As India attracts more FDI in retail and opens its doors to the multinational giants, organized retailing across various sectors is bound to grow in the coming decade. Although a retailer’s real litmus test is the “customer satisfaction level with in-store shopping experience”, the importance of efficient backend operations, in particular, inventory management, cannot be denied. This study uses in-depth case study and action research methodology to map the inventory management process from stock inwards to stock outwards, identifies the gaps in the inventory management and operations process adopted in three Delhi-based Tata Croma Stores, and offers suggestions accordingly. It is observed that in-store inventory storage and goods outwards process are the two key areas that require improvements across all sections of the stores. The focus of the senior management is more on improving front-end operations and maintaining high customer service levels. As a result, backend operations display sub-optimal efficiencies. One strong reason for non-compliance is ‘strategy deployment’ gap. This study fulfils the dual imperatives of action research. At practice level, it can help the managers to ensure the smooth flow and functioning of the inventory in the retail stores. At the same time, it provides insights into the challenges faced by the emergent organized retail in India. This is one of the early studies to conduct an audit of a consumer electronics retail company and highlight its backend inventory management and operations problems.

Organized retailing1 in FMCG, apparel, home furnishings and consumer electronics sectors is fast gathering momentum in India, although the majority of Indian retail industry still comprises traditional ‘mom and pop’ stores and haat, bazaars with primitive infrastructure and retailing facilities. This sector has grown from 2% to 8-10% in the last five years on the basis of Foreign Direct Investments (FDI) and enterprising domestic players. The A T Kearney’s (2011) Global Retail Development Index has ranked India as the fourth most attractive nation for retail investment among 30 emerging markets. With recent favorable government policies2 and expanding middle class with high disposable incomes, organized retailing is poised to grow further in the coming years and spread to tier-II and tier-III cities as well as rural markets.

In accordance with the general trend, consumer electronics industry has also shown double-digit growth in the last decade. With the emergence of stores such as Tata Croma, Videocon Next, Reliance Digital and E-Zone, there has been a dramatic change in the competitive landscape of this sector. Higher disposable incomes, increased product awareness, affordable prices, and shift in lifestyles have influenced the change in amount and pattern of consumer spending in this sector. This has led to the incumbent players’ investing heavily in establishing their presence across different states of the country.

Supply Chain Management Journal, Backend Processes, Operational Issues, A Quick Scan Audit, Inventory Management System, Tata Croma Stores, Foreign Direct Investments (FDI), Tata Croma, Videocon Next, Reliance Digital and E-Zone.