Chapter

2, Problem 2DQP Show all steps :

ON

Problem

Step-by-step solution

Step 1 of 2

Retailer refers to a business through which the end customers purchase goods. An
independent retailer has its own store and is responsible for its own business. A
retail chain refers to a firm that operates multiple retail stores in different locations
under the same name and have centralized decision making for the operations and
strategy of the firm.

Step 2 of 2

A corporate chain can provide merchandise at very low prices than an independent
retailer because the corporate can buy that merchandise from the supplier at a very
low cost as they buy in very large quantities to fulfil the needs of their chain stores.
Independent retailers buy limited merchandise which increases the costs.

The drawback of having a retail chain is that the all the stores carry almost the
same assortment of products irrespective of where they are located. Independent
retailers can take advantage of this opportunity by customizing their offerings
according to local needs.

Also, corporate chains tend to be more bureaucratic because of the centralized

decision-making. The management introduces various rules and procedures for the
stores so that the customer service is consistent throughout the chain. Independent
retailers can tailor their service and change their roles and procedures aligning
with the dynamic environment to better serve the customers.

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