EFFECT OF ORGANIZED RETAIL ON UNORGANIZED RETAIL: Review of Literature

Review of Literature

Purohit & Kavita (2009) According there studies that the traditional retailers are not very much clear about the consequences of the modern retailing the traditional retailers are netural or undecided, modern retailing will cut the profit margin of the traditional retailers; the modern retailing will lead healthy compition in the market, modern retailing will reduce the sales volume of the traditional retailers and traditional retailers should improve customer care services in the era of modern retailing. Step Towards Success

Shaoni Shabnam (2008) it is important to highlight that in organized retail, the status of employment is much better than that in unorganized retail. Hence it is definitely desirable that more and more labour gets absorbed in this sector of retail. In the current context, the labour employed in unorganized retail stands unfit for finding employment in organized retail. If appropriate training and skills could be imparted to them, it is possibly feasible to offer better forms of employment to them in the organized retail sector. The status of employment is much better than that in unorganized retail. Hence it is definitely desirable that more and more labour gets absorbed in this sector of retail. In the current context, the labour employed in unorganized retail stands unfit for finding employment in organized retail. If appropriate training and skills could be imparted to them, it is possibly feasible to offer better forms of employment to them in the organized retail sector.

Meeta Punjabi(2008) According there study they suggest that the development efforts in this area are based on three grounds: First, farmers associated with the modern value chains earn higher returns than selling to the traditional markets. Second, the modern supply chains have specific quality requirements which are easier to meet by the large and medium farmers and the small farmers tend to get left out of these markets. Third, there are several successful examples of linking small farmers to these modern value chains with effort from government agencies, NGOs and development agencies. This knowledge presents strong grounds for a closer look at the emerging sector in India.

Mathew Joseph (2008) Unorganized retailers in the vicinity of organized retailers experienced a decline in their volume of business and profit in the initial years after the entry of large organized retailers. The adverse impact on sales and profit weakens over time. There was no evidence of a decline in overall employment in the unorganized sector as a result of the entry of organized retailers. There is some decline in employment in the North and West regions which, however, also weakens over time. The rate of closure of unorganized retail shops in gross terms is found to be 4.2 per cent per annum which is much lower than the international rate of closure of small businesses. The rate of closure on account of competition from organized retail is lower still at 1.7 per cent per annum. There is competitive response from traditional retailers through improved business practices and technology upgradation. A majority of unorganized retailers is keen to stay in the business and compete, while also wanting the next generation to continue likewise. Small retailers have been extending more credit to attract and retain customers. However, only 12 per cent of unorganized retailers have access to institutional credit and 37 per cent felt the need for better access to commercial bank credit. Most unorganized retailers are committed to remaining independent and barely 10 per cent preferred to become franchisees of organized retailers.

The objectives of the research are

To find out the consumer behavior towards organised (supermarkets/malls, hypermarkets, departmental storesetc) and unorganized (local kirana stores, weekly bazaars etc) retail stores in Indore.

To find out the consumers satisfaction level from organised retail stores as well as unorganised retail stores.