A set of business activities that addsvalue to the products and services sold to consumers for their personal or family use
Retailer
A business that sells products and/or services to consumers for their personal or family use
Functions of a Retailer
Sells finished goods or services in the form that customer wants
Buys a widerange of products from different wholesalers and offers the best products under one roof
Keeps the products or services within easyreach of the customer by making them available at appropriate location
Differences between Retailers and Wholesalers
Social interaction and interpersonal sales techniques
Sell small quantities of items
Provide convenience in terms of location, payment and credit facilities, range of merchandise, after-sales service
Offerselection - an assortment of merchandise
Set up in business to trade with the generalpublic
Normally charge higher unit prices
Pricing policy tends to be simpler
Bears a different kind of risk
Retail management
The various processes which help the customers to procure the desired merchandise from the retail stores for their end use
Distribution channel
A set of firms that facilitate the movement of products from the point of production to the point of sale to the ultimate consumer
Supply chain
A set of firms that make and deliver goods and services to consumers
Logistics management
Includes all activities involved in physically moving raw material, in-process inventory, and finished goods inventory from the point of origin to the point of use or consumption
Marketing channel system
Vertical Integration - firm performs more than one set of activities in the channel; operating its own distribution centers to supply its stores
Backward Integration - retailer performs some distribution and manufacturing activities; operating warehouses or designing private levels
Balance Integration - a combination of both backward and forwards integration, where a company mergers' with both a company that is before it in the supply chain, as well as one that is after
Social and economic significance of retailing
Support for community
Retail sales
Employment
Managementtrainingopportunities
Entrepreneurial opportunities
How retailers add value
Provideassortments - buy other products at the same time; wide selection of brands, design, sizes, colors and prices at one location
Break bulk - buy it in quantities the customer wants
Holdinginventory - products will be available when consumers want them
Providingservices - consumers can see and test the product before buying; consumers can have the product now and pay it later
Intratype competition - competition between the same type of retailers
Intertype competition - competition between retailers that sell similar merchandise using different formats
Variety - is the number of different merchandise categories within a store or department
Scrambledmerchandising - the offering of merchandise not typically associated with the store type
Misconceptions about careers in retailing
Don't need college
Low pay
Long hours
Boring
Dead-end job
No benefits
Everyone is part-time
Unstable environment
VerticalIntegration
Firm performs morethanoneset of activities in the channel; operating its owndistribution centers to supply its stores
Backward Integration
Retailer performs some distribution and manufacturing activities; operating warehouses or designing private levels
Forward Integration
Manufacturers undertake retailing activities
Balance Integration
A combination of both backward and forwardsintegration, where a company mergers' with both a company that is before it in the supply chain, as well as one that is after
IntratypeCompetition
Competition between the same type of retailers
IntertypeCompetition
Competition between retailers that sell similarmerchandise using differentformats
Variety
The number of different merchandise categories within a store or department.
ScrambledMerchandising
The offering of merchandise not typically associated with the store type.