FRM case no 10

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Franchise & Retail Management Case NO 10

Nishit Doshi2801132 Page 1

Written Case Format

Name (Of the faculty) : Prof: Sandeep Prabhu.

Signature:

Date of Evaluation:

Remarks (By Faculty): _________________________________________

_________________________________________

_________________________________________

________________________________________

Name: Nishit Doshi

Due Date/Day:12-02-2012

Class: Marketing-2nd

year

Roll No:2801132

Subject: FRM

Case No: 10

Topic: Big Bazaar the route to the Indian mass market.

Signature:

Marks out of 10

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BIGBAZAAR- THE ROUTE TO THE INDIAN MASS MARKET

Company Profile: (Big Bazaar)

Type Public

Industry Retailing

Founded 2001

Headquarters Mumbai, India

Product Department store

Employees More than 40000 people

Parent Future Group

Introduction:

y Big Bazaar was introduced by Pantaloons Retail in India in 2001.

y First store was opened in Kolkata.

y With in 22 days other stores were opened in Hyderabad & Banglore.

y In 2006 & 2007, 27 new stores were launched in 22 cities.

y By May 2008 , 89 Big Bazaars spread across country.

Background of Pantaloons:

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y In 1987 , was incorporated as Manz Wear Private Limited.

y In 1991 became public limited & was renamed as Pantaloon Retail India

LTD.

y In 1993 launched three successful brands- Bare denims, Pantaloon trousers

& John Miller.

y In 1998 company introduced the concept of the pantaloon shopee an

exclusive mens wear retail store.

y In 1997, Company moved to a large format lifestyle retailing by opening

family store.

Strategy undertaken by Big Bazaar:

y To offer value to the customers.

y Price was the basic value proposition at Big Bazaar.

y Price of the product were 5 to 6 lower then the market price.

y As the store offered large mix of product at the discounted price the name

was Big Bazaar.

Selecting the right location:

y They opened stored with in the city.

y They took land on lease for 12 to 20 years.

y The rentals varied from RS. 30 per sq feet to RS 50 per sq feet.

The Merchandise mix:

y It stocked about 1,30,000 items in over 20 product categories.

y The classification was done in terms of apparel & non apparel.

y In the first year apparel accounted for 70% of the off take.

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y The price ranged form RS 99 to RS 799.

y Launched food Bazaar in the first year of operation.

y Non apparel include plastic items , footware, toys, luggage & stationary.

Pricing strategy ofBig Bazaar:

y Value pricing & maintenance of good quality were the key factors

influencing the pricing decision.

y Price that will offer value to customers will be first determined.

Food Bazaar:

y Launched in 2002 & was modeled in Indian Mandi.

y Processed food & Non food ( contributed 60%).

y Dry staples (contributed 30%)

y Wet staples (contributed 10%)

Company launched:

y Food Bazaar Masalas

y Food Bazaar Tea.

y Premium Harvest Pulses.

Apparels sales share at Big Bazaar is 40% where as food share is 26%.

Supply Chain Management ofBig Bazaar:

y Distribution is decentralized.

y Warehouse attached to each store.

y Initially stock turn over was three months which is now down to 2 months.

Organization structure at Big Bazaar:

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y Divisions are apparel, non apparel and new business divisions include gold,

footwear and the shop in shops.

y 1800 people work forBig Bazaar directly.

y Another 400 people for support & ancillary.

y Training program of new employees.

y Evaluation is done every 6 months.

Loyalty programmes:

y Launched Big Bazaar ICICI bank co branded credit dard.

y

Free home delivery to card holders.y On purchase of RS 1500 or more customer has the option of making

payment by three EMI with out any charges.

y For every 100 spent on shopping 4 reward points are rewarded.

Conclusion:

Big Bazaar did a lot of market research before entering in to the market. A lot of

research was done in selecting a location and customer perception and much more

diversification was done. To retain the customers lots of loyalty program & IT

techniques were used.

Documents

FRM case no 10