ASSIGNMENT

ON
RETAIL MANAGEMENT & SELLING

UNDER GUIDENCE OF
Prof. A.N. Bhattacharya

SUBMITTED TO:-

Prof. A.N. Bhattacharya

Faculty of Retail Management & Selling

IILM-GSM, Greater Noida

SUBMITTED BY:-

Adarsh Tyagi FT-09-707

Kaushik Dasgupta FT-09-763

 ACKNOWLEDGEMENT

We take this opportunity to convey our sincere thanks and

gratitude to all those who have directly or indirectly helped and
contributed towards the completion of this assignment.

First and foremost, we would like to thank Prof. A.N. Bhattacharya

Faculty, IILM-GSM, Greater Noida for his constant guidance and
support throughout this entire assignment. During the project, we
realized that the degree of relevance of the Retail Management &
Selling being imparted in the industry is very high. The Retail
Management & Selling study enabled us to get a better
understanding of the nitty-gritty of the company.

We would also like to thank our batch mates for the discussions
that we had with them. All these have resulted in the enrichment
of our knowledge and their inputs have helped us to incorporate
relevant issues into project.
 ABSTRACT

Growing number of luxury brands in different region of India

coming with their products to emerge in Indian market so
focusing on the same problem by AGS they come up with the
Aerens Gold Souk Luxury Retail which provides Luxury brands the
perfect platform by partnering and investing in retail initiatives in a
big way. AGS found the gap of luxury jems & jewellary brand in
Indian market and they come up with concept of keeping all
brand together at one place so that if the competitors of first
brand wants to enter in Indian market they will come to their mall
for there respective shop, apart from this AGS also want to
provide platform to there people to come at their place and shop
under one roof with lots of variety with premium segments. This
assignment is analysis of the location, pricing, merchandise and
positioning strategy of AGS. The assignment also presents
evaluation of Indian capacity with time towards luxury brand.
 INDIAN JEWELLERY INDUSTRY
• Market Size

• Fourth largest consumer market in the world

• Jewellery Market Size: Rs75,000 crores

• Diamond jewellery: Rs10,000 crores

• Largest market in terms of volume of gold

• India accounts for more than 22% of the total gold used for jewellery
purposes

• Growth

• Gold jewellery Market Growth: 8-10%

• Diamond jewellery Market:18%-20%

Gems and Jewellery Industry in India

The Indian gems and jewellery industry is one of the fastest growing segments in the Indian
economy with an annual growth rate of approximately 15 per cent. With exports of over US$
20 billion in 2007-08, the gems and jewellery sector accounts for nearly 13 per cent of
India¶s total exports. According to an ASSOCHAM report released in 2007, the gems and
jewellery industry employs over 1.3 million people, directly or indirectly. The report further
states that worldwide, the industry is estimated to be around US$ 130 billion, while the
Indian gems and jewellery market in 2006-07 was approximately worth US$ 13.5 billion.

India is already the largest diamond cutting and polishing centre in the world²the Indian
diamond cutting and polishing industry enjoys 60 per cent value share, 82 per cent carat share
and 95 per cent share of the world market in terms of number of pieces. In other words,
nearly 9 out of 10 diamonds sold worldwide are cut and polished in India. But now, thanks to
positive government policies such as 100 per cent Foreign Direct Investment (FDI) in gems
and jewellery through the automatic route, India is on the verge of becoming the focal point
of the global gems and jewellery industry. ‡ Total gems and jewellery exports from India
stood at US$ 20.88 billion for 2007-08, a growth of 22.27 per cent over US$ 17.08 billion the
previous year, as per the Gems and Jewellery Export Promotion Council (GJEPC). ‡ The
United States and Hong Kong were the largest importers of gems and jewellery from India,
with a share of 26 per cent each, followed by UAE at 21 per cent. ‡ Gold jewellery exports
increased from US$ 5.2 billion in 2006-07 to US$ 5.6 billion 2007-08. ‡ The domestic
market for gems and jewellery is likely to increase to US$ 20 billion by 2010 and US$ 30
billion by 2015. ‡ India is the largest consumer of gold in the world, followed by China and
Japan. India consumes nearly 800 tonnes of gold that accounts for 20 per cent of world gold
consumption, of which nearly 600 tonnes go into making jewellery. ‡ India is also emerging
as the world s largest trading centre for gold targeting US$ 16 billion by 2010. ‡ Branded
jewellery is likely to be the fastest-growing segment in domestic sales. The sector is expected
to grow at 40 per cent annually to touch US$ 2.2 billion by 2010. ‡ The Indian diamond
jewellery industry is the third largest consumer of polished diamonds after USA and Japan.
Diamond jewellery consumption is likely to jump to nearly 80 per cent in 2010 and over 95
per cent between 2010 and 2015. ‡ Indian industry has the best skilled manpower for
designing and producing high volumes of exquisite jewellery at low labour costs. ‡ The
Indian gems and jewellery industry has been gaining prominence as an international sourcing
destination for high quality designer jewellery. International stores such as Wal-Mart and JC
Penney are increasingly procuring jewellery from India.

Retail Sector
The Indian gems and jewellery market continues to be dominated by the unorganised sector.
There are over 2.5 million jewellery shops in India and most of them are family run.
However, with the Indian consumer becoming more aware and quality conscious, branded
jewellery is becoming very popular and the market for branded jewellery is likely to be worth
US$ 2.2 billion by 2010 according to a McKinsey report. With an increasing number of
jewellery houses entering the branded jewellery sector, retail of jewellery is becoming
organised. Moreover, the government allows 51 per cent FDI in single brand retail outlets,
attracting both global and domestic players to this sector. Plus Indians love for jewellery
ensures that the gems and jewellery market continues to be lucrative. According to an
ASSOCHAM report, the increasing purchasing power parity of the middle class and surging
income levels have resulted in an increase in the consumption of gems and jewellery by
around 11 per cent in the five year period preceding 2006-07. Not surprising then, according
to a report released by Technopak Advisors on the Changing Retail Landscape in India, the
jewellery and watches market is pegged at about US$ 13.70 billion. It is expected to register a
12 per cent growth by 2012, touching US$ 23.60 billion. The World Gold Council recently
estimated the size of India¶s gold coin market at about US$ 2.11 billion. According to Ajay
Mitra, managing director of the World Gold Council¶s India office, the coins business would
see revenues of about US$ 63. 54 million - US$ 105.90 million over the next six months on
sales of about 75-76 tonnes.
Background

• The Indian jewellery Industry is one of the largest domestically (and in the world)
and has some unique characteristics

• Recent Changes in the Lifestyle goods industry and the diamond industry have
created some opportunities and challenges

• The family jeweler segment is the largest segment of the market and hence most
likely to be impacted by these changes

• If the industry needs to initiate changes at the firm or Industry level , the leaders
need to agree on the challenges facing them and the strategies needed to cope
with them
 AGS
Lifestyling India
Company Overview

The Aerens Enterprises, established in 1969, has been a front-runner in real estate
and infrastructure development for nearly four decades. Aerens has been
instrumental in the creation of housing, township, hospitality, specialty retail,
entertainment, SEZ and infrastructure projects in the real estate sector. The Aerens
Gold Souk Group, a strategic business arm of the Aerens Enterprises, is focused on
retail development and has pioneered the concept of specialty malls in India. We
strive for:

INTELLIGENT BUILDING MANAGEMENT through adoption of latest

technology.

GREATER STAKEHOLDER VALUE through the alignment of internal standards

with international benchmarks.

PROTECTING LONG TERM VIABILITY of our business by reconciling our

interests with the needs of society and the protection of the environment.

History
AGS Group is a part of the Aerens Family of Enterprises established in 1969.
For close to four decades, the Aerens Family of Enterprises has built an enduring value for
their stakeholders based on the principles of quality, trust and reliability. Today, the Aerens
Family of Enterprises has emerged as a diversified real estate company with several path
breaking projects to its credit.

Vision
"To evolve into a major player in real estate, retail infrastructure and
project development"

Mission
"To pioneer a retail revolution by creating quality infrastructure to usher one stop shopping
experience in quality, variety and value"

Clientele
Hazoorilal Jewellers
Damas
Alukkas ( Joy Alukkas group)
Bholasons Jewellers
Notandas and Sons Jewelers
B.C SEN Jewellers
Avenue Montaigne
Anmol Jewellers
Adora Diamond Jewellery
 LOCATION
STARTEGY
For a retail outlet it is important to locate the outlet at right place so that the
customer we are targeting for there desire based product at higher segment ,
the outlet should also be under coverage our customer. By focusing on the
same issue AGS opens their store at different region of the India to cover their
target customer more in number. For locating the outlet one should keep in
mind the wandering of customer with variety of product.

AGS started off as real estate consultants in 1969 and subsequently turned into
developers. The Group is headed by our founder Chairman, Mr. Surender
Gupta, whose dynamic leadership has been instrumental in taking the
organization to great heights. We have been involved in Group housing
projects, township development, water and amusement parks and other
commercial structures. Some of our Group projects include Aloha in Gurgaon,
Carnival Country in Vaishali in Delhi, Aerens Europark on NH24, AEZ Vikaspuri
in Delhi and Crown Interiorz located on NH2. We are now in the process of
building large format multi-specialty malls across the country under ?The
Souk? brand, with two specialty malls for Jewelry already operational in
Gurgaon and Delhi. Our sister concern has the exclusive rights for setting up
nine Imax theatres in North and East India, with one already operational in the
North and three under constructionThey are keeping in their store which is as
follows:-

STORE LOCATIONS
In context to Store Location for different product categories, a consumer can
have different preferences as to the distance s/he would like to travel. For
example :
• For groceries a consumer would at the most prefer to travel – 3 km
• For cosmetics a consumer would at the most prefer to travel – 5 km
• For apparels a consumer would at the most prefer to travel – 10 km
• For books a consumer would at the most prefer to travel – 4 km
 • For music a consumer would at the most prefer to travel – 2.5 km
• For Jewllery a consumer would at the most prefer to travel – 1.5 km
By focusing on the above travelling distance AGS decided to locate their mall at
selected region of India. The AGS is mainly focusing on the main of the city and
accordingly they come up with projects respectively:-

GOLD SOUK, GURGAON

ABOUT PROJECT

With 1,80,000 square feet of opulent and lavish shopping experience, Gold Souk Gurgaon is
home to over 100 national and international jewelry brands. The success of Gold Souk can be
best measured in terms of the high conversion of footfalls, averaging over 70-80% as
compared to general mall’s average of 10 to 15%. Gold Souk has been felicitated with over a
dozen awards and recognitions from various trade associations and is also a proud recipient
of the prestigious ‘Best Commercial Retail Venture’ award instituted by Builder Information
Bureau.

Gold Souk offers shoppers a world class jewelry buying experience that is unmatched both in
terms of choice and value. With jewelers and jewelry brands from all corners of India and
abroad, Gold Souk offers a mind-blowing selection of classy jewelry ranging from elegant
earrings to ornate necklaces. With showrooms spread lavishly over three floors, Gold Souk
leaves customers spellbound by the sheer variety of jewelry on display. And if that doesn’t
suit the customer’s taste they can even get their own piece exclusively created by world class
designers.

BRANDS

 Hazoorilal Jewellers
 Damas
 Alukkas ( Joy Alukkas group)
 Bholasons Jewellers
 Notandas and Sons Jewelers
 B.C SEN Jewellers
 Avenue Montaigne
 Anmol Jewellers
 Adora Diamond Jewellery
 Tag Heuer
 Longiness
 Dolce Vita
 Sangini
 Carbon
 Moksha
 Asmi
 KIAH
GOLD SOUK, DELHI
ABOUT PROJECT

Buoyed by the success of AGS Group’s flagship venture Gold Souk, Gurgaon, the company
has replicated the same success story at Pitampura in the heart of Delhi. Gold Souk Pitampura
offers world class specialty shopping spaces to traditional and branded jewelry segments, all
under one roof thereby benefiting retailers and discerning customers

GOLD SOUK, LUDHIANA

ABOUT PROJECT

Spread across 6 lakh square feet ‘The Souk’ Ludhiana features specialty zones where similar
category brands are placed together be they jewelry outlets, anchor stores or even lifestyle
retail brands. The Souk also features a hypermarket, food court, multiplex and the first
Ginger Hotel on top of a mall. The presence of Gold Souk and Ginger Hotel at The Souk,
Ludhiana will no doubt attract walk ins from the main city as well as from neighboring areas
like Jallandhar, Chandigarh, Amritsar and beyond making it a true destination mall. It has
been designed by internationally acclaimed architect Achal Kataria.

GOLD SOUK, KOCHI

ABOUT PROJECT

The Souk, Kochi, with 5,00,000 square feet of retail space is the discerning shoppers ultimate
getaway. Being the first and largest mall in the commercial capital of Kerala, it has been
exclusively zoned to provide a state-of-the-art shopping experience to Keralites, shoppers
from neighbouring cities and the large NRI population. The Souk, Kochi has been designed
by W.S. Atkins, the designer of the famed Burj-al-Arab, Dubai.

Other Highlights

• Kerala’s biggest mall

• Startegically located on Vyttilla Junction in Kochi
• Features Gold Souk, Lifestyle Retail, Multiplex & Food Court
• To be operational by Quarter 3, 2008
GOLD SOUK, JAIPUR
ABOUT PROJECT

Exclusively designed to complement the city’s regal skyline, Gold Souk Jaipur is poised to
become the ultimate jewelry buying destination. With over 3,00,000 square feet of premium
retail and office space, Gold Souk Jaipur will provide discerning customers from local
catchment areas and tourists from around the world an out-of- this-world jewelry shopping
experience.

Other highlights

• Rajasthan’s first Gold Souk

• Located near Jawahar Circle
• Features India’s first B2B market-Gem Souk
• To be operational by Quarter 2, 2008

REASONS TO TAKEN STEPS TO MOVE INTO TOWNSHIPS, GROUP

HOUSING, IT PARKS, SEZS AND OFFICE COMPLEXES
We have achieved considerable success in specialty retail and our plan of creating 100 souks
in 100 cities in 100 months is well on track. Now we are looking at high growth opportunities
in other real estate areas. Property markets are increasingly moving from being fragmented to
becoming organized. Present estimates suggest that demand for office space stands at 80mn
square feet and for IT Parks/SEZs at 50mn square feet. Similarly, township development and
Group housing are emerging as key growth areas as income levels in urban areas are on the
rise and fruits of economic growth are percolating to different economic and geographic
segments. We want to be at the forefront of emerging opportunities in these sectors.

FUTURE PLANS
At AGS Group, we think of ourselves, not as ‘builders and developers’, but as ‘builders and
promoters’. That’s because we invest heavily in our marketing and promotions to ensure the
success of each venture. It is this commitment that allows us to offer:-

 Best international standard ambience

 Best retail mix of similar category brands

 Best platform for expanding the reach of brands across India

Backed by the support of our clients and an unshakable belief in our abilities we are rapidly
taking ‘The Souk’ large format malls to all corners of India. We are also establishing Gem
and Jewellery Parks in the country while at the same time diversifying into:-

 Township
  Commercial Office Space

 Hospitality

 Group Housing & SEZs

MERCHANDISING
STRATEGY
Merchandise strategy in a retail business is the most crucial decision which would have direct
financial implications – affecting the bottom-line of the business either wise. The stages in
merchandise planning are:-

1) DEVELOPING A SALES FORECAST

In this AGS has followed the following stages which are given below:-

A) Reviewing past sales

 180 170
160
140 123 It a ly
115
120 USA
100
Jap an
80
60 C h in a
40 In d ia
12 10
20
0
P e r C a p it a c o n s u m p t io n in U S $

The per capita consumption of the jems and jewellary with respect to country is shown
above by focusing on it we can clearly observe that India per capita has risen from 7 to 10
which gives a positive indication to it.
 B) Analyzing the changes in the economic conditions
The economic condition of India has continuously rising and came upto a GDP
of 1.367 trillion US$

C) Analyzing the changes in the sales potential

The selling potential of India is rising and it also attracting the International
brand to open their shop in India by analyzing the sales potential of Indians in
main cities of India they planned to open and merchandise shop with their
best space availability in the mall.

D) Analyzing the changes in the marketing strategies of the

retail organization/competition
By analyzing the strategies retail organization they merchandise their mall at
the heart of the city so that more number of customer can see the mall and
attract towards it.

E) Creating the sales forecast

For making the merchandise finished properly to the customer end their should
be strong sales forecast which can predict and match with the target

2) DETERMINING THE MERCHANDISE REQUIREMENT –

A) Methods of inventory planning

i. The basic stock method

ii. The percentage variation method

iii. The week’s supply method

iv. The stock/sales ratio method

 B) The stock turnover rate
Six-month merchandise plan

C) Merchandise control –
They should focus on the following control which are
a) the open-to-buy concept
b) Limits over buying and under buying
c) Prevents loss of sales due to non-availability of required stocks
d) Maintains purchases within the budgeted limits
e) Reduces markdowns, which may arise due to excess buying.
f) Assortment planning - this stage involves the determination of the
quantities of each product that will be purchased so as to fit into the
overall merchandise plan. Details of colour, size, brand, material etc.
Have to be specified.

3) Sourcing merchandise

Sourcing for merchandise can be local, national or global. AGS

retail chains in the world, resort to global sourcing keeping in mind
various factors – primarily economic.

4) IDEA OF BUILDING SPECIALTY MALLS GERMINATE?

Our Group has been at the forefront of initiating new ideas and concepts. We
do not like to follow a league that is saturated and over crowded. To give you
an idea, we started the trend of living on farm houses in the 1990s,
predominantly in North India and have developed more than 500 acres of
farm house area with landscaping. We were also the first in the country to
develop a multiplex, PVR Vikaspuri, with a shopping mall in the year 2000,
with others following suit.
 
In 2001, when we were mulling over the Gold Souk concept, mall culture was
the talk of the town then. We believed that for any mall to be successful, it
should have a unique selling point. That?s when the concept of a specialty
mall germinated.  We were aware that there would be huge influx of malls in
Gurgaon. Hence all the malls would eventually cater to just the neighborhood.
We wanted something beyond catering to the neighborhood and worked on
making it a destination-based mall.
 PRICING STRATEGY
The AGS has set up their mall in heart of the city so they are keeping the price in each and
every segment covering:-

Lower segment
Lower-Middle Segment
Middle Segment
Higher Segment/ Premium Segment
By focusing on the Indian retail for jewellary & watches it only cover 829 out of 9764
million US$ so for AGS they have vast variety of customer covering more than 50% of the
same type of customer so keeping the price outlet of each segment in their mall will be
preferable for them as still penetration is higher than the organized retail.

Mapping of India’s Income classes

Classes 1994-95 1999-00 2006-07

Rich 1million 3 million 6 million

(above 2.15 lac) Households Households Households

Consuming 29 million 66 million 75 million

(0.45– 2.15) lac Households Households Households

Climbers 48 million 66 million 78 milion

(0.22-0.45) lac Households Households Households

Aspirants 48 million 32 million 33 million

(0.16-0.22) lac Households Households Households

Destitute 32 million 24 million 17 million

Less than 0.16 lac Households Households Households

By focusing on the above income classes the huge variety of different income groups can
only be tagged by keeping each type of outlet in their mall so there pricing strategy is to
cover a huge market size with there more number of National and International brand in
their mall to increase foot-step to their outlet and apart from this they are opening it in
the main centre of the city so that people can come to shop and have experience of
different jems & jewellary brand under one roof.
 POSITIONING

STRATEGY
AGS focusing to position themselves to the top of the jewellary mall with National &
International brand so that the brands can not turn towards another mall opener in
the same city as well as they keep AGS as a brand and easily recognized by the
people whenever jewellary mall come into the mind of customer they always come
up with the name of Gold Souk.

Gold Souk, Gurgaon has been a great success story. It has found immense success
and earned the goodwill of customers and retailers. We showcase leading brands
such as Damas, Tanishq, Anmol, Adora, Orra, Classic Diamonds, Alukkas,
Bholasons, Kiah, Asmi, Notandas, B.C. Sen, Avenue Montaigne, M.P. Jewelers,
Hazoorilal and many more along with world class designers like Rosily Paul, Ruhee
Nanda and Monica Kapoor.

Some of the malls in North India have not been running successfully. While footfalls
are high, conversion ratios do not match the same. Huge crowds pour into cinema
halls/multiplexes, but not many end up shopping. Food items are the only thing that
seems to sell and it?s a bad combination of serious purchase with entertainment.
Gold Souk, Gurgaon has been witnessing conversion rates of over 80% as
compared to 8-10% for general malls. All our malls are on highways, away from
cities. Our study showed that in the case of jewelry purchases, people from smaller
cities come to bigger cities. Our research shows that 40% of the people that visit
Gold Souk, Gurgaon come from out of Gurgaon and Delhi. We have regular
shoppers from places like Simla, Jaipur, Muradabad, Ludhiana, Chandigarh, Jammu,
Agra and Meerut.

The success can be measured from the demand for space as lease rates have
moved from Rs50-55 per square feet in 2003 to Rs500 per square feet presently,
perhaps, the costliest mall in India.

Limitation for GOLD SOUK:-

• Gold as a share of wallet is decreasing in the younger generation. Traditional
jewellery is still the dominant design pattern while contemporary styles are
emerging fast

• Although guarantee of the retailer is important in ascertaining quality, hallmarking

is gaining acceptance

• In the past choice of stores used to be 1-2 stores, but customers now look at 4-5
stores for range and choice of jewellery

• The main occasions to buy are still marriage and festivals

• Customers in the high value category are becoming more informed because of
exposure to media and fashion trends

• They have the selected city to open their jewellary mall

• Indian population still interested to buy their selected shopkeeper

 BUSINESS SUMMARY
AGS Group is a diversified real estate conglomerate with a
portfolio that spans all market segments whether they be
retail, residential, commercial, township or even SEZ projects.
The company is well known for having established Gold Souk
luxury malls and The Souk multi specialty malls across the
country. With projects spread across all corners of the
country and plans to create 100 million square feet of
premium space, AGS is all set to fulfill its motto of 'Lifestyling
India'. Gold Souk Gurgaon is India's first specialty mall
dedicated to jewelry and luxury and houses over 100 leading
national and international jewelry & luxury brands from India
and abroad.

Bibliography
 RMS Slides by Prof. A.N. Bhattacharya
 www.goldsoukindia.com
 www.google.com
 www.wikipedia.com
 RMS book by Berman Evans