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Project Report on Retail

Project Report on Retail

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Published by Chandra Sekar K P

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Published by: Chandra Sekar K P on Mar 14, 2011
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06/17/2011

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1. RETAIL CONCEPT
The distribution of consumer products begins with the producer and ends at theultimate consumer. Between the producer and the consumer there is a middleman---theretailer,
who links the producers and the ultimate consumers.
Retailing is defined as aconclusive set of activities or steps used to sell a product or a service to consumers for their personal or family use. It is responsible for matching individual demands of theconsumer with supplies of all the manufacturers. The word ‘retail’ is derived from theFrench work 
retailer 
, meaning ‘to cut a piece off’ or ‘to break bulk’.A retailer is a person, agent, agency, company, or organization which isinstrumental in reaching the goods, merchandise, or services to the ultimate consumer.Retailers perform specific activities such as anticipating customer’s wants, developingassortments of products, acquiring market information, and financing. A commonassumption is that retailing involves only the sale of products in stores. However, it alsoincludes the sale of services like those offered at a restaurant, parlour, or by car rentalagencies. The selling need not necessarily take place through a store. Retailingencompasses selling through the mail, the Internet, door-to-door visits---any channel thatcould be used to approach the consumer. When manufacturers like Dell computers selldirectly to the consumer, they also perform the retailing function.Retailing has become such an intrinsic part of our everyday lives that it is oftentaken for granted. The nations that have enjoyed the greatest economic and socialprogress have been those with a strong retail sector. Why has retailing become such apopular method of conducting business? The answer lies in the benefits a vibrant retailingsector has to offeran easier access to a variety of products, freedom of choice andhigher levels of customer service.As we all know, the ease of entry into retail business results in fierce competitionand better value for customer.
To enter retailing is easy and to fail is even easier
.Therefore, in order to survive in retailing, a firm must do a satisfactory job in its primary
 
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role i.e., catering to customers. Retailers’ cost and profit vary depending on their type of operation and major product line. Their profit is usually a small fraction of sales and isgenerally about 9-10%. Retail stores of different sizes face distinct challenges and their sales volume influences business opportunities, merchandise purchase policies, nature or promotion and expense control measures.Over the last decade there have been sweeping changes in the general retailingbusiness. For instance, what was once a strictly made-to-order market for clothing hasnow changed into a ready-to-wear market. Flipping through a catalogue, picking the rightcolour, size, and type of clothing a person wanted to purchase and then waiting to have itsewn and shipped was the standard practice in the earlier days. By the turn of the centurysome retailers set up a storefront where people could browse, while new pieces werebeing sewn or customized in the back rooms. Almost all retail businesses have undergonea similar transition over the years.
 
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CHARACTERISTICS OF RETAILING
Retailing can be distinguished in various ways from other businesses such asmanufacturing. Retailing differs from manufacturing in the following ways:
There is direct end-user interaction in retailing.
In is the only point in the value chain to provide a platform for promotions.
Sales at the retail level are generally in smaller unit sizes.
Location is a critical factor in retail business.
In most retail businesses services are as important as core products.
There are a larger number of retail units compared to other members of the valuechain. This occurs primarily to meet the requirements of geographical coverageand population density.
Direct Interaction with Customers
Retail businesses have a direct interaction with end-users of goods or services in thevalue chain. They act as intermediaries between end-users and suppliers such aswholesalers or manufacturers. Therefore, they are in a position to effectivelycommunicate the response and changing preferences of the consumers to the suppliers or sales persons of the company. This helps the manufacturers and markets to redefine their product and change the components of its marketing strategy accordingly. Manufacturersrequire a strong retail network both for reach of the product and to obtain a powerfulplatform for promotions and point-of-purchase advertising. Realizing the importance of retailing in the entire value chain, many manufacturers have entered into retail businessby setting up exclusive stores for their brands. This has not only provided direct contactwith customers, but has also acted as advertisement for the companies and has provided

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