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Customer relationship management

Customer relationship management (CRM) consists of the processes a company uses

to track and organize its contacts with its current and prospective customers. CRM

software is used to support these processes; information about customers and customer

interactions can be entered, stored and accessed by employees in different company

departments. Typical CRM goals are to improve services provided to customers, and to

use customer contact information for targeted marketing.

While the term CRM generally refers to a software-based approach to handling customer

relationships, most CRM software vendors stress that a successful CRM effort requires a

holistic approach. CRM initiatives often fail because implementation was limited to

software installation, without providing the context, support and understanding for

employees to learn, and take full advantage of the information systems. CRM can be

implemented without major investments in software, but software is often necessary to

explore the full benefits of a CRM strategy.

Other problems occur when failing to think of sales as the output of a process that itself

needs to be studied and taken into account when planning automation

Overview

From the outside, customers interacting with a company perceive the business as a single

entity, despite often interacting with a number of employees in different roles and

departments. CRM is a combination of policies, processes, and strategies implemented by

an organization to unify its customer interactions and provide a means to track customer

information. It involves the use of technology in attracting new and profitable customers,while forming tighter bonds with existing ones.

CRM includes many aspects which relate directly to one another:

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Front office operations Direct interaction with customers, e.g. face to face

meetings, phone calls, e-mail, online services etc.

Back office operations Operations that ultimately affect the activities of the

front office (e.g.,billing, maintenance, planning, marketing,advertising,finance,

manufacturing, etc.)

Business relationships Interaction with other companies and partners, such as

suppliers/vendors and retail outlets/distributors, industry networks (lobbying

groups, trade associations). This external network supports front and back office

activities.

Analysis Key CRM data can be analyzed in order to plan target-marketing

campaigns, conceive business strategies, and judge the success of CRM activities

(e.g., market share, number and types of customers, revenue,profitability).

Proponents of CRM software claim that it doesn't only allow more effective ways of

managing customer relationships, but also more customer-centric ways of doing

business[5].

Types/variations of CRM

There are several different approaches to CRM, with different software packagesfocusing on different aspects. In general,Customer Service,Campaign Managementand

Sales Force Automation (SFA) form the core of the system (with SFA being the most

popular[citation needed]).

Operational CRM

Operational CRM provides support to "front office" business processes, e.g. tosales,

marketing and service staff. Interactions with customers are generally stored in

customers' contact histories, and staff can retrieve customer information as necessary.

The contact history provides staff members with immediate access to important

information on the customer (products owned, prior support calls etc.), eliminating the

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need to individually obtain this information directly from the customer. Reaching to the

customer at right time at right place is preferable.

Operational CRM processes customer data for a variety of purposes:

Managing campaigns

Enterprise Marketing Automation

Sales Force Automation

Sales Management System

Analytical CRM

Analytical CRM analyzes customer data for a variety of purposes:

Designing and executing targeted marketing campaigns

Designing and executing campaigns, e.g. customer acquisition,cross-selling,up-

selling, addon-selling

Analyzing customer behavior in order to make decisions relating to products and

services (e.g.pricing,product development)

Management information system (e.g. financial forecasting and customer

profitability analysis)

Analytical CRM generally makes heavy use ofdata mining and other techniques to

produce useful results for decision-making

Sales Intelligence CRM

Sales Intelligence CRM is similar to Analytical CRM, but is intended as a more direct

sales tool. Features include alerts sent to sales staff regarding:

Cross-selling/Up-selling/Switch-selling opportunities

Customer drift

Sales performance

Customer trends

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http://en.wikipedia.org/w/index.php?title=Enterprise_Marketing_Automation&action=edit&redlink=1http://en.wikipedia.org/wiki/Sales_Force_Automationhttp://en.wikipedia.org/w/index.php?title=Sales_Management_System&action=edit&redlink=1http://en.wikipedia.org/wiki/Cross-sellinghttp://en.wikipedia.org/wiki/Cross-sellinghttp://en.wikipedia.org/wiki/Cross-sellinghttp://en.wikipedia.org/wiki/Up-sellinghttp://en.wikipedia.org/wiki/Up-sellinghttp://en.wikipedia.org/w/index.php?title=Addon-selling&action=edit&redlink=1http://en.wikipedia.org/wiki/Pricinghttp://en.wikipedia.org/wiki/Product_developmenthttp://en.wikipedia.org/wiki/Management_information_systemhttp://en.wikipedia.org/wiki/Data_mininghttp://en.wikipedia.org/wiki/Data_mininghttp://en.wikipedia.org/w/index.php?title=Customer_drift&action=edit&redlink=1http://en.wikipedia.org/w/index.php?title=Enterprise_Marketing_Automation&action=edit&redlink=1http://en.wikipedia.org/wiki/Sales_Force_Automationhttp://en.wikipedia.org/w/index.php?title=Sales_Management_System&action=edit&redlink=1http://en.wikipedia.org/wiki/Cross-sellinghttp://en.wikipedia.org/wiki/Up-sellinghttp://en.wikipedia.org/wiki/Up-sellinghttp://en.wikipedia.org/w/index.php?title=Addon-selling&action=edit&redlink=1http://en.wikipedia.org/wiki/Pricinghttp://en.wikipedia.org/wiki/Product_developmenthttp://en.wikipedia.org/wiki/Management_information_systemhttp://en.wikipedia.org/wiki/Data_mininghttp://en.wikipedia.org/w/index.php?title=Customer_drift&action=edit&redlink=1


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Customer margins

Customer alignment

Campaign Management

Campaign management combines elements of Operational and Analytical CRM.

Campaign management functions include:

Target groups formed from the client base according to selected criteria

Sending campaign-related material (e.g. on special offers) to selected recipients

using various channels (e.g. e-mail, telephone, SMS, post)

Tracking, storing, and analyzing campaign statistics, including tracking responses

and analyzing trends

Collaborative CRM

Collaborative CRM covers aspects of a company's dealings with customers that are

handled by various departments within a company, such as sales, technical support and

marketing. Staff members from different departments can share information collected

when interacting with customers. For example, feedback received by customer support

agents can provide other staff members with information on the services and features

requested by customers. Collaborative CRM's ultimate goal is to use information

collected by all departments to improve the quality of services provided by the company.

Consumer Relationship CRM

Consumer Relationship System (CRS) covers aspects of a company's dealing with

customers handled by the Consumer Affairs and Customer Relations contact centers

within a company. Representatives handle in-bound contact from anonymous consumers

and customers. Early warnings can be issued regarding product issues (e.g. item recalls)

and current consumer sentiment can be tracked (voice of the customer).

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Strategy

Several CRM software packages are available, and they vary in their approach to CRM.

However, as mentioned above, CRM is not just a technology but rather a comprehensive,

customer-centric approach to an organization's philosophy of dealing with its customers.

This includes policies and processes, front-of-house customer service, employee training,

marketing, systems and information management. Hence, it is important that any CRM

implementation considerations stretch beyond technology toward the broader

organizational requirements.

The objectives of a CRM strategy must consider a companys specific situation and its

customers' needs and expectations. Information gained through CRM initiatives can

support the development of marketing strategy by developing the organization's

knowledge in areas such as identifying customer segments, improving customer

retention, improving product offerings (by better understanding customer needs), and by

identifying the organization's most profitable customers

CRM strategies can vary in size, complexity, and scope. Some companies consider a

CRM strategy only to focus on the management of a team of salespeople. However, other

CRM strategies can cover customer interaction across the entire organization. Manycommercial CRM software packages provide features that serve the sales, marketing,

event management, project management, and finance industries.

From this perspective, CRM has for some time been seen to play an important role in

many sales process engineering efforts.

Implementation issues

Many CRM project "failures" are also related to data quality andavailability. Data

cleaning is a major issue. If a company's CRM strategy is to track life-cycle revenues,

costs, margins, and interactions between individual customers, this must be reflected in

all business processes. Data must be extracted from multiple sources (e.g.,

departmental/divisional databases such as sales, manufacturing, supply chain, logistics,

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finance, service etc.), which requires an integrated, comprehensive system in place with

well-defined structures and high data quality. Data from other systems can be transferred

to CRM systems using appropriate interfaces.

Because of the company-wide size and scope of many CRM implementations, significant

pre-planning is essential for smooth roll-out. This pre-planning involves a technical

evaluation of the data available and the technology employed in existing systems. This

evaluation is critical to determine the level of effort needed to integrate this data.

Equally critical is the human aspect of the implementation. A successful implementation

requires an understanding of the expectations and needs of the stakeholders involved. An

executive sponsor should also be obtained to provide high-level management

representation of the CRM project.

An effective tool for identifying technical and human factors before beginning a CRM

project is a pre-implementation checklist. A checklist can help ensure any potential

problems are identified early in the process.

Privacy and data security System

One of the primary functions of CRM software is to collect information about customers.

When gathering data as part of a CRM solution, a company must consider the desire for

customer privacy and data security, as well as the legislative and cultural norms. Some

customers prefer assurances that their data will not be shared with third parties without

their prior consent and that safeguards are in place to prevent illegal access by third

parties.

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Overview

Indian Retail: An Overview

As organised retailers carve out a bigger piece of the retail pie for themselves its anexciting time for the retail sector. By Dominic K

Emerging markets such as India and China are the final frontier for retail taking the focus

away from saturated Western markets. Since 2001, 49 global retailers entered 90 new

markets, but at the same time, 17 retailers left markets in 2005.

The Indian retail industry in valued at about $300 billion and is expected to grow to $427

billion in 2010 and $637 billion in 2015. Only three percent of Indian retail is organised.Retailers of multiple brands can operate through a franchise or a cash-and-carry

wholesale model.

Retail is Indias largest industry, accounting for over 10 percent of the countrys GDP

and around eight percent of employment. Retail in India is at the crossroads. It has

emerged as one of the most dynamic and fast paced industries with several players

entering the market. That said, the heavy initial investments required make break even

hard to achieve and many players have not tasted success to date. However, the future is

promising; the market is growing, government policies are becoming more favourable

and emerging technologies are facilitating operations.

Retailing in India is gradually inching its way to becoming the next boom industry. The

whole concept of shopping has altered in terms of format and consumer buying behavior,

ushering in a revolution in shopping. Modern retail has entered India as seen in sprawling

shopping centres, multi-storeyed malls and huge complexes offer shopping,

entertainment and food all under one roof.

The Indian retailing sector is at an inflexion point where the growth of organised retail

and growth in the consumption by Indians is going to adopt a higher growth trajectory.

The Indian population is witnessing a significant change in its demographics. A large

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young working population with median age of 24 years, nuclear families in urban areas,

along with increasing working-women population and emerging opportunities in the

services sector are going to be the key growth drivers of the organised retail sector.

Initially, this was about Indian corporate houses rolling out malls and supermarkets, but

with Wal-Mart coming into the Indian market, the era of the superstore is dawning.

Unlike the kirana stores that served us for decades, this new breed of retail chains is

heavily dependent on IT.

Wal-Mart, the worlds largest retailer, and Bharti Enterprises have signed a

Memorandum of Understanding (MoU) to explore business opportunities in the Indian

retail industry. This joint venture will mark the entry of Wal-Mart into the Indian

retailing industry.

The biggest competitor for Bharti-Wal-Mart is likely to be Reliance Retail, the retail

wing of Reliance, which had planned to establish 10,000 stores by 2010. It had already

opened 11 pilot stores under the Reliance Fresh format in Hyderabad.

All these trends and developments present a great business opportunity for software and

hardware vendors from across the globe. Indian solution providers are targeting this

segment have reason to rejoice. For while organised retail occupies a miniscule two to

three percent of the overall Indian retailing industry, that is poised to change.

In spite of the prospects being good things arent quite as rosy when it comes to

awareness of IT systems. In most cases, organised retailers in India have installed

solutions that help them automate transactional systems.

With the retail sector in India undergoing a transformation due to the entry of large

corporate houses, IT managers and CIOs are now looking forward to know how IT can

help them achieve the business goals of their organisations.

Standards-based architecture and software support all kinds of mission-critical IT

applications for enabling greater efficiency, significant cost savings, and new business

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value. The critical activities that can be handled by IT are finance and accounting,

business intelligence, vendor development and management, supply chain management,

merchandising and inventory management, facilities management, stores management,

customer relationship management, branding, marketing, sales promotion and HR.

Like any other vertical, retail also stands to benefit from elaborate IT set-ups. However,

this is subject to the scale and size of the organisation, as well as an objective assessment

of its requirements. Key common challenges that can be tackled through IT

implementations include accurate merchandising, improved planning, increasing

profitability, enhancing customer experience, strengthening store operations, improved

workforce management, and improving the supply chain. This is in fact one of the key

imperatives facing retailers in India, to have a robust and scalable supply chain that willfacilitate rapid growth.

Since a basic objective is to make data available to users and customers, proper IT

implementation and superior IT infrastructure ensure that in spite of getting minimal

details, the retailer captures the right information, which flows to everyone from the back

office staff to the head office managers. The entire information flow must be seamless. A

retail business works on a network environment because the stores connect to one another

as well as to supplier sites. This is because in the retail business quick response is the key

to success. Proper IT implementation also ensures that investment in retail reduces

substantially.

The CRM Best Practice Kit includes a superbly illustrated 63 foil presentation which introduces

the key concepts and ideas behind successful CRM. It is ideal for both personal awareness or

group workshop training. The following foils are intended to demonstrate the quality and depth

of this offering:

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Services > Customer Relationship Management (CRM) Solution > How to

implement CRM solution

The success of any CRM solution is largely dependant upon the commitment of your

organization. The benefits described above will not be realized by buying software and

installing it. Here it is vital to get buy-in from the top down within these teams, andyou might as well get the marketing folks involved too. Next you need to decide on the

types of customer information you want to collect and what you plan to do with it. For

example, many grocery stores keep track of customers' purchase history in order to

market appropriate items likely to fit into their individual diets. Custom coupon packets

can be mailed to customers with products specific to their buying habits. This results in

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increased sales while at the same time giving the customer what they want.

Next, you will need to identify all possible ways new and existing customer information

can flow into your system. Where and how this information gets stored, as well as, how it

will be used and by whom. Your company, for instance, may interact with customers in a

variety of ways including mail campaigns, seminars, trade shows, electronic marketing,

Web sites, call centers, help desks and sales forces. Your CRM solution will connect all

of these customer touch points giving all of your various employees the same view of

the data. Powerful analytical tools allow the data to be manipulated and reports generated

that can provide a holistic view of customers and prospects. Armed with this customer

knowledge allows you to take the necessary steps to keep that customer happy.

Astir IT has trained specialists available to help with your deployment. We can help with

your business process analysis and refinement, and customize and install Microsoft

Dynamics CRM and train your staff. As CRM experts we bring a lot of value to whole

implementation process and look forward to be a long term partner as your business

grows.

How much does CRM cost?

The cost of implementation varies depending on your needs. Today there are hosted

versions available for as little as $65/user per month to full-blown implementations that

cost a few million dollars. If you are using an external agency to help you implement, you

should expect the cost of their services to be at least equal to the cost of the software and

hardware for a small implementation. For larger implementations, the cost of the services

tends to be much higher.

How do I ensure a successful CRM implementation?

First and foremost, get executive level buy-in and commitment to the project.

Make certain that they understand the importance of their role in upholding

that commitment and communicate it downwards through the organization.

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Make the project fun and rewarding. Give all key employees who will be

using the system incentives for making it work. Involve them in the early

planning and implementation stages. Take their feedback seriously. This will

give them ownership in the project.

Break the entire project down into smaller manageable pieces with small

milestones. Work with all departments to maintain a team methodology.

Use a robust database platform. CRM systems collect huge amounts of data

very rapidly. Make sure your solution can grow and perform accordingly.

Keep in mind that your system is designed around the customer and

prospect. Make sure that it is used to its potential in serving them well.

What department should be responsible for CRM?This question comes up a lot. The simple answer is everyone. What we mean is try to

spread project responsibilities across all departments that will have a hand in the success

of the solution. Usually the IT department takes the lead in . This will ensure consistent

buy-in across the organization and enforce team attitudes and ownership. Dont forget

that commitment needs to come from and be supported by the top execs!

Can a CRM system be customized for my vertical?

Microsoft CRM is open enough to allow even the most complex customization that can

mold that CRM system to practically any vertical. Systems can easily be customized to

work exactly the way your industry needs them to work, yet it will save countless hours

of manual labor and frustration in dealing with customers and prospects. Many industry

pundits see these custom vertical CRM systems as the real future of the application.

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channels. It is a solution that brings people, processes and data together so companies can

better serve and retain their customers. The data/activities can be structured, unstructured,

conversational, and/or transactional in nature.

Collaborative CRM provides the following benefits:

Enables efficient productive customer interactions across all communications

channels.

Enables web collaboration to reduce customer service costs.

Integrates call centers enabling multi-channel personal customer interaction.

Integrates view of the customer while interaction at the transaction level.

CRM has to two typical implementation methods: on-premise and on-demand/hosted.

Each method has

its advantages and disadvantages as described below.

On-premise CRM is appropriate for:

Companies seeking to implement highly customized customer-management

practices

Companies that need specialized data structures

Companies with complex or real-time integration requirements

Companies with available in-house IT resources and support systems

Companies who can afford the up-front capital investment and fixed costs

Companies who deal with sensitive data that don't want other parties to see

On-demand/hosted CRM is appropriate for:

Customers seeking to implement standard processes from a variety of industries

and companies

Companies that are able to use standard data structures

Companies with more basic integration requirements

Companies with limited technical resources and support personnel

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Companies seeking variable pricing and lower up-front costs

Companies dealing with non-proprietary data

Definition:

Customer Relationship Management (CRM) refers to the methodologies and tools that

help businesses manage customer relationships in an organized way.

For small businesses, customer relationship management includes:

- CRM processes that help identify and target their best customers, generate quality sales

leads, and plan and implement marketing campaigns with clear goals and objectives;

- CRM processes that help form individualized relationships with customers (to improve

customer satisfaction) and provide the highest level of customer service to the most

profitable customers;

- CRM processes that provide employees with the information they need to know theircustomers' wants and needs, and build relationships between the company and its

customers.

Customer relationship management tools include software and browser-based

applications that collect and organize information about customers. For instance, as part

of their CRM strategy, a business might use a database of customer information to help

construct a customer satisfaction survey, or decide which new product their customers

might be interested in.

Also Known As: CRM; sometimes called customer service management.

Common Misspellings: Customer relationship managment.

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Examples: Using customer relationship management (CRM) tools, Termite

Extermination Inc. was able to develop and implement a marketing plan that increased

sales dramatically.

CRM (customer relationship management) is an information industry term for

methodologies, software, and usually Internet capabilities that help an enterprisemanage

customer relationships in an organized way. For example, an enterprise might build a

databaseabout its customers that described relationships in sufficient detail so that

management, salespeople, people providing service, and perhaps the customer directly

could access information, match customer needs with product plans and offerings, remind

customers of service requirements, know what other products a customer had purchased,

and so forth.

Ask your CRM questions at ITKnowledgeExchange.com

According to one industry view, CRM consists of:

Helping an enterprise to enable its marketing departments to identify and targettheir best customers, manage marketing campaigns and generate quality leads for

the sales team.

Assisting the organization to improve telesales, account, and sales management

by optimizing information shared by multiple employees, and streamlining

existing processes (for example, taking orders using mobile devices)

Allowing the formation of individualized relationships with customers, with the

aim of improving customer satisfaction and maximizing profits; identifying the

most profitable customers and providing them the highest level of service.

Providing employees with the information and processes necessary to know their

customers, understand and identify customer needs and effectively build

relationships between the company, its customer base, and distribution partners.

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Many organizations turn to CRM software to help them manage their customer

relationships. CRM technology is offered on-premise, on-demand or through Software as

a Service (SaaS) CRM, depending on the vendor. Recently, mobile CRM and the open

source CRM software model have also become more popular.

Services > Customer Relationship Management (CRM) Solution > How to

implement CRM solution

The success of any CRM solution is largely dependant upon the commitment of your

organization. The benefits described above will not be realized by buying software and

installing it. Here it is vital to get buy-in from the top down within these teams, andyou might as well get the marketing folks involved too. Next you need to decide on the

types of customer information you want to collect and what you plan to do with it. For

example, many grocery stores keep track of customers' purchase history in order to

market appropriate items likely to fit into their individual diets. Custom coupon packets

can be mailed to customers with products specific to their buying habits. This results in

increased sales while at the same time giving the customer what they want.

Next, you will need to identify all possible ways new and existing customer information

can flow into your system. Where and how this information gets stored, as well as, how it

will be used and by whom. Your company, for instance, may interact with customers in a

variety of ways including mail campaigns, seminars, trade shows, electronic marketing,

Web sites, call centers, help desks and sales forces. Your CRM solution will connect all

of these customer touch points giving all of your various employees the same view of

the data. Powerful analytical tools allow the data to be manipulated and reports generated

that can provide a holistic view of customers and prospects. Armed with this customer

knowledge allows you to take the necessary steps to keep that customer happy.

Astir IT has trained specialists available to help with your deployment. We can help with

your business process analysis and refinement, and customize and install Microsoft

Dynamics CRM and train your staff. As CRM experts we bring a lot of value to whole

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implementation process and look forward to be a long term partner as your business

grows.

How much does CRM cost?

The cost of implementation varies depending on your needs. Today there are hosted

versions available for as little as $65/user per month to full-blown implementations that

cost a few million dollars. If you are using an external agency to help you implement, you

should expect the cost of their services to be at least equal to the cost of the software and

hardware for a small implementation. For larger implementations, the cost of the services

tends to be much higher.

How do I ensure a successful CRM implementation?

First and foremost, get executive level buy-in and commitment to the project.

Make certain that they understand the importance of their role in upholding

that commitment and communicate it downwards through the organization.

Make the project fun and rewarding. Give all key employees who will be

using the system incentives for making it work. Involve them in the early

planning and implementation stages. Take their feedback seriously. This will

give them ownership in the project.

Break the entire project down into smaller manageable pieces with small

milestones. Work with all departments to maintain a team methodology.

Use a robust database platform. CRM systems collect huge amounts of data

very rapidly. Make sure your solution can grow and perform accordingly.

Keep in mind that your system is designed around the customer and

prospect. Make sure that it is used to its potential in serving them well.

What department should be responsible for CRM?

This question comes up a lot. The simple answer is everyone. What we mean is try to

spread project responsibilities across all departments that will have a hand in the success

of the solution. Usually the IT department takes the lead in . This will ensure consistent

buy-in across the organization and enforce team attitudes and ownership. Dont forget

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that commitment needs to come from and be supported by the top execs!

Can a CRM system be customized for my vertical?

Microsoft CRM is open enough to allow even the most complex customization that can

mold that CRM system to practically any vertical. Systems can easily be customized to

work exactly the way your industry needs them to work, yet it will save countless hours

of manual labor and frustration in dealing with customers and prospects. Many industry

pundits see these custom vertical CRM systems as the real future of the application.

Notes & References

1. ^ Malthouse, Edward C; Bobby J Calder (2005). "Relationship Branding and CRM". in Alice

Tybout and Tim Calkins.Kellogg on Branding. Wiley. pp. 150168.

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2. ^ Rigby, Darrell K.; Frederick F. Reichheld, Phil Schefter (2002). "Avoid the four perils of

CRM".Harvard Business Review80 (2): 101109. doi:10.1225/8946.

3. ^ Paul H. Selden (April/May 1996). "SFA Myths Abound". Sales and Marketing Strategies

& News6 (3): 51 and 53.

4. ^ Paul H. Selden (November 2000). "The Power of Quality Thinking In Sales and

Management". Quality Progress: 58-64.

5. ^ Interview with Dick Lee at Effective CRM

6. ^ Edwards, John (2007-11-29). "Get It Together with Collaborative CRM". insideCRM.

Tippit. http://www.insidecrm.com/features/collaborative-crm-112907/. Retrieved on 2008-02-

01.

7. ^ Bligh, Philip; Douglas Turk (2004). CRM unplugged releasing CRM's strategic value.

Hoboken: John Wiley & Sons.ISBN 0-471-48304-4.

8. ^ Paul H. Selden (1997).Sales Process Engineering: A Personal Workshop. Milwaukee,

WI: ASQ Quality Press. p. 23.

9. ^ Dyche, 2002, Managing Your CRM Project

10. ^ Gartner, Inc (2008-09-12).Gartner Says Worldwide Customer Relationship Management

Market Grew 23 Percent in 2007. Press release.http://www.gartner.com/it/page.jsp?

id=715308. Retrieved on 2008-08-15.

11. ^ Gartner, Inc. (22 June 2007)Commonly Deployed CRM Application Vendors in 2006

12. ^ Datamonitor (22 August 2007). Datamonitor suggests Oracle, SAP likely to remain atop

CRM market

strategy cannot be implemented by simply installing and integrating a software package,

a holistic approach is needed. It needs a lot more and a certain regimentation to make

sure that it succeeds and gets incorporated well in the overall system.

It require very close and careful implementation and monitoring by the entire

management, including top management

This Approach may include:

Training of Employees

A Modification of Business Processes based on customers' needs

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http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-1http://en.wikipedia.org/wiki/Digital_object_identifierhttp://en.wikipedia.org/wiki/Digital_object_identifierhttp://dx.doi.org/10.1225%2F8946http://dx.doi.org/10.1225%2F8946http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-Selden_1996_2-0http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-Selden2000_3-0http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-4http://www.effective-crm-consulting.com/business-process-guru.htmlhttp://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-5http://www.insidecrm.com/features/collaborative-crm-112907/http://www.insidecrm.com/features/collaborative-crm-112907/http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-crmunplugged_6-0http://en.wikipedia.org/wiki/Special:BookSources/0471483044http://en.wikipedia.org/wiki/Special:BookSources/0471483044http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-Selden_1997_7-0http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-8http://www.informit.com/articles/article.aspx?p=25181http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-9http://www.gartner.com/it/page.jsp?id=715308http://www.gartner.com/it/page.jsp?id=715308http://www.gartner.com/it/page.jsp?id=715308http://www.gartner.com/it/page.jsp?id=715308http://www.gartner.com/it/page.jsp?id=715308http://www.gartner.com/it/page.jsp?id=715308http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-10http://mediaproducts.gartner.com/reprints/oracle/149500.htmlhttp://mediaproducts.gartner.com/reprints/oracle/149500.htmlhttp://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-11http://www.dmnews.com/Datamonitor-suggests-Oracle-SAP-likely-to-remain-atop-CRM-market/article/98266/http://www.dmnews.com/Datamonitor-suggests-Oracle-SAP-likely-to-remain-atop-CRM-market/article/98266/http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-1http://en.wikipedia.org/wiki/Digital_object_identifierhttp://dx.doi.org/10.1225%2F8946http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-Selden_1996_2-0http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-Selden2000_3-0http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-4http://www.effective-crm-consulting.com/business-process-guru.htmlhttp://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-5http://www.insidecrm.com/features/collaborative-crm-112907/http://www.insidecrm.com/features/collaborative-crm-112907/http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-crmunplugged_6-0http://en.wikipedia.org/wiki/Special:BookSources/0471483044http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-Selden_1997_7-0http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-8http://www.informit.com/articles/article.aspx?p=25181http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-9http://www.gartner.com/it/page.jsp?id=715308http://www.gartner.com/it/page.jsp?id=715308http://www.gartner.com/it/page.jsp?id=715308http://www.gartner.com/it/page.jsp?id=715308http://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-10http://mediaproducts.gartner.com/reprints/oracle/149500.htmlhttp://en.wikipedia.org/wiki/Customer_Relationship_Management#cite_ref-11http://www.dmnews.com/Datamonitor-suggests-Oracle-SAP-likely-to-remain-atop-CRM-market/article/98266/http://www.dmnews.com/Datamonitor-suggests-Oracle-SAP-likely-to-remain-atop-CRM-market/article/98266/


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And an Adoption of Relevant IT Systems (including software and maybe

hardware) and/or usage of IT service that enable the organization or company to

follow its CRM strategy.

Let us review each of the above three aspects:

Employee training to begin with indeed, all employees and at all levels must be

periodical trained with the concept of CRM and also kept updated regularly. No software

or automation can replace human efforts and concept of CRM. Yes, they can come to aid

its implementation, bit no where will it replace essential ingredients of human touch and

service. Tainting of employees should include technical training on the use and benefits

of software and IT application plus attitude and behavioral training towards customers

and their problems and services. Obviously, with training of employees comes

modification of processes and systems which goes to one make CRM easy and possible

and secondly, to go to further aid employees. In implementation of CRM effectively

CRM services can even replace the acquisition of additional hardware or CRM software

licenses. The term itself is meant to describe the whole business strategy (or lack of one)

oriented on customer needs.

The main misconception of CRM is that it is only software, instead of a whole business

strategy.To be effective, the CRM process needs to be integrated end-to-end across marketing,

sales, and customer service.

Customer Relationship Management

Introduction

The biggest management challenge in the new millennium of liberalization and

globalization for a business is to serve and maintain good relationship with the

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king the customer. In the past producers took their customers for granted,

because at that time the customers were not demanding nor had alternative

source of supply or suppliers. But today there is a radical transformation. The

changing business environment is characterized by economic liberalization,increasing competition, high consumer choice, demanding customer, more

emphasis on quality and value of purchase etc.

All these changes have made todays producer shift from traditional marketing

to modern marketing. Modern marketing calls for more than developing a

product, pricing it, promoting it and making it accessible to target customer. It

demands building trust, a binding force and value added relationship with the

customers.

The process of developing a cooperative and collaborative relationship between

the buyer and seller is called customer relationship management shortly called

CRM. According to Ashoka dutt head of Citi Bank the idea of CRM is to

know the individual customer intimately, so that the company has a customized

product ready for him even before he asks for it.

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Aims of CRM

The CRM is a new technique in marketing where the marketer tries to develop

long term relationship with the customers to develop them as life time

customers. CRM aims to make the customer climb up the ladder of loyalty.

The company first tries to determine who are likely prospects i.e. the people

who have a strong potential interest in the product and ability to pay for it. The

company hopes to convert many of its qualified prospect into first time

customers and then to convert those first time customers into repeat customers.

Then the company tries to convert these repeat customers into clients they are

those people who buy only from the company in the relevant product

categories. The next challenge for the company is to convert these client into

advocates. Advocates are those clients who praise the company and encourage

others to buy from it.

The ultimate challenge is to convert these advocates into partners where the

customers and the clients work actively together to discover ways of getting

mutual benefit.

Thus in CRM the key performance figure is not just current market share but

share of life time value by converting customers into partners.

In CRM the company tries to identify that small percentage (20%) of key

account holders whos contribution to the company revenues is high (80%). So

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from this point of view, CRM is also known as KEY ACCOUNT

MANAGEMENT.

Why customer relationship management

A satisfied customer in 10 years will bring 100 more customers to the

company.

It costs 7 time more to attract a new customer than to serve an old one.

20% of the companys loyal customers account for 80% of its revenues.

(Paretos principle).

The chances of selling to an existing customer are 1 in 2, the chances of

selling to a new customer are 1 in 16.

Eight ways to keep customers for life

1. Every part of the companys marketing effort should be geared towards

building lifetime relationships.

2. People want to do business with friendly people. To have effective relations

a friendly attitude must permeate in the organization.

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3. Information technology developments should be positively used to serve the

customers.

4. The company should always be flexible to bend its rules and procedures in

the clients favor.

5. The company should communicate with its customers even when it is not

trying to sell something.

6. The company can communicate and develop stronger customer bonding by

providing financial and social benefits.

7. The company should try to know all its customers including their lifestyles,

hobbies, likes and dislikes etc.

8. The company should make it a point to deliver more than what is promised.

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CRM in the Textile industry

In textile industry one company sell its product to another company. For

example a yarn manufacturing company sell to fabric manufacturing company.

A fabric manufacturing company sell fabric to apparel company. The main

customers of the companies in the textile industry are the wholesalers. And the

final product is sold to the wholesalers and retailers. In this industry the

customers are few and profit margins are high. So CRM is very much necessaryand relevant in this industry. There is a high degree of uncertainty on the part of

the buyers, the likelihood of customers seeking a relationship is increased. If

the firm loses its customer it would be major loss to the firm. The product in

the textile industry is complex and quality is an important factor. One of the

major values the customer expects from vendors is quality. No customer will

tolerate average quality. According to GEs chairman John quality is the best

assurance of customer allegiance and strongest defense against competition and

the only path to sustained growth and earnings. If the product is not of good

quality the customer will not be satisfied and the firm may lose its customer.

Moreover there is a scope of customization in the product. The seller has to

customize the product according to the need of the customer. Customization is

changing the product according to the need of the customer in order to satisfy

him.

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How to introduce CRM in the company

There are four key steps for putting one to one marketing program to

work

Step 1 : Identify your customers

To launch a one to one initiative the company must be able to locate and

contact a fair number of customers or at least a substantial portion of its

valuable customers. It is crucial to know the customer details as much as

possible, not just their names or address, but their habits, preferences and so

forth.

Step 2 : Differentiating your customers

Customers are different in two principal ways, they represent different levels ofvalue and have different needs. Once the company identifies its customers

differentiating them will help the company to focus its efforts to gain the most

advantage with the most valuable customers.

Step 3 : Interacting with the customer

Interaction is also a crucial component of a successful CRM initiative. It is

important to remember that interaction just not occur through marketing and

sales channels, customer interact in many different ways with many different

areas of the organization so to foster relationship all the areas of the

organization must be accessible to the customer.

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Step 4 : Customize your enterprises behavior

Ultimately to lock a customer into a relationship a company must adapt some

aspect of its behavior to meet customers individually expressed needs this

might mean mass customizing a manufactured product or it might involve

tailoring some aspect of the service surrounding the product.

Significance of the study

The CRM (customer relationship management) is an integrated effort to

strengthen the network of relationship for the mutual benefit of both the parties.

The biggest management challenge in the new millenium of liberalization and

globalization for a business is to maintain good relationship with the king the

customer. This study is of great significance because

A 5% increase in the customer retention will increase the profit up to 125%.

It costs seven time more to attract a new customer than to serve an old one.

20% of the companys loyal customers account for the 80% of its revenues.

To study on customer relationship management would enable the researcher

to know about the CRM practices adopted in the textile industry.

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Review of the existing literature

With the available literature we can summarize CRM in the words of various

authors as follows-

According to Shani and Chalarani Relationship marketing can be defined as

an integrated effort to identify, maintain and build up a network with the

individual customers and to continuously strengthen the network for the mutual

benefit of both parties, through interactive, individualized and value added

contracts over a long period of time.

In the words of Lekha CRM aims at delivering better products and value to

the customers through better understanding of his needs.

Conceptualization

A firm in textile industry has to maintain good relations with its customers.

They have to retain the customers for a long time to avail the benefit of their

relations. The customer relationship management is one of the effective tool to

identify, establish and maintain relationship with the customers. With the help

of this research we are going to identify the importance of CRM in textile

industry.

Focus of the problem

The textile industry is basically manufacturing based industry. Through this

study we are going to identify the importance of CRM in the textile industry.

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How it is benefited from CRM? Is their any relevance of implementing CRM?

And what role does information technology can play in CRM?

Objectives

1. To study the current practices of CRM.

2. To find out the impact of CRM on the profitability of the organization.

3. To study the factors affecting the CRM practices.

4. To study the role of information technology in CRM.

Analysis

The customers of the COMPANY are the wholesalers. It is because the number

of retailers is very large as compared to the wholesalers. So it is not possible for

the company to approach to the retailers. Therefore the company sells to the

wholesalers and then wholesalers sell to the retailers.

Customers are encouraged to give suggestions and complaints so that the

company can improve its working and services. If the customers complaintsare not resolved the customers will be dissatisfied and the company may lose

its customers.

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Different customers have different requirements. So the company customize its

product accordingly to satisfy the customers. It also gives more choice to the

customers.

To get the information about the customers and to measure the satisfaction the

company conducts surveys. Because of the expertise needed in the research the

company give this work to research agencies like AC NILSON.

The company gives credit facility to its customers to increase the sales volume.

If the company do not sell on credit the customers may switch over to other

companies.

The company maintains frequent communication with the customers. As soon

as the product is ready or a new product is launched the information is provided

to the customers. Communication is also necessary to maintain the interest of

the customers in the company.

The company gives concession to its regular customers so as to retain its most

valuable and profitable customers.

The company regularly reviews the business process in order to eliminate non

value-adding activities, to reduce the cost and to make the whole work efficient

and effective. If the internal customers are not satisfied and there is lack of

coordination among the departments then it will affect the external customers

also.

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Conclusion

From this study it can be concluded that the customer relationship management

in Company is satisfactory. The company is using various CRM practices like

customization of the product, maintaining interaction with the customers

regularly and providing good quality product etc. Customer relationship

management has a certain impact on the profitability of the company. Average

sale per customer has increased 15% over the last two years. Customer

response rate towards marketing activities is also improving. There are various

factors affecting the customer relationship management like working

environment of the company, support from top management and coordination

among the departments of the company. Information technology is not used as

much as it should be. The company is using traditional tools of CRM like

quantitative research, personal interviews. The company should modern tools

like data mining, contact center, e-CRM and web based survey tools.

Suggestions

There should be more and more emphasis given by the company

for satisfying the customer up to a apex limit and by providing the

utility of every penny of his money.

There should be more use of information technology.

The company should be flexible to bend its rules and procedures

in the clients favour.

The company can communicate and develop stronger customer

bonding by providing social and financial benefits.

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Retailing formats in India:

1. Malls:

The largest form of organized retailing today. Located mainly in metro

cities, in proximity to urban outskirts. Ranges from 60,000 sq ft to 7,00,000 sq ft

and above. They lend an ideal shopping experience with an amalgamation of

product, service and entertainment, all under a common roof. Examples include

Shoppers Stop, Pyramid, Pantaloon.

2. Specialty Stores:

Chains such as the Bangalore based Kids Kemp, the Mumbai books retailer

Crossword, RPG's Music World and the Times Group's music chain Planet M,

are focusing on specific market segments and have established themselvesstrongly in their sectors.

3. Discount Stores:

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As the name suggests, discount stores or factory outlets, offer discounts on

the MRP through selling in bulk reaching economies of scale or excess stock

left over at the season. The product category can range from a variety of

perishable/ non perishable goods.

4. Department Stores:

Large stores ranging from 20000-50000 sq. ft, catering to a variety of

consumer needs. Further classified into localized departments such as

clothing, toys, home, groceries, etc

5. Department Stores:

Departmental Stores are expected to take over the apparel business from

exclusive brand showrooms. Among these, the biggest success is K Raheja's

Shoppers Stop, which started in Mumbai and now has more than seven large

stores (over 30,000 sq. ft) across India and even has its own in store brand for

clothes called Stop!.

6. Hypermarts/Supermarkets:

Large self service outlets, catering to varied shopper needs are termed as

Supermarkets. These are located in or near residential high streets. These storestoday contribute to 30% of all food & grocery organized retail sales. Super

Markets can further be classified in to mini supermarkets typically 1,000 sq ft to

2,000 sq ft and large supermarkets ranging from of 3,500 sq ft to 5,000 sq ft.

having a strong focus on food & grocery and personal sales.

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7. Convenience Stores:

These are relatively small stores 400-2,000 sq. feet located near residential

areas. They stock a limited range of high-turnover convenience products and are

usually open for extended periods during the day, seven days a week. Prices are

slightly higher due to the convenience premium.

8. MBOs :

Multi Brand outlets, also known as Category Killers, offer several brands

across a single product category. These usually do well in busy market places

and Metros.

SPECIALITY STORES:

Food retail :

Food dominates the shopping basket in India. The US$ 6.1 billion Indian foodsindustry, which forms 44 per cent of the entire FMCG sales, is growing at 9 per

cent and has set the growth agenda for modern trade formats. Since nearly 60

per cent of the average Indian grocery basket comprises non-branded items, the

branded food industry is homing in on converting Indian consumers to branded

food.

The mobile revolution:

The retail market for mobile phones -- handset, airtime and accessories -- is

already a US$ 16.7 billion business, growing at over 20 per cent per year. In

comparison, the consumer electronics and appliance market is worth US$ 5.6

billion, with a growth rate that is half of the mobile market.

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Kidsretail:

When it comes to Indian children, retailers are busy bonding--and branding:

Monalisa, the Versace of kids is coming to India.

Global lifestyle brand Nautica is bringing Nautica Kids. International brand Zapp tied up with Raymond to foray into kids' apparel.

Disney launched exclusive chains which stock character-based stationery.

Pantaloon's joint venture with Gini & Jony will set up a retail chain to

market kids' apparel.

Swiss kidswear brand Milou is collaborating with Tirupur-based Sreeja

Hosieries.

Turner International India Pvt Ltd. will launch Cartoon Network Townsvilleand Planet POGO--two theme parks designed around its channels--in the

National Capital Region.

Sahara One Television has also signed a Memorandum of Understanding

to source content from Spacetoon Media Group, Middle East's largest

kids' entertainment brand for animation and live action content.

Leading the kids' retail revolution is the apparel business, which accounts for

almost 80 per cent of the revenue, with kids' clothing in India following

international fashion trends. According to research firm KSA Technopak, the

branded segment comprises US$ 701.7 million of the total kids' apparel market-

size of over US$ 3 billion.

Industry experts say kids' retailing will touch annual growth of 30-35 per cent.

Toys, stationary, sportswear, outerwear, tailored clothing, eyewear, watches,

fragrance, footwear, theme parks, TV channels the segment is growing rapidly

at 10 per cent per annum. Margins are in the range of 20-25 per cent (for dealers

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and distributors), while companies enjoy an average gross margin of about 10

per cent.

Agricultural retail:

Agriculture across India is heralding the country's second Green Revolution. 14

states, including Maharashtra, Punjab, Andhra Pradesh and Rajasthan amended

the Agricultural Produce Marketing Committee (APMC) act this year, along the

lines of the Model APMC Act, '02, which allows farmers to sell their produce

directly to buyers offering them the best price.

Agricultural sectors such as horticulture, floriculture, development of seeds,

animal husbandry, pisciculture, aqua culture, cultivation of vegetables,

mushroom under cultivated conditions and services related to agro and allied

sectors are open to 100 per cent FDI through the automatic route.

For its e-Choupal scheme, ITC built internet kiosks in rural villages so farmers

can access latest information on weather, current market prices, foods-in-demand, etc.

With a US$ 5.6 billion, multi-year investment in agriculture and retail, Reliance

Retail will establish links with farms on several thousand acres in Punjab, West

Bengal and Maharashtra. FieldFresh, planning to become India's first large-scale

exporter of produce, will annually pay farmers over US$ 30,000 to lease land for

vegetables, to hire tractors and to pay their workers.

Besides a five-year program with the Punjab government to provide several

hundred farmers with four million sweet-orange trees for its Tropicana juices by

2008, PepsiCo--with agriculture exports worth US$ 40 million--also introduced

farmers to high-yielding basmati rice, mangoes, potatoes, chilies, peanuts, and

barley for its Frito-Lay snacks.

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Export potential and a rapidly growing domestic demand for reliable produce

from new supermarket chains is driving change. With 77 per cent of India's

population relying on agriculture for a living, improved efficiency and new

markets can benefit a large number of people.

International retailers :

The Australian government's National Food Industry Strategy and Austrade

initiated a test marketing food retail in India wherein 12 major Australian food

producers have tied up with India-based distributor AB Mauri to sell their

products directly at retail outlets.

The largest-ever 150-member British business delegation in India committed

investments in the areas of food processing, agri retail and manufacturing. It is

also likely to press for the liberalisation of sectors like financial & legal services

and retail.

US-based home delivery and logistics company, Specialised Transportation Inc,

will enter the Indian market through a strategic alliance with Patel Retail, a

subsidiary of Patel Integrated Logistics.

Among other big international players, Wal-Mart has announced its plans for

India in partnership with Bharti, Tesco is sure to try again, and Carrefour too

might finally find the right partner.

Supermarkets:

Large self service outlets, catering to varied shopper needs are termed as

Supermarkets. These are located in or near residential high streets. These stores

today contribute to 30% of all food & grocery organized retail sales. Super

Markets can further be classified in to mini supermarkets typically 1,000 sq ft to

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2,000 sq ft and large supermarkets ranging from of 3,500 sq ft to 5,000 sq ft.

having a strong focus on food & grocery and personal sales.

Supermarkets are relatively new entrants in the market. They are so called

pioneers in organized food retailing and go by the western model in look and feel

and format. This is what everybody means when they say organized food

retailing.

Franchise outlets:

Like Tommy Hilfiger and Wal Mart, other US retailers are firming up their India

entry strategies and if they are already in, they are undergoing rapid expansion.Fashion brands DKNY is also al set to foray into the Indian fashion Industry

through a franchisee agreement with Indian company, S. Kumar Starbucks

recently expressed their interest in entering Indian company

Like Tommy Hilfiger and Wal-Mart, other US retailers are firming up their India

entry strategies and if they are already in, they are undergoing rapid expansion.

Fashion brand DKNY is also all set to foray into the Indian fashion Industry

through a franchisee agreement with Indian company, S Kumars.Starbucks

recently expressed their interest in entering India through the franchise route, like

their AmericanF&B counterparts Pizza Hut, Subway, and the very successful

McDonalds. McDonalds has major expansion plans lined up; in the next 3 years,

it plans to open another 100 outlets

in cities across India.

Hypermarket:

A very large commercial establishment that is a combination of departmental

store and a supermarket.

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The specific features of a hypermarket are the wide range of goods offered,

quality service, quality display of goods on the shelves and complex systems

providing for customers loyalty.

Hypermarket is known for a wide range of goods offered. It consist of dozens of

thousands of items, while similar goods can be offered in several forms. In order

to work with such an assortment it is necessary to group it into categories and

sub categories that would unite goods according to this or that criteria.

Shopping Malls:

The new shopping malls that have been expanding their footprint across Indian cities arewell designed, built on international formats of retailing and integrated with

entertainment and restaurants to provide a complete family experience. Over 300

malls are expected to be built over the next two years and most Indian cities with

over a million populations will be exposed to this modern method of retailing.

Shopping malls have existed in India since several decades but were designed

and built to house several shops in a single facility.

These malls also known as Shopping Arcades offered only rows of shops, most

of which were small stores that promised bargains for their various wares. These

Shopping Arcades tried to maximize on their store space and did not offer any

areas for recreation and entertainment.

The present day malls are a creation of the past few years post 2000. They aredesigned professionally using a lot of international experience and combine

shopping with a lot of brand building, recreation, food and entertainment.

Malls also have a large format store that serves as their anchor for shopping and

a prominent restaurant that anchors the food needs of visitors.

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Most malls also feature a multiplex cinema that offers entertainment to the

visitors of the mall. Finally the mall has large atria and open spaces to allow

visitors and families to hang-out.

Major Industry Players:

Nanz in North India, Nilgiris in the South, Pantaloon in the East and Crossroad in

the West were the pioneers of the retail revolution in India. Nanz faced several

obstacles (See Case Study) in their business and had to finally down their

shutters. Nilgiris, due to some strange reason, did not see any logic to expand

beyond the southern frontiers. Pantaloon went to scale up and become bigger

and bigger to form the Future Group, that is now omnipresent in almost all

formats right from small groceries to e-tailing. Crossroads in Mumbai imparted

some valuable lessons to their parent, the Piramyd Group, who has since then

gone on an expansion drive with other formats of retailing in different cities.

The big players in Indian retail landscape now are the Future Group, Shoppers

Stop, Westside, Subiksha and RPG Spencer. The newcomers who are knocking

at the gates are Reliance Retail, Bharti Walmart and Aditya Birla Trinethra. Here,

we intend to do a brief profiling of the major players in order to understand the

retail business in a better manner.

1 The Future Group Pantaloon Retail India Limited (PRIL)The Future Group, which was earlier known as PRIL (Pantaloon Retail India

Limited) began as a trouser manufacturer in the mid 1980s. The Future Group is

divided into six verticals Future Retail, Future Capital, Future Brands, Future

Space, Future Media and Future Logistics.

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The Future Group started operations in the mid 1987s by incorporating the

company as Manz Wear Private Limited. The company went on to manufacture

ready made trousers under the Pantaloons brand name. It came out with a

public issue in 1991 and later changed their name to Pantaloon Fashions (India)

Limited (PFIL).

The first exclusive mens store called Pantaloon Shoppe was inaugurated in

1992. Pantaloons went for a franchisee route to expand the number of retail

outlets and by 1995, it had reached to a crucial number of 70. The first

departmental store called Pantaloons was opened in Kolkata in 1997 with an

investment of Rs 0.7 million. The store was a success and recorded revenues of

Rs 100 million within the first year of operations. In 1999, the companys name

was changed to Pantaloon Retail (India) Limited (PRIL).

The success of Pantaloons departmental stores encouraged PRIL to come up

with other retailing formats such as Big Bazaar to retail low cost general

merchandising, and Food Bazaar to retail food products. As of 2005, the Future

Group has 3.5 million sq ft of retail space and over 100 stores across 25 cities in

India. It employs more than 12,000 people and has a customer base of more

than 120 million.

Kishore Biyani, the promoter of the group who likes to address himself as Chief

Knowledge Officer has plans to launch 18 formats and over 3,340 stores,

thereby turning the Future Group into a US$7 billion company with over US$1

billion in profits by the year 2010.

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2 Shoppers Stop

Shoppers Stop, promoted by the real estate group K Raheja, was one of the first

movers to have set up a large retail outlet in New Delhi with international

ambience. Shoppers Stop Ltd now has a considerable presence all over the

country with overr 7 lakh square feet of retail space and stocks over 200 brands

of garments and accessories. The stores are spread all over India with presence

in Mumbai, Delhi, Bangalore, Hyderabad, Jaipur, Pune , Kolkata, Gurgaon,

Chennai & Ghaziabad.

Shoppers Stop is also very well known for having pioneered several quality

retailing concepts in India like CROSSWORD, HyperCITY and Mothercare. They

are the only retailer from India to become a member of the prestigious

Intercontinental Group of Departmental Stores (IGDS).

Shoppers Stop is positioned as a family store delivering a complete shopping

experience. With its wide range of merchandise, exclusive shop-in-shop counters

of international brands and world-class customer service, Shoppers Stop

brought international standards of shopping to the Indian consumer providing

them with a world class shopping experience. Shoppers Stops core customers

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The Organisation, 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.

Realising the role of IT way back in 1991, Shoppers Stop was among the first

few retailers to use scanners 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. Shoppers Stop has been

very keen to understand the importance of distribution and logistics in ensuring

that merchandise is available on the shop floors.

This has led the retail chain o 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 build up, generation and fixing of

price and store tags, dispatch of stocks to the retail floor and forwarding of bills

for payment.

Shoppers Stop has a grand ambition 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.

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3 Trent Westside

Established in 1998, Trent operates some of the nation's largest and fastest

growing retail store chains. A beginning was made in 1998 with Westside, a

lifestyle retail chain, which was followed up in 2004 with Star India Bazaar, a

hypermarket with a large assortment of products at the lowest prices. In 2005, it

acquired Landmark, India's largest book and music retailer.

In a recently signed deal, Trent has agreed to anchor 12 malls set up by DLFUniversal Ltd across the country, at its Westside, Landmark and Star India

Bazaar outlets. This amounts to about 27 locations, totaling to about a million

square feet of space.

Trent retails garments and household accessories for men, women and children, cosmetics and perfumes at

Westside, food, beverages, health and beauty products, vegetables, fruits, dairy products, consumer

electronics and household items at Star India Bazaar and books, music and stationery at Landmark.

Westside has 25 outlets across 17 cities in India offering a variety of designs and

styles in garments, footwear and accessories, as table linens, artifacts, home

accessories and furnishings. Well-designed interiors, sprawling space, prime

locations and coffee shops enhance the customers' shopping experience.

Trent also runs another chain of retail stores called Star India Bazaar. Launched

in 2004, Star India Bazaar provides a large assortment of high quality products

made available at the lowest prices coupled with a unique shopping experience.

Star India Bazaar is located in Ahmedabad and offers a wide choice of staple

food, beverages, health and beauty products, vegetables, fruits, dairy products,

consumer electronics and household items at the most affordable prices.

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Trent has also recently acquired a 76 per cent stake in Landmark, one of the largest books and music retail

chains in India. Landmark commenced its operations in 1987 with its first store in Chennai, and now has

nine stores in the major metros of the country.

Earlier Landmark was focused on books, stationery and greeting cards. In 1996 it

added music to its product portfolio and also started the trend of stocking curios,

toys, music, CDs and other gift items.

4.Piramyd

Piramyd Retail is part of the Piramal Group, which has presence in diverse

sectors spanning Pharmaceuticals, Textiles, Real Estate, Engineering, Family

Entertainment and Retail with manufacturing operations in 19 locations across

five states and employing over 18,000 people. The promoters launched the

apparel business in 1999 under Piramyd Retail and Merchandising Pvt. Ltd.

(PRMPL) while its food; home & personal care businesses (FHPC) were housed

under Crossroads Shoppertainment Pvt. Ltd.

(CSPL). As the apparel and food businesses individually reached a critical mass

the management merged the two companies into Piramyd Retail Ltd. due to

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distant synergies in two businesses in March 2005. Pyramid also has a smaller

format of stores called TruMart that caters to Food and Personal Care products.

Piramyd Retail currently has 5 Mega stores and 8 TruMart stores mainly in

Maharashtra . The company plans to increase these numbers to 17 Mega stores

and 69 TruMarts by 2008. The floor space is expected to be 5 times on

successful expansion. The FHPC (Food & Personal Care) business is volume

driven while the Lifestyle store is a margin driven business.

Piramyd Retail plans to increase the contribution of private labels from existing

7% to 18-20% of the revenues by 2010. Gross margins from private labels are

over 40% and hence the company is planning to increase this business.

Most of the stores are on the lease format and the company is prone to higher

lease rentals due to the overall increase in real estate prices. This may bring the

profit levels down substantially. Piramyd Retail did have a first mover advantage

in many locations but it has actually failed to capitalise over this advantage.

Its competitors like Pantaloon, Shoppers Stop and Trent gained larger benefits of

their far more aggressive business & marketing strategy in the retail space.

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5. Subiksha

The Chennai based Subiksha grocery chain runs around 200 outlets all over the

country and its current turnover stands at Rs 224 crores. Their target customer isthe middle income value conscious buyers. The main aim of Subiksha is to offer

a functional and transactional shopping experience.

This retail chain has no qualms and spends almost no money on creating a

pleasant shopping experience, and all stores are non-air conditioned. There is no

false roofing or sparkling vitrified tiles on the floor. A few years ago, Subiksha did

not even offer shoppers self service. The customer had to place an order at a

computerized teller and the goods were billed and delivered after cash is

collected.

Customers had to bring their own carrybags or pay to buy them from the store.

Subiksha even attempted to charge the customers for home delivery. However,

now Subiksha has slightly tweaked their business model in order to create a

better appeal to customers who were defecting to the competitors. The store

formats are still small and non-airconditioned. But customers have the option to

pick from shelf spaces.

They also get shopping bags and free home delivery. But the selling USP(unique

selling proposition) remains the same --- Subiksha tries to be as close to the

customer as possible and offers the lowest price and huge savings in comparison

to competitors. Its slogan happens to be --- bachat mera adhikar hain (saving is

my fundamental right).

6. RPG Spencer

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RPGs Spencer presently has 125 stores across 25 cities covering a retail trading

area of half a million square feet and with a clientele of 3 million customers a

month. Spencer's has a national footprint with seven hypermarkets, three

supermarkets and 70 daily use outlets, called Dailies.

All the newly opened Spencer's stores stock every conceivable product that is

required by a household on a daily basis.

At Spencer's Daily shoppers can get fresh fruits, vegetables, fast-moving

consumer goods, household items, groceries, with regular offers and discounts.

Spencer's outlets are divided in to three retail formats. These are, Spencer's

Hyper, the over 25,000-sq ft hypermarkets stocking over 25,000 items.

The 8,000sq ft to 15,000-sq ft mini hyper stores, branded as Spencer's Super

and the daily purchase 4,000-sq ft to 7,000-sq ft Spencer's Daily for groceries,

fresh food, chilled and frozen products, bakery and weekly top up shopping.

7. Reliance Retail

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On June 26, 2006, Mukesh Ambani, Chairman and Managing Director, Reliance

Industries Limited, announced a Rs 25,000-crore investment in the retail sector.

Reliance Retail started its retail operation with Reliance Fresh, a grocery store

that sells vegetables, fruits, personal care items and other food products. Soon,these retail outlets will also be selling apparel and footwear, lifestyle and home

improvement products, electronic goods and farm implements and inputs.

They will also offer products and services in energy, travel, health and

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