Study of Kirana Stores Project by: Ankeet Kavaiya | Janvi Sakhala
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
INDIAN RETAIL RESEARCH
Understanding Retail Industry and Indian retail scenario is very important for the Retail designers. This course gives a better understanding about the unorganized retail sector through a systematic research approach. Duration - 3 weeks Ms. Nijoo Dubey Mr. Ravishankar
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
DESIGN BRIEF
To familiarize ourself with the unorganized retail sector focusing on Kirana shops.
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
DESIGN PROCESS
SECONDARY RESEARCH
LOCATION MAPPING
VISITING KIRANA
RETAILER SURVEY
SHOPPER SURVEY
INSIGHTS
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > SECONDARY RESEARCH
INTRODUCTION
Retailing in India is one of the pillars of its economy and accounts for 14 to 15 percent of its GDP. The Indian retail market is estimated to be US$ 500 billion and one of the top five retail markets in the world by economic value. India is one of the fastest growing retail markets in the world, with 1.2 billion people. As of 2013, India’s retailing industry was essentially owner manned small shops. In 2010, larger format convenience stores and supermarkets accounted for about 4 percent of the industry, and these were present only in large urban centers. India’s retail and logistics industry employs about 40 million Indians (3.3% of Indian population). KIRANA stores are the small stores that are found in every nook and corner of India. These are convenience stores which are usually located at walking distance. They are the major chunk of stores that from the unorganized retail sector in India. They are family run stores providing self employment. Kirana stores offer credit, home delivery for even small orders, unpackaged foodgrain sold by weight, and maintains personal relationships with customers. With the increase in organized retail the kirana shops are getting effected. This has led the kirana retailers to adopt various different practices from the organized retail. The smarter kirana store operators are tweaking product portfolios and adopting best practices from modern retail. They carry premium products, and have designed their stores to have aisles, security cameras and closed doors to improve hygiene and give them a modern look.
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > VISITING KIRANA
CATEGORIES Depending on the store size and the list of commodities stocked, the Kirana stores are classified as follows:
MICRO STORE • Limited merchandises • < 50 sq ft • Provide Credit
SMALL STORE • Closed space with limited interactions • Limited merchandises • Fixed brands available • Provide Credit
MODERN STORE
LARGE TRADITIONAL • Limited Self Service • Merchandise available with limited variants • Electronic billing available • Provide Credit and Free Home Delivery
• • • •
Open self serving stores Stocks all the products offered Assistance available as per request Electronic Billing
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > VISITING KIRANA
STORE OBSERVATION • The store is located conveniently close to residential ares • Planning of the space is very poor • The products are overlapped by other produtcs thereby restricting its visibility thus hampering visual navigation around the store. • Verbal navigation is the common method by which shoppers participate in the process. • Credit system, home delivery and many such personalized services are conveniently available. • Their window display is generally bags of grains placed outside the shop. • Products with higher profit margin are kept right at the front of the store for quick turn over. • Cosmetics are usually kept behind the retailer inside glass shelves to avoid dust and pilferage. • The store has a very cluttered space, displaying products more than it can hold.
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > VISITING KIRANA
PLACEMENTS OF PRODUCTS IN KIRANA STORES • Food and beauty products are placed in the front. • Home care and laundry products are placed in the back. • The Top shelves are used for stacking bulky products. • The counter space is occupied by jars. • Low shelf life food products are placed next to jars on the counters. • The expensive products are kept behind the retailer to avoid pilferage. • Food grains are placed either outside the store. They act as the window display for the stores.
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > VISITING KIRANA
STORE LAYOUT The stores visited , had similar layouts which can be broadly categorized into 3 types:
L - TYPE
D - TYPE
U - TYPE ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > VISITING KIRANA
FURNITURES AND FIXTURES
ITEM STORAGE
1
MARINAS FOR SHAMPOO
2
WINDOW DISPLAY
3
GRAIN STORAGE
4
1
2
3
4 ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > RETAILER SURVEY
RETAILER OBSERVATION • Retailers are the connecting links between the manufacturer and their shopper. • Retailers maintain a very good relation with the shopper thus gaining their loyalty. • They know their shoppers well, they provide them with special discounts and credit facilities. • The deeper relations between shopper and retailer resulted in the variety of observed behavior such as 1) Credit sales and purchases 2) Arrangement for later item pick ups. 3) Home delivery 4) Reliance on the shop keeper for brand and substitute recommendations. 5) Shopkeeper making effort to procure out of stock and special needs items.
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > RETAILER SURVEY
“Location of the store plays an important role. I was lucky enough to get this place as it belongs to my grandfather.” “I would like to expand but the profit form this business are too less to support a family, maintain a house and at the same time think of expansion.” “I have a daughter so , my business will die with me.”
“ Treat the customers well and they will keep coming back.”
“ I get paid from the company for displaying their devices. “
“ In the next 5 years my shop will most likely be shut down due to the Retail giants like Tesco and Wallmart being set up in India”
“ I know the choice of most of my customers.”
“ My own son would go to these retail shops to buy stuff.”
“ I know the future of my business is not bright and so I would not like my son to take over after me. He is currently studying.”
“ I didnt study in school, I wish I had.” ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > RETAILER SURVEY
RETAILER SURVEY Set of questions were asked to the shop keepers with respect to their shop size, sales etc. The first part sought basic information on floor size, value of inventory and employment, both family and non-family. The second part of the questionnaire sought data on the impact on sales, profits, employment, working hours and high value customers lost, if any. This part of the questionnaire sought information from the respondents with reference to the period after the mall started operations in their area. The questions were asked to the Kiranas around the malls in Bangalore.
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > RETAILER SURVEY
RETAILER SURVEY 11
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > LOGISTICS
LOGISTICS
WAREHOUSE
SHOPPER
DISTRIBUTOR
KIRANA FACTORY
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > SHOPPER SURVEY
PAULINA MATHERS “I love my kiranashopwala (when i lived in bombay that is). The guy would bring me a bottle of bisleri and a pack of smoke every morning before work without me having to call or anything. I haven’t found this level of convenience anywhere in europe . So please remember that us middle class folk also value convenience quite a bit.”
SINDHU MURTHY Grains like wheat and bajra get spoilt in the winter so we store grains only for 2 months as opposed to a year. Also becasue of a lot of variety of grains available i would like to try new varieties. I like kirana shops better because the shopkeeper gives me discounts and also gives me suggestions for a particular brand.
CHITRA VIJAYASARATHY I buy grains in bulk from the wholesaler, I prefer buying masalas in small packets because I like trying out the new masalas in market. We usually go during week ends to buy groceries as we both are working . My husband does the shopping if I am busy with work.
I have an account with the kirana shop, so I can purchase We prefer going to the super market because we can anything from the store even if I dont have money. shop taking our own time with out the shop keeper pestering us. ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > SHOPPER SURVEY
FACTORS INFLUENCING THE DECISION OF SHOPPERS WHILE BUYING
Source : McDaniel, Lam, Hair Introduction to Marketing, Thomas South-Western ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > SHOPPER SURVEY
FACTORS INFLUENCING THE DECISION OF SHOPPERS WHILE BUYING
1) ECONOMIC FACTOR If the economy is strong, consumers have more purchasing power and money is pumped into the thriving economy. If the economy is struggling, the reverse is true. A struggling economy affects factors such as employment and interest rates, and the people may lose consumer confidence. 2) SOCIAL FACTOR Social Factors influencing consumer buying decision can be classified as under: a) Reference Groups Every individual has some people around who influence him/her in any way. Reference groups comprise of people that individuals compare themselves with. Eg.seema brought new Saffola cholestra free oil just because her colleges told her its nice to try new vegetable oil in markets” b) Immediate Family Members c) Relatives 3) Status in the society An individual from an upper middle class would spend on luxurious items whereas an individual from middle to lower income group would buy items required for his/her survival. 4) Personal factor An individual’s personality also affects his buying behaviour. Every individual has his/her own characteristic personality traits which reflect in his/her buying behaviour.A fitness freak would always look for fitness items. Eg. In pune on FC ROAD THERE IS KIRANA STORE NAME ‘muttha’ where he provides healthy drinks for people who go for exercises. Timings 6-8am only for healthy juices.
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > INSIGHTS
ADVANTAGES OF KIRANA STORES • Low Cost Structure : All the kirana stores has very low cost structure and very less operational expense as compared to the supermarket where it has to maintain large no of labour ,maintanence cost of large premise,leasing cost and has to pay hefty amount of taxes. • Location in residential area: As the supermarket are yet to arrive in India so may be they have to build or take the premises on lease which will be away from the residential area.On the other hand the reach of the kirana store to the customer is very high and responsive. • Indian Diversity: Given the diversity and demographic diffrence between the various regions of the country like In northern part of the country people prefer to have the heavy diet with ghee and in the southern part they will prefer to have dishes made of rice. • Personalization: Kirana Stores are loved as they seem to be an extension of the family itself. Buyers are greeted by names and are treated well. There is a constant comfort and warmth which is settling. • Store Credit: Store credit is a common practice at the Kirana stores. The buyer likes to take privilege of such facilities, it helps them create better trust.
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > INSIGHTS
DISADVANTAGES OF KIRANA STORES • Cluttered displays and chaotic walking space. • Less space and many products. No breathing space hence limited browsing. • Since these stores are still evolving, buyers largely have to depend on cash payments. • Due to constraint of space, only products which are commonly used are stacked, thus offers limited choice. • Low profit for the retailer :Since the capital and operation are low, the profit is low. • High Pilferage : The products are in the open. There is low man power, and no security measures like cameras, which results in high pilferage. • Lack of Brand image. • The super markets come up with exciting offers and huge discounts which can not be matched by the Kirana stores. This adversely effects the Kirana store.
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
KIRANA > INSIGHTS
WHY DOES A CUSTOMER PREFER KIRANA STORE • No need for prior planning • Usually walking distance from the house • Can be approached anytime for immediate need • Free home delivery • Credit system • Procuring out of stock products for the shopper • Get discounted price ( prices are less than mrp)
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
1) DIPLOMA PROJECT -SRUTHI SIVAUMAR 2) DIPLOMA PROJECT- RITIKA K 3) DIPLOMA PROJECT- CHANDNI GARGH NOUN PROJECT ICONS CREDITS
BIBILIOGRAPHY:
• • • • •
Claire Jones Juan Pablo Bravo consmind.com Mister Pixel Konstantin Velichko
RESEARCH PAPER Impact of Malls on Small Shops and Hawkers Author - Anuradha Kalhan
ANKEET KAVAIYA | DESIGN FOR RETAIL EXPERIENCE
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