1. THE BUSINESS OF FASHION 3.03 Identify the types of fashion retailers.
UNIT C
THE BUSINESS OF FASHION
3.03 Identify the types of fashion retailers.

2. Main types of retailers
Retailers can be classified into 1 of 2 categories, based on the merchandise the store carries.
General merchandisers
Specialized merchandisers

3. General merchandisers
Carry & market many types of goods in several price ranges
May be a rural general store or a huge mass merchandiser
Sears Product Mix:
Appliances
Fashion
Tools
Automotive & Tires
Beauty & Health
Baby
Books
Jewelry
Fitness & Sports
Lawn & Garden
Outdoor Living

4. Specialized merchandisers
Narrower lines of related merchandise
Target a more distinct group of customers
Market certain categories of goods to particular age groups, sizes, and consumer tastes and preferences
Examples: Victoria’s Secret, Footlocker, Lane Bryant

5. Even though retailers can be categorized as either general or specialized merchandisers, they can be further classified by specific types:

6. Department store retailing
Large-scale mass merchandisers
Usually carry a wide range of sizes
Carry household goods
“Departmentalized” by category/sizes of goods being sold
Each department may have separate salespeople and payment areas.
Generally known for high quality, fashion, and customer service
Usually offer credit and return or exchange privileges
Examples:

7. Department store retailing (cont.)
Offer numerous customer services such as gift wrap, layaway, and restaurant(s)
Sell to many income levels, but generally target middle to upper income customers
High operating expenses due to number of employees and customer services
Advertise heavily
Large buying and sales volume

8. Types of department stores
Branch stores
Flagship stores
Junior department stores
Chain stores

9. Branch stores
Small retail stores owned and operated by a parent store.
May be located in suburbs or other urban areas
Receive merchandise and operation instructions from the original store (or flagship store)

10. Flagship stores
“Parent” or main stores originally located in a central business district (New York City is the home office for all the Macy’s branch stores throughout the country).
Responsible for merchandising and promotion for entire operation
Can make merchandise available to branch stores on short notice
Some flagship stores have closed and moved administrative offices to other locations.

11. Junior department stores
Small department stores with limited assortments of apparel, housewares, gifts, and household textiles.
Moderately priced merchandise
Small, locally owned
Low sales volume makes it difficult for these stores to compete.

12. Chain stores
A group of stores (usually 12 or more) owned, managed, merchandised, and controlled by a central office.
All stores carry similar goods at similar prices.
Prices in chain stores are often lower than department stores.
Private label merchandise (Example: Kenmore for Sears)
Decisions made at central headquarters
Merchandise can be produced to the chain’s specifications
Chains can be general or specialized
May serve as anchor stores
Anchor stores: The attractions that draw customers to shopping centers and malls.

13. Discount store retailing
Discount stores: Mass merchandisers that sell at lower-than-average prices.
Located in large, no-frills facilities in high traffic areas
Offer minimal customer services
Merchandise is paid for at checkout counters located near store exits.
High sales volume, shown strongest growth in market share
Fashion followers
Many retailers are making an effort to offer more current fashions.
Most discounters are chains.

14. Discount store retailing (cont.)
Extended operating hours
Many imports from low-wage countries
Appeal to customers with modest clothing budgets
Other Types of Discount Stores
Off-price discounters
Factory outlets

15. Off-price discounters
Retailers that sell brand name or designer merchandise at lower-than-normal prices.
High fashion goods at moderate prices
Changing and unstable collection of merchandise
Buy merchandise at below-wholesale prices
Labels may be cut out to protect merchandise sold in upscale shops

16. Off-price discounters (cont.)
Do not place advance orders
Make low-cost special purchases during the season when other stores are planning for the next season
Stock consists of production overruns, end-of-season goods, closeouts, and irregulars.

17. Factory outlets Sell only merchandise produced by the company
Discount stores that are manufacturer owned and operated
Sell only merchandise produced by the company
Products sold include overruns, canceled orders, and discontinued items.
May be located in factory malls

18. Wholesale Warehouse Clubs
Specialize in bulk sales of a limited selection of nationally branded staple merchandise
Offer almost no services, no shopping bags, no home delivery, limited payment options
Most charge an annual membership fee
Merchandise is bought with volume discount and stacked high in packing cartons
Almost no advertising or promotion is done

19. Hypermarkets Huge “supercenters”
Function as a combination grocery and discount store
Target time-stressed consumers who want to do all of their shopping in 1 place
The concept, which started in Europe, also features a very high volume of sales at low prices

20. Specialty store retailing
Specialty stores: Retailers that sell limited classifications of merchandise. Ex: maternity shops, shoe stores, bridal boutiques, children’s apparel, accessory shops
Many specialty stores are now franchise stores or national chains with well-known retail names.
Boutiques
Low sales volume
High prices
Offer unusual merchandise, more personalized service, convenience, and ambience
Known for a certain level of design or quality of merchandise

21. Franchise stores
Retail establishments in which a firm or an individual buys the right to use a famous or established name or trademark in a specified trading area.

22. Franchise stores (cont.)
Often located in exclusive shopping areas of major cities or boutique areas within large department stores
The designer or manufacturer does not have direct ownership of the franchise and does not help run the business. They only supply goods to the retailer.

23. Boutiques
Small, stand-alone shops or areas within larger stores that sell unusual, limited quantity apparel, accessories, or decorative items.

24. Boutiques (cont.) High level of customer service
Fashion-forward merchandise
Target special-interest customers
Unique images
New, artistic, and handmade items

25. *Nonstore retailing developed for the convenience of
Selling without a conventional store facility.
Mail-order retailing
Telecommunication retailing
In-home selling
*Nonstore retailing developed for the convenience of
the consumer.

26. Mail-order retailing
Selling merchandise through catalogs distributed to customers.
Customers select items by looking at pictures and reading product descriptions.
An alternative for customers who prefer to shop from the comfort of their home or cannot go out to shop
Orders are placed by mail, toll-free calls, computer.

27. Mail-order retailing (cont.)
Merchandise is usually paid for by credit card and shipped directly to consumer.
Extended order-taking hours
May offer a full line of items or specialize in a single line of merchandise
Many retail department stores and chains offer catalog shopping.
Many mail-order houses also have retail stores.
Customers usually pay high shipping and handling fees.

28. Telecommunication retailing
Selling merchandise using communication devices.
Television retailing
Computer (Internet) retailing

29. Television retailing
Television channels are used to show and describe merchandise.
Many celebrities sell signature lines of merchandise.
Consumers can control what they view.
Orders are placed by telephone or online at the company website.
Used to introduce and test the market for new products
Reaches a national audience

30. Computer (Internet) retailing
Electronic retailing or “e-tailing”
Combines computer and telephone technologies with marketing and merchandising
Shoppers view merchandise on computer monitors and order through a modem connection.
Allows customers to view “electronic catalogs”
Allows for comparison shopping

31. In-home selling Selling outside of a retail store
Used to sell cosmetics, jewelry, clothing lines, and other merchandise through selling parties or door-to-door sales
Merchandise is often high quality and unusual in design.
Prices may be high.