Big Bazaar
- 2. Plan of Presentation • Industry Analysis Industry size Key Players Key Drivers of change(PESTEL, Diamond Analysis) Opportunity and Threat • Organization Analysis Company details Stake Holder Analysis Value System Resource Analysis Competitive Strategy • Conclusion
- 3. Industry Size • India’s top retailers are largely lifestyle, clothing and apparel stores • This is followed by grocery stores • Following the past trends and business models in the west retail giants such as Pantaloon, Shoppers’ Stop and Lifestyle are likely to target metros and small cities almost doubling their current number of stores • These Walmart wannabes have the economy of scale to be low –medium cost retailers pocketing narrow margin
- 4. Key Players • Pantaloon Retail (India) Limited with over 12 million sq ft of retail space spread over 1,000 stores across 71 cities in India. • Tata Trent limited Retail sector activity: Apparel, books and music Current store formats: Hypermarket, supermarkets Future plans: New venture called • RPG Enterprises Stores: 250 stores, including 36 large format stores across 66 cities in India Retail sector activity: Music, food and grocery, beauty products • Landmark Group Apparel, home décor and furnishing, Current outlets: 15 Lifestyle stores and eight Home Centers • Madura garments 82 store in India across 50 cities and five international stores Retail sector activity: Apparel • Vishal Mega mart 180 showrooms in 100 cities, Retail area coverage of 2,990,146 sq ft • Bata 1,250 outlets in India • Provogue Ltd. Apparel and footwear, 124 own stores and 228 outlets in 64 cities • Archies Ltd. Archies has 100 company-owned stores in India and 450 franchise-run outlets
- 5. • POLOTICAL • ECONOMICAL • Government is stable • Government policy towards investment is liberal(49%) • Labor law • Restriction for MNC’s • Economy is growing(7.2%) • Recovery from recession • Monetary policy PEST ANALYSIS
- 6. • Socio-cultural • TECHNOLOGY • According to mckinsey report Indian consumer goods market is expected to reach $400 bl. By 2010 • Rapid expansion of IT sector • New trends are coming CONTD….
- 7. Key drivers of change • Multiple drivers leading to a consumption boom: • Favorable demographics • Growth in income • Increasing population of women • Raising aspirations : Value added goods sales • Food and apparel retailing key drivers of growth • Organized retailing in India has been largely an urban phenomenon with affluent classes and growing number of double-income households. • More successful in cities in the south and west of India. Reasons range from differences in consumer buying behavior to cost of real estate and taxation laws. • Rural markets emerging as a huge opportunity for retailers reflected in the share of the rural market across most categories of consumption • IT is a tool that has been used by retailers ranging from Amazon.com to eBay to radically change buying behavior across the globe.
- 8. Opportunities and threats OPPORTUNITIES • Retail industry in INDIA accounting 10% of the country’s GDP. • Successive Indian government have steadily Liberalize policies related to investment, banking, trading etc. • URBANISATION caused more concentration of middle income and high income people. • Hypermarket is emerging as the most favorable format for the time being in India • Increasing workforce of women • Falling real estate prices • Increase in disposable income and customer aspiration • Increase in expenditure for luxury items • Low share of organized retailing THREATS • Automatic approval is not allowed for foreign investment in retail. • Regulations restricting real estate purchases, and cumbersome local laws. • Taxation, which favours small retail businesses. • Absence of developed supply chain and integrated IT management. • Lack of trained work force. • Low skill level for retailing management. • Lack of Retailing Courses and study options • Intrinsic complexity of retailing – rapid price changes, constant threat of product obsolescence and low margins.
- 9. About Big Bazaar Hyper mart Chain of development store in India Out let 120 out lets Located in India Parent group Future group Owner Kishore Biyani (CEO) Founded 2001 Head quarter Jogeswari , Mumbai Industry Retail website www.bigbazar.com Tag line Is se sasta aur achha kahin nahi. Vision Everything ,Everywhere, Every time for every Indian consumer in the most profitable manner
- 10. Stakeholders & Big Bazaar Main Market/ Non Market stakeholders Market Stakeholders • The stockholders • The Big Bazaar Executive • The Employees • The Communities where Big Bazaars located • Consumers • Suppliers • Non profit Organization •Competitors Non Market Stakeholders • The Labor Unions • The International Retail Stores • The Politicians Big Bazaar Contributions Contributions Inducements Inducements
- 12. Value System – BIG BAZAAR
- 13. IN HOUSE BRANDS @ BIG BAZAAR DJ & C CLEAN MATE SENSEI KORYO STAR SITARA CARE MATE FRESH & PURE RENUKA MAJITHIA SARAPOLO and 40 more brands FEW BRANDS @ BIG BAZAAR
- 14. Porter’s five force model
- 15. Analysis 5 Forces Analysis Rivalry among the competitor •Reliance Retail, Aditya Birla Group , Vishal Retail’s, Bharti and Walmart, etc Threat of entrants •FDI policy not favorable for international players. • Economies of scale (minimum size requirements for profitable operations) •High initial investments and fixed costs •Cost advantages of existing players due to experience curve effects of operation with fully depreciated assets •Scarcity of important resources, e.g. qualified expert staff Bargaining power of supplier •The bargaining power of suppliers varies depending upon the target segment. •The unorganised sector has a dominant position. • There are few players who have a slight edge over others on account of being established players and enjoying brand distinction. Bargaining power of buyers • Consumers are price sensitive.. •Availability of more choice. Threat of substitutes •Unorganized retail
- 16. Resource Analysis • Human Resource Well Trained Staff Appearance Empowered Individual Encouraged To Think Out Of The Box Employ close to 10,000 people and recruit nearly 500 additional people every month Use Scenario Planning as a tool for Quick Decision Making Security Gaurds At All Gates
- 17. Financial data
- 18. CORE COMPETENCY OF BIG BAZAR • A choice of more than 20000 products • Delivery across more than 1500 cities covering around 16000 pin codes • A dedicated customer care helpline for any queries • Fast delivery-tie up with world leader logistic & transportation services • Talks of Quality and Cost • Special emphasis on apparels and life style products • Providing interesting discounts Core-Competency of Big Bazaar
- 19. Strength - High Brand Equity - State-of-art infrastructure - EDLP - PoP promotions - Variety of stuff under single roof -MIS Weakness - Unable to meet store opening targets - Falling revenue/sq. ft. - General perception Opportunity • Organized retail (4.15%) • Evolving consumer preferences • In Store Experience Improvements • New formats and consumption space • Looking at expansion Threat - Competitors - Government policies - Unorganized retail -Economic condition
- 20. Customer Segmentation Big Bazaar targets higher and upper middle class customers. The large and growing young working population is a preferred customer segment. Big Bazaar specifically targets working women and home makers who are the primary decision makers.
- 21. M A R K E T G R O W T H Market Share High L O W H I G H Low Big Bazaar At BCG Matrix M A R K E T G R O W T H H I G H L O W M A R K E T G R O W T H H I G H Low L O W M A R K E T G R O W T H H I G H High Low L O W M A R K E T G R O W T H H I G H Market Share High Low L O W M A R K E T G R O W T H H I G H High Market Share High Low Market Share High M A R K E T G R O W T H Low Market Share High L O W M A R K E T G R O W T H Low Market Share High H I G H L O W M A R K E T G R O W T H Low Market Share High Market Share High Low Market Share High M A R K E T G R O W T H Low Market Share High L O W M A R K E T G R O W T H LowHigh H I G H L O W M A R K E T G R O W T H LowHigh H I G H L O W M A R K E T G R O W T H LowHigh
- 22. Organization value and customer value *High organization value *Low customer value Big Bazaar *High organization value *High customer value *Low organization value *Low customer value *Low organization value *Low customer value
- 23. Strategy Focus on Rural customer? • 73% of population live in 6,00000 villages out of Total population 114 billion. • Minimum support price. • NREGS -100 days employment. • Income from farm products is Tax free. Customer oriented Employee oriented- high attrition rate
- 24. Thank You
- 25. References • www.bigbazaar.com • It Happened in India- Kishore Biyani • www.ibef.org • www.google.co.in • www.economictimes.com • futurebazaar.com