Internship Report on

“SPAR HYPERMARKET”
Submitted BY
VIGHNESH S
USN: 4SN20BA076
Submitted to
DEPARTMENT OF MBA,
SRINIVAS INSTITUTE TECHNOLOGY
In partial fulfilment of the requirements for the award of the degree of
MASTER OF BUSINESS ADMINISTRATION
Under the guidance of

INTERNAL GUIDE EXTERNAL GUIDE

DR. AJOY S JOSEPH MS. SNIGDHA RAJ
HOD MBA DEPARTMENT HR MANAGER
SRINIVAS INSTITUTE OF TECHNOLOGY , SPAR HYPERMARTKET,
MANGALORE FORUM FIZA MALL,
MANGALORE

DEPARTMENT OF MBA
SRINIVAS INSTITUTE OF TECHNOLOGY

Approved by AICTE, New Delhi and Govt of Karnataka

And Affiliated to Visvesvaraya Technological University, Belagavi

2021
Company Certificate
 SRINIVAS INSTITUTE OF TECHNOLOGY
Approved by AICTE, New Delhi and Govt of Karnataka
And Affiliated to Visvesvaraya Technological university, Belagavi

DEPARTMENT OF MBA
CERTIFICATE

This is to certify that Mr.VIGHNESH S bearing USN:4SN20BA076 is a bonafied student of

Master of Business Administration course of the Srinivas Institute of Technology 2020-
2021, Affiliate to Visvesvaraya Technological university, Belagavi.
Internship Study on “SPAR HYPERMARKET” prepared by him under the guidance of
Dr. AJOY S JOSEPH in partial fulfilment of the requirement for the award of the degree of
Master of Business Administration of Visvesvaraya Technological university, Belagavi,
Karnataka.

__________________ _________________ _____________________

Dr. Ajoy S Joseph Dr. Ajoy S Joseph Dr. Shrinivasa Mayya D
Internal Guide HOD Principal

Name of the student : VIGHNESH S

USN : 4SN20BA076
Viva :

Name of the Examiners:

1.
2.
 DECLARATION

I, VIGHNESH S, hereby declare that the Internship Study conducted at “SPAR

HYPERMARKET” is record of independent work carried out by me under the guidance of
Dr. AJOY S JOSEPH, HOD of MBA Department, Srinivas Institute of Technology.
I also declare that this Organization Study is towards the partial fulfilment of the university
regulations for the award of degree of Master of Business Administration by Visvesvaraya
Technological University, Belagavi.
I have undergone an organization study for a period of 4 weeks I further declare that this
Organization Study is based on the original study undertaken by me and has not been
submitted for the award of any other university or institute for the award of any other degree.

Place: Mangalore Signature of the Student

Date: VIGHNESH S
USN:4SN20BA076
 ACKNOWLEDGEMENT

I would like to take this opportunity to express my gratitude towards

those who have rendered their valuable guidance and have positively
influenced my knowledge during the course of organization study.

I would like to express my sincere gratitude to Dr.SHRINIVASA

MAYYA D, Principal, Srinivas Institute of Technology, Valachil,
Mangalore, for his guidance and support in carrying out this organization
study.

I thank to Dr. AJOY S JOSEPH, HOD, Department of MBA, Srinivas

Institute of Technology, Valachil, Mangalore for giving us support and
guidance for our organization Study.

It gives me immense pleasure to express my deep sense of gratitude To

Ms.SnigdhaRaj,The HR MANAGER of SPAR HYPERMARKET,
Mangalore and other Managing staff Of the company for giving me the
privilege to conduct my Organization study and Willingly rendering me
their hands in gathering necessary information.

Finally, I would like to thank my Parents, almighty, and all my dear friends
who have helped me in the completion of the report.

Place: Mangalore Vighnesh.S

Date : (4SN20BA076)
 TABLE OF CONTENTS

Chapter Particular Page No

1 INTRODUCTION ABOUT THE
ORAGANIZATION & INDUSTRY 1-6
1.1 Retail industry in India
1.2 Current trend in retail Industry
1.3 IT in retail industry
2 ORGANIZATION PROFILE 7 -20
2.1 History
2.2 Introduction
2.3 Vision, Mission, core values
2.4 Objectives
2.5 Business volume
2.6 Products profile
2.7 Competitors in India
2.8 Work flow module
2.9 Ownership pattern
2.10Future Growth and
Prospects
3 21-31
MCKINSEY’S 7S FRAME
WORK & PORTER’S FIVE
FORCE MODEL WITH SPECIAL
REFERENCE TO SPAR
HYPERMARKET
4 32-33
SWOT ANALYSIS
5 34-39
ANALYSIS OF FINANCIAL
STATEMENT
6 40
LEARNING EXPERIENCE

41
BIBLIOGRAPHY
 LIST OF TABLES

Table PARTICULAR PAGE NO.

NO.
1.1 FMCG market In India 6

1.2 Revenue from retail in 6

India
2.1 Ownership pattern 19

5.1 Condensed profit &loss 35

A/c
5.2 Balance sheet 36

LIST OF FIGURES

FIG TITLE PAGE

NO. NO.
1.1 Indian retail industry 2

1.2 IT In retail industry 4

2.1 Spar logo 9

2.2 Inventory process 17

3.1 Mckinsey’s 7S Framework 21

3.2 Structure 24

3.3 Porter’s Five Force Model 27

4.1 SWOT Analysis 32

 EXECUTIVE SUMMARY
The study is conducted on overall activities of the SPAR HYPERMARKET.
This report provides general information about the Retail sector and Spar
hypermarket. The study was conducted for the period of 4weeks. The main
objectives of this company is participate actively in the growth of all segments of
the economy, customer satisfaction, sales maximization, Service sector etc, with
a mission to achieve sustained growth of business and profitability and fulfilling
socio-economic obligations The data for the study is collected from the website
of the company and annual reports.
The report of the study prepared by dividing into six chapters:

Chapter one Industry Profile includes Indian Retail industry, current

trends in retail industry, information technology in retail industry.

Chapter two contains brief introduction about the organization profile, it

includes background, nature of business, vision & mission and quality
policy, workflow model, ownership pattern, product& service profile,
future growth.

Chapter three includes Mckinsey’s 7S framework and Porters Five

Force Model of Spar hypermarket.

Chapter four includes SWOT Analysis i.e. strength, weakness,

opportunities, threat of spar hypermarket.

Chapter five includes analysis of financial statements it consists Profit

&loss A/c, balance sheet & Ratio analysis.

Chapter six includes learning experience.

 CHAPTER- 1
INTRODUCTION ABOUT THE
ORGANIZATION & INDUSTRY

1.1 INTRODUCTION
The Indian retail industry has emerged as one of the most dynamic and fast-growing
industries due to the entry of several new players in the recent times along with rising income
levels, growing aspirations, favorable demographics and easy credit availability. It
constitutes over 10% of the country’s Gross Domestic Product (GDP) and around 8% of
the employment and is valued at USD 672 billion. Globally, India is fifth-largest global
destination in the retail space and is growing at a rate of 12% per annum. Over the last two
decades, the size, scope and complexity of retailing has undergone considerable change. The
retail industry can broadly be classified into two categories: Organized and Unorganized.
Thought the market has been dominated by unorganized players, the entry of domestic and
international organized players is set to change the scenario.

Organized Retail: Organized retail is characterized by high investment requirements, large

premises, trained staff where retailers are licensed and are registered to pay taxes to the
government.

Unorganized Retail: Unorganized retail refers to the traditional form of retail often situated
near residential areas. It is generally characterized by low rentals, low tax payouts with a
majority of it being owner managed and employing personal capital. It includes formidable
mix of conventional Kirana shops, general stores, mom-&-pop stores, paan-beedi shops and
other small retail outlets. Currently, organised retail market is valued at about USD 60
billion, only about 9% of the sector, where as unorganized retail market holds the rest. India's
organised retail penetration is much lower compared with other countries, such as the United
States which has organised retail sector penetration of 85%.

1
 Fig: 1.1(Indian retail industry)

• Indian retail one of the fastest growing markets in the world due to economic growth.
• India is the world’s fifth largest global destination in the retail space.
• Retail market in India is projected to grow from an estimated US$ 795 billion in 2017
to US$ 1,200 billion in 2021F.
• India’s retail sector investments doubled to reach Rs 1,300 crore (US$ 180.18
million) in 2018.
• The Indian retail industry is one of the fastest growing in the world. Retail industry
in India is expected to grow to US$ 1,200 billion by 2021 from US$ 672 billion in
2017
• India’s population is taking to online retail in a big way. Online retail sale is
forecasted to grow at the rate of 31 per cent to reach US$ 32.70 billion in 2018@.
• Revenue generated from online retail is projected to grow to US$ 60 billion by 2020.
• Organised retail penetration is expected to increase to 18 per cent in 2021 from an
estimated nine per cent in 2017.
• India is expected to become the world's third-largest consumer economy,
reaching US$ 400 billion in consumption by 2025

2
1.2 TRENDS IN INDIAN RETAIL SECTOR:
Department stores: Department stores are general merchandisers. They offer to the
customers mid- to high-quality products. Though they sell general goods, some department
stores sell only a select line of products. Examples in India would include stores like
"Westside" and "Lifestyle"--popular department stores.

Malls : One of the most popular and most visited retail formats in India is the mall. These
are the largest retail format in India. Malls provide everything that a person wants to buy, all
under one roof. From clothes and accessories to food or cinemas, malls provide all of this,
and more. Examples include Spencers Plaza in Chennai, India, or the Forum Mall in
Bangalore.

Supermarkets : One of the other popular retail formats in India is the supermarkets. A
supermarket is a grocery store that sells food and household goods. They are large, most
often self-service and offer a huge variety of products. People head to supermarkets when
they need to stock up on groceries and other items. They provide products for reasonable
prices, and of mid to high quality.

Street vendors : Street vendors, or hawkers who sell goods on the streets, are quite popular
in India. Through shouting out their wares, they draw the attention of customers. Street
vendors are found in almost every city in India, and the business capital of Mumbai has a
number of shopping areas comprised solely of street vendors. These hawkers sell not just
clothes and accessories, but also local food.

Hypermarkets : Similar to supermarkets, hypermarkets in India are a combination of

supermarket and department store. These are large retailers that provide all kinds of groceries
and general goods. Saravana Stores in Chennai, Big Bazaar and Reliance Fresh are
hypermarkets that draw enormous crowds.

3
1.3. Information Technology in Retail
I.T. in retail Over the years as the consumer demand increased and the retailers geared up
to meet this increase, technology evolved rapidly to support this growth. The hardware and
software tools that have now become almost essential for retailing can be divided into 3
broad categories

I.T. IN RETAIL

Customer Operation Strategic Decision

Interfacing Support Support Systems
Systems Systems

Fig: 1.2(Information Technology in Retail)

Customer Interfacing Systems

Bar Coding and Scanners: Point of sale systems use scanners and bar coding to identify
an item, use pre-stored data to calculate the cost and generate the total bill for a client. Tunnel
Scanning is a new concept where the consumer pushes the full shopping cart through an
electronic gate to the point of sale. In a matter of seconds, the items in the cart are hit with
laser beams and scanned. All that the consumer has to do is to pay for the goods.
Payments: Payment through credit cards has become quite widespread and this enables a
fast and easy payment process. Electronic cheque conversion, a recent development in this
area, processes a cheque electronically by transmitting transaction information to the retailer
and consumer's bank. Rather than manually process a cheque, the retailer voids it and hands
it back to the consumer along with a receipt, having digitally captured and storedand image
of the cheque, which makes the process very fast.
Internet: Internet is also rapidly evolving as a customer interface, removing the need of a
consumer physically visiting the store

4
Operation Support Systems

ERP System : Various ERP vendors have developed retail-specific systems which help in
integrating all the functions from warehousing to distribution, front and back office store
systems and merchandising. An integrated supply chain helps the retailer in maintaining his
stocks, getting his supplies on time, preventing stock-outs and thus reducing his costs, while
servicing the customer better.

CRM Systems : The rise of loyalty programs, mail order and the Internet has provided
retailers with real access to consumer data. Data warehousing & mining technologies offers
retailers the tools they need to make sense of their consumer data and apply it to business.
This, along with the various available CRM (Customer Relationship Management) Systems,
allows the retailers to study the purchase behavior of consumers in detail andgrow the
value of individual consumers to their businesses.

Advanced Planning and Scheduling Systems : APS systems can provide improved control
across the supply chain, all the way from raw material suppliers right through to theretail
shelf. These APS packages complement existing (but often limited) ERP packages. They
enable consolidation of activities such as long term budgeting, monthly forecasting, weekly
factory scheduling and daily distribution scheduling into one overall planning process using
a single set of data. Leading manufactures, distributors and retailers and considering APS
packages such as those from i2, Manugistics, Bann, Mercial incs and Sterling-Douglas.

Strategic Decision Support Systems

Store Site Location : Demographics and buying patterns of residents of an area can be used
to compare various possible sites for opening new stores.
Visual Merchandising : The decision on how to place & stack items in a store is no more
taken on the gut feel of the store manager.

5
1.4 EXECUTIVE SUMMARY OF INDIAN RETAIL MARKET
• Robust consumption, rural markets to augment FMCG market.
• FMCG market expected to increase to US$ 103.7 billion by 2020 from Rs 3.4 lakh
crore (US$ 52.75 billion) in FY2018.

Table 1.1: (FMCG Market in india)

• Increasing participation from foreign and private players to boost retail

infrastructure.
• India's online retail sector grows 23 per cent to US$ 17.8 billion in 2017.
• Online retail sales is forecasted to grow at the rate of 31 per cent year- on-year to
reach US$ 32.70 billion in 2018.
• Revenue generated from online retail is projected to grow to US$ 60 billion by
2020

Table 1. 2 : (Revenue from online retail in india)

6
 CHAPTER-2
ORAGANIZATION PROFILE-SPAR
HYPERMARKET

2.1 HISTORY OF COMPANY

The story of SPAR in the early years is the story of Adriaan van Well, an innovative Dutch wholesaler
with a clear vision for the future of SPAR. He was inspired by a simple yet powerful philosophy -
independent wholesalers and retailers can achieve more by working together than working alone. It
was van Well’s belief that only through collaborative work could the independent sector survive and
prosper in the face of increasing competition from multiple chains.

Spar was founded in 1932 in the South Holland town of Zegwaart .In 1953 an International Spar
office opened in Amsterdam to control and further develop the organization throughout Europe and
other continents. Many Spar shops are in Europe, but they can also be found in a number of
countries outside of Europe, such as Australia, Oman, Qatar, Emirates Malawi, Nigeria, South
Africa, Botswana, Namibia, Zimbabwe, Zambia, Mozambique, Seychelles, Sri Lanka, Cameroon,
China, India.
Spar opened in Vanuatu on 1 December 2009, ending Au Bon Marché's grocery monopoly. A Spar
shop may be owned independently, by a franchisee, or be part of a chain, depending on the model
applied in any given country. The owners of the parent company vary from country to country and
may include the shop owners themselves. The name and the current logo was most recently revised in
1968 by Raymond Loewy and has since remained unchanged.
In the United Kingdom Spar, founded in 1959, may be a supermarket or a convenience shop,
and is more common in Northern Ireland than Great Britain. In 1997, Spar was introduced to
most United Kingdom military bases by the Navy, Army and Air Force Institutes. where it sells
a variety of civilian and military products. In Ireland the Spar brand is known for
neighborhood shops and also the sub format Euro spar acting as mini-supermarkets. Since
1996, the company has been a major sponsor of the European Athletic Association and its
events.
The Dutch Spar is a member of Superunie, an inventory purchasing organization for a
number of otherwise unaffiliated supermarket brands.
In 1988 SPAR South Africa became a wholly owned subsidiary of Tiger Brands, a holding

7
company with a large diversified portfolio, however it was unbundled and listed as a
separate company in 2004. In July 2014 Spar Group South Africa opened its first
supermarket in Angola but no expansion of the brand is planned for this market. In August
2014 the group acquired 80% of the BWG Group, which had outlets in Ireland an southern
Britain.
In 2015 Ahold acquired all 35 hypermarkets and 14 supermarkets from Spar Czechia for
more than 5.2 billion Czech koruna. and converted them into Albert super- and
hypermarkets, however it had to divest itself of some shops in order not to have a
monopoly.
The first SPAR shop in Oman was inaugurated in January 2015 in Muscat.Spar Oman has
plans to open more shops over time as part of its expansion plans in Oman. Spar opened
its first store in Qatar in 2017, with the second store opening in 2018. A further two stores are
planned for 2018.
SPAR opened in Saudi Arabia in 2017, sub-licensed to Al-Sadhan Group opening the
first stores in Riyadh.
In 2017 Ceylon Biscuits Limited in Sri Lanka acquired a license to operate Spar brand in Sri Lanka
as Spar Lanka. This is a joint venture of Ceylon Biscuits Limited and SPAR Group Ltd South
Africa.They opened the first store in Thalawathugoda, Colombo. The plan is to open 50 outlets in
the country by 2023.

8
 2.2 Introduction
Retailing consists of those business activities involved in the sale of goods and services to
consumers for their personal, family, or household use. Retailing comprises of four
elements customer orientation, coordinated effort, value-driven, and goal orientation. The
word "Retail" originates from a French-Italian word. Retailer-someone who cuts off or
sheds a small piece from something. Retailing is the set of activities that markets products or
services to final consumers for their own personal or household use. It does this by organizing
their availability on a relatively large scale and supplying them to customers on a relatively
small scale. Retailer is a Person or Agent or Agency or Company or Organization who is
instrumental in reaching the Goods or Merchandise or Services to the End User or Ultimate
Consumer.

Fig :2.1 (spar hypermarket logo)

SPAR is the world’s largest independent food retail chain which operates on the
principle of a ‘Co - operative of Independent Retailers and Wholesalers’ and is present
in 48 countries with 13,112 stores and meets the needs of over 13.5 million consumers
every day.
SPAR Hypermarkets in India is the result of a license agreement between Dubai based
Landmark Group’s Max Hypermarket India Pvt. Ltd. and SPAR International. Max
Hypermarket has a total of 25 stores pan India and has stores currently in Bangalore,
Chennai, Coimbatore, Hyderabad, Ghaziabad, Gurgaon, Hyderabad, Mangalore and
New Delhi

9
SPAR offers the freshest quality, widest choice, great value for money and
personalized, friendly service all packaged to create a truly enjoyable shopping
experience.

SPAR Hypermarkets - Live Better. Spend Less.(Tag line)

SPAR is the world's largest food store chain with over 12000 stores in 38 countries across
4 continents and meets the needs of over 10 million consumers every day. SPAR
Hypermarkets and supermarkets in India is the result of a license agreement between
the Dubai based Landmark Group's Max Hypermarkets India Pvt. Ltd. and SPAR
International. SPAR is the world's largest independent food retail chain
which operates on the principle of a 'Co - operative of Independent Retailers and
Wholesalers.

Customers have the option to choose from a wide variety of quality products in every
category ranging from grocery, fruits and vegetables, bakery, dairy, meat, poultry and fish,
wine, beer and spirits, home textiles, personal care, crockery utensils, plastics and kitchen
appliances, electronics and IT accessories and much more. SPAR promises to elevate
shopping from a daily chore to a world class shopping experience that also offers value for
money. SPAR's retail philosophy is to provide freshness, choice, value and service to its
customers

SPAR promises to elevate shopping from a daily chore to a world class shopping experience
that also offers value for money. SPAR offers the freshest quality, widest choice, great value
for money and personalized, friendly service all packaged to create a truly enjoyable
shopping experience. SPAR's tag line "Live Better. Spend Less" epitomizesthis philosophy

SPAR assures excellent value for money throughout the year. The stores have a "Everything
Below MRP" concept. This simply means that SPAR offers the customer prices which are a
minimum of 4% and more below the actual MRP of the products.

10
The customer therefore is able to save a substantial amount on his groceries and regular
monthly shopping. SPAR also has Best Deals that run every fortnight and offer the customer
the best bargains. In conjunction with the Landmark Group's corporate loyalty programme,
SPAR launched The Inner Circle, a loyalty program for its customers in March 2009 which
offers shopping and saving benefits in all stores across the group.

In addition to freshness, choice and value, SPAR also assures world class service. Wide aisles
for easy and seamless trolley movement, from entrance to the parking area, fast billing
process at the numerous billing tills and even small details like the token system at the fish
counter where consumers get freshly cut and cleaned fish, packaged in ice.

Max Hypermarket India Pvt. Ltd. currently operates 25 stores in 9 locations. These cities are
Bangalore, Mangalore, Coimbatore, Hyderabad, Delhi, Ghaziabad, Gurgaon, Chennai and
Pune. The average hypermarket size is 50,000 sft. The company will be opening on an
average 5 stores a year over the next few years.

Landmark Group – Key Facts

• An International , diversified, retail conglomerate

• Founded in 1973 in Bahrain

• The Group operates over 2400 stores

• Retail presence of over 30 million sq. ft. across Middle East, India, Egypt, Turkey,
Yemen, Jordan, Sudan, Lebanon, Libya, Kenya & Pakistan

• More than 55,000 employees Globally

11
 One of the group companies, Max Hypermarket India Pvt Ltd operates Spar

Hypermarkets in India.

The Group has a presence across the retail categories of:

1. Fashion, clothing and garments

2. Kids wear ,toys and baby needs

3. Home furniture and furnishings

4. Electronics

5. Cosmetics

6. Accessories and footwear

7. Hospitality & Health

8. Food & Grocery.

2.3 VISION, MISSION

Vision

To be the most exciting, innovative and sought-after retail brand worldwide.

Mission

Our mission is to ensure that SPAR remains the world’s leading food voluntary retail chain.
We continue to grow our brand, our presence and our partners by enhancing the
competitiveness, productivity and profitability of our retail and wholesale partners
worldwide.
Core Values

• Passion for excellence

• Integrity in everything we do
• Empowering people to strive and deliver
• Adapting to changing market and consumer needs

12
 2.4 OBJECTIVES OF THE ORGANIZATION:
• The central objective business for earlier businesses of Spar hypermarket was to
bring in stability and consolidation.
• The dominant theme for business of Spar hypermarket is speed and imagination.
• Design management is helping to position the customer at the center of every
decision.

OBJECTIVES OF STUDYING THE ORGANIZATION:

• To identify the people who are the customers of Spar hypermarket .
• To identify the customer satisfaction level among the customers related to the
product supplied by the Spar hypermarket .
• To know about the expectations of the customers regarding any improvements in a
particular area in Spar hypermarket .
• To study, access and analyze the overall behavioral pattern of the customers of Spar
hypermarket .
• To identify the consumers buying behavior at Spar hypermarket

2.5 BUSINESS VOLUME

AREA OF OPERATION
Max Hypermarket India Pvt. Ltd. currently operates 25 stores in 9 locations. These cities are
Bangalore, Mangalore, Coimbatore. The average hypermarket size is 50,000 sft. The
company will be opening on an average 5 stores a year over the next few years.

ABOUT THE SPAR HYPERMARKET:.

✓ Total Number of Outlets – 12000

✓ Number of countries covered – 40
✓ Retail space under use 50,000 square feet
✓ Employee Strength – 3,50,000

13
2.6 PRODUCT PROFILE

• Food court
• Fruits & Vegetables
• Bakery Items
• Stainless Steel Utensils
• Plastics
• Crockery
• Cosmetics
• Herbal
• Confectionery
• Non-Food Dept

DEPARTMENT

• General Books
• Children Stationary
• Office Stationery
• Games

NBD (NEW BUSINESS DEVELOPMENT)

• Gift items
• Car & Motor Cycle Covers
• Helmets
• Scents & Perfumes
• Home Decor
• Auto accessories

TOYS AND SPORTS DEPT

• Soft Toys
• Hard Toys

14
 HOME LINE

• Bed Sheets, Pillows, Bed Spreads

• Towels, Yellow dust
• Carpets, Cushion Covers
• Chair Bags

CLOTHES DEPT
• Ladies sarees
• Girls Dress Materials
• Kids Wear
• Men’s Formals & Casuals Wears
• Men’s Accessories
• Luggage
• Home Appliances

2.7 COMPETITOR’S IN INDIA

Reliance Fresh is the convenience store format which forms a part of Reliance Retail Ltd
(RRL) of its parent company, Reliance Industries Ltd (RIL). RRL was set up in the year 2006 to
lead Reliance Group's foray into organized retail. Presently, it has grown into an organization that
caters to millions of customers, thousands of farmers and vendor’s.

15
Spencer’s Retail has been part of the Indian retail landscape since 1863 and was originally
set up by Mr John William Spencer. It acquired Indian ownership in the 1960s, and became
part of the RPG Group in 1989. Since inception, Spencer’s has been a consumer-centric
brand, constantly innovating, pioneering formats, evolving over time.

Fabindia is India's largest private platform for products that are made from traditional
techniques, skills and hand-based processes. It started as a wholesale export company and
has since successfully established itself as a major retail player in the Indian market.
Fabindia's first retail store opened in New Delhi in 1976. Today, Fabindia has 17.

The company’s leading formats include Pantaloons, a chain of fashion outlets, Spar
hypermarket , a uniquely Indian hypermarket chain, Food Bazaar, a supermarket chain,
blends the look, touch and feel of Indian bazaars with aspects of modern retail like
choice, convenience and quality and Central, a chain of seamless destination mall.

16
2.8 WORK FLOW MODEL

Fig 2.2(INVENTORY PROCESS)

RECEIVING To get the desired amount of quantity from vendors

HANDLING To safekeeping the stock and product it from any wear and tear

PLACING To putting the stock on to the shelf in most customer friendly way

SELLING
Providing best customer service in terms of instant availability of products

INVENTORY MANAGEMENT

Inventory - Goods and Materials that are available in stock by a business

Inventory Management-The process to maintain optimum inventory to be able to meet
business requirements and avoid over or under inventory that can impact the financial figures

17
PURPOSE OF INVENTORY MANAGEMENT SPAR

❖ How many units to be order

❖ When to order
❖ Keeping a sufficient amount of units so that company don't suffer from loss
of business
❖ To provide better customer service by providing them what they want at the time of
demand
❖ Reducing operational cost by keeping optimal quantity of stocks

MAIN TASKS OF INVENTORY MANAGEMENT TEAM SPAR

❖ Daily Dump Report preparation - It is the report which shows the daily waste
happened in F&V Nonveg, and Bakery department

❖ Internal transfer report preparation and Internal transfer checking - This is a report
that includes transfer of products between one department to another within the store
❖ Daily Price change report preparation
❖ A,B,C count Checking of the stock
❖ Checking the FIFO compliances
❖ Checking the PI(Point of Inventory)
❖ Stock Voucher creation. This contains the actual stock quantity present in the
physical form
❖ 90 days stock correction
❖ Moving and non-moving stock check

18
2.9 OWNERSHIP PATTERN

Table 2.1(showing Spar international ownership pattern)

2.10 FUTURE GROWTH & PROSPECTS

SPAR, the world’s largest voluntary food retail chain, has announced plans for significant growth in
India which will see 25 SPAR Hypermarket stores and an anticipated increase in its current
workforce of 2,500 across the country to 3,300 by the end of 2017. The announcement was made
during the visit of the Dutch Prime Minister, Mark Rutte, along with a high-level Dutch Trade
delegation, to a SPAR Hypermarket in New Delhi. Together with the Prime Minister, the Dutch
delegation included Minister for Agriculture, Sharon Dijksma and Dutch Ambassador to India,
Nepal & Bhutan, Alphonsus Stoelinga.

SPAR re-entered the Indian market last August following the signing of a partnership agreement
with Max Hypermarkets.

19
The partnership has already successfully re-launched 16 SPAR Hypermarkets with an additional
four openings planned for the remainder of 2015, all offering an extensive range of food and non-
food, at competitive prices. It is anticipated that SPAR India will reach €400million turnover by
2020

SPAR International Managing Director, Dr. Gordon Campbell said, “Our growth and success in India
provides an ideal case study for the suitability of the SPAR model in emerging markets. Where other
global brands have struggled to gain traction, SPAR’s brand values and offering, global expertise and
partnership model, have brought immediate benefits for retailer, supplier and, ultimately, the
consumer.”

Mr. Vinay Singh, Managing Director of SPAR India, said, “We are delighted with the results since we
converted our first 16 hypermarkets to the SPAR brand. SPAR’s understanding of international best
practice in retail operations and supply chain management, combined with our consumer
understanding and local sourcing strengths have created an immediate uplift in store sales. The SPAR
brand propositions of freshness and value have been very well received by the Indian consumer.”

20
 CHAPTER- 3

MCKINSEY'S 7S FRAMEWORK & PORTER’S FIVE

FORCE MODEL WITH SPECIAL REFERENCE TO SPAR
HYPERMARKET

Fig 3.1 (showing MCKINSEY’S 7S FRAMEWORK)

1.Strategy

SPAR creates value on a global scale through our voluntary trading model and convenient delivery
of fresh food and groceries where people live. The group creates significant value for our
independent retailers, who benefit from the economies of scale, efficiency and a wide scope of
products offered and distributed through our distribution centers.

We recognize that the sustainability of our business model relies on balancing pricing at two points
between wholesaler and retailer, and between retailer and customer. If we get this right, retailers have a
compelling offering to consumers and cultivate the perception of SPAR as a value and quality choice.

21
2. Skills

SPAR has defined tasks and job roles and hires and trains employees for skill levels accordingly
with respect to those. The company ensures that all its job requirements are met and that employees
have the sufficient skills to perform their respective jobs in accordance with the values and culture as
well as the business goals and strategy of SPAR.

The human resource is one of the core competitive advantages of the company. The skills of
employees are developed specifically for job roles and requirements at SPAR and provide a
competitive benefit to the company – where players cannot imitate employee skills or training. This
creates a unique and non-substitutable competency for SPAR.

3.Staff
SPAR has a sufficient number of employees employed across its global operations. Employees for
different job roles and positions are hired internally as well as externally – depending on the urgency
and the skill levels required. Based on this, it is seen that SPAR has employees who are skilled as
per the requirements of their job roles and positions. All employees are given in house training to
familiarize themselves with the company and its values. External training along with in-house
training is provided for skill level enhancement.

SPAR has employed a large number of employees. The number of employees varies from country to
country as per the requirements and needs of the business and operations. The global team of SPAR
is an inclusive one that accepts, and encourages diversity, and works in synchronization with
members to ensure attainment of business goals. The team members and employees are the most
important part of business success for SPAR

22
4.Style
SPAR has a participative leadership style. Through a participative leadership style, SPAR is able
to engage and involve its employees in decision-making processes and managerial decisions. This
also allows the leadership to regularly interact with the employees and different managerial
groups to identify any potential conflicts for resolution, as well as for feedback regarding
strategic tactics and operations. Through its participative leadership, SPAR is able to enhance
employee motivation, and increase organizational commitment and ownership amongst
employees as well as other stakeholders.

5.System
SPAR has defined and well-demarcated systems in place to ensure that the business
operations are managed effectively and that there are no conflicts or disputes. SPAR
continually evaluates its systems through the designed controls. This monitoring of the performance
is continual and ongoing. This is largely done through observation and informal discussions.
Feedback to employees and overall department heads is informally given regularly as and when is
required. Formal evaluation of performance is also conducted semiannually – or quarterly,
depending on the need and the urgency of the projects and assigned tasks. This is a formal process
that is undertaken by supervisors and managers to ensure the identification of performance lags, and
suggestive means of improvement.

6.Shared Values
The core values at SPAR are defined and communicated to foster a creative and supportive
organizational structure that will allow employees to perform optimally, and enhance their
motivation and organizational commitment. The core values at SPAR include, but are not
limited to:
- Creativity

- Honesty

- Transparency

- Accountability

- Trust

23
- Quality

- Heritage

SPAR ensures that all its job tasks and roles are aligned with the core values that the
company propagates. This means that all activities, tactics, and strategic tactics employed
by SPAR will reflect its core values, and will not deviate away from these. This is to ensure
a consistent, and reliable brand image, as well as an honest organizational culture. In the
event of organizational change, the company will continue to ensure that all change
management processes and methods incorporate the core values so that the organizational
culture is consistently maintained, and systematically changed if need be.

7. Structure

Fig 3.2 (showing Structure of spar hypermarket)

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DUTIES OF DEPARTMENT HEAD

Department Heads are in charge of an academic department. They oversee the

implementation of strategic polices and work towards the advancement of that unit. They
continually assess the performance of the department and its members and contribute to the
modification of educational plans. They also manage the department budgets and
expenditures. They work towards effective dispersion of funds and prioritization of projects.
Some Department Heads may even continue their teaching duties, working with students and
preparing lessons. They receive good remuneration and work normal office hours. A
Department Head usually performs many of the following tasks:
a. Setting budgets

b. Translating strategic goals

c. Proposing departmental changes

d. Managing staff

e. Conducting research

f. Adhering to statutory compliance

g. Managing resources

h. Attending and hosting meetings

RESPONSIBILITIES OF DEPARTMENT HEAD:

• Provide direction to Managers in planning and executing assigned projects.

• Work with Managers to support new business development opportunities.

• Develop best practices to achieve department goals.

• Ensure that all staffs follow department policies and procedures.

• Analyze any department related issues and provide immediate resolutions.

• Organize trainings to improve technical skills of department staffs.

• Assist in employee recruitment, performance evaluation, promotion, retention an

25
 termination activities.
• Schedule regular client and department meetings.

• Build productive and long-term relationships with customers.

• Maintain existing customer base and identify and develop new customers

• Ensure service levels meet or exceed customer expectations.

• Address employee grievances and build positive working environment for

employees.
• Develop department budgets and establish cost-reduction initiatives.

DIRECTOR’S RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 134(5) of the Act, the Board of Directors of the
Company hereby confirms that:
• In the preparation of the annual accounts for the financial year ended March 31, 2018,
the applicable accounting standards have been followed along with proper
explanation relating to material departures.
• The Directors have selected such accounting policies and applied them consistently
and made judgments and estimates that are reasonable and prudent so as to give a true
and fair view of the state of affairs of the Company at the end of the financial year
and of the profit of the Company for the year ended March 31, 2018.
• The Directors have taken proper and sufficient care for the maintenance of adequate
accounting records in accordance with the provisions of the Act for safeguarding the
assets of the Company and for preventing and detecting fraud and other irregularities.
• The Directors have prepared the annual accounts for the financial year ended March
31, 2018 on a going concern basis.
• The Directors further state that they have laid down internal financial controls to be
followed by the Company and that such internal financial controls are adequate and
were operating effectively.

26
 3.2MICHAEL PORTER’S FIVE FORCES FRAMEWORK

Five Forces that Shape Strategy", Michael Porter observed five forces that have significant impact
on a firm's profitability in its industry. These five forces analysis today in business world is also
known as -Porter Five Forces Analysis. The Porter Five (5) Forces are -

Fig 3.3(Michael porter’s five forces framework)

27
 Porter Five Forces is a holistic strategy framework that took strategic decision away from
just analyzing the present competition. Porter Five Forces focuses on - how SPAR Group,
Inc. can build a sustainable competitive advantage in Business Services industry. Managers
at SPAR Group, Inc. can not only use Porter Five Forces to develop a strategic position
with in Business Services industry but also can explore profitable opportunities in whole
Services sector.

SPAR Group, Inc. Porter Five (5) Forces Analysis for Services Industry

1. Threats of New Entrants

New entrants in Business Services brings innovation, new ways of doing things and put
pressure on SPAR Group, Inc. through lower pricing strategy, reducing costs, and providing
new value propositions to the customers. SPAR Group, Inc. has to manage all these
challenges and build effective barriers to safeguard its competitive edge.

How SPAR Group, Inc. can tackle the Threats of New Entrants

• By innovating new products and services. New products not only brings new
customers to the fold but also give old customer a reason to buy SPAR Group, Inc.
‘s products.
• By building economies of scale so that it can lower the fixed cost per unit.

• Building capacities and spending money on research and development. New entrants
are less likely to enter a dynamic industry where the established players such as
SPAR Group, Inc. keep defining the standards regularly. It significantly reduces the
window of extraordinary profits for the new firms thus discourage new players in
the industry.

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2. Bargaining Power of Suppliers

All most all the companies in the Business Services industry buy their raw material from
numerous suppliers. Suppliers in dominant position can decrease the margins SPAR Group,
Inc. can earn in the market. Powerful suppliers in Services sector use their negotiating power
to extract higher prices from the firms in Business Services field. The overall impactof higher
supplier bargaining power is that it lowers the overall profitability of Business Services.

How SPAR Group, Inc. can tackle Bargaining Power of the Suppliers

• By building efficient supply chain with multiple suppliers.

• By experimenting with product designs using different materials so that if the

prices go up of one raw material then company can shift to another.
• Developing dedicated suppliers whose business depends upon the firm. One of the
lessons SPAR Group, Inc. can learn from Wal-Mart and Nike is how these
companies developed third party manufacturers whose business solely depends on
them thus creating a scenario where these third party manufacturers have
significantly less bargaining power compare to Wal-Mart and Nike.

3. Bargaining Power of Buyers

Buyers are often a demanding lot. They want to buy the best offerings available by paying
the minimum price as possible. This put pressure on SPAR Group, Inc. profitability in the
long run. The smaller and more powerful the customer base is of SPAR Group, Inc. the
higher the bargaining power of the customers and higher their ability to seek increasing
discounts and offers.

29
How SPAR Group, Inc. can tackle the Bargaining Power of Buyers

• By building a large base of customers. This will be helpful in two ways. It will reduce
the bargaining power of the buyers plus it will provide an opportunity to thefirm to
streamline its sales and production process.
• By rapidly innovating new products. Customers often seek discounts and offerings
on established products so if SPAR Group, Inc. keep on coming up with new
products then it can limit the bargaining power of buyers.
• New products will also reduce the defection of existing customers of SPAR Group,
Inc. to its competitors.

4. Threats of Substitute Products or Services

When a new product or service meets a similar customer needs in different ways, industry
profitability suffers. For example services like Dropbox and Google Drive are substitute to
storage hardware drives. The threat of a substitute product or service is high if it offers a
value proposition that is uniquely different from present offerings of the industry.

How SPAR Group, Inc. can tackle the Treat of Substitute Products / Services

• By being service oriented rather than just product oriented.

• By understanding the core need of the customer rather than what the customer is
buying.
• By increasing the switching cost for the customers.

5. Rivalry among the Existing Competitors

If the rivalry among the existing players in an industry is intense then it will drive down
prices and decrease the overall profitability of the industry. SPAR Group, Inc. operates in a

30
 very competitive Business Services industry. This competition does take toll on the overall
long term profitability of the organization.

How SPAR Group, Inc. can tackle Intense Rivalry among the Existing
Competitors in Business Services industry

• By building a sustainable differentiation

• By building scale so that it can compete better

• Collaborating with competitors to increase the market size rather than just
competing for small market.

Implications of Porter Five Forces on SPAR Group, Inc.

By analyzing all the five competitive forces SPAR Group, Inc. strategists can gain a complete
picture of what impacts the profitability of the organization in Business Services industry.
They can identify game changing trends early on and can swiftly respond to exploit the
emerging opportunity. By understanding the Porter Five Forces in great detail SPAR Group,
Inc. 's managers can shape those forces in their favor.

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 CHAPTER-4
SWOT ANALYSIS

Fig 4.1 (SWOT Analysis)

STRENGTHS

➢ High brand-Equity in evolving retail markets.

➢ More store spaces.

➢ Point of purchase promotions to increase the purchase.

➢ Variety of stuff under single roof increasing customer time and available
choices.

➢ Low price & Advertisement.

➢ Customer service desk.

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WEAKNESSES

➢ Unable to meet store opening targets.

➢ Falling of revenue per square feet.

➢ Weak R&D.

➢ Unavailability of branded items

OPPORTUNITY

➢ International expansion

➢ Evolving consumer preference in recent years.

➢ Huge complexes offer shopping.

THREATS

➢ Competitors, Global big players planning to foray into the markets.

➢ Government policies are not well-defined in emerging markets like India.

➢ Unorganized retail market of India.

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 CHAPTER-5

ANALYSIS OF FINANCIAL
STATEMENT

5.1 FINANCE DEPARTMENT

Finance plays a very important role in the day-to-day lives of each individual or corporation.
The importance of finance management is such that no one can ignore it and so, here is an
attempt to make you aware about the importance of finance in an economy, and how good is
financial health of the economy important for your well-being.

The finance department in this company is of utmost importance as they are responsible for
financial planning ensuring that adequate funds are available for achieving the objectives of
the organization. Moreover, it is the finance department which makes sure that the prices are
controlled, besides looking after the cash flow and controlling profitability levels. One of the
most important jobs of the finance department of this company is to identify the necessary
financial information which should be revealed to managers so that they can make informed
decisions and judgments. The department is also responsible for making financial documents
and preparing the final accounts so that they can be presented in the annual general meetings
of this company.

Here all the activities will be done under the control of the finance manager. Mostly in every
organization the expenses will somewhat in an equal ratio. But in this Company 90%
expenses is for purchasing and the remaining 10% is for the other administrative expenses.
These accounts will be maintained by the finance department. Nearly five to seven
employees are working in this department to maintain the accounts.

34
5.1 Condensed Statement of Profit & loss A/c and other
comprehensive income
R million 2020 2019 2018
Revenue-sale of merchandise 124277 109477 101018
Operating profit 3443 2979 2779
Other non operating items (279) (28) (144)
Finance income 618 186 169
Finance cost (1023) (344) (193)
Finance cost including foreign (137)

exchange & losses

Share of loss/profit (63) (11) (10)
PBT 2696 2782 2464
Taxation (740) (618) (637)
PAT 1956 2164 1827
Remeasurement of retirement funds 164 (395) 131

of tax
Remeasurement of post retirement 15 (21)

maturity aid of tax

Gain/loss on cash flow hedge net of 3 1

tax
Exchange difference from 295 76 132

transaction of foreign operation

Total comprehensive income 2433 1843 2091

Table 5.1(profit & loss a/c)

35
5.2 Condensed Statement of Financial position
R million 2020 2019 2018

ASSETS

Property plant & Equipment 8725 7184 6052

Rights of use assets 6606
Finance lease receivable 4713
Goodwill & intangible assets 6983 5064 4752
Loan &investment 1120 1620 1454
Operating lease receivable 6 269 208
Differed taxation asset 223 75 14
Current asset 24324 19767 18166
Asset classified as held for sale 39 79 10
52739 34053 31256
TOTAL ASSET

EQUITY & LIABILITY

Capital & reserves 7890 7467 7110
Differed taxation liability 278 297 413
Post-employment benefit obligation 1270 1268 788
Financial liability 50 1521 2043
Long term borrowing 6896 5009 4531
Provisions 8 29
Other non-current financial liability 3 3
Operating lease payable 299 231
Finance lease payable 11200
Current liability 25155 18181 16108
TOTALLY EQUITY & LIABILITY 52739 34053 31256

Table 5.2(balance sheet)

36
5.3 Ratio Analysis

Current ratio
Current ratio = current asset / current liability
2020
24324 ÷ 25155 =0.966:1

2019

19767÷18181 = 1.087: 1

2018

18166÷16108 = 1.123 :1

Quick Ratio

Quick ratio =Quick asset / Quick liability

Quick asset =current asset – stock
Quick liability =current liability – bank overdraft

2020
QA=24324-5377=18947
QL=25155-1210=23945
Quick ratio=18947÷23945=0.79:1

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2019
QA=19767-4447=15320
QL=18181-1553=16628
Quick ratio = 15320÷16628=0.92:1

2018

QA=18166-3933=14233
QL=16108-9=16099
Quick ratio =14233÷16099=0.88:1

Gross profit ratio

(Gross profit ÷ net sales) ×100

2020
(14780÷124277) ×100 =11.89%

2019

(11660÷109477) ×100=10.65%

2018

(10793÷103007) ×100 = 10.48%

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Return on investment ratio

Net profit before interest & tax ÷ capital employed

2020
2696÷7890 =0.34:1

2019

2782÷7467=0.37:1

2018

2464 ÷ 7110 =0.35:11

Debt Equity ratio

Long term debt ÷ shareholders fund

2020
6896÷7890 = 0.87:1

2019

5009÷7467 = 0.67:1

2018

4531÷7110= 0.64:1

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 CHAPTER-6

LEARNINGS

Personal learning
• To be patient while listening to others (customer’s) complaints & suggestions

• To have the willingness to help the others (customer) whenever required.

• To be punctual focused & regular to whatever we do.

• To show empathy towards other.

Professional learning

• To Co-ordinate with the different organization members

• To finish work within deadlines

• To give suggestions to management

• To prepare reports with required tables, pie chart, charts etc.

• Learned company profile, product profile, service profile.

• Work flow model of company

• Future growth of company

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 BIBLIOGRAPHY

Websites

• Wikipedia

• www.sparindia.com

• www.sparindia.org.in

• www.sparinternational.com

Files

• Employees Satisfaction on Study on Spar Hypermarket

• Inventory Management of Spar Hypermarket

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