Place (Marketing Channel)

The distribution system is concerned with the movement of goods from the point of production
to the point of consumption which involves a variety of functions. The main participants in the
distribufion systeh are:

(1) The manufacturers

(2) The intermediaries

(3) The facilitating agencies

(4) The consumers

Manufacturers produce the goods. This is the starting point in the distribution system. The
second category of participants i.e., intermediaries, are involved in direct negotiation between
buyers and sellers whether or not they take title to goods. These intermediaries locate the
manufacturers who produce various products, identify the needs of the consumers and
distribute the goods. In the process, they perform various functions like buying, selling,
assembling, standardization and grading, packing and packaging, risk bearing, etc. Facilitating
agencies are the independent business organisations other than intermediaries. These agencies
facilitate the smooth distribution of goods from producers, through intermediaries, to
consumers. The major facilitating agencies are banking institutions, insurance companies,
transportation agencies and warehousing companies. The fourth category of participants in the
distribution system i.e., consumers, are the final destination for goods in the distribution
system.

A Channel of distribution is mainly concerned with second participant i.e., the intermediaries.
The term 'Channel of Distribution' refers to the route taken by goods as they flow from the
producer to the consumer. This flow of goods may mean its physical distribution and/or the
transfer of title (ownership). Channels of distribution are mainly concerned with the transfer of
title to a product which may be effected directly or through a chain of intermediaries. You know
most producers do not sell goods directly to the consumers. They make use of a variety of
intermediaries known as middlemen. These middlemen who take title to goods or assist in
transferring the title to goods as they move from the producer to the consumer is called the
channel of distribution. Thus, the channel of distribution is a network of institutions that
perform a variety of interrelated and coordinated functions in the movement of goods from
producers to consumers.

Market Functionaries

The term refers to agents/agencies involved in effective discharging of all activities and
services called marketing functions (Fig.1.1) in the interest of the producer/ manufacturer, the
end user or consumer. They play a dominant role in the distribution of goods and also help
producers to regulate production. This situation of regulating production comes up when
there is scarcity or excess production. Functionaries have to guard against undue price
fluctuations and unethical trade practices. The marketing efficiency depends on how best a
functionary has discharged the functions that are expected of him.

Fig.: 1.1 Marketing Functionaries

The various functionaries and their functions in marketing are given below:

Functionaries Functions
Producers • Production as per consumer needs
• Quality Control
• Application of modern technology in production
• Collection of market intelligence
• Transportation to markets
• Identification of intermediaries
• Evolving pricing policy
• Introduce value addition and diversification
• Publicity for the product
• Supply to demand
• Revenue generation
Traders • Collection of products
• Quality Control
• Storage and Transportation
• Identification of potential customers
• Appointing suitable agencies
• Advertising
• Pricing
• Buying and selling
• Payment of taxes
Commission • Locating potential consumers
Agents • Linking traders and consumers
• Facilitating the sales
• Collection of market intelligence
• Assist for efficient marketing
• Collection of commission
Processors • Cleaning and Grading
• Storage and transportation
• Preparation of raw material for domestic market
 • Market intelligence
• Adoption of technologies for product development
• Production of value added products for export
• Revenue generation
Importers and • Import of raw material for reprocessing
Exporters • Import of finished products
• Export of finished products
• Earn foreign exchange
Facilitators • Financial Assistance
• Banking
• Marketing intelligence
• Advertising
• After sales services
• Market analysis
• Infrastructure development
• Market management
• Provide all other support system
Consumers • Collect market information
• Inspect the products available
• Check the quality of the product
• Compare the prices
• Make proper selection of product
• Buy the product
CHANNELS OF DISTRIBUTION

We can classify the distribution channels into two broad categories:

1) direct channels

2) indirect channels

1. Direct Channels

When the producers sell their goods directly to the consumers, it is called a direct channel. No
middleman is present between the producer and the consumer. For direct selling, the first option
involves supplying the product to the customer using your own salesmen and arranging your
own deliveries. The second option is using the medium of post office. You obtain orders from
your customers who respond by mail or telephone to your advertisements or to letters mailed
directly to their houses. YOU deliver your products to them through mail or through some other
canier. The next alternative is to establish your own retail stores. Bata Ltd., for example, has
established its own retail stores throughout the country. This practice has also been adopted on
a smaller scale by a number of textile mills which have their own retail shops like Calico Mills,
Rayrnonds, etc. DCM has franchised a number of retailers to sell their products to the
consumers. Direct channel is also called zero-level channel as there is no middleman in
between producer and consumer. The three major ways of direct selling are shown in Figure
1.2.

Fig. 1.2: Direct Channels of Distribution

2. Indirect Channels

In the case of other products it is not possible for the manufacturer to supply goods directly to
the consumers. So middlemen like wholesaler. rctailer and mercantile agents may be engaged
in the channel of distribution. When the middleman engaged in the distribution channel, it is
called indirect channel. As shown in figure 1.3.

Fig. 1.3: Indirect Channels of Distribution

Channel Levels

The producer and the final customer are the part of every channel. The number of intermediary
levels is used to designate the length of the channels.

A zero level channel (also called direct marketing channel) consists of manufacturer selling
directly to the final customer. The major examples are door-to door sales, home parties, mail
order, tele marketing, T.V. selling; internet selling and manufacture own stores. Avon sales
~pmsentatives sells cosmetics door- to - door. Tupperware representatives sells kitchenware
goods through home parties. A one level channel contains one selling intermediary, such as a
retailer.

A two level channel contains two intermediaries. In consumer mdrkets, these are typically a
wholesaler and a retailer.

A three level channel contain three intermediaries. In the meat packing industry wholesaler
sell to jobber who sell to small retailer. Longer marketing channels consisting of mom than
three levels can also be found. In Japan, food distribution may involve as many as six levels.
From the producer's point of view, obtaining information about end users and exercising control
become more difficult as the number of channel level increases. As shown in figure 1.4.
 Fig. 1.4: Marketing Channels for Consumers and Industrial Products

Channels for Consumer Products

These channels are used for consumer durable goods which are directly consumed by the
household. For example, TV, car, food items etc. Following levels of channel are used for this
purpose.

a) Producer -------consumer

The shortest, simplest distribution channel for consumer goods involves no middlemen. The
producer may sell door to door or by mail. For instance, Southwestern Company uses college
students to market its books on a door to door basis.

b) Producer----retailer-----consumer

Many large retailers buy directly from manufacturers and agricultural producers. To the
chagrin of various wholesaling middlemen, Wal-Mart has increased its direct dealings with
producers. Producer wholesaler-+ retailer --, consumer. If there is a traditional channel for
consumer goods, this is it. Small retailers and manufacturers find these channels the only
economically feasible choice.

c) Producer----agent ----bretailer ---consumer

Instead of using wholesalers, many producers prefer to use agent middlemen to reach the retail
market, especially large scale retailers. For example, Clorox uses agent middlemen (such as
Eisenhart &Associates, a food broker) to reach retailers (such as Dillon's and Schnucks, both
large grocery chains), which in turn sell Clorox's cleansing products to consumers.

d) Producer ----agent -----wholesaler ----- retailer-------consumer

To reach small retailers producers often use agent middlemen, who in turn call on wholesalers
that sell to large retail chains and/or small retail stores. Working as an agent on behalf of various
groceries -products manufacturer, Eisenhart & Associates sells to some wholesalers (such as
Super Value) that distributes a wide range of product to retailers (such as Dierberg's, a
supermarket chain at St. Louis area). In turn Die bergs offer its assortment of product to final
consumers.

Channels for Industrial Products

A variety of channels are available to reach organizations that incorporate the products into
their manufacturing process or use them in their operations. In the distribution of business
goods, the terms industrial distributor and merchant wholesaler are synonymous. The four
common channels for business goods are:

a) Producer---------user

The direct channel accounts for a greater dollur volume of business products than any other
distribution structure. Manufacturers of large installations, such as airplanes generator, and
heating plants usually sell directly to users.

b) Producer-------industrial distributor -----------user

Producers of operating supplies and small accessory equipment frequently use industrial
distributors to reach their markets. Manufacturers of building materials and air-conditioning
equipment are two examples of firms that make heavy use of industrial distributors.

c) Producer------agent ------user

Firms without their own sales department find this a desirable channel. Also a company that
wants to introduce a new product or enter a new market may prefer to use agents rather than
its own sales force.

d) Producer-------- agents -------industrial distributor -----user

This channel is similar to the preceding one. It is used when, for some reason, it is not feasible
to sell through agents directly to the business user. The unit sale may be too small for the direct
selling. Or decentralized inventory may be requ~red to supply users rapidly, in which case the
storage services of an industrial distributor may be required.

Functions of Channel of Distribution

The functions performed by the distribution channels may be grouped into three categories as
follows:

1) Transactional Functions

2) Logistical Functions

3) Facilitating Functions

1) Transactional Functions:

Functions necessary to a transaction of the goods are called transactional functions. Buying,
selling and risk bearing functions come under this category. Participants in the channel of
distribution undertake these three functions. Producers sell the gonds and intermediaries buy
them. Later intermediaries sell the goods and consumers buy them. Because of this buying and
selling by the channel participants, title to goods changes hands and goods flow from producer
tobnsumer. If there is no willingness for buying and selling, there would be no transaction.
When goods are bought, it involves risk also. For instance, an intermediary bought goods from
the producer with the intention of selling at a profit. But he may incur loss due to fall in price.
All the participants in the distribution channel assume such risk of loss.

2) Logistical Functions:

The functions involved in the physical exchange of goods are called logistical functions.
Distribution channel performs some functions like assembling, storage, grading and
transportation which are essential for physical exchange of goods.

Goods are assembled in sufficient quantity to constitute an efficient selling and shipping
quantity. Sometimes, it is alsa,necessary to assemble a variety of goods to provide an
assortment of items desired by buyers. Grading and packing of goods facilitate handling and
sale of goods promptly. Proper storage of goods prevents loss or damage as well as helps
regular supply of goods to consumers whenever they want. Transportation makes goods
available at places where buyers are located. In the channel of distribution all these functions
are performed so that goods may reach the market place at proper time and may be conveniently
sold to the ultimate consumers.
3) Facilitating Functions:

These functions facilitate both the transaction as well as physical exchange of goods. These
facilitating functions of the channel include post-purchase service and maintenance, financing,
market information, etc. Sellers provide necessary information to buyers in addition to after
sales services and financial assistance in the form of Sale on credit. Similarly, traders are often
guided by producers to help them in selling goods, while the traders also inform producers
about the customers' opinions about the products.

Thus, a channel af distribution performs a variety of functions such as buying, selling, risk
bearing, assembling, storage, grading, transportation, post-purchase service and maintenance,
financing, market information, etc. But the relative importance of storage is more important for
perishable goods and bulky material such as coal, petroleum products, iron, etc. In the case of
automobiles and sophisticated electronic goods like computers, after sales service is very
important.

WHOLESALERS

Simply stated, wholesalers are those who happen to be engaged in wholesaling or wholesale
trade. In a broad sense, any individual or business firm selling goods in relatively large
quantities to buyers other than the ultimate consumers may be called a wholesaler. Thus
manufacturers who sell their products directly to retailers may be regarded as wholesalers.
However, in a more specific sense the term wholesaler may be defined as a merchant
middleman engaged in buying and reselling of goods to retailers and other merchants, or to
industrial or commercial users. Wholesalers do not sell the products to ultimate consumers.
The wholesalers belong to the category of merchant middlemen who acquire title to the goods
they handle. Agents or brokers may also act as wholesale middlemen but they do not acquire
the title to goods. Wholesalers act as middlemen between producers or importers of goods on
the one hand, and retailers or industrial users on the other. The goods traded by wholesalers
may include agricultural commodities, forest products, minerals as well as manufactured
goods.
Classification

Wholesalers may deal in a large or limited variety of products, restrict their activities mainly
to wholesaling or perform various functions incidental to their trade, and may operate in small
or large geographical territories. Accordingly, wholesalers may be classified on three different
bases: (1) merchandise dealt with, (2) method of operation, and (3) coverage of geographical
area. Look at Figure 1.5 for classification of wholesalers.

Fig. 1.5: Tpes of Wholesalers

Merchandise Basis

On the basis of goods dealt with by the wholesalers, we may distinguish three types of
wholesalers:

i) General merchandise wholesalers- those who deal in two or more unrelated types of
products. For instance, a wholesaler may deal in a number of consumer durables like
electrical goods, sports goods, cosmetics, hosiery, etc.
ii) General-line wholesalers- those who carry a number of goods in the same product
line. For instance, a wholesaler may carry convenience goods of daily household
necessity like soaps, detergents, toothpaste, razor blade, etc., or may stock cereals and
provisions like wheat, rice, dal, etc.
iii) Single-line or speciality wholesalers- those who restrict their operation to a narrow
range of products or speeific products. Wholesalers dealing in a few varieties of textiles
(cloth), or carrying varieties of printing paper only may be called speciality wholesalers,
or single-line wholesalers.
 Method of Operation

On the basis of the method of operations, wholesalers may be divided into two categories:

i) Service Wholesalers- those who perform a variety of functions like advertising,

grading, branding, packaging, etc., on behalf of manufacturers and retailers.
ii) Limited Function Wholesalers- those who undertake to carry out a few limited
functions, like packaging or grading.

Territory covered

On the basis of the geagraphical coverage of dealings, wholesalers may be grouped into three
types:

i. Local Wholesalers- those who restrict their operation to a particular city or town and
supply products to retailers in that area.
ii. District Wholesalers- those who have dealings with retailers located in a district.
iii. Regional orNational Wholesalers- those who specialise in products having a national
market and are nationally advertised. They have dealings with retailers located in a region
or a country.

Functions

In the preceding section we have learnt that wholesalers perform limited functions or undertake
a variety of functions. Actually, the functions of a wholesaler depend upon the nature of the
products dealt with and the business policy of that particular wholesaler. Of course every
wholesaler must carry out the minimum functions of buying, storing and supplying one or more
products. Besides these primary activities, several other functions may also be performed by
wholesalers.

The wholesalers perform the following important functions of marketing:

1. Assembling: The wholesaler collects varieties of products from different manufacturers

and keeps them in stock for sale to the retailers at the time when they need them.
2. Dispersion: The products assembled and stocked by the wholesalers are supplied to the
retailers who may be widely scattered.
3. Warehousing: The goods purchased by the wholesalers from the manufacturers and
producers have to be stocked in warehouse pending their sale to the retailers. The
arrangement for such storage is the responsibility of the wholesaler.
4. Transportation: The wholesaler has to move the goods from the various factories to his
own warehouse and from there to the retail stores. He may do so either by employing his
own vans or by hiring public carriers.
5. Financing: The wholesaler in most cases provides goods on credit to the retailers.
6. Risk-assuming: The wholesaler assumes the risk arising out of the changes in prices and
demand as also loss due to spoilage fir destruction of goods in his warehouse.
7. Grading and Packaging: The wholesaler has to sort out different grades of products
according to quality and other considerations and pack the goods into smaller lots for
retailers.
8. Price fixation: The prices of goods which consumers have to pay depend upon the prices
fixed by wholesalers and charged from retailers. This is an important function performed
by wholesalers because a number of factors including prices of competing goods, effect of
prices on demand, etc., have to be taken into account.

RETAILERS

In simple words retailing refers to all transactions which involve sale of goods to the ultimate
consumers for personal consumption. If the buyer uses the goods for reselling purposes it will
not be treated as a retailing transaction. Any individual or business unit or shop primarily
engaged in retail selling is known as a retailer or retail store. In a general sense, even a
manufacturer or wholesaler may sometimes engage in sale of ,goods to the ultimate consumers.
But they are not called retailers as retailing is not the major activity of such a manufacturer or
wholesaler. Thus a retailer or retail store is one whose business consists primarily of sale of
goods to consumers for their own use, but not for resale in business. Retail business may
include other types of transactions also. It will be treated as a retailing business if more than
half of its total sales revenue is from retail trading.

A retailer is a middleman because retailing invoives ;rocwing goods from suppliers (generally
wholesalers) and selling them to consumers for the personal use. Retailers perform the very
important task of making goods available to consumers, which after all is the objective that
underlies the production of goods, Retailers thus form a vital link in the channel of distribution
of products.
Classification

Broadly speaking, we may divide the retailers into two categories asshown in figure 1.6.

Retailers

Fixed shop
Itinerent Retailers Retailers

large scale small scale

retailers retailers
Hawkers &
Peddlers

Stalls on Streets
Pavement Departmental stores
Traders Super-market
Multiple shops or chain stores
Speciality Shops
Mail order house
Market Traders Consumer co-operative stores
Hire purchase traders Discount General
houses Super bazars Merchandise
Automatic vending machines Shops

Fig.1.6: Types of Retailers

Itinerant Retailers

Retail traders who carry on business moving about from place to place to sell their goods are
known as itinerant retailer. They do not have any fixed place of business. They either move
from house to house with their goods, or change their place of business frequently according
to convenience .and sales prospects. Thus these itinerant retailers move about and try to reach
as nearer to the buyer as possible. There are three types of itinerant retailers who are explained
below:

1) Hawkers or Peddlers: These retailers move from door to door in (residential localities and
sell their wares which may consist of vegetables, fruits, utensils, toys, ice cream, snacks,
etc. They carry their articles in bags or trays hanging from shoulders, on bicycles or push
carts, small motor vans or horse-drawn.
2) Pavement Traders: Pavement traders are found in busy market areas, street crossings, in
front of railway stations and bus terminals. The goods traded by them include items like
hand bags, cut-pieces of cloth, readymade garments, footwear, household utensils, toys,
books and journals, pens and pencils, fruits, vegetables, etc. These traders sometimes put
up temporary sheds or make-shift platforms for display of goods. More often they spread
their wares on pavements at different places depending on the prospects of sale.
3) Market Traders: This type of itinerant retailers generally sell their goods in weekly
markets held in small towns or villages. They move from one market to another in the
neighbouring places on specific days fixed for the market.

Small-scale Retail Shops

Small-scale retail shops include those small shops dealing with miscellaneous products of
regular use, and shops selling particular products of different varieties. They hold small stocks
and do their business in fixed shops located in residential areas or market places. According to
the nature of goods sold, the small retail shops may be divided into three categories as follows:

I) Stalls on Streets: Small shops on the road side are very common in cities and towns.
These are set up as stalls in front of large stores or in residential areas selling a limited
variety of products of regular use like statiol- ry, grocery, toilet products, biscuits, etc.
The shops are located within easy reach of consumers' residence or nearby roads or
street-crossings, or bus stops. These retailers meet the needs of customers at convenient
locations. They supply goods of regular use for which customers are not prepared to go
to central markets.
II) General Merchandise Shops: These are small retail stores which deal in all types of
general consumer goods of regular use including provisions, bread, butter, stationery
and toiletry. paper and pencils, cigarettes, matches, etc. These shops are located in
thickly inhabited residential areas and busy markets. Consumers find it convenient to
buy all their requirements in one shop. Regular buyers are also offered home delivery
services and credit facility.
III) Speciality Shops: Small retail shops which deal in only one or two special types of
goods are known as speciality shops. The goods dealt with may be only electrical
fittings of different kinds, or medicines, or motor parts, or books and stationery, or bread
and confectionary items, or ready-made garments, or toys, etc. People often find it
 convenient to buy their requirements from these shops due to the availability of
different grades and sizes in the small product line.

Large-scale Retail Shops

Large-scale retail shops are so called because they deal in a large variety of goods, and have
large volume of business. The types of fixed shops in this category include the following:

I. Departmental Stores: A department store is a large-scale institution comprising a number

of departments; each department specialising in a separate line of products. All these
departments are under one roof and one unified control. Department stores offer the widest
possible choice of products. The consumer can find all what he needs in one store rather
than move around from shop to shop. These stores are located in central places in big cities
so that they are easily accessible to customers. Bigger department stores offer a great
number of amenities like restaurants, post and telegraph offices, recreation rooms and car
parking.

A department store indulges in decentralised buying and centralised selling. In fact,

department store is a medium of mass merchandising. Departmental stores grew up in
developed countries mainly to cater to the requirements of well-to-do people who required
articles of high quality and looked forward for comfortable shopping. But they have also
become popular in urban centres in many developing countries. In India too, we find a
number of department stores coming up in urban centres, specially in metropolitan cities.

II. Super-market: A Super-market is a large-scale retail store which offers for sale a wide
variety of consumer goods of regular use. The articles may include stationery, toiletry, dress
materials, ready-made garments, toys, grocery items, crockery, kitchen utensils, medicines,
as well as bread, butter, meat, eggs, fruits, vegetables, etc. The items are placed in separate
stalls in the same building, or kept on shelves or tables in a hall. The customers are to pick-
up the items they need and then pay for the articles at the cash counter. It works on a self-
service basis though one or two salesmen are there to help the customers.
III. Co-operative Stores: Consumers sometimes join together to form co-operative societies
to sell goods on retail basis. The basic purpose is to eliminate middlemen and obtain their
requirements at a lower price. The capital is subscribed by the members through the
purchase of shares of small denominations. Co-operative stores purchase their requirements
in bulk, from manufacturers or wholesalers. This enables the co- operative stores to sell
their products at somewhat lower prices than the ordinary retailers.
IV. Multiple Shops or Chain Stores: The multiple shop system denotes an organisation which
controls a number of stores under one common ownership and management. The various
stores are located in various cities and in various localities of bigger cities. Multiple shops
refer to a group of, retail stores dealing in similar types of goods. The basic idea behind the
establishment of the multiple shops is to approach th-e customer in his vicinity unlike
department stores which .seek to attract customers to a central location. Tnese shops could
be operated by manufacturers or by wholesalers with the basic objective of eliminating
retailers. Bata Shoes and Usha Sewing Machines are the-two examples of products for
which multiple shops have been opened by manufacturers in India. Some textile mills also
have some shops of their own in bigger cities. If wholesalers decide to operate multiple
shops, they indulge in centralised buying with decentralised selling.
V. Mail-order House: Retail trading which consists of receiving orders by mail and delivery
of goods by parcel post is known as mail-order business. The mail-order house IS thus a
retail trading organisation which uses the post office as its channel of distribution. Standard
consumer goods with trade marks or brand names are generally dealt with by mail-order
houses. This is because customers are to place orders without physically checking the items.
Bulky goods which cannot be delivered by post, and those for which delivery costs are
relatively higher, are not included in the items traded. Orders from customers may be
secured by advertising in newspapers or journals. Sometimes circular letters are issued by
mail to certain categories of customers. For this purpose, a mailing list may be prepared
from the telephone directory or from the list of members of a club, or traders' association.
The mailing list contains the names and addresses of persons likely to be interested in the
particular goods.
VI. Hire-purchase Trading: Hire-purchase trading consists of supplying durable goods for use
by customers who agree to pay the price by instalment at regular intervals. The buyer
acquires ownership of the goods only after the total price has been paid. In other words, in
hire-purchase trading, the buyer takes possession of the goods, but does not get the
ownership until the last instalment has been paid. The instalments are regarded as hire
charges.
VII. Discount Houses: Large scale retail establishments which offer discounts on the prices are
known as 'Discount Houses'. Durable goods like household appliances (cooking ovens,
electrical gadgets, etc.) camera, binoculars, etc., are generally available through discount
houses at a relatively lower price as compared with the price charged by other retail stores.
This is possible as the discount houses directly purchase from manufacturers and operate
 the business on a low margin of profits. They expect to cover expenses and make substantial
profits through large volume of sales.
VIII. Super-Bazars: These are large retail stores organised by co-operative societies which sell
a variety of products under a single roof. The goods traded by super- bazars include
consumer goods which are procured at wholesale rates from manufacturers or wholesalers.
The stores are operated either on the principle of self- service or with separate counters
served by salesmen. The difference between a super-bazar and super-market is that the
former is organised by co-operative society whereas the latter is generally established as a
private sector organisation. Similarly, the difference between a consumer co-operative store
and super-bazar is that a consumer co-operative store is usually run on small scale, while
the super-bazar may be a large-scale establishment.
IX. Automatic Vending Machines: Retail sale of articles with the help of coin- operated
automatic machines is known as automatic vending. Retailing on a large scale is possible
in this way by placing machines at convenient locations like bus terminals, railway stations,
airports, shopping centres, etc. This method of retail selling is very popular in western
cbuntries. Cigarettes, razor blades, postage stamps, milk, ice-cfeam, soft drinks, soup,
paper-back books, newspapers, etc., are sold in cities through vending machines.
Customers are required to insert necessary coins in a slot and press a button whereby the
article is released automatically. The coins are collected from the machine periodically, and
articles are put in as needed. Automatic vending facilitates buying of small items round the
clock. There is no necessity of salesmen's services. However, the stocking capacity of
machine is limited and there are risks of mechanical failures imtating the customers.
Moreover, paper currency may not be used and coins of exact value are required to operate
the machine. In India, automatic vending has been used for limited purpose like selling
postage stamps, flight insurance, milk, etc. It is not a popular retailing device in India due
to the existence of a large number of small retail shops.