Retail

Management
Mkt 531
• As a consumer you have already been introduced to the
concept of Retail
• Bought chips? Bought a T shirt? Bought Movie tickets?
Bought a meal at a Restaurant? You have been Retailed
• Now think about how many times in your life you went to the
store and purchased an item, any item
• What this course strives to do is explain all the key concepts
behind the scenes of managing and operating a Retail
business
• It takes a look under the hood of all the components that
come together in symphony to provide the end user a retail
experience

Retail Management
• Retail encompasses business activities involved in selling
goods and services to the end user, the final customer, for
relatively for use or consumption rather than resale .
• When we say consumption we are talking about personal
consumption not for the purpose of selling it forward
• When buying for selling purposes , rather than visit a
retailer one would visit a wholesaler or manufacturer to
get bulk items at a reduced cost to sell forward but when
you buy say a can of soda from a quick mart, you are
buying it to drink

Retail
Retailing is one of the world’s largest industries. It is in a
permanent state of change, and the pace of this change has
been accelerating over the last decade. From the marketing
perspective, retailers are, by definition, closer to the
consumer than manufacturing companies.

Retailing (the strategy of selling goods through retail) is a

set of business activities that add value to products and
services sold to the consumer.

What is Retailing?
• Retail is living and breathing and it is the one industry that is so in tuned with
the end user that it is in a constant state of innovation
• Not a day or week passes by without news of happenings in Retail
• Retail was in a state of boom in the last decade and till 5 years ago
• However in Pakistan the recession and the Pandemic worldwide has hit the
Retail industry pretty hard
• Have you noticed how many storefronts have closed up?
• Well established local brands like Ayhaniz or even International chains like
Debenheims announcing their closing
• Who here has heard of what is going on with Food Panda? Now how does
that fit into Retail
• The connect is that as we go further in roads , services like food panda are
apart of your distribution and supply chain
• And restaurants to be discussed later in this session are actually a retail format

Retail Today
• Lets shift our focus from being consumers to being
Retailers
• Retailers make complex sophisticated decisions everyday
and utilize technology to meet demands
• Selecting target markets, determining what services to
offer and products, negotiating with suppliers, motivating
sales associates and managers as well as keenly focusing
on the four ps; how to price, how and when to promote,
presentation of merchandize, etc.

Retail Management
• These decisions and how they affect retailers is very real
and based on the size of their organization as well as
available investment capital and set up determine how
they weather the competitive environment.
• You will see a lot of marketing elements that you
previously learned in the course of retail management.
These concepts are honed in on a micro level and applied.

Retail Management
• Have you heard the story of Markhor and how it
reenergized the industry in Okara?
• Shoes, crafted from leather by hand, are being
produced in Okara and picked up all around the
world.

Have you heard the

story…
• To be able to open a Retail business
• To understand the micro economic opportunities and
environment of our country
• To be able to provide expertise/consult on existing retail
businesses
• To be able to make a business plan for Retail Businesses
• To increase awareness as a consumer
• Sales associates with MNCs need to know how Retailers
work in order to get their products on their shelves

Why study retail

management?
• Shopping essentially involves 2 options
• 1. Go to the store
• 2. Buy it online
• These days more and more people are opting for the box
to be delivered at their doorstep, which is putting a
squeeze on brick and mortar retail.

Retail 2020 PreCovid

• Although stores are opening up with SOP’s in place, Retail
has now seen an increase of pick up or drive through and
curbside retail as well as online shopping. Although current
buying power is at an all time low, and brands face the very
real possibility of extinction, Retail is firmly in survivor
mode.
• The previous mandate had ensured that all sales staff and
managers of stores need to be vaccinated and carry their
certificates, new mandates have stipulated individuals
entering mall and shopping premises need to be vaccinated
too

Retail During Covid

• What does that mean for retail?
• With a substantial percentage of the populace, anti
vaxxers, this stipulation will in fact limit the flow of
traffic in these locations as they will not be able to
physically reach brick and mortar stores.
• With the popularity of online buying at a peak, you still
have individuals who like to buy things by touching and
feeling it, depending on the price and the utility of the
item
• A lot of retail businesses are also connected to other
industries that have been affected by COVID
• The biggest industry, wedding and entertainment , saw a
decline when halls were shut and although intimate
weddings still forged ahead, due to a reduced scale, saw a
reduced need for people to buy as well as minimize the
costs associated
• Flower retailers, caterers, bridal designers, formal wear
retailers, shoe retailers, jewelers, etc.. Would all be
affected by the decline in demand
• We still saw a beautiful pivot in Retail
• You had so many home cooks registering and promoting their
businesses, small scale set ups
• Online websites for traditional brick and mortar was set up
• An increase in social media utility in local retail and
communication
• Even businesses like bakeries that rely on entertaining around
eid , introduced gift baskets that would allow consumers to
embrace the spirit of giving and community in a different
manner than previously

Not as dire as it sounds

 • Every day a new retailer enters the market
• Sometimes they are just helmed by ordinary people
• What sets them apart are the following qualities:
• They love and believe in the product or the customers
they serve
• They want to be their own boss
• They are willing to take risks
• They want to contribute to their community
• They are creative or have a vision
• They aren't afraid of hard work

New Retailers enter the market

every day
• By nature, entrepreneurs are to a degree risk takers, as it is likely that
they have taken a big risk by leaving a corporate environment and a
steady salary to start their own business. The reality however is that
many entrepreneurs are more cautious and risk-averse than what is
perceived to be.
• Christo Botes, spokesperson for the Sanlam / Business Partners
Entrepreneur of the Year competition, says that the fear of failure is a
common occurrence in any entrepreneur’s journey, and that this fear can
discourage business owners from taking the essential, calculated risks
needed to further develop and expand their business.
• “Although the ability to take risk is an essential trait in an entrepreneur,
not many entrepreneurs possess the ability to do so and instead view risk
negatively, associating it with possible danger and loss. However, in the
process of doing so, they can also sabotage their own success by falling
into a comfort zone, ultimately prioritizing their fear of failure above the
search for success. This fear can inhibit a business from remaining
innovative, which is necessary in an ever changing economy faced with
differentiating consumer demands.”
Retail Evolution
The Retail Value Chain
• Although organizing a company with strict functional
departments is how the old guild works, a new age
method of adding more value to the value chain is to
create cross functional departments and hold them
accountable to “learning milestones”.

Recommendation
• A retail format represents a specific configuration of the retail
marketing mix (e.g. store size, typical location, merchandise,
price and service offered) and it often forms the core of the
retail strategy.
• For example, category killers (a large store, typically one of
a chain, which specializes in a particular type of discounted
merchandise and becomes the dominant retailer in that
category)such as Sapphire, IKEA
• Hard discounters, such as Imtiaz are certainly one of the most
aggressively growing retail formats in food retailing
worldwide

Retail Format
• Now lets Take the category killer Ikea. There’s a word of
caution here, and that’s the risk of ubiquity. There is a
backlash beginning to rise against “IKEA style” in which a
home furnished exclusively by IKEA is considered to be a
bit cheap.
• Ingvar, the founder of IKEA, developed his first business as a
boy, selling matches to neighbors from his bicycle. He found that
he could buy matches in bulk very cheaply from Stockholm, sell
them individually at a low price, and still make a good profit.
From matches, he expanded to selling fish, Christmas tree
decorations, seeds, and later ballpoint pens and pencils. When
Ingvar was 17, his father gave him a little cash for doing well at
Retail Formats
school. He used this cash to establish what has grown into IKEA.
• Early IKEA was very much about opportunist retail,
selling whatever it could, but the big growth came after
Igvar started to think systematically about selling
furniture.

Ikea
• The basic gist is Retail is a long process. What you start
with may not be what you specialize in or are recognized
for.
• Retail is like its consumer evolving and it is because it is
so connected to the user that it must strive to be ever
accepting and ready to grow and change.

Ikea