RETAIL MARKETING SUB CODE : 11260E43A UNIT I

Retail is the sale of goods and services from individuals or businesses to the end-user. Retailers are part of an integrated system called the supply chain. A retailer purchases goods or products in large quantities from manufacturers directly or through a wholesale, and then sells smaller quantities to the consumer for a profit. Retailing can be done in either fixed locations like stores or markets, door-to-door or by delivery. Retailing includes subordinated services, such as delivery. The term retailer is also applied where a service provider services the needs of a large number of individuals, such as for the public. !hops may be on residential streets, streets with few or no houses or in a shopping mall. !hopping streets may be for pedestrians only. !ometimes a shopping street has a partial or full roof to protect customers from precipitation. "nline retailing, a type of electronic commerce used for business-to-consumer #$%&' transactions and mail order, are forms of non-shop retailing. Retail marketing is the range of activities undertaken by a retailer to promote awareness and sales of the company(s products. This is different from other types of marketing because of the components of the retail trade, such as selling finished goods in small quantities to the consumer or end user, usually from a fixed location. Retail marketing makes use of the common principles of the marketing mix, such as product, price, place and promotion. A study of retail marketing at university level includes effective merchandising strategies, shopping and consumer behavior, branding and advertising. Retail marketing is especially important to small retailers trying to compete against large chain stores.

P !"#$t
The cornerstone of the retail marketing definition is the product. )n the retail environment, merchandise is classified according to the category into which it falls. These categories include hard or durable goods such as appliances, furniture, electronic

goods and sports equipment* food* and soft goods or consumables. !oft goods include clothing, furnishings, cosmetics, paper goods and other items with a typical life span of three years or less. +or example, in a small business selling handmade crafts, the products would likely all fall under a single category.

Pla$e
The place where retail marketing occurs helps to define the process. A retail operation can be store-based retail or non-store, according to the )nternal Revenue !ervice(s Retail )ndustry ,andbook. -ore than ./ percent of 0.!. retail stores are small, single-store, owner-managed operations* however, these generate less than 1/ percent of sales from retail stores countrywide. A definition of retail marketing includes the places where it occurs, such as in-store, online and points of sale. This also applies to non-store operations such as retail sales taking place from the business owner2s home. Relate" Rea"i%&: )mportance of Retail -arketing

P i$e
3ricing is a ma4or aspect of any retail marketing strategy. The price of merchandise helps to define the methods of retail marketing employed, as well as the target market, store location and retail format used to sell it. 3ricing in the retail environment is based on fulfilling ob4ectives such as covering the cost of sales and overhead, and in accordance with the four basic retail pricing strategies. These are everyday low pricing, high5low pricing, competitive pricing and psychological pricing. )n a small retail business such as selling handcrafts, pricing may be based purely on the cost of sales, because overhead costs, if they exist, are minimal.

P !'!ti!%
Retail marketing relies heavily on the promotional aspect of the marketing mix, as can be seen by the number of print advertisements for consumer goods such as clothing, food and furniture. 3romotions take place in both traditional media such as television, print, outdoor billboards and radio, as well as new media such as the )nternet. The choice of promotional channels is influenced by factors such as the competitive retail environment, the profit margin on sales and the budget available for promotion purposes. The success of retail marketing is defined by the success of the business in selling its merchandise.

3romotion may be more difficult for small businesses, because of their lower advertising budgets, but social media provides a low-cost method of promotion.

T()e* !+ St! e*
6epending upon the nature of business, location of action, raw material, market place etc. !tores2 7ayout is planned. ,ence it is necessary to have a look at different types 5 classification of !tores8 There are basically two broad classes 8 ,#%$ti!%al St! e*: )t depends on the use to which the material is put 9 chemicals, tools, raw materials stores, etc. P-(*i$al St! e*: )t depends on the si:e and location 9 &entral stores, !ub-stores, Transit stores, !ite stores etc. ,#%$ti!%al St! e* $a% .e +# t-e $la**i+ie" a*: Ra/ 'ate ial* *t! e: This is where raw materials used in the factory are stored. 0sually, this is the largest kind and the location should be such that it is situated alongside a railway, canal or river. ;here the deliveries are by road, there must be adequate space for trucks to move, turn and park. )f sufficient provision is not made for quick and easy loading or unloading, heavy demurrage can result. <ot all such stores need covered sheds. +or example, an engineering company whose raw material is steel will store the steel plates in an open yard. !imilarly, a powerhouse using coal or a fertiliser plant using sulphur will store material in the open. A refinery will store its crude-oil in tanks. )n certain cases where the raw materials may be explosive dangerous or poisonous in nature, complete segregation will be necessary.

3roduction !tore8 3roduction also requires a large number of materials, generally called consumables , eye-shields, cutting oils, abrasives, gloves, aprons, 4igs, small tools etc. A store stocking such items is called a 3roduction !tore. =eneral !tore8 >arious kinds of miscellaneous items like paints, brushes, cleaning materials, wood and spirit are kept here. )n some cases where there is no 3roduction !tore, the materials mentioned in #ii' are kept in the =eneral !tore. Tools !tore8 All kinds of tools files, measuring instruments, saws, small tools like hammers, pliers, etc. or sell them as scrap. !teel scrap is usually kept separately, preferably in the open. !ome metal scrap like copper can be very costly and should, therefore, be kept safely in covered stores. !alvage !tore8 ,ere materials re4ected on the factory floor are stored either with a view to salvage them or to sell them as scrap. !teel scrap is usually kept separately, preperably in the open. !ome metal scrap like copper can be very costly and should, therefore, be kept safely in covered stores.

3acking store8 3acking materials are kept here and these include wood for making crates, cardboard cartons or bottles, as in a pharmaceutical company, or empty cylinders. !pare parts store8 These spares are usually required by -aintenance for repair or overhauling of equipment and machinery in the factory. !uch a store can also have spares and components, which

have been manufactured in plant or purchased from outside and meant for production. This is also called a finished parts store, semi-finished parts store or component store. Receipt !tore8 This is where goods are received from vendors or those cleared from the railway station, airport or the docks. The materials arriving here have to be retained until they are inspected, finally accepted and sent on to the respective places for storage, or directly to where they will be used. ?uarantine !tore8 ,ere materials received from outside awaiting inspection, and this is usually a part of the receipt store. The term quarantine is used because often inspection may not be completed in a day* e.g., a lab test may be required for specific items. )n such cases, these materials are placed in the ?uarantine !tore. +inished =oods store8 +inished products of the company meant for despatch to customers or for transfer to another stock point or distribution center are kept here. ;ork-in-progress !tore8 )n many cases a particular shops produce an item in batches, e.g., @/// units. The other shops might not be able to reach this figure or the actual quantity required might only be %//. ,ere rest of the A// units in semi-finished from are kept in the ;)3 !tore for future use. This is neither raw materials nor finished goods. )t is in an intermediate state. )n some instances the !pare 3arts !tore can also be a ;)3 !tore. !tationary store8 Beeps office stationary for issued to various departments departments of the company. $onded store8 This is a store is goods on which customs or excise duty has not been paid.

Refrigerated store8 This type of store is used for storage of perishable items like fruit, meat, chemicals, medicine, vegetable, etc. it further comprises8 &hilled space store, where the temperature can be controlled between C% + and 1/ +. +ree:e space store, where the temperature can be controlled below C% + +lammable materials store8 This is used for the storage of highly combustive material like oil, paints, etc. this store consists of separate compartments partitioned by fire walls, which is done with a view to prevent movement of flames from one area to another in the event of a fire. These fire walls will normally have a four hour fire resistance rating. The main dependence for fire protection is placed on an automatic deluge type sprinkler system connected to an adequate water supply. 6ehumidified store8 )t meets the need of materials or equipment to be stored in a moisture-free atmosphere #humidity free condition'. ;hen properly sealed and conditioned almost any type of item can be stored here efficiently. Transit !heds8 These are normally roofed sheds without any walls and open on four sides and are mainly intended to protect goods from sun and rain. "ne can find such sheds in ports, ad4acent to berthed cargo ships. They are specially adapted for the items are handling of material shipped or received by sea. ,ere the items are handled and stored in bulk quantities. )n certain cases, the +ood &orporation of )ndia stores bags of rice or wheat in such open sheds. DTransit( signifies that storage is temporary and that the goods are to be moved out soon. 6ry Tanks8

6ry tanks are used for long term storage and are constructed entirely with steel, except for a concrete floor. $ecause of the si:e and shape of dry tanks, there is no operating aisle for materials handling equipment. There is no direct access into the tanks, which are sealed after materials are stored in them. The dry tanks can be temperature controlled and dehumidified. !hed storage8 A shed is a roofed structure without complete side and end walls, and is used for the storage of materials that require maximum ventilation or those that do not require protection from weather. This type of building is a compromise between a yardstore and a closed stores building, because it offers more protection to materials than former but less than the latter. )f necessary, tarpaulins, can be used on the side for protection during the monsoon. )t is built at ground level with a concrete floor. "pen Eard8 This is used for storing bulk items, which do not require specialised storage. Fven though there is no protection from sun and rain, the surface of the open yard is normally levelled and is covered by sheets or steel mats. The organi:ation set-up of the stores will depend upon the requirements, and have to be tailor-made to meet the specific needs of an enterprise. )t may also be stated here that separate buildings are not necessary for these stores. They can all be in one building in the manner described above. The afore mentioned list is by no means complete* one can have an infinite variety. +or example, one a military establishment or a very big shipping or Airlines &ompany can have a large number of sepciali:ed types of stores. 3hysical considerations8 There can be various types of stores based on the quantity of stocks held or distance from the point of usage, like central stores sub-stores, transit stores, site store etc. &entral store8

There can be a central store serving three or four factories or several shops in a large factory or it can be a central warehouse containing finished goods. The word Dcentral( only denotes that it severs various units each of which may have separate sub-stores or departmental stores. &entral stores also exist in multi-plant situations. "ne of the problems in having a central store is the handling costs involved in transferring materials to the sub-stores or shop floor. 0sually, therefore, the central stores located at the point of greater usage. "ne of the main control factors in the establishment of a central store is to ensure that unnecessary inventories are not built up by the sub-stores, or that matter by the sub-stores and the central stores should be considered as one. !ub-store8 A sub-store is located at the place of usage. )t can be even within the shop floor

There are many different ways to shop in &anada including stores, flea markets and yard sales. !pring is the best time for flea markets and yard sales where you can get great bargains on previously owned goods #also referred to as Gused goodsH'. "ften an entire street will have a Gstreet yard sale.H Fach family will sell the things they no longer need in front of their home. !tores in &anada are grouped in malls, pla:as and in downtown areas. )n malls, stores are all in one building, often around a central courtyard. )n pla:as, stores are lined up in a row and each one is reached directly from the outdoors. $oth pla:as and malls usually have large, free parking lots. $efore the development of malls and pla:as, individual shops were located on the main streets of the city centre. These areas are still popular for their character and tradition. )n downtown areas, you may need to pay for parking* coin-

operated meters are commonly used on busy streets. &ertain stores offer free parking to customers. A department store is a retail establishment that speciali:es in selling a wide range of products. 6epartment stores usually sell products including clothing, furniture, appliances, electronics, hardware, toiletries, cosmetics, toys, and sporting goods. 6iscount department stores #sometimes called Gbig box storesH' are retail stores offering a wide range of products at discounted prices. These stores are usually large, with central checkout areas, and are often located outside cities and towns. 6iscount !tores are similar to department stores, but offer additional price savings. 6iscount stores often sell bulk goods #larger portions and quantities' and offer fewer checkout stations and customer service employees. &heck-out areas are usually located at the front of the store. !upermarkets #sometimes called grocery stores' are large, self-service stores offering a wide variety of food and household items. &onvenience stores #or variety stores' are smaller stores, often located alongside a busy road or near a service station #a roadside gas and car maintenance location'. These stores typically offer a limited range of groceries and household essentials. !pecialty stores are small stores that sell a specific type of merchandise #for example, sporting goods'. These stores typically offer lots of selection within their specialty, and also provide extensive service and support. !econd-hand stores are retail establishments that sell used goods. They are often operated by charities as a means of raising money. Their goods are often donated, and the staff may be volunteers. !ome second-hand stores are operated for profit.

 +armers markets are markets where farmers sell their produce to the public. They are usually held out-of-doors, in public spaces. !ome farmers markets have permanent locations, while others are set up only on weekends or holidays