Study on Increasing Average Retail Bill Value 10

A Study on Increase in Average Bill Value by Ten Percent

A Project Proposal on
“A Study on Increase in Average Bill Value by Ten Percent”

At

Big Bazaar,

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Babasabpatilfreepptmba.com


Industry

Overview

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Retail is India’s largest industry, accounting for over 10 per cent of
the country’s GDP and around eight per cent of the employment. Retail
industry in India is at the crossroads. It has emerged as one of the most
dynamic and fast paced industries with several players entering the
market. But because of the heavy initial investments required, break even
is difficult to achieve and many of these players have not tasted success
so far. However, the future is promising; the market is growing,
government policies are becoming more favorable and emerging
technologies are facilitating operations.

Industry Evolution
• Traditionally retailing in India can be traced to
o The emergence of the neighborhood ‘Kirana’ stores catering
to the convenience of the consumers
o 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.

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• 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,
o mainly in urban areas, with facilities like car parking
o 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

The whole concept of shopping has altered in terms of format and
consumer buying behavior, ushering in a revolution in shopping in India.
Modern retail has entered India as seen in sprawling shopping centres,
multi-storeyed malls and huge complexes offer shopping, entertainment
and food all under one roof. The Indian retailing sector is at an inflexion
point where the growth of organized retailing and growth in the
consumption by the Indian population is going to take a higher growth
trajectory. The Indian population is witnessing a significant change in its
demographics. A large young working population with median age of 24
years, nuclear families in urban areas, along with increasing working-
women population and emerging opportunities in the services sector are
going to be the key growth drivers of the organized retail sector in India.

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Some Key Facts:

 Retail is India’s largest industry, accounting for over 10 per cent of
the country’s GDP and around eight per cent of the employment
 The market size of Indian retail industry is about US $312 billion
 Organised retailing comprises only 2.8 per cent of the total retailing
market and is estimated at around US$ 8.7 billion
 The organised retail sector is expected to grow to US $ 70 billion by
2010

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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
 As per a report by KPMG the annual growth of department
stores is estimated at 24%
 Ranked second in a Global Retail Development Index of 30
developing countries drawn up by AT Kearney.

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Traditionally three factors
Traditionally three factors Recent changes:
Recent changes:
have plagued the retail
industry:
industry:
Experimentation with formats: Retailing
Experimentation with formats: Retailing
Unorganized : Vast majority in India is still evolving and the sector is
in India is still evolving and the sector is

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of the twelve million stores
of the twelve million stores witnessing a series of experiments across the
are small "father and son"
are small "father and son" country with new formats being tested out.
country with new formats being tested out.

outlets
outlets Ex. Quasi-mall, sub-urban discount stores,
Ex. Quasi-mall, sub-urban discount stores,
Cash and carry etc.
Cash and carry etc.
Fragmented : Mostly small
Fragmented : Mostly small Store design : Biggest challenge for
Store design : Biggest challenge for
individually
individually owned
owned organised retailing to create a “customer-
organised retailing to create a “customer-
businesses, average size of
businesses, average size of pull” environment that increases the amount
pull” environment that increases the amount
outlet equals 50 s.q. ft.
outlet equals 50 s.q. ft. of impulse shopping. Research shows that
of impulse shopping. Research shows that
Though India
Though India has the highest the chances of senses dictating sales are upto
the chances of senses dictating sales are upto
number of retail outlets per
number of retail outlets per 10-15%. Retail
10-15%. Retail chains like MusicWorld,
retail

capita in the world, the retail Baristas, Piramyd and Globus are laying
Baristas, Piramyd and Globus are laying
space per capita at 2 s.q. ft per
space per capita at 2 s.q. ft per heavily in store
major emphasis & investing heavily in store
person is amongst the lowest.
person is amongst the lowest. design.
design.
Emergence of discount stores: They are
Emergence of discount stores: They are
Rural bias: Nearly two thirds
Rural bias: Nearly two thirds expected to spearhead the organised retailing
expected to spearhead the organised retailing
of the stores are located in
of the stores are located in revolution. Stores trying to emulate the
revolution. Stores trying to emulate the
rural areas. Rural retail
rural areas. Rural retail model of Wal-Mart. Ex. Big Bazaar,
model of Wal-Mart. Ex. Big Bazaar,
industry has typically two
industry has typically two Bombay Bazaar, RPGs.
Bombay Bazaar, RPGs.
forms: "Haats" and “Melas".
forms: "Haats" and “Melas". Unorganized
Unorganized retailing
retailing is
is getting
Haats are the weekly organized: To meet the challenges of
organized: To meet the challenges of
markets serve groups of 10-
markets :: serve groups of 10- organized retailing such as large cineplexes,
50 villages and sell day-to-
50 villages and sell day-to- and malls, which are backed by the
and malls, which are backed by the
day necessities. Melas are
day necessities. Melas are corporate house such as 'Ansals' and 'PVR‘
corporate house such as 'Ansals' and 'PVR‘
larger in size and more
larger in size and more the unorganized sector is getting organized.
the unorganized sector is getting organized.
sophisticated in terms of the
sophisticated in terms of the 25 stores in Delhi under the banner of
25 stores in Delhi under the banner of
goods sold (like TVs)
goods sold (like TVs) Provision mart are joining hands to combine
Provision mart are joining hands to combine
monthly buying. Bombay Bazaar and
monthly buying. Bombay Bazaar and
Efoodmart formed which are aggregations of
Efoodmart formed which are aggregations of
Kiranas.
Kiranas.


Consumer Trend

Over the years, the increasing literacy in the Country and the exposure to
developed nations via satellite television or by way of the overseas work
experiences, the consumer awareness has increased on the quality and the
price of the products/services that is expected. Today more and more
consumers are vocal on the quality of the products/services that they expect
from the market. This awareness has made the consumer seek more and
more reliable sources for purchases and hence the logical shift to purchases
from the organized retail chains that has a corporate background and where
the accountability is more pronounced. The consumer also seeks to purchase
from a place where his/her feedback is more valued.
India is currently having the largest young population in the world and 54
per cent of India’s population is below 25 years of age and 80 per cent are
below 45 years.

As per India’s Marketing Whitebook by Businessworld, India has around
192 million households. Of these only a little over six million are ‘affluent’ –
that is, with household income in excess of INR215, 000. Another 75
million households are in the category of ‘Well off’ immediately below the
affluent, earning between INR 45,000 and INR215,000.

This is a sizable proportion which offers excellent opportunity for
organized retailers to serve

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Social Trends:

Social trends of a country have impact on the scheme of growth of food
retailing in a country. India is country that is vast geographically and diverse
culturally. This has taken its toll on food retailing with retailers having to adapt
to the local cultures and palates of the area in which they have established or
plan to establish. This is a major reason for many or most retailing chains
restricting their operations to a certain part of the country. But the trends now
are slowly moving towards cultural integration where people of all states and
diametrically opposite cultures tend to try out foods and materials of other
states and communities. This movement towards social integration would
make it very feasible in the near future for retailing chains and erstwhile local
chains to spread across the country.
Increased income levels and more women willing to make use of their
education by joining work has increasingly affected the shopping pattern that
is moving towards fulfilling the need of convenience shopping in the form of
Supermarkets (now graduating to Hyper format) home deliveries. Indian
consumer is quality and price conscious and this awareness would drive the
retailers to rework their supply chain relationships.

A recent analysis shows that countries go through a distinct food
consumption evolutionary pattern. In the first stage the focus is on obtaining
basic dietary inputs, the second stage focuses on improving and building
basic foods, before moving to the third stage of adding premium food to the
diet. Most of urban India has already moved to the third stage and it is a great
avenue for food retailers, if they could slowly introduce the rest of India to it.
The future would witness creation of specific models/formats one for the
upwardly mobile urbanite and the other for the rural markets. Also since the

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taste habits change from place to place in India, there would emerge a
leading

Retail management skills
It is a fact that the retailing industry is in its starting phase in our country. The
benefits of organised retailing will only be felt once an equitable scale is
achieved. This to a large extent depends on the store size, the walkthroughs,
bills per customer per year, average bill size and the revenue earned per sq.
ft. But besides resources and bottomline, a variety of other aspects need to
be in place for tasting success. The need for qualified and trained manpower
is of utmost importance. The need for specialised skills is increasingly felt in
the areas of:

• Strategic management - strategising, targeting and positioning,
marketing and site selection, among others

• Merchandise management - Vendor selection, inventory management,
pricing and so on

• Store management - Layout, display, customer relationship, inventory
management, etc.

• Administrative Management - Human resources, finance, marketing
and so on

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Retailing formats 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, 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.

• Department Stores:

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!.

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• Hypermarts/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.

• MBO’s :

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.

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Major Retailers
 India’s top retailers are largely lifestyle, clothing and apparel stores
 This is followed by grocery stores
 Following the past trends and business models in the west retail
giants such as Pantaloon, Shoppers’ Stop and Lifestyle are likely to
target metros and small cities almost doubling their current number
of stores
 These Walmart wannabes have the economy of scale to be low –
medium cost retailers pocketing narrow margin

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Company
Profile

About Future Group
Future Group is the country’s leading business group that caters to the
entire Indian consumption space. It operates through six verticals:

 Future Retail : encompassing all lines of retail business

 Future Capital : financial products and services

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 Future Brands : all brands owned or managed by group
companies
 Future Space : management of retail real estate
 Future Logistics : management of supply chain and distribution
 Future Media: development and management of retail media
spaces

The group’s flagship company, Pantaloon Retail (India) Limited
operates over 7 million square feet through 1000 stores in 52 cities.

Future Group companies include, Indus League Clothing, that owns
and retails brands like Indigo Nation and Scullers and Galaxy
Entertainment that manages Sports Bar, Brew Bar and Bowling Co.
Future Capital Holdings, the group’s financial arm, focusses on
asset management and consumer credit. It manages assets worth
over $1 billion that are being invested in developing retail real estate
and consumer-related brands and hotels.

The group’s joint venture partners include..

 Italian insurance major Generali

 French retailer ETAM group
 US-based stationary products retailer Staples
 UK-based Lee Cooper

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 India-based Talwalkar’s, Blue Foods and Liberty Shoes.

Future Group’s vision is to,

“Deliver Everything, Everywhere, Every time to Every
Indian Consumer in the most profitable manner.”

The group considers ‘Indian-ness’ as a core value and its
corporate credo is - Rewrite rules, Retain values.

Major Milestones
1987

Company incorporated as Manz Wear Private Limited. Launch of
Pantaloons trouser, India’s first formal trouser brand.

1991

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Launch of BARE, the Indian jeans brand.

1992

Initial public offer (IPO) was made in the month of May.

1994

The Pantaloon Shoppe – exclusive menswear store in franchisee format
launched across the nation. The company starts the distribution of
branded garments through multi-brand retail outlets across the nation.

1995

John Miller –Formal shirt brand launched.

1997

Pantaloons – India’s family store launched in Kolkata.

2001

Big Bazaar, ‘Is se sasta aur accha kahi nahin’ - India’s first
hypermarket chain launched.

2002

Food Bazaar, the supermarket chain is launched.

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2004

Central – ‘Shop, Eat, Celebrate In The Heart Of Our City’ - India’s first
seamless mall is launched in Bangalore.

2005

Fashion Station - the popular fashion chain is launched aLL – ‘a little
larger’ - exclusive stores for plus-size individuals is launched

2006

Future Capital Holdings, the company’s financial arm launches real estate
funds Kshitij and Horizon and private equity fund Indivision. Plans forays
into insurance and consumer credit.

Multiple retail formats including Collection i, Furniture Bazaar, Shoe
Factory, EZone, Depot and futurebazaar.com are launched across the
nation. Group enters into joint venture agreements with ETAM Group and
Generali.

Pantaloon Retail (India) Limited

Pantaloon Retail (India) Limited is India’s leading retailer. The company
operates across multiple segments including –Food, Books & Music,
Fashion, Telecom & IT, Home & Electronics, General Merchandise,
Leisure & Entertainment, Wellness, Health & Beauty and E-tailing and
that helps the company cater to every Indian customer.

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Some of the leading formats include….

 Pantaloons : department store
 Central : seamless malls
 Blue Sky : fashion accessories
 aLL : fashion apparel for plus-size individuals
 Big Bazaar : hypermarket
 Food Bazaar : supermarket
 Fashion Station : popular fashion
 Collection i : home furnishings
 E-Zone : consumer electronics
 Depot : books and music
 Shoe Factory : footwear

Headquartered out of Mumbai, the company operates more than 331
outlets covering 5 million square feet of retail space, spread across 40
cities and has over 25,000 employees.

Fact sheet

Company Name: Pantaloon Retail (India) Limited

Corporate Headquarters:

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Knowledge House,

Shyam Nagar, Jogeshwari (East),

Mumbai 400 060.

India

Ph: +91 22 6644 2200

Website: www.pantaloon.com

Background: Founded in 1987 as a garment manufacturing company,
the company forayed into modern retail in August 1997 with the launch
of its first department store, Pantaloons in Kolkata.

Listing: Pantaloon Retail is a listed company on the Bombay Stock
Exchange (BSE, Scrip Code: 523574) and National Stock
Exchange(NSE, Symbol: PANTALOONR).

Employee Strength: 25,000

Big Bazaar
Big Bazaar, is the chain of retail stores of the big banner Pantaloon
Retail (India) Ltd., which in turn is a segment of the Kishore Biyani,
regulated Future Group of Companies.

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Moreover the customer friendly ambiance and the organized retailing of
products also make Big Bazaar one of the successful retail companies in
India.

Big Bazaar: Overview
Big Bazaar, a part of the Pantaloon Group, is a
hypermarket offering a huge array of goods of
good quality for all at affordable prices.
Big Bazaar with over 50 outlets in different parts
of India, is present in both the metro cities as well
as in the small towns.

Big Bazaar has no doubt made a big name in the
retail industry of india, moreover shopping here is
further made a memorable experience with the
varied rates of discounts on products as well as
discount vouchers available in a variety of amounts, like INR 2000, INR
3000, INR 4000, INR 5000 and INR 10000 on all Big Bazaar products and
accessories.

The variety of product
range in Big Bazaar:

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This large format store comprise of almost everything required by people
from different income groups.

It varies from clothing and accessories for all genders like men, women
and children, playthings, stationary and toys,
footwear, plastics, home utility products, cosmetics,
crockery, home textiles, luggage gift items, other
novelties, and also food products and grocery.

The added advantage for the customers shopping in Big Bazaar is
that there are all time discounts and promotional offers going on in
the Big Bazaar on its salable products.

The significant features of Big Bazaar:
Shopping in the Big Bazaar is a great experience as one can find almost
everything under the same roof. It has different features which caters all
the needs of the shoppers. Some of the significant features of Big Bazaar
are:

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• The Food Bazaar or the grocery store with the department selling
fruits and vegetables
• There is a zone specially meant for the amusement of the kids
• Furniture Bazaar or a large section dealing with furnitures
• Electronics Bazaar or the section concerned with electronic goods
and cellular phones
• FutureBazaar.com or the online shopping portal which makes
shopping easier as one can shop many products of Big Bazaar at
the same price from home
• Well regulated customer care telecalling services

Food Bazaar

Ab Ghar Chalaana Kitna Aasaan

Food Bazaar invites you for a shopping experience, unique by its
ambience. At Food Bazaar you will find a hitherto unseen blend of a
typical Indian Bazaar and International supermarket atmosphere.

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Flagged off in April’02, Food Bazaar is a chain of large supermarkets
with a difference, where the best of Western and Indian values have
been put together to ensure your satisfaction and comfort while
shopping.

The western values of convenience, cleanliness and hygiene are
offered through pre packed commodities and the Indian values of "See-
Touch-Feel" are offered through the “bazaar-like” atmosphere created
by displaying staples out in the open, all at very economical and
affordable prices without any compromise on quality.

The best of everything offered with a seal of freshness and purity will
definitely make your final buying decision a lot easier.

Big Bazaar

Big Bazaar is not just another hypermarket.
It caters to every need of your family. Where
Big Bazaar scores over other stores is its
value for money proposition for the Indian
customers.

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At Big Bazaar, you will definitely get the best products at the best prices
- that’s what we guarantee. With the ever increasing array of private
labels, it has opened the doors into the world of fashion and general
merchandise including home furnishings,
utensils, crockery, cutlery, sports goods and
much more at prices that will surprise you.
And this is just the beginning. Big Bazaar
plans to add much more to complete your
shopping expereince.

Electronics Bazaar

Currently present within Big Bazaar stores, Electronics Bazaar offers
the best deals in branded electronic goods and appliances.

Furniture Bazaar

Furniture Bazaar offers an entire range of Home Furniture needs that
are utilitarian and affordable in their pricing.

Depot
Books, Music & Gifts

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Depot is one of the youngest brands from the Pantaloon stable and is a
tribute to our freedom of thought, speech and expression shared in a
novel fashion with customers as books, multimedia, toys, stationary and
gifts.

Depot is all about freedom and democracy and this is reflected in the
relaxed manner in which products are displayed, the affordable pricing,
the strong local flavour, the young, lively and interactive store
experience, that are all designed in a way to liberate these categories
and transform the way they are bought, sold and perceived in India.

At Depot, book lovers are offered a range of books that meet the needs
and preference of every age group. From fiction to general reference,
management and children’s material, you will find it all at Depot.

Music buffs are invited to select from a wide category of music CDs and
cassettes spanning all genres like Rock, Pop, Hindi, Indipop and more.
For the movie enthusiasts out there, we have a great selection of home
videos (VCD and DVD) and multimedia (CD-ROMs).

Depot Store also has an attractive selection of gifts (candles, mugs,
photo frames, themed packs) toys and stationery (office, children’s and
fancy stationery) ensuring this is a one-stop shop for everyone and
anyone who plans to gift their loved ones.

At Depot we endeavour to give our customers an Indian experience
where we celebrate and give due importance to regional literature and
music. In this regard, Depot aims to become a strong member of the
local communities it operates in through a variety of events,
engagements and social initiatives and we will be happy to keep you

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posted on these activities from time to time.

Depot is a lively, colourful, vibrant and happy retail space, which we
hope you will visit in the near future. Inviting Reading Corners where
you can be comfortable with a book of your choice and an Interactive
Zone where you get to try out new board games, read new books,
check out new toys and browse at the Interactive kiosk, await you at
Depot.

Depot also has it's line of private label products. It is our guarantee that
you will not find better deals than what we are offering so check out
what is on offer today!

M Bazaar

Latest Technology, Lowest Price.

M Bazaar is the first and one of its kind
concept offering comprehensive solutions to

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satisfy the knowledge, entertainment and communication aspirations of
Individuals.

A value seekers haven, M Bazaar offers latest technologies at fantastic
prices. The product basket offers everything from airtime recharges,
mobile accessories, swanky brands in mobile phones, landline
instruments, blue tooth accessories, fashionable mobile trinkets and
much more.

Present as a part of Big Bazaars, these retail points are unique in
character by their warm presence combined with the cutting edge
branding.

The counters are specially designed to give the customers an easy
access to all the products thus making it a hot spot for all the tech
enthusiasts.

General Merchandise -Big Bazaar

Big Bazaar is not just another hypermarket. It caters to every need of
your family. Where Big Bazaar scores over other stores is its value for
money proposition for the
Indian customers.

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At Big Bazaar, you will definitely get the best products at the best prices
- that’s what we guarantee. With the ever increasing array of private
labels, it has opened the doors into the world of fashion and general
merchandise including home furnishings, utensils, crockery, cutlery,
sports goods and much more at prices that will surprise you. And this is
just the beginning. Big Bazaar plans to add much more to complete
your shopping experience

 Plastic Utensils and Crockery
 Head to Toe
 Appliances

Navaras

Jewellery for all emotions and occasions

Navaras, a fine 22 carat pure gold and
diamond jewellery brand, retailed from Big
Bazaar stores, offers nine unique rational
benefits to the consumer namely – BIS
Hallmark jewellery, free cleaning and
polishing, insurance cover against theft and

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burglary, transparent making charges, a buyback if unsatisfied, 0%
weight loss if jewellery is exchanged, diamond certification, free
karatmeter check and a range of designs.

The Navaras product range and store look is in keeping with the needs
of contemporary women. It is emotions and occasions that lead women
to buy jewellery, they buy jewellery to express emotions like pyaar
(love), during occasions like tyohaar (festivals) and as uphaar (gifts).
Navaras jewellery has been conceptualised with this thought - jewellery
for all emotions and occasions.

Future Group has revolutionized the Indian jewellery market with the
launch of Navaras, which offers branded, pure and design differentiated
jewellery at competitive prices in a hypermarket set-up in line with the
evolving buying behaviour of consumers. The rationale behind this is
that with higher disposable incomes, for consumers today gold and
other jewellery purchases too have become impulsive buying
activities. Hence, Navaras within Big
Bazaar.

But, certain criteria still remain constant
like carat, price, trust and purity – all
strong deciding factors while purchasing
jewellery. Thus, the format’s brand
positioning and offerings have been
tailored to suit the modern day consumer.

Navaras offers a complete fine jewellery
shopping experience, despite being within the confines of a hyper
market. This is ensured by the segregation of the Navaras section via

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glazed glass walls to provide a comfortable and secluded ambience.
The sit-down arrangement, as opposed to stand alone counters, further
ensures that shoppers try out the Navaras products in a peaceful and
comfortable environment before they make their final shopping
decision.

Pantaloon Retail (India) Ltd. opened a Big Bazaar outlet in Hubli on
July 28 2007, Saturday. This is the ninth outlet in the State and 62nd
outlet. Located near Akshay Centre, Gokul Road, it was the first and
biggest hypermarket store in the city.

With 50,000 sq. ft. of shopping area, the Big Bazaar in Hubli is one of
the largest stores of the company. The company hoped to do a
business of Rs. 50 crore to Rs. 75 crore in the first year of the Hubli
outlet.

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Project
Details

“Increase in Average Bill Value by 10%”

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Details of the project:

Time: This study spans for a period of 60 days between 10th
Dec 2007 and 19th April 2008.

Need for the Study:
• Looked at Higher sales do not always mean higher profits.
• This increase in average bill value will increase the sales and the
profitability.
This project is a requirement by the organization
and growth in sales is always expected in business.

Average Bill Value:
The average bill value is the average purchase
made by a buyer that is
= Total sales per day/Total number of bills made

This increase in average bill value will increase the sales
and the profitability. Thorough study of the past sales data and the
consumer buying behavior gives me good exposure and good
knowledge about the same.

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Surveys show that a large percentage of consumers do not
look at ads before shopping, do not prepare shopping lists, and make
purchases that are fully unplanned. In this situation some small
improvements at the store and strategies can make customer to buy
more. This study will helps to know the drawbacks and improve on
such areas so that the average bill value will be increased by Ten
percent.

By studying sales by store, department, and item, and comparing them
with prior periods, a firm can get a sense of growth or contraction.
Higher sales do not always mean higher profits. Sales data should be
examined along with profit and loss data.
Customer billing reports offer a lot of data. A retailer could learn about
inventory movement, sales by different personnel, peak selling time,
and sales volume. The purchase history itself evaluates against
budgetary or goals.

Objectives:

34


“Increase in the average bill value by ten percent”.

• To study different parameters influencing the purchase

• To study the previous and present sales reports and find out

the areas for improvement

• Identify products which can increase bill value and are

impulse in buying

• Create combo offers in departments and increase the ticket

size.

35


Methodology:

Since the project is conducted at Big Bazaar Hubli, data is very crucial.
Daily sales Reports were analyzed and interpreted to find the ways as to
how bill value can be increased. Various techniques and methods have
been implemented in order to achieve the aim.

Formulas:
• Avg.value per piece--- Store sale/no. of store qty sold
• Customer conversion--- No of bills/no of entry
• Avg.value per bill----- Store sale/bills made

 Collecting all historical data

 Analyzing the previous sales reports

 Observing the customer buying behavior to know what

makes him to buy more and what not

 Identify areas for improvement and implement different

strategies

36


WHY CUSTOMERS ARE LEAVING PRODUCTS AT CASH
COUNTERS

It was observed that most
of the time customers
leave at least one or two
products at the cash
counters while billing
which could have been
helped in increasing the
bill value.

To know what are the major reasons for this; a study was done
keeping in mind four major parameters ….

 OFFERS ARE NOT UPDATED
 IDOC PROBLEM
 LONG QUES
 WRONG COMMUNICATION BY TM

37


No Parameters Parentage of occurrence
1 OFFERS ARE NOT UPDATED 15
2 IDOC PROBLEM 25
3 LONG QUEUE 37
4 WRONG COMMUNICATION BY TM 23

A hundred billings were observed and the findings were listed
according to which the outcomes are as follows…

Thus we need to focus on using atleast 6-7 cash counters when

traffic is more and try to minimize queue length and another is
proper communication between the teem member to the customer
regarding offer.
The offers should be updated.

38


After implementing thee things the extent of customer leaving the
things near cash counters will decrease by 75%.
Also the Cashier should be updated with all the offers.

TECHNIQUES IMPLEMENTED

Cross selling
This is an effective and most important tool for a format like big bazaar.
Here merchandises are mixed with other related products and sold with
other products. This technique will help in increasing the bill value and
also liquidate the stocks.

E.g.: food Bazaar and Plastics merchandise can be crossed sold.
Vim bar, henko can be sold with scrubber or Brush form plastic
department

Up selling

This technique is very important too. Up selling is when you call a person's
attention to an item of greater quality (and cost). Here staff is trained to
sell more products to a single customer. This can lead to improve in sales,
increase in quantity and liquidate stocks. This can be done by preparing a
separate batch of 20 or 25 staffs and train them on how to convince the
customer in a clever way

39


E.g.: When a customer comes to buy a shirt or a pant, staff should
convince him to buy belt, socks or other accessories. He should be smart
enough in convincing the customers at the right way

Incentive
Incentive is a powerful tool to motivate staffs. Identify products which can
be sold in large quantities and set an achievable target.

E.g. Targets can be given on accessories which are between 50 Rs to 100
Rs. Motivate the staff to achieve the targets. This will increase the sales
and bill value of the customers.

Department wise combo offers.

Combo offers is nothing but combining products to give a better offers to
the customers. Here related products are combined together and given a
discount on all the products. This type of offers is highly effective in food
bazaar.

Eg: 10 Kg rice,10kg toor dall ,5 litre oil and 5 kg sugar can be combined
together and give a overall discount. Assume if a customer buys all the
products separately he will be charged 1000 rs, but if he avails a combo
offer we can give the same products at a discount of 50rs.

40


This can largely attract more customers and increase the bill value and
quantity.

Slab based offers:

Above all, it is the most important and effective tool to increase the bill
value. It can be done department wise or store wise. In this tool a slab rate
is set and hyped to maximum. Customer can avail exciting offers if they
fulfill the criteria’s set by the department /store.
EG. Shop for rs.999 and above and get 5kg sugar free.

Common promo area to highlight important offer products.

A common promo area should be created at the promo area on weekly
basis. This will highlight all the important offers of all departments.

Customers get impacted
when they look at this
area. Their decision
pattern changes when
they see an exciting
offer running on the
floor.

41


Other techniques implemented

 Identifying products which are impulse in buying

 Keeping items below 50rs at all cash counters

This was implemented. 8 bins having different items such as
cleaning articles, fridge bottles, glass dusters for car, soft toys were
kept near the cash counters.

In two to three days we found all items in 8 bins were sold
and bins are being refilled with new items.

 Using free bees which are leftover and give to customers to
buy more

Free Bees are those products which come as free gift with
some other product.
E.g. Glass bowl with Bru coffee, Sample items.
Some times customer will not take these free gifts. This stock can
be used to make customers buy more.

42


 Giving targets to individual –e.g. on accessories.

Targets can be given to the employees to sell more on some
section where sales is low. As in case of accessories they should
catch customers who are buying a pant and convince them to buy
one belt.

 Preparing combo offers
Combo offers are those where two or more different products will be
sold together at a lower price.

Eg.
o T- Shirts and caps
o Cotton jeans and belt
o Cargos with caps
o Shirt and tie

43


There were some combo offers successfully run at Food Bazaar and

Plastic utensils and crockery section during my project period and

added to the customer bill value.

Cont.

Food Bazaar Combo Offer

 1 KG Apple +1 KG Banana +1 KG Orange @ 75/-( FEB 1ST TO 26TH

FEB)

Slab Based Offer

 SHOP @99 IN Fruits & Vegetables and get 1 KG Tomato FREE -(

FEB 10TH TO 25TH FEB)

PUC combo Offer

 Buy a Bucket and Get Mug and Soap Box FREE ( FEB 18TH to 28th

Feb)

Slab Based Offer

 BUY For RS 899 and Get a STEAM IRON BOX FREE

 BUY a GAS STOVE and Get a MIXER GRINDER FREE

 BUY FRY PAN and Get A KADAI/TAWA FREE

44


Food Bazaar and PUC Combo Offer

 SHOP for RS 799 IN FB AND PUC and get 1 AIRTIGHT

CONTAINER FREE (IMPLEMENTED FROM FEB 17TH TO 28TH FEB)

45


Impulsive Products

Theoretical aspects of impulsive purchase

Impulse purchases occur when consumers buy products and /or Brand
they had not planned on buying before entering a store. There are three
kinds of impulse shopping

 Completely unplanned – A consumer has no intention of making a

purchase in a goods or service category before he/she comes into

contact with a retailer

 Partially unplanned - A consumer intends to make a purchase in a

goods or service category but has not chosen a brand before

he/she comes into contact with a retailer

 Unplanned substitution – A consumer wants to buy a specific

brand but changes his or her mind about the brand after coming

into contact with retailer

Impulse purchases are more susceptible to retailer displays than pre-
planned purchases:

46


“For most shoppers, the checkout lane is the final hurdle – choosing
the right lane and getting out of the store quickly is a major
objective. Retailers however view the checkout lane as ‘last chance
area’ –the place to sell impulse items such as candy and magazine
as well as small but profitable necessities batteries and razor
blades.”

After keeping impulse buying goods near cash counters at

Big Bazaar

47


Impulsive products—Apparels

KIDS BRAND NAME MRP
INFANTS TOPS ZERO 52/-
INFANTS
PYJAMA YES 49/-,59/-
INFANTS
LEGING ZERO 52/-
FEEDING
BOTTLE AUTO FLOW 55/-60/-
INFANT WEAR BABY MASTER 40/-
CHILDREN COMFORD
SOCKS FASHION 39/-
ACCESSORIES PNB 39/-,49/-
BOTTLE BRESH AUTO FLOW 18/-

LADIES BRAND NAME MRP
Caps many 49/- and above
Hanky BB 15/- and above
Socks BB 49/-
Shall / scarf DJ &C 99/-

MENS BRAND NAME MRP
CAPS ASST 49/-
SOCKS B.B 12/-
SOCKS BB 49/-
SOCKS KNIGHT HOOD 52/-

48


SOCKS DJ&C 45/-
LOVE BIRD BRAND(BLUE
HANKIES DIAMOND) 49/-

HOME LINEN BRAND NAME MRP
CUSHIONS BB 49/-
RUBBER MATS PALM FIBER 48/-
CHINDI MATS BB 9/-10/-,19/-,29/-
RUBBER MATS BB 29/-
WOOLEN MATS BB 59/-
NON SLEEP MATS 19/-
TELEPHONE MATS CLASSIC 39/-,49/-,59/-
HANDLOOM MATS BB 9/-
BAMBOO MATS BB 29/-
WOODEN MATS BB 10/-,25/-39/-
FLOOR DUSTER BB 29/-
KITCHEN DUSTER BB 45/-
GLASS DUSTER BB 49/-
YELLOW DUSTER BB 49/-
LANDURY BAG GENERATION 29/-
OVEN GLOVE BB 29/-
POT HOLDER BB 15/-
KITCHEN DUSTER BB 39/-
HAND TOWELS DREAM LINE 49/-
HAND TOWELS HOME STYLE 39/-
HAND TOWELS BB 49/-
COTTON TOWELS BB 40/-,60/-
PILLOW COVERS BB 35/-,39/-,59/-
HAND TOWELS BB 20/-
CHATTI BB 12/-
SHOWER CAPS BB 9/-,15/-,49/-
COASTER HOME COLLECTION 9/-
MAGIC WIPING 39/-

49


CLOTH
NYLON TABLE
COVERS BB 29/-

GENERAL MERCHANDISE- IMPULSIVE PRODUCTS

PLASTICS
CLEANING ARTICLES, CONTAINERS, POTS, FRIDGE BOTTELS,
BUCKETS, MUGS, CASSEROLES

UTENSILS
PLATES, GLASSES, VATTIES, LOW PRICE TAWA, TOPES, COOKERS

CROCKERY
MELAMINE PLATES, LOW PRICE DINNER SET, BOWLS

FOOTWEAR
SLIPPERS, KIDS SANDALS AND SHOES, LADIES SANDALS.

LUGGAGE
SCHOOL AND COLLEGE BAGS, DUFFEL BAGS, MENS AND LADIES
WALLETS

TOYS AND SPORTS

50


BELOW 99 SOFT TOYS, CHINKY DOLLS, SOFT PILLOW, INFLATABLE
BALLS, TENNIS BALLS,

Analysis

51


and
Interpretation

The average bill value per day and per month is calculated for four
months. December and January before implementing any technique.
Above mentioned techniques’ were implemented in the month of
February and March.

52


The data of every month and comparative graphs are shown in
following pages.

The tables below show the date and average bill value on that
particular day.

Average bill value = Total Sales / No. of Bills made

For the month of December…….

December Average Bill value
Date In Rs.
1 528
2 528
3 420
4 629
5 610
6 560
7 495
8 582
9 464
10 500
11 490

53


12 506
13 410
14 524
15 561
16 524
17 573
18 651
19 565
20 403
21 552
22 677
23 522
24 528
25 486
26 560
27 493
28 509
29 548
30 383
31 540

The average bill value for Month of December is Rs. 526

For the month of January……….

January Average Bill Value
Date In Rs.
1 547
2 550
3 473
4 417
5 500
6 417
7 517
8 381
9 909
10 680
11 449
12 482

54


13 465
14 513
15 530
16 581
17 461
18 377
19 977
20 489
21 423
22 528
23 380
24 469
25 487
26 459
27 569
28 402
29 974
30 572

The average bill value for month January is Rs.531

For the month of February…… after implementing different
techniques

February Average Bill Value
Date In Rs.
1 612
2 457
3 551
4 662
5 502
6 461
7 496
8 756
9 470

55


10 524
11 522
12 621
13 531
14 623
15 597
16 538
17 566
18 607
19 584
20 515
21 545
22 643
23 579
24 591
25 521
26 408
27 562
28 504
29 443

THE AVERAGE BILL VALUE FOR FEB IS 551

For the month of March…….

March Average bill value
Date In Rs.
1 569
2 598
3 658
4 586
5 578
6 595
7 510
8 569
9 610
10 798
11 596
12 549

56


13 484
14 570
15 660
16 588
17 648
18 576
19 534
20 694
21 654
22 673
23 657
24 684
25 588
26 565
27 1098
28 696
29 595
30 699
31 610

Average bill value for the month of March is 628

GRAPH 1

57


From the following GRAPH, it clearly indicates that there is a huge
increase in bill value. This is during the big days on Jan 25th, 26th
and 27th. Here it shows the hike on week ends. The bill value for
Saturday and Sunday was 977 and 974. The total customer entry
for these two days was 20638 customers.

Apart from these two big days the bill value of January is
decreasing compared to December in weekends

GRAPH 2

58


From the following graph it indicates that compared to month of Jan
and Feb there is a hike in bill value ON FEB except during Big bays

Graph 3

59


From the following graph there is a decrease in Bill value which
fluctuates from the range of 400 to 600 DURING WEEK days. The bill
value was on it peak during the big day i.e. on Friday (25th)
Total customer entry on 25th jan-3282

Graph 4

60


From the following graph it shows that there is a hike in bill value
during weekdays for the month of February.
The bill value compared to Jan and Feb. for week days it has risen by
11 %
January weekdays bill value—503
February weekdays bill value---558.

Graph 5

61


The following graph shows the comparison for the past three months
i.e. December, January and February. It clearly indicates there is
consecutive hike for the past three months.
December total ABV—526
January total ABV-----531
February total ABV----551

Compared to December and February there is a hike in 5 %

Graph 6

62


The graph of February is above January throughout the month apart
from two big days.

Form the following graph it indicates that there is hike in Bill value
by 4 % during the month of February

JANUARY ABV-531
FEBRUARY ABV-551

Graph 7 : Comparison of March and December
(whole month)
1200
1100
1000
900
800
700
march
600
Dec
500
400
300
200
100
0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

The average bill value in March is higher than December throughout the
month.

63


Average bill value in December : 526
Average bill value in March : 628
There is a increase in bill value by 19 %

Graph 8 : Comparison of March and January
(whole month)

1200

1000

800

march
600
jan

400

200

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

64


The average bill value in March is higher than January throughout the
month.
Average bill value in December : 531
There is a increase in bill value by 18%

Graph 9 : Comparison of March and February
(whole month)

1200

1000

800

march
600
Feb

400

200

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

65


The average bill value in March is higher than February throughout the
month.
Average bill value in February : 551
There is a increase in bill value by 13.7 %

Graph 9 : Comparison of all four months

1200

1000

800
march
Feb
600
jan
Dec
400

200

0
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31

66


The following graph shows the comparison for the past four months
i.e. December, January, February and March.
It clearly indicates there is consecutive hike for the months of
February and March.
December total ABV—526
January total ABV-----531
February total ABV----551
March total ABV--------628
Compared to December and February there is a hike in 18 %

Recommendatio
n

67


:: Loyalty
Progra
m

Theoretical aspects of Customer loyalty :
When customer loyalty exists, a person regularly patronizes a particular
retailer that he/she knows, likes, and trusts. Such loyalty lets a person
reduce decision making because he/she does not have to invest time in
learning about and choosing the retailer from which to make purchases.
Over the years research has addressed various aspects of shopper

68


loyalty. Loyal customers tend to be time-conscious, like shopping locally,
do not often engage in outshopping, and spend more per shopping trip.
In today’s competitive marketplace, it is a challenge for a retailer to gain
customer loyalty-the greatest asset a firm can have.

According to Harte-Hanks Market research

 Customer satisfaction is a crucial aspect of customer loyalty.

 Among the factors that create sense of loyalty beyond satisfaction

is the retailer’s “Value Proposition” and an ability to communicate a

caring attitude to customers

 Retailers can receive a higher-than-average degree of loyalty by

targeting shoppers who are especially predisposed to being loyal

Loyalty programs
A retail establishment or a retail
group may issue a loyalty card to a
consumer who can then use it as a
form of identification when dealing with
that retailer. By presenting the card, the
purchaser is typically entitled to either a

69


discount on the current purchase, or an allotment of points that can be
used for future purchases.
• Delighted customers will get extra discount every time on
making bill above Rs. 999/-

This is one program where any person can become a
delighted customer of Big Bazaar by purchasing above
1100/- in a single bill. He will be given a membership card.
Whenever he purchases above 999/- he can use this card to
get extra benefits or discount one the purchase. (Upto 5%).
He will also be getting many other benefits (during special
days, festivals etc.) and a strong customer relation will be
built. The card should be used atleast once in 3 months
otherwise it will be expired.

* This will help in building customer loyalty. People will turn to big
bazaar to make their monthly grocery and other purchases, even for home
linen and apparels. Customers shifting to other retail outlets will definitely
come down when they are treated as “delighted customers”
• Special offer for students – flash your Identity card and get
special discount
This may be for a week / fifteen days or a month “youth
festival” where college students will get special discounts
above certain amount of purchase. Students have to flash
their identity card of their respective institute to get such
discount.
They can also be part of other activities to get more by
showing their identity card itself and get….

70


 Special gifts hampers (latest music cds, accessories etc.)
 lucky vouchers
 Be part of Treasure hunt type games for one or two days to
create excitement and win more prizes.
* This effort is because youth is the major buyer in apparels and they
always make big bills. It is very important to see that these youngsters will
not shift to our competitors like Vishal.

Need and importance of this program:
• To build strong customer relationship and they can also maintain a
database of their delighted customers
• As I have observed the average bill at big bazaar is Rs. 500 to Rs.
600. There are around 40% of the customers who make bill
between Rs. 750 to Rs. 850. We can convince these customers to
buy some more and they will get extra discount on that and they
can become “delighted customers” of Big Bazaar.
• As number of competitors is increasing such kind of programs will
help Big Bazaar to attract and keep their loyal customers.

About loyalty card:
In marketing generally and in retailing more specifically, a loyalty
card / rewards card / points card or club card is a plastic or paper card,
visually similar to a credit card or debit card, that identifies the card holder
as a member in a commercial incentives programme. Loyalty cards are a
system of the loyalty business model.

71


In the United Kingdom and India it is typically called a loyalty card,
in Australia a rewards card or a points card, and in the United States
either a discount card, a club card or a rewards card. Cards typically have
a barcode or magstripe or an EPROM chip that can be easily scanned,
and some are even chip cards. Small keyring cards are often used for
convenience.

The card issuer requests or requires customers seeking the
issuance of a loyalty card to provide a usually minimal amount of
identifying or demographic data, such as name and address. Application
forms usually entail agreements by the store concerning customer privacy,
typically non-disclosure (by the store) of non-aggregate data about
customers. The store — one might expect — uses aggregate data
internally (and sometimes externally) as part of its marketing research.

Where a customer has provided sufficient identifying information, the
loyalty card may also be used to access such information to expedite
verification during receipt of cheques or dispensing of medical prescription
preparations, or for other membership privileges………….

e.g. Access to a club/reputed hotel

Suggestions

No. 1. Attract Shoppers and keep them in store
The amount of time a customer spends inside a store is directly
proportional to how much they spend. By making customers spend more
time in the store, companies can increase their sales. A classic example of
this is Barnes & Nobles book stores - they have a coffee shop inside the

72


book store, they provide comfortable lounge chairs and sofas so that
customers can browse books at leisure.

No. 2. Men & Women have different shopping habits
Men tend to walk directly to the required shelf - if the product is not on the
shelf, they tend to walk out. Men rarely ask for help from the store
attendants. If the required product is not seen in that store, they move on
to another store. This results in lost revenue.

An attendant always has to make sure that he asks the customer if he
found everything he was looking for. Note that the store attendant has to
be proactive when dealing with male customers.
Women need more space around them while shopping. Women tend
to avoid crowded stores or stores with narrow isles. The ladies section of
the store has more space around the merchandise - when compared to
men’s section. Women tend to spend more time for shopping if the section
is more spacious.
Since space is a major constrain for retailers, stores tend to be over
packed with merchandise - leaving very little room to move around. As a
result, many women prefer to buy at the local convenience or "Kirana"
shops. This represents lost revenue for the retailers.

No. 3. Make merchandise easy to find

Customers don’t like to hunt for products. Having all products clearly
classified and displayed increases the sales. Display the store layout.
Other chain stores do not even have sign boards.

73


Create a route for customers to follow within a store Customers tend to
slow down once they enter the store. Retailers can then utilize this by
organizing the store in such a way that it encourages customers to wind
their way all through the store, see/feel different things before they
proceed to the checkout counter.

Store should be designed in such a way that it encourages the customer
to walk through all the departments of the store - and that encourages
customer to buy more by reminding them of the things they need, or by
making them buy things on impulse.
Indian retailers are yet to catch-on to this concept. Most Indian retail
stores are space constrained. Enough space is necessary to create a
winding path for customers to follow.

No. 4. Make Checkout faster

Once customers have bought the products they need, they are eager to
pay & leave the store. Customer patience at this point is very low.
Retailers should have multiple checkout counters to address this issue.

Another trick to increase sales is to prominently display magazines,

74


chocolates, candies etc., at the checkout counter. These are high
margin goods which people tend to buy on impulse. Shoppers with kids
are particularly susceptible for this tactic.

Retailers have to catch-up on the customer service aspect at the checkout
counter. Very few checkout counters may result in long lines and lost
sales due to customers walking out without buying - because of the long
wait.
Many of the customers feel like avoiding Big Bazaar or other super stores
on weekends & evenings. Instead they prefer to buy things at the
convenience mom & pop stores instead. All this accounts to lost sales for
the superstores

Utility of the project:

75


1. The project will be helpful to the organization as it helps in
increasing the sales through increase in the average bill
value.
2. It will facilitate the management to know about the
drawbacks and to improve on it.
3. The study of the past data will help in knowing which
product, which department, which days, which offer will
make difference.
4. This project will give me a great exposure regarding
business analysis and good knowledge of customer buying
behavior. I will come to know different parameters
influencing the sales and how to overcome the drawbacks.
5. This project will also helps in
 Understanding parameters influencing customers’
purchase behavior
 Deigning combo offers and increase ticket size
 Different techniques which help in increasing the bill
value

76

Study on Increasing Average Retail Bill Value 10

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