PROJECT

DRIVING THE LOYALTY SALES PERCENTAGE OF RELIANCE FRESH STORE, VAISHALI NAGAR,JAIPUR..

SUBMITTED BY: AKASH SHARMA AJAY SINGH SHEKHAWAT BATCH 2010-12

SUBMITTED TO:

CHAPTER- 1

INTRODUCTION

Retailing consists of the sale of goods or merchandise, from a fixed location such as a department store or kiosk, in small or individual lots for direct consumption by the purchaser. Retailing may include subordinated services, such as delivery. Purchasers may be individuals or businesses. In commerce, a retailer buys goods or products in large quantities from manufacturers or importers, either directly or through a wholesaler, and then sells smaller quantities to the end-user. PROJECT INTRODUCTION The project was done at Reliance Fresh convenience store of Reliance Retail situated at Vaishali nagar. This project is all about to increase the Loyalty Sales Percentage of the individual stores. What is Loyalty? The degree to which customers are predisposed to stay with one company and resist competitive offers.

Building Customer Loyalty

1. SERVICE NETWORK:The mantra for marketing professionals is service,

service and more service! Thats right! One of the best ways of ensuring your customers keep coming back to you is providing impeccable service. This includes everything from service at the point of sale to after-sales service, which builds a lasting relationship with the customer. Most manufacturers of white goods understand relationship marketing like no one else. The peculiarity lies in the product itself, where it might need to be serviced long after it is bought. Moreover, the purchase might have taken place somewhere different from where the service is required.

2. QUALITY CONTROL: Another good way of assuring customers value the quality of your product is to get an outside agency or someone else to endorse the results. For instance, Colgate Toothpaste continually reminds the customer that it is endorsed by IDA, the Indian Dental Association and it is the brand trusted by most dentists. HLL gets customers to talk about their Ponds Age Miracle range of cosmetics and Dove soaps in their television ads, to endorse the quality of their products. That is also the psyche behind prompting a customer to try out the product. 3. CONSTANT INNOVATION:Once a customer, always a customer, is no longer true in these days of fluctuating brand usage. Customers now have more choices than before and are more willing to try out new brands. This fickle-minded buying warrants a constant focus on the changing mindset of the customer. The brand too has to change with customer tastes. Nestle India does it best with its brand of Maggi food products

4. DIVERSIFICATION INTO SIMILAR PRODUCT LINES:If a customer feels that Dove Soap is the best for her skin, why not make her think the same way about shampoos as well? Thats exactly why the brand name has now been extended to shampoos in the Indian market. Stretch the loyalty and benefits associated with a brand to include other similar products. 5. STRONG DISTRIBUTION CHAINS: If I want to buy a product, it must simply be available. For fast moving consumer items, it means availability at the nearest grocer. From personal experience, I can tell you how important this is. I like Nestles Munch chocolate a lot, but many a time I end up coming home with a Cadburys Perk in hand, due to unavailability of the other brand. Perk tastes just as good, and pretty soon I ended up asking for Perk at the local grocery shop instead of Munch. This shows how just availability or lack of it can affect the customers brand choices forever. 6. REINFORCE THE DECISION:Lastly, after people have tried your product, tell them that they have made the right decision. Customer loyalty towards your brand can give you the advantage of decreased cost of advertising. You can also increase the price of your brand to capitalize on the same. So, go ahead and take the plunge into the world of brand loyalty!

Benefits Customer loyalty towards your brand can give you the advantage of decreased cost of advertising. You can also increase the price of your brand to capitalize on the same. Loyalty Sales % = Sales through the Loyalty Card X 100 Total Sales

Customer Loyalty programs need to stay fresh, be easy to administer, and tightly integrate with the central price file and all the customer touch points. Successful Loyalty programs pinpoint value to a specific group of consumers. The continuous change in programs keeps consumers engaged and avoids the attitude of entitlement. The Retalix customer loyalty application suite, however, is not your run-of-the-mill solution. It is comprehensive, easy to administer, and effective. Retalix Loyalty is a real time, online, centralized system that manages the Loyalty and Promotional marketing campaigns for Grocery and Convenience Store Retailers. Coupled with the Retalix 1-to-1 Targeted Marketing Analysis tool, a retailer can easily reward customers according to their specific taste and loyalty level via a multitude of reward programs to keep it fresh and fun. Moreover, through a tight integration with the Pricebook, POS and Fuel Pumps, electronic rewards can be fulfilled for the consumer right at their purchase location.

Retalix Loyalty includes: Integrated POS and Pump interface to collect data, print Loyalty program information on the receipt, display messages to the cashier and customer, discount items, and redeem e-gift certificates, tender credits, and loyalty points Net-based online communications architecture Multiple set of basic programs (Charity, Continuity, Sweepstakes, e-Coupons, Points) Tiered pricing rewards (electronic discounts) including fuel, according to loyalty levels Reports to measure loyalty not only by gross spending but also by gross profit Reports to measure program participation by store and chain Net-based Centralized Management System Retalix 1-to-1, Targeted Marketing

Why the card is not being used? Customer forget their card. Customer dont know the benefits of card. Quality of temporary card is very poor. Cashier forget to ask about the card. Many unwanted details are to be filled in form by customer.

Support Functions: The entire operation is possible with the help of a support team. This support team consists of the following: Human Relation-Involves itself in recruitment, training and welfare apart from their regular activities Good Receiving-This department is responsible not just for the receipt of goods but also checking for their conformity and returns goods to the suppliers as need arises. Maintenance-The entire stores furniture and fixtures are taken care of by the maintenance team Accounts-the department, which receives all the cash, charge slips and other types of tenders; keeps a tag on the local store expenditure and also monitors any deviation in the transactions. Housekeeping- Mostly its an outsourced agency, which does the work. They keep the premises clean and tidy at all levels. Security-They are responsible for safeguarding men and material of the organization. VM-This department maintains the displays and the signage across the stores. CSD-Otherwise known as the customer service desk takes care of the customer complaints and issuance of merchandise credit and taking care of the loyalty programmed. IT-The IT department takes care of all the Networking, data maintenance and upkeep of all the tills.

Retail pricing The pricing technique used by most retailers is cost-plus pricing. This involves adding a markup amount (or percentage) to the retailers cost. Another common technique is suggested retail pricing. This simply involves charging the amount suggested by the manufacturer and usually printed on the product by the manufacturer.

Top Retailer Worldwide

Rank 1 2 3 4 5 Retailer Wal-Mart Stores, Inc. Carrefour Group The Kroger Co. The Home Depot, Inc. Metro Home Country U.S.A. France U.S.A. U.S.A. Germany

Reliance Fresh
Reliance Industries launched its first retail format called Reliance Fresh in Hyderabad. Spread over 2,000-5,000 sq ft, 11 such Reliance Fresh neighborhood convenience stores were come up in the city. These stores sell fresh fruit and vegetables besides staples (dal, atta, rice) as well the companys in-house brand Reliance Select and Reliance The retail initiative of Reliance will be without a parallel in size and spread and make India proud. Ensuring better returns to Indian farmers and manufacturers and greater value for the Indian consumer, both in quality and quantity, will be an integral feature of
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this project. By creating value at all levels, we will actively endeavor to contribute to India's growth. The project will boast of a seamless supply chain infrastructure, unprecedented even by world standards. Through multiple formats and a wide range of categories, Reliance is aiming to touch almost every Indian customer and supplier. . Point of Sale Software System Retalix StoreLine is an open-standards, fully integrated and crossfunctional Point of Sale (POS) and store management software system. Its uniqueness is in the functionality, world-wide install base, and hardware independence. Multi-Concept Functionality that delivers a fully integrated POS solution to meet all of your business needs Open by Design supports industry standards and is hardware independent plus integration with other third-party retail applications is straightforward, affordable and low risk Advanced Promotion Features enable a single point of update for pricing and promotions across all retail formats Graphical, Easy to Use flexible intuitive user interface, touch-screen capabilities and even graphical customer screens, means that cashier training is minimal and customer interaction is effortless Quick Service Deli, provides a powerful method of managing freshmade sandwiches and deli items Fuel provides full support for operating an onsite fuel station, supporting a full range of fuel station and supermarket services

Retalix BackOffice is tightly integrated with Retalix StoreLine, and offers POS item management and reporting, DSD receiving, label and sign printing, handheld RF communications, host communications and in-store ordering Retalix PocketOffice is a mobile platform that enables users to manage store operations anywhere in the store, taking the application to the business decision point, while on the sales floor or receiving dock. Retalix StoreLine is installed in more than 250,000 POS terminals worldwide, and is the selected POS solution of top-tier retailers such as Tesco, Publix, Sainsbury's, Woolworths Australia, Delhaize Group, Hy-Vee, and the A.S. Watson Group.

Reliance Fresh Loyalty Programme

1. What is Loyalty Membership?

Loyalty Membership is a program devised by Reliance Industries Limited for Reliance Fresh to retain the customers visiting their stores. It is a program by which Reliance Fresh store issues a Loyalty Membership Card to its customers to encourage them to shop at the store regularly. Each time they buy something they collect points which will allow them to redeem cash vouchers to shop at store in future. Followings are the features of the program: An electronic method of identifying customer purchases and translating that information to reward customers based on their shopping habits. There is a reward point system by which customers receive reward points on every purchase made at the store.

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 For every purchase of Hundred Rupees customer will receive One reward point. Customer should accumulate minimum of 25 points to get a reward voucher by which he can make purchase at the store equivalent to Rupees 25. Customers can also retain these points and receive reward voucher whenever they want. Members will also receive accidental insurance of Rupees 50,000 under this program. Customer will be issued a permanent membership card after 180 days of issuing of temporary card.

2. How Loyalty Membership Program benefit Retailers? The program data help retailers to adjust their product assortment to customer demands. Retailers remove or cut back slow-moving items and devote more shelf space to the products that program members buy. Identify their most loyal customers. Learn more about their best customers buying habits. Offer the products and services according to their best customers demand.

3. How do Loyalty-Membership Program works?

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To enroll, customers typically complete an application form asking for their Name, address, gender, phone number, e-mail address, income etc. Each time cardholders make a purchase, the store scans their membership card, tracks the sale and converts this data into useful information.

Loyalty Membership programs give customers points that accrue with their purchases and can be redeemed for rewards. Cardholders receive their discounts by presenting their card at the checkout or by redeeming targeted coupons.

4. How can food retailers help consumers and Manage Operations with the data they collect? Analyze shopping habits, refine marketing programs and fine-tune the product mix at the chain or individual store level. Stores use data gleaned from loyalty-marketing programs to: Identify the promotions that appeal most to various customer groups, e.g., discounts or rebates for price-conscious shoppers; home delivery services for busy shoppers. Reduce the shelf space devoted to slow-moving items in order to stock the products that customers prefer. Reveal when products were sold and whether they were sold on or off promotion, and the profit margin on each sale. Improve speed-to-shelf and decrease out-of-stocks.

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 Determine how product deletions affect their best customers, and take steps to keep those customers from taking their business elsewhere.

5. What are the advantages of this Loyalty

Program for customers?

Following are the advantages of Loyalty Program: Loyalty Program gives customers the sense that the retailer values them personally and respects them. This program has an inbuilt system of giving discount over the competitive prices of the goods, if compared from general retailers. Besides this it also offers an accidental insurance of rupees 50,000. 6. How we can make Loyalty Program more effective? We can make it effective by introducing various types of schemes which can attract customers. We can issue prepaid cards in different denominations to our customers and provide additional discounts and offers in addition to our normal reward point system. We can also categories the cards as Platinum, Gold and Silver based on purchasing capacity/trend of different segments of customers. The advantages can be increased with the upgraded membership. Card can be made attractive by issuing a plastic or a laminated card in place of the present paper card so that it can be retained for a long time. Increase level of personalized service/interactive approach with the customers. Through interaction and personalize service the front line

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staff should ensure to make the customers feel that they are the valued clients. Cashier should request and enlighten the customers to use their cards. Regular announcement should be made to encourage customers to use their loyalty cards to redeem reward points. There can be additional rewards depending on the frequency of usage of card or can be based on their visit to the store. The Loyalty Program form can be bilingual and should be of one page so that customers find it easy to fill. The form at present is very lengthy and it becomes irritating for the customer when too much information is being asked. Therefore, it is suggested that the form should be made simple and some irrelevant questions, if any, may be removed. If need be in order to facilitate the customers, a separate person may be assigned the task for filling up the forms.

Customers need instant answers to their queries. So store staff can be trained about this Loyalty Program so that they can also assist customers.

The FDM should ensure optimum utilization of available manpower. 7. Can Loyalty be bought? Yes, it can be bought by winning the faithfulness of the customers by giving them quality services without interruption. Meeting the changing expectations of the customers will help strengthen a lasting relationship and ensure that the customers no longer feel like going elsewhere. 8. What is the percentage of customers using Loyalty Cards?

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 On an average every Reliance Fresh is issuing 80-120 loyalty cards per day. The ratio of customers using this card floats between 50%-60%. Educated people are giving more attention to the loyalty card. 9. How many customers are having more then one card? Why? Customers are not able to retain existing paper card for a long time so customers can be issued a new card with the same number if the exiting card cannot be scanned by machine properly. 10% cards cannot be scanned as these are paper cards and get distorted. 10. How we can build our product awareness? The advantages of a customer card must be actively conveyed from the management to the customer via the staff. We can utilize the time of customers by making them aware about the reward program when they are waiting for billing. Regular announcements can be made by the MSRs regarding the benefits of the Loyalty Card and asking customers to use the benefits of the program. Clippings about the product may be flashed through the electronic media. Details of the Loyalty Program may also be circulated through pamphlets in newspapers.

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11. What are the problems being faced by customers? How we can work on it? Token system should be introduced, as yet customers are facing problems as their belongings are not safe outside the store. Customers have to wait for a long time for billing so we can introduce a system of separate queues for ladies and senior citizens and can also increase number of cash counters. Customer is coming in Reliance Fresh due to a brand name and thinking its product would be of good quality, but sometimes there are rotten fruits and vegetables with the bunch of fresh ones this leads to a wrong impression on customers. So, there should be proper sorting to maintain the consistency in there quality. Proper availability of stock should be maintained to cater to the needs of customers. Sometimes store staff are ignorant and dont pay much attention to customers and this frustrates the customers. So store staff should be trained to assist the customers in a proper way. Facility of drinking water should be provided at the store which is not available at present . Toilets for customers should be made available. There should be counting of items purchased by a customer at the billing point to prevent misplacement.

12. How to increase efficiency of employees? Providing refreshments like tea, coffee at least in two intervals so that the employees feel energetic and work more efficiently.

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 Orientation program can be conducted for the employees to make them aware of the targets to be achieved. The employees should be kept in high state of morale. This could be achieved by the effective leadership. Career progression of the employees should be chalked out.

2.3

RELIANCEONE MEMBERSHIP CARD

This is a card which was given to the customer at free of cost. This card helps to increase the loyalty sales percentage of the store. Benefits of this card are: Customer will get 1% point of his purchasing amount added to his\her membership card. When these points will become 25, it means that 25 points is equivalent to 25/-. He\she will be able to redeem his\her points & get a discount of 25/CUSTOMER INFORMATION CHANGE REQUEST

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If customer wants to change his Postal address, Telephone Number or Email ID then customer have to fill the Customer Information Change request.

PROCEDURE OF REPLENISHMENT OF STOCK

The whole system of RELIANCE FRESH is connected through an ERP SOFTWARE i.e. SAP and the replenishment procedure is based on auto indenting & manual indenting. Auto Indenting MBQ of each SKU is already stored in the system of DISTRIBUTION CENTRE. (D.C. is the place from where the required quantity of stock is sent to the respective stores.) As & when sales of a particular SKU takes place it is automatically recorded in the system. Within 3 days D.C. dispatches the required quantity of each SKU to the store, to maintain the MBQ level of each shelf. Manual Indenting Before closing the store daily CSA of each category identify the requirement of each SKU and communicate it to supervisor and finally it is feed to SAP or mailed to Distribution Centre (D.C.) to maintain the required level of inventory.

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SUGGESTIONS
Announcement for the Membership card should be there. Effective utilization of storage space is possible. Possibility of Non-Food FMCG Effective utilization of empty Shelves Consistency in quality should be maintained. Proper training should be imparted to CSAs. Effective utilization of space should be done. Mark down of SKUs especially for Fruits & Vegetables should be done at proper time. Sample of wheat and other staple items can be kept for better exposure.

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