INVENTORY MANAGEMENT TECHNIQUE USED IN

RETAIL INDUSTRY
A CASE STUDY OF VISHAL MEGA MART

FOR THE PARTIAL FULFILLMENT OF THE

REQUIREMENT FOR THE AWARD OF
MASTER OF BUSINESS ADMINISTRATION

UNDER THE GUIDANCE OF:

Ms. Apoorvi Tondon

SUBMITTED BY:

Udit

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CONTENTS

INTRODUCTION & SCOPE OF THE STUDY

Introduction..1-13
About retail industry....14-19
About Vishal Mega Mart..20
Objective of the Study.... ...21
Scope of study......22
....

LITRATURE REVIEW
Introduction...23-33
RESEARCH METHODOLOGY

Introduction......34
Research design.......34
Collection of Data....35
Research tool....35
Area of study...35
Sampling technique.....35
Questionnaire Characteristics..36

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 LIMITATION
ANALYSIS OF DATA...37
CONCLUSION.45
SUGGESTION 46
BIBLOGRAPHY.....48
ANNEXURE....49

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ACKNOWLEDGEMENT
Knowledge is an experience gained in life, it is the choicest possession,

which should not be shelved but should be happily shared with others.
With regard to my project on Inventory management technique used in retail
industry. I would like to thanks each and every one who offered help, guidelines and
support whenever required.
I am extremely greatful to my faculty guide, for her guidance and timely
suggestion. I would like to all my friends of Khandelwal College for giving their valuable
inputs and time. The guidance help and cooperation of my mentor Ms. Apoorvi Tondon
is being a constant source of motivation.
This research was a good exposure that will definitely help me in my professional
career.

UDIT
MBA
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DECLARATION

This project has been undertaken as a partial fulfillment of the requirement for the award
of the degree of Master of Business Administration of Gautam Buddha Technical
University.
The project was executed after the third semester under the supervision of Ms. Apoorvi
Tondon.
Further I declare that this project is my original work and the analysis and finding are for
academic purpose only. I cannot produce it in any other diploma and degree course.

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INTRODUCTION & SCOPE

Introduction
In our daily life, we observe that a small retailer know roughly the demand of his
customers in a month or a week, and accordingly places orders on the wholesaler to meet
the demand of his customers. But, this is not the case with a manager of a big
departmental store or a big retailer, because the stocking in such cases depends upon
various factors, e.g. demand, time of ordering, lag between orders and actual receipts, etc.
so the real problem is to have a compromise between over-stocking and under-stocking.
Within this perspective I selected a study on inventory management technique used by
Vishal Mega Mart. Inventory refers to stocks, goods or anything necessary to do business.
This study provides me the knowledge about significance of inventory management in
retail industry. An effective inventory management technique will able to provide
reduction in overall inventory cost in the organization.
The primary objective of inventory management is to determining, controlling stock
levels within the physical distribution function to balance the need for product
availability against the need for minimizing stock holding and handling costs. A proper
planning of purchasing, handling, storing and accounting should form a part of inventory
management. By proper planning it is possible for a company to reduce its levels of
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inventories to a considerable degree, without any adverse effect on production and sales,
by using simply inventory planning and control technique.
An efficient system of inventory management will determine What to purchase? How
much to purchase? From where to purchase? Where to store?
The study of such type of problems is known by the term Material Management
or inventory Control. The inventory control may be defined as follows:
Definition The function of directing the movement of goods through the entire
manufacturing cycle from the requisitioning of raw materials to the inventory of finished
goods orderly mannered to meet the objectives of maximum customer-service with
minimum investment and efficient (low-cost) plant operation.
The models here limited mainly to the elementary type, because the analytical
study of the other cases be-comes more difficult. After a general discussion of each
indicated type of model, we shall give many interesting solved examples so that all the
necessary ideas may be clear to the students. We shall also discuss another class of
inventory models, namely Inventory Models with price Breaks (i.e. Quantity Discount
Models).

What is inventory?

In broad sense, inventory may be defined as the stock of goods, commodities or other
economic resources that are stored or reserved in order to ensure smooth and efficient
running of business affairs.
The inventory may be kept in any of the following forms:
(i)

Raw material inventory, i.e. raw materials which are kept in

stock for

(ii)

using in the production of goods.

Work-in-process inventory, i.e. semi finished goods or goods in

process which are stored during the production process.

(iii)

Finished goods inventory i.e. finished goods awaiting shipment from

the factory.
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(iv)

Inventory also include: furniture, machinery, fixtures, etc. The term

inventory may be classified in two main categories.

1. Direct Inventories:

The items which play a direct role in the manufacture and become an integral part
of finished goods are included in the category of direct inventories. Those may be
further classified into four main groups:

(a) Raw material inventories are provided

(i)

For economical bulk purchasing

(ii)

To enable production rate changes

(iii)

To provide production buffer against delays in transportation

(iv)

For seasonal fluctuations.

(b) Work-in-process inventories are provided

(i)

To enable economical lot production

(ii)

To cater to the variety of products

(iii)

For replacement of wastages

(iv)

To maintain uniform production even if amount of sales may vary.

(c) Finished-goods inventories are provided

(i)
(ii)

For maintaining off-self delivery

To allow stabilization of the production level

(iii)

For sales promotion.

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(d) Spare parts

2. Indirect Inventories:
Indirect inventories include those items which are necessarily required for manufacturing
but do not become the component of finished production, like oil, grease, lubricants,
petrol, office-material, maintenance material, etc.

Types of Inventory
Basically, there are five type of inventory:
I. Fluctuation Inventories: These have to be carried because sales and
production times cannot be predicted accurately. In real-life problems, three are
fluctuations in the demand and lead-times that affect the production of items.
Such type of reserve stocks or safety stocks is called fluctuation inventories.
II. Anticipation Inventories: These are built up in advance for the season of
target of large sales, a promotion program or a plant shut-down period. In fact,
anticipation stores the men and machine hours for future requirements.
III. Cycle (lot-size) Inventories: In practical situations it seldom happens that
the rate of consumption is the same as the rate of production or purchasing. So the
items are procured in longer quantities than they are required. They results in
cycle (or lot-size) inventories.

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IV. Transportation Inventories: Such inventories exist because the materials

are required to move from one place t another. When the transportation time is
long, the items under transport cannot be served to customers. These inventories
exist solely because of transportation time.
V. Decoupling Inventories: Such inventories are needed for meeting out the
demands during the decoupling period of manufacturing or purchasing.

Inventory decisions

The managers must take two basic decisions in order to accomplish the functions of
inventory. The decisions made for every item in the inventory are:
(i)

How much amount of an item should be ordered when the inventory of

that item is to be replenished?

(ii)

When to replenish the inventory of that item?

Inventory model development Process?

As explained earlier, inventory models are concerned with two main decisions:
how mush to order at a time and when to order so as to minimize the total cost?
The sequence of basic steps required for developing an inventory model may be
organized as follows:
Step 1: -

First take the physical stock of all the inventory items in an

organization.

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Step 2:-

Then, classify the stock of items into various categories. Although

several methods are available to classify the inventories; but the
selected method must serve the objectives of inventory
management. For example, inventory items may be classified as
raw

materials,

work-in

process,

purchased

components,

consumable stores and maintenance spares, and finished goods,

etc.
Step 3:-

Each of above classifications may be further divided into several

groups. For example, consumable stores and main tenancy spares
can be further divided into the following groups:

Step 4:-

After classification of inventories, each item should be assigned a

suitable code. Coding system should be flexible so that new items
may also be permitted for inclusion.

Step 5:-

Since the number of items in an organization is very large, separate

inventory management model should be developed for each
category of items.

Step 6:-

Use A-B-C or V-E-D classification (as discussed in the next

chapter) which provide a basis for a selective control of inventories
through formulation of suitable inventory policies for each
category.

Step 7:-

Now decide about the inventory model to be developed. For

example, fixed-order-quantity system may be developed for A
class and high valued B class items; whereas periodic review
system may be developed for low valued B class and C class
items.

Step 8.

For this, collect date relevant to determine ordering cost, shortage

cost, and inventory carrying cost. Etc.

Step 9.

Then, make an estimate of annual demand for each inventory item

and their prevailing market price.

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Step 10.

Estimate lead-time, safety stock and reorder level, if supply is not

instantaneous. Also, decide about the service-level to be provided
to the customers.

Step 11.

Now develop the inventory model.

Step 12.

Finally, review the position and make suitable alterations, if

required, due to current situations or constrains1.

Before we proceed to discuss inventory models, it is very desirable to consider briefly the
costs involved in the inventory decisions:

1. Holding Cost (C1): The cost associated with carrying or holding the goods in
stock is known as holding or carrying or holding the goods in stock is known as holding
or carrying cost which is usually denoted by C1 per unit of goods for a unit of time.
Holding cost is assumed to vary directly with the size of inventory as well as the time the
item is held in stock. The following components constitute the holding cost:
(i)

Invested Capital Cost. This is the interest change over the capital investment.
Since this is the most important component, a careful investigation is required
to determine its rate.

(ii)

Record-keeping and administrative. Cost signifies the need of keeping funds

of maintaining the records and necessary administration.

(iii)

Handling Costs. These. Include all costs associated with movement of stock,
such, such as cost of labour, over head cranes, gantries and other machinery
required for this purpose.

1
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(iv)

Storage Costs. These involve the rent to storage space or depreciation and
interest even if the own space is used.

(v)

Storage Costs. These involve the rent of storage space or depreciation and
interest even if the own space is used.

(vi)

Taxes and Insurance Costs. All these costs require careful study and generally
amount to 1% to 2% of the invested capital.

(vii)

Purchase price or Production Costs. Purchased price per unit item is affected
by the quantity purchased due to quantity discounts or price-breaks.
Production cost per unit item depends upon the length of production runs. For
long smooth production runs this cost is lower due to more efficiency of men
and machines. So the order quantity must be suitably modified to take the
advantage of these price discounts.
If p is the purchase price of an item and I is the stock holding cost per unit
time expressed as a fraction of stock value (in rupees), then the holding cost
C1 = IP.

(viii)

Salvage Costs or Selling Price. When the demand for an item is affected by its
quantity in stock, the decision model of the problem depends upon the profit
maximization criterion and includes the revenue (sales tax & etc.) from the
sale of the item. Generally, salvage costs are combined with the storage costs
and not considered independently.

2.Shortage Costs or Stock-out Costs (C2): The penalty costs that are in incurred
as a result of running out of stock (i.e., shortage) are known as shortage or stockout costs. These are denoted by C2 per unit of goods for a specified period.
These costs arise due to shortage of goods, sales may be lost, and goods will may
be lost either by a delay in meeting the demand or being quite unable to meet the
demand at all. In the case where the unfilled demand for the goods can be
satisfied at a latter date (backlog case), these costs are usually assumed to vary
directly with the shortage quantity and the delaying time both. on the other hand,
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if the unfilled demand s lost (no backlog case), shortage costs become
proportional to shortage quantity only.

3. Set-up Costs (C3): These include the fixed cost associated with obtaining
goods through placing of an order or purchasing or manufacturing or setting up
machinery before starting production. So they include costs of purchase,
requisition, follow-up, receiving the goods, quality control, etc. these are also
called order costs or replenishment costs, usually denoted by C3 per production
run (cycle). They are assumed to be independent of the quantity ordered or
produced.

Why Inventory Is Maintained?

As we aware of the fact that the inventory is maintained for efficient and smooth
running of business affairs. If a manufacturer has no stock of goods at all, on
receiving a sale-order he has to place an order for purchase of raw materials, wait
for their receipt and then start his production; thus, the customers will have to
wait for a long time for the delivery of the goods and may turn to other suppliers.
This results in a heavy loss of business. So it becomes necessary to maintain an
inventory because of the following reasons :

Inventory helps in smooth and efficient running of business.

Inventory provides service to the customers immediately or at a short notice.

Due to absence of stock, the company may have to pay high prices because of
wise purchasing. Maintaining of inventory may earn price discount because of
bulk-purchasing.
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Inventory also acts as a buffer stock when raw materials are received late and so
many sale-orders are likely to be rejected.

Inventory also reduces product costs because there is an additional advantage of

batching and long smooth running production runs.

Inventory helps in maintaining the economy by absorbing some of the

fluctuations when the demand for an item fluctuates or is seasonal.

Pipeline stocks (also called process and movement inventories) are also necessary
where the significant amount of time is consumed in the trans-shipment of items
from one location to another.

Mathematically, the problem of maintaining the inventory arises due to the fact
that if a person (e.g., a big retailer) decides to have a large stock, his holding
cost C1 increases but his shortage cost C2 and set-up cost C3 decrease. On the
other hand, if he has small stock, his holding cost C1 decreases but shortage cost
C2 and set-up cost C3 increase. Similarly, if he decides to order very frequently,
his ordering cost increases while other costs may decrease. So it becomes
necessary to have a compromise between over-stocking and under-stocking by
making optimum (most favorable) decisions by controlling the value of some
variables which are at our disposal.

Variables in Inventory Problem

We shall now proceed to classify the variables which are involved in an inventory
problem.
The variables used in any inventory model are of two types :
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(a) Controlled variables,

(b) Uncontrolled variables.

a) Controlled Variables:

The following are variables that may be controlled separately or in combination:

1)

How much quantity acquired (by purchase, production, or some other means).
This may be adjusted for each type of resources separately or for all items
collectively in one of the following ways:

(i)

The quantity to be ordered should be q quantity units;

(ii)

The quantity to be ordered should be such as to raise the stock level to S

quantity units;

(iii)

The quantity to be ordered should be such as to raise the stock level on

hand and on order to z.

2.

The frequency or timing of acquisition. How often or when to replenish the

inventory?
The inventory should be replenished when
(i)

The amount in stock is equal to or below S quantity units. Or

(ii)

The amount in stock and the amount of order are equal to or below z. Or

(iii)

At every t time units.

3. The completion stage of stocked items.

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More finished the goods, lesser the delay in meeting the demands. But, on the
other hand higher will be the cost of holding them in stock. Lesser finished the
stock items, longer the time in meeting the demands, consequently lesser the cost
of holding in stock.
Most of the inventory models involve only first two types of control- led
variables.

Uncontrolled Variables:

The following are the principal variables the may not be controlled.
(1)

The holding costs (C1), shortage or penalty costly (C2), set-up costs (C3).

(2)

Demand (the number of items required per period).

We note that it is not necessarily the amount sold, because some demand may
go unfilled because of shortages or delays. It is, in fact, the demand that would
be sold if all that is required were available. The demand pattern of items may
be either deterministic or probabilistic.
In the deterministic case, it is assumed that the quantities needed over
subsequent periods of time are known exactly. Further, the known demand
may be fixed or variable with time. Such demands are called static and
dynamic respectively.

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The probabilistic demand occurs when the demand over a certain period of
time is not know with certainty; but its pattern can be described by a known
probability distribution. A probabilistic demand may be either stationary or
non-stationary over time.
(3)

Amount delivered (supply of goods).

The supply of goods may be instantaneous or spread over a period of time. If a

quantity q is ordered for purchase or production, the amount delivered may vary
around q with a know probability density function.

About Retail Industry

Retailing, in a laymans language involves the procurement of varied products in large

quantities from various sources/producers and their sales in small lot for direct
consumption to the purchaser. Retailing is the business where an organization directly
sells its products and services to an end consumer and this is for his personal use.
Whenever an organization manufacturing or a whole seller sells directly to the end
consumer it is actually operating in the Retail industry. The retail industry is divided into
organized and unorganized sectors. Unorganized retailing, on the other hand, refers to the

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traditional formats of low-cost retailing, for example, the local vendors, owner managed
general stores, convenience stores, hand cart and pavement vendors, etc.
With over 1,000 hypermarkets and 3,000 supermarkets projected to come up by 2011,
India will need additional retail space of 700,000,000 sq ft (65,000,000 m) as compared
to today. Current projections on construction point to a supply of just 200,000,000 sq ft
(19,000,000 m), leaving a gap of 500,000,000 sq ft (46,000,000 m) that needs to be
filled, at a cost of US$15-18 billion.
The Indian retail industry is the fifth largest in the world. India retail industry is one of
the fastest growing industries in India. The India retail industry is expected to grow from
Rs. 35,000 crore in 2004-05 to Rs. 109,000 crore by the year 2011. In 2007, the retail
trade in India had a share of 8-10% in the GDP (Gross Domestic Product) of the country.
In 2009, it rose to 12%. It is also expected to reach 22% by 2011.
The empowered Indian consumer and changing shopping patterns have paved the way for
modern retailing in India. Multi- stored malls, huge shopping centers, and sprawling
complexes which offer food, shopping, and entertainment all under the same roof are
springing up in every corner of tier II and tier III cities.
Indian retail market is the fifth largest retail destination globally. The industry raked in $
25.44 billion turnover in 2007-08 as against $ 16.99 billion in 2006-07, a whopping
growth rate of 49.73 per cent. The industry is estimated to grow from the $ 330 billion in
2007 to $ 427 billion by 2010 and $ 637 billion by 2015. Modern retail is likely to
increase its share in the total retail market to 22 percent by 2010.

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India has one of the largest number of retail outlets in the world. Of the 12 million retail
outlets present in the country, nearly 5 million sell food and related products. Organized
retail has increased its share from 5 per cent of total retail sales in 2006 to 8 per cent in
2007. The fastest growing segments have been the wholesale cash and carry stores (150
per cent) followed by supermarkets (100 per cent) and hypermarkets (75-80 per cent).
The organized segment is expected to account for 25 per cent of the total sales by 2011.
There is a paradigm shift from traditional forms of retailing into a modern organized
sector. Mall space, from a meager one million square feet in 2002, is expected to touch 40
million square feet by end-2007 and an estimated 60 million square feet by end-2008.
The number of operational malls is estimated to be more than double to over 412 with
205 million square feet by 2010 and further 715 malls by 2015, on the back of major
retail developments even in tier II and tier III cities in India. India's luxury market,
estimated to be the 12th largest in the world. It is growing at the rate of 25 per cent per
annum.
The Indian luxury retail market is estimated to leap-frog from around $ 3.5 billion to $
30 billion by 2015. The branded segment comprises $ 701.7 million of the total kids'
apparel market-size of over $ 3 billion. Kids' retailing segment is expected to touch
annual growth of 30-35 per cent. Internet promotes e-tailing-the online version of retail
shopping. An estimated 10 per cent of the total e-commerce market is accounted by etailing. The e-tail market is estimated to grow by 30 percent to $ 273.02 million in 200708, from $ 210.01 million in 2006-07. Retail franchising has been growing at the rate of
60 per cent in the last three years and is set to grow two-fold in the next five years. Rural
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retail market is estimated to cross $ 45.32 billion mark by 2010 and $ 60.43 billion by
2015 India's vast middle class with its expanding purchasing power and its almost
untapped retail industry are key attractions for global retail giants wanting to enter new
markets2.
The Indian retail industry has strong linkages with the economic growth and development
of the economy. It is primarily characterized by its hierarchical growth structure, high
working capital requirements etc. The factors such as rising urbanization, growing

consumer class, growing per capita expenditure, greater interest evinced by the Venture
capitalists / Private equity firms in the industry etc. have been driving the growth of
organized retail. The growth of modern retailing has led to the emergence of varied
formats such as Departmental stores, Supermarkets etc. In addition, few other formats
such as rural retailing, E-retailing, luxury retailing etc. too have found favors with the
Indian retailers. Each format being distinct from the other, the viability of their operations
depends upon various factors such as average footfalls, sales per sq.ft etc. However the
numerous licensing requirements as compared to other countries have proved to be a
bottleneck in the growth of Indian retailing3.
Growth in organized retail:

In sharp contrast to the global retail sector, retailing in India though large in terms of
size is highly fragmented and unorganized. With close to 12 million retail outlets India
2
3
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has the largest retail density in the world. CII Mc Kinsey Report titled 4
however, most of these retail outlets belong to the unorganized sector. The inability of the
Unorganized sector to offer a wide range of products along with artificially inflated costs
due to Various factors have presented opportunities for growth in the organized retail
sector Migration from unorganized to organized retail has been visible with economic
development in most economies.
The Indian retail industry is evolving in line with changing customer aspirations across
Product groups, with modern formats of retailing emerging. Organized retail derives its
advantages in Generating operational efficiencies while simultaneously catering to rising
consumer aspirations. Size drives economies on procurement, and lowers logistics and
marketing costs while delivering better value to customers in terms of lower price, better
quality, greater selection, improved service and in store ambience.

Drivers for retail transformation in India:

A number of factors that drive transformation in retail such as income growth, changing
demographic profiles and socio-economic environment are already in place in India.
However, organized retail has to overcome significant challenges in terms of regulations
and infrastructural barriers in order to realize its full potential. Availability of quality

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retail space has been one of the main constraints for development of organized formats in
India. In the past, negative yield spread on leased property and lack of bank funding due
to unorganized property market resulted in a dearth of quality retail space in the country.
The spread between yield on property and its financing cost has turned positive with the
fall in interest rates. Attractive yields on investments have resulted in sharp increase in
property development. Consumerism and brand proliferation has been another enabler for
organized retailing in India. Most of the worlds leading brands are now present in India.
Challenges for organized retail:

There exist differential sales tax rates across states in India .This adds to cost and
complexity of distribution as this necessitates multiple warehouses and does not allow for
centralization of certain procurements given the incidence of local levies. At the same
time, there is large-scale sales tax evasion by smaller stores who derive significant cost
advantage through such evasion. The retail sector has not been granted industry status,
limiting funding from banks and financial institutions.
The capital requirements for a retailer are in real estate (which banks have historically
restricted lending to) and for working capital requirements. While some of the leading
retailers are still able to get bank funding, the smaller ones are constrained for growth
funding.
Similarly, equity options are also restricted with Foreign Direct Investment not being
permitted in the retail sector. FDI restrictions have also restricted entry of international
majors in retailing in India, which could have otherwise helped the industry develop with
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funding as well as bringing in of best practices and systems. The availability of trained
manpower poses a key risk for the retail sector. The ability of the retail business to hire
and retain quality people is under pressure. Supply chain management efficiencies are
essential to retailers to maintain and improve margins. In India, both vendor management
and logistics management are still undeveloped. However, with growing size of
operations, supply chain efficiencies will become a key differentiator of profitability in
retail5.

5
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About Vishal Mega Mart

Vishal retail limited start with one store enterprise in 1986 in Kolkata (Erstwhile
Calcutta) is today they have 10 warehouses that cater to 180 showrooms in 24 states/100
cities6. Indias first hyper-market has also been opened for the Indian consumer by Vishal.
Situated in the national capital Delhi this store boasts of the single largest collection of
goods and commodities sold in one roof.
Vishal Mega mart is a major industry in retail sector. It serve
vast range of product to our customer like cloth, fashion
accessories, food & grocery, footwear, beauty products etc.
Vishal mega mart is one of fastest growing retailing groups in
India.
Its outlets cater to almost all price ranges. The showrooms have over 70,000 products
range which fulfills all household needs, and can be catered at one roof. Vishal have
centralized purchasing system, due to this they can able to provide good quality of
product at competitive price to our customer.
They believe that Quality Control is the key to success. Their goal is to give the customer
with the best quality and value for his money.
Vishal mega mart have own distribution network and logistics to perform all the activities
to ensure that goods are dispatched in right quantities and sufficient time in the hand to
promptly fulfillment of customer demand and optimum level of inventory at all the
stores.
6
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Objectives
In order to conduct the study I defined the research objectives as follow:
1. To study the inventory management technique used by Vishal Mega mart
This objective is defined to have a preliminary study about the functioning of
inventory management of Vishal Mega Mart.

2. To know the effectiveness of inventory management technique followed by

Vishal Mega mart- This objective is defined to know what advantages they are
receiving for using these inventory management techniques use by Vishal Mega
Mart.

3. To suggest suitable improvement in existing process of inventory

management - This objective is defined to provide some suitable solution for
more effectively management of inventory in the Vishal Mega mart.

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Scope of the study

The strong inventory management technique provides facility to maintain adequate

level of inventory at the store. With the help of adequate inventory level they optimize
our inventory position & reduce overall inventory cost. With the help of this organization
can control working capital requirement.
The research report will provide the facility to know how retail industry make proper
control over the inventory, so they can able to make proper balance between demand and
supply. The research report will also used in similar kind of retail industry, those who are
in the same business.

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LITERATURE REVIEW
In order to conduct this study an extensive literature review was done to get insight into
the research question. The literature review was conducted by accessing the resources
from published literatures. Total seven literatures for relevant aspects of research
problems were reviewed in this study.

Mr. Linda Mullinix, Mr. Shannon Cunningham (2007) did their study on
effectiveness of inventory management in the organization. This study has been organized
under four macro topics, consistent with the study scope.

1.
2.
3.
4.

Customer Service Level

Carrying Cost of Inventory
Inventory Turnover and Return on Investment
Excess Inventory and Shrinkage

Within these four macro topics, eight key findings emerged:

Successful organizations recognize the criticality of customer service level. For this
reason, they measure customer service level on a regular, ongoing basis. Establishing
customer service level goals and having a program in place to achieve those goals creates
a win-win environment for the entire supply chain. Due to their substantially different

Page 28

markets, all companies use unique solutions, formulas, and methodologies successfully
for demand forecasting and determining safety stock quantities.
Open and continuous communication across the inventory management process is
extremely important to inventory management success. They are realize that carrying cost
of inventory is a critical aspect of their inventory management processes. All study
participants consider turnover a less important measurement than customer service level
and return on investment. They are favor a single source of supply for as many products
as possible to improve the consistency of products offered to customers and to reduce the
number of stock keeping units (SKUs) maintained in inventory. They found excess
inventory as a major challenge and have a programand dedicated peoplein place to
remove and liquidate excess inventory and dead stock.

Mr. Sunil Babbar Mr. Sameer Prasad did their study on International purchasing,
inventory management and logistics. Liberalization of economies and the lowering of
trade barriers are ushering international operations into an era of unprecedented growth.
Consequently, there has been a dramatic increase in the cross-border inter- and intracompany transfer of goods. As global transactions increase, international purchasing,
inventory management, and logistics, all take on added significance. Further, increased
operations in international markets bring additional issues such as variations in
government policies, quality of infrastructure and nature of supply base, etc., to the
forefront.

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To compete more effectively in a global marketplace, it is important that firms understand

these issues and align their purchasing, management of inventories, and distribution
systems to the diverse environments in which they operate. Proper management of these
systems can help strategically transform firms into world-class competitors.
While much has been written on international purchasing, inventory management and
logistics, published research in these areas is sporadic. No systematic attempt has been
made to lay the foundation for a comprehensive awareness and understanding of research
in these areas..
Wedad Elmaghraby Pinar Keskinocak School of Industrial and Systems
Engineering Georgia Institute of Technology did their research on Dynamic Pricing in
the Presence of Inventory Considerations & use of decision support system in
management of inventory in various organizations like airlines, hotels and electric
utilities. They are using various information technologies for forecasting the demand.
Three factors contributed to this phenomenon: the increased availability of demand data,
the ease of changing prices due to new technologies, and the availability of decisionsupport tools for analyzing demand data and for dynamic pricing. Determining the right
price to charge a customer for a product is a complex task, requiring that a company
know not only its own operating costs and availability of supply but also how much the
current customer values the product and what future demand will be.
Therefore, in order to charge a customer the right price, a company must have a wealth of
information about its customer base and be able to set and adjust its prices at minimal
cost. Until very recently, neither element was present; companies had limited ability to
track information about their customers. Tastes, and faced high costs in changing prices.
Page 30

Technology allows retailers to collect information not only about the sales, but also about
demographic data and customer preferences. Due to the ease of making price changes on
the Internet, dynamic pricing strategies, especially in the form of price markdowns, are
now frequently used in B2C as well as B2B commerce by numerous companies,
including Fair Market, Comp USA, Lands, End, J.C. Penney, MSN Auction and Grainger.
Brent D. Williams, Travis Tokar did their study on future direction on inventory &
supply chain management. They write logistics can generally be identified by its focus
on optimizing business activities related to the efficient flow and storage of inventory,
goods, and services throughout the supply chain. They provide two major findings
focused on inventory management. First, logistics researchers have focused considerable
attention on integrating traditional logistics decisions, such as transportation and
warehousing, with inventory management decisions, using traditional inventory control
models. Second, logistics researchers have more recently focused on examining
inventory management through collaborative models7.
Prerna Jhunjhunwala did the analyses of overall performance of Vishal retail limited on
(March 26, 2008). Prerna jhunjhunwala analyses the reason for growth of Vishal Mega
Mart in the retail industry.
Vishal Retail Ltd, incorporated in 2001 by Mr. Ram Chandra Agarwal, is in the business
of value retailing with focus on Tier 2 and Tier 3 cities. At present, the company operates
92 stores under the name Vishal Mega mart with a retail space of 2 mn sq.ft. To ensure

7
Page 31

strong logistics support, the company established 29 warehouses in 8 cities with total
space of1.05 mn sq.ft. and a fleet of trucks for transportation.
As on 2008, Vishal Retail operates 29 warehouses in 8 cities with a space of 1.05 million
sq ft. The company has 8 distribution centers in different zones, where all the products
are stored. As a result, it maintains less space for storage in the retail stores enabling
better utilization of space. Majority of the warehouses are located in northern region due
to its concentration (approximately 62% of sales in FY07) 8 in the concerned zone. Since
the presence in the south is very small, the requirement from the southern India is catered
by the distribution centre in west.
The company also maintains a fleet of more than 50 trucks for transportation of products
to distribution centers and from distribution centers to retail stores. It also uses the
services of low cost logistics service providers to deliver products on time and optimizes
transportation cost. We believe that the strong logistics and distribution network will
enable the company to keep transportation cost in control and improve inventory
management.
The inventory requirement of the company is increasing year-on-year as it is in growth
phase. Since the company is expanding at a very rapid pace, it has to keep inventory not
only for old stores, but also for new stores and for stores which have not yet started. This
results in high inventory requirement which takes time to convert into sales. Also the
company is expanding in all the zones of the country, whereas its warehouses are located
at few selected cities. This results in high inventory requirement at the distribution

8
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centers and the transit period of goods is nearly 3-4 days. With the expansion going on,
we expect the inventory turnover to decline for at least 3 years. As the pace of expansion
slows down after 3 years, the inventory turnover may increase resulting in faster
conversion of inventory into sales9.
Vishal Retail operates two manufacturing facilities with a capacity of 1.5 mn pieces each.
The Gurgaon manufacturing facility began operations in 2004 and currently operates at
80% utilization. The Dehradun facility, currently operating at 40% utilization,
commenced operations in September 2007. The company also makes FMCG products,
like namkins, farsans, ketch-ups, etc., through a bakery in Gurgaon. The in-house
manufactured products enable improvement in operating margin. In FY06, the products
manufactured by company contributed 9.7% to sales. This contribution is decreasing
every year due to inclusion of other categories in the product mix.

Vishal retail limited main focus is on the value retailing segment, targeting the middle
and lower middle income groups, which constitute majority of the population in India. At
present 80 out of the 150 stores of the company are located in Tier II and Tier III cities.
This strategy enables it to capture market share in these locations where majority of its
target customers are located and there is less of competition from the other branded
retailers who normally do not have a presence in many of these locations10.
Supply chain management of Vishal mega mart involves planning, merchandizing
sourcing, standardization, vendor management, production, logistics, quality control,
9
10
Page 33

pilferage control replacement and replenishment. Our supply chain management

provides us flexibility to adapt to changing patterns in consumer behavior and ability to
add value at various steps/levels. In particular, our supply chain management gains
strength from our ability to undertake in-house manufacture, design and development of
apparels.
The companys operating margin is higher than to peers due to owned manufacturing
capacity of apparel, higher proportion of apparel in the sales mix (60%), and sales of
private labels only in apparels, high share of private labels in the sales mix, efficient
supply chain and distribution system and low rentals.
Vishal Retail operates 29 warehouses in 8 cities with a space of 1.05 million sq ft. The
company has 8 distribution centers in different zones, where all the products are stored.
As a result, it maintains less space for storage in the retail stores enabling better
utilization of space. Majority of the warehouses are located in northern region due to its
concentration in the concerned zone. Since the presence in the south is very small, the
requirement from the southern India is catered by the distribution centre in west.
The company also maintains a fleet of more than 50 trucks for transportation of products
to distribution centers and from distribution centers to retail stores. It also uses the
services of low cost logistics service providers to deliver products on time and optimizes
transportation cost. We believe that the strong logistics and distribution network will
enable the company to keep transportation cost in control and improve inventory
management.
Vishal mega mart is able to reduce operational cost; this is due to the company strategy of
opening stores in Tier-2 and Tier-3 cities, where the rental cost is low. In tier-1 cities, the
Page 34

company opens stores only in the outskirts of the city, where the rental cost is much
lower than the prime area. Moreover, the company prefers opening stores in readymade
buildings rather than malls to reduce rental cost. These entire initiatives enable the
company withstand intense competition. We do not see much increase in the rental cost
going forward due to this strategy.
Rati Pandit did our study on performance of various stores of Vishal Mega Mart in June
12, 2006 on the issue of inventory management. She also studies about the supply chain
management of Vishal mega mart related to efficiency of distribution of stock to various
stores in India. In order to reduce costs and take advantage of economies of scale VRL
has embarked on backward integration of its products by setting up one apparel
manufacturing plant in Gurgaon. Besides this it has set up 7 regional distribution centers
for ensuring efficiency of supply chain. The company has developed a cost and time
efficient distribution and logistics network and has a fleet of 50 trucks for the fulfillment
of the same.11
Chao Li (2006) did our study on use of information technology in the
management of inventory in the organization. They said with rapid growth of humancomputer interaction, more and more useful software are replacing human efforts. The
system on which they propose this report, integrates the idea to automated , instead of
manually, manage inventory of a restaurants liquor, meanwhile it can generate sales
report, inventory report, etc, which all require human efforts previously. As a result, this

11
Page 35

new system can reduce possible human errors and provide accurate information of
inventory at any point.
The Automated Inventory Management System is implemented with the latest
Java technology utilizing extended swing library which makes layout easy to use and
eliminate much of the tedious code to generate swing form.
They are included in their report that, there should be a lot more features that can
add to the Automated Inventory System. One of them is networking which allow several
other computers to access database simultaneously without interrupting each other.
Therefore the database should include the features of ACID which stands for Atomicity,
Consistency, Isolated and Durability. Furthermore, the sales report can be exported to
excel file which can be saved independently. When users of AIM generate sales report,
they have choices of either printing out directly or export to generate extra excel file that
can be viewed using MS Excel. Nevertheless, AIM is just the beginning of inventory
management system12.

Yen-Chun Wu did their study on topic of Internal Lean Manufacturing Practices and
JIT Logistics. They study about how JIT is helpful in management of inventory in the
organization & what are the benefit are associated with it. The study was done on
automobile industry. Yen-Chun Wu says Logistics or supply chain management refers to
the art of managing the flow of materials and products from source to user. JIT is a
comprehensive philosophy designed to increase quality and eliminate waste through the
12 Cay S. Horstmann and Gary Cornell, Core Java Volume II-Advanced Features, 2001

Page 36

whole process. According to Levy, JIT delivery and low inventory are the heart of lean
production. First, lean manufacturing requires rapid delivery from suppliers in order to
avoid very high inventories. Second, a minimized inventory and substantially reducing
sourcing, production, and delivery cycles will require manufactures to create
uninterrupted materials of high quality parts from sourcing to manufacturers to market.
In order to reduce costs and provide better service to the shippers, suppliers are relying
extensively on information technology such as electronic data interchange. Our study
provides evidence that Electronic Data Interchange (EDI) plays an important role in
supply chain management. Supply chain management emphasizes vendor responsiveness,
flexibility, and dependability as a means to improve customer service and logistics
productivity. Timely and accurate information exchange between supply chain partners is
essential for responsiveness, flexibility, and dependability. The results indicate that for
lean suppliers, the need to track the status and location of shipment is increasing as more
companies implement JIT or other inventory-reduction programs. Overall, our results
show that lean suppliers use more EDI than non-lean suppliers.
The study also provides evidence that lean suppliers are able to reduce logistics costs
over time as compared to non-supplier firms. Much of the existing literature in
purchasing, materials, production and inventory management pays attention to the
benefits to the supplier firm in terms of reductions in manufacturing costs. Our results
suggest that the benefits of long-term relationships go beyond just manufacturing
efficiencies13.
13

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Matt, Johnson and Davis defined the Vendor Management Inventory policies as special
quick response case based on push principles. In this model the supplier manages
inventory for the retailer, it takes responsibility for setting target inventory levels and
making restocking decisions. By receiving electronic messages with sales information or
warehouse shipments, the supplier assumes responsibility for replenishment retail
inventory in the required quantities.
This strategy tries to reduce the effect made by demand variability changing the order
frequency for getting a smooth inventory flow reducing the investment on holding it and
improving the resource utilization such as transport an production resources.
But the supplier and its customers needs to speak the same language for getting the
goals written above. That means all of the participants of VMI relation must have a
common information platform or at least some kind of software and hardware
combination that can translate the messages between them. Some of those solutions are
quite expensive and in some cases confidential information must be shared14.

14

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RESEARCH METHODOLOGY

Introduction
Research methodology is a way to systematically solve the research problem. It may
understand as a science of studying how research is down scientifically15.
In order to provide conclusion with regard to the topic of the study inventory
management technique used in retail industry-A case study of Vishal Mega Mart. The
research methodology consists of research design, area of study, sampling technique &
method of data collection. It is necessary to adopt a suitable mode for the study. The
personal interview of Store manager (Vishal Mega Mart) is conducted for analyses the
given problem.

Research Design: -

A research design is the arrangement of conditions for

collection & analyses of data in a manner that aims to combine relevance to the research
purpose with economy in procedure.
15
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To fulfill the objective of project, descriptive research design has been adopted. A
descriptive research design concern about describing the characteristics of a particular
individual or of a group, or describing the characteristics of a problem. The major
purpose of descriptive research is description of the state of affairs at it exists at present.

Area of study: - It is define as any geographical location or any particular place in

which research work is performed by research. My Area of study is confined to only
Vishal Mega mart, Bareilly for completing my research project report.

Sampling design: - A sample design is a definite plan for obtaining a sample from
a given population. It refers to the technique or the procedure the researcher would adopt
in selecting items for the sample. In my research project report I use Convenience
sampling technique for the collection of data. It is very helpful in collection of data
according to our requirement. It also helpful in collection of appropriate data in short
time period.

Research tool: - For collecting the data I take Personal interview of store manager
of Vishal Mega Mart.

3.6:Collection of Data: -

There are two sources for collection of data these are

(A) Primary source, (B) Secondary source.

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Secondary source: - secondary data means data that are already available & analyses by
someone else. In my research study the information obtains from secondary source. The
secondary data collected from the concerned authority (Store manager Vishal Mega mart)
by personal interviewing.

Questionnaire Characteristics:
Q.1)

Does your organization follow any inventory management technique?

With the help of this question I am able to know, whether Vishal mega mart is
using any kind of inventory management technique or not.

Q.2)

What type of inventory management technique do you follow?

This question provides me the facility to know, what type of inventory
management technique they are using.

Q.3)

On what basis the method is selected for managing inventory?

It provide the facility to know the selection method used by managing the
inventory

Q.4)

Which type of ordering system is followed?

It is helpful in knowing what type of ordering system they are following

Q.5)

Do you use any technology or software for managing inventory? If yes, please
mention?
This question provides me the facility to know whether they are using any IT
software for managing the inventory.
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Q.6)

Have you analyzed the impact of inventory management on cost reduction?

This question provides me the facility to know whether Vishal mega mart
receiving any benefit from inventory management or not.

LIMITATIONS

Some of the limitations of research project report are listed

below:
1. The researches require dept study, but due to time constraint dept study of given
problem is not possible.
2. All the information provided by the store manager and all the analyses are based
on this information.
3. The study is confined to only vishal mega mart , Bareilly

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Data Analysis

Q.1) Does your organization follows any scientific inventory management

technique?
a) Yes
b) No

Response: - The store manager said that yes we are follow scientific method inventory
management

Interpretation:
They follow scientific techniques for inventory management in Vishal Mega Mart,
Bareilly. Due to this they are able to manage our inventory effectively & efficiently.

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Q.2)

What inventory management methods do you follow?

a) EOQ (Economic order quantity)
b) Selective inventory control techniques
1. ABC
2. FSN

3. VED
4. Other

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5.

Response We are using selective inventory management technique with in this

we are using ABC & FSN.

6.
7.
8.
9.

20%

ABC
FSN

80%

10.
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11.
12.

13.
14.

Interpretation:

15.

In Vishal Mega mart for optimizing the inventory cost they are follow selective

inventory control technique ABC Analysis for keeping goods according to their value and
consumption rate.
16.

17.
18.

ABC classification:

19.
20. ABC stands for always better control. The items on hand are classified
into A,B,C and types on the basis of the value in terms of capital or
annual Rupees usage (i.e., Rupees value per unit multiplied by annual
usage rate), and then allocates control efforts accordingly. Thus, the
items with high value and low volume are kept in A-type, items with low
value and high volume are kept in C-type, and the items with moderate
value and moderate volumes belong to the B-type gets the moderate
attention. Typically, three classes of items are called: A (very important),
B (moderately important), and C (least important).
21. The actual number of categories varies from organization to
organization, depending on the extent to which a firm wants to
differentiate the control efforts. With three classes of items, A items
generally account for about 15 to 20 percent of the number of items in
inventory but about 60 to 70 percent of the Rupees usage. At the other
Page 46

end of the scale, C items might account for about 60 percent of the
number of items but only about 10 percent of the Rupees usage of an
inventory.
22. A type items should receive close attention through frequent reviews of
amounts on hand and control over withdrawals to make sure that
customer service levels are attained. The C type items should receive
lesser control (e.g. two-bin systems, bulk orders), and the B type items
should have controls that lie between the two extremes.
23.

24.
25. FSN Classification:
26.
27. In this method, the items are classified according to the rate of
consumption. Thus, the materials can be fast (F), show (S) and nonmoving types (N). F-type materials get the maximum attention and the
N- type the minimum for their control and procurement. This concept is
also applying in Vishal mega mart retail store. Let the different items in
Vishal mega mart are: mobile phones, cosmetics, footwears, jewellery,
suitcase, ladies wrist watch, toys, household appliances, shaving blades,
Rice, pulse, salt, sugar, tea wound plasters, and dry-fruits.
28. According to FSN, they can be classified as F = Rice, pulse, salt, sugar,
tea and some other daily needs items are consumed almost daily at
relatively faster rate and they need more attention to avoid stock-out
Page 47

situation in the store specially if some unexpected demands of

customers. S = suitcase, ladies wrist watch, toys, household appliances,
Mobile phones , are consumed at a moderate speed and need moderate
attention.
29. N = jewellery, and some costlier items are consumed at a very negligible
rate and need attention. They can be bought and can be consumed
leisurely when need arises.
30. The same concept can be extended to industrial or war situation. For
example, the bullets are fast moving items but a nuclear bomb is almost
a non-moving item. In fact it may never be used but it consumes lot of
revenue. Such items are sometimes called insurance items as they ensure
a kind of deterred and may prevent a war between two nations just by
their presence.
31.

32.
33.
34.
35.
36.
37.
38.
39.
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40.
41.
42.
43.
44.
45. Q.3) On what basis the method is selected for managing inventory?
46.
47.

a)

Universal

b)

Product category wise

48.
49. Response: - for managing the inventory in organization we are using
product category wise.
50.
51.

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52.

0.04

Product categorywise
Universal

0.96

53.
54. Intrepretation:

55.
Page 50

56. According to the product categories they are using ABC technique for
various category of product in Vishal mega mart like home furnishing
items, sports &fitness equipments, footwear, mobile phones, travel
accessories, stationary, garments etc.
57. Q.4) Which type of ordering system is followed?
58.

a)

Periodic ordering system

59.

b)

Fixed quantity ordering system.

60.
61. Response : -The store manager of Vishal Mega Mart says we
implement Periodic ordering system for placing the inventory order.

62.
63.Interpretation:
64.
65. In Vishal Mega mart Periodic Ordering system is used in which ordering
time is fixed but order quantity are not fixed. As in Vishal Mega Mart
they sent their orders every week as per the requirements.
66.

67.

Periodic Ordering System:

68. The ordering system used is P system also known as Periodic Review
system or fixed Interval system. In this system the size of order quantity
may vary with fluctuation in demand but the ordering interval is fixed.
69. It is based on periodic reordering of all items. With every cycle the stock
of each item is brought up to its level, which is dependent on the cycle,
the replenishment period, and the consumption rate. When the

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replenishment period and demand rate do not change, the reorder

quantity obviously increases with the cycle time, so that short cycles are
required if rapid turnover of stock is desirable
70.
71.
72.

Advantages over Two Bin System

All orders for replenishment are issued at the same time.

Ordering mechanism is regular and not subject to sporadic arrivals of warning

signals from the store.

73.
74.Disadvantages:

Usually more stock is held when this system is adopted than with the 2-bin
system. Following variations of ordering cycle system are possible.

(i)

All items one cycle

All the items are replenished in every cycle. This is useful when the number of
items is not too large, and differences in demand are not very significant.

However, in this system the average stock level tends to increase with the number
of items.

(ii)

Multi cycles
The items are divided into groups and each group has its own ordering cycle,
independent of the other groups. The groups are formed either by selecting goods
that to be ordered from the same vendor or by taking items with similar demand
characteristics.
Page 52

The system is adopted when the stores have to deal with a large number of items.
75. In case of some daily needs items mostly those which are edible and
perishable like vegetable oils, spices, milk, butter, etc. they make local
purchases from nearby markets like shyamgang, kutubkhana mandi, etc.

76.
77.

Q.5)

Do you use any technology or software for managing inventory? If

yes, please mention.

A. DSS
B. SAP
C. Other
78. Response : - The store manager of Vishal Mega Mart says Yes we are
using information technology in the organization, the SAP Software is
used by organization.
79.

80.Interpretation:
81. The chain of superstores, Vishal Mega Mart, has selected SAP to
improve its business processes and create a strong and adaptive
environment for business growth and profitability. This state-of-the-art
system will enhance critical processes including global sourcing,
distribution, logistics, product innovation, inventory visibility, financial
transparency, compliance and point-of-sales data management.

82.
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83.
84.
85.
86.
87.
88.
89.
90. Q.6) Have you analyzed the impact of inventory management on
cost reduction?
A. Yes
B. No
91. Response : - The store manager of Vishal mega mart said that yes we
analyzed our inventory management techniques, and these inventory
management technique provide us reduction in overall cost of inventory.
92.
93.

Page 54

94.

9%

YES
NO

95.Interpretation:
96.

Page 55

97. The store manager of Vishal mega mart said that We analyze the effect
of inventory management on cost reduction & that is beneficial for the
organization.

98.
99. Q.7) How much percentage of inventory cost is reduced by following
these techniques?
A. 5% -10%
B. 10%-15%
C. 15%-20%
D. 20%-25%

100.

Response: - C.

The store manager of Vishal Mega Mart says

with the help implementing inventory management technique we are

able to reduce overall inventory cost by 15%-20%.

101.
102.
103.
104.
105.
106.

Interpretation:
The store manager said that by using various inventory control

techniques we able to reduce total inventory cost by 15%-20%.

107.
108.
109.
110.
111.
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112.
113.
114.
115.

Q.8) What problem you are facing in management of

inventory?

116.

117.

Response: - The store manager of Vishal Mega Mart says we are

facing various problems in management of inventory in the organization

these are Shoplifting, Damage, expiry & damage in transit etc

118.
119.

Interpretation:

120.

The store manager of Vishal mega mart said that we are facing

many of problems while managing the appropriate inventory position in

the organization like. Due to Shoplifting by the workers of the
organization they are facing the problem of shortage of inventory in the
organization & not able to make appropriate level of inventory in the
organization. Damage is also creating the problem in management of
appropriate inventory level in the organization.

121.

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122.
123. CONCLUSION
124.
125.

In the conclusion it can be said that the Vishal Mega mart Bareilly

is using various qualitative as well as quantitative inventory management

techniques ABC & FSN etc for different product categories and they also
uses SAP solution which helps in effective Management of Inventory.
On the basis of findings and analysis the overall Conclusion can be
drawn as the Vishal Mega mart Bareilly is able to reduce the Inventory
cost as well as efficiently managing their replenishment system.
126.

As I study them & they are managing their inventory very

effectively, but then also they are facing many of problems in the
management of inventory in the organization, some of them are
controllable and some are uncontrollable variable.
127.
128.

129.
130.
131.
132.

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133.
134.
135.
136.

SUGGESTIONS
137.

Even though the inventory cost is reduced by the different qualitative and
quantitative techniques used but they should also go in much detail of even small
product categories.

In case of periodic Ordering system it may leads to the stock out situation due to
uneven demand, so they should follow the perpetual system which keeps track of
removals from inventory on a continuous basis. When the amount on hand
reaches a predefined minimum quantity, a fixed quantity is then ordered. This
system provides continuous monitoring of Inventory withdrawals and the setting
of optimal order quantity.

Organization should take proper watch over employee, so the shoplifting should
be minimize.

In case expiry of goods Organization should use sales promotional scheme when
the stock reach nearby expiry date. Due to this utilization of inventory should
possible.

138.

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139.
140.
141.
142. BIBLOGRAPHY
143.
144.

For colleting the information regarding my project repot on the

topic Inventory management technique used in retail industry A Case

study of Vishal Mega Mart I am use different books, Journals, websites.
The references given blow:145.

Books

1. V.K.Kapoor, Operations research Techniques for management, Edition-7(2007).

2. C.R.Kothori, research methodology (methods & techniques), edition(2009).
146.
147.

Journal

1. Crum, M. R., G. Premkumar, K. Ramamurthy (1996). An Assessment of

Motor Carrier Adoption, Use, and Satisfaction with EDI. Transportation
Journal Summer:
2. Brent D. Williams, Travis Tokar the International Journal of Logistics
Management (2010) Opportunities for behavioral research in logistics and
supply chain management, Volume 21 Issue 1.
148.
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149.
150.
151.
152.
153.

Website

154.
1. A survey report of business.mapsofindia.com (last accessed 23.3.2010)
2. www.indiaretailshow.com/Industry (last accessed 23.4.2010
3. snipsly.com/2010/03/11/report-on-Indian-retail-industry
4. www.slideshare.net(Retailing in India, the Emerging Revolution)

155.
156.
157.
158.
159.
160.
161.
162.
163.
164.
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165.
166.
167.
168.
169.
170.
171. ANNEXURE
172.
173.
174.

H.

Q.1)

Does your organization follow any inventory management technique?

A. Yes
B. No
C.
D.
E. Q.2)
What type of inventory management technique do
you follow?
A. EOQ (Economic order quantity)
B. Selective inventory control techniques
a) ABC
d) Others
b) FSN
e)
c) VED
f) Q.3)
On what basis the method is selected for managing
inventory?
A. Universal
C. Other
B. Product
D.
E. Q.4)
Which type of ordering system is followed?
A. Periodic ordering system
B. Fixed quantity ordering system.
F.
G.
Q.5) Do you use any technology or software for managing inventory? If yes,
please mentionA. DSS
C. Others
B. SAP
Page 62

F.

D.
E.
Q.6) Have you analyzed the impact of inventory management on cost
reduction?
A. Yes
B. No

Page 63

C. Q.7)
How much percentage of inventory cost is reduced by
following these techniques?
A. 5%-10%
B.
10%-15%
D. 15%-20%

D.

20%-25%

E.
F.
G.

Q.8)

What difficulty you are facing in management of inventory?

H.