Retail Management Course Objectives Explain What is Retail

Retail Management

Course Objectives • • • • Explain What is Retail Management Describe the Benefits of Retailing Explain the Retail Selling Process Explain the Classification of Retailers Explain the Components of Retailing Concept Explain the Steps of Retail Strategy Planning Explain What is Franchising Explain What is Merchandising Explain What is Visual Merchandising Describe the Importance of Location in Retailing Explain the Types of Retail Location Explain What is a Private Label Explain the Process of Creation of Private Label List the Myths about Careers in Retailing List the Tips for Success in Retailing

Introduction Look at the logos of some of the leading organizations across the world. What do you think is common among the companies shown? All the companies whose logos have been shown are ‘retailers’.

Introduction Thus, each one of the companies shown sells directly to the final consumers. They also render services that are incidental to the sale of such goods. All these retailers are establishments that are engaged in selling merchandise for personal or household consumption.

Introduction Let us look at the various aspects of retail management in detail. Therefore, like any business, it is very important to manage a retail business and its various components. In fact, the retail industry is one of the fastest growing and biggest sources of employment across the globe.

Definition Now, let us look at a few definitions that will be useful while you study retail management. The word ‘Retailing’ is derived from the Retailing Retailer Wholesaling Wholesaler French verb ‘retailer’, which means, "to cut a piece off. ” Retailing is defined as all business activities that are involved in selling goods or services directly to the final consumers for their personal, family or household and non-business use. Whereas, from a marketers point of view, retailing is defined as a set of marketing activities that are designed to provide satisfaction to the end consumer and profitably maintain the customer base by continuous quality improvements across all areas concerned with selling goods and services.

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Role of Retailer in Channel of Distribution Manufacturer Wholesaler Retailer Final Consumer

Benefits of Retailing • Benefits to Customers Breaking Bulk : One of theofmajor benefits that retailers Benefits Retailing to Customers: pass on to their customers is through their For consumers or customers, the retailers act as buying agents. Retailers perform activity of ‘breaking bulk’. This is because various activities that increase the value of goods and services that are then retailers buy goods in bulk from ultimately sold to the end consumer. The various activities performed by the manufactures. They then divide the bulk retailers that ultimately benefit the customers are as follows: goods into smaller saleable units as per the • Breaking Bulkof the end consumer. consumption patterns • Providing Assortment • Holding Inventory • Providing Services • Providing Information Let us look at each activity in detail.

Real Life Example Providing Assortment: Retailers evaluate the products of various manufacturers; they then choose and offer the best assorted collection of products depending on the tastes and needs of their target customers. Hence, consumers get a wide range of products and prices to choose from as per his/her choice. Therefore, the offered variety in assortment makes the buying process easier for customers.

External Environment Affecting Retailing 3 Technological Environment: One of the major factors that drive change in the retail industry is ‘Technology’. Across the globe, the manner in which retailing is carried out has changed drastically due to the computerization of various retail store operations through the advent of computers, MIS etc. Technology is now being used in the retail industry as a means to improve the shopping environment and to provide a pleasant shopping experience to the customer.

Retail Marketing Mix The following are the components that make up the ‘Retail Marketing Mix’: Customer Service Presentation People Retail Marketing Mix Promotion Product Price Place

Classification of Retailers • Amount of Service Self-service Retailers Limited-service Retailers Full-service Retailers can be classified based on the ‘amount of service’ they offer to their customers. Hence, based on the amount of service offered to customers, retailers can be such as follows: Limited-service Retailers: In such retail stores, the customers are offered limited service rather than a completely self-serving mode. Such retail stores are such as discount stores, most department stores etc.

Classification of Retailers • Organizational Approach Corporate Chain Stores Retailers can be classified based on the ‘organizational approach’ they choose for their business. Hence, based on the organizational approach, retailers can be such as follows: Voluntary Chains Retailer. Cooperatives Retailer Franchise Organizations Merchandising Conglomerates Retailer Cooperatives: These stores are operated by groups of independent retailers who buy in bulk.

Components of Retailing Concept One of the key components of the retailing concept is ‘customer orientation’. A retailer always determines the attributes and needs of its customers. He then endeavors to take action in order to satisfy these needs of his customers. A retailer must always make a coordinated effort to succeed. Hence, a retailer integrates all his plans and activities to maximize efficiency. One of the primary things that a retailer should aim to offer to his customers is a ‘good value proposition. Hence, a retailer must offer good value to the customers, through ‘appropriate pricing’ for goods and customer service. Customer Orientation Coordinated Effort Retailing Concept Value-driven A retailer should always set goals and then use strategy to attain them. Goal Oriented

Classification of Retail Institutions The given flowchart shows the classification of retail institutions: Ownership: • • • Independent Chain Franchise Leased Department Vertical Marketing System Consumer Cooperative Non-store Based Retail Strategy Mix Store-based Retail Strategy Mix: • Convenience Store • Conventional & Foodbased Supermarket • Box (limited line) Store • Warehouse Store • Specialty Store • Variety Store • Traditional & Full-line Department Store • Off-price Chain • Factory Outlet • Flea(louse) Market Non-store Based Retail Strategy Mix & Nontraditional Retailing: • • Direct Marketing Direct Selling Vending Machine World Wide Web (WWW)

Real Life Example Let us now understand how the concept of franchising works through SUBWAY® Restaurants were started way back in 1965 by a seventeen-yearold Fred De. Luca had just completed his high school and he aspired to become a medical doctor.

What is SKU? • SKU is an acronym for Stock Keeping Unit. • SKU is a unique numerical identifying number. • This unique number refers to a specific stock item in a retailer's inventory or product catalog.

Retail Life Cycle The given image shows the ‘Retail Life Cycle’ of any retail establishment.

Importance of Location in Retailing • Location decides and influences the merchandise mix and interior layout of the store based on the locality and neighbors surrounding the store. • Hence, vice versa, the choice of the location of the store also depends on the target audience and kind of merchandise to be sold. • It is important to keep in mind that once the store comes into existence, it is very difficult to change the location as changing the location of a store may result in loss of customer and employees.

Private Label In certain cases, a store may belong to a wholesale buying group. This wholesale buying group may own labels, which are made available to the members of the group. Hence, this whole-sale owned labels are referred to as controlled labels. Controlled labels can be used by the retailer belonging to that wholesale group.

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