Chapter 5

Retail
Institutions by
Store-Based RETAIL
Strategy Mix MANAGEMENT:
A STRATEGIC
APPROACH,
10th Edition

BERMAN EVANS
 Retailer Strategy Mix
• Retailer can be categorised on the basis of strategy
mix
• A strategy mix is the firm’s particular combination of:
 store location,
 operating procedures- employeee
involved,working hours,management style
 goods/services offered,
 pricing tactics,
 store atmosphere- physical facilities
 customer services- delivery
 promotional methods

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 Earning Destination Retailer Status

Destination retailer ie distinct and customer can go out of

way to reach it
Be price-oriented and cost efficient
Be upscale- full services
Be convenient- nearby and long hours
Offer a dominant assortment- variety
Offer superior customer service
Be innovative or exclusive

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 Wheel of retailing

• Acc to this theory , retail innovator first appear a low

priced operators with low cost .Then they upgrade
the products and services and thus prices rise
.Over time they mature have high prices ,good
services but they become vulnerable to innovators
with lower cost.This is wheel of retailing

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 Figure 5-1: The Wheel of Retailing

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 • When traditional discount stores prices became too high for some
consumer ,then emerged full line discount stores like wal
mart,Vishal,V mart offering products at low prices due to high stock
turnover,or low rent tore location. These discount stores then move
up the wheel- improved locations ,large assortment, accepting credit,
good fixtures which led to high prices .At this point these stores face
threat from from newer discount retailer like factory outlets,web
retailers.This is wheel of retailing

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 Scrambled Merchandising

• It involves increasing width of assortment i.e no of

different products may be unrelated

• Width of assortment is the no. of different product

lines
• Depth of assortment is the selection within the
product line

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 Figure 5-3: Scrambled Merchandising
by a Shoe Store

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 Retail Life Cycle

• Retail institutions pass through identifiable life

stages
 Introduction- online rental of books ( book
me a book .com), Tat Sky outlets
 Growth-electronic goods outlets ( e zone),
cosmetics store, fast food outlets
 Maturity-movie rental stores in metros,
bicycle store in towns
 Decline- Bicycle rentals,
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 Table 5-1: Store-Based
Retail Strategy Mixes
Food-Oriented General Merchandise
 Convenience store  Specialty store
 Conventional  Traditional department
supermarket
 Full-line discount store
 Food-based
superstore  Variety store
 Combination store  Off-price chain
 Box (limited-line)  Factory outlet
store  Membership club
 Warehouse store
 Flea market

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 Convenience Store Strategy Mix

Prices:
Location:
Average to
Neighborhood
Above average

Atmosphere and
Merchandise: Services:
Medium width Average
and low depth
of assortment; Promotion:
average quality Moderate
E.g- Kirana stores

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 Conventional Supermarket
Strategy Mix

Location: Prices:
Neighborhood Competitive

Atmosphere and
Merchandise: Services:
Extensive width and Average
depth of assortment;
Promotion:
average quality; Heavy use of
manufacturer, private, newspapers, flyers,
and generic brands and coupons
E.g- Big Bazaar

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 Food-Based Superstore
Strategy Mix
Location:
Prices:
Community shopping
Competitive
center or isolated site

Atmosphere and
Services:
Merchandise: Average
Full assortment plus
Promotion:
health and beauty aids Heavy use of
and general merchandise newspapers, flyers
e.G MORE,Reliace fresh, spencer
A

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 Combination Store
Strategy Mix
Location:
Prices:
Community shopping
Competitive
center or isolated site

Atmosphere and
Services:
Merchandise: Average
Full assortment plus
health and beauty aids Promotion:
and general merchandise Heavy use of
newspapers, flyers
e.g-v mart

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 Warehouse Store Strategy Mix

Location:
Prices:
Secondary site, often in
Very low
industrial area

Atmosphere and
Merchandise: Services:
Moderate width and Low
low depth of
assortment; emphasis on Promotion:
manufacturer brands Little or none
bought at discount Eg Super warehouse

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 Specialty Store Strategy Mix

Location: Prices:
Business district or Competitive to
shopping center Above average

Atmosphere and
Merchandise: Services:
Very narrow width and Average to excellent
extensive depth of Promotion:
assortment; average to Heavy use of displays
Extensive sales force
good quality Eg- food bazaar, sony world,
Music world

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 Traditional Department Store
Strategy Mix
Location: Prices:
Business district, shopping Average to
center or isolated store Above average

Atmosphere and
Merchandise: Services:
Extensive width and Good to excellent
depth of Promotion:
Heavy ad and catalog
assortment; average to use; direct mail;
good quality personal selling
Eg-shoppers stop,food world

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 Full-Line Discount Store
Strategy Mix
Location:
Prices:
Business district, shopping
Competitive
center or isolated store

Atmosphere/Services:
Merchandise: Slightly below
Extensive width and average to average
depth of Promotion:
assortment; average to Heavy on newspapers;
price-oriented; selling
good quality E.g-Wal Mart

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 Variety Store Strategy Mix

Location:
Prices:
Business district, shopping
Average
center or isolated store

Merchandise: Atmosphere/Services:
Good width and Below average
some depth of
assortment; Promotion:
below-average Use of newspapers
to average quality EgAnupam variety store

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 Off-Price Chain Strategy Mix

Location:
Prices:
Business district, shopping
Low
center or isolated store

Merchandise: Atmosphere/Services:
Moderate width and Below average
poor depth of
Promotion:
assortment; Use of newspapers;
average to good quality; brands not advertised;
low continuity limited selling
Eg-levis factory outlet

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 Factory Outlet Strategy Mix

Location:
Prices:
Out of the way site
Very Low
or discount mall

Atmosphere/Services:
Merchandise: Very low
Moderate width and
poor depth of
assortment; Promotion:
low continuity Little
Eg- liberty factory outlet

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 Membership Club Strategy Mix

Location:
Prices:
Isolated store or
Very Low
secondary site

Atmosphere/Services:
Merchandise: Very low
Moderate width and
poor depth of Promotion:
assortment; Little;
low continuity some direct mail
Eg- Sam’s club

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 Flea Market Strategy Mix

Location: Prices:
Isolated store Very Low

Merchandise:
Extensive width and Atmosphere/Services:
poor depth of Very low
assortment; Promotion:
low continuity; Limited
variable quality Eg- Anjuna market goa
May be second hand goods, Janpath,palika bazaar

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