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RETAILING

Retailing is the act of selling products or services to people for their personal, no business use. A retailer is a business that specialises in the act of retailing primarily. With such a broad definition, the types of retailers are vast and are categorized based on their different characteristics. The distinctive characteristics and examples that are most relevant to me as a consumer are below:Amount of Service

The amount of service that is offered from a retailer attracts different consumers as different consumers and products being sold require different levels of service:

1.Self-service retailers — customers who are willing to find the items they want and compare the prices of similar products by themselves to save both time and money

2.Limited-service retailers — customers shop on their own but have a higher availability of service from sales assistants due to the increased amount of product available

3.Full-service retailers — customers are given more attention, as this style is usually a part of high-end stores carrying more specialty goods that customers need advice

Product Line

The number and diversity of products that they offer to consumers can also categorize retailers.

1. Specialty stores — retailers that sell a very narrow selection of products but have a deep array of variations within each of those product lines, recently increased in popularity

2.Department stores — these stores carry a large variety of different product lines and are viewed as a more flexible version of specialty stores, often differentiated on level of service

3.Supermarkets — these retailers are the most frequently visited and operate on mostly self-service as they are designed to fulfill consumers grocery and household items needs with their high volumes of product

4.Convenience stores — reatilers that carry a low volume of convenience goods that have accommodating locations and hours for consumers but have relatively higher prices on items

5.Superstores — stores that are similar to supermarkets and offer a more diverse assortment of products and services

6.Category killers — stores that are extremely large and carry a very diverse assortment of a minimal product line

7.Service retailers — product being offered is a service

Relative Prices

One of the easiest ways for retailers to be classified is by the varied prices they offer. Normally, the prices offered correlate directly with the quality of the goods or services offered by the retailers

1.Discount stores — offer standard merchandise at lower prices by selling at high volumes and offering few services to consumers, typically utilize warehouses

2.Off-price retailers — extremely low prices and high volumes of products

a. Independent off-price retailers—divisions of larger retail stores that are usually owned by retail chains.

b. Factory outlets — retailers owned by the name brand firms that offer lower priced versions of its products to consumers, usually grouped together in their own factory outlet malls

3. Warehouse clubs — often require customers to have memberships in order to purchase large volumes of product at extremely low prices in bare-bones warehouse environments.

Organisational Approach

Finally, retailers can be categorized based on the organizational structure that they are based upon:

1. Corporate chains — two or more retailing outlets that are controlled and owned by a common entity

Voluntary chains- retailers that are sponsored by a retailer and buys common merchandise as a group (i.g. insurance companies)

b.Retail cooperatives — independent retailers that use joint owned wholesale locations with joint merchandising and promotion efforts.

2. Franchise organizations — a retailer that has a contract with a wholesaler, manufacturer,, service organization, or independent person who owns the right to conduct business in more than one location.

WHOLESALING

As opposed to retailing, wholesaling is the act of selling products or services for the use in businesses. That being said, the wholesaling diversity is much more narrow than that of the retailing industry. The types of wholesalers are listed and described below:

1.Merchant wholesalers — wholesalers that are independently owned and place their names on the products that are sold by them

2.Brokers— wholesalers who make the connections between buyers and sellers by assisting and negotiating, but do not apply their names to the products

3.Agent — a consistently used wholesaler who preforms a minimal amount of functions for a buyer or seller and does not place their name on the products

4.Manufacturer’s sales branches and offices — wholesalers that utilize buyers and sellers rather than relying on independent wholesalers

 

What are the advantages and disadvantages of retailing?

 

Personal Interaction

Retail marketing involves personal interaction that most other forms of marketing just do not entail. Personal interaction is meaningful on many levels to the client and can result in a lasting relationship between the brand and the consumer.

Relationships are the foundation for future sales and a major factor in the customer’s decision to select your goods or services over the competition. A certain amount of staff training and selective hiring is required to ensure the type of personal interaction that maximizes your company’s retail marketing potential.

Real-Time Control

Retail marketing is easier to control, adjust and customize according to the situation, the specific customer and the needs of the brand. Unlike a print ad that will run for a predetermined length of time and cannot be altered, or a radio spot that must be rerecorded if changes are necessary, retail marketing can change from one day or even one hour to the next as the market and the conditions warrant. For example, if you are running a sale on widgets and notice that they are still not selling, you can change the promotion into a giveaway.

One widget free with every $50 spent in the store. This accomplished your goal of moving the widgets while increasing your overall sales numbers.

Serious Customers

Retail marketing is often more effective than other forms of marketing, because it brings the customer to you. Consumers who shop in a particular store are demonstrating their interest in the products and services that business sells just by their willingness to take the trouble to visit.

When you know that the consumers you are dealing with already patronize your store or at least have an interest in the product, the task of marketing further products and services to them is that much easier.

Instead of creating an initial interest in your product, retail marketing allows you to expand that initial interest into repeat sales.

Loyalty Programmes

Loyalty programs take retail marketing to the next step by combining in-store promotions with longer-term rewards that keep the customer involved now and into the future. For example, store rewards cards often provide special pricing for every item purchased and access to sales that non-members don’t enjoy.

Cardholders are also provided special coupons and discounts for the amount they spend in purchases.

This type of reward structure not only creates incentives to purchase, it increases the number of touch points between your business and its customers and manages to keep your brand at front of mind over extended periods.

Disadvantages

Unpredictable

One of the drawbacks of working in retail is that it is very unpredictable. Sales can plummet in a business overnight, which can negatively affect your job security.

If you work on commission, you might see your income decrease substantially. In some cases, the retail store might have to cut back on employees or close down because of the lack of sales. This makes the retail industry very difficult to count on.

Dealing With Customers

Although many customers will be pleasant and enjoyable to work with, you will inevitably have to deal with some who are rude and inconsiderate.

You will have to deal with these customers professionally, setting aside your personal feelings and focusing on what is best for the company. In some cases, you will be extremely busy, and you must be able to handle the pressure that customers can provide. — www.commerceedu.com/ www.retailingvswholesailing.com