every hour of every day in a week is managed effectively is another important part of the manager’s job. The skill of long range planning is what will be appreciated by the higher authorities, for they look for people who have the ability of looking forward, and creating concrete plans, in order to increase the business. A retail manager who can accomplish this will rise in the organization. A bird’s eye- view is crucial! 15. Retail software: These days, there is a lot of retail software available which provide scalability, data integrity, stability, and speed, thus offering a complete retail management solution, which can be adapted according to each type of doing business. From inventory management to Point Of Sale (POS) ticket entry, customer tracking, integrated purchasing, and monitoring the movement of merchandise, retail software provides all the capabilities required to run a retail store business more effectively and efficiently. Exercise 1. POS means _______________________________ 2. Organize your store in such a way that the customers will not have to hunt for what they want. Yes / No 3. Bottom 10 to 20 percent of the product lines should be gotten rid of every year to be replaced by new products. Yes / No 36 36 36 36 Customer Relation and Sales Student Work Book 36

Session 10: DEPARTMENTS IN RETAIL STORE Retailing Structure The following is a brief outline of some of the divisions in a retail organization. „ Owner/CEO or President „ Store Operations: Management, Cashier, Sales, Receiving, Loss Prevention „ Marketing: Visual Displays, Public Relations, Promotions „ Merchandising: Planning, Buying, Inventory Control „ Human Relations: Personnel, Training „ Finance: Accounting, Credit „ Technology: Information Technology As the store grows and the retail business evolves, the dynamics of the organization’s structure will change too. Therefore it is paramount to redesign the store’s organizational chart to support the decision-making, collaboration and leadership capabilities that are essential during and after a growth period. Exercise What are the major departments in a retail store Other Common Departments There are many different departments in most retail stores. Some of them frequently staffed like the jewelry department, some that most often go unstaffed except when customers need help, such as the department. Other departments, like the health and beauty departments, might or might not have staff on hand depending on the type of department store that you are shopping in and the level of customer service at the department store itself. Here are some other common retail departments: 37 37 37 37 Customer Relation and Sales Student Work Book 37

„ Some department stores also now include a pharmaceutical department, wherein they actually sell prescription medications to people who need them, all in one convenient place. This kind of job requires a relevant degree, and is not the kind of job that you can apply for and learn while you are working. „ The health and beauty departments are full of products that make people either happier or feel better, both of which tend to create grateful and pleasant customers. At chain discount stores, this section will include shampoos and soaps, while in larger department stores this section will include perfume and make-up. „ Usually found near the tools or the electronics departments, most department stores have an appliances section. Working in appliances is usually on commission plus salary, although it depends on your specific store. „ Some stores have a toy department. However, if you really want to work in toys, check out a store that is specifically made to sell them. „ Home departments are common. Some stores even split “home” up by room to include departments for kitchen, bedding, bathroom, and so forth. „ Another typical department, usually found near the home or electronics departments, is the office supplies department. Office supplies might include things like paper and pens, but some stores have rather large office supply departments that include things like printers, fax machines, and office furniture. „ Craft departments are common in discount chain stores such as Kmart, or you can get a job in a craft superstore that specializes in crafting supplies. Within these large crafting stores, you’ll find departments like floral, beading, paint, and framing. „ Although some stores combine it with their tool department, the outdoor department (or sports department) can be its own separate part of the store. Here, you’ll sell sports equipment, hunting and fishing gear, and items for your yard and deck. In short, if you can buy it, there’s a department for it! Some stores have even more specialized departments - it depends on each specific store Session 11: ASESSMENT 38 38 38 Customer Relation and Sales Student Work Book 38 38

Session 12: MERCHANDISE In the broadest sense, merchandising is any practice which contributes to the sale of products to a retail consumer. At a retail in-store level, merchandising refers to the variety of products available for sale and the display of those products in such a way that it stimulates interest and entices customers to make a purchase. In retail commerce, visual display merchandising means merchandise sales using product design, selection, packaging, pricing, and display that stimulates consumers to spend more. This includes disciplines and discounting, physical presentation of products and displays, and the decisions about which products should be presented to which customers at what time. Some of the merchandising tips are: 1. Change your displays monthly. Holidays and seasons only last so long, and promotional goods have a short shelf life. Feature new arrivals first. If you ordered merchandise meant to go together, keep it together. You don’t want its first appearance to be diluted. Later, the few items that may be left can be grouped with new arrivals to give them a new look. If you ordered red Valentine candles from one vendor, mugs from another, and teas form another, wait for them all to arrive. Don’t put the candles out first as a sole item and lose the potential add-on-sale. 2. Show off the wants. Don’t choose to highlight products the customer already needs; those are what they are coming in for. A customer responds to things they want. For example, don’t display the cheap hand mixer when the fancy KitchenAid is what every Emeril wannabe desires. Just because they need a mixer, doesn’t mean they won’t treat themselves to the expensive model if it is displayed well. 3. Look for one thing that makes a group. All of one product works well in a grocery store, but it is little more than warehousing the items in a retail store. Arrange by product use — all items related to brewing and drinking tea, for example. Or display by color — the strongest color combinations to attract attention in retail are red, white, and black. Try related or contrasting colors. Our eyes quickly get the point and move on, so never make a monochromatic display. 39 39 39 Customer Relation and Sales Student Work Book 39 39

4. Start closest to the door. Start with the display area closest to the front door and put your newest and most expensive items in the spotlight. Be sure to have several levels of height and enough products so that the customer can pick up and touch without having to totally dismantle your display. 5. Pig in the window. Find a totally unrelated item and put it in your display. It serves as a prop, its only purpose to grab your customer’s attention. Add a stuffed toy pig to complete your Kitchen aid display. It is not necessary to add a prop to every display, but the idea should always be there. The display in the picture shows the green bottles as the pig in the window. They make the customer ask themselves, “Why is that there?” They are intrigued and come in to learn more. 6. Showtime. Light your display like it’s important. Adjust overheard lighting. If you have particularly dark display with no way to highlight it from above, consider moving it to an existing light source or light form below with small spot lights. Remember, light makes the merchandise pop. 7. Put words to it. Add a few well-placed, well-worded signs. Make sure they are short and easy to read. If your customers are mostly seniors, make it easy on them by using larger fonts. Handwritten signs with markers are okay for a kid’s lemonade stand, but anywhere else they tend to look amateurish. Don’t ever put up a sign that says DO NOT TOUCH. You might as well put up a sign that says DO NOT BUY. Displays are supposed to get messed up. Exercise: What is a merchandise? 8. Rotate them. Move existing displays around in the store when new merchandise comes in. Since the fairly new products will still be selling, switch your displays two weeks after their arrival. Move one from the front to the middle of the store and the other from the middle to the back. 9. Track it. Monitor your computer printouts and inventory levels weekly. If something really takes off, be prepared to reorder immediately. If you have sold through your inventory and you have no back stock, change your visual merchandising plan to something you have plenty of. If something doesn’t sell, try moving the same display to another location before giving up on it. 40 40 40 40 Customer Relation and Sales Student Work Book 40

10. Tag it. Make sure all of your stock is priced. No one wants to have to ask how much something is. These are by no means all the ways to make your displays your silent salesperson but they form a foundation that any retailer or small business can use to bump sales Exercise 1. Switch displays after two weeks of arrival Yes / No 2. Monitor inventory levels weekly Yes / No 3. Merchandise must be tagged Yes / No 41 41 41 41 Customer Relation and Sales Student Work Book 41

Session 13: STORE LOCATION If you are choosing a city or state to locate your retail store, research the area thoroughly before making a final decision. Read local papers and speak to other small businesses in the area. Obtain location demographics from the local library, chamber of commerce or the Census Bureau. Any of these sources should have information on the area’s population, income and age. You know who your customers are, so make sure you find a location where your customers live, work and shop. Location characteristics Let’s look first at location characteristics, which include such things as population density, retail synergy, and trade area access. While a co-op is less convenience-driven than is a conventional supermarket, this does not mean that a co-op can ignore the concept of convenience. In general, the greater the population density around a store, the more convenient that store becomes to a larger number of people. Further, to the extent that a co-op is readily available to its target population (rather than the population at large), its location convenience is enhanced. For example, it is fairly well known that the incidence of college graduates in a target population is positively related to store sales at a co-op. To the extent that a co-op is situated in proximity to a population base that is heavily college educated, the co-op will likely benefit in terms of sales and profits. Retail synergy is another characteristic of a co-op’s location. The word ‘synergy’ is derived from synergism, the concept that the whole is greater than the sum of the parts. In short, to the extent that a retail co-op is situated near other retailers — especially retailers that appeal to the same target market — the result is that all of the retailers benefit more than they would if they were each singular at the location. When considering the consumer demographic characteristics that constitute the target market for co-ops and natural food stores, it is evident that these same people tend to patronize bookstores, cafes and coffee shops, art galleries, certain types of clothing stores, specialty restaurants, etc. The more such retail and service facilities are situated in close proximity to one another, the stronger will be the overall customer draw to the area — thus adding to the synergy of the area that will benefit the co-op. 42 42 42 Customer Relation and Sales Student Work Book 42 42

A third location characteristic concerns trade area access — the ease or difficulty with which prospective shoppers can get to the store from various parts of its trade area. Consumer co-ops generally have the potential for having relatively large trade areas. This is because, relative to the target population base, most co-ops are specialty stores — and consumers generally will travel further to shop at a specialty store than they will to shop at a convenience store. To the extent that a co-op is located near (although not necessarily on) one or more major arteries, people in the more remote reaches of the trade area can get to the store more easily. Similarly, travelers passing through the area generally stick to major streets and highways — and the opportunity for them to shop at a co-op is facilitated to the extent that the co-op location is in close proximity to such streets and highways. In sum, a good location has the following characteristics: „ it is in close proximity to a density of target consumers; „ it has some synergy created by other nearby retailers who appeal to the same type of consumers; and „ it is readily accessible from all parts of the trade area. Site characteristics But what about site characteristics? What are the physical characteristics of a site that can add to or detract from a co-op’s appeal to prospective customers? There are at least four major site characteristics that impact the sales potential of a retail facility: visibility, ingress/ egress, layout, and parking. „ Visibility has a varied impact on a store’s sales potential. It is important when a shopper is trying to find the store for the first or second time. Once the shopper has become a regular customer, visibility no longer matters. But consider this fact: one in five families moves every year — which means that some part of a community’s population may be “shopping” for a new store. It follows that, if a store can’t readily be seen, new residents of an area (or prospective shoppers) probably won’t choose it. Another aspect of visibility relates to travelers and passers-by. Generally speaking, a store’s trade area accounts for 75-90% of its business. But the obverse of this means that from 10-25% of a store’s business comes from beyond its trade area. With respect to this component of a store’s business, visibility takes on added importance. „ Ingress/egress refers to the ease or difficulty with which shoppers can enter or exit the parking lot, or even the co-op itself. An evaluation of ingress/egress might include the presence or absence of curb cuts along a frontage street, deceleration or left-turn lanes allowing for ease of entry into the lot, distance of curb cuts from an intersection, speed limits on frontage streets, the number of travel lanes, traffic controls and signals, etc. In general, the easier it is to get into and out of a parking lot, the greater the likelihood of impulse shoppers stopping at the co-op in addition to regular shoppers. Conversely, the more difficult it is to get into or out of a lot, sooner or later there will be some attrition of regular shoppers. 43 43 43 43 Customer Relation and Sales Student Work Book 43

„ Site layout refers to whether the store is freestanding or is part of a development that includes other retailers (as in a shopping center) or other types of facilities (as in a mixed-use development). There are several aspects of layout that need to be considered: the relationship of the co-op to other stores or facilities in the development, the relationship of the co-op to its parking area, the relationship of the co-op to its frontage streets, and how it is oriented toward the neighborhood in which it is located. One layout situation to avoid if at all possible is where the co-op is situated in the corner of an L-shaped shopping center — since this greatly limits the amount of desirable parking. Another situation that can be problematic is where the front door to the co-op is too close to the front door of a major retail co-tenant — again, this limits the amount of parking that exists for co-op shoppers. „ Parking itself is another site characteristic that is especially a cause for concern in densely populated areas. When evaluating the parking that exists at a retail site, there are two considerations: parking capacity (the number of cars that can be parked, in total and in proximity to the co-op), and parking configuration (the way the parking lot is laid out, the direction of the travel lanes and spaces, the presence of berms and landscaping islands, etc.). As to parking capacity, there are several ratios that are generally used to determine the adequacy of a parking lot. While different ratios exist for different types of retailers or service providers, the ideal ratio for food stores is in the magnitude of 7- 8 cars per 1,000 square feet of food store. This means that a 10,000 square foot food store would have an ideal parking lot that could accommodate between 70 and 80 cars. Expressed differently, parking lots are generally designed on the basis of 400 square feet per car (which includes drive lanes, spaces, etc.). Thus, the ideal parking ratio for a food store is about 3:1, or 3 square feet of parking for every square foot of store. However, it should be noted that an ideal ratio hardly ever exists in real life — especially in densely populated areas. The point to be made, however, is that a food store should attempt to maximize its parking situation, in order to provide for those shoppers who travel a distance to get to the store. Obviously, the more suburban the co-op location, the greater the emphasis should be on maximizing parking availability. Urban stores typically get a significant amount of their business from walkers, bikers, and shoppers who use public transportation to and from the store — and thus can get by with a lower parking ratio. As to parking configuration, there are several considerations to be followed. First, a parking lot should be laid out so that the drive lanes are perpendicular (and the spaces are parallel) to the storefront, in order to facilitate shoppers walking between their cars and the store door. Second, food shoppers typically like to park in reasonably close proximity (within 300 — 350 feet) to the main entrance/exit of the store, and within sight of it. Third, parking lots should be as flat as possible, in order to minimize shopping carts careening out-of-control through the lot and into parked cars. 44 44 44 44 Customer Relation and Sales Student Work Book 44

In summary, it is important to remember that site and location characteristics can greatly influence customer loyalty to a co-op, its competitiveness, and ultimately its sales and profitability. Further, while perhaps not as obvious, the influence of such factors is felt not so much in the short run, but rather over the long run. Therefore, unlike many operations and merchandising decisions that can be changed with relative ease, decisions regarding a site can affect store sales and profitability over many years, often the length of the lease. Exercise What is store location Accessibility, Visibility and Traffic Don’t confuse a lot of traffic for a lot of customers. Retailers want to be located where there are many shoppers but only if that shopper meets the definition of their target market. Small retail stores may benefit from the traffic of nearby larger stores. „ How many people walk or drive past the location. „ Is the area served by public transportation? „ Can customers and delivery trucks easily get in and out of the parking lot? „ Is there adequate parking? Depending on the type of business, it would be wise to have somewhere between 5 to 8 parking spaces per 1,000 square feet of retail space. When considering visibility, look at the location from the customer’s view point. Can the store be seen from the main flow of traffic? Will your sign be easily seen? In many cases, the better visibility your retail store has, the less advertising needed. A specialty retail store located six miles out of town in a free standing building will need more marketing than a shopping store located in a mall. 45 45 45 45 Customer Relation and Sales Student Work Book 45

Exercise Tell about a store whose location was not good in your locality and sales are less in that outlet 46 46 46 46 Customer Relation and Sales Student Work Book 46

Session 14: STORE LAYOUT A well-planned retail store layout allows a retailer to maximize the sales for each square foot of the allocated selling space within the store. Store layouts generally show the size and location of each department, any permanent structures, fixture locations and customer traffic patterns. Each floor plan and store layout will depend on the type of products sold, the building location and how much the business can afford to put into the overall store design. Planogram: It is also known as plano-grams, plan-o-grams, schematics and POGs, are visual representations of a store’s products or services. They are considered a tool for visual merchandising. According to the Oxford Dictionary, “It is a diagram or model that indicates the placement of retail products on shelves in order to maximize sales.”Planograms therefore help dictate a retail store’s layout. The ultimate effectiveness of the planogram can be measured by sales volume. Planograms are created with the help of planograming software. The retail industry utilizes the automated software with the goal of ensuring accurate stocking. As the retail industry grows increasingly competitive, retailers are turning to planogram software to reflect each store’s unique customer desires and localized demand, while maintaining centralized control and supply chain efficiencies. For example, some software packages focused upon fast- moving consumer goods and hard goods sectors made some enhancements to transfer parts of shelving elements to single store measurements, which, according to the producers, should increase efficiency. Retailers are automating the creation of store-specific planograms through use of corporate- level business rules and constraints describing best practice product placements. Such planogramming solutions allow these companies to respond with location and language- specific messaging, pricing, and product placements based on business rules derived from location, campaign, and fixture attributes to create localized assortments What is a Planogram 47 47 47 Customer Relation and Sales Student Work Book 47 47

Session 15 - 16: STORE DESIGN 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. For example, research shows that male and female shoppers who were accidentally touched from behind by other shoppers left a store earlier than people who had not been touched and evaluated brands more negatively. 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. There are six basic store layouts and circulation plans that all provide a different experience: 1. Straight plan: this plan divides transitional areas from one part of the store to the other by using walls to display merchandise. It also leads the consumer to the back of the store. This design can be used for a variety of stores ranging from pharmacies to apparel. 2. Pathway plan: is most suitable for large stores that are single level. In this plan there is a path that is unobstructed by shop fixtures, this smoothly guides the consumer through to the back of the store. This is well suited for apparel department stores, as the clothes will be easily accessible. 3. Diagonal plan: uses perimeter design which cause angular traffic flow. The cashier is in a central location and easily accessible. This plan is most suited for self-service retail. 4. Curved plan: aims to create an intimate environment that is inviting. In this plan there is an emphasis on the structure of the space including the walls, corners and ceiling this is achieved by making the structure curved and is enhance by circular floor fixtures. Although this is a more expensive layout it is more suited to smaller spaces like salons and boutiques. 5. Varied plan: in this plan attention is drawn to special focus areas, as well as having storage areas that line the wall. This is best suited footwear and jeweler retail stores. 6. Geometric plan: uses the racks and the retail floor fixtures to create a geometric floor plan and circulation movement. By lowering parts of the ceiling certain areas can create defined retail spaces. This is well suited for appeal stores. 48 48 48 Customer Relation and Sales Student Work Book 48 48

Session 17: SHELVES Shelf space is a room which is allocated to different products in shelf. Shelf space is a precious asset for the retailer. Meanwhile it is a very challenging job for the retailer to allocate proper space to the products. Shelf space allocation directly impacts the retailer’s profit. Retailer allocates more space to those brands which contributes more to his profit. Purpose of this research is to find out factors which more or less impact the retailer shelf space decision to private & national brands. Retailers manage the shelf space in such a way which builds strong suppliers relationships and increases the customer’s satisfaction level. With the passage of time, issue of placing products in shelves is becoming crucial, because of increased competition between private and national brands.Retailer wants to give more shelves to private brands, while the manu- facturer also wants the proper shelf. If retailer does not give the appropriate shelf space to national brand then it does not give the too good image of retailer. The reason is that, customers are more aware of national brands, if they do not see national brands in the retail outlet, and then customers perceive the retailer is of low quality. Retailers consider five factors for the allocation of shelf space which increase the financial performance of the store. These factors include the location of fixture, location of product category, location of items in a category, off shelf display and point of sales materials 49 49 49 Customer Relation and Sales Student Work Book 49 49

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