Nilanchal
Sahu
Roll No : 510922671
Mall Management
Code No: - ML0008
MBA 4th Semester
Assignment Set- 1
Q-1.Discuss the favorable factors and the challenges of
retail penetration in India?
We define Mall Management as the process of bringing a very large range
& variety of Consumer Products from the Manufacturers & Distributors
across the globe into a common Commercial Area for Display & sale
directly to consumers.
We are using the top down approach starting with the GDP and market
size vis a vis Global Markets and the size of various industries.
· GDP Growth
· Changing Demography
· India: A service Economy
· Income: Rs10, 000+ per month
· How Low is Low per Capita Income
India is the fourth largest economy in World with year 2000 GDP at USD
1797 bn (PPP wise). In absolute terms India stands at 17th position (USD
360 bn). But with the high GDP growth rate India will soon surpass
countries like Netherlands, Australia, and South Korea and will rival
Mexico. India’s GDP CAGR will be 9.6%, one of the highest in world. With
the slowdown in American and European economies the growth only
becomes more pronounced.
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Nilanchal
Sahu
Roll No : 510922671
The country on the other hand stands as an emerging market at the 11 th
position thanks to old socialist policies. The above model shows the
country’s standing on various parameters.
Lower per capita incomes are not ‘The Hindrance’ keeping the Indians
chase from the invasions of Malls. China with above 20% organized
retailing market share does not have much higher retail sales then India.
1.3.2 The genesis
India has a population of 1.2 bn with 75% of people living in villages and
small towns. With agriculture sector contributing 26.7% to the GDP the
sector is the biggest employer. This makes the country highly fragmented
with 6 mn villages. This decentralized character has given birth to highly
efficient small store culture. India has more then 6 mn small stores,
highest in the world, and employs 20% (estimates vary according to
source) of the Economically Active Population. The adjoining tables shows
the number and the really small size of these neighborhood stores with
54% stores having annual turnover of less then USD 452.
1.3.2.1 What makes them tick?
Small stores have the underlying strengths which is difficult if not
impossible to overcome.
· Spread and accessibility
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Nilanchal
Sahu
Roll No : 510922671
· Customer Friendly
· Low expectations
· Employment
1.3.3 Division of Malls in India
· Apparel retailers: Raymond’s, Madura Garments
· Grocers: Food world
· Discount Stores: Big Bazaar, Giant
· Mall developers and Managers: Crossroads, Spencer, and Ansal Plaza
· Pharmacy: Subhiksha
· Pizza Chains: Dominos, Pizza Corner
· Coffee Chains: Barista, Café Coffee
· Music Stores: Planet M, Grooves
· Furniture Retailers: Gautier, Durian
Q.2.What do you mean by Mall management? Describe the mall
management functionality?
It deals with the entire supply-demand pattern of an item through all
levels of the hierarchy.
The Mall Management System and Action Messaging
Action Messaging
· Order tracking, with its simultaneous creation of action messages (AM),
is not a part of the Mall Management system. This feature interlinks, in
real-time, the requirements and the quantities that could cover them,
whenever a new requirement or replenishment order is created or
changed.
· If, for example, the user enters or changes a sales order, order tracking
will instantly search for an appropriate supply to cover the demand. This
could be from inventory or an expected replenishment order (such as a
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Nilanchal
Sahu
Roll No : 510922671
purchase or production order). When a supply source is found, a link is
created between the demand and the supply. If all of the demand cannot
be covered, order tracking will create an action message suggesting what
the user could do to address the situation.
· AM are stored in a separate table. The user can retrieve and view them
in the Mall Management worksheet by running the Get Action Messages
batch job.
· AM offers a quick response but less comprehensive plan than the Mall
Management system.
Differentiating between Mall Management and Action Messaging
At a quick glance, it may be difficult to differentiate between Mall
Management and action messaging. Both features display their output in
the Mall Management worksheet. The output – suggested actions for the
user to take – is similar but the way this output is produced differs.
· The Mall Management system deals with the entire supply-demand
pattern of an item through all levels of the hierarchy, whereas order
tracking only addresses the situation of the order that activated it.
· When balancing demand and supply, the Mall Management system
creates links in a user-activated batch mode, whereas order tracking
creates the links automatically and on the fly whenever the user enters a
demand or a supply in the program (for example, a sales or purchase
order).
Order tracking establishes links between demand and supply as data is
entered, on a first-come basis. This may lead to some disorder in
priorities. For example, a sales order entered first but with a due date
next month may be linked to the supply in inventory, while the next sales
order due tomorrow may cause an action message to create a new
purchase order to cover it.
The Mall Management system, on the other hand, deals with all demand
and supply orders for a particular item, in prioritized order according to
due date. It deletes all links that were created dynamically and
reestablishes them according to due date priority. When the Mall
Management system has run, it has solved all imbalances between
demand and supply. No action messages remain in the Action Message
Entry table, as they have been replaced by the suggestions in the Mall
Management worksheet.
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Nilanchal
Sahu
Roll No : 510922671
3. Write a short note on
(a) Strategy in retail management
The meaning of SCM Check List: Towards this end, to help maintain a
systematic approach, it is desirable to have a check list outlining various
steps.
4.3 Strategy in Retail Sector
4.3.1 Build value understanding / design customer value
Value is the key term in business marketing.
· Profitable growth is founded on the ability to deliver value that
customers can only get at a competitive advantage.
A problem: Over time we have trained both our customers and our sales
force to ignore value and buy only on price.
Best practices for the customers
· Understand how the products and services that you sell generate value
for customers (revenues or cost savings), noting particularly the
differences between the value delivered by you and by the competition.
· Sale value delivered, not features and grow markets, by educating more
customers on the value that you deliver.
· Segment the market for pricing by offering different product/service
bundles at different price levels to reflect differences in the value that are
delivered.
Best practices for competition
· Identify current/potential competitive advantages and capabilities that
leverage those advantages.
· Target customers that best value your capabilities and focus resource
investments to those customers for profitable growth.
· Anticipate and plan for changes in competitor and customer behavior
that could threaten the competitive position in target segments.
· Collect and communicate competitive information to allow management
of competitive threats and minimize the impact of competitive
confrontations.
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Nilanchal
Sahu
Roll No : 510922671
· Evaluate your competitive success by the ability to grow profits, not
market share.
Economic value estimation (EVE)
· Determine the price of the competitive alternative.
· Determine the money value to customer of product’s unique benefits.
· Subtract the cost the customer incurs with using the product.
· The net figure is the total economic value of your product.
Implement fences into the product offering that allow the customer to pay
a higher/lower price for the product depending upon the amount of value
contained in the product. Adding fences produces a more durable
segmentation of customers.
(b) Good supply chain practices.
In good supply chain practices, errors and discrepancies are rooted out as
early as possible and corrected to ensure the rest of the supply chain is
not interrupted. For example, when a manufacturer short-ships a purchase
order, this causes errors and discrepancies in the customer’s receiving
system, warehouse management system, sales forecast / allocation
system, and accounting system. As such, people must be involved in
correcting the errors caused in each of these systems, driving up the cost
of doing business and creating inefficiencies and shortages.
Conversely, the customer should work with their suppliers to provide
forecasts that are accurate hopefully to the point of being qualified as
blanket purchase orders, and provide sufficient lead-time to the
manufacturer to make and ship the goods within the manufacturer’s
capacity.
However, the manufacturer must work with their own supply chain
partners – the manufacturer’s raw material and component suppliers – to
ensure sufficient quantities of quality materials and parts are available to
meet the manufacturing schedule. Any broken link the in the supply chain
causes disruptions throughout the rest of the chain!
The earlier in the supply chain errors and problems are caught and
corrected, the smoother and more efficient the whole supply chain will be,
and this will lead to better relationships between manufacturers and their
customers. The end result is that consumers will have readily available
the goods they desire to purchase when they walk into a Mall store or
shop online.
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Nilanchal
Sahu
Roll No : 510922671
4.4.1 Prior to SCM Testing
The manufacturer and the customer will verify the sending and receiving,
and use of, the electronic documents provided by the SCM.
For example, one customer may require a purchase order
acknowledgement for each purchase order sent to the manufacturer.
Another customer, however, may not wish to receive purchase order
acknowledgements. Further, a purchase order acknowledgement may
only be required by a customer for each purchase order change the
customer sends.
In another example, the customer may require the advance ship notice to
be sent no later than 4 hours after the truck has left the manufacturer.
This will help to ensure the customer receives the advance ship notice in
enough time to process the information well before the goods actually
reach the customer’s distribution center or store.
Therefore, prior to testing, the manufacturer and customer must both
agree as to the use of, and when to use, each electronic document
supported by the SCM. These guidelines should be documented and
included as part of this documentation.
Data Entry and Data Validity
The SCM does not validate data during entry aside from certain data field
formats (i.e. dates) and specific data fields that are dependent upon one
another as determined by their use and definition.
The SCM therefore does not, and cannot, correct data entry errors. If a
purchase order number is entered incorrectly, the SCM has no way of
knowing this. If an item code is entered incorrectly, the manufacturer may
ship the wrong item or will note an item code that makes no sense and
contact the customer. If the item quantity is entered incorrectly, the
customer may end up with a shipment of 100 items, not the desired 10
items.
It is critically important that personnel at both the manufacturer and the
customer be dedicated to ensuring 100% error-free data entry when using
the SCM.
