Summer Projec-Neerjal

Neeraja Sasidharan, AABMI Navsari Agriculture University, Gujarat. (2013-15) Page 1
A Summer Training Project
On
“Study Of Changing Customer’s Perception Towards
Modern Retail Stores And Analysis Of Supply Chain
Losses At Reliance Fresh”
In Partial Fulfilment of the Degree of Master of Business
Administration (Agribusiness) 2012-2013
Under the guidance of
Mr. Prodhyut Pal
(Senior Manager, F & V)
Reliance Retail Ltd.
Submitted by
Neeraja Sasidharan
(2070513015)

ASPEE Agribusiness Management Institute
Navsari Agricultural University
Navsari
ASPEE AGRIBUSINESS MANAGEMENT INSTITUTE
Navsari Agricultural University,
Navsari
Declaration by Student
I hereby declare that the project entitled “Study Of Changing Customer’s
Perception Towards Modern Retail Stores And Analysis Of Supply Chain Losses
At Reliance Fresh” submitted for the M.B.A. (Agribusiness) Degree is my
original work and the dissertation has not formed the basis for the award of
any degree, associate ship, fellowship or any other similar titles.
Place: AABMI, Navsari Neeraja Sasidharan

Date: Reg. No. 2070513015
ASPEE AGRIBUSINESS MANAGEMENT INSTITUTE
Navsari Agricultural University,
Navsari
Certificate
This is to certify that the project entitled “Study of Changing Customer’s Perception towards
Modern Retail Stores And Analysis of Supply Chain Losses At Reliance Fresh” is the bonafide
research work carried out by Neeraja Sasidharan. (2070513015) student of M.B.A. (Agribusiness) during the year 2012 -
2014, in partial fulfilment of requirement for the award of the Degree of Master of Business Administration (Agri. business)
under my guidance and supervision and that the project has not formed the basis for the award previously of any
degree, diploma, associate ship, fellowship or any other similar title.
Place: Navsari Dr. Ruchira Shukla.
Date: (Associate Professor)

ACKNOWLEDGEMENT
Every project big or small is successful largely due to the effort of a number of wonderful people
who have always given their valuable advice or lent a helping hand. I sincerely appreciate the
inspiration; support and guidance of all those people who have been instrumental in making this
project a success.
I am extremely grateful to “Reliance Retail Limited” for the confidence bestowed in me and
entrusting the project. I wish to express my gratitude to entire management for giving me an
opportunity to be a part of their esteemed organization and enhancing my knowledge by granting
permission to do our Management Internship project in the Company.
At this juncture I feel deeply honoured in expressing my sincere thanks to Mr. Prodhyut Pal
sir, for making the resources available at right time and providing valuable insights leading to the
successful completion of my project. I am grateful to Mr. Dharmendra Jaiswara sir (Unit
Manager), Mr.Mehta sir, Mr Rakesh Tandel sir and others at Naroda city processing centre, for
their invaluable guidance and cooperation during the course of the project. They provided me with
the guidance and support whenever needed that has been instrumental in completion of this project.
I would like to express my heartiest gratefulness to my faculty guide, Dr. Ruchira Shukla, AABMI Navsari, for giving her full effort in
guiding me in achieving the goal as well as her encouragement to maintain my progress in track.
I also extend my gratitude to placement coordinator, Dr. Mehul G. Thakkar who helped in
coordinating the project. I would also like to thank all the faculty members of ASPEE Agribusiness
Management Institute for their critical advice and guidance without which this project would not
have been possible.
Last but not the least I place a deep sense of gratitude to my Parents and my friends who have been
constant source of inspiration during the preparation of this project work.
Neeraja Sasidharan
Reg. No. 2070513015
CONTENTS

Sr. No. Particulars Page No.
Executive Summary 1
Chapter 1. Industry Profile 4
Chapter 2. Company Profile 15
Chapter 3. Project 26
3.1& 3.2 Title and Objective 26
Chapter 4. Research Methodology 29
4.1 Research Design 29
4.2 Nature and sources of data 30
4.3 Research instrument 30
4.4 Sampling design 31
Chapter 5. Data Analysis and Interpretation 33
Chapter 6. Findings 61
Chapter 7. Managerial Implication 64
Chapter 8. Conclusion 67
Annexure 69
Questionnaire for Farmer 69
Bibliography 72

List of Tables
1.1 Relative shares of organized and traditional retail in Indian retail market 6
1.2 Segment wise analysis of Total. Organised and Traditional Retail Market in India 10
1.3 Organised Retail Formats in India with Its Description and Key Players 11
4.1 Profile of Reliance stores in Gujarat 29
5.1 Age group of target customers 33
5.2 Gender wise distribution of target customers 34
5.3 Marital status of target customers 35
5.4 Education qualification of target customers 36
5.5 Occupation of target customers 37
5.6 Annual income of target customers 37
5.7 No of family members of target customers 38
5.8 Place Preference to buy F & V 39
5.9 Store Preference to buy F & V 40
5.10 Frequency of buying fruits and vegetables from retail stores 40
5.11 Days Preferred to buy F & V 41
5.12 Buying Pattern of F & V by Target Customers 42
5.13 Factors influencing the consumers to buy fruits and vegetables from organized retailers 43
5.14 Visit to Reliance Mart 44
5.15 Comparison of Star Bazaar and Reliance Mart 44
5.16 Satisfaction Level of target customer at Reliance Stores 45
5.17 Performance evaluation of different retail stores based on Different parameter 46
5.18 Top Ten SKUs causing Loss 52
5.19 Dump value of FFV in May month 53
5.20 Shrinkage Value in FFV in month of May 2014 54
5.21 S & G report of top five SKUs on 08.07.2014 55
List of Figures

1.1 Key Growth Drivers for Organized Retailing 7
2.1 Value chain Model of Reliance Fresh 23
5.1 Age group of target customers 33
5.2 Gender wise distribution of target customers 34
5.3 Marital status of target customers 35
5.4 Education qualification of target customers 36
5.5 Occupation of target customers 37
5.6 Annual income of target customers 38
5.7 No of family members of target customers 38
5.8 Place Preference to buy F & V 39
5.9 Store Preference to buy F & V 40
5.10 Frequency of buying fruits and vegetables from retail stores 40
5.11 Days Preferred to buy F & V 41
5.12 Buying Pattern of F & V by Target Customers 42
5.13 Factors influencing the consumers to buy fruits and vegetables from organized
retailers
43
5.14 Satisfaction Level of target customer at Reliance Stores 45
5.15 Performance evaluation of different retail stores based on Different parameter 46
5.16 Supply Chain Operations of Reliance F & V 48
5.17 Flow chart showing detailed SC of Reliance 51

EXECUTIVE SUMMARY
Retailing is one of the largest sectors in the global economy and is going through an evolutionary
stage in India. Retail is currently a flourishing sector of the Indian economy. The total concept and
idea of shopping has undergone an attention drawing change in terms of format and consumer buying
behaviour, ushering a revolution in shopping in India. The growth pattern in organized retailing and
in the consumption made by the Indian population will follow a rising graph helping the newer
businessmen to enter the India Retail Industry.
With a vision to generate inclusive growth and prosperity for farmers, vendor partners, small
shopkeepers and consumers, Reliance Retail Limited (RRL), a subsidiary of RIL, was set up to lead
Reliance Group’s foray into organized retail. Since its inception in 2006, Reliance Retail Limited
(RRL) has grown into an organisation that caters to millions of customers, thousands of farmers and
vendors. Based on its core growth strategy of backward integration, RRL has made rapid progress
towards building an entire value chain starting from the farmers to the end consumer.
The present project titled ‘Study Of Changing Customer’s Perception Towards Modern Retail
Stores And Analysis Of Supply Chain Loss At Reliance Fresh’ mainly aims to identify the factors
influencing the perception towards modern organized retailing from unorganized retailers. The
project work was carried under the guidance of Mr. Prodhyut Pal, senior manager of Fruits and
Vegetables and faculty guide Dr. Ruchira shukla Associate Professor, AABMI, Navsari. The
study focussed on following objectives:
1) To study the factors influencing the consumers to buy fruits and vegetables from organized
retailers
2) To carry out a comparative analysis of the customer perceptions of stores of Star Bazaar and
Reliance Fresh
3) To analyse the fruits and vegetable supply chain losses at Naroda CPC
4) To draw managerial implication and suggestion for Reliance stores
The project was done in two phases: Phase 1: For the purpose of the study of front end operation,
descriptive research design was used. Convenience sampling method is adopted for the study.
Mall intercept survey method was used for collecting the data. The data was collected from four
stores, out of which two of the Reliance and one store each of Star Bazaar and Big Bazaar stores
were surveyed. A well structured questionnaire was designed for the study and due care was taken to
avoid any kind of ambiguity. The sample for the study was taken as 100 respondents.

Phase 2: For the purpose of understanding supply chain management and analysing the why losses
occur, observation method was used and interaction between manager and staffs was done at
Naroda CPC.
Major Findings:
Customer’s Buying Behaviour towards Fruits and Vegetables
1. Majority of customers considered freshness and quality as prime factor that influenced them to
buy fruits and vegetables from these stores.
2. Overall majority of consumers preferred Reliance Fresh. However, in comparative analysis,
majority of customers preferred Star Bazaar as it provided fresh as well good quality of fresh
fruits and vegetables. Price was the important parameter in which Reliance Iskon fared well.
3. Most of customers were highly satisfied with employee behaviour and brand image of the
Reliance stores. Customers were satisfied by price, cleanliness & hygiene of retail stores. Most of
customers were unhappy with the product assortment, quality and freshness.
4. In case of Performance evaluation of different retail stores, Star Bazaar’s performance stands out
compared to its competitors followed by Reliance and Big Bazaar. Reliance ranks better in case of
price.
Supply chain loss at Naroda CPC and Stores
1.Total loss at Naroda CPC is estimated to be about 2.68% of total arrivals. (source: Internal
records of Naroda CPC)
2.Top Ten SKUs causing loss were reported as Onion, Potato, Tomato ,Capsicum, Bottle gourd,
Okra, Cucumber, Pointed gourd, Cauliflower, Mango Kesar. The amount was reported to be
231671.5 lakhs and quantity lost was 9936.39 kg in month of May.
3.The serious types of losses identified at the back-end are: Dump loss, shrinkage loss and transit
loss
4.The maximum dump loss occurred in Coriander followed by tomato. The total quantity of
shrinkage loss is 4369.946 kg and total amount is 81515.5 lakhs.
5.The major causes of transit loss identified are long waiting for loading and unloading, city‘s harsh
climatic conditions during summer, lack of properly ventilated reefer vehicles and improper
arrangement of crates in trucks.
6.Major causes of losses identified at Naroda City processing centre are:
 During grading and sorting, Mixing of non-Reliance retail (NRR) and Reliance retail quantities
(RR) and dumping into NRR by workers.
 Improper functioning of cold storage, Mis-matching and allocation errors of the produce at CPC
 Indent informed by store doesn’t match the CPC supply, Untimely accounting of material and
High inventory holding
7. The major reason for losses at stores identified are lack of timely sorting of fruits and vegetables,
damage caused by customers while picking, improper indenting. Products, which aren’t sold in
morning, are mixed with new arrivals in afternoon and are marked down, exposing Fruits and
vegetables in large piles and bad display.
Thus, Reliance needs to develop its core competencies so as to stay stronger in Market

1. INDUSTRY PROFILE
1.1 INTRODUCTION
Retailing is one of the fastest growing segments of the economy. The word “Retail” has originated
from a French word, “retaillier” and means “to cut a piece off” or “to break a bulk”. Retailing
means, ‘Re-tailing’ to the customers so that they come back towards them. According to Kotler,
“Retailing includes all the activities involved in selling goods or services to the final consumers
for personnel, non- business use”. Retailing is beneficial to both consumers and sellers. On the one
hand, it enables the consumers to purchase small quantities of an assortment of products at a
reasonably affordable price; on the other, it offers an opportunity to suppliers to reach their target
market. Through retail promotions, they can build product demand and provide consumer feedback
to the product marketer. Thus retail consists of sale of goods and services from individuals or
businesses to the end-user. A retailer earns profit by purchasing large quantities of goods and
services either from manufacturers directly or through a wholesale and he is a part of an integrated
system called the supply chain. Retail has emerged as one of the most dynamic and fast paced
industries with new players entering the market every day.
The size of Indian retail market in 2010 was estimated at US$ 353 billion and by 2014; it is
expected to increase up to US$ 543 billion. Further, by 2020, its value is pegged to be at 1.3 trillion
USD. Over 20 per cent of India's gross domestic product (GDP) is contributed by retail sector and in
total employment, it contributes eight percent. India is home to one of the top five retail markets in
the world and offers immense scope of growth and opportunities.
According to Global Retail Development Index 2012, Retail industry in India used to be the fifth
largest in the world, and is one of the sunrise sectors with huge growth potential and accounted for
14-15% of the country’s GDP. Today, high consumer price inflation, government debts, currency
fluctuation, high current account deficient and strict foreign direct investment policies, has impeded
its growth. India drops to six spots to 20th
place, its lowest ranking in GRDI (Source: A.T. Kearney
2014, Global Retail Development Index).
The global slowdown has impacted India’s growth and as a result, growth rate has fallen from a 10-
year average of 7.8 percent to 5 percent. India’s previous low ranking was 6th place in the inaugural
Index in 2002 but in 2009, it stood first. However the GRDI report points out some positive factors
leading to optimistic expectations. These factors are: strong long-term fundamentals and young,
increasingly brand and fashion-conscious population.

According to the Yes Bank-Assocham study, organised retail, which comprised a meagre seven
per cent of overall retail market in 2011-12, is estimated to grow at a CAGR of 24 per cent and
attain 10.2 per cent share of total retail by 2016-17. Optimism about high potential of growth in
organized retail in India indicate that in past, a large part of India’s consumption needs was
accounted by food but now transition is taking place from traditional retail to organised retailing due
to changing consumer expectations, demographic mix, etc. The new generation appreciates mall
culture which makes it convenient to shop with multiplicity of choice under one roof (Shop- in
Shop). Over the long run, these are expected to be the growth drivers of organised retailing in India.
Further, FICCI states that despite the downturns, the organized retail market in India is growing
exponentially due to growing consuming classes resulting from economic growth and organized
retail is attracting more and more existing shoppers into its open doors. The Government’s initiative
to allow 51 per cent foreign direct investment (FDI) in multi-brand retail has been a subject for
debate for quite some time now. Indian retail sector has therefore attracted the attention of people
from various fields including academia, industry, research organisations etc.
1.2 RETAIL INDUSTRY IN INDIA
1.2.1 Landscape of Retail in India:
The Indian government does not recognize retail as an industry. Retailing in India is highly
unorganized, fragmented, and predominately owner manned shops due to poor access to credit,
technology and regulation. The Indian retail market is dominated by small kirana stores (mom and
pop stores) and government run food distribution outlets supplying essential commodities. In 2010,
larger format convenience stores and supermarkets accounted for about 4 percent of the industry, and
these were present only in large urban centers. With India’s growing per capita income and a rising
middle class, the retail sector has the potential to be the real growth engine of the country’s economy.
While demand for a superior shopping experience is evident in the metropolitan cities, the Tier II and
Tier III towns are also rapidly acclimatising to the changing landscape of the Indian retail market.
Growing consumerism, changes in consumers’ tastes and preferences, and heightened brand
consciousness has been fast replacing traditional mom and pop stores with organised retail malls that
house lifestyle and luxury brands from national and international retailers.
Over the past decade, such cities as NCR-Delhi, Mumbai and Bangalore have shown prominent
growth in retail stock, while Hyderabad, Pune, Chennai, Kolkata and many other Tier III towns are
rapidly emerging as the retail growth corridors of the next decade. But profitability continues to be

an issue for many retailers as high estate costs, high capital borrowing costs, shrinkage, high debt
levels, training of qualified staff and a costly supply chain add significantly to operating cost.
1.2.2 Structure of Retail Industry
The total retail sector in India can be divided mainly into organized and unorganised sectors. The
trading activities undertaken by licensed retailers are categorized as organized retailing. Licensed
retailers are those who are registered for sales tax, income tax, etc. These include the corporate-
backed hypermarkets and retail chains, and the privately owned large retail businesses.
By unorganized retail trade enterprises, we mean all those local kirana & general shops, family
managed –Own Account trade enterprises (Mom-Pop shops), registered under the Shops and
Establishment Act (s), administered by the local authorities. Their number is very large and this
category of enterprises dominate Indian scenario. At this juncture, they apparently, are providing
tough competition to large retail outlets.
There is also a third category of retailers referred as informal sector which include small shops
such as tiny grocery and vegetable shops run from a room of a house, paan/beedi kiosks (often
selling a variety of items, like small toothpaste tubes, tooth brushes, soaps, pouches of shampoo, etc),
way-side vendors, and hand carts operating without any licences. This is not any past-time activity
for owners, but is an economic necessity.
The percentage share of unorganized retail in India is about 92% and organized retail is only 4%.It is
expected to gain a higher share in the growing pie of the retail market in India. Various estimates put
the share of organized retail as 20% by 2020.
Table 1.1 presents the figures for relative shares of organized and traditional retail in Indian
retail market
Year Organized Unorganized
2010 5.0 95.0
2012 8.0 92.0
2015E
21.0 79.0
2020E
24.0 76.0
E- Expected

Source: Singh, Kalpana (2014); “Retail Sector in India: Present Scenario, Emerging Opportunities
and Challenges”, IOSR Journal of Business and Management (IOSR-JBM) Volume 16 (4). PP 72-81.
1.2.3 Growth Drivers of Retail Sector
The Indian retailing sector is at an inflexion point where the growth of organized retailing and
consumption by the Indian population is going to take a higher growth trajectory.
Fig: 1.1 Key Growth Drivers for Organized Retailing
Source: Retail Landscape in India, an Analysis. Dr. A. Jayakumar, K. Geetha International Journal in
Multidisciplinary and Academic Research (SSIJMAR) Vol. 1, No. 3, September-October.
1.2.4 Segments Contributing Organized Retail
The total retail market in India is estimated at US$ 470 Billion in 2011. The Food & Grocery
segment is the largest retail category and accounts for about 70% of the total retail market.
The Indian retail sector can be broadly classified into:
A) Food and Grocery Retailers
There are large number and variety of retailers in the food-retailing sector. Traditional types of
retailers, who operate small single-outlet businesses mainly using family labour, dominate this
sector. However the growth rate of super market sales has being significant in recent years because
greater numbers of higher income Indians prefer to shop at super markets due to higher standards of

hygiene and attractive ambience. In 2007, the food and grocery segment was valued at Rs 7,920
billion, and it enjoyed a dominant market share of 62% in the total Indian retail sector ; The food and
grocery segment is the second largest in the organised retail and has an 11.5% share that is valued at
Rs 90 billion.
B) Fashion and Accessories
Fashion and accessories is the largest category in organised retail and had a 38.1% share valued at Rs
298 billion in 2007. In terms of total retail, this category held the second position with a 9.5% share
valued at Rs 1,313 billion. The segment has driven the retail boom in India and has opened many
opportunities for large as well as global retailers to enter the segment. Despite the high rental, many
global retailers like Gas, Gucci, Levi’s, Benetton,
Marks and Spencer have opened their stores in India, and also have plans to increase their presence.
C) Footwear
In 2007, the footwear segment had a 1.1% share in the total retail market and was valued at Rs 160
billion while it had a 9.9% share in the organised market and was valued at Rs 77.5 billion. In the
same year the organised footwear market recorded a fantastic growth of 49% over 2006 while the
overall retail market grew by just 16.4%. There already are a large number of players, both domestic
and international, in the semiformal, formal and casual segment but the casual segment dominates
the Indian footwear market with a 75% share. Branded sportswear is also growing at a faster rate
than the other segments and the key players in this segment are Adidas, Reebok, Nike, Puma et al.
D) Home and Office Improvement
In 2007, the home and office related retail segment was valued at Rs 455 billion in the total retail
market while it was valued at Rs 50 billion in the organised retail market. In the same year the
segment had a 6.4% share in the organised retail.
E) Catering services
In 2007, the catering service in organised retail showed a tremendous growth of 44.7% over the
previous year. It was valued at Rs 713 billion in the total retail market and at Rs 57 billion in the
organised retail market. The catering services market is divided into fast food, cafes and restaurants
and others

F) Telecom
In 2008, the telecom market in India was worth Rs 272 billion and had a 1.8% share in the total retail
market while it had a 3.4% share in the organised retail segment and was valued at Rs 27 billion. The
mobile and accessories segment exhibited tremendous growth in 2007. Some leading telecom
retailers are The Mobile Store, MobileNXT.
G) Pharmaceuticals
In 2007, the pharmaceuticals market had a 3.5% share and was valued at Rs 488 billion in the total
retail market; However, its share in the organised retail market accounted for merely 2.0% share at
Rs 15.4 billion during the same period.
Few pharmaceutical retailers: Apollo Pharmacy, MedPlus
H) Beauty and wellness
In 2007, the beauty and wellness segment grew at a tremendous rate of 65% over the previous year in
the organised retail market. Its share in the total retail market, however, was just 0.3% and was
valued at Rs 46 billion. Few beauty and wellness retailers are Reliance Wellness, Himalaya Drugs.
I) Jewellery
In 2007, jewellery retail was worth Rs 694 billion and accounted for 5% of the total retail market. In
the organised retail market, jewellery retail merely had a 2.9% share at Rs 23 billion. In the same
year jewellery retail in the organised retail market recorded high growth of 36.9% over 2006 as
compared with 15.3% recorded in the total retail market.
Few jewellery retailers: Gitanjali, Tanishq, Reliance Jewels.
J) Time wear
In 2007, the Indian watches market enjoyed a 2.9% share in the overall organised retail market as
compared with merely 0.3% in the total retail market. The market size of the watch market was
valued at Rs 44 billion in the same year. International players like Tag Huer, Rado, Omega, Rolex,
have signed up Indian celebrities as brand ambassadors to tap the market. Few time wear retailers are
Citizen, Titan etc.
K) Books, music and gifts
Books, music and gift retailing were the earliest segments that witnessed a consolidation of business
into organised formats. The combined share of this segment was 1.1% of the total retail market at Rs

164 billion in 2007. Organised retailers like Planet M, Music World, and Landmark dominated the
music segment. Archies, a prominent gift retailer, has a presence on both high streets as well as in
malls. Moreover, format chains like Crossword, Landmark, Oxford, and now, Odyssey that fit into
the leisure aspirations of people are located conveniently, and offer an ambience conducive to
browsing and book buying. As a result, the segment has been growing further.
L) Entertainment
In 2007, the entertainment segment was worth Rs 456 billion and had a 3.2% share in the total retail
industry. This segment has been driven by the increasing base of young population in India, whose
entertainment needs has been surging with the influx of malls and multiplexes that provide leisure
retail, gaming, and cinema. Players in the segment are likely to gain greater market share as the
consumers spending on entertainment is increasing. PVR cinemas, Fun Cinemas, Inox are the major
players in the entertainment retailing space.
Table 1.2: Segment wise analysis of Total. Organised and Traditional Retail Market in India (2012)
Note: Figures in parentheses show the percentage share in total.
Source: Compilation and calculations using information from (i) Deloitte (2013), “Indian Retail
Market Opening more doors”, January (ii) ASA (2013). A Brief Report on Retail Sector in India,
August and (iii) Michael Page (2013), The Indian Retail Sector Report 2013

1.2.5. Major Retailing Formats
The Indian retail industry is categorised into different retail formats on the basis of the retail
operation. The formats are basically defined on the basis of the size of the outlet, the pricing strategy
followed, the type of merchandise sold, and also the location.
Table 1.3: Organised Retail Formats in India with Its Description and Key Players
Source: RETAIL LANDSCAPE IN INDIA AN ANALYSIS Dr. A. Jayakumar, K. Geetha International
Journal in Multidisciplinary and Academic Research (SSIJMAR) Vol. (3)
1.2.6 Challenges in Retail sector
International Standards:
India has well over 5 million retail outlets of different sizes and styles; it still has a long way to go
before it can truly have a retail industry at par with International standards. This is where Indian
companies and International brands have a huge role to play.
Inefficient supply chain management:
Indian retailing is still dominated by the unorganized sector and there is still a lack of efficient supply
chain management. India must concentrate on improving the supply chain management, which in
turn would bring down inventory cost, which can then be passed on to the consumer in the form of
low pricing.

Lack of Retail space:
Most of the retail outlets in India have outlets that are less than 500 square feet in area. This is very
small by International Standards.
Cultural Diversity:
India's huge size and socio economic and cultural diversity means, there is no established model or
consumption pattern throughout the country. Manufacturers and retailers will have to devise
strategies for different sectors and segments which would be challenging.
Real estate issues:
The enormous growth of the retail industry has created a huge demand for real estate. Property
developers are creating retail real estate at an aggressive pace. With over 1,000 hypermarkets and
3,000 supermarkets projected to come up by 2011, India will need additional retail space of
700,000,000 sq ft (65,000,000 m2) as compared to today.
Human resource problems:
Trained manpower shortage is a challenge facing the organized retail sector in India. The Indian
retailers have difficulty in finding trained person and also have to pay more in order to retain them.
This again brings down the Indian retailers profit levels.
Frauds in Retail:
Frauds, including vendor frauds, thefts, shoplifting and inaccuracy in supervision and administration
are the challenges that are difficult to handle. This is so even after the use of security techniques,
such as CCTVs and POS systems. As the size of the sector would increase, this would increase the
number of thefts, frauds and discrepancies in the system.
Challenges with Infrastructure and Logistics:
The lack of proper infrastructure and distribution channels in the country results in inefficient
processes. This is a major hindrance for retailers as a non-efficient distribution channel is very
difficult to handle and can result in huge losses. Infrastructure does not have a strong base in India.
Transportation, including railway systems, has to be more efficient. Highways have to meet global
standards. Airport capacities and power supply have to be enhanced. Warehouse facilities and timely
distribution are other areas of challenge. To fully utilize India's potential in retail sector, these major
obstacles have to be removed.

1.2.7 FUTURE AND TRENDS IN INDIA RETAIL
 The biggest opportunities for international brands are in the food and beverage segment and also in
the jewellery segment.
 The business of fashion accounts for major position in total organised retail segment in the country.
Hence, this retailing has indeed been responsible for single-handedly driving the business of retail in
India
 A good talent pool, unlimited opportunities, huge markets and availability of quality raw materials at
cheaper costs is expected to make India overtake the world's best retail economies by 2042,
according to industry player.
 The retail industry in India will be a major employment generator in the future. Currently, the market
share of organised modern retail is just over 4 per cent of the total retail industry, thereby leaving a
huge untapped opportunity.
 According to Technopak estimates, The Indian retail sector is expected to see an investment of over
$30 billion within the next 4-5 years, catapulting modern retail in the country to $175-200 billion by
2016.
 The BMI India Retail Report for the third-quarter of 2010, forecasts that the total retail sales will
grow from US$ 353 billion in 2010 to US$ 543.2 billion by 2014. With the expanding middle and
upper class consumer base, there will also be opportunities in India’s tier II and III cities. The greater
availability of personal credit and a growing vehicle population to improve mobility also contribute
to a trend towards annual retail sales growth of 11.4 per cent.
 The retail market in India is estimated at $470 billion in 2011 and is projected to grow to $675 billion
by 2016, with a CAGR of 7.5 per cent over the next five years, according to consulting firm
Technopak Advisors.

2. COMPANY PROFILE
"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
2.1 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 US$ 66 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, retail,
infotel and special economic zones.

2.2 Reliance Retail Limited
Reliance Retail Ltd. is a subsidiary company of Reliance Industries. Founded in 2006 and based
in Mumbai, it is the largest retailer in India in terms of revenue. Its retail outlets offer foods,
groceries, apparel and footwear, lifestyle and home improvement products, electronic goods, and
farm implements and inputs. The company’s outlets also provide vegetables, fruits and flowers. It
focuses on consumer goods, consumer durables, travel services, energy, entertainment and leisure,
and health and well-being products, as well as on educational products and services
A world class shopping environment, state of art technology, a seamless supply chain infrastructure,
a host of unique value-added services and above all, unmatched customer experience, is what this
initiative is all about. With a vision to generate inclusive growth and prosperity for farmers, vendor
partners, small shopkeepers and consumers, Reliance Retail Limited (RRL), was set up to lead
Reliance Group’s foray into organized retail.
With a 27% share of world GDP, retail is a significant contributor to overall economic activity across
the world. Of this, organized retailing contributes between 20% to 55% in various developing
markets. Of this, presently, organized retailing is about 5%. This is expected to grow to 10% by
2011. RRL has embarked upon an implementation plan to build state-of-the-art retail infrastructure
in India, which includes a multi-format store strategy of opening neighbourhood convenience stores,
hypermarkets, and specialty and wholesale stores across India.
RRL launched its first store in November 2006 through its convenience store format ‘Reliance
Fresh’. Since then RRL has rapidly grown to operate 590 stores across 13 states at the end of 2007-
08. RRL launched its first ‘Reliance Digital’ store in April 2007 and its first and India’s largest
hypermarket ‘Reliance Mart’ in Ahmadabad in August 2007. RRL has also launched its first few
specialty stores for apparel (Reliance Trends), footwear (Reliance Footprints), jewellery (Reliance
Jewels), books, music and other lifestyle products (Reliance Timeout), auto accessories and service
format (Reliance AutoZone) and also an initiative in the health and wellness business through
‘Reliance Wellness’.
In each of these store formats, RRL is offering a unique set of products and services at a value price
point that has not been available so far to the Indian consumer. Overall, RRL is well positioned to
rapidly expand its existing network of 590 stores which operate in 57 cities.
During the year, RRL also focused on building strong relationships in the agri-business value chain
and has commenced marketing fruits, vegetables and staples that the company sources directly to
wholesalers and institutional customers. RRL provides its customers with high quality produce that
has better shelf life and more consistent quality than was available earlier.

RRL has made significant progress in establishing state-of-the-art staples processing centres and
expects to make them operational by May 2008.
Through the year, RRL also expanded its supply chain infrastructure. The Company is fully geared to
meet the requirements of its rapidly growing store network in an efficient manner.
Recognizing that strategic alliances are going to be a key driver to its retail business, in FY 2007-08,
RRL established key joint ventures with international partners in apparel, optical and office products
businesses. Further, RRL continue to seek synergistic opportunities with other international players
as well. Across India, Reliance Retail serves over 2.5 million customers every week. Its loyalty
programme, "Reliance One", has the patronage of more than 6.75 million customers. This year, RRL
will continue its focus on rapid expansion of the existing and other new formats across India.
Reliance is gearing up to revolutionize the retailing industry in India. Towards this end, Reliance is
aggressively working on introducing a pan-India network of retail outlets in multiple formats.
 Popular Profiles at Reliance Retail
Management team
Name Designation
Mr. Mukesh Ambani Chairman & Managing Director
Nikhil R Meshwani Executive Director
Hital R Meshwani Executive Director
Madhumita Mohanti Deputy General Manager
Akashay Lokhande Area Manager-Operation &Sales and NSO
Devandra Chawla Vice-President-Business Head, Merchandise
Head
Zubin Nowrojee, Mangement State Head Category

 Formats of reliance retail
There are over 45 Subsidiaries & divisions of Reliance Retail. Following is the list of major
divisions:
1. Reliance Fresh - Retail outlets of fruits, vegetables & groceries.
This division is yet to become profitable.
2. Reliance Digital - Consumer Electronics retail stores. It had 139
stores in Mar 2013.
3. Reliance Jewels - Jewellery; It had revenues of approx. Rs.
8 billion in financial year 2012-13.
4. Reliance Time Out - Lifestyle store of Books, Music, Movies, Toys, Gaming, Fragrances, and
Stationery.
5. Reliance Trends, Reliance Footprint and Reliance Living - Apparel and Clothing. It had revenues
of approx. Rs. 16 billion in financial year 2012-13.
 Financial position
It had a turnover of Rs. 108 billion in the financial year 2012-13. Approx. 56 per cent of this
revenue came from its 'value and other' segment that operates grocery chains Reliance Fresh,
Reliance Super and Reliance Hyper.
Reliance Retail has announced revenues of Rs. 34.74 billion for the first quarter of 2013,
showing 53% jump from 2012. The company also reported operating profit of Rs. 700 million for
the same quarter. Reliance reported quarterly profit of Rs. 106 Crore (for Oct 2013 - Dec 2013).
Source: Economic Times

 Corporate social responsibility
Today when most of the companies are busy in making profits by any means, there are few ones
who are focused to return this society, a part of what they have earned through this society.
Reliance retail is one of them. Following efforts of reliance retail are aimed at benefiting the
society making reliance socially responsible:
1) Reliance Retail is planning to train students from corporation schools and schools run by NGOs
and they consider this as a part of their corporate social responsibility .They will take students on
an employment basis and pay them a stipend during the course period in return they are planning
to charge a "small fee" from those who want to join the course "as we want to bring in some
discipline and regularity among the students", and will reimburse that once they are inducted into
service.
2) Farming in India is highly fragmented and subject to harsh climatic conditions: once harvested,
it is very difficult to keep fruits and vegetables fresh. To secure high quality, Reliance Retail is
directly sourcing fresh agricultural produce from thousands of farmers from villages through
Collection Centers. With this concept, Reliance has built a business model generating shared
value that links the company supply chain more closely to poor farmers in Indian villages.
Reliance is providing a guaranteed market for the farmers’ produce, reducing transaction costs
and training the farmers in better and sustainable farming practices. This initiative has resulted in
higher income and upgrading of skills for the farmers, and reduced spoilage of produce (up to 35
percent) and better quality products for Reliance retail stores.
 Future plan
Five years after halting expansion in the neighbourhood supermarket space, Mukesh Ambani led
is once again planning to open new value retail stores across the country. RRL will launch five
supermarket stores in Bangalore and 15 in other parts of the country as part of its cluster strategy
of increasing density of stores in one state completely. The roll-out of more stores across
markets will intensify over the next few months as the retailer regains confidence in getting its
strategy and merchandising. Value retailing accounts for 55% of RRL's total turnover of Rs
14,500 crore. RRL recorded a net profit of Rs 182 crore in FY14, its first profits in its eight-year
existence. Currently, there are 602 Reliance Retail value formats across the country.

 Competitors
STORE
FORMAT
(CATEGORY)
RRL’S (Reliance
Group’s) VENTURE
COMPETITION INDUSTRIAL
GROUP/FAMILY
Malls and
Hypermarkets
RELIANCEMART® Pantaloons Retail
(47)
Pantaloons Factory
Outlets (37)
Big Bazaar (116
stores)
Big Bazaar Best
Deals (3 stores)
Big Bazaar Express
(3 stores)
BIYANI GROUP
Star India Bazaar TATA GROUP
Shopper’s Stop (27
stores)
K. RAHEJA GROUP
Spencer’s
Hypermarket (250
stores)
RPG (Ram Prasad
Goenka) GROUP
Organized
‘Kirana’ or
Neighborhood
grocery stores and
grocery
supermarkets
RELIANCE FRESH ®
RELIANCE SUPER ®
RELIANCE DELIGHT
®
Food Bazaar (168
stores)
BIYANI GROUP
Food World RPG (Ram Prasad
Goenka) GROUP
Trinethra /Birla
Supermarkets (619
stores)
A.B. BIRLA GROUP
Apparels and
fashion
accessories
RELIANCE
TRENDS ®
Brand Factory,
Fashion Station,
Blue Sky, Celio,
Central, Lee Cooper
BIYANI GROUP
Trent Westside (38
stores)
Trent Fashion Yatra
TATA GROUP
Consumer
Electronics
RELIANCE
DIGITAL ®
Croma Retail (34
stores)
TATA GROUP
Books and Music
stores
RELIANCE
TIMEOUT ®
Depot (116 stores) BIYANI GROUP
Landmark (10
stores)
TATA GROUP
Jewels Reliance Jewels® Navaras BIYANI GROUP
Tanishq Jewellery TATA GROUP

2.3 RELIANCE FRESH
APKA FRESH APKE PADAOS ME
Reliance fresh is the retail chain division of reliance industries of India which is headed by Mukesh
Ambani. It is the convenience store format which a part of Reliance Retail limited, a fully subsidiary
of Reliance Industries Limited. Reliance has entered into this segment by opening new retail stores
into almost every metropolitan and regional area of India. The reliance fresh supermarket chain is Rs.
25,000 crore ventures and wishes to have a pan-India presence.
RRL launched its first store in Hyderabad in November 2006; major focus was on selling fresh fruits
and vegetables at lower prices by eliminating the middle men and intermediaries. Reliance fresh
came with concept of farm to fork theory, which focussed on taking the supply direct from the
farmers and then selling straightaway to the consumers removing the middle-men off the beaten
track. These stores sell fresh fruits and vegetables, staples, groceries, fresh juice bars dairy products
and non vegetarian products. It sought to provide the consumer affordable and quality produce in a
congenial and pleasing environment and enforced stringent quality and hygiene guidelines which
would help it bring high value to the consumer. Company has expanded its supply chain
management and is capable of handling it rapidly growing stores network effectively and efficiently.
Reliance Retail has decided to minimize its exposure in the fruit and vegetable business and position.
Reliance Fresh as a pure play super market was 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.
Recent headlines is, Reliance Retail is planning to shut down over 100 Reliance Fresh stores that
largely sell fresh produce and groceries, as it increases its focus on India's $450 billion wholesale
cash-and-carry business. At present, Reliance Retail operates around 550 Reliance Fresh stores; and
a typical store is spread over around 3,500 square feet and caters to a catchment area of 2-3 km.

Vision
To generate inclusive growth and prosperity for farmers, vendor partners, small shopkeepers and
consumers.
Objectives
The chief objective of Reliance Fresh stores is:-
1) To provide customers first-rate household products at affordable rates.
2) To spares no effort to safeguard the interest of the farmers and manufacturers.
3) The producers get a chance to sell their products directly to the merchandiser, and that too at the
best price.
Thus, it is a win-win situation for all, the merchandiser, and producer and consumer
Merchandise Offered:
 Baby foods and baby-care products such as disposable diapers
 Breads and bakery products (many stores may have a bakery on site that
 offers specialty and dessert items)
 Bulk dried foods such as legumes, flour, rice, etc. (typically available for
 self-service)
 Canned goods and dried cereals and delicatessen foods (ready-to-eat)
 Confections , candies and dairy products
 Cosmetics and Feminine hygiene products
 Electrical products such as light bulbs, extension cords, etc.
 Frozen foods
 Fresh produce, fruits and vegetables
 Housecleaning products
 House wares, crockery and cooking utensils, etc. (typically limited)
 Laundry products such as detergents, fabric softeners, etc.
 Non-alcoholic beverages such as soft drinks, juices, bottled waters, etc.
( some stores may have a juice bar that prepares ready-to-drink freshly squeezed juices, smoothies,
etc.)
 Personal hygiene and grooming products
 Seasonal items and decorations
 Soft-Drinks

Store Layout and Design
Store Layout: Grid Type Layout
Grid Type Layout: This type of layout is a retailer’s
primary choice when it comes to layout planning or
designing. This layout makes you feel where and what are
you shopping.
Ambience: Reliance fresh provides good ambience having proper lighting, ventilation facilities.
Products are properly arranged according to category. Customers are provided with trolleys and
baskets to select products on their own. For this purpose, enough space is made available with the
help of grid layout. Air conditions are also used.
Shelving Pattern: use of wall racks, corner racks, retail gondolas, fruits & vegetable racks, shopping
trolleys and baskets, wire products, checkout counter, glass shelves and accessories, gondola end
racks, wall unit racks, wire baskets.
Value chain model
Reliance Fresh (Reliance Retail Ltd) follows a Value Chain Business Model (VCM).Reliance
procures the produces directly from farmers and sell to customers by avoiding intermediaries. This
model is based on its core growth strategy of backward integration and progressing towards building
an entire value chain starting from the farmers to the end consumers. In this practice, farmers,
organized retailer's operational units, consolidation centers, hub (distribution centers) and retail
outlets stores, and customers are players.
Fig 2.1: Value chain Model of Reliance Fresh

Promotional Activities
Promotional schemes: Promotional schemes are more targeted to the impulse buying nature of the
customers. They have in-store promotions, which are majorly given by company on branded products. If
any new schemes are introduced then pamphlets are distributed to customers’ house near the store. POP
displays are used on regularly basis on the selected items. A variety of short term incentives is used to
encourage trail or purchase of a product or service. The sales promotion at Reliance fresh includes
premiums and gifts, Sampling, rebates.
Loyalty schemes, membership cards: Reliance Fresh has started loyalty program on day one and you
get 1 point for every Rs.100 you spend in any of the Reliance Retail stores and you encash the same in
any of Reliance Retail stores be it be Reliance Fresh or Reliance Hypermarket. Reliance Credit Card is
given to the customers. It can be used to purchase goods at various Reliance retail store.
Monthly Shopping Paradise: Shop for 1999 & get gift of Rs. 49.
Shop for 2999 & get gift of Rs. 99.
Point of purchase displays: At Reliance Fresh it is used to communicate the benefits of the products.
The point of purchase is used to communicate promotion with the help of ‘Shelf Talkers’. Shelf Talker is
mode of communication at the shelf where the product is displayed.

CHAPTER- 3
INTRODUCTION OF PROJECT
3.1 Project Title:
‘Study of changing customer’s perception towards modern retail stores and
analysis of supply chain losses at Reliance Fresh’
3.2 Objectives:-
1) To study the factors influencing the consumers to buy fruits and vegetables from organized
retailers
2) To study a comparative analysis of the customer perceptions of Star Bazaar and Reliance stores
3) To analyse the fruits and vegetable supply chain losses at Naroda CPC.
4) To draw managerial implication and suggestion for Reliance stores
3.3 Purpose and scope of study:
The customer’s perception is your reality. –Kate Zabriskie
 The study is based on survey done on customers at various retail outlet selling fruits and
vegetables. It aims to identify the factors influencing the consumers to buy fruits and vegetables
at modern organized retail stores than unorganized retail markets. The project work was carried
out at 2 stores (Reliance fresh at Safal complex; Reliance Mart at ISKON mall) of reliance fresh
and 2 competitor stores (Star Bazaar; Big Bazaar) at Ahmedabad region of Gujarat.
 The study focussed on supply chain losses of fruits and vegetables at Naroda CPC (City
Processing Centre or Wet DC) which is estimated about 2% loss. The project was carried out by
visiting the wet DC everyday and understanding the operation at the floor and observing and
judging where loss can happen.
 Due to strong competition in market, companies wanted to know where Reliance stands in fruits
and vegetable retailing. Thus, the project also involved study of performance of various retail
stores including competitors like star bazaar and big bazaar. Further, a comparative study was
done between star bazaar and reliance fresh store at ISKON mall, as both were located in same
area near Gandinagar highway.
 The study helps the company to understand the satisfaction levels of customers and can improve
on the lacunas they are facing through customer feedback.

3.4 Review of Literature:
 Joseph, Soundararajan, Gupta, & Sahu (2008) concluded in their study- "Impact of
Organised Retailing on the Unorganised Sector", that unorganized retailers in the locality of
organized retailers were adversely affected in terms of their volume of business and profit.
According to them, with the emergence of organized outlets consumers gained through the
availability of better quality products, lower prices, one-stop shopping, choice of additional
brands and products, family shopping, and fresh stocks.
 Gupta, (2012) concluded in her study “Customer Loyalty towards Kiranas in Competitive
Environment; A Case study” that store attributes like convenient operating hours and
accessibility were the factors which lead to customer loyalty and not store appearance. Similarly,
product attributes like freshness of the product and availability of products range according to
the pocket were major determinant of loyalty. It was also evident that even today Kirana stores
are preferred by customers because of various reasons viz. convenient location, home delivery,
personal relations with shopkeeper, giving products on credit, payment in instalments.
 Talreja, jain (2003) concluded in their study “Changing consumer perceptions towards
organized retailing from unorganized retailing – an empirical analysis”, that customers like
to buy fruits & Vegetable from air-conditioned supermarkets because of its quality products but
due to the high prices they still feel conservative to buy these kinds of products either from the
local mobile vegetables seller or from the nearest sabji market. Further it was observed that due
to changes in the disposable income and increased awareness of quality, the consumer’s
perception towards organized and unorganized retailers differs on the basis of quality and price.
Thus it was found that when compared to the unorganized retail format most of the respondent
had a good image about the organized retailers.
 Veena A, K. Nagendra Babu and H.R. Venkatesha studied the “Supply chain: a
differentiator in marketing fresh produce”, As per the survey conducted for this study,
important drawbacks of the current Supply Chain (SC) are number of intermediaries, high level
of wastage, quality degradation, poor infrastructural facilities and high cost. Fresh produce
market has immense influence on the socioeconomic and even political conditions. Close to 30%
of the F&V grown is going waste.

CHAPTER- 4
RESEARCH METHODOLOGY
The project was done in two phases:
Phase 1: For the purpose of the study of front end operation, descriptive research design was used.
Convenience sampling method is adopted for the study. Mall intercept method was used for
collecting the data. The data was collected from four stores, out of which two Reliance and one
store each of Star Bazaar and Big Bazaar was surveyed. A well structured questionnaire was
designed for the study and due care was taken to avoid any kind of ambiguity. The sample for the
study is 100 respondents. Likert type of scale is used for weighting the variables and questions in
general.
Phase 2: For the purpose of understanding supply chain management and analysing the why losses
occur, observation method was used and interaction between manager and staffs was done at
Naroda CPC.
4.1 Research Design:
After the objectives of the survey were well defined, the descriptive research design was
taken.
Description of Study Area:
The Ahmedabad district of Gujarat was taken up for the study. Gujarat has total of 65 stores
and have cash & carry format stores in Anand and Bhavnagar.
Table no 4.1.: Profile of Reliance stores in Gujarat
Source: Reliance Retail Limited, Regional Office, Ahmedabad

Area of Survey:
A. Reliance fresh :
1. Reliance store name: Reliance Fresh (Safal Pegasus)
Address: Shop No. 1, 2, 3, 100Ft Road, Prahlad Nagar
1. Reliance store name : Reliance Mart (Iskon)
Address: Iscon Mega Mall, S.G Highway, Nr. Iscon Temple
B. Star Bazaar: Jodhpur Char Rasta, Satelliate
C. Big Bazaar: Himalaya Mall, Drive in Road
4.2 Nature and sources of data:
In order to evaluate the objectives of the study, data was collected from both primary and secondary
sources.
 Primary data:
The primary data was collected from direct resources (customers of reliance and other retail stores)
using a pre-structured questionnaire as well as interaction with manager and staff of CPC.
 Secondary data:
The secondary data required were collected through various sources like company website,
magazines, internet sources, company leaflet and other sources. Various published reports provided
the information regarding the data about consumer buying behaviour of fruits and vegetable, supply
chain management.
 Method of data collection: Mall intercept method of survey was utilized to collect data from
customers at retail stores and observation method was used at Naroda CPC.
4.3 Research instrument:
Questionnaire: Questionnaires were used for the collection of primary data. The questions are both
open and close ended in nature and multiple choice questions were involved in questionnaire. In
open ended questions customers were free to answer and in multiple choice questions,
respondents were offered various options to choose from. The questions were framed in simple
language with orderly arrangement, so that initially a good rapport can be developed between the
interviewer and the respondent.
Research technique:
Convenience sampling was done. Both Qualitative and Quantitative research techniques were used.

Tools and techniques of analysis:
Simple tools of analysis like Mean, Percentage, Frequency, tabular analysis and graphical method,
simple ranking, and cumulative methods, were used.
4.4 Sample Design:
Sampling Method:
4 modern retail stores (2 reliance stores and other 2 competitor stores) in Ahmedabad city were
purposively selected as they were having highest footfalls. The customers were selected randomly
during their visit to the F & V section.
Sampling Size:
A sample of total 100 customers was drawn at two Reliance stores and competitor stores, of
Ahmedabad city of Gujarat, according to table mentioned below:
Stores No of Consumers
Big Bazaar 20
Reliance Fresh (Iscon) 30
Reliance Mart (Safal) 30
Star Bazaar 20
Grand Total 100
4.7 Limitation of the study:
1. Adequate efforts have been taken to accomplish the research according to the objectives, but due
to small sample size of respondents which otherwise would have obviously given better results.
2. The project work was required to be completed in one month. So there was limited time available
and therefore, only selected retail stores where large number of footfalls was included in study but
these were distant from each other.
3. Many respondents were reluctant in giving feedback and considered interviewer as nuisance.
4. Ahmedabad, being one of cities having highest traffic and crowded roads, it was difficult to reach
on peak time of customers buying fruits and vegetables.
5. Project was done during rainy season and Ahmedabad was flooded for 4 days, thus on those days,
survey couldn’t be done.
6. Access to internal records of company was not available.

CHAPTER- 5
DATA ANALYSIS
Demographic Profile of Customers
A survey of total 100 customers was undertaken at different retail stores. In this survey, data related
to age, gender, education, occupation and income level of customers were collected.
Target customers- Age wise:
Table No 5.1: Age group of target customers (in years) n= 100
Fig no 5.1: Age group of target customers (in years) n= 100
This figure shows that most of the respondents (45%) belonged to the 30-45 yrs age group, followed
by 32% of the respondents falling in the age group of 45-60 years. About 18% of total respondents
were less than 30 years. Only 5% customers were aged above 60 years. Due to changes in the
disposable income and faster pace of life, Middle- aged customers prefer ‘one stop, one shop’ and
are more aware of quality and hygiene. Thus more customers from group of 30-45 prefer buying
fruits and vegetables from modern retail stores.
18
45
32
5
0
10
20
30
40
50
less than 30 30-45 45-60 >60
Age wise Distribution (in years) n=100
No of respondents
Age No of respondents %
less than 30 18 18
30-45 45 45
45-60 32 32
>60 5 5
Grand Total 100 100

Target customers- Gender wise:
Table No 5.2: Gender wise distribution of target customers (n= 100)
Gender No Of Respondents %
Male 49 49
Female 51 51
Grand Total 100 100
Fig No 5.2: Gender wise distribution of target customers (n= 100)
The demographic characteristics of the respondents (fig-) show that majority of respondents (51%)
were female. 49% of total customers were males. With more and more women entering into job, they
seek proximity, convenience, and easy availability of quality product and services. Thus, they prefer
buying from organized retail stores than unorganized retail stores.
Target customers-Marital status:
Table No 5.3: Marital status of target customers (n= 100)
Marital Status No of Respondents %
Married 82 82
Unmarried 18 18
Grand Total 100 100
49%
51%
Gender- wise Distribution
n=100
Male
Female

Fig No 5.3: Martial status of target customers (n= 100)
The pie chart indicates that majority, 82% of total customers surveyed, were married and only 18%
were unmarried. It was observed that most couples used to shop during weekends and holidays.
Education Qualification of Target Customers:
Table No 5.4: Education qualification of target customers (n= 100)
Education No of respondents %
Illiterate 1 1
Below SSC 0 0
SSC 6 6
Hsc 1 1
Diploma 1 1
Graduate 72 72
Post graduate 19 19
Grand Total 100 100
82%
18%
Maritial Status of Target customer
Married Unmarried
n=100

Figure No 5.4.: Education qualification of target customers (in years) n= 100
The graph shows that majority of customers, 72 % were graduates followed by post graduates
(19%). 6% of total customers had passed tenth and rest were Hsc and diploma holders. Only one
customer was found illiterate. Survey shows that education level also played dominant role in
preference of organized retail outlets.
Occupation of target customers
Table No 5.5: Occupation of target customers ( n= 100)
Occupation No of respondents %
Home maker 32 32
Student 10 10
Service 42 42
Business 8 8
Others 8 8
Grand Total 100 100
1 0 6 1 1
72
19
0
20
40
60
80
Illiterate Below SSC SSC Hsc Diploma Graduate Post
graduate
Education Qualification of Target Customer
n=100
No of respondents

Fig No 5.5: Occupation of target customers (in years) n= 100
The pie chart shows that, out of total respondents, 42% were doing service. 32% were home makers
followed by 10% of students. 8% of them were businessmen and others respectively. Others included
news reporter, retired army officers.
Annual income of target customers:
Table No 5.6: Annual income of target customers (in Rs.) n=100
Annual Income No of respondents %
2-4 Lakhs 5 5
4-5 lakhs 55 55
5-10 lakhs 40 40
> 10 lakhs 0 0
Grand Total 100 100
The Table shows that out of total customers, 55% customers had annual income between 4-5 lakhs.
40% of total respondents earned around 5-10 lakhs whereas 5% of them earned 2-4 lakhs. Upper
middle class households prefer shopping from modern retail stores.
32%
10%42%
8%
8%
Occupation Of The Target Customer
Home maker
Student
Service
Business
Others
n=100

Fig No 5.6: Annual income of target customers (in Rs.) n=100
Target- customers: No of family members
Table no 5.7 No of family members of target customers (n=100)
No of Family
members
No of respondents % of
respondents
Less than 5 94 94
More than 5 6 6
Grand total 100 100
The Table shows that majority (94%) of total footfalls have less than five members in family. Only
6% of the total customers were having more than five members.
Fig no 5.7: No of family members of target customers n=100
5%
55%
40%
Annual Income of Respondents
2-4 Lakhs
4-5 lakhs
5-10 lakhs
> 10 lakhs
n=100
94%
6%
No of Family Members of Target
Customers
Less than 5
More than 5
n=100

Customer’s preference and buying behaviour regarding fruits and vegetables
 From where do you prefer to buy fruits and vegetables?
Table no 5.8: Place Preference to buy F & V
Preference to
buy
No of
respondents %
Mandi 7 7
Supermarket 73 73
Both 20 20
Grand total 100 100
Fig no 5.8: Place Preference to buy F & V n=100
The graph above shows that majority (73%) of total customers prefer to buy fruits and vegetables
from modern supermarkets. Only 7% of them buy fruits and vegetable from local mandis. About
20% of the total respondents prefer to buy fruits and vegetable from both supermarkets and
mandis.
Thus there is shift of customers buying fruits and vegetables from unorganized mandis to
organized supermarkets.
 Which store do you prefer most for purchasing fruits and vegetables?
Table no 5.9: Store Preference to buy F & V
Store Preference No. Of Respondents % of
Respondents
Reliance 61 61
Star Bazaar 27 27
Big Bazaar 8 8
Hyper city 4 4
Grand Total 100 100
7%
73%
20%
Place Preference to buy F & V n=100
Mandi
Supermarket
Both

Fig no 5.9: Store Preference of target customer to buy F & V
The graph shows that out of total respondents, 61% preferred Reliance stores for buying fruits and
vegetables. 27% of total respondents preferred shopping from Star Bazaar. Only 8% and 4% of
total customers preferred buying F & V from Big Bazaar and Hyper City respectively.
 How frequent do you buy fruits and vegetables from these retail stores?
Table No 5.10: Frequency of buying fruits and vegetables from retail stores (n=100)
Frequency of buying No of respondents %
Daily 4 4
Weekly 92 92
fortnightly 3 3
Monthly 1 1
Grand Total 100 100
0
10
20
30
40
50
60
70
Reliance
Star Bazar
Bigbazar
Hypercity
61%
27%
8%
4%
Stores Preferred for Buying F & V
Reliance
Star Bazar
Bigbazar
Hypercity
n=100

Figure No 5.10: Frequency of buying fruits and vegetables from retail stores (n=100)
The graph shows 92% of total customers bought fruit and vegetables weekly. Out of total
respondents, 4% bought daily and used to live near the stores and 3% of total customers used to
buy fortnightly. Only 1% of total customer used to buy monthly (Ruchita Mehta, Star Bazaar
customer used to stay alone, generally preferred eating out).
 Which day preferred to shop?
Table no 5.11: Days Preferred to buy F & V (n=100)
Prefer to shop
No of
respondents %
Any day 88 88
Week-ends 8 8
Wednesday 4 4
Grand Total 100 100
Fig no 5.11: Days preferred to buy F & V (n=100)
Daily
Weekly
fortnightly
Monthly
4%
92%
3%
1%
Frequency of Buying F & V From Retail
Stores
Daily Weekly fortnightly Monthly
0
50
100
Any day
Week-ends
Wednesday
88%
8%
4%
Prefer to shop
Any day Week-ends Wednesday
n=100
N=100

The bar chart shows that 88% of total customers prefer to shop on any day according to their
convenience. 8% of the total customers prefer to buy vegetables and fruits on week-ends, when it is
day off for them. Only 4% of total customers prefer to buy fruits and vegetables on Wednesdays as
most of the retail stores have discount and special offers on the particular day.
 How do you buy fruits and vegetables from this store?
Table no 5.12: Buying Pattern of F & V by Target Customers (n=100)
Buying of F & V No of respondents %
Prior Planning 1 1
Un-Planned 99 99
Grand Total 100 100
Fig no 5.12: Buying Pattern of F & V by Target Customers (n=100)
The pie chart states that majority (99%) of customers used buy fruits and vegetables randomly.
Only 1% of the total respondents planned and brought the fruits and vegetables. (kimi patel, a
customer of Reliance Safal, does prior planning to buy fruits and vegetables )
0
100
Prior Planning
Un-Planned
1
99
Buying Of Fruits and Vegetables
Prior Planning
Un-Planned
n=100

Objective (1): To study the factors influencing the consumers to buy fruits and
vegetables from organized retailers
Table no 5.13: Factors influencing the consumers to buy fruits and vegetables from organized
retailers
High influenced =3, Medium influenced =2, Low influenced=1
Note: Maximum Rating :( Maximum Scale 3 *100 Respondents) =300(Max)
Fig no 5.13: Factors influencing the consumers to buy fruits and vegetables from organized
retailers (n=100)
Price
Qualit
y
Brand
name
Conve
nience
Availa
bilty of
Season
al FV
Availa
bilty of
exotic
varieti
es
Availa
bilty of
FV
during
Festiva
l and
seas…
Time
saving
in
billing
proces
s
Ambie
nce
Promo
tional
Offers
Freshn
ess
Culumulative score 265 288 193 284 278 189 268 276 259 234 290
0
50
100
150
200
250
300
350
AxisTitle
Factors Considered By Customers While Purchasing F & V
7 2 3 4
6
5 8 9 110 11
n=100
SR.No Parameters High Medium Low Culumulative
score
Mean Rank
1 Price 71(213) 23(46) 6(6) 265 2.65 7
2 Quality 88(264) 12(24) 0(0) 288 2.88 2
3 Brand name 23(69) 47(94) 30(30) 193 1.93 10
4 Convenience 87(261) 10(20) 3(3) 284 2.84 3
5 Availability of
Seasonal FV
78(234) 22(44) 0(0) 278 2.78 4
6 Availability of exotic
varieties
24(72) 41(82) 35(35) 189 1.89 11
7 Availability of FV
during Festival and
seasonal occasion
71(213) 26(52) 3(3) 268 2.68 6
8 Time saving in
billing process
78(234) 20(40) 2(2) 276 2.76 5
9 Ambience 61(183) 37(74) 2(2) 259 2.59 8
10 Promotional Offers 47(141) 40(80) 13(13) 234 2.34 9
11 Freshness 90(270) 10(20) 0(0) 290 2.9 1

The main objective of the project was to find out the factors that influenced customers to buy fruits
and vegetables from modern retail store. Majority of customers considered freshness and quality
as prime factor that influenced them to buy fruits and vegetables from these stores.
Convenience was another major factor that influenced the customers to shop at these organized retail
stores. Availability of Seasonal fruits and vegetables may not be consistent at kirana stores and
mandis, thus most of customers used to shop at modern retail stores. Some customers considered
factors like timely billing process, price, and availability of FV during festivals and special occasions
that influenced them to buy fruits and vegetables from these stores. Availability of exotic fruits and
vegetables, brand name, and promotional offers were least considered by respondents.
Objective (2): To carry out a comparative analysis of the customer perceptions of
stores of Star Bazaar and Reliance Fresh.
 Whether you have visited Reliance Mart at Iskon mega mall?
Table no 5.14: Visit to Reliance Mart
Out of total respondents surveyed, 78% had visited Reliance Iskon and 22 % haven’t visited
Reliance Iskon. Out of 78 footfalls who visited Reliance Iskon, only 62 respondents visited
Star Bazaar and rest 8 didn’t visit Star Bazaar, so for comparison of Iskon and Star Bazaar,
sample size of 62 was taken.
 How would you compare reliance fresh at Iskon mega mall over Star bazaar?
n=62
Table no 5.15: Comparison of Star Bazaar and Reliance Mart
Sr. No Parameters Reliance Iskon Star Bazaar Both
1 Price 31 29 2
2 Quality And grading of FV 17 44 1
3 Brand Name 21 34 7
4 Convenience 22 39 1
5 Availability of seasonal Fv 19 41 2
6 Availability of exotic Fv 17 43 2
Visit to Iskon Bazaar No of
Respondents
% of
Respondents
yes 78 78
No 22 22
Grand Total 100 100

7
Availability of FV during
festivals and special
occasion 19 41 2
8
Time saving in billing
process 20 40 2
9 Ambience 27 34 1
10 Promotional offers 22 39 1
Cumulative 215 384 21
Rank 2 1
62 customers were asked on various parameters like quality, ambience on which the Reliance Mart at
Iskon Mega Mall and Star Bazaar was compared. Only Price was the parameter in which Reliance
Iskon fared well. There were few people who preferred both the retail stores. Thus Reliance Iskon
needs to create better positioning in minds of customers.
How are you satisfied by Reliance Stores on the following parameters according to scale?
Highly satisfied=5; Satisfied= 4; moderately satisfied= 3; Unsatisfied= 2; highly unsatisfied=1
Table no 5.16: Satisfaction Level of target customer at Reliance Stores (n=100)
The table indicates the satisfaction level of target customers towards Reliance retail stores. Most of
customers were highly satisfied with employee’s behaviour and brand image of the company.
Customers were satisfied by price and cleanliness & hygiene of retail stores. Respondents were
Parameters Cumulative score Mean Rank
Price 383 3.83 3
Quality 357 3.57 7
Freshness 355 3.55 8
Convenience 367 3.67 5
Availability of product 358 3.58 6
Cleanliness and hygiene 383 3.83 3
Product Assortment 337 3.37 9
Brand image 386 3.86 2
Appeal 370 3.7 4
Employee's behaviour 399 3.99 1
Max Rating ( maximum scale, 5*100 consumers) = 500 (Max)

moderately satisfied by quality, freshness and availability of products. Most of customers were
unhappy with the product assortment and rated less score for it.
Fig 5.14: Satisfaction Level of target customer at Reliance Stores (n=100)
Performance evaluation of different retail stores based on different parameters
Rank 1= 3, Rank 2= 2, Rank 3= 1
Table no 5.17: Performance evaluation of different retail stores based on
Different parameter (n=100)
3.83
3.57 3.55
3.67
3.58
3.83
3.37
3.86
3.7
3.99
Customer Satisfaction OF Reliance Stores
n = 100
3 7 8 5 6
3
9
2 4
1
Sr. No Parameters Reliance Star Bazaar Big Bazaar
1 Price 2.44 2.35 2
2 Quality 2.27 2.52 1.95
3 Freshness 2.38 2.55 1.83
4 Brand 2 2.48 2.33
5 Timely Availability 2.27 2.6 2.18
6 Promotional 2.32 2.51 2.12
7 Customer satisfaction 2.43 2.55 2.14
8 Salesman Behaviour 2.45 2.58 2.08
9 Variety 2.25 2.54 1.74
10 Location 2.29 2.62 2.03
11 Cleanliness 2.32 2.42 2

According to table, in terms of quality and freshness, timely availability of fruits and vegetables,
variety, store location, Star Bazaar fares better than Reliance and Big Bazaar. Reliance‘s ranks better
in case of price. Big bazaar is more preferred brand name compared to Reliance. There is minute
difference between Star Bazaar and Reliance in terms of customer satisfaction. Thus Star Bazaar’s
performance stands out compared to its competitors followed by Reliance and then Big Bazaar.
Thus Star Bazaar is strong competitor to Reliance stores.
Fig 5.15: Performance evaluation of different retail stores based on
Different parameter (n=100)
5.2 Customer’s complaints
• Customers want that their time should not waste after shopping, number of cashiers need to
be increased and separate weighing need to installed for fruits and vegetables
• Vegetables like carrot aren’t available
• Quality of fruits and vegetable isn’t up to mark and freshness doesn’t remain after afternoon.
• Offers and price discount isn’t clearly written on sign board and are not conveyed to
customers.
• Mark-up prices aren’t mentioned at particular time.
• No staff at FFVs counter
• Even after having membership card and giving full payment, staffs still enquires details of the
customer.
25.42
27.72
22.41
0
5
10
15
20
25
30
Reliance Star Bazaar Big Bazaar
Performance Evaluation of Different Retail Stores
Reliance
Star Bazaar
Big Bazaar
n=100
Cumulative Avg. Score 25.42 27.72 22.41
Rank 2 1 3
2 1 3

Objective (3): To analyse the fruits and vegetable supply chain losses at Naroda
CPC.
Fruits and vegetables typically constitute an essential part of the daily diet in India and they are in
great demand round the year from most sections of the population. The commercial value of fruits
and vegetables in terms of direct consumption, processing as well as trade has risen substantially in
recent years.
SCM is the coordination of material flows, information flows and financial flows among all the
participating organizations so as to ensure that the right product in the right place, at the right price,
at the right time, and in the right condition. “It is the supply that compete, and not individual
businesses” – is an accepted saying.
In marketing fruits and vegetables, which are perishable in nature, SC plays a crucial role. The very
nature of land holding by the farmers, varied climate conditions, production spread over worldwide
geographical area, mainly in remote villages, diversified consumption patterns and poor SC
infrastructure make SCM for fruits and vegetables more complicated. Efficient SCM in marketing,
not only increases the profitability and efficiency of retailers, but also adds value to different
stakeholders like farmers, consolidators and consumers.
Value chain model of Reliance Stores
Reliance Fresh (Reliance Retail Ltd) follows a Value Chain business model (VCM) where it
procures the produces directly from farmers and sell to customers by avoiding intermediaries. This
model is based on its core growth strategy of backward integration and progressing towards building
an entire value chain starting from the farmers to the end consumers
Fig 5.16: Supply Chain Operations of Reliance F &V

Procurement
There are three CCs for F&Vs (one each in Prantij, Nenpur and Padra) for Ahmedabad region in
Gujarat. Most of the procurements is done locally i.e. close to the city being services both to
minimize transit time in order to preserve freshness as well as reduce cost. However, some
commodities need to be procured from relatively far off places i.e. regionally e.g. potatoes, or
nationally e.g. apples or even imported e.g. exotic fruits and vegetables, due to availability /
seasonal constraints. Hence, these could be sourced at Mandis (wholesale markets), from traders /
agents (cold stores) or bulk importers. A preliminary quality check (AQR) is done here.
Processing at CPC
From the sourcing point, the material is moved to Central Processing Center (CPC) or wet
distribution centre located at Naroda GIDC. The CPC has mechanical facilities like Wimar
machine for washing and grading of potatoes. At CPC, the produce stays for maximum of 12 hours
or 1 day according to indent. It has capacity to handle 70-80 tonnes of F&V per day. It had controlled
atmosphere facility and has 4 cold storages. The F&Vs were classified into 8-10 product categories;
leafy vegetables, tropical FFVs, basic vegetables, cuts and sprouts, melons, mangoes, apple and
citrus fruits, etc. Only 2% of its FFVs are cut and packed. The CPC is spread over 58000 sq.ft. area
and major activities involved receiving, sorting, grading, allocation and dispatch. Here, the data
(product type, quantity, grade, cost price etc.) is entered into the SAP system for easier
tracking of the inventory. Each store has the minimum order quantity level for each type of product
which is tracked by SAP system. Based on the sales data, as soon as the product level goes below its
minimum order quantity, the SAP system automatically places the order.
Sorting and grading process at CPC

The produce procured from the farmers at CC (collection centres) is graded and put into crates and
sent to CPC which is graded again, if needed, and did store wise crating and packing including
cutting and packing vegetables and fruits. Product is received only from vendors and suppliers,
when AQR (arrival quality report) along with paper –invoice SKU is fulfilled.
An AQR indicates rejection of Non-RR produce and selection of Reliance Retail (RR) grade of fresh
quality produce. Left over or Non-RR is sold back in
the wholesale market or dumped. After that, weighing
in crates and store wise allocation of the produce is
carried for dispatch to stores according to First in First
out basis. Every product is weighted and labelled
according to weights with RFID Tags/Bar codes which
help in maintaining stocks which makes billing faster.
The work at CPC takes place in three shifts, starting
from 9 in morning. But delivery of produce can take
place in early morning. For the afternoon supply and next day supply from CPC to stores, produce is
kept at cold storages and refrigerated vehicles are used. The green leafy vegetables are delivered
twice a day
Daily activities at the stores
 Store opens by 6 AM with help of an armed guards and supervisor
 Daily indent of fruits and vegetables reach by 6 AM
 Merchandise are received by customer associates and stores is ready by 7 AM
 Store manager updates the opening stock, prepares rate list.
 In afternoon , fruits and Vegetables are put on discount an sold at marked down price
 Fruits and vegetables are weighed at counters and sold to customers.
 Indent of next day merchandise is prepared by store manager and supervisors
 Total balance is compared with sale, closing stock is also checked.
 Stores is closed by 10 pm

 Visual quality inspection of bulk produce
 Sorting & grading
 Weighment
 Crating of acceptable bilk source
 Payment to farmers
 Loading of produce in farmer’s owned vehicle or
reefer vans.
Operation performed at Nenpur/Padra/ Prantij collection
centre
Produce being sent to city processing centre
(CPC) at Naroda GIDC
Operation performed at different stores
 Unloading of produce, weighing of arrived material
and confirming with weight taken at collection centre.
 Visual quality inspection according Reliance fixed
parameters through preparation of AQR
 Barcoding of RR F & V
 Dump wastage or selling in market
 Cold storage of green leafy vegetables and exotic
vegetable if needed.
 Crating of the material according to requirement of
stores and dispatch to stores
Produce sent to different Reliance fresh
stores
Operation performed at Central Processing Centre (CPC)
 Unloading of merchandise and store is kept ready
by 6 am
 Discounts and promotion are updated on product
categories
 Fruits and vegetables are put down on discount
(Marked down price) by 4. pm
 Buying of produce by customers and payment
received
Fig 5.17: Flow chart showing detailed SC of Reliance
fresh/mart

Supply chain losses in Fruits and vegetables at CPC and Reliance Stores
Indian consumer demands fresh F&V. The Indian retail cannot be competitive until the supply
chain is made integrated, efficient and customer centric. According to information provided by
manager and staff at Reliance CPC at Naroda, the estimated loss is 2% compared to other CPC in
the country. During study, I could identify some factors that may cause loss at Reliance stores.
Though observation method and secondary data provided by Manager at Naroda CPC, causes and
estimation of wastage was attempted.
Quality specifications and Rejections
Reliance Fresh has specified the quality for different vegetables. For cauliflower, RF preferred
medium (500-700 gms), white, compact curds; without insect pest attack and not exposed to sun-
light. The quality of the vegetables is checked manually first at CC and then again at CPC. The
retail chain procured only the RR grade produce. Thus, farmers have to sell the rejected produce in
the local market. In cabbage also, RF preferred medium to large size lowers, without any cuts and
disease and insect-pest attack. The heads were to be harvested when they were solid (firm to hand
pressure) but before they cracked or split. The leaves were to be unexpanded, crispy and tightly
packed. In tomato, chain bought only big sized tomatoes without any sunscald. In case of okra, RF
prefers long sized, without any insect-pest or virus attack. In banana, slightly ripened, yellow in
colour is preferred. The rejection of product occurs at 3per cent.
Loopholes at back-end
The level of loss and waste from field to retail store together, with views about the causes of fresh
produce waste have been collected. Total loss is estimated to be about 2.68% of total arrivals.
Table 5.18: Top Ten SKUs causing Loss
Sr. No Article
Quantity value
(Kg) Amount in Lakhs
1 Onion 554 8855.13
2 Potato 1748.5 31274.43
3 Tomato 2581.7 31033.91
4 Capsicum green 1658.1 53689.8
5 Bottle gourd 331 6017.34
6 Okra 722.6 22963.59
7 Cucumber Keera 393.39 14875.39
8 Pointed gourd 285.8 13044.42
9 Cauliflower 840 (EA) 20297.81
10 Mango Kesar 821.3 29619.68
Grand Total 9936.39 231671.5
The table shows top ten SKUs having losses. Potatoes, Tomato top the charts.

The serious types of losses identified at the back-end are:
 Dump loss/ wastage
 Dump loss arises when product deterioration or shelf life of some of the SKUs cannot be
extended.
 Some leafy vegetables like Coriander arrived on 25th
June 2014 from Jamalpur Mandi were
affected by wilt, thus whole SKU was dumped off.
 When there is high inventory holding, sometimes products weighing small amount isn’t recorded.
This can create a negative impact on economic loss of the company
 The general procedure for registration of dump amounts is, all products that are discarded are
registered via the item wise code and also the reason behind the discard is registered. The amount
is registered in monetary terms. Only products that are sold by weight are registered by weight.
Table 5.19: Dump value of FFV in May month
Source: Naroda CPC
 The above table represents total dumping loss occurred at CPC during month of May. The
maximum loss occurred in Coriander followed by tomato. When the dump percentage is more
than 3 % then the product is rejected. The amount was reported to be 212901.71 lakhs and
quantity dumped was 12329.2 Kg during May.
Sr No Articles Quantity loss
(Kg)
Amount in Lakhs
1 Sugar baby melon 3793.6 28335.42
2 Potato 1224.3 21626.74
3 Tomato 2774.2 33886.46
4 Capsicum green 362.4 10365.98
5 Mango Safeda 293.3 11315.39
6 Methi Big 280.8 15344.87
7 Coriander 1670.6 50257.2
8 Cauliflower 266 (EA) 4070.63
9 Watermelon Kiran 967.6 8242.46
10 Mango Kesar 696.4 29456.56
Grand Total 12329.2 212901.71

Shrinkage loss
 Shrink in fruits and vegetables takes place due to loss of moisture. This leads to weight loss
and in effect, when product is sold, the weight would be less than what was received, which
would lead to difference in book and physical stock.
 The shrink loss also includes
1. when inventory is high and the product gets deteriorated
2. Theft at CPC
 One box of plum was missing out of one crate and some amount of plum got
missing from another box.
3. Wrong bar coding or item wise no sometimes done by the staff
Table 5.20: Shrinkage Value in FFV in month of May 2014
Sr. No Article Quantity value(Kg) Amount in Lakhs
1 Musk Melon 105.44 2489.53
2 Sugar baby Melon 700.365 6028.77
3 Onion 563.17 9010.69
4 Potato 805.77 14391.63
5 Potato Baby 175.61 3121.19
6 Cucumber Keera 221.69 9542.99
7 Mango Safeda 125.46 4907.24
8 Tomato 852.665 11475.49
9 Banana Robusta 360.071 4654.59
10 Mango Kesar 459.705 15893.38
Grand Total 4369.946 81515.5
Source: Naroda CPC
The table indicates the shrinkage value in fresh fruits and vegetables during May month.
Mango Kesar, potato and tomato are reported to have large shrinkage loss.
 Transits loss
 The more the vegetables travel in miles, the less fresh they become. This means customers
pay for vegetables, which have less initial nutritional value.
 Most of the time, the fresh produce is damaged during transit due to long waiting for loading
and unloading.

 On 28th June, lot of quantity of Tomato got wasted as unloading wasn’t done on time.
Improper arrangement of crates of tomato in trucks also lead to cracking of tomatoes, thus
lead to dumping.
 Due to temperature, long distances and humidity, the exotic vegetables from Bombay vendor
got damaged and had to dump.
 Due to lack of proper ventilated reefer vehicles, vegetables and fruits doesn’t remain fresh.
 Vibration of vehicles lead to cracking or damage to FFVs
Some problems at CPC:
 During grading and sorting, workers mix non-Reliance retail and Reliance retail quantity
( according to quality specification decided by company) and are dump into NRR.
Table 5.21: S & G report of top five SKUs on 08.07.2014
Source: Naroda CPC
The table represents the top SKUs having loss after the sorting and grading. The actual quantity is
sample taken for AQR, and sample is taken by formula as √ n+1.
Lack of proper functioning of cold storage
 One of cold storage couldn’t maintain proper temperature as a result the leafy vegetables got
spoiled and it took more than 2 days to get repaired.
Carelessness by the worker while handling the produce
 Workers were careless about quality specification of FFVs and thus mixed both Non-RR and
RR quantity, thus weight of the product would be different.
Sr.
No
Product Actual
Quantity
(Kg)
RR
Quantity
(Kg)
NRR
(Kg)
Dump
(Kg)
Total
N.R.R &
Dump
Total
% dump
& N.RR
1 Cucumber 22 8 14 0 14 63.o
2 Capsicum
Red
30 14.2 11.8 4 15.8 52.7
3 Capsicum
yellow
30 18.9 8.2 2.9 11.1 37
4 Zucchini
Yellow
2 1.7 0.3 0 0.3 15.0
5 Coriander 152 129.6 0 22.4 22.4 14.7

 Mis-matching and allocation errors of the produce at
CPC
 Indent informed by store doesn’t match the CPC
supply
 Timely accounting of material isn’t done.
 It was observed that date, on which the FFVs were
dispatched, wasn’t mentioned in account.
 Supervisors and staff were not sure which process they had to look after.
Problems at stores:
The major reasons identified for dumping at the retail outlet
 Lack of knowledge on how fruit and vegetables should be handled as they are sensitive to storage
etc.
 Staffs was mixing the not so fresh beans with freshly arrived beans at Reliance Mart
 Lack of timely sorting of fruits and vegetables.
 On 14th
June, when I visited Reliance mart at Iskon, timely sorting of Methi wasn’t done as
result it was not made available to customers during morning.
 Damage caused by customers while picking for the good produce.
 It was observed that the customers pricked the tomatoes and banana while picking the good
ones, thus it had to be dumped.
 Customers used to open the packed package of plums and pluck the few required and leave the
rest.
 Nature of the produce:
 Tomato and leafy vegetables are more prone to be dump compared to other vegetables, as
freshness get reduced in short period.
 Weight reduction due to loss of moisture in fruits and vegetables after certain period of time.
 Problems with product quality, quality that does not meet the retailer’s specifications and
additional trimming of edible parts, such as for pre-cut produce (ex. Cauliflower, Cabbage)

 Mango, papaya, muskmelons are dumped due to stacking one over the other, fruits are spoiled
due to weight exerted by each other.
 Fruits and vegetables are exposed in first rack; – With the results that fruits in the middle or the
bottom of the pile easily gets damaged and must be disposed. Some are covered with paper but
don’t get enough air. (Mango, Pomegranate).
 If a fruit becomes rotten in the pile, the surrounding fruits are more likely to be rejected than if
they are displayed one by one.
 Improper Indenting: What the customers buy depends on the offers of the week, and on the
frame of mind of the customers. As a result, it makes difficult to indent satisfactorily. Lack of
knowledge among the staff regarding ordering.
 Carrots were great in demand by customers but indent wasn’t done as personnel weren’t
aware of customer demand
 Improper handling while arranging and keeping the stock.
 Vegetables like ladies finger, cluster beans are mixed at the rack.
 Unnecessary inventory: excessive storage and delay of products resulting in excessive cost,
overstocking and over handling by both staff and customers and damage to items on the bottom
from the accumulated weight.
 Products, which aren’t sold in morning or because they do not meet the required specification,
they have to be marked down for sale. Such products are channelled to dump. This type of loss
can represent a significant economic loss to business even though it reflects an efficient use of
the product.

SWOT ANALYSIS
SWOT analysis shows that the “strengths”, “opportunities” “weaknesses‟ and “threats‟ of the
company
Table 5.21: SWOT Analysis
Strength
1. Reliance is the first into enter into this organized sector of
vegetables and fruits. According to them its intentions to
have100% farm fresh foods in their new retail stores. It now has
Indian retail chain with 900+ stores in 80 cities in India
2. Over 60 per cent of the floor space has been dedicated to fresh
fruits and vegetables, the rest to other food products like staples,
spices, bakery, etc.
3. Huge promotional activities undertaken to ensure enough
footfalls
4. It owns various private label brands-Reliance select
5. It has strong distribution network of 1600 channels in villages
where they procure vegetables and fruits.
6. Strong financial back up of the parent company
7. High brand equity
8. Ambience of stores like traditional bazaars but provide
customer satisfaction
9. Customer trusts the reliance product’s for quality. They don’t
consider the product to be adulterated.
Weakness
1. Product variety is available but more SKUs are not present due to
inefficient back end infrastructure.
2. Poor inventory control at certain locations is a concern
3. Fruits and vegetables doesn’t remain fresh till the end of day
4. Lack of supply chain like other big players
5. Staff takes more time in billing process
6. Staff need more qualification

Opportunity
1.Sourcing directly from farmers; no middlemen could earn more
profit as number of farmers will increase five times in next 5 years
2. Leveraging on brand name and entering into Reliance saloon
3. Large potential to reduce operation cost in cities using strong
supply chain.
4. Early entry in Indian entry
5. Global expansion
6. Evolving consumer perception
7. Targeting area more affected by development
Threats
1. Strong competition globally from Carrefour, Metro A.G., Tesco.
Wall mart is biggest competitor when it comes to sourcing/
backward integration.
2. Operating cost are too high
3. Fast turnover of inventory
4. Fairly high business model
5. Burgeoning retail estate prices due to high rental
6. Threats from domestic supermarkets like star bazaar and big
bazaar
7. Model is featured to have a faster turnover of inventory.
8. Government policies like complex sales and excise policies

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