A SUMMER TRAINING REPORT

ON
CATCHMENT ANALYSIS AND CUSTOMER
SATISFACTION STUDY OF SHOPPERS STOP

ACKNOWLEDGEMENT

I am highly indebted , for his generous support and help, which encouraged me to do the
work. I am indebted to him, for his personal and professional interest in moulding me to
my present personality.
I am also thankful to the staff members of Shoppers Stop for their valuable help.
This acknowledgement would be incomplete without a word of thanks to my friends for
extending their co-operation and all the respondents of my survey.

INDEX
Introduction...3
Objectives of the study..4
Industry Profile..5
Company Profile.8
SWOT.15
Research Methodology (Catchment Analysis)19
Research Methodology (Customer Satisfaction Study)......19
Findings and Interpretation(Catchment Analysis).....22
Finding and Interpretation(Customer Satisfaction Study)....30
Recommendations...42
Bibliography.43

Introduction
Catchment Analysis :
Catchment Analysis is analyzing the areas and the customer profiles from attractive
segments. Catchment analysis involves studying the demographics like lifestyles, social
status, income levels, age, genders etc. This helps the organization to focus most of their
marketing efforts to these segments or catchments.
Customers Satisfaction Study:
Customer Satisfaction Study helps in knowing the attitude of the customer towards the
products/service of the organization. Customer Satisfaction is achieved when the
company manages to reach the customers expectation and the customer get value for
money. By requesting customers to fill up questionnaires, the organization can identify if
it is reaching the customers expectations and how the customer perceives its
services/products.

Objectives of the Study:

The main objective of the study is to

Identify the attractive segments/Catchments of Shoppers Stop.

Study in detail those segments/Catchments.

Identify the extent to which Shoppers Stop reaches its customers satisfaction
level on various parameters.

Industry Profile:
With a rapidly growing middle class and Indian consumer being the youngest in the
world, the scene couldn't have been any brighter than this for the retail sector which is in
a buoyant mood. Total private consumer spending has touched about Rs 18,90,619 crore
with the organized retail sector getting Rs 15,96,802 crore of this spend. The forecast is
the consumer spending will cross Rs 1,00,000 crore in another three years.
Another factor which has fuelled the rapid growth of the retail sector is the growing
income as seen in a study by the National Council of Applied Economic Research
(NCAER) which stated that the very rich with annual income of over Rs 2,15,000 have
increased to 6.2 million households while the consuming class with annual income in the
range of Rs 45,000 to Rs 215,000 has grown from a million to 90.9 million households.
All these developments have led to the rapid growth of the retail sector in the country
which has 15 million retailers, most of them owning small mom and pop outlets though
large corporates like Reliance, ITC, Tata, Pantaloon, Jubilant Group and Raheja too are
investing huge capital in this sector.
Coupled with this, several leading Indian groups are going for tie-ups with world's
leading retailers like Wal-Mart, Carrefour and Metro who too are equally keen on coming
to this country.
As Harve Clec'h, Managing Director, Carrefour India and Gerard Freiszmuth, General
Manager, Carrefour India Project, said of the scope for retail in India "there is a lot of
opportunity in this sector for us since demand of the potential consumers are not being
met under the existing facilities."
The visit of world's top retailers to this country and American retailer Wal-Mart's tie-up
with leading Indian company, Bharti, are indicators of the shape that the retail sector
would be taking in the coming years.
Clearly, Indian retail scene is undergoing a rapid change. It will see an investment of over
Rs 20,000 crore by 2010 in quality retail space across the country. But, what is interesting
is that most of the growth in the retail space is estimated to come from more than 1,000
tier-II towns and major rural hubs.
With the annual growth of the organized retail sector expected to be around 36 per cent,
one of the major challenges is investment to enable it to maintain the current growth
momentum over the next five years. A positive indication in this direction came with top

corporate like shoppers stop, future group etc. who are into retail business announcing
grandiose plans for investment.
Currently the Indian retail market is estimated at US$300 billion, and almost half of this
is at present in rural India. With nearly 55 per cent of the total retail market being in rural
India, this is a tremendous growth sector. Keeping this in view, companies like DCM,
Godrej and ITC have begun focusing in the rural areas. DCM Hariyali Kisan Bazaars,
Godrej Aadhars and ITC Choupal Sagar have branched off into the rural areas as also
Tata Kisan Sansars and Naya Yug Bazaars.
The Hariyali Kisaan Bazaar is a pioneering micro level effort, which is creating a farreaching positive impact in bringing a qualitative change and revolutionizing the farming
sector in the country. Currently the chain is successfully running its business through 33
stores in five rural locations in North India. A typical centre caters to agricultural land of
about 50,000 to 70,000 acres and impacts on nearly 15,000 farmers across India.
Though government has put on hold Foreign Direct Investment (FDI) in the retail sector,
observers feel that the retailers would devise their own methods to bring in the necessary
funds. According to available figures on the growth of organized retail, the three years
from 2004 to 2006 saw immense growth from Rs 28,000 crore in 2004 to Rs 35,600 crore
in 2005 and Rs 47,500 crore in 2006.
There was still further good news for the retail sector as according to data brought out by
Reserve Bank of India (RBI Bulletin, January 2008), sales of private limited companies
in the wholesale and retail trade registered a growth of 11.8 per cent during 2005-06.
This of course is no where near growth rates of companies like Pantaloons and Trent at
72.3 per cent and 47.7 per cent respectively during this same period. The sales of
Pantaloons during 2006-07 jumped by around 90 per cent, while that of another leading
retailer Shoppers' Stop rose by 40 per cent.
"The top line of these companies will see huge highs and the sales volumes will
constantly increase as all of them are on an expansion mode," said Gibson G. Vedamani,
Chief Executive Officer, Retailers Association of India.
With growth also comes its problems and though organized retail maybe growing rapidly,
it is also now faced with the problem of fraud and shop lifting. It is estimated that loss
from shrinkage accounts for nearly three to four per cent of an Indian chain's turnover,
nearly double of what is faced by their counterparts in the West and this means a loss of
about Rs 9,000 crore.
So, it is little wonder that those in the business are keen on investing on shrinkage control
mechanisms, such as installing RFIDS, sensors, IT solutions and training employees.
Internal shrinkages are also on the rise. "Since employees know the business process,
they tend to become more adventurous. This leads to frauds such as cashier fraud,
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stealing products or cutting manual bills which are not recorded. Shrinkage has an
exponential effect on the bottom-line since the inventory costs are already accounted for
in the books," said IBM India business solutions executive (Retail) Sridhar Harihara
Subramanian.
Faced by these problems, retail chains have now begun investing on employee training,
to increase their emotional attachment and ownership with the store. "We share with them
inventory figures about a particular category and the loss from any shrinkage. The idea is
to develop internal peer pressure among the employees," Ebony Retail Holdings CEO
Lalit Kumar said with the company's annual budget on shrinkage control now being Rs
50 lakh.
Another major problem being faced by the retailer is the practice of Shop-dropping where a local trader poses as customers and drop pamphlets or other promotional matter
in the retailer's merchandise. This may not lead to loss of inventory but the chain looses
out to valuable advertising revenue.

Company Profile:
Shoppers Stop was incorporated in 1991 by the K. Raheja Corp group of companies, one
of the largest players in the country in the real estate development and hotel businesses.
In 1991, when retail in India was about shelf space, merchandise and prices, Shoppers
Stop redefined every aspect of the shopping experience and offered the Indian consumer
an international shopping experience.
Shoppers Stop catered to the aspirational needs and lifestyle requirements of the Indian
consumers of today who were well-traveled, well-read and a true global citizen. During
the decade of the 90s when air-conditioning, emphasis on lighting and superior customer
service were considered a luxury, Shoppers Stop incorporated them as hygiene factors.
Shoppers Stop has many Firsts to its credits such as:
First to create a store brand.

 First to create a retail loyalty program.

First to open its stores on Sundays.
First to launch a co-branded credit card in retail in the country.
First retailers to go to B-schools for recruiting fresh talent.
First Indian entry in the prestigious New York Art Directors Guild Awards for best
campaign.
First to implement the state of the art retail ERP (enterprise resource planning)
solution JDA, JDA is the software name which is used for inventory and
merchandise management.
VISION
To be a Global Retailer in India and Maintain No.1 position in the Indian Market in the
Department Store Category.
MISSION
Shoppers Stops Mission Statement
"NOTHING BUT THE BEST"
VALUES OF SHOPPERS STOP
We will not take what is not ours.
The obligation to dissent.
We will have an environment conducive to openness.
We will have an environment for innovation.
We will have an environment for development.
We will have the willingness to apologize and forgive.

 We will respect our customers rights.

We will create an environment of trust.
We will be fair.
We will be socially responsible.

POSITIONING
Shoppers Stop is positioned as a family store delivering a complete shopping experience
defined by its mission, vision and values.
Directors:
In accordance with the provision of the Companies Act, 1956 and Articles of Association
of the Company, Mr. B.S. Nagesh and Mr. Shahzaad Dalal, Directors of the Company,
retire by rotation at the ensuing Annual General Meeting and being eligible, offer
themselves
for
re-appointment.
Mr. Govind Shrikhande, who has been appointed as an Executive Director and CEO of
the Company for a period of 3 years w.e.f. July 29, 2006; is proposed to be re-appointed
as an Executive Director and CEO of the Company for further period of three years w.e.f.
July 29, 2009; subject to necessary approval of the Shareholders of the Company.
Mr. Nirvik Singh, was appointed as an Additional Director on the Board of the Company
with effect from 16 June, 2008. The Company has received a notice in writing from a
member of the Company under Section 257 of the Companies Act, 1956 signifying his
intention to propose tie appointment of Mr. Nirvik Singh, as a Director of the Company.
A brief resume, expertise and details of other directorship and committee membership
thereof of these directors are given in the explanatory statement annexed to the Notice
convening the Eleventh Annual General Meeting
Customer Profile
Shoppers Stops core customers represent a strong SEC A skew. They fall between the
age group of 16 years to 35 years, the majority of them being families and young couples
with a monthly household income above Rs. 20000 and an annual spend of Rs.15000. A

large number of Non - Resident Indians visit the shop for ethnic clothes in the
international environment they are accustomed to.
Range of merchandise
The stores offer a complete range of apparel and lifestyle accessories for the entire
family. From apparel brands like Provogue, Color Plus, Arrow, Levis, Scullers, Zodiac to
cosmetic brands like Lakme, Chambor, Le Teint Ricci etc., Shoppers Stop caters to every
lifestyle need. Shoppers' Stop retails its own line of clothing namely Stop, Life , Kashish,
Vettorio Fratini and DIY. The merchandise at Shoppers Stop is sold at a quality and price
assurance
backed
by
its
guarantee
stamp
on
every
bill.
Their
motto:
We
are
responsible
for
the
goods
we
sell.
Customer Rewards The First Citizen
Shoppers Stops customer loyalty program is called The First Citizen. The program
offers its members an opportunity to collect points and avail of innumerable special
benefits. Currently, Shoppers Stop has a database of over 12 lakh members who
contribute to nearly 50% of the total sales of Shoppers Stop.
International Affiliations
Shoppers Stop is the only retailer from India to become a member of the prestigious
Intercontinental Group of Departmental Stores (IGDS). The IGDS consists of 29
experienced retailers from all over the world, which include established stores like
Selfridges (England), Karstadt (Germany), Shanghai No. 1 (China), Matahari (Indonesia),
Takashimaya (Japan), C K Tang (Singapore), Manor (Switzerland) and Lamcy Plaza
(Dubai). This membership is restricted to one member organization per country/region.
Acquisitions
The Organization, in 2000, along with ICICI ventures also acquired the reputed
bookstore, Crossword, which offers the widest range of books along with CD-ROM,
music, stationery and toys. Services like Dial-a-book, Fax-a-book and Email-a-book
enable customers to shop
from
their
homes.
Crossword currently has
18 Stores.
The IT Backbone
Realizing the role of IT
way back in 1991,
Shoppers
Stop
was
among the first few
retailers to use scanners

10

and barcodes and completely computerize its operations. Today it is one of the few stores
in India to have retail ERP in place, which is now being integrated with Oracle Financials
and the Arthur Planning System, the best retail planning system in the world. With the
help of the ERP, they are able to replicate stores, open new stores faster and get
information about merchandise and customers online, which reduces the turnaround time
in taking quick decision.
Supply Chain Management
Understanding the importance of distribution and logistics in ensuring the merchandise is
available on the shop floors, has led Shoppers Stop to streamline its supply chain. The
company has developed process manuals for each part of the logistics chain. These
modules include vendor management, purchase order management, stock receiving
systems, purchase verification and inventory buildup, generation and fixing of price and
store tags, dispatch of stocks to the retail floor and forwarding of bills for payment.
Future Plans
Shoppers Stop aims to position itself as a global retailer. The company intends to bring
the worlds best retail technology, retail practices and sales to India. Currently, they are
adding 4 to 5 new stores every year.
ACHIEVEMENTS OF SHOPPERS STOP
AWARDS

AND

RECOGNITION:

shoppers stop has been conferred with the following awards and recognitions during the
following years.
In 1994, First Citizen Club loyalty card launched.
In 1999, Implemented JDA Retail ERP (a global leader in retail ERP packages).
In 2000, Placed equity with external investors to raise Rs 600 mn
Acquired Crossword, one of India's leading book retailing chain, from India
Book House in partnership with ICICI Trusteeship Services Limited (A/c ICICI
Emerging Sectors Fund).
In 2001, Implemented Warehousing Module of JDA, Auto Replenishment and
Auto Purchase Order system and business to business connectivity and Profit
Linked Reward System (PLRS) introduced (for all the employees).

11

 In 2003, Received various industry awards from CMAI (including Best Retailer
of the Year) and from Nasscom (Best IT Practice in Retail Category) and also
Signed Austin Reed license for men's outerwear for India exclusively.
In 2004 taking total retail area to 752,848 sq ft Received Super brand status for
2003 and 2004 Received Images Retail award for the most favored retail
destination of the year - September, 2004 Received the Organization With
Innovative HR Practices award at the HR Excellence Awards organized by MidDay, Big Break & Daks - November 2004.
Received Top retailer 2004 India Bronze award given by Retail
Shoppers stop got the 'Retail Destination of the Year' at the Image Fashion Forum
In the year 2007 shoppers stop got the 'Most Admired Retailer of the Year' for
technology applications at Image Retail Award.
Shopper stop got the 'Advertisement Campaign of the year' CMAI APEX
Awards; 'Departmental Store of the year' at Star Retailer Award.
Shoppers stop got the Emerging Market Retailer of the Year Award, at World
Retail Congress, Barcelona, Spain.
In 2007 shoppers stop Signed a 50:50 Joint Venture with the Nuance Group for
Airport Retailing Signed an MOU with the Home Retail Group of UK to enter
into a franchise arrangement for the Argos formats of catalogue & internet
retailing
Shoppers stop Awarded by Images retailer of India in 2008.

12

SWOT ANALYSIS OF SHOPPERS STOP

STRENGTHS:
* First Citizens:Shoppers stop First citizen members have been a driving force behind the growth of the
Company. Company had over 12,00,000 First Citizen members as on 30th sep, 2008.
First Citizens will continue to drive the companys growth by increased average
expenditure in their stores which will be aided by targeted promotional activities. first
citizen contributes more than 50% in the total sale of the company.
* Strong focus on Systems & Processes:Shoppers stop have a strong focus on systems and processes. shoppers stop have been
able to capture its learnings over the years and use them to create Standard Operating
Procedures ('SOPS') for each of its activities, right from planning and setting up of, new
stores to their day to day operations. Companys SOPS are available on its Intranet,
which helps their employees to access them whenever required helping company achieve
consistency in their decision making process across the chain. company also have a
Manual of Authority, outlining the framework of financial and legal decision making
authority at all levels in the Company, right up to the Customer Care Associate & MD
and
the
Customer
Care
Associate
&
CEO.
* Strong distribution and logistics network and supply chain:Shoppers stop have created a strong distribution and logistics network, with their four
Distribution Centers covering more than 300,000 square feet handling over
400,000
SKUs
per
year,
and
working
247.
* Enhancing the human capital:Shoppers stop periodically assess their CCAs across all levels through assessment centers
to identify competency gaps and use development inputs (i.e. training, job rotation etc.)
to bridge them. Shoppers stop benchmarked their compensation and benefits through
consultants, with the best in the industry to pay their associates accordingly.
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* Strong understanding of the real estate business:Shoppers stop benefit from their Promoters' association with the real estate business and
their relationships with developers, which have helped shoppers stop to acquire preferred
properties at competitive rates. And low rentals due to long lease contracts.
* Shopping Experience:Shoppers stop pioneered the departmental store format in the Indian market when the
Indian consumer was deprived of choice. Customers were drawn by the shopping
experience. This is the differentiation that shoppers stop continues to bank on. Price is not
essentially a differentiator for the shoppers stop, shopping experience is. Company
imparts special training to its employees to ensure that service is not compromised on.
With continued focus on service Company's stores continue to post increasing footfalls
and conversion rates despite the mushrooming of shopping malls, hypermarkets and
specialty
stores.
* Management Strength:Shoppers stop has a strong and well-established management team, headed by B.S.
Nagesh, Managing Director. I believe that the CEOs of each business under the guidance
of the MD will be the key to successful execution and expansion, and strong business
growth.
*
WEAKNESS

(Risks

and

Concerns):

* Execution: - (the act of accomplishing the aim)

I believe the key risk to the companys growth is execution risk. Shoppers stop has a
strong execution team and I believe it has the capability to execute varied retail formats.
* Employee retention:Modern retail is a new industry in India, which is only now gaining growth momentum
because of the entry of new companies. Competition for reasonably experienced
personnel has led to poaching between retailers. Shoppers stop has lost some
management personnel and tried to stem the rise of attrition at the front end. I think that
Company believes that this problem will persist until the industry reaches a steady
growth
phase.
* Delay in store delivery:Majority of the new stores planned are in malls and any delays in the construction of the
malls
will
delay
the
shoppers
stops
retail
expansion
plan.
* High retail lease rentals:Rent is one of the largest components in a retail business' fixed costs, and the case is no
different for the Company. Strong economic growth in the past three years in India has
led to a boom in real estate prices and with it, an increase in retail rentals.

14

* Store renovations:In its constant attempt to deliver 'Nothing, But the Best' to its customers y shoppers stop
needs to renovate its older stores. These renovations have a substantial impact on cash
flows. Renovated stores also go through a gestation cycle before they ramp up to original
performance
levels.
* Government levies:Retail is currently not viewed as an industry in India. Hence there are certain levies on
the business which are proving to be a very large burden as there are no modes for the
industry to recover or pass on these levies. Chief amongst these levies is Service Tax on
lease
rentals,
etc.

OPPORTUNITIES:

* Geographical reach:Shoppers stop continues to increase its Pan-India footprint. The Company has plans to
increase the number of departmental stores to 41 in the next 3 years. In addition the
company will also continue to expand its various other formats.
* Hypercity:An entry into mixed retail Company has entered the hypermarket segment, which is a
high growth segment by acquiring a 19% stake in Hypercity. I believe that the scope for
hypermarkets in India is immense. The store run by Hypercity has shown very impressive
performance
in
the
year
gone
by.

* Format diversification: Shoppers stop, in its constant endeavor to capture wallet share, has diversified into
multiple formats viz. Home Stop which retails hard and soft furnishings, Crossword for
books, music and stationery, airport retailing by tying up with The Naance Group AG of
Switzerland, and F&B formats comprising Brio and Desi Cafe, and Arcelia, which retails
high
end
non
apparel
arid
accessories
for
ladies.
* Preferred partner for foreign players:Shoppers stop believes that by virtue of its presence across all lifestyle categories in the
departmental format, it's strong brand value and its presence in the books and music
segment, it is best placed to bring in international brands into the country, there by
enriching the product bouquet for its customers and in turn increasing opportunities to
product
diversification
and
profit
enhancement.
THREATS:-

15

* Threat of new entrants:With India becoming an attractive retail market and the gradual increase in foreign
participation in the sector, Company expects many new entrants thus sharpening
competition.
* Competitive rivalry in the industry:There is intense rivalry among leading national retailers for new locations and quality
real
estate.
* Economic slowdown:Retail is the 'last mile' and the impact of economic slowdown will be seeing a direct
manifestation in lowered consumer spend.
Research Methodology:
Catchment Analysis:
For Catchment analysis I relied on my customer satisfaction survey to know the places
from where Shoppers Stop gets most of its customers. I collected data from a few areas
and
intend
to
cover
more
areas.
I collected data about whether the area is a residential area or a commercial area or a
combination of both. If it was a commercial area, what kind of offices do those places
include. If it was a residential area what is the social status of people staying in those
localities. And also the contact details of secretaries or managers of those localities. They
can be contacted by Shoppers Stop for carrying out promotional activities in those
localities
about
any
offers
or
sale.
Then by inquiring about the flat rates in those areas I came to a rough estimate of the
social class of people of that area. (If possible I inquire about their work details. But
getting this kind of information if tough as no one wants to share these kinds of
information). I then collected data about competition for Shoppers Stop in that particular
area and also other data like restaurants and other entertainment sources.
Customer Satisfaction Survey:
For customer satisfaction survey, I made a tabular questioner asking the patrons to fill in
the option they thought suited the question best according to them. The patrons were
asked about their opinions on parameters like on parameters like layout, ambiance, brand
variety, product variety, product quality, price, signage, location, ease of reaching the
store, service by employees, billing etc.

16

Questionnaire:
Age Group
Below 18 yrs 18-25 yrs 25-35yrs 35-45 yrs Above 45 yrs
How would you rate your shopping experience at Shoppers Stop?
Excellent Very Good

good

Average

Poor

How would you rate the quality of products?

Excellent Very Good

Good

Average

Poor

How would you rate the product display?

Excellent Very Good

Good

Average

Poor

How would you rate the variety of product range?

Excellent Very Good

Good

Average

Poor

How would you rate the variety of brands available?

Excellent Very Good

Good

Average

Poor

How would you rate the pricing?

Affordable Decent Average Expensive Very Expensive
How would you rate the shopping convenience?

17

(Signage, space to move, ease of finding what you need etc)

Excellent Very Good

Good

Average

Poor

How would you rate the ambience?

( Lighting, music, Environment, Cleanliness)
Excellent Very Good

Good

Average

Poor

How would you rate the employee service?

(Courteous, helpful, effective)
Excellent Very Good

Good

Average

Poor

How would you rate the billing process?

Excellent Very Good

Good

Average

Poor

Location:

Summary:
The survey shows that most of the customers are below the age of 35 and a small percent
of people are middle aged. Shoppers Stop manages to score well in parameter like
products variety, product quality, brand variety, ambience, employee service, product
merchandising, shopping convenience and overall experience with about 80% of the
customers showing more than satisfactory delivery by shoppers stop. But Shoppers Stop
scores less in pricing and billing process. During evenings in the weekdays and
weekends, the number of cashiers is inadequate to ensure smooth billing. This leads to
delay and frustration for waiting customers.

18

RECCOMENDATIONS:

During weekdays, Shoppers Stop can have fewer cashiers in the mornings and
afternoons and more cashiers in the evenings

During weekends, in the peak hours, and extra billing counter can be set up to
handle long queues.

Shoppers Stop can bring up at least one expensive brand to cater to

customers with lower budgets.

Shoppers Stop can have a short duration of discount sales exclusively for First
Citizen members to encourage more customers to enroll for first citizen
membership.

BIBLIOGRAPGY:
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Marketing management Philip Kotler

Grey Armstrong
Services Marketing

- Valarie A. Zeithaml
Mary Jo Bitner (Tata McGraw Hill)

Marketing Research

- Aditya Pandit
Charles Brown

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