2. What is retailing?
Retailing: a conclusive set of activities or steps used
to sell a product or a service to consumers for their
personal or family use
Retailer: a person, agent, agency, company or
organization instrumental in reaching the goods,
merchandise, or services to the ultimate consumer
Countries that have enjoyed the greatest economic
and social progress have been those with a strong
retail sector
Over the last decade there have been sweeping
changes in the general retailing business
3. Retail industry and economy
Retail business is the largest private industry
Retail is ahead of finance and engineering and
contributes over 8 per cent of GDP in the western
countries
Over 50 of the Fortune 500 and about 25 of the
Asian Top 200 companies are retailers
Today, in some developed countries, retail
businesses have shares as large as 40 per cent of
the market
The significance of the retail business has increased
with the fast growth in the service sector
4. Retail industry in India
Retail forecasts in India:
- the business in India is expected to reach Rs. 25,000
billion in 2008
- growth of organized retailing in both food and non-
food
segments
- proportion of sales through organized retailing
estimated,
increase by 8% in 2010
Emergence of organized retailing:
-India to have over 700 shopping malls by 2015
(400 operational malls in 2010)
- land developers rushing to cash in on the booming
retail
5. Characteristics of retailing
Direct end-user interaction
Sole point in the value chain to provide platform for
promotions
Sales at the retail level is generally in smaller unit sizes
Location is a critical factor for retail business
Retail services are as important as core products
A larger number of retail units as compared to other
members present in the value chain
6. Functions of retailing
Sorting
Breaking bulk
Holding stock
Additional services
Channel of communication
Transport and advertising functions
7. Activities performed by retailers
Arrange for assortment of offerings
Breaking quantity
Holding stock
Extending services
9. Trends in retail formats
Mom and Pop Stores and traditional kirana stores
E-commerce
Department Stores
Discount Stores
Category Killers
Specialty Stores
E-tailers
10. Relationships between retailers and
suppliers
The retail sector is critically dependent on its suppliers
for effective operation and the profitability of its
business
Several socio-economic and demographic factors are
considered by manufacturers for identifying the ideal
retail format mix for its products
This is illustrated by the washing soap category in India
and the resultant retail format preferences
11. Retail format mix adopted by
manufacturers for soaps
Soap is targeted towards women as they are the chief
decision-makers in soap purchase. Medicated positioning
like germ killing and anti-bacterial are marketed to families.
About 75% of the soaps are bought through these following
types of outlets.
Kirana stores
Pan-beedi shops
Department stores
12. Retail strategy
Define the business of the firm in terms of orientation
towards a particular sector
Set short-term and long-term objectives with regard to
image and profitability
Identify the target market and direct efforts on the basis
of the customers characteristics and needs
Decide the broad direction the company must take in
future
Implement an integrated plan that encompasses all
aspects of retailing like pricing, location, and channel
decisions
Evaluate and revise the plan depending on the nature of
the internal and external environment
13. Retail concepts
An essential part of the retailing strategy, the retailing
concept is essentially a customer-centred, company-wide
approach to developing and implementing a marketing
strategy. The retailing concept covers four broad areas:
• Customer orientation
• Goal orientation
• Value driven approach
• Coordinated effort
14. The changing face of retailing
Role of the Internet
- Does the size of the retail organization play a big part in
adapting easily to the Internet?
- Is the product/service offering also a prime determinant
of cyber retailing?
Branding through retailers
- How do retailers choose which brands to display?
- Why do many new products fail in the marketplace
- How can manufacturers maximize the brand opportunity
in a given retail outlet?
- What is future of Lifestyle Clustering?
- Vertical retail concepts are increasing in popularity
Consumption related mega trends
15. Drivers of success in the retail
sector
Customers are the driving force in change
Re-evaluating the marketing plan
Advanced education for retailers is critical for growth
Strong visual recognition
The workplace challenge
Planning for success
