Retailing

Includes the business activities involved with the sale of goods and service to the final consumer for personal, family, or household use

Final step in the distribution channel

Types of retailers by ownership Independent Corporate (retail) chain Franchise Leased department

Independent store

Operates only one outlet Personal service Good location Close customer contact Attracts entrepreneurs

Corporate (retail) chain

Multiple outlets Centralized purchasing and decision making More complex organizations

Franchising

Contractual agreement between a franchisor and a retail franchisee

Franchisee runs a certain form of business under an established name and according to specific rules

Leased department

Section of a store rented to an outside party Operates under store rules Pays a percentage of sales as rent

Types of Retailer by strategy

Convenience store Conventional supermarket Food-based supermarket Combination store Specialty store Category killer Traditional department store Full-line discount store Warehouse club

Convenience store

Well-situated Food oriented Limited assortment Low service High prices

Conventional supermarket

Departmentalized food store Food Related products

Food-based superstore

Broad range of food and non-food items

Combination store(supercenter/hypermart) General merchandise and grocery items General merchandise25-40% of sales Efficient operations Increased impulse purchases Greater number of transactions

Specialty store

Limited variety Great depth Usually one product line, or several related

product lines

Category killer

“discount specialty store” Especially large specialty store

Traditional Department Store

Great variety Depth of assortment varies by department Often anchor stores Average to above average prices

Full- line discount store

Low prices Low service Broad variety Shallow assortment Lower rent locations

Warehouse club

Wholesale and retail consumers Pay yearly dues for membership

Non-store retailers

Direct marketing Vending machine Direct selling

Direct marketing

Consumer is exposed to a good or service by a non-personal medium

Order by mail, phone or PC

Vending machine

Coin or card operated machinery to dispense goods or services

Require intensive training Cards and electronic tracking

Direct selling

Involves personal contact with consumers in their homes and other non-store locations and phone solicitations Phone Referrals Party method

Considerations

Location Atmosphere Scrambled merchandising

Location

Isolated Unplanned business district Planned shopping center

Atmosphere

Physical attributes of a retailer that are used to develop an image and draw customers Exterior General interior Store layout Display

Scrambled merchandising

Adding goods and services that are unrelated to each other and the firm’s original business One stop shopping

Increased traffic High profits

Increases competition

Technological advances

Computerized POP Self-checkout Video kiosks Site selection software Networking distribution Anti-theft developments Computerized reorder