Measuring Retail Productivity in Indian Context

Abstract

In this study, the focus is upon developing a constitutive and operational model of the construct 'Retail Productivity' from a store level application and usage point of view. Retailers over the years have developed and used various methods for their performance measurement as well as development of strategy. Obviously, retail productivity is one of them and probably rather significant too. However, lack of clarity at the conceptual level has made retail productivity a synonym for retail performance and hence retailers use sales per square feet, employee turnover or return on investment to explain retail productivity / store productivity. Ingene (1982) highlights twelve different productivity definitions and their overall measures. As there is complete lack of standardization of the retail productivity score, productivity scores of two different stores (organizations) become totally non-commensurable for any comparative purpose. As a result, a superior retail productivity score fails to develop any sustainable strategy for future and an inferior retail productivity score fails to pinpoint areas of concern. With this core thought process, in this study, it is intended to define retail productivity conceptually, identify exhaustively the various constituents and their measures, determine their significance and finally integrate them all with a model for measuring retail productivity at individual store level. Consequently, it should help identify some store level issues and help development of strategic input to address those issues.