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Chapter 13:Retailing
Retailing
retailing involves the sale of products and services to end consumers for their personal non-business use
not all sales by retailers are retail sales. why? similarly, not all retailing is done by retailers most of the retailers of Canada are very small there is considerable concentration in retailing,
accounted for by the large chains many small retailers join contractual vertical
marketing systems to increase their competitiveness
Figure 13-1 Total Retail Trade in Canada, Selected Years
Physical Facilities of Retailers
most retailers operate from stores, although more now engage in nonstore retailing
those that operate stores must consider where to locate their stores, how to design them, and what physical layout to use
much retailing in Canada is concentrated in shopping centres which range in size from small neighbourhood convenience centres to very large regional centres
Forms of Retailing
most retailers are independents corporate chains are centrally owned and
managed which means that individual stores have relatively little autonomy
chains can generally offer their customers lower prices because of a lower cost structure
they spread their risk and exposure over a larger number of stores; they can experiment and gain economies of scale in advertising
however, they tend to be quite standardized
Franchising and Other VMS
retail co-operatives and voluntary chains offer retailers increased buying power and the benefits of management and marketing support
product and trade name franchising allows a retailer to use the franchisor’s trade name for promotional purposes; focus is on what is sold
in business format franchising, a firm with a track record sells the right to operate identical businesses; focus is on how the business is run
Major Types of Retailers
department stores offer a wide variety of mechandise and services and don’t compete on the basis of price; they are facing intense competition and high operating costs
discount houses are large-scale chain retailers that offer a wide range of products but less depth; they offer low prices and fewer services and have succeeded in keeping costs low through use of technology
Limited-line Retailers
limited-line retailers offer customers less selection, but great depth within their lines
specialty stores carry a very narrow product line, usually specializing in a single category
off-price retailers offer a deep assortment in a narrow line, low prices, and few services; these include factory outlets
category-killer stores offer a very wide variety and low prices; dominate the category
Other Forms of Retailing
many of the established retailers are moving toward new forms of distribution, including telephone and Internet shopping
supermarket retailing has extended with the opening of superstores and combination stores
convenience stores are open 24 hourswarehouse club chains have made a major
entry into Canada in recent years; they offer a wide breadth of products, but little depth
Nonstore Retailing there has been considerable growth in nonstore
retailing with advancing technology and changing consumer shopping preferences
direct selling avoids using intermediaries telemarketing uses sales people on the phone
to sell products and services direct marketing uses catalogues, direct mail,
television shopping, and the Internet many products and services are now sold
through vending machines
Online Retailing
more and more companies are selling directly to consumers over the Internet
those that operate only online have struggled to become profitable; those that also have a physical stores are more likely successful
shopping-cart abandonment is high; challenge to turn browsers into buyers
Retailing Management
in a competitive market, positioning of retailers is a challenge
in many retail operations, managing through seasonal and fashion cycles is necessary
through technology, retailers will have access to considerable volumes of information; improved productivity will be one result
retailers will place greater emphasis on convenience, customer service, and customer retention
Figure 13-2 Fashion-Adoption Processes