Virtuous Retail: Ideal partner for retail players

Studies validate, that India’s retail sector accounts for about 14 to 15 per cent of the country’s GDP; and employs about 40 million people. With the opening up of the economy, India features high on the list of priority markets for several international luxury retail brands. There is also a hot debate regarding the issue of FDI. However, it goes without saying that lifestyle retail is the next big thing, and retail spaces are much in demand.

With retail shopping outlets sprouting across cities, retail management and design is now a specialized field altogether. Virtuous Retail, a unit of The Xander Group Inc., a global leading emerging markets investment firm, is a pioneer in retail management and leasing. With a focus on developing prime zones as commercial hubs and neighbourhood shopping centres, Virtuous Retail also offers services like research, finance, planning, marketing and mall operations, retail space for rent, consumer experience design, and tenant relationship management.

In today’s competitive scenario, it is not enough to provide build retail shopping outlets or give out commercial space on lease. The success of neighbourhood shopping centres depends on crucial factors like right tenant mix to address market gaps, extensive market knowledge, and cost-effective operations for a mutually beneficial and successful relationship between the tenant and the owner. This is where companies like Virtuous Retail bring in their expertise. For example, if a shop is under-performing, then Virtuous Retail would provide in-depth recommendations based on exhaustive market intelligence. Based on these recommendations, the mall can increase lease savings; and the under-performing store can negate losses to a certain extent. This is an example of tenant relationship management that is a forte of Virtuous Retail.

With increased competition, it is imperative that the neighbourhood shopping centre offers a unique engagement proposition to attract footfalls. Whether it is restaurants, entertainment options for weekend crowds, or a quality mix of daily requirements, the mall has to offer a solid consumer experience to make it a popular destination. This is where consumer experience design comes in.

So, what makes Virtuous Retail an ideal partner?
* In-depth local market knowledge
* Strong marketing strategies
* Cost-effective and sustainable mall operation services
* International design benchmarks
* Global experience

In addition to Virtuous Retail’s specialized services, the company’s pan-India portfolio of premium retail space for lease comprises impressive locations in key cities like Surat, Bengaluru, Kolkata, Pune, Mumbai and Udaipur.

So for lifestyle retail and luxury retail players looking for retail space on lease, Virtuous Retail is a perfect partner.

Read more visit websites: http://www.virtuousretail.com/

Virtuous Retail commercial retail sector

Virtuous Retail is a visionary group and has brought in global expertise and trends in building world class retail shopping outlets. It provides retail spaces for rent in prime cities like Bengaluru, Mumbai, Pune, Surat and Kolkata.

But, retail spaces are not only about huge shopping malls, they have a lot more in store. Neighborhood shopping centers for instance have increased more than double in the past four years. These hypermarkets or shopping centers offer a viable and easy alternative to people for everyday needs and entertainment. Similarly, the extreme of neighborhood shopping centers, luxury retail, is another major segment as far as retail spaces go. Reports indicate that the spurring growth of the Indian luxury market, will result in a three times increase in demand for luxury products by 2015. Lifestyle retail is another segment of commercial retail spaces and is gaining immense popularity as well.

Another concept that has gained a lot of prominence in retail construction is that of consumer experience design. This is a process where the quality of user experience is kept at the forefront. It is used to design products, processes, services, events, environments and many more things. Consumer experience design is a new and emerging discipline, and draws inspiration from various fields like cognitive psychology and perceptual psychology.

The retail sector though, is a complex and intriguing one, and has various forces at play. While, putting up retail or commercial space up for lease, the concept of tenant relationship management becomes extremely important. The lease may be negotiated by the developer, but to make this arrangement work smoothly, the tenant and the owner of the retail space, i.e., the developer need to come to agreement with the terms and work in a harmonious environment for the duration of the lease.

Retail Management and leasing also play a crucial role in the commercial retail sector. While, the art of Retail Management revolves around promoting greater sales and customer satisfaction, and can only be achieved by getting a better understanding of the consumers and their psyche. On the other hand, leasing is organized by developers of the commercial property.

With growing disposable incomes and the love to spend increasing, the retail sector in India is only expected to flourish. And, with retail developers doing extensive background and trend research, the properties coming up are easily comparable to international standards. The retail sector has opportuniies galore for everyone involved!

For more info visit: http://www.virtuousretail.com/index.asp

Retail Recruitment Companies Bridge the Gap

The Indian retail market, which is the fifth largest retail destination globally, according to industry estimates it is estimated to grow to US$ 637 billion by 2015. Simultaneously, modern retail is likely to increase its share in the total retail market to 22 per cent by 2015.

The retail industry in India has come forth as one of the most dynamic and rapid-paced industries with abundant players entering the market. Cashing in on the growth prospects, many retail schools are coming up to equalise the demand for professionals with adequate supply. Also more and more students are taking on retail as a career option.

The growing retail sector in India has given rise to acute shortage of well trained retail people. And many a companies have accepted this problem as an opportunity. The market has seen a lot of retail recruitment companies cropping up in the recent times. Retail Recruitment Company is an agency that really understands your business and knows where to find the best talent nationwide for both permanent and temporary requirements. First Serve Communications is one such customer service recruitment agency. It has been placing retail professionals in reputed companies all over India and abroad for over 2 years.

Campus recruitment is the main criteria among students while choosing a retail institute. It is with the knowledge of these that a student can know where he would finally land up. Now all retail education-providing institutes have tied up with various customer service recruitment agencies which in turn have a lot of tie ups with the retailers. In a way it is a bridge between the skilled professionals and the retailers.

Though retailing is a promising career, but to begin with, many students have some resentment regarding the work they would be required to do. Previously there is a notion among them that they would be required to work in a store, which they were not too happy about. “We have not spent four years at a retail school to work in a store”, they often argued. But the perception is widely changing. The students feel that to understand the marketing strategies and the customers, it is very important to be at the front end and interact with them, which is not possible if you directly move into the corporate nutshell.

Retailers might see it as a problem to find the right person to be the first touch point of their brand but many have seen this as an opportunity. Retail business has given birth to another business in the form of proving retail resource solutions to the clients. With a lot of students shaping up their minds to enter the retail firms, this seems to be a win-win situation for both retailers and professionals & retail recruitment companies are ready to extract their share of the pie.

How to Price My Product for Retail: 11 Easy Steps

I am often asked as a consultant, “what is the first thing you will do after I hire you, what’s your plan of attack?”. The answer is simple, pricing. This might seem strange to most people as I am sure you can think of a plethora of other things you would rather have me working on than pricing, however the simple fact is, if your pricing does not work we are finished before even beginning.

Product pricing should be an essential first part of your overall go to market product strategy, however again and again I see companies leaving this to the end and in some cases simply guessing. There seems to be a mystique around pricing a product that often scares companies into a panic and this is where mistakes get made that can cost thousands of dollars down the road. The mystery of margin, program, net, gross, delivered, FOB etc can leave you feeling overwhelmed and therefor uninterested.

Well; not to worry. You can put away your taro cards and cancel your appointment at the physic. We are going to take the mystery out of pricing by showing you:

How to determine MSRP (Manufactures Suggested Retail Price)
How to determine your raw cost
How to determine your raw landed cost
What is MAP pricing and should you use is?
What is gross margin and how to determine it?
What is “Program” and how does it affect your price structure?
What is net margin?
What is adjusted net margin and what should this number be to keep your business moving forward?
How to price your product to best avoid knock offs.
The difference between pricing your product online and pricing it for a retailer.

Alright, let’s get right to it!

1. MSRP – Determining your manufactures suggested retail price is critical to the rest of your pricing strategy. Every retailer, buyer, distributor and etailer will want to know this number as they want to remain competitive with the market. Before simply applying a 6 or 7 multiple to your cost in order to gain your retail I suggest you do some due diligence on your competition. What are the other items in this category selling for? Is your product better, worse or the same as what is on the market. Does your product have features that separate it from the competition and can bring a premium retail price or is it a value offering from the competition and needs to be priced lower. To bring a bit of clarity to this subject let’s create a scenario. Let’s say your company has created a new smart phone case and you need to establish a base MSRP. Your Raw Landed Cost(you will learn this below) on this item is $ 7. If you times your cost by a 7 multiple to gain your retail you end up with a $ 49.99 MSRP. On the surface this MRSP seems to work, however after some research you find the competition has this type of product retailing at $ 39.99. This is where you will have to decide if your product (an unknown) can bring a $ 10 premium to known brands already on the market. If not you will have to bring your retail down to $ 39.99 and rerun it through our proprietary pricing worksheet to see how this new retail affects your over all profit number. At the end of the day please remember this one truth, MSRP is created by the customer. To be more specific your product is really only worth what customers are willing to pay for it and not a penny more which is why pricing is such an important part of the process.

2. Raw Cost – This is the number your company pays for a fully packaged, production quality product at the manufacture. Please note that a production product is not a hand made sample or one of a few sample products run from your factory. A production product is a product pulled directly off the production line ready to go to a retailer. It is this cost you are after.

3. Raw landed cost – This is the number your company pays for a fully packaged, production quality product including the cost of bringing the product to the US if it is manufactured overseas or to your warehouse if it is manufactured somewhere different then where you will be warehousing it. How much should you factor into your product cost to land your product here in the US from overseas? As a rough estimate only, you can take $ 4700 / the units of product that fit into a 40ft container. This will give you a rough idea of how much you should add to your unit cost to have a complete landed raw cost. Please keep in mind this is for rough estimates only, you should replace $ 4700 with your actual cost when you are receiving logistics quotes. Ex. If your the raw cost of your product at the port in China is $ 1.47 and you can fit 10,000 units in a 40ft container your cost per unit to flow the product to the US would be $ .47. This would make your Raw Landed Cost on this item $ 1.94. If your product is manufactured in Wisconsin and your are bringing them to your warehouse in Texas you would simply substitute the $ 4700 for the cost of shipping the product from WI to TX.

4. MAP Pricing – MAP or Minimum Advertised Price is a policy used by some manufactures to create stability in advertised pricing of their product. It means that no retailer or etailer can list or advertise a MAP’d product under the MAP price set by the manufacture. Brick and Mortar stores can sell these items or even list these items in store for any price they choose as long as they do not advertise them for less than MAP. This sound like a pretty good deal and you are probably saying to yourself, “Why wouldn’t I create a MAP policy?” Here are a couple things to consider when making this decision; 1. Once you establish a MAP policy and distribute it to your retailers you must treat each retailer the same irrespective of their volume. This means if you stop supplying a small retailer because they violated your MAP 3 times and this is clearly stated in your policy then you would also have to stop supplying a large big box chain if they did the same or risk a huge law suit, 2. Some retailers simply don’t want to do business with products that are MAP priced as it creates issues with their marketing plans.

5. What is gross margin and how to determine it – Gross margin is the difference between your selling price and your raw, landed product cost. It is generally expressed as both a percentage and a dollar amount. To determine the dollar amount the formula is SP-Cost. To gain your gross margin % you would use the following formula formula: (SP-Cost)/SP. SP = sell price. If your selling price is $ 79.99 and your raw landed cost is $ 27.5 the equation for gross margin dollars would look like ($ 79.99-$ 27.5). Your gross margin dollars would be $ 52.49. To gain your gross margin percent the equation would look like this ($ 79.99-$ 27.50)/$ 79.99. Your gross margin for this item is 65.62%.

6. What are program costs – Program costs can be considered any additional cost the retailer is going to ask you to be responsible for paying. These costs should be built into your cost structure prior to quoting. Not taking the time to understand these costs of build them into your cost structure prior to quoting pricing to a retailer is a recipe for disaster. Your company must be able to incur these costs and still produce a healthy margin. Some common program costs are:

Returns allowance – A retailer might ask for a % off invoice to cover any returns. This % can range from 2%-10% depending on the product.
Freight – At times retailers will ask for a “Delivered Cost”. Delivered cost means that you will have to pay to deliver the product to the retailer therefor you must factor this cost into your pricing structure.
MDF – MDF stands for Marketing Development Fund. This would be money that your company would accrue for future promotional opportunities or a retailer will require that you contribute to a fund.
Mark Downs – This is a fund you would accrue for use in liquidating slow moving inventory from a retailer. Many times retailers will not mention this, but will come to you later asking for money to help move stagnate product. It is best to accrue for this on your own so you have money when the time comes. For example; some club stores do not transfer merchandise from warehouse to warehouse which means you might get an order from warehouse A, while getting a markdown request from warehouse B only 5 miles away.

It is important to note that some retailers will negotiate program costs with you upfront and will deduct the negotiated percentage direct from the invoice when paying you. Other retailers will not negotiate this upfront, but will still make deductions from your invoice when paying.

7. What is Net Margin – I calculate Net Margin is your “Gross Margin” minus all of your program costs.

8. What is adjusted net margin and what should this number be to keep your business moving forward – Adjusted net margin is your “Net Margin” minus any rep or broker commissions. If possible always insist that you pay commissions on net margin. In some cases the broker or rep will be the one negotiating the program costs and he or she will be more likely to negotiate better on your behalf if their commission is affected. Achieving the best ANM will depend on several factors including your business structure and volume. Generally I like to see Club Store ANM above 25%, regular Big Box above 35% and Specialty retail above 45% if possible.

9. How to guard against knock offs by pricing your product correct the first time – Today’s manufacturing is much different then in years past. It is very common for companies to have product produced overseas, a world away from where their company resides. It can be costly to spend the needed time overseas to manage the manufacturing process and as a result companies send their product ideas to overseas factories in an effort to get product produced cheaper and more efficiently. The most common fear I hear when companies are shopping for a factory to produce their goods is they do not want to get knocked off. While this is a legitimate concern it cannot keep you from moving forward. There are two strategies, I believe, will give you the best protection against knock off product if it shows up.

If at all possible be first to market and establish your product brand as the authority as quickly as possible. In the bedding market there are plenty of competitors to Tempurpedic, however customers still prefer the Tempurpedic brand over the competition as they were first to really bring memory foam mattresses to market in a big way. Price your product to be competitive right from the beginning. Gouging the customer simply because there is no current competition will not serve you in the long term. When the knock offs come calling, and they will, the buyers who carry your product will be reluctant to change if the difference in price is not more than 15%. However, if you went out with high cost and the competition is now knocking at a much lower cost and retail, the buyers will be more likely to seriously consider it.

10. The difference between pricing your product on your website and pricing it for a retailer. – Many retailers will begin by selling their products on their own retail website, which I encourage with all my clients. I am always reluctant to work with clients who are not willing to sell their own products directly to the customer. When selling online the pricing formula is simple. It costs X to make my product, I sell it for Y and get to keep the difference. Once you establish this retail online it becomes known and can be difficult to adjust later. When you begin selling your product to retailers they will want to use your current online retail or lower as their go to market retail. Now you must take your retail and deduct 40-65% margin that the retailer will want, program costs they will want your company to pay and then finally your cost of goods. What is left over, at this point, can be to little to run a company and in some cases flat out in the negative. Because of the above it is important to establish your entire pricing structure right from the beginning. Below are some categories to consider when creating your pricing structure.

Big Box retail
Specialty retail
Club store retail
E-tailers
Department store retail
Your website

11. Getting ready – To recap, below is a list of the items you will need to create the cost structure you will quote to the retailers you are wanting to carry your product. Have fun and good luck.

MSRP – You must have an idea of what your product will retail for (see MSRP noted earlier in this article).
Margin – If you don’t yet know what margin your target retailers are looking for you can obtain help with one of our pricing worksheets noted below.
Program costs – If you don’t yet know these numbers see how to obtain our pricing worksheets at the bottom of this article.
Raw landed product cost – We can’t help you here. In order to finish your pricing you will need to have this number.
Rep or broker commissions – If you will be using a rep or broker and have negotiated their commission rate you will need to have this number handy.
Units sold – This section is where you will estimate your units sold to this retailer for a 12 month period. Creating this number will also help you with your volume projections and production planning.

For easy to use retail pricing templates visit http://www.tlbconsulting.com/Do-It-Yourself.html

For any other questions or information on how to get your products into Costco and other Big Box retailers visit http://www.tlbconsulting.com

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