1. rELIANCE FRESH

2. EXECUTIVE SUMMARY
Giant corporations like Wal-Mart and Reliance have started to try and take over
the Indian retail sector. The entry of the giant corporateretail in India’s food
market will have direct impact on India’s 650 million farmers and 40 million
people employed in tiny retail. More than 6600 mega stores are planned with
Rs. 40,000 crore by 2011..
Even after recent shutdown of Reliance fresh stores from UP and unwelcoming
vibes from states like Kerala, West Bengal, Orissa and Jharkhand for its retail
format (which was allegedly capturing the unorganized sector and leaving
thousands of self employed people jobless) Reliance was not in any mood to
hamper its 25000 crore plan. Reliance responded with superb strategy in which
it shifted its focus from retailer to being a supplier i.e. targeting hawkers,
vendors, Push cart wheelers instead of customers.
Big retailers like Reliance have huge resources and network which directly
impacted many of the retailers some of whom are planning to quit. In our
sample size of 75 retailers more than 30 agreed to have lost as much as 50% of
their sales.

3. BACKGROUND OF RETAIL
India is a land of retail democracy- hundreds of thousands of weekly haats and
bazaars are located
across the length and breadth of our country by people’s own self-
organizational capacities. Our
streets are bazaars – lively, vibrant, safe and the source of livelihood for
millions. India has the
highest shop density in the world, with 11 outlets per 1000 people. This does
not include the village haats.
Our retail democracyis characterized by
1. High levels of livelihoods in retail with nearly 40 million employed which
accounts for 8%
of the employment and 4% of the entire population.
2. High levels of self - organization.
3. Low capital input
4. High levels of decentralization
Retail in India has started with the conceptof weekly markets, where all the
traders gather at one
big place to sell their products every week. The people come to these weekly
markets to buy the
household items for the next one week. Village fairs and melas were also
common as it had more of an entertainment value. Once the people started
getting busywith their lives and when they turned entrepreneurial, there
emerged the mom and pop shops and the kiranas in the neighborhood. After
independence, came into existence the system of Public distribution of foods
through the ration shops, where food grains, sugar and oil for the daily
consumption were distributed at subsidized rates through the government ration
shops. The modern corporateretail formats are of the exclusive brand outlets,
hypermarkets and supermarkets, departmental stores and shopping malls. But
still the Indian consumer depends on the self-organized retail shops for their
daily needs.
This is largely due to the excellent food retailing system that was established by
the kirana (mom and-pop)stores that continue meet with all the requirements of
retail requirements albeit without
the convenience of the shopping as provided by the retail chains. The
Hawkers/lari galla vendors
and the local kiranas are the two main forms of unorganized retail in the
country, which almost
account for 97% of the total retail trade.

4. Giant corporations like Wal-Mart and Reliance have started to try and take over
the Indian retail
sector. Currently the value of the retail market is estimated at around $ 270
billion with a growth
rate of 5.7 per cent per annum according to the Indian retail report. The size of
small retail is big, the size of big retail is small, a mere Rs. 250 billion in 2004
or 3% and Rs. 485 billion or 4.7% per cent of the retail market in 2006.
However, the large scale corporateretail is projected to grow at the rate of 28%
to 30% per annum, reaching Rs. 1000 billion or $ 70 billion by 2010 from the
current size of US $ 8.7 billion. The tenfold increase in corporate retail will be
at the costof small scale retail, which employs nearly 10% of India’s
population.
The strategy here is to define the small scale self-organized retail as
“unorganized” and the large
scale corporateretail as “organized”. The real difference is however not
unorganized vs organized. But it is “self-organized vs. corporate”.

5. Introduction
Reliance Fresh is the convenience store format which a part of Reliance Retail
limited, a fully subsidiary of Reliance Industries Limited. Reliance plans to
invest Rs 25000 crores in the next 4 years in their retail division.
RRL launched its first store in Hyderabad in November 2006; major focus was
on selling fresh fruits and vegetables at lower prices by eliminating the middle
men and intermediaries. Now it has more than 560 reliance fresh outlets across
the country of which 117 are in Delhi and plans to increase this number to 784
to have pan-india presence by 2011. These stores sell fresh fruits and
vegetables, staples, groceries, fresh juice bars dairy products and non vegetarian
products.
Stores, size varying from 2000-4000 sq ft, are located in the radius of 1-2 km of
each other providing a good coverage of the area. Reliance retail has decided to
reduce its exposure to fruit and vegetable business and position itself as a pure
play super market and will focus on categories like food, auto accessories,
FMCG, with food accounting for most of its business.
High quality products are offered to the customers having better shelf life and
more consistent quality. Company has expanded its supply chain management
and it is capable of handling it rapidly growing stores network effectively and
efficiently.
When stores were launched, there was some initial problems postlaunch due to
circumstances prevailing in West Bengal, Orissa and U.P.

6. “FARM TO FORK”
The Reliance retail company sources say it is setting aside Rs 50,000
crore to build its farm-to-fork linkage. Reliance has drawn up plans for a
presence in 784 towns and 6,000 mandi (wholesale market) towns with
1,600 rural business hubs to service these. It has already rolled out 177
Reliance Fresh stores across major towns in 11 states. According to a
company report, RIL is targeting a turnover of Rs 40,000 crore in the next
few years.
TRADITIONAL MODELOF RETAIL RELIANCE “FARM
TO FORK”

7. Structure of Channel
Reliance started its retail operations of Reliance Fresh stores with
following supply chain model. Procuring directly from the farmers and
operating with moderate margin but mass
Selling was key to Reliance fresh operation for first few months. The
following figure depicts the first Reliance fresh model :
RELIANCE FRESH
MODEL1
But things always don’tturn out to be the same as planned. Opposition against
Reliance fresh outlets in U.P sooninterrupted the momentum .Reliance wished
to go with. Bowing to mass opposition from local shopkeepers, the company
closed down 20 Reliance Fresh stores in Noida and Ghaziabad. A company
insider said that Reliance Retail was being forced to exit UP owing to what he
described as the “vindictive approach”of the state government . Within the
month company started operations in Lucknow and Varanasi with 14 stores,
RELIANCE OWN
LOGISTICS
RELIANCE
FRESH
OUTLETS
RELIANCE
FRESH
OUTLETS
RELIANCE
FRESH
OUTLETS
PROCESSING
UNIT/POINT
COLLECTIO
N
POINT/UNI
T
Farmers Own Transportation
Reliance own Logistics Reliance own Logistics
Farmers Own Transportation
RF
RF
FARMERS
CATEGORY
1
FARMERS
CATEGORY
2
FARMERS
CATEGORY
3

8. stores had to be soonclosed down following violent protests by local traders.
After the protests, the state government instructed all standalone food & grocery
stores run by corporates to close down. Similar things followed in NCR and
Ghaziabad. The strategic importance of UP for a large-scale retailer like
Reliance was not limited to it being a large consumer market. The state is
extremely important from the sourcing point of view as well. The Gangetic
plain in the state is considered to be one of the most fertile agricultural belts in
the country. Reliance’s food & grocery business was in the line of fire, because
of the popular perception of Reliance being the most ‘powerful’ business
conglomerate in the country. This is evident from the fact that widespread
political protests to corporateparticipation in retail started only after Reliance
announced its roll-out plans. Companies like Kishore Biyani’s Future group,
Subhiksha and Spencer’s have had operations in this format long before without
encountering major problems. Moreover, the positioning of the Reliance Fresh
format (small convenience stores)puts it in direct competition not only with
neighbourhood kirana stores, but also with small fruit and vegetable vendors. At
this point of time future and ambitions of 25000 Crore Reliance retail started
falling under clouds.
UPDATED POLICY
From grocery, Reliance Retail plans shift to supply :
Reliance Retail was faced with massive opposition from the trading
community.
But like every great visionary Reliance had a prepared back-up, and this time
it was much more powerful than the earlier one, throwing solutions to every
previous dilemma .
In a dramatic shift, it decided to turn into a trader itself. It is entering the
food-trading business as part of a major restructuring of its food and grocery
initiative.
The split has occurred because Reliance has realised that there is money to
be made, may be more, in simple commodity trading, especially with food
prices likely to go through the roof next year. As a result of this
restructuring, Reliance Retail is setting up shop in mandis to sell fruits,
vegetables and staples. It would thus be able to profit from commodity
trading without worrying about the steep overheads and discounts that tied
its hands in its avatar as Reliance Fresh. It would also allow the company to
sell to a wide range of customers, including wholesalers, other traders, and
retailers. A sourcesaid the company has already signed up with Spencer
retail chains to supply cut fruits and vegetables. Till now, the Reliance
supply chain was dedicated to meeting the needs of Reliance Fresh shops.

9. WHOLESALE TRADING (WST) : Reliance formalized its second
supply chain model to shift itself from grocery retailer to grocery supplier by
focusing and establishing itself in Mandi’s.
STEPS IN WTS MODEL :
1) Reliance has owned farms on contract basis for production of specific
crop which is
decided after extensive research depending on
SOIL CONDITIONS,
CLIMATE CONDITIONS,
RETURN OVER COSTS INCURRED.
So as to yield best possibleresults.
2) Different vegetables and fruits from suchfarms are collected through
reliance ownlogistics and brought to collection Processingcenters where
quality check and other required processing is done.
In processingcenters workers wearing balaclavas, woolen trousers and
bulky jackets work inside a room kept at a constant 3oC, peeling and
chopping vegetables, spinning them dry and then heaping them in small
plastic packets before placing them in plastic transport crates. At the other
end of the 5,000-sq-m warehouse, men unload crates of fruits from a truck
pulled up to a spotless loading dock. A quality-control expert samples every
tenth crate; if the fruits are good a team will ready them for delivery within
hours to Reliance fresh stores around different places like U.P and as far
away as Hyderabad and even Mumbai (formerly Bombay). If they are not,
workers will inspect the entire shipment and discard anything below
standard.
3) Merchandise from these collection processing centers are collected and
loaded for Wholesale mandi’s. As this merchandise is to be made
available by 4 A.M in morning
thus deliveries in trucks are sent at time depending upon:
TRANSIT TIME. – time required to reach destination i.e mandi’s.

10. MARGIN TIME. – time period between a truck reaching mandi and then
Unloads. Can be 2 to 3 hours.
LOADING AND UNLOADING TIME .
4) From mandi’s where the trucks have been unloaded, roadside vendors and
pull carters Buy fruits and vegetables to supply in households.
5) In case still some vegetables and fruits are not sold reliance logistics own
Transportation send them to reliance fresh stores.
Diagrammatical representation of above said WST model is give on next
page.
WHOLESALE TRADING MODEL-2.
Reliance Own Logistics
RELIANCE OWN
LOGISTICS
RELIANCE
FRESH
OUTLET
RELIANCE
FRESH
OUTLETS
RELIANCE
FRESH
OUTLETS
PROCESSING
UNIT/POINT
FARMERS
Reliance own Logistics Reliance own Logistics
Reliance Own Logistics
FARMHOUS
E ON
CONTRACT
FARMHOUS
E ON
CONTRACT
WHOLESA
LE
MANDI’S
WHOLESA
LE
MANDI’S
WHOLESA
LE
MANDI’S
Cold Trucks,
TATA 407,408,LP

11. Structure of Channel
 The vegetables are collected in villages from farmers directly.
 They are submitted to Collection Centres (CC) like Baktawar Pur,
Khewrada, Hapur, Patodi, Panipat,etc.
 Payment and quality checks are done in collection centres.
 From CC they are transferred to Distribution Centres (DC) via Reliance
own logistical units. Kundli is the DC for Delhi/NCR.
 If the capacity is not fulfilled by the collection centre then National
sourcing is used
 This leads us to the next and final step in the process,i.e. the local
Reliance Fresh stores.
National
Sourcing
National
Sourcing

12. The order for new vegetables has to be placed one day before. Till evening the
stockis in distribution centres. At night it is transhipped to the local store. So
there is a delay of one day from farm to the stores which are 113 in New Delhi.
The distribution centre and the localstores are rent based.
Daily rates are monitored. The farmers are paid less than the prevailing rates in
mandi. If the requirement is not met through farmers then the additional goods
are brought directly from mandi at a 3-4% cheaper rate from the usual mandi
rate.
The total volume entering in NCR is at average around 100 tons, but due to
rising prices of vegetables, the consumption has fallen. This has made the
volume fall to 70-80 tons. Almost 65% of the volume bought is from Collection
Centres and warehouses, the rest 35 % is procured from mandis.

13. Movement of Goods (Logistics)
Reliance itself pays for all logistics from the collection centre to the retail
stores. Reliance earlier has a logistics company which used to provide man
power as well as transportation of goods. But now the logistics company is no
longer in place. Some of the company owned trucks of logistics company are
used for transportation along with other trucks on rent based system from a third
party vendor.

14. Members and their Roles
Farmers:The farmers harvest the crop and bring it to the collection centre.
They save on the transportation costthey would incur in taking the vegetables
to the mandi.
CollectionCentre: One Reliance authorized personis in charge of collection
centre. He inspects the quality and takes in the vegetables. He is also
responsible for payment of the farmers. He ensures the loading of all vegetables
in the trucks which are sent to the DC.
NationalSourcing: In order to provide a constant supply of all perishable
vegetables warehouses have been bought where goods are kept in cold storage.
Whenever there is a shortage in supply from any region then, these warehouses
takeover and start supplying goods. Eg. Tomatoes are stored in Nasik, Ratlam,
Jaipur; Potatoes in Agra and Shahbad. This gives Reliance a competitive edge.
It also ensures that they buy at the cheapest rate and sell it out when the rates are
considerable higher.
Mandi: A team of two people is situated at the mandi. These teams are
responsible for constantly monitoring the rates and communicating the same to
the head office. If there is an urgent need which cannot be fulfilled by the
collection centre then reliance purchases the supply directly from mandi but at a
rate which is 3%-4% less than the actual mandi rate.
Distribution Centre: The distribution centre receives the vegetables and does a
thorough quality check. They prepare the vegetables for the retail stores and
also ship the vegetables depending on the requirement for each store.
RetailStores: They are just responsible for receiving and checking the quantity
of vegetables arriving each night. Then they put up all good vegetables on
display for customers.

15. Quantum of Volumes
The total volumes procured per day is currently about 70-80 tonnes. This is the
figure for last two months. Due to rise in prices the volume has dropped as it
was earlier about 100 tonnes per day.
Management Policies
If the store owners are able to reach their target then there is a monetary award
and recognition. It is worked on monthly percentage increase in the sales. The
customers are offered services like home delivery on orders exceeding Rs 500

16. DAILY ACTIVITIES OF RELIANCE FRESH
Reliance Fresh was blessing in disguise of a store when it opened. The quality
of fruits and vegetables was amazing. So fresh, so photo-like! We were happily
surprised. It made shopping for groceries and fruits and vegetables not only
convenient but also a fun activity. This is because Relience fresh perform
certain daily activity which are as follows:
1. Milk Indenting
2. Milk Receivable
3. Morning Brietive
4. Job Allocation
5. Store Performance(Morning)
6. Bread Indenting
7. Update Reports
8. St.Performence(Afternoon)
9. Dump
10. Mark down
11. GRN Deposit
12. Footfall Report
Besides this Relience fresh also perform other activities like:
1. Home retailing
2. Catalogue retailing
3. Direct respond retailing
4. Automatic Vending
5. Electronic retailing

17. FUTURE PLAN OF RELIANCE FRES
 Plans to invest Rs 25000 Crore in next 4 year in their retail division
Every Indian Consumer
 Train students and housewives – Customer care & Quality service – Part
time job
 New format of food and café – Reliance food
 Private label sale – Kirana store
 Pharmacy retail store
 6000 outlets – 784 cities
 Launch soaps, detergents, cosmetics and non FMCG products – Private
label
RECOMENDATIONS
COMMUNICATION:
 Based on our observation we found that reliance fresh is not able to make
an advertisement properly as compare to big bazaar or other retail store
which is its competitor. So company should make a properteam to let the
people aware about their schemes and offers being given by reliance
fresh.
 Company should increase the number of counter so that it may minimize
the queue of the customers.
 Company should acquire more and more skilled people so that it may
satisfy their customer in all areas.
PROMTNESS IN SERVICES:
 Reliance fresh should pay kind attention towards the existing customer
and try to provide them quick response in the sphere of services so that
they become loyal.

18. BEHAVIOR AND COMMITMENT
 Behavior and commitments of sales man towards the dry outlets should
be improved
 .Expand service
 Give training to staff
 Improve inventory control
CONCLUSION
It was a pleasant experience to have a survey in a Reliance fresh It has given me
an opportunity to know all dimensions of the market and how to tackle
problems of it I have learned various functions carried out at all the level of
organization especially of middle level and lower level. After a rigorous period
of our survey we come to know that how practical knowledge is different from
the theoretical concepts.

19. BIBLOGRAPHY
www.google.com
www.wikipedia.com
www.reliencefresh.info
Marketing Management by C.B.Gupta