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Retail Management Chaper 1 Introduction

This document provides an introduction to retail management. It defines retailing as the buying and selling of goods and services to end consumers. Retailers act as a link between manufacturers/wholesalers and consumers by breaking down bulk purchases into smaller quantities acceptable to customers. The document outlines the functions of retailers which include buying goods, assembling, storing, developing customer contacts, bearing risks, standardizing goods, and providing market information and delivery. It also discusses the importance of retailing, types of retailers including small and large scale, forms of each, and challenges faced by the retail industry like regulations, supply chain issues, competition, and economic/demographic factors.

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111 views16 pages

Retail Management Chaper 1 Introduction

This document provides an introduction to retail management. It defines retailing as the buying and selling of goods and services to end consumers. Retailers act as a link between manufacturers/wholesalers and consumers by breaking down bulk purchases into smaller quantities acceptable to customers. The document outlines the functions of retailers which include buying goods, assembling, storing, developing customer contacts, bearing risks, standardizing goods, and providing market information and delivery. It also discusses the importance of retailing, types of retailers including small and large scale, forms of each, and challenges faced by the retail industry like regulations, supply chain issues, competition, and economic/demographic factors.

Uploaded by

David Shrsth
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Unit 1: Introduction to

Retail Management
By: Punya ram
Introduction:
The word retail is derived from the French word Retailer,
that is to cut a piece, a break down. 
A retailer buys in large quantity from the middleman or
manufacturer and breaks the bulk in small quantity, sells or
markets them in small quantity to meet the needs of
customers.
He acts as a link between manufacturer or middleman and
consumer. 
He delivers the product or service in a form, size, that is
acceptable to final consumer.
Retailing
Retailing is a convenient, convincing and comfortable
method of selling good and services to the end consumer
and costumer.
Retailing, through as old as business, trade and commerce
has now taken new form and shape.
Retailing is the business where an organization directly
sells its products and services to an end consumers and this
is for his personal use
Definition
Retailing can be defined as the buying and selling of the
goods and services.
It can also be defined as a timely delivery of goods and
services demanded by consumers as price that are
competitive and affordable.
Functions
The retailer buys a variety of products from the wholesaler
or a number of wholesalers.
He thus performs two functions like buying of goods and
assembling of goods.
The retailer performs storing function by stocking the
goods for a consumer.
He develops personal contact with the consumers and gives
them goods on credit.
He bears the risks in connection with Physical Spoilage of
goods and fall in price. Besides
He bears risks on account of fire, theft, deterioration in the
quality and spoilage of goods.
He resorts to standardization and grading of goods in such
a way that these are
accepted by the customers.
He makes arrangement for delivery of goods and supply
valuable market information to both wholesaler and the
consumer.
Importance or retailing
Sales to Ultimate consumers of the products
A convenient form of selling quantity-wise
Convenient Place and Location
The lifestyle of the people are shaped by retailing
Retail businesses contribute to the economy
Retail dominates the supply chain
Retailers provide maximum employment
Provides Comfort and facilities for shopping
Provide services to the manufacturer
Advantage of an expert and specialist
Creates utilities and value
Types of retailers
Small scale retailers
Small scale retailers are those retailers whose scale of
operation is restricted to a small segment of the markets
and to a narrow range of products.
They generally holds small stocks of the products of regular
use.
Such retailers are very large in number but account for a
small portion of the total retail business
Forms of small scale retailers
Itinerants or mobile traders
Fixed shop retailers
Large scale of retailers
Large scale retailers are those retailers whose scale of
operation extends to a large segment of the market and to a
wide range of products.
They have a fixed line of business on which they have
invested huge capital.
Such retailers are not very large in the numbers
This form of retailing involves high operation costs and
lacks of personal contacts with the customers.
It involves more profesnalism in selling the products
through the use of various promotional techniques like
advertising, publicity, sales promotion etc.
Forms of large scale retailers

Departmental stores
Supermarkets
Multiple shops and chain stores
Mail order houses
Consumer cooperative stores
Super bazars
Automatic vending machines
Challenges to Retailing
Regulatory barriers including
Restrictions on real estate purchases, especially as imposed
by local governments and against “big-box” chain retailers;
Restrictions on foreign investment in retailers, in terms of
both absolute amount of financing provided and
percentage share of voting stock (e.g., common stock)
purchased;
Restrictions imposed on scope of operations (e.g., multi-
brand vs. single brand retailing);
Unfavorable taxation structures, especially those
designed to penalize or keep out “big box” retailers;
Cont..
Absence of developed supply chain and integrated IT
management system;
High competitiveness among existing market participants
and resulting low profit margins, caused in part by
Constant advances in product design resulting in
constant threat of product obsolescence and price declines
for existing inventory.
Lack of properly educated and/or trained work force,
often including management, caused in part by
Lack of educational infrastructure enabling prospective
market entrants to respond to the above challenges.
Important variables that affect retail
business success
Competition
Being the only vendor of a product is something every
retailer wants—they want to be the place to buy, to
offer unique value to customers. Consumers, on the
other hand, want options.
Political climate (factor)

State of the economy


When people are feeling confident about their job
prospects and the economy, they buy more. 
Trend
Consumer trends are important for businesses to pay
attention to, because these shifts can have lasting impact on a
business’s success. For example, many consumers are
concerned about how retail products affect the environment,
and are more interested in sustainable options when
shopping.
Technology
Retail has also seen its fair share of changes, including mobile
payments, targeted advertising, big data, and e-commerce.
As time goes on, technology will play an even bigger role in
how we shop—and retailers need to be prepared.
Demographic factor
 Changing age group and target maket.
Thank you..

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