Kirana immersion project

1. Kirana Immersion Project Analyzing pain area of Grocery Stores Submitted by: Anamika Gupta, PGDM-IB IB/04/02

2. Reliance Market(Mart) A subsidary of Reliance retail Ltd Reliance Market is an Cash & Carry Store The first store was launched in 2007 ,August in Ahemdabad Product are traded in bulk It offers more than 20,000 products

3. About The Project . Reliance is planning to launch one of these stores in Delhi NCR to know the problem of grocery stores with their wholesaler or distributors To know analyze the gaps which make shopkeeper to switch to organized wholesaler To observe the problem in grocery stores To interview shopkeeper

4. Retail Industry Market size INR 16 trillion Organized retail sector 2-3% Unorganized retail sector 97 % Growth rate 15 % p.a Contribution in National GDP 14% 7% Share Of Retailing In Employment There are around 12 million grocery stores in India Source: Technopark research 2010

5. Cash & Carry Store Cash and Carry model was developed by Lawrence Barely (he was entrepreneur and philanthropist) from Huddersfield . It is a wholesale model. It is a membership based retail store selling limited SKUs in bulk packs. Customers are usually members of the club and pay an annual fee Only For members like wholesalers, semi-wholesalers and retailers Source: Wikipedia

6. BITS AND BYTES No FDI restriction in cash & carry business Cash and carry in India is worth around $140 billion , Carefour , Metro AG and Bharti–Walmart are the major players

7. Objective of Project There are four major objectives of this project which listed as follows: Understanding Kirana profitability. Gaps in current kirana sourcing. Need gap of kirana for increasing their profitability. Key requirements which will make kirana shift their current sourcing to organized wholesale .

8. Sample Design

9. Analysis Profitability Of Shopkeepers’ Credit Limit Transportation Cost Frequency of purchase and time

10. Credit Preferred by Shopkeeper All the 8 stores of A, B and C type store purchase goods on credit. The two of the A type store stores those who have high sales & income around a crores don’t prefer credit, they pay cash on delivery of the products.

11. Number of credit days The majority of shopkeeper purchase goods on Credit. The credit limit may vary from 10,000 to Rs 100,000. The C type store takes credit of 20,000Rs approximately while B and A type stores credit varies with purchase. The most common time period for credit is 7 days. But some companies give credit for the time period of 15 days also in the case high volume purchase.

12. Transportation Cost FMCG companies provide Door to Door delivery and it is free of cost the branded staple products were delivered free to the stores while local staple products which are bought from whole sale market incurred the cost in transportation .

13. Frequency Of Purchase And Time

14. Frequency of Purchase of Stores (A, B, C) Per Month

15. Sourcing Type of product Branded Wholesale market Both by branded and wholesale mkt Staple 30% 20% 50% Mode Of Sale for Staple Product Sales rerensative Wholesale mkt Sales representive & phone Sales representative & wholesale Mkt On phone &wholesale market 11% 45% 11% 22% 11%

16. Mode of Payment

17. Shopkeepers’ Desirability

18. Observation Issue between shopkeeper and wholesaler/distributor Inventory management Account Management Company’s scheme for kirana stores Factor affecting sales Other Source of Earning Relationship edifice between Customers and stores

19. Problems Replacement means the substituting the damaged product with new product is major issue with distributor among all the stores. Most of the FMCG Company does not take replacement. Delay in delivery, out of stock and supplying more than the order is being placed are the common issues among store keepers. Unnecessary interference of distributor The scheme offered by company also has lot of terms and condition which is hard to achieve by shopkeeper especially with small retailers (B and C type).   The demand and desirability of stores varies with location.

20. Recommendations First all, it is necessary to provide free door to door delivery either its FMCG or Staple or other commodities.   we can come up with special offer on the purchase of less volume   We need create uniformity in pricing. The margin which we will be going to provide shopkeepers of small stores will be same as for the shopkeepers of big stores.   There is need to possess more branded product and variety in product in order to attract these stores. There must be a helpline number

21. There should be group of representative who can visit weekly in store in order to manage their inventory and take order as per the shortage in the stores It is necessary to keep inventory up to date according to demand

22. Conclusion The two month internship gave me an exposure in B2B and had developed my interpersonal skill I learnt about Different kind of Brands I get to know how business is conducted in B2B I learnt how to persuade and deal with people I learnt the art of selling I imbibe hard work, patience, determination and marketing skills from the shopkeeper

23. Things To Remember Listen to your boss Be punctual and be concise

24. THANKYOU