unit iv retailing

8/13/2019 Unit IV Retailing

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RETAILI

NG


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Retail is the final stage of any economic activity.

Retail occupies an important place in the world

economy. The word retail comes from the French retaillier,

which means to cut off a piece or to break bulk.

Retailing is the set of business activities that adds

value to the products & services sold toconsumers for their personal or family use.

People often think of retailing as the sale ofproducts in stores, but retailing also involves the

sale of services. RETAIL MAYBE REDEFINED AS THE FIRST POINT

OF CUSTOMER CONTACT.


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DEFINITION

Retailing- Retailing includes all the activities

involved in selling goods or services to final

consumers for personal, non-business use. A

retailer or retail store is any business

enterprise whose sale volume comes primarily

from retailing.

Philip Kotler


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Retailer-dealer or trader who sells goods in

small quantities or one who repeats or

relates


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A RETAILERS ROLE IN A DISTRIBUTION

CHANNEL-

Retailers attempt to satisfy consumer needs

by having the right merchandise, at the right

price, at the right place, when the consumer

wants it.

Distribution channel is a set of firms that

facilitate the movement of products from the

point of production to the point of sale to theultimate consumer.


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EXAMPLE OF A DISTRIBUTION

CHANNEL-

MANUFACTURI

NG

WHOLESALE

RRETAILER CONSUME

R


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FUNCTIONS OF A RETAILER

1. Providing an assortment of products or

services;

2. Breaking bulk;

3. Holding inventory;

4. Providing services


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Supermarkets often carry 20,000 to 30,000

different items made by 500 companies.

Offering an assortments enables their

customers to choose from a wide selection ofbrands, designs, sizes, colors & prices in 1location.

If manufacturers had its own stores,consumers would have to go to differentstores to buy their groceries!!!

PROVIDING ASSORTMENTS


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BREAKING BULK-

To reduce transportation costs, manufacturers

& wholesalers typically ship cases to retailers.

Retailers then offer the products in smaller

quantities tailored to individual consumers.this is called breaking bulk.

Its important to both manufacturers &

consumers because its cost effective to themanufacturers & easier for consumers topurchase in smaller quantities.


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PROVIDING SERVICES

Retailers provide service that make it easier

for customers to buy & use products.

They offer credit so consumers can have a

product now & pay for it later.

Display of products, salespersons to explain,

flexibility of buying, shipping to homes etc..


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HOLDING INVENTORY

Retailers keep inventory that is broken into

user-friendly sizes so that products will be

available when consumers want them.

By maintaining an inventory, retailers provide

a benefit to consumers- they reduce the

consumers cost of storing products.


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INCREASING VALUE OF PRODUCTS & SERVICES

By providing assortments, breaking, holding

inventory & providing services, retailers

increase the value consumers receive from

their products & services.


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TOP 10 RETAILERS:

1. WAL-MART

2. CARREFOUR

3. KROGER

4. HOME DEPOT

5. METRO

6. AHOLD

7. KMART8. ALBERTSON

S

9. SEARS

10. TARGET(DAY

TON

HUDSON)

1. U.S2. FRANCE

3. U.S

4. U.S

5. GERMANY

6. NETHERLANDS

7. U.S8. U.S

9. U.S

10. U.S

Name of

Company

Country of

Origin


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RETAIL MANAGEMENT DECISION PROCESS

The world of retailing

1. Introduction to the world of retailing

2. Types of retailers

3. Multichannel retailing

4. Customer buying behaviour

RETAILING STRATEGY

5. Retail marketing strategy

6. Financial strategy

7. Retail location

8. Site location

9. Organisation structure & Human resource Management

10. Information System & Supply Chain Management

11. Customer relationship Management


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RETAIL MARKET STRATEGY


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etailStrategyRetailers target market.

Format the retailer plans to satisfy targetmarket needs.

Build sustainable competitive advantage.


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SUSTAINABLE COMPETITIVE ADVANTAGE

Customer loyalty.

Location.

Human resource management.

Distribution and information systems.

Unique merchandise.

Vendor relations.

Customer service.


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Growth strategies

Market penetration.

Market expansion.

Retail format development.

Diversification.


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Criteria for evaluating market

segments

Actionability- must clearly indicate what the

retailer should do to satisfy its needs.

Identifiabilityhelps retailers to identify

customers in a target segment. Accessabilityability of the retailer to deliver

the appropriate mix to the customers in the

segment. Sizetarget segment must be large enough to

support a unique retailing mix.


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Approaches to sementing markets

Geographic segmentation: groups customer

by where they live

Demographic segmentation: groups customers

on the basis of easily measured characteristics

such as age, gender, income , etc.

Geodemographic segmentation: uses both

geographic and demographic characteristics ti

classify customers.


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Lifestyle segmentation: refers how people live,

how they spend the time, their activities,

attitudes, opinions, etc.

Buying situation segmentation: buying behaviour

of customers.

Benefit segmentation: grouping customers with

similar benefits


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Customer buying behaviour


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Types of customers decision-making process:

Extended problem solving: a decision process inwhich customers devote considerable time and

effort to analyzing alternatives.

Limited problem solving: involves a moderate

amount of time and effort.

Habitual decision making: a purchase decision

process involving little or no conscious effort.


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The buying process:

The process consists of the following stages

evaluation

Information search

Need recognition

loyalty

visit

choice


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Need recognition:

The buying process is triggered when people recognizethey have an unsatisfied need. An unsatisfied need ariseswhen a customers desired level of satisfaction differs from

his or her present level of satisfaction.

Information search:

The customers may seek information about retailers or

products to help them satisfy the need.

Evaluation:

Based on the information attained, they evaluate thealternative products and select one to satisfy their needs.


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Social factors influencing decisions

Family

Reference groups

Culture

Market segmentation:

A retail market segmentation is a group of

customers whose needs are satisfied by the

same retail mix because they have similar

needs


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Criteria for evaluating market

segments

Actionability- must clearly indicate what the

retailer should do to satisfy its needs.

Identifiabilityhelps retailers to identify

customers in a target segment. Accessabilityability of the retailer to deliver

the appropriate mix to the customers in the

segment. Sizetarget segment must be large enough to

support a unique retailing mix.


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Approaches to sementing markets

Geographic segmentation: groups customer

by where they live

Demographic segmentation: groups customers

on the basis of easily measured characteristics

such as age, gender, income , etc.

Geodemographic segmentation: uses both

geographic and demographic characteristics to

classify customers.


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Lifestyle segmentation: refers how people live,

how they spend the time, their activities,

attitudes, opinions, etc.

Buying situation segmentation: buying behaviour

of customers.

Benefit segmentation: grouping customers with

similar benefits


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TYPES OF RETAILING


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GENERAL MERCHANDISE RETAILERS

DISCOUNT STORES

SPECIALITY STORES

CATEGORY SPECIALISTS

HOME IMPROVEMENT CENTRES

DEPARTMENT STORES

DRUG STPORES

OFF-PRICE STORES

VALUE RETAILERS


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NON STORE RETAIL FORMATS

ELECTRONIC RETAILING

DIRECT SELLING

TELEVISION HOME SHOPPING

VENDING MACHINE RETAILING

SERVICES RETAILING


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Key to success

Globally sustainable competitive

advantage

Adaptability

Global culture

Deep pockets

Global Growth Opportunities


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The Strategic Retail Planning Process

Define the business mission

Conduct a situation audit

Identify strategic opportunities

Evaluate strategic alternatives

Establish specific objectives and allocate resources

Develop a retail mix to implement strategy

Evaluate performance and make adjustments


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APPENDIX


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unit iv retailing

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