RETAIL MARKETING

ASSIGNMENT - 2

PROJECT REPORT ON

NAMDHARI's FRESH
Retailing of Fresh Fruits & Vegetables

Prepared by
MANJUNATH N
Roll No: EPGCMM-11-024
Namdhari Fresh (NF), a unit of Namdhari Seeds Private Limited – a leading vegetable seed seller
and exporter, The Chain was set up in 2000 at Bangalore with the objective of filling the segment
of premium green grocers. It is a certified Organic exporter and has a pack house with British
Retail Consortium (BRC) and HACCP standards. NF handles more than 1000 tonnes of Fresh
Fruit & Vegetables in domestic and international markets (www.namdharifresh.com). NF deals
with 40 different Fruits & Vegetables(F&V) with two companies to co-ordinate the F&V retail
operations: Namdhari Farm Fresh deals with back end operations and Namdhari Agro Fresh with
the front end operations. NF had corporate farm on 350 acres within its premises.
The company offers fruits and vegetables for retail purchase. The fruits and vegetables offered
for sale (currently 40 varieties) are grown at the company's own production centers. Besides the
Domestic market, the produce is also meant for export to Europe, Australia and the Middle East.
The Company currently operates stores in Bangalore and Delhi.
Retail Strategy
Store & location:
NF has its own chain of the retail outlets (18 in Bangalore and 3 in Delhi and one in Ludhiana) to
sell F&Vs, including salad bars. In addition to this, they also export and sell to the institutional
buyers such as five star hotels.
All the stores are run by NF in rented premises with store ranging from 800 to 2000 sq. ft. bars.
A store carries more than 70 SKUs of F&Vs and had a staff of 10-12 persons including one
manager. The daily footfalls ranges from 200 to 250 per day during week days and 300 to 350
during week-ends.
The outlet carries only vegetarian food. The share of the F&V in the total store sales is 40%.
The location is based on the well developed residential area with the cosmopolitan setup.

Pricing:
Namdhari Fresh based out of Bangalore operates their own farm in the outskirts of Bangalore to
provide fresh fruits and vegetables with better quality with the cost effective pricing. The prices
of the F&Vs were determined once in every three days based on the procurement price, market
price, overheads and margins.

Merchandise Mix:
2000 Farmers/growers network, Full fledged green vegetables and fruits section. Namdhari Fresh
Supermarket carries a medium merchandise width and depth as compared to an unorganized
setup.
The Store normally stock Fresh Produce sourced from their own facilities (Regular products)
while the rest are sourced from Major brands (Additional products)
Regular Products (Stocked at all stores)

 Cole Crops -Broccoli, Cauliflower, Brussels Sprout,Red Cabbage, Chinese Cabbage,

Cabbage Green.
 English Range -Asparagus, Babycorn,Sweet corn, Zucchini, Leeks, Colored Capsicum.
 Salad Range -Cucumber (Mini/European/Kakkari),Novelty Tomato (Cherry/Pearl/Salad),
Lettuce (Iceberg/Lolarosa/Lobi.
 Gourds -Bottle gourd, Bitter gourd, Ivygourd(Tindori), Sponge gourd, Ridge gourd,
Pumpkin.
 Indian Vegetables -Mangetout Pea / Snow Peas, Green Peas, Haricot Verts, Beans, Carrots,
Okra, Aubergines(Eggplants), Hot Pepper(Chillies).
 Herbs - Sage, Rosemary, Thyme, Oregano, Lemon Grass, Basil, Coriander Leaves, Curry
Leaf, Dill.
 Leafy Greens - Palak, Pokchoy, Amaranthus, Chinese Kale, Mustard Leaf, Choisum.
 Fruits- Watermelons, Melons, Physalis, Passion Fruit,Green
Apple,RedApple,Berries,Strawberries,Grapes,Fig,Pomegranate,Papaya,Mango,Chikoo,Kiwi.
Additional Products (Stocked at large stores)

 Packaged Drinking Water

 Chocolates - All Major Brands.
 Pulses and grains - All Major Brands.
 Baked Goods - Breads and Cake.
 Dairy products - All Major Brands.
 Italian Sauces - All Major Brands.

Advantage:

 Small stores, easily manageable, lesser rentals, lesser staff

 Limited assortments
 Own freshly produced fruits & vegetables
 Less procurement of other brands
 Replica of a khirana shop in a organized way, consumer can easily relate

Focus Areas:

 Perishable nature of products- need fast turnover in stores.

 Limited stores compared to leading players
 Rising cost of operations due to higher cost of production, fuel etc
 To seek geographical expansion into other states
 Seek diversification by offering fruits and vegetables for purposes such as weddings,
festivals in well packaged forms apart from household consumption.
 Build brand equity for the brand through advertising and promotions.
 Rising competition in organized retail sector from new retail chains in fresh fruits and
vegetables category such as Reliance fresh, Big apple.
 Unpredictability and variability of monsoons.
 Rising labor and Transportation Costs

Flipkart is in talks to buy Indian grocery chain Namdhari’s Fresh, people familiar
with the deal said, as the homegrown etailer majority-owned by Walmart seeks to
expand its food and grocery segment. “This business may be of interest to
Walmart’s agri supply chain,”
 MARKETING STRATEGIES FOR PERISHABLE FRUITS AND
VEGETABLES RETAIL SEGMENT IN SUPERMARKET
* Dr. Anitha Ramachander
** S. Prasanna Venkatesh

ABSTRACT

The recovery in consumer spending is visible across almost all the industry sectors especially in food and
grocery. Revival and growth of Indian retail industry in the past few months are due to the early festive season.
But at the same time, spending will not be as high as the previous years. Consumer's mentality and sentiment
has changed as affected by the global situation. Now consumers are adopting a mindset of "Shift to thrift-
approach. Consumers are focusing more on value from the offerings, whereby they want to save money
everywhere and hence are seeking lower priced, acceptable quality options around food and grocery and
other important purchases. Considering the recent economic and market changes, it is mandatory for the
retailers to revisit on their value and marketing strategies to map the customer's new mindset and their
spending habits. Keeping the above consideration, this study seeks to find out the supermarket's value
delivery in terms of price, proximity or location, atmospherics, merchandise mix, customer service and
differentiation in offerings etc. Based on these analysis, business models for supermarket were proposed to
match the consumer's new mindset and preference.

Keywords: Value proposition, fruits and vegetables retail, modern supermarkets

1.0. Background of the study across almost all the industry sectors especially in
food and grocery. Revival and Growth of Indian retail
Falling stock indices, declining housing prices, industry in the past few months are due to the early
growing inflation and global crisis made the Indian festive season of the year and changing consumer
consumer's confidence index decline by 26.5 points demographics and an improvement in the quality of
between January 2008 to march 2009. But the life of urban people. Consumer spending seems to
market status is gradually improving, according to be promising for next three quarters. But at the
report titled "Indian consumers in the downturn" by same time, spending will not be as high as the
Boston consulting group, worst is over for the previous years. Consumer's mentality and sentiment
retailers and industry, whose market size has been has changed as affected by the global situation.
increasing and is likely to witness slow and steady Now consumers are adopting a mindset of "Shift to
growth. The recovery in consumer spending is visible thrift" approach. Consumers are focusing

Director, Adarsh Institute of Management & Information Technology, Bangalore

Email: [email protected]
Assistant Professor, Indian Business Academy, Bangalore
Email: [email protected]

Adarsh Journal of Management Research 51

more on value from the offerings, whereby they want consistent value. Keeping the above challenges in
to save money everywhere and hence are seeking mind, this study is an attempt to find out the value
lower priced, acceptable quality options around food proposition of modern retail outlets in food and
and grocery and other important purchases. grocery sector especially in the fresh fruits and
vegetables segment. This study seeks to find out
Considering the recent economic and market
the supermarket's value delivery in terms of price,
changes, it is mandatory for the retailers to revisit
proximity or location, atmospherics, merchandise
on their value and marketing strategies to map the
mix, customer service and differentiation in offerings
customer's new mindset and their spending habits.
There are laggards who have not tuned their retail etc. There are various studies conducted on different
business according to the changing trends will lose formats and their deliverables, but there is little
business, recent slowdown of south literature available on analyzing the realign strategies
Indian based supermarket and convenience store and business model of retailers towards this micro
(subiksha) is the classical example. Another segment. This study is an attempt to find out the
nationwide major supermarket chain store forced value delivery by these modern retail outlets
to shut down many outlets due to the lack of especially in fruits and vegetables segment.
support network.
2.0. Review of Literature
Leanings of the recent past made the Indian
2.1. Literature review
supermarket business to revisit on their value
proposition and business model. Supermarket Various studies have been conducted on the growth
format is more risky proposition facing huge of modern retail formats in India. Few of these
competition from local grocer especially in studies are relate to food and grocery retail formats.
perishable fruits and vegetables segment. Hence it In a study by Coca Cola retailing research council
is need of the hour for modern supermarket to
Asia (CCRA) on food retail format success in Asia,
realign their marketing strategy in perishable goods.
it was evident that food retailers were adding more
Keeping the above challenges in mind this study is
value through innovative formats. Three modem food
an attempt to find out the realign strategies of
retail fonnats begin to emerge as the primary formats
supermarket in Bangalore city.
across the region: hypennarkets, supermarkets and
All these modem outlets (irrespective of the formats) convenience stores. Although supermarkets have
are providing quality merchandise in packed foods, become well entrenched on the Asian landscape
non food items and other groceries of either standard (being the first modern retail format to enter most
brands or their own private labels. But still, the markets), convenience stores and hypermarkets
consumers are dependent on mobile vendors or have-been leading the outlet expansion race in recent
nearby vegetable market for fresh vegetables and years, and hypermarkets have even become the
fruits. Not many players are able to succeed and most significant format in some markets. Especially
add value to this micro segment of fresh fruits and in India, most of these formats are a new experience
vegetables in terms of freshness, merchandise for shoppers. Their annual spending on modern food
quality, pricing etc. Only a few players attempted
retail formats are considerably low compared to other
to concentrate on fresh fruits and vegetables (F&V).
markets in Asia. Indian shoppers are highly price
One of the major challenges of these players is a
sensitive in food shopping, therefore a format with
lack of skill in well - oiled system of replenishment
wider choice and low prices will attract shoppers in
or back-ward integration. Due to this reason, these
this region. A study on growth of retail formats by
players are having a hard time in delivering

Vol 3 Issue 1 March 2010 52

Prof. Piyush Kumar Sinha clearly reiterates that a country from first-tier cities to second-tier and then
retail format is the vehicle for delivering value a country from first-tier cities to second-tier and then
preposition and positioning the concept of the stores third-tier cities, and from processed to semi
in the minds of customers. The author further argues processed to fresh products. The study also dealt
that retail formats is not only about physical with the challenges and opportunities that modern
structure, but to provide value added service and retailing was posed with various stakeholders in the
make customers feel v\/orth of the value. supply chains, especially for traditional retailers,
In a study on format choices of food and grocery farmers, and consumers. The paper concludes by
retailers, it was found that format choice is an surmising what lessons other countries' experiences
important decision making by the consumers as in the supermarket revolution have for India which is
part of the information processing of his buying on the threshold of a major structural change in
process. A store is chosen based on the confidence retailing. The expectations and concerns are high.
that the customer has regarding the store; about Accordingly, India must form its own model of retail
the nature and quality of product and service he will development to meet its priorities, learn from
receive. In the Indian scenario formats have been challenges that others have faced, and successful
found to. be influencing the choice of store as well examples of strategies for "competitiveness with
as orientation of the shoppers (Sinha and Uniyal, inclusiveness" among traditional retailers,
2005). The same study seeks to analyze the various wtTolesaler, and farmers entering an era of rapid retail
factors influencing decision making process of transformation and concomitant food system
customers in choosing a store format. The change. (International food policy and research
exploratory study brought out five different formats institute (IFPRI), February 2008)
that existed in the food and grocery sector. With Many of the above studies focus mainly on the store
this it also identified combinations of the seven choice format and consumer preference in the food
parameters which have given rise to some generic and grocery retail segment. Some of the above
retail fomnats. It also helped identifying the important studies elaborated on the success of supermarket
factors which affect consumer format choice
formats in India and suggested some alternative
decisions. The findings also provide details which
customized format to cater to the local needs. But
helps the retailers in designing an efficient retail
none of the studies concentrated on the entire
package for offering to their customers.
business model and realigning strategies of current
Another research study by IFPRI, focused on the modern retail specifically on the fruits and
emergence of modern retailing with respect to food vegetables. Very few studies are available on
and its implications on various stakeholders in the consumer's perception on modern retail formats,
food supply chain. While the study briefly further and almost hardly any literature is available on
reviewed the US and European experience and analysing the strategy and business model of
focused on the developing countries of Latin America supermarkets in fruits and vegetables segment.
and East Asia (including China), where the Therefore this study is an attempt to find out the
supermarket revolution started in the early to emerging and realigning strategies of modern retail
mid-1990s. The study looked at the patterns of the format in food and grocery especially fruits and
diffusion process in modern retailing in terms of vegetables segment.
"waves" that go from country to country, and within

Adarsh Joumal of Management Research 53

 3.0. Research Methodology • To suggest better strategies in terms of value
3.1. Statement of the problem and need of the chain network in this micro segment.
study • To map the business model according to the
new age customers.
Food and grocery retail segment constitute more
than 60% of the overall retail industry. Many Modern 3.3. Methodology
retail formats in the above segment are providing The present study is conducted at Bangalore city,
different value proposition to cater to the needs of the capital of Karnataka. The reason being. Banga-
today's consumer. Still it was observed that many lore enjoys the distinction of being one of the fast-
of these consumers prefer to purchase their fruits est growing metropolises across the globe. Over
and vegetables from mobile vendors or nearby kirana the past decade, the garden city has recorded a
stores. Reasons for the above preferences can be growth rate of close to 30 per cent in its population.
due to the following: It ranks seventh amongst other Indian cities in terms
• Modern retailer's value delivery in this segment of 'affluent' population. More than one-third of the
is not matching the changing mindset of the households in Bangalore have an annual
today's global recession economy. expenditure between Rs 50,000 and Rs 1,00,000,
and a majority of residents fall in the age bracket of
• Value delivery is facing limitations in terms of
15-45 years, the ideal target market for a new
skills in back-end operations and other
generation retailer Bangalore has been a leader in
infrastructural bottlenecks.
supermarkets, which were made popular by the RPG
• Consumer's perception towards "value" in this Group's Food World outlets. Currently 17 in
Fruits and vegetable segment is distinct from number, the chain is still expanding into residential
other commodity and value purchases. pockets of the city. Food World was initially
• Business model or formats of western countries responsible for making the concept of grocery store
is not matching the Indian consumer's food chains popular in Bangalore. Several others that have
habits in the fruits and vegetables. followed suit include More and Monday 2 Sunday
Stores, Reliance fresh, Heritage group Fresh @
Modern formats of fruits and vegetables and their
location etc. Hypermarkets also started gaining
retail business model need to be realigned to cater
more prominence in Bangalore as consumers start
to the local needs of Indian consumers. For this
patronizing the stores for their one stop value
purpose, their value proposition should be revisited
shopping. Majority of these modern retail outlets
to match the value perception and expectation.
located in and around Jayanagar, southern part of
3.2. Objective of this study Bangalore. Jayanagar is well developed residential
The primary objective of this study is to find out the area with cosmopolitan setup. There are theaters,
emerging strategies of Modern retail formats in the shopping complexes, libraries and renowned
segment of food and grocery (especially fruits and educational institutions located here. Jayanagar
vegetables section) from the retailer perspective. shopping complex is the best place to shop at. This
The secondary objective of this study is as follows: place also has some of the famous eating joints of
• To identify the modern supermarkets and their Bangalore. Since Jayanagar is a major hub of
deliverables in Fruits and vegetable retailing. shopping in Bangalore, this study is conducted at
Jayanagar area.
• To analyze the suitable customized format for
this fruits and vegetables segment in India.

Vol 3 Issue 1 March 2010 54

3.3. Research Design online databases like CMIE etc. These secondary
data were analyzed qualitatively and the results were
Emerging marketing strategy was identified using
interpreted.
certain common parameters relevant to
supermarket. Value delivery was captured using the 4.0. Analysis of Data
three broad variables namely Store convenience, 4.1. Analysis Framework
choice and service; secondly, the value delivery of
Presence of IT Professional and influx of migrant
Modern retail formats was mapped using the
population made the Bangalore retail market as most
common variables like Retail business model and
attractive destination in the country. Last few years,
value chain network etc. To explore further on value
the retail expansion in the city was on an accelerated
proposition common variables like price, proximity,
pace with the entry of many organized corporate
merchandise mix, store atmosphere, customer
players in the form of supermarkets and
service and differentiation strategies were
hypermarkets. Since the late 2007 and 2008,
considered for study purpose. Supermarket format
Bangalore market has reached the saturation level
were selected for the study purpose.
where city is witnessing the trend of major retail
activity being relocated from Central business district
(Value
like M.CRoad, Commercial Street to peripheral
(Value Expectation
(Source) locations like north Bangalore along with
Delivery) & Perception) international airport route, Marrathalli ring road,
Jayanagar, J.P.Nagar, Malleswarem and Rajajinagar
Supplier • Retailer -• Consumer
etc. Jayanagar in south Bangalore is one of hot retail
Value Chain and Proposition place where many retail activities is happening to
cater to the large residential pockets of south
3.4. Data collection
Bangalore. To support their daily cores, many
3.4.1. Primary Data retailers set up their convenience stores and
supermarket format to cater to the need of food and
Primary and secondary data were used for the study.
non food FMCG products. But still majority of the
Primary data related to retailer's store atmosphere,
population are dependent on nearby vegetable mandi
merchandise mix, customer service are collected
and push cart vendors for their green vegetables and
by observation method.
fresh fruits. This study is an attempt to analyze the
3.4.2. Secondary Data value proposition of those organized supermarkets
in the category of fresh fruits and vegetables segment
Secondary data are collected from different sources
in jayanagar. For analyzing the value proposition,
regarding the retail business model, value chain
following variables are identified and selected;
network etc. Major variables considered for analyzing
the retail business model are Location, Merchandise • Proximity
mix (range, assortment and variety etc), price and • Price
service level. In value chain network, the • Merchandise quality and mix (Including
organization's sourcing strategy, transportation variety, depth, consistency etc)
• Store atmospherics
network, storage and replenishment and lead time
• Customer service
are considered. Secondary data collected from
• Innovation or differentiation strategies in their
sources like industry reports. Company websites,
offerings
corporate profiles, trade and business magazine and

Adarsh Journal of Management Research 55

4.2. Proximity proximity or location, price and merchandise
quality. Hence the value deliveries of these
Jayanagar is well developed residential area with
supermarkets were positioned accordingly. Due to
the cosmopolitan setup. To cater to the different
various administrative reasons, these organized
tastes and daily chores many organized
players were unable to add value in the area of
supermarkets are entered in to this business. The
proximity or location, but they are providing a value
partial lists of supermarkets formats in jayanagar
addition in terms of price substantially. It was
are as follows:
observed that all these supermarkets were provid-
Namdhari Fresh,
ing the value pricing in the area of fresh fruits and
More
vegetables. This is due to the effort on fairly strong
Fresh @ Jayanagar
value chain and supply end network. For example
Nilgiris
Namdhari Fresh based out of Bangalore operates
Foodworid
their own farm in the outskirts of Bangalore to pro-
Spencer's
vide fresh fruits and vegetables with better quality
DTH People Shoppe
with the cost effective pricing. Similarly, Reliance
Reliance Fresh
Fresh appointed various agents for sourcing their
Safal Daily Fresh
fruits and vegetables from nearby farms. Hence these
Subhiksha
supermarket business models are dominant with
Among the above supermarket formats, it was value pricing. But ultimately, overall pricing of
observed that majority of the supermarket does not modern supermarket is not comparable with
concentrate on a in-depth & full fledged green unorganized barring certain legal constraints.
vegetables and fruits section except few retailers
4.4. IVIerchandise quality and IVIix
like Namdhari fresh. Reliance fresh, Safal daily fresh
etc. hence, only above three supermarkets are Merchandise mix is central to the business model
considered for study purpose. It was observed that of any retail organization, these supermarkets have
majority of population is still dependent on nearby wide merchandise mix with various ranges in each
fruits and vegetables market or other unorganized category and sub categories. It was observed that
setup like push cart vendors for the purchase of fnjits Reliance Fresh Supermarket has more wide and
and green vegetables. Hence it is quite evident that deep merchandise mix catering to daily and specific
supermarkets who concentrate on fresh green needs of the customers. Merchandise quality also
vegetables and fruits need to be located very near observed to be more fresh and first grade quality
to the market. Therefore it is infen'ed that organized with the high value proposition. Namdhari Fresh
players with the business model of more green Supermarket also carries a medium merchandise
products need to establish high proximity to the width and depth as compared to an unorganized
market even though located in same locality. setup.

4.3. Price 4.5. Store Atmospherics

Bangalore is a cosmopolitan area with the diverse Store atmospherics is the physical characteristics
class of population across the different class of and surrounding influence of a retail store that is
social setup. It was a general trend in the city used to create an image in order to attract
population that consumer preferences towards these customers. This is an important element in
categories are ranked with the priority ranging from organized retail inducing the shopping mood and

Vol 3 Issue 1 March 2010 56

mindset, which is more minute in nature and highly selling bakery products with cakes and pastries.
sensitive area also. The components of store Vegetables and fruits product display and
atmospherics directly contributing to a store image, presentation are more attractive which reflects the
which ranging from exterior store atmosphere to freshness and quality of merchandise. All these
interior store atmosphere. supermarkets creates an shopping zone near to
Exterior store atmosphere - Components the freezer point where more innovative
Parking facility merchandise mix of vegetables and fruits are
Store front displayed, for instance value added packs of
Display window Reliance Fresh. Lighting arrangements are more
Place of business customized according to the merchandise section
Interior Store atmosphere - Components in terms of brightness and intensity. Many of the
Entrance dailies merchandise are strategically located in
Store layout and traffic pattern multiple shelves to avoid rushing in one shelf
Aisles location. Points of purchase are planned very well
Lighting which induce the impulse purchase on non-food
Product display items as well as daily chore items and chocolates
Shopping zone etc. Overall store atmosphere is more conducing
Strategic placement of products arising the mood of the shoppers with natural aroma.
On the summary, overall store atmospherics directly
Point of purchase
contributes to the store image.
Clean atmosphere

It was observed that the supermarket which was 4.6. Customer service and differentiation
taken for the study is maintaining a good strategies
atmosphere in both exterior and interior places. In Customer service of supermarket and daily
exterior store locations these supermarkets products essentially covers the basic necessary
allocated a adequate parking facility for services like availability of products, convenience,
two-wheeler's and public parking space opposite to strategic display of products, store assistance and
store for four-wheelers etc. Reliance fi'esh store name store timings etc. It was observed that supermarket
and logo communicates a good brand image and who are in to the green vegetables and fruits business
their business model of green vegetables and fruits could not make the products available at the shelf
and value retailing. Place of supermarket is more on a continuous phase , due to administrative
strategic and provide convenience to their custom- reasons like wastages and short shelf life period.
ers. Interior atmosphere of supermarket consists of Othenwise, these modern supermarkets were able
wide entrance which can allow more traffic in to the to provide superior customer service in terms of store
stores with the seasonal product display at the timings and other aspects.
entrance and other promotional offers displayed.
Innovation or differentiation strategies are executed
Store layout is grid type with the more planned
at different supermarket in different levels. It was
arrangement of selling space and walking space. In
observed that majority of the supermarket brought
some supermarkets, merchandise display arrange-
differentiation strategy only with respect to the
ments are complimentary in nature according to
merchandise mix or product display. But Reliance
their target customers food habits and tastes.
Fresh stores brought major breakthrough in the form
Majority of supermarkets plan their aisle space by

Adarsh Joumal of Management Research 57

of value added packs customized for the families One of the major challenges of these
where both husband and wife are employed. Value supermarkets is a lack of skill in well - oiled
added merchandise mix of Reliance Fresh are as system of replenishment or back-ward
follows: integration.
Providing value proposition in fruits and
Vegetables for sambar
vegetables segment by these modern
Vegetables for Fried rice supermarkets are the key to their business
Veg for Mexispicy CRN Salad model.
Veg for Pulav / Biryani Supermarket format essentially offer a
service in terms of fast replenishment in
Yam slice
daily staple goods and a bakery items on a
Pumkin slice
continuous day-to-day basis.
Caluliflower florets Indian shoppers are highly price sensitive
Cabbage shreds in food shopping, therefore a format with
wider choice and low prices will attract
Carrot shreds
shoppers in this region.
Fruit mix
Modern formats of fruits and vegetables and
Pineapple cleaned and wrapped their retail business model need to be
In addition to the merchandise mix, differentiation realigned to cater to the local needs of
or innovation brought with the support technology in Indian consumers.
terms of Point of Sale speedy billing process, Modern retail formats dealing with fresh
delivery methods, digital displays of price tags and fruits and vegetables are not closely located
other customer loyalty services etc. to their customers.
Modern supermarket dealing predominantly
5.0. Findings and suggestions of the Study with fresh fruits and vegetables are strong in
their local back end network, hence they
5.1. Findings of the Study
were in a position to offer better value pricing
• Indian retail sector began its next journey to their customers. But overall they are not
from the early 2009 as market started reviving matching with local grocers.
back. Reliance Fresh offers a wide and deep
• The recovery in consumer spending is visible range of fruits and vegetables
across almost all the industry sectors It was observed that modern supermarkets
especially in food and grocery. dealing primarily with green vegetables and
fruits are carrying good quality and fresh
• Consumers mindset has changed as
merchandise.
affected by the global recession and learned
It was observed that the supermarket which
the new wave of consumer spending with
was taken for the study is maintaining a good
more focus on value.
atmosphere in both exterior and interior
• It is mandatory for the retailers to revisit on places.
their value and marketing strategies to map Exterior display window and brand name &
the customer's new mindset and their logo were communicating the brand value.
spending habits.

Vol 3 Issue 1 March 2010 58

 • Retail location is more strategic and • Modern supermarkets need to source the
provides convenience to their customers. green products directly from the farmers by
• Store layout and store traffic is designed establishing backward business linkages.
according to their value in terms of • Contract farming and customized cultivation
merchandise classification. of products through mutations- can add more
• Point of purchase stimulating more impulse value to the customers.
purchase among customers. • Value chain initiatives need to be practiced
• Customer service with respect to the store right from farmer level to customer shelf, in
assistance and technology driven service order to support these values, modern outlets
delivery like billing process, packaging and can expand their business backward or
price tags makes the customer transaction outsource to professional bodies in the areas
efficient. of farming, aggregating, transporting, storing
• Some of the retailers practicing differentiation and replenishment activities.
strategy in overall business format in terms • Modern supermarket need to increase their
of merchandise and overall store experience proximity to their market on the basis of the
is encouraging. number of households.
• Modern supermarkets need to offer wider
5.2. Suggestions
range merchandise in the area of green
• Indian retail industry is more promising with vegetables and fruits except few players.
tremendous opportunity for organized retail,
• Store atmosphere and layout can be improved
hence Indian modern retail formats can
according to their business value or theme.
expand their business with planned scaled
• Unique mutation varieties can be introduced
activity with the support of appropriate
in both fruits and vegetables to provide superior
business linkages both forward as well as
value to the customers.
backward direction.
• The demand for supermarket and convenience 4.7. Business IVIodel and strategic frameworl(
stores are very high, supermarkets need to summary
capitalize on these opportunity with the strong After analyzing various factors which contributes to
back end supply network. the value delivery, a theoretical framework has been
• Many modern formats can concentrate more designed for supermarket which is termed as
on fresh fruits and vegetables as there are Supermarket business model. The models of the
plenty of business space available in the same are as follows:
market. This business model essentially starts from purpose
• Many supermarkets can enter into the deep of the business and further describes about
business model of green vegetables and fruits supermarkets strategy of establishing proximity with
to cater to their needs and lifestyle of the appropriate administrative network with source,
customers. buyers and logistics service providers. Value pricing
• Supermarkets can improve the quaiHy of can be exercised if a supermarket establish strong
merchandise in terms of freshness and fast supply chain network with appropriate business
replenishment of green vegetables and fruits. linkages, the same network can be scaled to bring

Adarsh Journal of Management Research 59

the better merchandise choice and align customer networl^. All these leads to better store image and
service with the appropriate customer service hence to business development.

Fig. 4.2. Value proposition IModel for supermarkets

Strategic Planning of Retail organization

(IMission, Vision and Purpose of Retial Business)

Proximity Area / City

Infrastructure
Customers
J, ,

Business
*"
Linlcages
• • '' '
Merchandise Customer
Mix Service
Political and Society both
Local taxes and business &
law Public

store
Atmospherics

Retail Image

V.

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Vol 3 Issue 1 Marcti 2010 60

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Adarsh Journal of Management Research 61