MBA II Retail Management Unit II Notes
MBA II Retail Management Unit II Notes
a) Layout Design
• Grid Layout: Straight aisles; used in supermarkets for efficient product exposure.
• Racetrack (Loop) Layout: Encourages circular movement; common in department
stores.
• Free-Flow Layout: Asymmetrical; used in boutiques to create a relaxed atmosphere.
• Herringbone Layout: Used in narrow spaces; products arranged diagonally to guide
flow.
b) Space Management
3. Visual Merchandising
4. Lighting
5. Color Scheme
• Includes seating areas, fitting rooms, air conditioning, and clean facilities.
• Design should ensure ADA (Accessibility) compliance.
• A customer-friendly space encourages longer visits and higher sales.
Store Design: Exteriors
1. Importance of Exterior Design
a) Storefront (Façade)
• The face of the store, includes walls, entryways, signage, and windows.
• Should reflect the store’s personality—modern, traditional, luxury, etc.
• Needs to be clean, inviting, and well-maintained.
b) Signage
3. Entrance Design
4. Exterior Lighting
6. Landscaping
• Greenery, flowers, and clean surroundings enhance the store’s aesthetic appeal.
• Should be well-maintained to give a pleasant and professional look.
• Materials like glass, metal, wood, or stone help define the architectural style.
• Color schemes should match the brand identity and stand out without clashing with
surroundings.
• Some stores use outdoor racks, tables, or banners to showcase deals and clearance
items.
• Should not obstruct the entrance or foot traffic.
9. Security Features
• Exterior should be consistent with the brand’s image and target market.
• Themed exteriors (e.g., rustic for organic stores, sleek glass for tech stores) reinforce
the store's concept.
• Store layout refers to the design and arrangement of physical space within a retail
store.
• It involves the positioning of merchandise, fixtures, aisles, checkouts, and other
service areas to maximize efficiency and enhance customer experience.
• A well-planned layout guides customer movement, improves product visibility, and
promotes sales.
a) Grid Layout
c) Free-Flow Layout
d) Herringbone Layout
e) Spine Layout
• Central spine or main aisle with branches leading to product areas.
• Combines benefits of grid and free-flow layouts.
• Effective for medium-sized stores and showrooms.
1. Grid Layout
• Advantages:
• Disadvantages:
• Advantages:
• Disadvantages:
3. Free-Flow Layout
• Advantages:
o Creates a relaxed and upscale environment.
• Disadvantages:
o Less space-efficient.
4. Spine Layout
• Structure: A main central aisle (the spine) with smaller aisles branching off.
• Advantages:
• Disadvantages:
5. Herringbone Layout
• Structure: A variation of the grid layout, with angled aisles branching off a central
aisle.
• Advantages:
• Disadvantages:
• Structure: Store is divided into small, individual areas or “mini-stores” for brands or
categories.
• Disadvantages:
7. Mixed Layout
• Advantages:
• Disadvantages:
Flexibility and
Mixed Big-box, versatile retailers Hybrid layout
customization
Factors Affecting Store Layout
A well-designed store layout depends on various factors that influence how space is used,
how products are presented, and how customers interact within the store environment. These
factors ensure the layout aligns with business goals, customer expectations, and
operational efficiency.
• Product type (e.g., perishable, high-value, convenience items) affects layout choice.
• Bulky items need more open space (e.g., furniture).
• Small, high-value items may need secure, visible displays (e.g., jewelry).
• Fashion and seasonal items often benefit from flexible layouts for frequent changes.
3. Target Customers
• The demographic profile (age, gender, income, shopping behavior) shapes layout:
o Young shoppers may prefer dynamic, interactive zones.
o Older customers may require wider aisles and clearer signage.
• Customer traffic patterns also influence where key products are placed.
5. Store Location
• Urban vs. suburban stores differ in space availability and customer behavior.
• Mall-based stores often emphasize window displays and front-of-store appeal.
• Standalone stores may need more parking integration and external signage.
6. Brand Image and Store Atmosphere
• The need for backroom space, stock rotation, and replenishment efficiency affects
how space is divided.
• High-turnover products need easy restocking and visibility.
• Security concerns may dictate placement of expensive or frequently stolen items.
8. Technology Integration
• Use of self-checkout systems, interactive screens, and mobile POS impacts layout.
• Stores integrating digital displays or AR experiences need open, tech-enabled zones.
• Layout should:
o Guide customers smoothly from entry to checkout.
o Encourage them to explore more sections.
o Reduce bottlenecks and wait times in high-traffic areas.
The store image mix refers to the combination of elements that collectively form the overall
perception or mental picture that customers have of a retail store.
It’s how a customer sees, feels, and experiences the store — based on visual appeal, service,
layout, product offerings, and more.
1. Store Atmosphere
3. Merchandise Assortment
4. Pricing Strategy
5. Visual Merchandising
• Presentation of products through displays, mannequins, shelving.
• Grabs attention and highlights featured or new items.
6. Customer Service
9. Technology Integration
1. Storefront Design
o The architectural styling and theme of the front.
o Must align with the brand image (e.g., luxury, modern, rustic).
2. Store Name and Signage
o Clear, visible, and on-brand.
o Often illuminated for nighttime visibility.
3. Display Windows
o Used for visual merchandising.
o Shows featured products, offers, or seasonal themes.
4. Entrance Design
o Should be inviting, accessible, and aligned with the store layout.
o Includes doors, handles, mats, and entry signage.
5. Lighting
o Highlights signage and display windows.
o Enhances safety, ambiance, and night-time visibility.
6. Color and Materials
o Choice of colors and building materials reflects the brand’s character.
o Examples: glass (modern), wood (natural), steel (industrial).
7. Landscaping and Exterior Décor
o Adds to the visual appeal.
o Includes plants, benches, pavement design, etc.
Best Practices:
An Internet store, also called an online store or e-retail store, is a virtual platform that
allows businesses to sell products or services over the internet. It operates through a
website or mobile app, enabling customers to browse, select, and purchase items online.
1. Wide Reach
o Sell to customers across cities, countries, or globally.
2. Lower Operating Costs
o No need for physical space, utilities, or large staff.
3. Convenience for Customers
o Easy to shop, compare, and make decisions from home.
4. Data Collection & Personalization
o Track customer behavior and recommend products accordingly.
5. Scalability
o Easy to expand product range without major infrastructure changes.
• Shopify
• WooCommerce (WordPress)
• Magento
• BigCommerce
• Amazon, Flipkart, Etsy (for marketplace selling)
Brand Category
Amazon Multi-category
Myntra Fashion
Nykaa Beauty & Wellness
Flipkart Electronics & More
Pepperfry Furniture
Floor Space Management refers to the strategic planning, allocation, and utilization of the
physical space within a retail store to maximize sales, customer experience, and
operational efficiency.
Key Objectives:
1. Selling Area
o Main floor where products are displayed and sold.
o Includes aisles, display racks, end caps, and promotional zones.
2. Merchandising Area
o Specific zones for categories (e.g., clothing, electronics).
o Allocated based on sales potential or consumer behavior.
3. Customer Service Area
o Checkout counters, help desks, fitting rooms, waiting lounges.
4. Storage/Backroom Area
o Stockroom, employee zones, office space.
1. Planogramming
o Visual diagrams showing product placement on shelves.
o Ensures consistency and strategic display.
2. ABC Analysis
o Classify items based on sales volume:
A = High sales, B = Moderate, C = Low.
o Allocate space accordingly.
3. Space-to-Sales Ratio
o Measures how much space a product uses vs. how much revenue it generates.
4. Customer Flow Mapping
o Study how customers move through the store and adjust layouts to guide them
effectively.
Best Practices:
Examples:
• A supermarket may place impulse items (gum, chocolates) near the checkout
counters.
• A clothing store may dedicate prime wall space to new arrivals or bestsellers.
• Electronics stores often have demo zones in high-visibility areas.
1. ABC Analysis
o Categorizes inventory based on value and importance:
▪ A: High value, low quantity
▪ B: Moderate value
▪ C: Low value, high quantity
2. Economic Order Quantity (EOQ)
o Calculates the optimal order quantity to minimize total inventory cost.
3. Just-in-Time (JIT)
o Stock is replenished only when needed, reducing storage costs.
4. FIFO and LIFO
o FIFO (First In, First Out): Oldest stock sold first (common in perishable
goods).
o LIFO (Last In, First Out): Latest stock sold first (less common in retail).
5. Reorder Point System
o Predetermined level at which new stock is ordered to avoid running out.
6. Cycle Counting
o Ongoing, regular inventory checks instead of full stock-taking at once.
Technology in Inventory Management:
• Point-of-Sale (POS) Systems – Track sales and update stock in real time.
• Barcode/RFID Scanning – Helps with fast and accurate stock-taking.
• Inventory Management Software – Automates stock tracking, reordering,
forecasting, etc.
• Cloud-based Platforms – Enable centralized inventory control for multi-store chains.
Best Practices:
Product display refers to the presentation and arrangement of merchandise within a retail
store to attract attention, encourage browsing, and stimulate purchases.
Objectives of Product Display:
1. Visual Merchandising
o Use of color, lighting, props, and themes to create eye-catching arrangements.
2. Merchandise Grouping
o Group products by category, color, size, brand, or usage.
3. Simplicity
o Avoid clutter. Make displays easy to understand and navigate.
4. Signage
o Use clear signs to indicate prices, offers, or product information.
5. Lighting
o Proper lighting highlights key products and adds drama to displays.
6. Customer Psychology
o Place high-demand or promotional items at eye level or right-hand side
(natural movement pattern).
7. Rotation
o Frequently change displays to maintain freshness and interest.
Examples:
• Zara uses minimalist displays with clean lines and coordinated outfits.
• Apple Stores use spacious table displays with working demo products.
• Supermarkets use end caps and eye-level shelving to push high-margin items.