What is an advantage of an independent, single-store over other forms of retail ownership?
In my whole retailing career, I have stuck to one guiding principle: give your customers what they want…and customers want everything: a wide assortment of good quality merchandise, lowest possible prices, guaranteed satisfaction with what they buy, friendly knowledgeable service, convenient hours, free parking, and a pleasant shopping experience. Show
You love it when you visit a store that somehow exceeds your expectations and you hate it when a store inconveniences you, or gives you hard time, or just pretends you are invisible… − Sam Walton (Founder, Walmart) In the complex world of today, the consumer is king and retailers are keener on consumer satisfaction. Considering the busy lifestyles of today’s consumers, the retailers also provide services apart from products. Retailing occupies a very important place in the economics of any country. It is the final stage of distribution of product or service. It not only contributes to country’s GDP but also empowers a large number of people by providing employment. Retail Management starts with understanding the term 'Retail'. What is Retail?
Any organization that sells the products for consumption to the customers for their personal, family, or household use is in the occupation of retailing. Functions of a RetailorRetailor provides the goods that customer needs, in a desired form, at a required time and place.
Retail in Marketing ChannelsWith industrialization and globalization, the distance between the manufacturer and the consumer has increased. Many times a product is manufactured in one country and sold in another. The levels of intermediaries involved in the marketing channel depends upon the level of service the consumer desires. Type A and B − Retailers. For example, Pantaloons, Walmart. Type C − Service Providers. For example, Eureka Forbes. Classification of Retailing FormatsThe retailing formats can be classified into following types as shown in the diagram − Ownership Based RetailingLet us see these retailers in detail −
Merchandise Based RetailingLet us see these in detail −
Non-Store Based (Direct) RetailingIt is the form of retailing where the retailer is in direct contact with the consumer at the workplace or at home. The consumer becomes aware of the product via email or phone call from the retailer, or through an ad on the television, or Internet. The seller hosts a party for interacting with people. Then introduces and demonstrates the products, their utility, and benefits. Buying and selling happens at the same place. The consumer itself is a distributor. For example, Amway and Herbalife multi-level marketing. Non-Store based retailing includes non-personal contact based retailing such as −
The success of non-store based retailing hugely lies in timely delivery of appropriate product. Service Based RetailingThese retailers provide various services to the end consumer. The services include banking, car rentals, electricity, and cooking gas container delivery. The success of service based retailer lies in service quality, customization, differentiation and timeliness of service, technological upgradation, and consumer-oriented pricing. Product Retailing versus Service RetailingProduct RetailingService RetailingQuality and cost are prime factors in the success of product retailing.Timeliness and nature of people involved in service retailing are crucial factors in the success.Product retailer and consumer relationship is established only if the consumer frequently visits the outlet.Service provider and customer relationship is established right from start.Products can be stored in outlet while retailing.Services are intangible hence cannot be stored while retailing.Product retailing can be standardized.Service retailing cannot be standardized as it highly depends upon the human entities involved.In product retailing, the ownership of the purchased product can be transferred from owner to consumer after transaction.In service retailing, there is no transfer of ownership. The consumer can only access the service.Retail versus WholesaleRetailWholesaleThe products are sold to the customers directlyThe products are sold either to retailer for further selling or to the customer directlyRetailer sells the products by adding his own profit margin hence the cost of product increasesThe cost of product sold at wholesale is always lesser than retail costRetail business generally does not have direct contact with the manufacturerWholesale business has a direct contact with the manufacturerRetail business buys products from wholesaler in small quantities. Hence, there is always an upper hand to question the quality and discard the damaged productsWholesale businesses have to buy from the manufacturer in bulk. Hence if there is some issue with the quality of the product, they can hardly complainRetail has to work on attracting customers, managing selling space, employee’s salaries, etc.Wholesale business is not much engaged into such activitiesRetail business earns lesser profitWholesale business earns more profitRetail TerminologyHere are some commonly used terms in Retail Management − ConsumerismThe organized-efforts by individuals, groups, and governments to protect consumers from policies and practices that infringe consumer rights.ConsumptionUsing a product or a service for one’s benefit in particular time; not for resale.Customer SatisfactionIt is the degree at which the customer is pleased after purchasing and using a product or availing a service, and going to the same retailer or service provider.DistributionIt is movement of products or services from manufacturer to end consumer through a channel.Empowered ConsumersThe consumers with access and knowledge of Internet, exploiting the power of digital technologies, and demanding products and services matching their personal preferences.Inventory ShrinkageReduction of inventory due to theft by employees, customers, or by error from merchandise management at the time of receiving merchandise.LogisticsIt is planning, executing and controlling of the procurement and movement of material and resources on some beneficial purpose.MarkdownReduction in price.PlanogramPredetermined layout of display to promote merchandise sale.ProcurementIt is the process of buying a product or a service. It involves various stages such as planning, researching supplier or service provider, negotiating price, placing order, making payment and availing the product or service.RetailSale of products or services to end customer for consumption rather than resale.Supply-Chain ManagementIt is the management of material and information flow in a chain from manufacturer to consumer for providing highest level of customer satisfaction at lowest possible price.Switching CostsThe costs incurred by a consumer for switching from one supplier or marketplace to another.WholesaleThe business of selling products of large quantity at lesser price to retailers or consumers.Evolution of RetailThough the barter system is considered as the oldest form of retailing, the traditional forms of retailing such as neighborhood stores, main-street stores and fairs still exist in the laid-back towns around the world. During post-war years in the US and Europe, small retailers reformed their shops into large organized stores, markets, and malls. What are the advantages of independent stores?Independent retailers have more control over every aspect of their stores than a corporate retailer ever could. And because of that, there are fewer approvals and concessions needed when bringing on new products and vendors.
What is an independent retail store?Independent retailers are businesses that are privately owned. They are usually thought of as single-store operations, and they can offer both high risk and high rewards.
What are the advantages of in store retailing?Advantages of having Retail business
Retail outlets provide a platform where a customer can see what they are buying as opposed to online stores. The customer gets instant satisfaction and the customer move off with their purchases immediately.
What is independent single store establishments?Independent, Single Store Establishments: These are generally located in localities where population is higher. They can be a specialized apparel store to MBO or a grocery store. Owned by a family or individual with operations limited lo the area where store is located with direct personal relationship with customers.
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