Reliance Fresh
Reliance Fresh
Reliance Fresh
Executive Summary
Retailing is the interface between the producer and the individual consumer buying for
personal consumption. This excludes direct interface between the manufacturer and
institutional buyers such as the government and other bulk customers. A retailer is one who
stocks the producers goods and is involved in the act of selling it to the individual consumer,
at a margin of profit. As such, retailing is the last link that connects the individual consumer
with the manufacturing and distribution chain. The retail industry in India is of late often
being hailed as one of the sunrise sectors in the economy. AT Kearney, the well-known
international management consultancy, recently identified India as the first most attractive
retail destination globally from among thirty emergent markets. It has made India the cause
of a good deal of excitement and the cynosure of many foreign and domestic eyes. The entry
of foreign and Indian retail giants like Wal-Mart, Metro, Reliance, Birla, Tata etc. made
Indian market more competitive which is at cut throat level. So how retailers can reach to
their end customers, to win the mind share and increase the basket size of each shopping trip.
India retail industry is the largest industry in India, with an employment of around 8%
and contributing to over 10% of the country's GDP. Retail industry in India is expected to rise
25% yearly being driven by strong income growth, changing lifestyles,
and
favourable
demographic patterns.
It is expected that by 2016 modern retail industry in India will be worth US$ 175200 billion. India retail industry is one of the fastest growing industries with revenue
expected in 2007 to amount US$ 320 billion and is increasing at a rate of 5% yearly. A
further increase of 7-8% is expected in the industry of retail in India by growth in
consumerism in urban areas, rising incomes, and a steep rise in rural consumption. It has
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further been predicted that the retailing industry in India will amount to US$ 21.5 billion by
2010 from the current size of US$ 7.5 billion.
The growth of scope in the Indian retail market is mainly due to the change in the
consumers behaviour. For the new generation have preference towards luxury commodities
which have been due to the strong increase in income, changing lifestyle, and demographic
patterns which are favourable.
Reliance Retail is the retail chain division of reliance industries of India which is
headed by Mukesh Ambani. Reliance has entered into this segment by opening new retail
stores into almost every metropolitan and regional area of India. Reliance plans to invest
Rs.25000crores in the next 4 years in their retail division and plans to begin retail stores in
784 cities across the country. The reliance fresh supermarket chain is Rs.25,000crores
venture and it plans to add more stores across different g, and eventually have a pan-India
footprint by year 2011to the company.
As the twentieth century has come to and we have moved in to third millennium , we
can see many development and changes taking place around us with all the industries and
firms within each industry trying to keep pace with all the industries and firm within each
industries trying to keep pace with the changes and diverse need of people . Marketer have
regarded customer as the king and evolved all activities to satisfy him or her, this concept
gaining more momentum and importance today.
More than a century ago, the father of our nation, Mahatma Gandhi, had made
visionary and deep meaningful statement at Johannesburg, South Africa in 1980. A customer
is the most important visitor of our premises. He is not dependent on us .We are
dependent on him. He is not interruption on our work. He is the purpose of it and not
an outsider on our premises. He is a part of it. We are not doing him favour by serving
him.
Today the entire firm engaged in a process of creating a life time value and
relationship with customers. This report start with discussion on the diversity of consumer
behaviour and the need for studying consumer buying behaviour and consumer as a related
field of marketing .this can be largely be attributed to the prevailing market situation .Today
the company image is built and made known by its customers. Thus success of the firm
determined how effective it has been in meeting the diverse consumer need and wants by
treating each customer as unique and offering products and services to suit has or her need.
Consumer buying behaviour will be a primary force in determining how this
transition will evolve. Getting closer to the customer in todays highly competitive landscape
is essential for the entire industry and is no longer just a retail issue. It requires all
organisations across the supply chain to work as a single enterprise, sensing and responding
rapidly to consumer demand in a co-ordinated manner. Detailed analysis of the changing
patterns of consumer demand, shopping trends.
RELIANCE
"Growth has no limit at Reliance. I keep revising my vision. Only when you
can dream it, you can do it."
Dhirubhai H. Ambani
Founder Chairman Reliance Group
December 28, 1932 - July 6, 2002
RELIANCE GROUP
The Reliance Group, founded by Dhirubhai H. Ambani (1932-2002), is India's
largest private sector enterprise, with businesses in the energy and materials value chain.
Group's annual revenues are in excess of USD 27 billion. The flagship company, Reliance
Industries Limited, is a Fortune Global 500 company and is the largest private sector
company in India.
Backward vertical integration has been the cornerstone of the evolution and growth
of Reliance. Starting with textiles in the late seventies, Reliance pursued a strategy of
backward vertical integration - in polyester, fibre intermediates, plastics, petrochemicals,
petroleum refining and oil and gas exploration and production - to be fully integrated along
the materials and energy value chain.
The Group's activities span exploration and production of oil and gas, petroleum
refining and marketing, petrochemicals (polyester, fibre intermediates, plastics and
chemicals), textiles and retail. Reliance enjoys global leadership in its businesses; The Group
exports products in excess of USD 15 billion to more than 100 countries in the world. There
are more than 25,000 employees on the rolls of Group Companies. Major Group Companies
are Reliance Industries Limited (including main subsidiaries Reliance Petroleum Limited and
Reliance Retail limited) and Reliance Industrial Infrastructure Limited.
[1]
It was founded by
the Indian industrialist Dhirubhai Ambani in 1966. Ambani has been a pioneer in introducing
financial instruments like fully convertible debentures to the Indian stock markets. Ambani
was one of the first entrepreneurs to draw retail investors to the stock markets. Critics allege
that the rise of Reliance Industries to the top slot in terms of market capitalization is largely
due to Dhirubhai's ability to manipulate the levers of a controlled economy to his advantage.
Though the company's oil-related operation forms the core of its business, it has diversified
its operations in recent years. After severe differences between the founder's two sons,
Mukesh Ambani and Anil Ambani, the group was divided between them in 2006. In
September 2008, Reliance Industries was the only Indian firm featured in the Forbes's list of
"world's 100 most respected companies"
RELIANCE FRESH
Reliance fresh is the retail chain division of reliance industries of India which is headed by
Mukesh Ambani. Reliance has entered into this segment by opening new retail stores into
almost every metropolitan and regional area of India. Reliance plans to invest Rs.25000crores
in the next 4 years in their retail division and plans to begin retail stores in 784 cities across
the country. The reliance fresh supermarket chain is Rs.25000crores venture and it plans to
add more stores across different g, and eventually have a pan-India footprint by year 2011.
The super marts will sell fresh fruits and vegetables, staples, groceries, fresh juice bars and
dairy products and also will sport a separate enclosure and supply-chain for non-vegetarian
products. Besides, the stores would provide direct employment to 5lakhs young Indians and
indirect job opportunities to a million people, according to the company. The company also
has plans to train students and housewives in customer care and quality services for part-time
jobs.
BACK GROUND
We can see many examples of businesses where, first we grow and then think of
expanding but Reliance is quite different. Reliance has developed such huge amount of
resources and capital over the years that whenever it steps into any segment it is not required
to wait for growing signal, thats why it always thinks of expanding without any boundaries.
Reliance retail is next Step by RIL which will be a pan India project.
Reliance Fresh is the retail chain division of Reliance Industries of India which is headed by
Mukesh Ambani. Reliance has entered into this segment by opening new retail stores into
almost every metropolitan and regional area of India. Reliance plans to invest Rs 25000crores
in the next 4 years in their retail division and plans to begin retail stores in 784 cities across
the country. The Reliance Fresh supermarket plans to add more stores across different and
eventually had a pan-India footprint by year 2011.
The super marts will sell fresh fruits and vegetables, staples, groceries, fresh juice
bars and dairy products and also will sport a separate enclosure and supply-chain for nonvegetarian products. Besides, the stores would provide direct employment to 5lakh young
Indians and indirect job opportunities to a million people, according to the company. The
company also has plans to train students and housewives in customer care and quality
services for part-time jobs.
The company is planning on opening new stores with store-size varying from 1,500
sq ft to 3,000 sq ft, which will stock fresh fruits and vegetables, staples, FMCG products and
dairy products. Each store is said to be within a radius of 1-2 km of each other, in relation to
the concept of a neighbour store. However, this is only the entry roll-out that the company
has planned. Bangalore is said to have 40 stores in all by the end of the year.
In a dramatic change due circumstances prevailing in UP, West Bengal and Orissa,
It was mentioned recently in News Dailies that, Reliance Retail is moving out stocking.
Reliance Retail has decided to minimize its exposure in the fruit and vegetable business and
position Reliance Fresh as a pure play super market focusing on categories like food, FMCG,
home, consumer durables, IT, wellness and auto accessories, with food accounting for the
bulk of the business.
The company may not stock fruit and vegetables in some states, Orissa being
one of them. Though Reliance Fresh is not exiting the fruit and vegetable business altogether,
it has decided not to compete with local vendors partly due to political reasons, and partly
due to its inability to create a robust supply chain. This is quite different from what the firm
had originally planned. When the first Reliance Fresh store opened in Hyderabad last
October, not only did the company said the stores main focus would be fresh produce like
fruits and vegetables at a much lower price, but also spoke at length about its farm-to-fork
theory. The idea the company spoke about was to source from farmers and sell directly to the
consumer removing middlemen out of the way.
Reliance started its retail operations of Reliance Fresh stores with following supply
chain model. Procuring directly from the farmers and operating with moderate margin
but mass selling was the key to Reliance fresh operation for first few months. The
following figure depicts the first Reliance fresh model.
FARMERS
FARMERS
FARMERS
CATEGORY
CATEGORY
CATEGOR
Y3
N
POINT/UNI
T OWN
RELIANCE
LOGISTICS
PROCESSING
RF
UNIT/POINT
RF
Reliance own Logistics
RELIANCE
RELIANCE
RELIANCE
FRESH
FRESH
FRESH
OUTLETS
OUTLETS
OUTLETS
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Whole Sale Trading (WST) Reliance formalized its second supply chain model to shift itself
from grocery retailer to grocery supplier by focusing and establishing itself in Mandis.
SOIL CONDITIONS,
CLIMATE CONDITIONS,
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Logistics and brought to collection Processing centres where quality check and other
required processing is done.
In processing centres workers wearing balaclavas, woollen trousers and bulky jackets
work inside a room kept at a constant 3oC, peeling and chopping vegetables, spinning
them dry and then heaping them in small plastic packets before placing them in plastic
transport crates. At the other end of the 5,000-sq-m warehouse, men unload crates of
fruits from a truck pulled up to a spotless loading dock. A quality-control expert samples
every tenth crate; if the fruits are good a team will make ready them for delivery within
hours to Reliance fresh stores around different places like U.P and as far away as
Hyderabad and even Mumbai (formerly Bombay). If they are not, workers will inspect
the entire shipment and discard anything below standard.
3) Merchandise from these collection processing centers are collected and loaded for
Wholesale mandis. As this merchandise is to be made available by 4 A.M in morning
thus deliveries in trucks are sent at time depending upon:
TRANSIT TIME. Time required reaching destination i.e. mandis.
MARGIN TIME. Time period between a truck reaching mandi and then unloads can be
2 to 3 hours.
LOADING AND UNLOADING TIME.
4) From mandis where the trucks have been unloaded, roadside vendors and pull carters
Buy fruits and vegetables to supply in households.
5) In case still some vegetables and fruits are not sold reliance logistics own
Transportation sends them to reliance fresh stores.
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RESEARCH DESIGN
TITLE OF THE RESEARCH TOPIC
Study of Consumer Buying Behaviour with special reference to Reliance Fresh, Mumbai.
RESEARCH OBJECTIVE
To know about the consumer awareness towards Reliance Fresh.
To study consumer buying behaviour of customers in Reliance Fresh, Mumbai.
To know about the consumer awareness towards Reliance fresh.
To understand the consumer response and their preferences.
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RESEARCH METHODOLOGY
It is the specification of the methods and procedures used for acquiring the
information needed. In short, it is the master plan for conducting the research study. It should
be noted that a research methodology is unique to a research design. It includes:
Research-Type
Sample size
Sampling procedures
Time of collection
Limitation of research
Methodology:
The methodology of research study was descriptive research. Descriptive research includes
surveys and fact finding investigation. The major purpose of descriptive research is,
description of state of affairs as it exists at present.
Type of Research
Descriptive type research has used to complete the project. This research is based on fact
finding enquires and the variables are totally independent and uncontrollable.
Data collection:
Primary Data
Primary data of research are collected from direct resources (customer of Reliance fresh)
through questionnaire.
Secondary Data
Secondary Data which are used for research to know the history scope of Retail industry are
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collected from already available resources like internet and other sources.
Sampling Technique
Simple Random sampling is used
A sample size of 50 respondents has been taken
Data Collection: Primary data for research are collected from direct resources i.e. customer of
Reliance fresh who visit retail outlet through questionnaire.
Sample size
50 respondents has selected as sample size for research
Data representation technique and tools
Columns chart & Pie chart has used for representation.
Time of collection
Tine of collection of my research study was 1 month of analysis the catchment area, Footfall
and average Ticket size of the customers. In one month time I was able to understand the
trend of the store and also how various store related activities like dumping, indenting,
markdown, assortments of the product were done.
Limitation of the study:
The study was limited to few Reliance Fresh outlets which is located Mumbai There can be
response bias from the respondents, which limits the validity of findings.
Lack of expertise
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HYPOTHESIS OF RESEARCH
A research hypothesis is a specific, clear, and testable proposition or predictive statement
about the possible outcome of a scientific research study based on a particular property of a
population, such as presumed differences between groups on a particular variable or
relationships between variables. Specifying the research hypotheses is one of the most
important steps in planning a scientific quantitative research study. A quantitative researcher
usually states and a prior expectation about the results of the study in one or more research
hypotheses before conducting the study, because the design of the research study and the
planned research design often is determined by the stated hypotheses. Thus, one of the
advantages of stating a research hypothesis is that it requires the researcher to fully think
through what the research question implies, what measurements and variables are involved,
and what statistical methods should be used to analyze the data.
Testing of Hypothesis:
Sales
Weekdays Average = 62,708.23
Weekends Average = 95,086.73
H0 (Average sales of weekdays = Average sales of weekend)
H1 (Average sales of weekdays Average sales of weekends)
H0: There is a significance difference between expectation and satisfaction level of sales
H1: There is no significance difference between expectation and satisfaction level of sales
At 5% level of significance H0 is accepted
Customers
Weekdays Average = 380.10
Weekends Average = 482.8
H0 (Average sales of weekdays = Average sales of weekend)
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Purchase decision making pattern that is a complex amalgam of needs and desires,
and is influenced by factors such as the consumer's (1) societal role (parent, spouse, worker,
etc.), (2) social and cultural environment and norms, and (3) aspirations and inhibitions.
Buying Behaviour is in the Advertising, Marketing, & Sales and Purchasing &
Procurement subjects. A purchase process follows strong purchasing intentions. This involves
a series of selection, including the type of retail outlet as well the specific brand on service to
use. The consumers purchase then leads to various outcomes. One such outcome is
satisfaction as a result of direct experience in using the brands. Satisfaction will affect the
consumers belief about the brand. Other outcome is dissatisfaction and post sale doubt.
Many ad agencies conducted an in-depth study of consumer buying behaviour and
found that they all crave for peer acceptance and parental non-influence.
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once a week
14%
6%
30%
twice a week or
more
once a month
21%
twice a month
29%
thrice a month
I was mainly concerned about those customers who come at the store often. So, according to
my objectives I asked them first how frequently he/she visits the store.
In response I got this statistics
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Live in the
same locality
Relatives
1%
1%
18%
Mail
5%
53%
Brochure
22%
News Paper
Others
Next I asked them how they got to know about Reliance Fresh and I saw that
53% of the respondents live in the same locality and so they automatically get to
know about Reliance Fresh as they share the same locality.
22% of them have come to know through their friends and relatives.
Very few people got to know through mail and other sources, i.e. 1% each.
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Highly
Dissatisfied
2%
10%
10%
43%
Dissatisfied
35%
Moderate
Satisfied
Highly Satisfied
According to the survey, majority of the respondents are satisfied with the price and offers
available at store. I got
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4%
Highly
Dissatisfied
5%
23%
Dissatisfied
18%
Moderate
50%
Satisfied
Highly
Satisfied
4% are dissatisfied.
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FINDINGS
I have two kinds of findings from my project. Some I got from the survey among the
customers and others I got from my observations.
Let us first discuss what I found from the survey.
53% of the customers who come to Reliance Fresh (DP) are mainly local people. It
means local people are very much aware of this store rather than outside of the
locality.
59% of the customers prefer to visit the store once in a week or twice in a week. That
means they prefer to visit the store frequently. They buy their products on weekly
basis.
51% of the customers are satisfied with the products available, though 48% of total
customers fall on the dissatisfaction category and they need more variety of brands.
69% of the customers are satisfied with the display of products. That means they find
their products very easily when they visit the store.
53% of the customers are satisfied with the price and offers provided by the store,
though 45% of total customers are not satisfied fully. They think more discounts
should be provided on products.
60% of the customers dont avail basket offers. But those who avail it are satisfied
with the combination of products. Some customers are not aware of the combinations
offered.
39% of the customers are satisfied with the price and quality of Reliance Private
Label products. But 17% of the customers are not availing it. Many of the customer
said that the price of private label product is high compared to other brands.
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50% of the customers dont avail home delivery facility. One reason is that, reliance
provides home delivery facility within 2km around the store. So, the customers who
do not live within 2km of radius from the store cant avail this facility. Another reason
is, if customers shop for at least Rs. 700/- then only they can avail this facility. But
36% of total customers are satisfied with this facility.
62% of the customers are satisfied with the billing speed and check out time.
73% are satisfied with the overall customer service at the store.
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LIMITATIONS
During the project I faced certain limitations. All customers did not respond to our
survey. That may be because of two reasons. Some of them were in hurry; they didnt have
time for answering the questions. Some of them were not interested to answer the survey. The
project has some limitations because it is totally based on efforts of individuals.
It is totally based on personal efforts of individuals.
Some of the consumers are unable to understand the questionnaire.
Language is one of the worst problem, some of the consumers are unable to
understand English.
Some consumers are not interested in filling questionnaire.
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CONCLUSION
It can be concluded that behaviour pattern of the customer is influence by the product and
service quality price and brand, consumer buying pattern is influenced by the store layout,
ambiance, behaviour of sales personnel, and after sales service of Reliance Fresh. Most of the
customers are ready to buy some product from another retail outlet, if they are not finding
good quality of products there in Reliance Fresh. Means customer want up gradation of the
product at Reliance Fresh. So that Reliance Fresh can face a tuff competition with the other
retail outlet. With the growing retail concept Reliance Fresh is really a fresh air in the arena
of vegetable and fruit market. But due to some political and local problems all Reliance stores
are not allowed to keep vegetables and fruits according to their goal.
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Name: _________________________________________
Age: _______
Sex: __________
Phone no.:______________
b) Twice a week
c) Once a month
b) Relatives
c) Brochure
d) Mail
4. How would you rate Reliance fresh regarding the price and promotion offers
available?
a) 1
b) 2
c) 3
d) 4
e) 5
5. Who do you think is the closest competitor of Reliance Fresh?
a)
Food Bazar
b) Big Bazar
c) Spencer
e)More
6. How do you rate Reliance Fresh Regarding customer service?
a)
1
b) 2
c) 3
d) 4
e) 5
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d) Spinach
7. Are the Price of Reliance fresh is lower than the other competitor?
Yes ( ) No ( ) Equal ( ) no idea ( )
8.
()
Good
()
Fair
()
Poor
()
10. What do you mostly shop at mentioned store? (You can tick more than one)
Fruits & Vegetables
()
Grocery
()
Food Items
()
Non-Food Items
()
()
Brand
()
Price
()
()
()
Spencer
()
Big Bazaar
()
()
Others
()
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()
No
()
14. Did you get help from CSA (Customer Service Associates) / Staff when asked?
Yes
()
No
()
Sometimes
()
Never
()
15. How 'likely are you to recommend Reliance Fresh to a friend or relative?
Would you say the chances are?
Excellent
()
Good
()
Fair
()
()
Poor
16. Will you like to switch your brand preference if you get some promotional scheme with
another brand?
Yes
()
No
()
Some time
()
Never
()
()
Friends
()
Relatives
()
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18. Are you buying the basket offers available in Reliance fresh?
a)
Yes
b) No
19. Are you satisfied with the combination of products of the basket offer in Reliance
Fresh?
a)
Yes
b) No
20. What was the reason for the delay between the purchase decision and the actual purchase?
1. Financial constraints
2. Waiting for more innovative product
3. Waiting for market response
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