Presentation on theme: "An Introduction to Retailing"— Presentation transcript:
1 An Introduction to Retailing Chapter 1An Introduction to RetailingRETAILMANAGEMENT:A STRATEGICAPPROACH,10th EditionBERMAN EVANS
2 Chapter ObjectivesTo define retailing, consider it from different perspectives, demonstrate its impact, and note its special characteristicsTo introduce the concept of strategic planning and apply itTo show why the retailing concept is the foundation of a successful business, with an emphasis on the total retail experience, customer service, and relationship retailingTo indicate the focus and format of the text
3 RetailingRetailing encompasses the business activities involved in selling goods and services to consumers for their personal, family, or household use. It includes every sale to the final consumer.
4 Issues in RetailingHow can we best serve our customers while earning a fair profit?How can we stand out in a highly competitive environment where consumers have so many choices?How can we grow our business, while retaining a core of loyal customers?
5 The PhilosophyRetailers can best address these questions by fully understanding and applying the basic principles of retailing, as well as the elements in a well-structured, systematic, and focused retail strategy.
8 An Ideal Candidate for a Retailing Career Be a people personBe flexibleBe decisiveHave analytical skillsHave stamina
9 Table 1-1: The 10 Largest Retailers in the United States RankCompanyMain Emphasis1Wal-MartFull-line discount stores, supercenters, membership clubs2Home DepotHome centers, design centers3KrogerSupermarkets, convenience stores, jewelry stores4TargetFull-line discount stores, supercenters5CostcoMembership clubs6Albertson’sSupermarkets, drugstores7WalgreensDrugstores8Lowe’sHome centers9SearsDepartment stores, specialty stores10SafewaySupermarkets
10 Figure 1-4: A Typical Channel of Distribution RetailerManufacturerWholesalerFinalConsumer
11 Figure 1-5: The Retailer’s Role in the Sorting Process
12 Multi-Channel Retailing A retailer sells to consumers through multiple retail formatsWeb sitesPhysical stores
13 Figure 1-6: Brooks Brothers and Multi-Channel Retailing
14 Relationship Management Among Retailers and Suppliers Disagreements may occur:control over channelprofit allocationnumber of competing retailersproduct displayspromotional supportpayment termsoperating flexibility
15 Distribution TypesExclusive: suppliers make agreements with one or few retailers that designate the latter as the only ones in a specified geographic area to carry certain brands or productsIntensive: suppliers sell through as many retailers as possibleSelective: suppliers sell through a moderate number of retailers
17 Figure 1-8: Special Characteristics Affecting Retailers SmallAverageSaleImpulsePurchaseRetailer’sStrategyPopularityofStores
18 Retail Strategy An overall plan for guiding a retail firm Influences the firm’s business activitiesInfluences the firm’s response to market forces
19 Six Steps in Strategic Planning 1. Define the type of business2. Set long-run and short-run objectives3. Determine the customer market4. Devise an overall, long-run plan5. Implement an integrated strategy6. Evaluate and correct
21 Aspects of Target’s Strategy Growth objectivesAppeal to a prime marketDistinctive imageFocusCustomer serviceMultiple points of contactEmployee relationsInnovationCommitment to technologyCommunity involvementMonitoring performance
24 Customer ServiceActivities undertaken by a retailer in conjunction with the basic goods and services it sellsStore hoursParkingShopper-friendlinessCredit acceptanceSalespeople
25 Figure 1-12: A Customer Respect Checklist Do we trust our customers?Do we stand behind what we sell?Is keeping commitments to customers important to our company?Do we value customer time?Do we communicate with customers respectfully?Do we treat all customers with respect?Do we thank customers for their business?Do we respect employees?
26 Relationship Retailing Seek to establish and maintain long-term bonds with customers, rather than act as if each sales transaction is a completely new encounterConcentrate on the total retail experienceMonitor satisfactionStay in touch with customers
27 Effective Relationship Retailing Use a win-win approachIt is harder to get new customers than to keep existing ones happyDevelop a customer databaseOngoing customer contact is improved with information on people’s attributes and shopping behavior
28 Approaches to the Study of Retailing InstitutionalFunctionalStrategic
29 Parts of Retail Management: A Strategic Approach Building relationships and strategic planningRetailing institutionsConsumer behavior and information gatheringElements of retailing strategyIntegrating, analyzing, and improving retail strategy