business model in retail
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Business model in retail
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Business chooses to server its customers
and stakeholders
Dictate the product/services Pricing policy, communication strategy
Size and look
Location of his retail store.
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Classification of Retail formats
Classification
Store base
retailing
Non-store
Retailing
Service
Retailing
Ownership Merchandise
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Basis of Ownership
Independent retailer
Chain retailer
Franchise Leased departments
ConsumerCo-operatives
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Independent retailer
Owns and operates
only one retail outlet
Family members
Passed from
generation to
generation
Eg local baniya/kirana/panwala
Amarsons, Premsons
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Chain retailer
Two or more outlets
operated under
common ownership
Similarity in the
merchandise offered,
the ambience,
advertising and
promotions
Eg- Van Heusen,
Food World, Music
world
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Advantages
Bargaining power with the suppliers
Cost effectiveness
Disadvantage-not possible to take into account
regional or rural and urban preferences.
- Attention to each of the storesbecomes fairly restricted.
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Franchising
Contractual agreement between the
franchiser and the franchisee.
Conduct business under an establishedname as per a particular business format
Product or trade mark franchise
Abusiness format franchise
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Product franchise
Sells the products
and operates under
the franchisers name.
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Leased departments
Shop-in-shops
Section of a department in a retail store is
leased leased department Expand product offering to the customers
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Consumer co-operatives
Owned by its member customers
May rise because of dissatisfied
consumers whose needs are not fulfilledby the existing retailers.
Example Sahakari Bandar
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Basis of the Merchandise
offered Convenience sores
Super markets
Hyper market Specialty stores
Departmental stores
Off price retailers Factory outlets
Catalogue showrooms
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Convenience stores
Small stores located near residential areas
Opened for long hours
24x7 Limited line of convenience products like
eggs, bread, milk
3000-8000 sq ft(Int) , 500-1000 (India) Targeted at customers who want to make
their purchase quickly.
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In & out
International retailers 7-Eleven, Circle K,
Albert Heijn
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Supermartket
Large, low cost, low margin
High volume, self serviced operations
designed to meet the needs for food,groceries and other non-food items.
8000-20000(Int) , 800-5000(India)
&
0%foodstuff and everyday commodities
Nilgiris, Food world, Subhiksha
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Hypermarket
Hypermarche combination of a
supermarket and a department sore.
C
arrefour (Sainte Genevieve des BoisnearParis)
80,000-22,0000 sq.ft (Int) 40,000-
75,000(India)
35% of selling space devoted to non-
grocery products
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Store offers large depth in product mix
Food and non food items
Apparel. CDs, DVDs, footwear Low price for the products is key attraction
for the customer
Eg Big Bazaar, Wal-Mart.
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Specialty sores
Particular type of merchandise
High level of service or product information
being made available o customer Narrow product line
Deep assortments
Apparel, jewellery, sporting goods,furniture
5000-8000(Int) 2000-5000( India)
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Example- Crossword, Music world
The Gap, IKEA, High & Mighty (
International players)
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Department stores
Aristide Boucicaut founder of department
sore Bon Marche
Selling different types of goods under oneroof
Large scale retail outlet
75,
000+ (
Int), 5
000-
40000(
Ind)
50000-100000SKU
Marks & Spencer's, Harrods(Int)
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Westside, Lifestyle, Shoppers stop
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Off price retailers/Factory
Outlets Product sold less than retail price
Off price retailers buy manufacturers
seconds, overruns and off seasons atdeep discount
Odd sizes, unpopular colours or with minor
defects
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Catalogue showroom
Specialise in hard goods
Consumer electronics, house ware,
jewelley Catalogue
Argos
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Category killers
Speciality retailers
Large selection in the chosen product
Economical prices 50,000+, 15,000+
Toys R Us, Toys Kemp
The Loft 15,000 sq ft
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Warehouse clubs
Offers a variety of goods, in bulk
Limited number of product items
1,04,000 sq ft 1,70,000 sq ft Eg Sams club
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Other formats
Super warehouse stores
Limited assortment store
Super centre Wholesale club
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Super warehouse store
A hybrid warehouse/superstore
50,000 + items
High quality perishable and reduced prices
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Limited assortment
A low price outlet
Minimal service
2,000 items Numerous private label products
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Super center
A large food-drug combination store
Mass merchandiser
170,000 sq ft 40% - grocery items
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Non-store
Retailing directly to the consumers
Direct selling and direct response
marketing Direct selling direct personal
Direct response marketing create
awareness through non personal medium
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Direct selling
Personal contact with the end customers
Cosmetics, jewellery, food and nutritional
products 3,000 crore- turnover
Women -70%
Modicare, Amway Party plan or Multilevel
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Direct response
Includes various non personal
communication
Catalogue retailing/ Mail order
Television retailing
E-tailing