UNIT III RETAILING DECISIONS Choice of retail locations - internal and external atmos herics !

!ositionin" of retail sho s #$ildin" retail store Ima"e - Retail ser%ice &$alit' mana"ement Retail S$ l' Chain (ana"ement Retail !ricin" Decisions) Location decisions can be very complex in retailing, costs can be very high, there is no flexibility once a decision has been made and the attributes of the location can have a big impact on the retailers strategy. The im ortance of location decisions is *eca$se of the follo+in" reasons : 1. Location is a major cost factor because of : Capital investment cost is very high if it is to be owned he rental cost also can be si!eable he transportation cost depends on locations "ffects the cost of #uman resources as you have to match the salaries in the locality $t is a long term decision and can not be changed very soon %. Location is a major revenue factor because of : Customer traffic depends on the location also to a great extent. " customer always wants to have his car or bi&e services at the nearest wor&shop. #e wants to buy the groceries in the nearest supermar&et 'olume of business is affected by location Location decisions can offer a competitive advantage, if properly done. (. he $ndian business always wants to own the property and this increases the cost involved wo terms are used with respect to location decisions and they are )Location and )*ite. Location is a broader term and it indicates the store and the trading area from where the majority of customers originate whereas a )site refers to the particular building or part of the building. )+ount ,oad can be a location and )*pencer -la!a can be the site .iscussion -oints : 1. /here would you li&e to locate a store to sell designer clothes 0expensive items1 for men 2 %. /here would you locate your retail store to sell 3+/ cars2

Le%els of location decisions and the determinin" factors " retailer has to ta&e retailing location decisions based on the following three 1. *election of a city or town %. *election of an area within the city (. $dentification of a specific site 1. *election of a city or own : he factors to be considered for selecting the city are: *i!e of the citys trading area: rading area is the area from which the customers originate. $t can be suburbs and other towns near4by -opulation and growth of the population trends can decide the potential for retailing -urchasing power of the people: he growth in population should be supplemented with purchasing power. " prosperous city li&e 3angalore or Ludhiana or 5ullunder can be a good location for upscale products because of the high purchasing power of customers otal retail trade potential for different lines of trade: " particular city may become famous for certain lines of retail li&e 6anchipuram for sil& saris and #yderabad for pearls 7umber, si!e and 8uality of competition: he 8uality and 8uantity of competition in the area is to be anaysed before ta&ing a decision *tarting cost or development cost: he cost of land, rental value etc also affect the attractiveness. $n $ndia, large organi!ed retail chains li&e 9ood/orld and *ubhi&sha preferred to start the activities in metros li&e Chennai or 3angalore since the land value and other costs were more reasonable in these cities at that time. %. *election of an area within the city : he following factors are to be considered Customer attraction power of a shopping area : -eople get attracted to come to 7agar in Chennai and Commercial *treet in 3angalore for shopping. Locating a retail outlet in these areas may attract customers to come to your store ;ualitative and 8uantitative nature of competitive stores: +ost of the gold jewelry retailing is done in 7agar in Chennai and all potential gold buyers will visit 7agar. #owever the number of jewelry shops is very high there. 9or electronic items, ,ichie street may be an option in Chennai

 "ccess to the area : $t should be possible for people to reach that area easily and 8uic&ly and there should be less traffic congestion. raffic congestion in and around 7agar of late is becoming a problem 7ature of governmental regulations: *ome laws may not permit setting up of commercial ventures in certain locations (. *election of a specific site within the area : 9actors to be considered are "de8uacy and potential of those who visit the site : $f your site is located in <sman road, there will be ade8uate number of people visiting past your site. "bility of the site to intercept the traffic: he site should be attractive to the customers passing through the street or site. $f a large number of school children only move through the street, it may not be a good location to set up a speciaised electronic store. Complementary nature of adjacent stores: he site will have greater potential if adjacent stores sell complimentary products. hus a store selling school boo&s will have greater potential if it is located near stores selling school uniforms "de8uacy of par&ing space: his is a very important criterion as most of the families have their own conveyance. =therwise, the valet par&ing is to be provided. T' es of retail locations 1. 9ree standing sites : hese are retail locations that remain unattached to any other retail stores or shopping centres etc. $n the case of &ios&s, it may be inside a shopping mall. he characteristics are: $t is convenient for customers as they have exclusive par&ing space generally he visibility is good and it attracts the customers $t has fewer restrictions regarding signage, wor&ing hours etc as they are independent as compared to a shopping centre he customer flow may be less because there are no other shops in the same premise to attract customers 9ree standing sites are more expensive if owned or even rented %. Locating in Central 3usiness .istricts: he Central 3usiness district is the traditional business area in a city or town. $t draws many people into their area during business hours. $t could be +ount ,oad or -arrys Corner in Chennai. he characteristics are as below:

 $t is normally a hub of public transportation li&e bus or train. here is a high level of pedestrian traffic here are also a large number of residences near4by -ar&ing area in normally very limited. -ar&ing problems and drive times will discourage the shoppers from a distance *hopping in the evenings and wee&4ends will be slow >enerally C3. areas suffer from a lac& of planning (. Locating in a shopping centre " shopping centre is a group of retail and other commercial establishments that is planned , developed , owned and managed as a single property. *pencers -la!a is an example of a shopping centre. he characteristics are as below: 3y combining many stores in one location, a disproportionately large number of customers visit the site than if the stores are in individual locations. $t is not uncommon for the sale of one store to increase after a competitor sets up shop in the same site. he developer and the management should ensure that they select the retailers carefully and provide the consumers a one4stop experience for all that they want to buy with a well4balanced assortment of merchandise he shopping centre management maintains all common facilities li&e par&ing, air4conditioning, house4&eeping, corridors, lift?escalators, security, etc he management also involves in advertising and sales promotion during festivals, seasons etc in a limited way +ost of the departmental stores have one or more prominent retailers who are called )anchors. *pencer -la!a has )Landmar&@ who could draw customers . hese anchors are often given special deals. A. Locating in speciali!ed mar&ets: +ost of the cities in $ndia have special mar&et places for certain particular product category. $n Chennai <sman ,oad is famous for jewelry and saris, ,ichie street for electronic goods, 3roadway for spectacle frames etc. hese places provide an established retail area to the prospective retailers to start a particular business , where they have o ma&e no efforts to attract customers to their shop B. -eriodic +ar&ets

 "nother peculiar type found in our country is the periodic mar&et, which is established at particular paces on a particular day in a wee& he retailers operating here have a mobile set4ups which they carry from one pace to another hese cater to the low income or middle income groups hese outlets do not offer credit to customers, the infrastructure4 related costs are very low and carry no big overheads. =nly a nominal fee has to be paid to the governments or panchayat 9actors that are considered before ma&ing a location decision . 1. -opulation characteristics and the trends : -opulation si!e, density, rate of growth, number of households, income level, education, age, occupation etc are studied before ta&ing a location decision %. -urchasing power and distribution : $f purchasing power is high, the mar&et should be good (. 3usiness Climate : $f the general economic climate of the area is good, the business will be good because of increased level of prosperity A. Competition : " place is over4stored if there are too many retail outlets, is saturated if it has enough outlets and is under4stored if it has less number of stores than re8uired. his factor must be analysed thoroughly before ta&ing a decision. *ome traditional approaches used for location decisions >o by gut4feeling approach. his means the retailer goes by his instinct and not by any scientific analysis. "ttribute4chec&list approach: he retailer considers various locations based on the cost, catchment area, par&ing space , accessibility etc and then arrives at the decision. ,iding piggy4bac& or parasitic approach: he retailer goes by the decision of other retailers already made. $f others who have located similar shops in a particular area, he also locates it there. INTERNAL AND E,TERNAL AT(OS!-ERICS "tmospherics refers to the stores physical characteristics that are used to develop an image of the store so that the customers are attracted towards it. $t

is defined as the physical elements in a stores design that appeals to the consumers and encourages them to buy.. here are two types of atmospherics and they are: 1. Cxternal atmospherics: his refers to the outer loo& li&e the frontal elevation, display windows, surrounding landscape etc %. $nternal atmospherics: his refers to the colour of walls, lighting, air4 conditioning, dressing room etc that helps to enhance the display and provide additional comfort to the customers ,ole of atmospherics in retail strategy or the importance of atmospherics Cnhances the image of the outlet in the minds of the customers $t attracts the customers to visit the store and remain there for long periods Creates a <*- 0 uni8ue selling proposition1 >enerates excitement 0 a separate play area for children1 9acilitates easy movements within the store 0 clear signages of product sections1 9acilitates easy access to merchandise in the shelves Cnsures that the space inside and outside is used optimally he merchandise is presented in an attractive and effective way to the customers he customer does not waste time in loo&ing for materials Cnhances the in4house experience of the customers he choice of physical surroundings, signages, fixtures, dDcor etc will enhance the image of the store in he minds of the customer "nother factor in atmospherics is the attire or dress worn by the employees. $f properly chosen and worn, this will boost the image of the store. Customers generally fee embarrassed to as& somebody if he wor&s there. -roper uniform will help solve the problem and it wi give an image of being professional "romas or scents present in the environment will also affect the customers perception favourably 3ac&ground soft music tempts the customer to stay for more time within the premises and ma&es him more relaxed $mmediate effects of music or colour 0 some elements of atmospherics1

1. Customer experiences pleasure or displeasure. -laying amil music will be received well in Chennai or amil 7adu but may not be li&ed, if done in .elhi or -unjab. %. Customer experiences stimulant or dampening: he nature of music played should match the mood and age of the customers. " shop selling to youth may play fast music. (. Customer experiences dominance or being submissive: he dominant colours in the stores create this effect. he colour red creates a feeling of being assertive whereas the colour blue gives a feeling of tran8uility and submissiveness Components of atmospherics 1. %. (. A. Cxterior atmospherics $nterior atmospherics *tore layout 'isual merchandising

1. Cxterior atmospherics 4 Clements *torefront E should be attractive enough for the customers to feel li&e entering Cntrances E should be functional and aesthetic. $n rural and semi4 urban $ndia, there is generally no door at the entrance /indow display E very common for shops selling apparels or gift items or shoes. Considered as very important for image building, for products li&e itan watches. .uring discount offers, the retailers &eep such items at the display window mentioning the discount applicable *ign 3oard : $t is painted or a neon lighted board with the name of the store, its trade mar& etc. +any outlets li&e *pencers, pi!!a #ut, +c.onalds, 9ord etc have their standardi!ed board #eight of building *i!e of building 'isibility <ni8ueness *urrounding stores *urrounding area

 -ar&ing facilities E -lays a very major role. *ometimes customers decide whether to visit a store or not, depending on the paring availability. -ar&ing should be spacious, available even during pea& hours, cost of par&ing should be reasonable, vehicle should be safe and secure while being par&ed and the wa&ing from the par&ing space to stores should be minimum. ,etailers can also offer valet service %. $nterior atmospherics E Clements 9looring E *hould be appealing, non4slippery and attractive Lighting E *hould be neither too bright nor too dull, al merchandise to be clearly visible *cents E -leasant scents enhance the experience 8uality 9ixtures /all emperature E *hould be set to ma&e the customers comfortable "isles rial room Cleanliness *elf service -rice labels E should be easy to read and understand -ersonnel E 9riendly, well attired and &nowledgeable +usic E should be soft, pleasing and enjoyable ,est rooms -lay area for children Coffee shop (. *tores layout Layout refers to how various merchandise or groups of merchandise are arranged within the stores for the convenience of the shoppers. his should be customer4friendly in the sense that it must offer ade8uate space for the customers to move through the stores as well as for the effective display of the merchandise. >ood store display will motivate the customers to move through the stores and even loo& at things which was not in their current shopping list

he placement of rac&s and shelves within the stores is very important and this determines the space available to the customers to move and enjoy shopping. oo many rac&s and shelves also confuse the customers. +any retailers have the shelves placed along the walls to save space. ypes of stores layout 0s&etches given separately1 1. >rid layout: >rid consists of rows and columns type of arrangement and is followed in all conventional shops. #ere customers can easily locate the items of their choice. and is suitable for customers who fre8uent the shop, say three times in a wee&. Cven though it is not very aesthetic, it ma&es it very customer4friendly. his arrangement ma&es the best use of the available space.

%. 9ree4form layout: $n this format, the fixtures and aisles are placed asymmetrically and this provides informal setting and customers feel comfortable to browse and shop. his is also called )bouti8ue layout. #ere the role of sales personnel is important to guide the shoppers "s the movement of customers is hapha!ard, the possibilities of shoplifting is high in this arrangement which is shown below.

(. ,ace trac& layout Customers visiting stores with this format will be made to go through specific paths and therefore they will be made to visit as many departments as possible. hey will be exposed to a large number of products and promotion materials. his is also &nown as loop layout. Loop design encourages impulsive purchases as shoppers are exposed to items other than what they came in to buy. 9or example, 3ig 3a!aar and -antaloon store in >urgaon have adopted this to draw the customers to multiple sections. A. *toreyed layout : his is most popular in $ndia and most of the Leading chains li&e *pencers, 7illgris, *hoppers *top etc follow this. his utili!es the space most effectively. his saves substantial amount of initial investment of the retailer in view of the real estate cost RETAIL !OSITIONING " positioning strategy is a plan of action of how the retailer will compete in the targeted mar&ets and how it will differentiate itself from the competition. ,etail positioning is the process of creating and maintaining a distinctive and valued image of the retailer in the minds of the customer. he important thing is how the customer views the retailer and his offerings in terms of product and services -ositioning can be a deliberate attempt to differentiate from the rest of the mar&et either by offering superior value ? 8uality li&e *aravana 3havan or great price competitiveness li&e *aravana *tores 3roadly there are three positioning strategies as beow: -roduct differentiation is achieved through uni8ue or exclusive products or brands, own4branded products and unusually broad and deep merchandise offerings. hin& of "chi branded products or + , products *ervice or personality augmentation: his can be done in many ways li&e convenient location of the retail outlets, long wor&ing hours, wor&ing on *undays and holidays, 6nowledgeable and courteous staff, home delivery, generous return policy etc

 -rice leadership : his can be established by offering value for money. +c.onald chain al over the world is &nown for offering best value for money. /al4+art is also &nown to follow this -ositioning is not something which can not be changed. $f sales and mar&et share start falling, the management should ta&e a re4loo& at the positioning. ,epositioning needs to be considered if there is a big discrepancy between the perceptions of the customer and the retailer #$ildin" retail store Ima"e or *$ildin" *rand ima"e " brand is a name, sign, symbol, slogan or anything that is used to identify and distinguish a specific product, service, or business. " legally protected brand name is called a proprietary name. 3rand means a set of emotional and sensory inputs a consumer associates with a particular product or service in their memory system 3rand is the complete bundle of thoughts a customer has in his or her mind about a company, product or service developed through communications and experience, including the distinguishing FhumanF characteristics of a brand personality 0eg, warm and friendly, strong and reliable1 Consumers feel differently when they stay at aj group of hotels as compared to ,amprasad group of hotels.. *trong brand names can affect customers decision ma&ing process , motivate repeat visits and purchases and build loyalty. -eople li&e to buy sil& saris from 7allis rather than from some shop in -arrys corner. " strong brand image also enables the retailers to charge higher price and ma&e more margins. 3rands with wea&er images will have to resort to discounting to maintain their mar&et share #ow to build retail brand image2 1. Create a high level of brand awareness %. .evelop favourabe associations with the brand name (. Consistently reinforce the trend Let us now elaborate these steps:

1. Creating a high level of brand awareness : 3rand awareness is the ability of the potential customer to recall or recogni!e the brand. )"ided recall is when the customers indicate that they &now the brand when the name is told to them. ) op4of4mind awareness is that the customer remembers that particular brand so well and comes first in his mind he top4of4mind awareness is created by 4 #aving a name that is easy to remember 07alli1 4 ,epeated advertisements 0 Chennai sil&s1 4 ,epeated sponsorships 0,+6'1 4 #ave a large number of outlets 0#ot Chips1 4 Catchy slogans, attractive logos, etc %. .evelop associations 3rand association are anything that is lin&ed to connected to the brand in the minds of the customer. *ome common associations that the customers develop with their brand name are as below 4 +erchandise category: Chennai sil&s will have the customers associate its name with sil& saris. 6rishna *weets will have the customers associate its name with sweets. *o whenever the customer has a need to buy sweets, this name comes in his mind because of the association. 4 -rice or 8uality: /al4+art is associated with low price sand good value 4 *pecific attribute or benefit: 0 he convenience store G4Cleven is part of an international chain of retail stores1 (. Consistent reinforcement of the image of the brand he retailers brand image is developed and maintained through the retailers communication program and other elements of communication mix. he other elements are merchandise assortment, pricing, the design of the stores, web site and the customer service that the store offers. ,etailer needs to be consistent in his messages and send the same &ind of message through various elements. $f price is the main brand strength, the same has to be conveyed always and through al elements.

,etailers need to develop an inte"rated comm$nication ro"ram. a program that integrates all communication elements to deliver a comprehensive and consistent message. /ithout the consistency, the various elements may wor& at cross4purposes. 9or example, the ' advertising may mention and highlight about the variety of merchandise in the store, the sales promotion may be pitched on attractive prices. $n such a case different messages may be going to the customer and so the customer may not form a uni8ue image about the store. ,etail image factors o measure the image of the retail store or shopping centre, it is essential to identify the relevant customer attitudes. Lot of wor& on this has been done in the western world. he most comprehensive presentation is 9is&s conceptual model in which he summari!es the store 8ualities as below:

9$*6* C=7CC- <"L +=.CL 9actors .eterminants 1. Location convenience 1. "ccess ,oute %. raffic barrier (. ravelling time A. -ar&ing availability %. +erchandise suitability 1. 7umber of brands stoc&ed %. ;uality (. 3readth of assortment A. .epth of assortment (. 'alue for price 1. -rice of a particular item %. -rice of same item in another store (. .iscounts A. *ales effort and stores 1. Courtesy of salesmen services %. #elpfulness f salesmen (. ,eliability and usefulness of advertising A. 3illing procedure B. "de8uacy of credit arrangements H. .elivery promptness and care

B. Congeniality

H. -ost4transaction satisfaction

G. Cating facilities 1. *tore layout %. *tore dDcor (. +erchandise display A. Class of customers B. *tore traffic and congestion 1. *atisfaction with goods purchased and used %. *atisfaction with returns (. *atisfaction with price A. *atisfaction with accessibility to store

he above list is not comprehensive and may not apply to al industries. 3an&s may have to develop other dimensions relevant to them $mage concept is most relevant in respect of the retail sector because of the customer intimacy with the store. Li&e the producers who only deal with the limited number of wholesalers, retailers relate directly with the consumers through physical premises, sales force, offerings, and services. hus customers develop personal images of retail stores based on their experience +c .onald chain has positioned itself as a family restaurant in $ndia as $ndians go out with family. 3ig 3a!aar discount store , to overcome the notion that $ndian masses perceive low prices to indicate low 8uality, stressed on ) sabse sastha, sabse acha ) RETAIL SER/ICE 0UALIT1 (ANAGE(ENT Customer service is the set of activities and programs underta&en by retailers to ma&e the shopping experience more rewarding for their customers and to build customer loyalty leading to higher level of sales hese activities increase the value that the customers are receiving from the merchandise and services that they purchase "ll the employees of the retail company contribute to the customer service and it is not only the sales personnel. Cmployees wor&ing in the distribution centre of the retail firm contribute to service by ensuring that all merchandise that the customer wants are available in the store at the time that they want. Cmployees wor&ing in the house4&eeping

department ensure that the store is &ept clean and the air conditioning is wor&ing fine. *ome of the service provided at the retail sector can be in the following areas. Acceptance of credit cards Alterations of merchandise ATM terminals Child-care facilities Credit Delivery to home or office Demonstrations Display of merchandise Dressing room Extended store hours Signages to locate and identify merchandise Gift wrapping ar!ing Special facilities for handicapped customers lay area for children "epair services "est rooms "eturn privileges Shopping carts Special orders #arranties +anufacturers ma&e the 8uality of products consistent from item to item. 3ut the 8uality of retail service can change from one store to another and even from one sales person to another within the same store. $t is very difficult to manage service provided by all salesmen. he challenge of providing consistent high48uality service provides an opportunity to develop a competitive advantage. here are two approaches to develop and manage sustainable service 8uality 1. Customisation approach his approach encourages the service providers to tailor their services to meet each customers personnel needs. 9or example in apparel shop or in a shoes retailing shop, the sales assistants try and help the customers to choose the right item. he customi!ed service approach results in many customers receiving superior service. 3ut the service may be inconsistent because service delivery depends on the judgement and capability of service provider. %. *tandardisation approach $t is based on establishing a set of rules and procedures and ensuring that they are followed strictly and consistently. *ince everyone follows the

same *.=.- 0*tandard =perating -rocedure1, the inconsistency in service is avoided or reduced hrough standardi!ation, the fast food chain +c.onald has ensured that the same 8uality of food is served all over the globe and served in time. he food may not be exactly what every customer wants but it is consistent, served in time and at low cost *tore design and layout also plays a role in the standardi!ation approach. $n many situations, the customers do not need any assistance in selection but only want to &now where the product ? brand is located and buy it 8uic&ly. $n these situations, the retailer can provide service by providing a layout and signages at proper locations which will enable the customer to locate the item easily. C=* =9 C<* =+C, *C,'$CC $t must be understood that the higher the 8uality of service provided, higher is the cost. *avoy #otel in London offers very special benefits to the customers. Cvery floor has a customer service representative and attends the needs of the guests. he customer gets complimentary fruit bas&et every day and the customer can decide what fruit he li&es to have. 3ut *avoy is expensive place to stay. +any retail companies in <*" were following a very generous )goods return policy and provided ) no 8uestions as&ed service. #owever there were misuses of this and the companies incurred a high cost. 9actors in service 8uality management Customers base their evaluation of store service on their perception and not necessarily on hard facts. 9ive factors that customers generally use to evaluate the retailer 8uality are: ,eliability: "ccuracy of billing, availability of the wanted product?brand "ssurance 0 rust1 : >uarantees, /arranties, return policies etc angibility : "ppearance of stores, arrangement, sales people Cmpathy: -ersonali!ed service, recognition by name ,esponsiveness: ,eturning calls and e mails, giving prompt attention and service

#=/ 3,".+==, , /=,L.* -,C+$C, ,C*=, $7 <*" +"7">C* #C 9$'C 9"C =,* E case study 1. ,eliability: Cvery employee attends a training program before they are put into the job of handling the guests. hey are trained to give an estimated time for any service that the customer demands 0room service, laundry service, arranging taxi etc1. /hen an employee ma&es a promise, he has to fulfill the same. Cmployees are told never to guess the expected time. $f they do not &now they have to chec& with the superiors before committing %. "ssurance: $t conveys trust by empowering the employees. $f any guest faces a problem with respect to the food not being as per his order, the employee has powers to offer him something other item li&e dessert free to satisfy the customer. $n $ndia -i!!a Corner offers free -i!!a if it is delivered beyond AI minutes (. angibility: 3roadmoor spent J %II million during 1KK% to %II% to upgrade the facilities in the resort by renovating the rooms and adding a new outdoor swimming pool A. Cmpathy. Cmployees are always told to address the guests by name. o accomplish this all employees are told to find the names of the guests through name tags, luggage $. tags etc./hen every one addresses him by name he gets a feeling of being ta&en care of. B. ,esponsiveness: Cvery employee is instructed to follow )#C", model 4 #ear what a guest has to say 4 Cmpathi!e with them 4 "pologi!e for the situation 4 ,espond to the guests needs 4 a&e action and follow it up

#C >"-* +=.CL 9=, $+-,='$7> ,C "$L *C,'$CC ;<"L$ L $n order to increase the retail service 8uality, the retailer has to reduce the )*ervice >ap which is the gap or difference between the customer expectations and perception of the service delivered to him. 9our factors affect the service gap:

1. 6nowledge >ap : he difference between customer expectations and the retailers perception of customer expectations %. *tandards >ap : he difference between the retailers perception of customers expectations and the customer service standards of the retailer (. .elivery >ap : he difference between the retailers service standards and the actual service provided to the customer A. Communication >ap: he difference between the actual service provided to the customers and service promised in the retaiers communication program hese four gaps add to the service gap. herefore the retailer must try and reduce each of these gaps. hus the &ey to improving service 8uality is to do the following: 1. %. (. A. <nderstand the level of service that the customers expect *et standards for providing customer service $mplement programs for delivering service that meets the standards <nderta&e communication programs that will inform the customers accurately about the service that will be offered

/ays to reduce &nowledge gap: he most critical step in providing good service is to understand what service the customer realy wants. +any retailers ta&e wrong decisions because they are not aware of what the customer expects. ,etailer may fill his store with all varieties of merchandise thin&ing that this will improve his service 8uality but the customers may actually thin& that they are spending too much time at the payment counter and it should be made faster. 1. Do com rehensi%e st$d' to understand what the customer expectations are.. he leading 5 C -enny in <*" collects answers to their 8uestionnaire every year from BI,III customers and get their feedbac& on the service provided. "s the 8uestions are same, they are able to assess whether the service perception is improving or declining. %. (eas$re the satisfaction of indi%id$al transaction2 6ingfisher "irlines gives a feedbac& form during the flight to the passengers and as& them to fill up the same so that the customer can give his opinion of the service provided to him as he is experiencing the service.

(. C$stomer anels and inter%ie+s 3 disc$ssions2 +any financial service providers li&e 3ajaj 9inance arrange a meeting of their select customers once every 8uarter to understand the customer perceptions on the service provided. Car servicing companies call their customers over phone after a few days of service and as& them for feedbac& on how the service was provided A. Interactin" +ith c$stomers2 =wners of small retail outlets interact with customers every day for every purchase and get first hand feedbac& immediately B. C$stomer com laints2 Customer complaints are recorded and analysed periodically so that the problem areas are identified H. 4eed*ac5 from em lo'ees2 "nother good source from which we can understand customer expectations are the stores employees who handle customers every day, every hour. /ays to reduce the standards gap "fter the retailer gain &nowledge of what customer expectations are, the next step is to use this information to set standards and develop systems for delivering high 8uality service. *ervice standards should be closer to customer expectations than internal operating constraints 1. To mana"ement sho$ld *e committed to hi"h &$alit'. op management must be willing to incur additional expenditure in order to improve the service. "ny additional service efforts would mean increased cost. op management should also appreciate efforts ta&en by employees to improve service %. To mana"ement sho$ld define the role of ser%ice ro%iders 6 set ser%ice "oals: +any successful retail dealerships li&e that of oyota have given clear instructions to employees li&e ) every phone call should be answered within three rings, )each customer to the showroom should be greeted within (I seconds etc. >oals should measurable, specific and achievable. (. Assess the ser%ice &$alit' contin$o$sl': +any retailers use )+ystery shoppers to assess the service 8uality. )+ystery shoppers are actually people whom the retail management sends to the store to see how they are treated by the employees. he mystery shoppers typically find out how the customers are received, how long it ta&es for someone to attend the customer, how &nowledgeable the salesmen are, etc. A. Train and "i%e information to the em lo'ees on a continuous basis on the customer expectations and how to provide

/ays to reduce the delivery gap o reduce the delivery gap and provide that exceeds standards, retailers must give their employees instrument and emotional support, give necessary s&ill and &nowledge, improve internal communication, reduce conflicts and empower employees to handle situations 1. !ro%ide instr$mental and emotional s$ ort2 " ban& employee may be able to offer better service with a computer terminal on his table. " billing counter operator will bill faster if he has a bar code reader. #ence appropriate instruments are to be provided. *ervice providers will have to tac&le difficult situations when the customer may not be right. <nder these conditions, he will need emotional understanding of the fellow employees and also the employer. %. Im ro%e internal comm$nication2 /hile providing customer service, the store employees have to often manage the conflict between the interest of the customer and that of the firm. 5 C -enny has policy of accepting the returned goods without as&ing 8uestions. *ometimes the customer may not have used the item properly but would demand his cash bac&. he loyal employees of 5 C -enny will not li&e their company to lose. ,etailers can reduce such conflict by having clearly mentioned policy guidelines in their sales manuals so that it is clear to the customer as well as to the employee. (. Em o+er the store em lo'ees2 "llow the employee at the lowest level to ta&e decisions concerning the customer service issues. 3ut you have to train and coach the staff so that they do not go beyond limits. A. !ro%ide incenti%es2 $ncentives are paid to employees who solve a service related problem with the customer. /ays to reduce the communication gap $f we overstate the service levels in the advertisements and other communication channels, the customers expectation is raised. /hen the expectation is not reali!ed, then there is a gap. 1. Realistic commitments 2 "dvertising program is developed by the mar&eting department whereas the stores personnel are the ones to deliver service. -oor communication between these areas may result in a mismatch between the promise made in the ad and the actual service provided. %. (ana"e c$stomer ex ectations2 +any times when a customer ta&es his car for service, they do not mind the delivery time as long as it is communicated properly at the time of their giving the car for service.

Customers only want the car to be given bac& as per the promise made. #ence being honest ant transparent helps (. Listen to the c$stomers2 Customers can become very emotional about their real or imaginary problems with the retailer. =ften this emotional problem can be managed by giving a very patient listening to the customer to get the complaints off their chests. *tore employees must allow the customers to air their grievances without interruption. $t is hard to reason with an irritated customer. $n a supermar&et, the customer may not sometimes be satisfied if you replace a defective product with a new one. #e may want an apology also. A. !ro%ide a fair sol$tion2 Customers typically prefer tangible resolution of their complaints. Cxtra discounts or additional benefit coupons will be better than a verbal apology. B. Resol%e the ro*lem &$ic5l'2 Customers are more satisfied if the first persn whom they ta&e their complaints to, solves it. he more persons he has to meet, the more irritated he becomes. SU!!L1 C-AIN (ANAGE(ENT IN RETAIL Cfficient supply chain management provides t+o *enefits to customers 1. ,educed stoc&4out E he number of times that stoc&4out occurs is minimi!ed. %. ailored assortments 0 means the right merchandise re8uired by each retailer1 1. Red$ced stoc5-o$t : he worst thing that can happen to a retailer is non4 availability of an item wanted by a customer when the customer has visited the store. $f a customer visits 'ive&s to buy a *amsung LC. ' E (% inches and if it is not available, he would go to Croma and buy the same. 7ot only that, he would also buy some more items that he normally buys from 'ive&. herefore the stores should do everything to ensure that the number of times that stoc&4out occurs is reduced to a minimum. %. A%aila*ilit' of the ri"ht items2 "nother benefit of an efficient *C+ is that each store gets what is exactly re8uired by the customers in that area. 3ig 3a!aar in 7elson +anic&am road may need different &ind of items compared to 3ig 3a!aar in 7agar. his is alos made possible because of superior information system as details of each sale are captured in the information system.

"s sellers of the merchandise to the final customers, retailers are dependant on the supply of merchandise in order to provide a high level of service to the to their customers. $n some cases, the manufacturer may deliver directly to the retailer, in many cases, the product goes through a complex route of transportation, warehousing, and various handling devices in order to move from the production location to the customers home. *ome products li&e fruits, vegetables , etc also need refrigerated storage. *upply chain
' 1 ,egional .istribution Centre 1 ,etail outlet 1

'%

,etail outlet %

'(

customers

,etail outlet (

'A ,etail outlet A 'B ,egional .istribution Centre %

,etail outlet B

'H

,etail outlet H

' 4 'C7.=, =, *<--L$C, he above figure represents a normal supply chain. here are cases where the vendor directly sends to retailers also. ,etailers are ta&ing an increasing role in *C+. he large retailers own their own distribution centres and are ta&ing a leadership role in *C+.

Cfficient supply chain management which also includes information management provides benefits to retailer in the following ways: 1. -i"her ret$rn on in%estment2 $t increases the sales, net profit margins, and improves inventory turnover ratio. ,etailers can also reduce their transportation expenses by coordinating deliveries. " good information system that coordinates among the vendors and the buying staff of the firm helps to buy things at a lower cost and improve margin. %. Strate"ic ad%anta"e2 " critical factor in /al4+arts success is its information and supply chain management. Cven though competitors understand this, they are not able to achieve the same level of performance because of two reasons, 11 /al4+art has made substantial investments in developing its systems and it has the business volume to justify this %1 $ts systems are not simply some software any firm can buy from any supplier but they are customi!ed for /al4+art through experience and earning !$ll-t' e and !$sh-t' e s$ l' chains2

7) !$ll s$ l' chain2 his is a supply chain where orders for the merchandise is generated at the stores level on the basis of the sales data captured at the computer terminals. 3asically in this type of supply chain, the demand for an item pulls it through the chain 8) !$sh s$ l' chain2 $n this type, merchandise is allocated to the stores by the management based on the forecasts. =nce a forecast is made, periodically some 8uantities are delivered to the stores. his method is less sophisticated. -ull supply chain has the following advantages: 4 *ince the orders are based on customer demand, there are less chances of stoc&4outs or over stoc&ing 4 -ull approach increases the inventory turnover 4 /hen the demand is difficult to forecast, this is the best method #owever the pull supply chain has some drawbac&s also 4 $t re8uires a more costly and sophisticated information system to support it 4 9or some merchandise, the retailers do not have the flexibility to adjust the inventory to suit the demand. 9or example large volumes may have to be ordered to ta&e price advantage for some merchandise

4 9or products with steady demand li&e bread, eggs, mil& etc, push type is better as the demand can be predicted more accurately L=>$* $C* E -#L*$C"L 9L=/ =9 +" C,$"L* $7 *<--LL C#"$7 he following figure illustrates the physical flow of materials within the supply chain
'C7.=, .$* ,$3< $=7 CC7 ,C * =,C* C<* =+C,

1. +erchandise flows from vendor to distribution centre %. +erchandise flows from distribution centre to stores (. "lternatively merchandise can directly go from vendor to stores Logistics is the aspect of *C+ that refers to planning, implementation and control of the efficient flow and storage of goods and related information from the point of production to the point of consumption. Logistics involves managing inbound transportation, outbound transportation and also the activities underta&en in the retailers distribution centre. "dvantages of using distribution centres Cach distribution centre supplies to several stores. $t is always possible to forecast the combined demand for three or four stores more accurately than a single store 3ecause of the existence of distribution centre, the stores can carry less inventory which results in the overall lower level of inventory. 0same asdvantage as in hub4and4spo&es concept1 $t is easier to avoid going out4of4stoc& as they can always replenish the stoc&s from what is available at distribution centres ,etail store space is always more expensive than that of distribution centre. herefore by &eeping lower level of stoc&s in the stores, the re8uired store space is reduced. .istribution centres are suited to large scale retailers and not to those who have only a few stores. he typical store that will benefit from distribution centre

 .istribution centres are suitable for non4perishable merchandise .istribution centres are suitable for items that have uncertain demand *elling merchandise that needs to be replenished very fre8uently li&e grocery items because if they are delivered directly to stores, the stores will waste lot of time "ctivities that are managed at the distribution centre 1. (ana"ement of in*o$nd trans ortation2 7ow buyers spend a lot of time in coordinating the physical flow of items into their distribution centres. "lthough many manufacturers may pay the transport expenses to the distribution centre, the retailers want to negotiate with truc&ing companies and reduce costs %. Recei%in" and chec5in"2 ,eceiving is the process of recording the receipt on arrival. Chec&ing is to find out whether the receipt is as per the order in 8uantity and 8uality. >oods are also chec&ed for damage, shortages, excess etc (. Storin" and cross doc5in"2 *ome merchandise is stored in the distribution centre in the rac&s and shelves after they are ta&en out of cartons. *ome merchandise is directly allotted to specific stores and they are ta&en directly to the conveyor for onward transportation and these materials stay in the centre only for a few hours A. Gettin" the merchandise read' for dis la' in the store2 his would mean fixing the price tags, putting the apparels on hanger, etc. $t is better to do these at the centre than doing at the store since there is a specific space allotted for these activities at the centre. B. !re are to send the merchandise to store2 Cvery morning, the computer system gives a printout of items to be dispatched to different stores. here is a document called )pic& tic&et and accordingly, the for&lift goes to different areas and pic&s up the re8uired 8uantity of merchandise for different stores H. (ana"ement of o$t*o$nd trans ortation2 +any national level retailers run more than 1II truc&s every day to their stores. 3ecause of the complexity, they use sophisticated routing and scheduling with a view to minimi!e the time ta&en and the cost incurred. G. Re%erse Lo"istics2 his refers to the flow of the materials returned from customer because of defects. his moves bac&wards from customers to stores to distribution centres and finally to vendors. ransportation costs of these can be high as 8uantities are low. Anal'9in" :al-(art;s Distri*$tion and Lo"istics S'stem

"s the worlds largest retailer with net sales of almost JA1K billion for the fiscal year %I11, /al4+art is considered a Mbest4in4class@ company for its supply chain management practices. hese practices are a &ey competitive advantage that have enabled /al4+art to achieve leadership in the retail industry through a focus on increasing operational efficiency and on customer needs /al4+arts corporate website calls Mlogistics@ and Mdistribution@ the heart of its operation, one that &eeps millions of products moving to customers every day of the year. /al4+arts highly4automated distribution centers, which operate %A hours a day and are served by /al4+arts truc& fleet, are the foundation of its growth strategy and supply networ&. $n the <nited *tates alone, the company has more than AI regional distribution centers for import flow and more than 1AI distribution centers for domestic flow. /hen entering a new geographic arena, the company first determines if the area will be able to contain enough stores to support a distribution center. Cach distribution center supports between GB to 1II retail stores within a %BI4mile area. he result is a Mtric&le4down@ effect: truc&s do not have to travel as far to retail stores to ma&e deliveries, shorter distances reduce transportation costs and lead time, and shorter lead time means holding less safety inventory. $f shortages do occur, replenishment can be made more 8uic&ly because stores receive daily deliveries from distribution centers. 7o inventory is stored at /al4+arts distribution centers. /al4+arts fleet of H,BII dedicated truc&s and over BI,III trailers 0*C .igests editorial staff, %I111 are used to pic& up goods directly from manufacturers warehouses, thus eliminating intermediaries and increasing responsiveness. he use of truc&s raises transportation costs but is justified in terms of reduced inventory. +erchandise brought in by truc& to distribution centers is sorted for delivery to stores within %A to AN hours. /al4+art, a pioneer in the logistics techni&$e of cross-doc5in", also has store4specific orders pac&ed and shipped directly to the store by the manufacturer. 3ecause /al4+arts fast, responsive transportation operations are such a major part of the companys successful logistics system, great care is ta&en in the hiring, training, supervising, and assigning of drivers schedules and job responsibilities. 9rom the onset of his retailing career, /al4+art founder *am

/alton recogni!ed the importance of hiring experienced people and of building loyalty not only in his customers but also in his employees. he company hires only experienced drivers who have driven more than (II,III accident4free miles and whom it believes will be committed to customer service. Cross-doc5in" is a practice in logistics of unloading materials from an incoming semi4trailer truc& or railroad car and loading these materials directly into outbound truc&s, trailers, or rail cars, with little or no storage in between. his may be done to change type of conveyance, to sort material intended for different destinations, or to combine material from different origins into transport vehicles 0or containers1 with the same, or similar destination. Ad%anta"es of retail cross-doc5in"

*treamlines the supply chain from point of origin to point of sale ,educes handling costs, operating costs, and the storage of inventory -roducts get to the distributor and conse8uently to the customer faster ,educes, or eliminates warehousing costs +ay increase available retail sales space.

Disad%anta"es of cross-doc5in"

-otential partners donOt have necessary storage4capacities or an ade8uate transport fleet to operate Cross4.oc&ing 7eed of ade8uate $ 4*ystem "dditional freight handling can lead to product damage

RETAILING !RICING DECISIONS he importance of pricing decisions is growing because the customer today has several choices of retail stores. he customers tend to evaluate the value that they receive from different stores. ,etailers offer several benefits li&e availability of variety, convenient location, par&ing, etc. 'alue is the ratio of what they receive 0the perceived benefits1 to what they pay. 'alue P 0-erceived benefits ? price1. Customers opt for the stores that offer higher value.

'alue can be increased either by increasing the perceived benefits or by decreasing the price. " price4conscious customer will go to the store which offers the lowest possible price. " status conscious customer will go to the store which offers high value. 9actors considered by the retailers to set the prices 1. C$stomer rice sensiti%it'2 >enerally as the price is increased, the sales volume goes down. 3ecause fewer and fewer customers will feel that the deal offers a good value. -rice4sensitivity determines the various 8uantities sold at different prices. $f the increase ? decrease of the prices of an item affect the sales volume substantially, then the item is price4 sensitive. 3efore deciding on the retail price, the stores management will consider how price4sensitive the particular item is. $n this connection another term is used and it is called rice elasticit') -rice elasticity P < -ercentage change in 8ty sold ? percentage change in price1 .ifferent items have different levels of price elasticity. 11 Cssential items li&e food, mil&, etc have low elasticity. Luxury goods li&e ', washing machines etc have higher price elasticity %1 he products which has many substitutes will have higher elasticity. -eople may shift from coffee to tea. -eople may shift from watching a movie in theatre to watching it on .'. (1 he luxury products 0as compared to his income1 will be more price elastic. 9or a cler& in an office, items li&e jewelry will be luxurious and so the price elasticity will be high. he price sensitivity of the customers is based on their personal, social or geographical factors and this is a major challenge for retailers. a&e the case of CafD Coffee .ay 0CC.1. his is a coffee bar chain and is located in prime places li&e upscale residential localities, shopping centres, airports, multiplexes etc. hey charge ,s BI to ,s 1BI for various types of coffee. $t is ban&ing on its dDcor, ambience, and experience to play a major role in pulling the crowds 3ased on the price4sensitivity, customers can be divided into segments as below: a1 Cconomic type: hey shop for the lowest price. hey do not give importance for factors other than price b1 Convenience oriented: his type does not enjoy shopping and they shop only when they have to. hey generally choose the nearest locations and spend minimum effort and time to shop. hey do not

mind paying higher prices for reduction in shopping effort. -eople visit the nearest 6irana stores for this purpose. c1 $mage oriented: hese customers are not price sensitive. hey loo& for prestige value while shopping. hese customers will go to aj or -ar& *heraton for dinner. d1 'ariety oriented: hese customers loo& for choices and they li&e the stores that stoc& varieties. hey go to 7allis for saris, >, for jewelry etc e1Loyalty oriented: =ver the years, the customers will start trusting certain stores and will buy only from them even if it is more expensive %. Com etition2 ,etailer can price above or below or at par with the competition depending on his pricing policy. *aravana 3havan &eeps its price much higher than the competition whereas the *aravana *tores &eeps its price much lower than the competition. his because *aravana 3havan has a policy of offering superior value to the customer through the product 8uality whereas *aravana *tores has a policy of offering superior value to the customer through low prices +ost retailers regularly collect competitive price information to see if there is any need to review their own pricing " retailer will have to consider the following factors a= /hat is the competition doing price4wise2 *= ,eview competitor ads and other promotional efforts periodically to get more information c= #ow will the competition react to your pricing policies ,etailers will generally avoid price wars where all parties will have to &eep on reducing prices. (. Cost2 Cost is another important factor on which pricing is dependant. 7ormally price is fixed as cost plus a certain margin. #owever this again is subject to company policy. .ifferent items may have different profit mar& ups. " retailer may decide to intentionally sell some items below cost and use this to pull customers to his store where the customers will buy many more items A. S$ liers2 *upplier or manufacturer also has a strategy with respect the final prices to the customer. hey may not li&e their product image to be spoilt by discounting the prices by retailers. +ercedes43en! does not want their dealers to offer price discounts to customers. 3ut if a +ercedes dealer wants to increase his sale by discounting, it goes against

the policy of the manufacturer. herefore at times, there may be a conflict on interest. *imilarly the supplier does not want his dealer to overcharge also as it may affect the sale he retailer will stoc& many brands of a product and will sometimes consciously promote the brand that offers him higher level of commission B. Le"al and ethical constraints2 a1 he "merican law does not allow the retailer to charge a price lower than his cost. *ome retailers may do this with a view to drive out the competition with an idea to increase the prices later after getting rid of competition, his is called )!redator' ricin"> and is not allowed. b1 (R! <(axim$m Retail !rice=) he manufacturer sets this price so that his price is uniform throughout his mar&et and unnecessary competition among the co4dealers is avoided. +anufacturers try to ensure that no retailer charges price below +,,etail pricing objectives : here can be several objectives while setting the prices at the retail level to the end customers o +aximise the long4term and short4term profits o increase the sales volume or value o increase the mar&et share o obtain a target rate of return on investment o be perceived as fair by all o be consistent o increase the customer flow to the store during lean periods o clear out the old stoc&s o avoid violation of governmental laws o increase repeat purchase -ricing approaches 3roadly, the retailers adopt any one of the three approaches in terms of pricing and they are as below: 1. Disco$nt Orientation: #ere the low process is the &ey and the stores do not offer any other frills or luxury in the shopping experience. he firm )*ubh&sha. 9ollowed this in $ndia. his appeals to the psyche of $ndians who always loo& for value and e8uate the value to prices. Cven some customers from richer sections of society patroni!e such stores %. At-the-mar5et orientation: *uch stores normally fix average prices which are neither too low nor too high. hey target on middle class

customers who are very large in number. "n example of such a store in $ndia is /estside, which focuses on providing value4for4money merchandise for the entire family along with an international shopping experience. hey follow a )store brand only policy. his policy gives them ade8uate flexibility to fix prices as they have better control over their own brands (. U scale orientation2 hese stores stoc& distinctive products, provide high 8uality service and charge higher prices. here is also growing customer segment which loo&s for such stores. CafD Coffee .ay can be an example of this type

he table below offers a representative list of the pricing approaches along with their retail4mix strategies 'ariable .iscounted price "t4mar&et <pscale price price Location 7o par&ing, poor Central +onopoly, compatible layout, business location to inaccessible areas, target segment 7ear competition *ervice *elf4service, *upport from -ersonalised attention, home limited offerings sales people delivery, exchange facility, customi!ed offering "ssortment Limited variety +edium Cxtensive assortment *tore -oor 8uality Comparable $nviting, impressive dDcor, environme fixtures, limited to visual merchandise attractive nt space, untidy competition 7ature of <nbranded, loose 9ast moving Cxclusive brands brands 8uantities brands !ricin" strate"ies

1. E%er' Da' Lo+ !ricin" <EDL!=2 C.L- has been populari!ed by retailers li&e /al4+art. #ere the goods are priced between the +,and a deeply discounted price. #ere )Low does not mean very low prices but a level lower than the regular price.. his is also followed by 3ig 3a!aar and these low prices are stable and offered all he time. 9or C.L- to wor& smoothly, the volumes will have to be very large so that the stores can negotiate better prices from the supplier. 3enefits of C.L- are as below: Less reduction on prices compared to deep discounting. "s these reduced prices are stable, he customers do not delay the purchases ,educed ad expenses as price itself pulls the customers. $n the case of heavy discounting as done during a )sale, more ad expenses are incurred 3etter inventory management since the sale is uniform throughout the year $mproved customer service because the sales are uniform and the number of customers visiting is almost constant and the existing staff can ta&e care. $n the case of #igh E Low pricing, there is a shortage of salesmen during discount sale period %. -i"h-Lo+ !ricin"2 #ere retailers offer higher prices than the competitors C.L- but they conduct sales often giving high discounts. hey resort to ads during sale periods. he sale is done at the end of a season for two reasons. hey are 1. o clear the stoc&s which remains unsold. %1 o attract the price4conscious segment of customers to visit the stores. 3enefits of #L- are as below: *ome merchandise can be used to target different customer segments: 9or example, a high fashion apparel is sold at high prices in the initial days so that the fashion4conscious customers who cannot wait will buy initially. =nce the novelty wears off, the item is discounted and sold in sale and price4conscious customers rush to buy Cnthusiasm is created among customers: " )*ale priod is usally heavily advertised and there is lot of excitement among customers because of discounting, raffles, additional benefits etc. his gives more visibility to the store and there is a good word4of4mouth publicity also

 Customer feels he gets high value: "s the same items are sold at much higher prices throughout the year and discounted at the )sale period, customers feel they get high value #L- is easier to implement as compared to C.L- since C.L- can be done only for &nown branded products so that the customers can compare the prices as they &now the prices. "lso C.Lre8uires large volume of sales so that negotiation can be done with supplier (. Loss leader ricin"2 ,etailer tends to &eep the prices of certain often4 used items li&e eggs, cheaper so that many customers will visit the stores often. /hen they visit, they can be persuaded to buy other high4 priced items. =ther items that they may normally buy with eggs li&e mil&, eggs etc may be priced high. #ere eggs are the loss leaders. he retailer charges higher prices not for normal branded items whose price is &nown to all. #e normally charges high for in4house brands. A. S5immin" ricin": his is a strategy were the retailer sets high prices initially for a product or service and then lowers the price over time. $t allows the retailer to ma&e some 8uic& recovery of costs his is effective only when the demand is price inelastic -rice change by one retailer can be easily matched by another. +ar&et share will be obtained by a retailer who offers penetrative pricing $nventory turnover ratio can be low for s&immed products ,etailer gets negative publicity if he has to reduce the prices 8uic&ly B. !enetration ricin"2 #ere the retailer sets a low price initially to gain acceptance from the customers who use different established brands. he objective of such a retailer could be to increase the mar&et share or sales volume rather than profit maximi!ation. he advantages of penetrative pricing is as below: +ar&et penetration can be achieved very 8uic&ly Creates goodwill among the customers though valuable word4of4 mouth publicity *ince the margin is very low, there are efforts to control costs and this leads to better efficiency Low prices act as barriers for competition to enter

H. !rice Linin"2 ,etailers offer a limited number of pre4determined price positions within a merchandise category. 9or instance in the apparel category, all shirts may cost ,s ABI or ,s HBI or ,s NBI. his is referred to as price lining. he advantages perceived are: Confusion that arises from the multiple choices is eliminated. Customers can choose the shirts at low, medium or high price +erchandising tas& for retailer is simplified. #e groups all within a certain price line and accordingly loo&s for merchandise when he goes to buy. 0UESTIONS -art " 1. /hy is the location decision of retail stores important2 %. /hat factors will you consider while deciding on locating your stores in a particular city2 (. +ention the types of retail locations A. /hat are the general characteristics of a shopping centre2 B. /hat do you mean by )atmospherics2 /hat are the types of atmospherics2 H. +ention some elements of external atmospherics G. /hat is retail brand positioning2 /hat are the three broad strategies2 N. /hat factors do customers consider to measure the service 8uality level2 K. Cxplain briefly the pull4type supply chain management 1I. /hat are the different pricing approaches that retailers employ2 -art 3 1. Location decisions can be complex and a number of factors have to be considered before deciding the location.. Claborate and also give details of types of retail locations %. >ive details of various types of atmospherics that enhance the image of the stores and encourage the customers to visit the stores (. /hat services are provided in the retail stores2 Cxplain in detail the >aps +odel for enhancing the retail service 8uality A. /hat are the types of supply chain management2 /hat benefits accrue because of effective supply chain management2

B. /hat factors would you consider for pricing at the retail level2 /hat strategies are generally followed2