Retailing is not a rocket science, neither it's walk-in-the-park. In this presentation, I have tried to cover comprehensive roll-out strategies to be implemented for the successful launch of a Supermarket. Note: This presentation has a "Date Stamp - April 2014"

1. RAHUL GUHATHAKURTA
COMPREHENSIVE ROLL-OUT STRATEGIES FOR A SUPERMARKET CHAIN
DECODING
RETAIL
START-UP
DATE STAMP: APRIL 2014

2. SUPERMARKETS VALUEMARTS
RETAIL FORMATS
COMPANY OWNED MODEL FRANCHISE MODEL
(10,000 – 20,000 Sq. Feet) (1,500 – 5,000 Sq. Feet)

3. SUPERMARKET LOCATION ADVANTAGES & LEASE ANALYSIS
MALL - A
XXXX/- /
Sq.ft
MALL – B
YYYY/-
Sq.Ft
KOBA Cr.
IIT-G
PALDI
ONGC
SABARMATI
TAPOVAN Cr.
ASHRAM RD.
METRO
LINE

4. PRODUCE FROZEN PRODUCE
DAIRY
VEG VEG VEG
VEG VEG VEG
PRODUCE PRODUCE
FRUITS
FRUITS
STAPLE-FOOD
STAPLE-FOOD
STAPLE-FOOD
STAPLE-FOOD
STAPLE-FOOD
STAPLE-FOOD
STAPLE-FOOD
HOT OFFER HOT OFFER
HOTOFFERHOTOFFER
STAPLE - FOOD
PHASE 1 : GROUND FLOOR – 10,000 Sq. Ft.
STAPLE - FOOD
STAPLE-FOOD
POS
POS
POS
POS
HOT OFFER
HOT
OFFER
PHARMACY
POS
POSTOILETERIES
TOILETERIES
CS
TROLLEY BAYTROLLEY BAY
TROLLEYBAYTROLLEYBAY

5. MALE APPARELS
FEMALE APPARELS
PHASE 2: 1st FLOOR – 10,000 Sq. Ft.
ELECTRONICS / WHITE GOODS
POS
BRANDED APPARELSTRIAL
TRIAL
POS
TROLLEYBAY
(If applicable…)

6. FOLLOW FORECASTED TIMELINE
Mid-20X1 Early -20X2 Mid-20X2 Early -20X3 Mid-20X3
Oct 20X1 –
Opening of 1st
Store (Phase 1)
Oct 20X2 – To
Cross BEP
Milestone at 1st
Store
Working on VMI –
Vendor Managed
Inventory System
Integrating Store
Level Inventory
System
Jan 20X3 –
Opening of 2nd
Store (Phase 1)
To reach BEP at early stage and to make profits, we have to cut costs aggressively and
focus on store-level profitability and supply chain issues.

7. GROUP CATEGORY CLASSIFICATION
STAPLE GOODS
(FOOD, BEVERAGES ,
FROZEN, ETC.)
CONVINIENCE GOODS
(COSMETICS, DETERGENTS,
OTC, SKINCARE, ETC.)
PHARMACYBAKERY
FRESH FARM
PRODUCE
HOME-CARE
ACCESSORIES

8. Step-by-Step Roll Out to Store Strategy
Store
Positioning
Category Mix
Financials by
Size Grade
Space & Fixture
Allocation
A & B
Catchment
Allocation
Roll-Out to
StoreBUDGET
Local Characteristics, Assortment
Guidelines of Category Mix & Margin
Comparative Category Margins
Sales Per Square Feet Target & Standard Fixture List
Consumer Decision Tree

9. PLANOGRAM METHODOLOGIES - 1
LESS
EXPENSIVE
MORE
EXPENSIVE
SUPER
PREMIUM
PREMIUM
PREMIUM
MID PRICE
VALUE/BULK

10. PLANOGRAM METHODOLOGIES - 2

11. PLANOGRAM METHODOLOGIES - 3

12. EVOLVING MERCHANDISE MIX
Merchandising
Techniques
Product
Items /
Brands
Product
Line /
Category
Development
Expansion
Modification
(Addition /
Deletion)

13. VENDOR DEVELOPMENT CLASSIFICATION
Vendor Classes Description Attributes
Vendor Class A Frequent Buying in Large Quantity HIGHLY TRUSTED
Vendor Class B Semi-Frequent Buying in Large Quantity TRUSTED
Vendor Class C Substitute Buying in Medium Quantity TRUSTED
Vendor Class D Very Less Buying in Small Quantity TRIAL PURPOSE
Vendor Class E Dissatisfaction Encountered NOT TRUSTED/
BLACK-LISTED
Trade Discount
Quantity Discount
Promotional Discount
Seasonal Discount
Cash Discount
Delivery Terms
Basis of
Vendor
Negotiations
“VENDOR PAYMENT
TERMS INCLUDES – 35
DAYS TO 90 DAYS CREDIT
PERIOD.”

14. INVESTMENT BREAK-UP 1: IT-POS Systems
Sr.
No
Name of Item Model & Manufacturer Unit Price in INR Quantity Net Price in
INR
1 POS Terminal TVS TP – A570 70,885 12 8,50,620
2 Thermal Receipt
Printer
TVS-E- POS RP 3200 12,595 12 1,51,140
3 Customer Pole Display TVS-E PD - VFD220 6,890 12 82,680
4 Cash Drawer TVS-E POS 5,500 12 66,000
5 Barcode Scanner TVS-E BS- L 104 Platina 7,490 12 89,880
6 Barcode Printer TVS-E LP 44 Printer 22,000 4 88,000
7 Computers Any Brand 21,000 6 1,26,000
8 Printers + Fax +
Scanner
Any Brand 18,000 1 18,000
9 Automated Conveyor
Belt + Cashier Desk
Suzhou Yuanda Business
Equipment Co., Ltd.
China (Mainland)
90,000 12 10,80,000
10 Installation - 2,00,000 - 2,00,000
TOTAL (Approx.) 27,52,320
(NOTE: All Cost are mentioned in APPROXIMATE VALUES & Above list is tentative FOR 1 SUPERMARKET ONLY)

15. INVESTMENT BREAK-UP 2: Retail Fixtures
Sr.
No
Name of Item Model & Manufacturer Unit Price in
INR
Quantity Net Price in INR
1 Shelves Adwel Racking System
India
20 SET MOQ =
5,500 / Unit
Depending upon
Shop Floor
-
2 Gondolas Adwel Racking System
India
20 SET MOQ =
5,500 / Unit
Depending upon
Shop Floor
-
3 Refrigerated Shelves India 65,000 –
1,00,000
Depending upon
Square Feet/Lt
-
4 Refrigerated Beverage
(Closed Door)
India 75,000 –
1,00,000
Depending upon
Square Feet/Lt
-
5 Electrical Lightening
System
India - Depending upon
Shop Floor
-
6 HVAC System India - Depending upon
Shop Floor
-
7 Shopping Trolleys Expanda Stand Private
Limited, Chennai
1,000
Negotiable
Depending upon
Footfall Forecast
-
8 Shopping Carts Expanda Stand Private
Limited, Chennai
450 - 600
Negotiable
Depending upon
Footfall Forecast
-
TOTAL (Approx.) 20,00,000 –
30,00,000
(NOTE: All Cost are mentioned in APPROXIMATE VALUES & Above list is tentative FOR 1 SUPERMARKET ONLY)

16. INVESTMENT BREAK UP 3: OPERATING COSTS/EXPENSES
Sr. No Cost Services
1 Manpower Cost Company Payroll Management Team – Store Level, Mid-Level & Seniors
Contract Outsourced Store Merchandising, Cleanliness, Cashier,
Maintenance Staff
2 Utility Cost Water, Electricity, Telecom etc.
3 Security Cost Company Owned Security CCTV Cameras / RFID Detectors
Contract Outsourced Metal Detectors, Hand-Held Scanning Devices etc.
4 Warehousing &
Logistics Cost
Contract Outsourced
5 Property Rental NIL if Company Owned
6 Marketing Cost Quarter-Wise Budget Submission for Management Approval on Yearly Basis
7 Maintenance Cost Variable
A Budget of INR 75,00,000 (75 Lakhs) should be kept for 3 – 6 months for running the operations.
(NOTE: All Cost are mentioned in APPROXIMATE VALUES & Above list is tentative FOR 1 SUPERMARKET ONLY)
Sr. No Cost Services
1 Product
Procurement Cost
Depending on Sales , Vendor Negotiation, Category Addition, Consumer Demand,
Vendor Supply Chain
A Budget of INR 50,00,000 (50 Lakhs) should be kept for 3 – 6 months for the procurement and rotational
payment purpose.

17. SUMMATION OF INVESTMENTS
Sr. No Investment Categories Description Value in INR
1 INVESTMENT BREAK-UP 1 IT-POS Systems 27, 52, 320
2 INVESTMENT BREAK-UP 1 Retail Fixtures 30,00,000
3 INVESTMENT BREAK-UP 3A Operating
Costs/Expenses
75,00,000
INVESTMENT BREAK-UP 3B Product
Procurement Costs
50,00,000
Total 1,82,52,320
i.e.,
INR 1.82 Crores
(NOTE: All Cost are mentioned in APPROXIMATE VALUES & Above list is tentative FOR 1 SUPERMARKET ONLY)

18. RETURN ON INVESTMENT – GOVERNING FACTORS
Sr. No Governing Factors
1 Price Optimization
2 Target Margin Optimization
3 Monitoring Vendor-End Supply Chain Dynamics
4 Store Level Inventory Control
5 Consumer Demand Factors
6 Store Locations and Demographic Factors

19. •Product Listing
•Shelf Renting
•Sales Promotional Activities
Revenue
Cycle 1
•Target Sales Margin
•Pricing Optimization
•Footfall Generation
Revenue
Cycle 2
•Loyalty Programs
•Co-Branding Activities
•Deploying Franchise
Model
Revenue
Cycle 3
SALES
MARKETING

20. ORGANIZATION CHART
BOARD OF DIRECTORS
CEO/HEAD – RETAIL
KEY ACCOUNT
MANAGER
STORE
MANAGER
BUYING
MANAGER
HR/ADMIN
MANAGER
FINANCE
MANAGER
ACCOUNT
EXECUTIVE
CATEGORY
EXECUTIVE
BUYING
EXECUTIVE
FINANCE
EXECUTIVE
HR
EXECUTIVE
MERCHANDISER
TEAM (CONTRACT)
LOGISTICS
EXECUTIVE
LOGISTICS
TEAM
(CONTRACT)
SHOP FLOOR
TEAM (CONTRACT)
HEAD
CASHIER
CASHIER
TEAM (CONTRACT)

21. License Subject Issuing Authority For Retail format
Registration
Certificate
Under Shops &
Establishments Act
Municipality Ward
Office
Supermarket/
Department Store
Trade License Edible Oil, Ready made
ice creams , sweets &
chocolates
Municipality Ward
Office
Supermarket
Dairy License License for cow, buffalo
milk
Public Health Dept.
of Municipality
Supermarket
License for
frozen items
License for Frozen
Items
Frozen Products
Market & Slaughter
Dept. of
Municipality
Supermarket
Store Administration & Facilities Management - Licenses

22. License Subject Issuing Authority For Retail format
License for
rationing
For retail sales of pulses,
food-grains, sugar,etc
Deptt of Civil
Supplies
Supermarket
License for
Weights &
Measures
License for weighing
machines
Inspector-Weights
& Measures
Supermarket
Central Sales
Tax Registration
Registration under Central
Sales Tax
Sales Tax Office Supermarket
VAT / Gujarat
Sales Tax
Registration
Registration under
stipulated section of state
sales Tax Act, 1969
Sales Tax Office, Supermarket
Store Administration & Facilities Management - Licenses

23. MARKETING STRATEGY

24. SPECIAL OFFER PAMPLETS

25. IN-STORE BTL & SALES PROMOTION ACTIVITIES

26. • Big retailers in India have been accumulating losses, mainly because they have been on an
expansion spree. An overall slowdown, rising interest rates, delay in realty projects, cash
crunch and debt trap forced several retailers to shut shops and defer expansion since 2009.
• We should not focus on take-overs and acquisitions, believe in ORGANIC growth by
deploying ONE STORE AT A TIME and build a sustainable RETAIL BRAND.
• A Tier 1 City should be considered as experimental/target city for next 3 financial years.
And, gradually we should move on to Tier-2 from the 4th financial year.
• Being in retail industry, helps us to generate huge customer data on the basis of buying
pattern, consumption pattern, spending pattern which eventually can be used for cross-
selling of other products.
• Inbound FDI in Multi-Brand Retail is in news . We have to take it as a sign to invest and
develop a home grown retail format in Gujarat and get it valuated by a PE firm or Venture
Capitalist Fund after 4-5 Years in Operation. Kindly note, the valuation will totally depend
on the brand equity which we are going to build-up on the given time-frame.
KEY POINTS TO THINK

27. THANK YOU!
OPEN FOR QUESTIONS AND ANSWERS

28. ✔ Brand Management, New Product Development, ATL, BTL, Project Management, Country Intelligence -
International Business, Customer Life Cycle Management, Retail Management, Strategy Consulting.
✔ Global Supply Chain & Logistics Planning & Optimization, Demand Planning, DC Network Set-Up & Planning,
SEZ/FTZ Operations, Product Development & Customization and Vendor Management & Collaboration.
✔ Oracle 11i & R12 Implementation-Supply Chain Management:INV,P2P,Sourcing,iSupplier, iProcurement and
Order Management, SLA, PMI Methodologies, Cross-Functional Dynamics.
✔ Specialties: Expertise in Emerging Markets – India/ UAE & MENA / Russia & CIS/ EU – CEE
Countries Travelled: Switzerland, France, Austria, Turkey, Ukraine, Uzbekistan, Russia, Singapore, Oman & U.A.E
Email: rahulogy@gmail.com
Mob: +91-9978066443
ABOUT THE AUTHOR
DATE STAMP: APRIL 2014