Dissertation FDI clearances in retailing, the changing consumer

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Project Report 1st Draft – 2017-2018.




title –

and Challenges in Organized Retail of Fruits and Vegetables in Pune City

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by –

Chavan (16020242040)






the guidance of –

Shubhangi Salokhe (Professor, Agribusiness, SIIB)



1. Acknowledgement
………………………………………………………   3

2. Introduction ……………………………………………………………    4

3. Objectives of Study……………………………………………………..    7 

4. Methodology …………………………………………………………..    15  

5. Current Scenario ………………………………………………………   30

6. Questionnaires
………………………………………………….………   31

7. References and
Bibliography……………………………………. …..    39



















The organised retail
business in its new ‘avatar’ began its growth story in the country only after
the liberalisation of the economic policies. An USP of the new retail format,
especially the malls, as a one-stop shop with the added advantage of
entertainment and food courts, aim at making shopping an enjoyable experience
for the discerning consumer-family. Initially, this industry showed a great
promise, making rapid strides along its growth path but with the global
recession of 2008 impacting the domestic retail scenario, a few major players
have downed the shutters. However, the organised retail market appears to be
poised on a phase of consolidation with mergers and acquisitions. The outcome
of the policy debate on FDI in multi-brand retail could impact the growth
trajectory of the industry.

Retailing has been
defined as business activities involved in selling goods and services to consumers
for their personal, family or household use (Berman and Evans, 2001). Organized
retail is nothing but a retail place all the items are segregated and brought
under one roof, unlike the unorganized retail where there are different things
are sold in different shops. It also aims to bring maximum of different brands
making the same type of product together.

‘Agro Products’
embraces a broad all-inclusive category of products related to AGRICULTURE. It
includes a comprehensive range of raw and finished goods under the
classifications of plants, animals and other life forms. The term ‘agro’ has
stemmed from the Greek word ‘agros’ meaning field, which has led to its current
usage meaning anything that falls under the ‘agricultural’ category. The
Organised retail segment in India is expected to witness higher growth going
forward due to the FDI clearances in retailing, the changing consumer needs,
rise in young (15-49 years) and working women population, and increase in
nuclear families among others. It is estimated that the young population is
likely to constitute 53.0% of the total population in 2020 and 46.5% of the
population in 2050 – much higher than countries like the US, the UK, Germany,
China etc. Today retailing is largest contributing sector to country’s GDP i.e.
10% as compared to 8% in China, 6% in Brazi








of Study


1.     To
understand current scenario of organized and unorganized retail of fruits and


2.     To
analyze major issues in organized retail of fruits and vegetables


3.     To
understand consumer awareness regarding organized and unorganized retail of

And vegetables


4.     To
understand consumer perception and behavior regarding organized and unorganized
retail of fruits and vegetables



















1.     Secondary
data from online and authentic literatures


2.     Primary
research of consumers through survey        


Research Design
– Descriptive Research

Sampling Design –

Sampling Frame – Consumer who purchase from both
organised and unorganised retailers.

Sampling Unit – Consumer from different age, group,
gender, occupation, income level and   educational

Sampling Size – 100 customer


Data Collection Methods –

Primary Data – Survey Methods

Secondary data – Data will be collected from
respondents and journals and from previous study related to the retailing











Research Analysis

Scenario of Retail

study brings out several findings that have serious policy implications. The
organised retail which accounts for 5 per cent of the total retail trade is
poised to grow at an annual rate of around 11 per cent and is likely to touch
business levels of 53,000 billion by 2020. Agri-food retailing accounts for 18
per cent of the organised retail today and is likely to have a lower share
(12%) by 2020. The study has identified a few major impediments, especially
structural, hampering the growth of organised retail. Direct sourcing by
retailers from farmers is less prevalent though it is most desirable and in the
interest of all stakeholders.

in India

Retail Sector is the largest sector in India after agriculture, accounting for
over 10 per cent of the country’s GDP and around 8 per cent of the employment.
India has the most unorganized retail market in the world. The Indian industry
is divided into organized and unorganized sectors. Organized retailing refers
to trading activities undertaken by licensed retailers, that is, those who are
registered for sales tax, income tax, etc. These include the corporate-backed
hypermarkets and retail chains, and also the privately owned large retail
businesses. Unorganized retailing, on the other hand, refers to the traditional
formats of low-cost retailing, such as the local kirana shops, owner manned
general stores, paan/beedi shops, convenience stores, hand cart and pavement
vendors, etc. In the beginning there were only kirana stores called Mom and Pop
Stores, the Friendly neighborhood stores selling every day needs. Most
retailers of the market have their shop in the front and house at the back. All
Indian households have traditionally enjoyed the convenience of calling up the
corner grocery “kirana” store, which is all too familiar with their
brand preferences, offers credit, and applies flexible conditions for product
returns and exchange. And while mall based shopping formats are gaining
popularity in most cities today, the price-sensitive Indian shopper has reached
out to stores such as Big Bazaar mainly for the steep discounts and bulk
prices. Retail chains such as Reliance Fresh and More have reportedly closed
down operations in some of their locations, because after the initial novelty
faded off, most shoppers preferred the convenience and access offered by the
local kirana store. So how would these Western multi-brand stores such as
Wal-Mart and Carrefour strategies their entry into the country and gain access
to the average Indian household? Wal-Mart has already entered the market
through its partnership with Bharti, and gained opportunity for some early
observations. The company’s entry into China will also have brought some
understanding on catering to a large, diverse market, and perspectives on
buying behaviour in Asian households. Carrefour on the other hand has launched
its wholesale cash and carry operations in the country for professional
businesses and retailers, and will now need to focus more on understanding the
individual Indian customer

For Study:

retail industry plays an important role for the economic growth of our country.
Indian retail sector or industry is one of the sunrise sectors with huge growth
potential. Retailing is the largest private industry in India. In year 2001 the
amount of FDI in India came to $42.3 billion, in next year 2002 it figure to
$54.1 billion this figures stood at $75.4 in year 2003 and $113 billion in year
2004 which clearly denotes that the flow of foreign direct investment has grown
at a very fast pace. According to the investment Commission of India, the
retail sector is expected to grow almost three times its current levels to $660
billion by 2015. (Dr. D. D. Bedia et al. Aug 2017)


Value chain &
retailing of fresh vegetables & fruits

the present era of globalization agriculture is facing some new challenges
which relates to linking farmers to modern supply chains, lack of technical
knowledge to meet stringent quality and food safety standards, export
competitiveness due to sanitary phyto-sanitary measures.( Singh Rakesh,
Banaras University, 2009)

Food retail &
retail supply chain in India

Increasing scale of
organised retail distribution network and increasing competition are forcing
the players to focus on restructuring the whole supply chain to improve
productivity and provide a better deal to customers. Indian market and
customers are mainly influenced by their socio economic environment and
psychological behaviour so retailers should be aware of these factors. However,
no holistic study has been reported in the Indian context probing that which
parameters shoppers’ consider important when they decide which retail format
they want to shop in and from which parameters they derive maximum utility. In
India, organized retailers are trying out a variety of formats, ranging from
supermarkets, discount stores to organise. The innovations brought by retailers
and marketers in the practice of retailing have been providing new paradigms in
the way shoppers have been disposed towards their act of shopping.  (S. Pannerselvam, 2011)








Consumer Survey Questionnaire 

1) Name:

2) Current City:  

3) Gender:               Male                                 Female 

4) Age:                   Less than 25                        25-30                       30-35                      35 and above 

5) Educational qualification:                   Undergraduate                       Graduate                 Postgraduate    

6) Monthly income:                <10,000             10,000-20,000             20,000-30,000              >30,000 

7) Background:       
            Urban                                 Rural 

8) Where do you often purchase Fruits and

     I) Street

    II) Mom
and Pop shops/Convenience Stores                                     

  III) Super

 IV) Online
Grocery Stores

  V) Organised

9) Why do you prefer these stores?

   I) Close to

   II) Quality

  III) Cheaper

  IV) Service

12) Which Fruits and Vegetables products do you

 I) Uncut

II) Pre-cut    

13) Factors influencing buying behaviour





14) Frequency of purchasing Fruits or Vegetables


alternate Days


in Month

15) Ranking of Consumer based on the Factors that
determines the Consumption of their Preferred Purchasing Location


At All Important

Little Important





within area of residence







attractiveness (freshness)







dietary pattern of household







of item







of close substitute




























grade level















and Bibliography


Organized AFGRI-FOOD
retailing in India by NABARD, 2011.

Challenges faced by
organized retail companies of Agro products in Haryana by Dr. Rajiv kaushik and
Kapil Dev, 2015

S. Pannerselvam (2011),
International Journal of Research in IT, Management and Engineering,

Rakesh, Banaras University, 2009, Problems and
prospects of food retailing in the state of Uttar Pradesh

Categories: Accounting


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