Post on 24-Dec-2015
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Retailing
• Transactions in which ultimate consumers are the buyers
• Retailers
–Organizations that purchase products for the purpose of reselling them to ultimate consumers• Retailers add value—shopping convenience,
services, and purchasing assistance to customers
• Retailers create utility—time, place, possession, and form
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Table 15.1
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General-Merchandise Retailers
• Offer a variety of product lines
• Department Stores
– Large retail organizations characterized by wide product mixes and organized into separate departments to facilitate marketing efforts and internal management
• Discount Stores
– Self-service, general merchandise stores offering brand name and private brand products at low prices
• Supermarkets
– Large, self-service stores that carry a complete line of food products, along with some nonfood products
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General-Merchandise Retailers (cont’d)
• Superstores
– Giant retail outlets that carry food and nonfood products found in supermarkets, as well as most routinely purchased consumer products
• Hypermarkets
– Stores that combine supermarket and discount shopping in one location
• Warehouse Clubs
– Large-scale, members-only establishments that combine features of cash-and-carry wholesaling with discount retailing
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General-Merchandise Retailers (cont’d)
• Warehouse Showrooms
–Retail facilities in large, low-cost buildings with large, on-premise inventories and minimal services
• Catalog Showrooms
–A form of warehouse showroom where consumers can shop from a catalog and products are stored out of buyers’ reach
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Specialty Retailers
• Traditional Specialty Retailers
–Carry a narrow product mix with deep product lines (e.g., pet supplies)
–Also called “limited-line” and “single-line” retailers
–Have higher costs and higher margins
–Provide more product selection (first-line brands), product expertise, and high levels of personal service
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Specialty Retailers (cont’d)
• Category Killers
– Concentrate on a major product category and compete on the basis of low prices and product availability
• Off-Price Retailers
– Buy manufacturers’ seconds, overruns, returns, and off-season merchandise for resale to consumers at deep discounts
– Charge less than do department stores for comparable merchandise and offer few customer services
– Have established long-term relationships with suppliers for continuing supplies of reduced-price goods
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Strategic Issues in Retailing
• Retail Store Location
–Factors affecting location• Intended target market
• Kinds of products
• Suitability of site for customer access
• Characteristics of existing retail operations
• Types of Locations
–Free-standing structures
–Shopping malls and centers
–Traditional business districts
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Types of Traditional Shopping Centers
• Neighborhood Shopping Centers
– Usually consist of several small convenience and specialty stores
• Community Shopping Centers
– Include one or more department stores (anchors), some specialty stores, and convenience stores
• Regional Shopping Centers
– Have the largest department stores, the widest product mix, and the deepest product lines of all shopping centers
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Types of Nontraditional Shopping Centers
• Factory Outlet Malls
– Shopping centers that feature discount and factory outlet stores carrying traditional brand name products
• Miniwarehouse Mall
– Loosely planned centers that lease space to retailers running retail stores out of warehouse bays
• Nonanchored Malls
– Do not have traditional department store anchors; instead combine off-price and category killer stores in a “power center” format
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Strategic Issues in Retailing
• Retail Positioning
– Identifying an unserved or underserved market segment and serving it through a strategy that distinguishes the retailer from others in the minds of consumers in that segment
• Store Image
– Atmospherics• The physical elements in a store’s design that appeal to
consumers’ emotions and encourage buying
• Interior layout, colors, furnishings, and lighting
• Exterior storefront and entrance design, display windows, and traffic congestion
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Wholesaling
• Transactions in which products are bought for resale, for making other products, or for general business operations
• Wholesaler
–An individual or organization that facilitates and expedites wholesale transactions• Handles the physical distribution
of goods
• Furnishes channel information to facilitate and manage the supply channel
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Major Wholesaling Functions
• Supply-Chain Management
• Promotion
• Warehousing, Shipping, and Product Handling
• Inventory Control and Data Processing
• Risk Taking
• Financing and Budgeting
• Marketing Research and Information Systems
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Services Provided by Wholesalers
• Serve as an extension of the producer’s sales force through contact with suppliers and retailers
• Lend financial assistance for the distribution channel
• Transport and warehouse inventories
• Assume credit risks of buyers/customers
• Purchase producers’ entire output: convert producer’s output immediately to working capital
• Channel information from and to sellers and buyers
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Types of Wholesalers
• Merchant Wholesalers
–Independently owned businesses that take title to goods, assume ownership risks, and buy and resell products to other wholesalers, business customers, or retailers• Provide market coverage
• Make sales contacts
• Store inventory
• Handle orders
• Collect market information
• Furnish customer support
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Types of Wholesalers
• Manufacturers’ Sales Branches and Offices
–Sales branches• Manufacturer-owned intermediaries that sell
products and provide support services to the manufacturer’s sales force
–Sales offices• Manufacturer-owned operations
that provide services normally associated with agents