Quiz

• Retailing is the sale of goods and services to the public for consumption, covering a wide range of customer needs
• Retailing is a distribution process that includes all activities involved in selling merchandise directly to the final consumer
• Retailing is undergoing significant change today due to factors like e-tailing, price competition, demographic shifts, and store size
• 1. tailing refers to the sale of goods and services through the internet
• Brick-and-mortar businesses offer products and services face-to-face in an office or store
• The internet has made consumers better informed, increasing their power in transactions with retailers
• Price competition involves companies selling products or services at lower prices than competitors
• A price war is aggressive pricing strategies where companies repeatedly cut prices below competitors
• Costco is a retail giant known for its unique business model, customer focus, and commitment to low prices
• Costco's key elements include a membership-based model, minimal advertising, strong private label brands, and employee satisfaction
• Demographic shifts in retailing are influenced by varying age segments like Baby Boomers, Gen X'ers, Millennials, and Gen Z
• Successful retailers must become more service-oriented, offer better value, be more promotion-oriented, and be attuned to customers' needs
• Market share represents the percentage of an industry or market's total sales earned by a particular company over a specified time period
• As stores increase in size, retailers often employ a scrambled merchandising strategy with many different and unrelated items
• Retailers have seen a decrease in average store size and number in formats like department stores and category killers
• A category killer is a large retail chain superstore dominating its product category and displacing specialized merchants
• Department stores offer a wide variety of goods and are the largest form of organized retailing, mainly in metro cities
• Convenience stores are small stores near residential areas offering limited convenient products and services
• Supermarkets are large self-service outlets offering a wide variety of food and household merchandise
• Hypermarkets combine supermarkets and department stores, offering various products at cheaper prices
• Specialty stores focus on selling specific shopping goods like jewelry, apparel, computers, and sporting goods
• The Home Depot and Lululemon are examples of a category killer and a specialty store, respectively
• The text mentions using WPS Office for the best experience
• It also provides options to open with WPS Office or a browser
• Strategic planning is crucial for adapting a firm's resources to the opportunities and threats in a dynamic retail environment
• Retailers aim to achieve and maintain a balance between available resources and future opportunities through strategic planning
• Components of strategic planning:

  • Statement of mission
  • Goals and objectives
  • SWOT analysis (Strengths, Weaknesses, Opportunities, Threats)
  • Strategy
• Mission statement:

  • Describes the fundamental nature, rationale, and direction of the firm
  • Includes how resources are used, adaptation to the environment, and values provided to consumers
• Statement of goals and objectives:

  • Provides specific direction and guidance to the firm
  • Acts as a control mechanism by setting standards for performance evaluation
• Market performance objectives:

  • Determine the level of dominance the retailer seeks in the marketplace
  • Market share is calculated as the retailer's total sales divided by total market sales
• Financial objectives:

  • Profit-based objectives focus on the monetary return desired by the retailer
  • Profit can be expressed as a percentage of net sales or in terms of return on investment (ROI)
• Financial objectives also include:

  • Stockouts: products that are out of stock
  • Productivity objectives: sales objectives per unit of resource input (space, labor, merchandise)
• Strategies:

  • Carefully designed plans to achieve goals and objectives
  • Retailers operate with strategies to attract shoppers, convert them into customers, and minimize operating costs
• SWOT analysis:

  • Strengths, weaknesses, opportunities, threats
  • Identifies competitive advantages, internal weaknesses, environmental trends, and potential impacts on the firm
• Better forms of differentiation for retailers:

  • Physical product differentiation
  • Selling process differentiation
  • After-purchase satisfaction
  • Location differentiation
  • Avoiding stockouts
• Retail Strategic Planning and Operations Management Model:

  • Operations management maximizes efficiency in resource use
  • High profit in retailing is linked to the competitive nature of the industry
• Retail marketing strategy:

  • Includes target market, location, retail mix, and value proposition
  • Value proposition: clear statement of benefits customers receive from shopping at the retailer
• Population Trends:

  • Retailers group consumers based on population variables like growth trends, age distributions, ethnic makeup, and geographic trends
  • Useful for understanding marketplace needs and easily analyzing markets
• Population Growth:

  • Any increase in domestic population growth leads to increased demand for goods and services
  • Minimal growth in total population creates opportunities for retailers
  • As growth slows, retailers focus on market share, managing margins, and international expansion
• Age Distribution:

  • Retailers must understand the needs of each age segment and what motivates consumers to spend
  • Older consumers need easy-to-navigate store layouts and clearly labeled merchandise
  • Retailers need to shift services to reach young, technology-savvy consumers