INTRODUCTION 2 RETAILING
A set of business activities involved in selling goods and services to consumers for their personal, family, or household use.
A retailer is a business that sells products and/or services to consumers for personal or family use.
Examples of Retailers . . .
Retail Shops . . .
The 10 Largest Retailers in the United States
Rank 1 Company Wal-Mart Main Emphasis Full-line discount stores, supercenters, membership clubs Home centers, design centers
Home Depot
Kroger
Supermarkets, convenience stores, jewelry stores Full-line discount stores, supercenters Membership clubs Supermarkets, drugstores Drugstores Home centers Department stores, specialty stores Supermarkets
4 5 6 7 8 9 10
Target Costco Albertsons Walgreens Lowes Sears Safeway
Retail Process
POS
ERP
Reports & Transactions
Retail formats in INDIA
India is fifth most attractive emerging retail market: a potential goldmine. Indian retail is largest among all industries(200 billion $).
10% - Indias GDP.
Growth rate 20-25%
8% - employment
Potentiality to grow 427 billion $ by 2010 and 637 billion $ by 2015.
Retail formats in INDIA
Malls Hyper marts / Super marts Specialty stores Convenience stores Discount stores Multi brand outlets
Department stores
Growth of Retail in INDIA
INDUSTRY REVOLUTION
Textiles sector with companies like Bombay Dyeing, Raymond's, S Kumar's and Grasim first saw the emergence of retail chains
1990s saw a fresh wave of entrants with a shift from Manufactures to Pure Retailers.
For e.g. Food World, Subhiksha and Nilgiris in food and FMCG; Planet M and Music World in music; Crossword and Fountainhead in books.
Post 1995 onwards saw an emergence of shopping centers. Emergence of hyper and super markets trying to provide customer with 3 Vs - Value, Variety and Volume.
Manufacturers Perspective
Retailers are part of the distribution channel
A Typical Channel of Distribution
Manufacturer Retailer
Wholesaler
Final Consumer
The Retailers Role in the Sorting Process
Distribution Types
Exclusive: suppliers make agreements with one or few retailers that designate the latter as the only ones in a specified geographic area to carry certain brands or products
Intensive: suppliers sell through as many retailers as possible Selective: suppliers sell through a moderate number of retailers
Multi-Channel Retailing
A retailer sells to consumers through multiple retail formats
Web sites Physical stores
Retail Strategy
An overall plan for guiding a retail firm
Influences the firms business activities
Influences the firms response to market forces
Retail Strategy
Merchandise Assortments Location
Customer service
Store Design & Display
mixing
Pricing
Six Steps in Strategic Planning
1.
2.
Define the type of business
Set long-run and short-run objectives
3.
4. 5. 6.
Determine the customer market
Devise an overall, long-run plan Implement an integrated strategy Evaluate and correct
Pay Less + Expect More at Target
Aspects of Targets Strategy
Growth objectives
Appeal to a prime market Employee relations Innovation
Distinctive image
Focus
Commitment to technology
Community involvement Monitoring performance
Customer service
Multiple points of contact
Applying the Retailing Concept
Customer Orientation
Coordinated Effort
Retailing Concept
Retail Strategy
Value Driven Goal Orientation
Eliminating Shoppers Boredom
Customer Service
Activities undertaken by a retailer with the basic
goods and services
Store hours
Parking
Shopper-friendliness Credit acceptance Salespeople
How Retailers Add Value . . .
Doll is developed at manufacturer
Doll is developed in several styles
Doll is offered in convenient locations in quantities of one
Doll is featured on floor display
Doll can be bought on credit or put on lay away
Retail Mix
The combination of merchandise, assortment,
price, promotion, customer service, and store layout that best serves the segments targeted by the retailer.
Types of Competition
1. 2.
Intratype Competition Intertype Competition
3.
Divertive Competition
Intratype Competition
It occurs when two or more retailers of the same type, compete directly with each other for the same households.
Intertype Competition
It occurs when two or more retailers of a different type, compete directly by attempting to sell the same merchandise lines to the same households.
Divertive Competition
It occurs when retailers intercept or divert customers from competing retailers.
Market share or profit
Value-retail stores Early growth
On-line retailers
Single-brand stores
Single-price stores Factory outlet stores
The Retail Life Cycle
Accelerated development
Warehouse clubs
Fast food outlets Convenience stores Supermarkets Department stores
Profit
Market share
Maturity Decline
Malls (?)
Catalog Retailers General store
Future Changes in Retail
Nonstore Retailing
New Retail Formats
Integration of Technology Increased use of Private Labels
Heightened Global Competition
Non store Retailing
Direct Selling
Catalog Sales
E-tailing
New Retail Formats
Super centers
Recycled Merchandise Liquidators Retailers
Heightened Global Competition
Increased Rate of Change Greater Diversity Creation of New Retail Formats
Integration of Technology
Supply Chain Management
Customer Customer Management Satisfaction
M.RAVISHANKAR MBA(AB) 2008-2010 Batch NIFTTEA KNITWEAR FASHION INSTITUTE TIRUPUR
[email protected] FIN
