Introduction to Retailing

Retailing consist of business activities involved in selling of goods & services to consumer for their personal, family or nonbusiness use.
A retailer is a businessman who sells products and/or services to consumers for personal or family or non-business use.

The Four Ps of Marketing

Retailers Retailersare are part part of of the the distribution channel channel distribution Product

Distribution

Price

Promotion

Distribution Channel
PPT 1-4

Distribution Channel

Retailers are a Business Like Manufacturers

Accounting

Finance

Marketing

Operations

MIS

Human Resources

Reasons for studying Retailing

Retail functions in distribution

Characteristics of Retailing
It offers direct interaction with customers. It sales products/services in small quantities. Customer service plays vital role. Sales promotion is offered heavily at this point. Location and layout are critical factors.

Evolution of retailing in India

Roots of retailing can be traced in weekly bazars and melas. Traditional age saw the emergence of kirana stores. (Convience stores or mom and pop store) Government came up for rural retail. (Khadi & Village Industries Commision- KVIC) Economy opened in late 1980s .

And in late 1980s with the opening up of economy retailing in India experienced great change.

Retailing Functions
Identifying Customer Demands Management of Merchandise Convenience of timing Convenience of location.

Retailing principles
Clear definition of objectives Duties and responsibilities. Unity of command Supervision and control Monitoring human resources Responsibility and authority

Global Retailing Trends

Going internationalization Enhancing service offerings Expanding private brands Consolidation

Reasons for Retail growth

Emergence of nuclear family concept. Growing Indian young population Increased disposable income FDI in retail Low cost of operations E commerce

Decision Variables for Retailers

Customer Service

Store Design and Display

Retail
Strategy

Merchandise Assortment

Pricing

Location

Communication Mix

List of Retail Entrepreneurs on Forbes 400 Richest Americans

Walton Family (Wal-Mart) Fisher (The Gap) Wexner (Limited) Menard (Menards) Marcus, Blank (The Home Depot) Kellogg (Kohls) Schulze (Best Buy) Levine (Family Dollar) Gold (99Cent Only)

TYPES / BUSINESS MODELS IN RETAIL

CLASSIFICATION ON THE BASIS OF OWNERSHIP CLASSIFICATION ON THE BASIS OF THE MERCHANDISE OFFERED NON-STORE RETAILING (OTHER)

CLASSIFICATION ON THE BASIS OF OWNERSHIP

INDEPENDENT RETAILER CHAIN RETAILER FRANCHISE LEASED DEPARTMENTS CONSUMER CO-OPERATIVES

INDEPENDENT RETAILER

OWNERSHIP IS WITH INDIVIDUAL OR FAMILY GIVES EASE IN ENTRY AND EXIT FLEXIBILITY IN INDIAN RETAIL INDUSTRY MOST STORES BELONG TO THIS CATEGORY QUICK DECISION MAKING CAPITAL LIMITATIONS LIMITED BARGAINING POWER WITH SUPPLIER CANNOT GAIN ECONOMIES OF SCALE LIMITED USE OF TECHNOLOGY LACK ADVERTISEMENTS

CHAIN RETAILER
OPERATES MUPTIPLE OUTLETS UNDER COMMON OWNERSHIP ALL STORES HAVE SIMILARITY IN MERCHANDISE OFFERED BARGAINING POWER WITH SUPPLIER ECONOMIES OF SCALE SHARING OF FINANCE AND FACILITIES CENTRALIZED BUYING AND DECISION MAKING ADVERTISEMENTS FLEXIBILITY MAY BE LIMITED HIGH INVESTMENT COST DECISION MAKING TAKES TIME

FRANCHISE

A FRANCHISE IS A CONTRACTUAL AGREEMENT BETWEEN THE FRANCHISER AND FRANCHISEE, WHICH ALLOWS FRANCHISEE TO CONDUCT BUSINESS UNDER AN ESTABLISHED NAME AS PER A PARTICULAR BUSINESS FORMAT.

FRANCHISE

OWNERSHIP OF STORE IN SMALL INVESTMENT ADVANTAGE OF BRAND NAME STANDARD OPERATING PROCEDURE ECONOMIES OF SCALE SHARING OF PROFIT CONTRACTUAL INFORCEMENTS CANCELLATION MAY TAKE PLACE

LEASED DEPARTMENT
Concept of shop in shop A leased department or a counter is leased/ rented to an outside party Enlargement of market leased department operators pay for some expenses Investment cost can be reduced Inflexibility of working hours Goods/ services are limited

CONSUMER COOPERATIVES
Retail store owned by member consumers Limitations on growth opportunities Limited goods/ services are offered Main motive is co-operation not profit

CLASSIFICATION ON THE BASIS IF THE MERCHANDISE OFFERED

CONVENIENCE STORE SUPERMARKETS HYPERMARKETS SPECIALITY STORES DEPARTMENTAL STORES OFF PRICE RETAILERS FACTORY OUTLETS CATALOGUE SHOWROOMS

CONVENIENCE STORE
Small stores located in residential areas Offers limited, daily use goods/ services It gives time and location convenience

SUPERMARKETS
These are large, low cost, low margin, high volume, self service operations designed to meet the needs for food, grocery and other non food items. store with a selling area between 400 sq m to 2500 sq m and selling at least 70% foodstuff and everyday commodities. Gives comfort of shopping to customers. High investment cost

HYPERMARKETS
A retail store with a sales area of more than 2,500 sq m, with at least 35% selling space devoted to non grocery products. Combination of supermarket and department store. Large variety of products offered Discounted price Economies of scale One stop shop