Retail Store & Location

Unit 4 Retail Store & Location

Types of Retail Location, Step involved in choosing a Retail Location. Merchandising, Basis of retail merchandising, Factors affecting the Merchandising functions, The Merchandises Role & Responsibilities. Visual Merchandising

Introduction
Define Store: A store is place , real or virtual , where the shoppers comes to buy goods & services. The sales transaction occurs at this junction. The location of retail store has for along time been considered the most important P in retailing.

Locating the retail store in the right place was considered to be adequate for success.

 Location becomes a critical decision for a retailer for several reasons. As like;
Location is generally one of the most important factors customers consider while choosing a store. A bad location may cause a retailer to fail even if its strategic mix is excellent.. On the other hand , a good location may help a retailer succeed even if its strategic mix is mediocre. Store location is least flexible element of retailers strategic mix due to its fixed nature, the amount of investment, and the length of lease agreements

Types of Retail Location

Various option are available to the retailer for choosing the location of store. The choice of the location of the store depends on the target audience and the kind of merchandise to be sold. A retailer has to choosing among alternate types of retail locations available . It may locate in an isolated place and pull the customer to the store on its own strength, such as a small grocery store or paan shop in a colony which attracts the customers staying close by

Typically a store location may be:

1. 2. Freestanding /Isolated store. Part of Business District/Centers (unplanned Business Districts).

3.

Part of a Shopping Center (Planned Shopping Centers)

1.

Freestanding /Isolated store

Where there are no other outlets in the vicinity of the store and therefore store depends on its own pulling power and promotion to attracts customers. A biggest advantages for freestanding stores is that there is no competition around. This type of location has several advantages including no competition, low rent, often better visibility from the road, easy parking and lower property . Neighborhood Stores; colony shops serves small locality. Highway Stores :Ebony store in Ludhiana .

Business Associated Location: These are location where a group of retail outlets offering a variety of merchandise work together to attract customers to their retail area, but also compete against each other for the same customers.two types includes in ; 1. Part of Business District/Centers (unplanned Business Districts).

2.

Part of a Shopping Center (Planned Shopping Centers)

2.

Part of Business District/Centers (unplanned Business Districts).

A retail store can also be located as a part of a business district. Or we can refer this as unplanned business centers A business district is place of commerce in a city which developed historically as the center of trade and commerce in the city or town. A business districts can be a central, secondary or a Neighborhood business district. A Central business District CBD is the main center of commerce and trade in the city. (high land rates , intense development)

 A CBD is the hub of retailing activity in a city. CBD served different sections of population for Examples of Cannaught place in Delhi, Colaba in Mumbai, Commercial Street and in Bangalore are up market CBDs. CBDs serving the upper and upper middle class customers across these cities like, chandani chowk in Delhi, KalbadeviBhuleswar in Mumbai, Chickpet in Bangalore.

Secondary Business District are composed of unplanned cluster of store often located on a major intersection of city they a customers from a large part of the city

3.

Part of a Shopping Center (Planned Shopping Centers)

A shopping center has been defined as a group of retail and other commercial establishments that is planned , developed, owned and managed as a single property The basic configuration of a shopping centre is a Mall or Strip centre. A mall is typically enclosed and climate controlled. A walkway is provided in front of the stores. A strip centre is a row of stores with parking provided in the front of the stores.

 In India we can planned shopping centre can categorize in two category Regional shopping centers or Mall: Regional shopping centers or mall are the largest planned shopping centers.. Often they are anchored by two or more major department stores have enclosed mall serve a large trading area and have high rents. (ansal plaza,spencers plaza crossroads, DLF city in Gurgaon)
Neighborhood/community/shopping centers: Neighborhood /community centers usually have a balanced mix of stores including a few grocery stores , a chemist, a verity store and a few other stores selling convenience goods to the residents of the neighborhood.

Step involved in choosing a Retail Location 1. 2. In order to arrive at the decision on where to locate the retail store a retailer needs to first on the region that he wants to locate the store. After identifying the region the following steps Have to be followed . Identifying the market in which to locate the store. Evaluate the demand and supply within that market. i.e. determine the market potential.

3.
4.

Identify the most attractive sites

Select the best site available

1.
2.

Market Identification: The first step in arriving at a decision on retail location is to identify the market attractiveness to a retailer. This is important that retail needs to understand the market well. Determining the market Potential:: The retailer need to take into consideration various elements as shown in format. (features of population) Demographic features of the population The characteristics of the household in the area (average household income) Competition and compatibility (Need to know compatibility & competition in market) Laws & regulations:( good understanding of the laws

Determining the market Potential

Demographics of population & area

Competition

Trade area analysis

Laws & Regulation

 Trade area analysis: A trade area is the geographic area that generates the majority of the customers for the store.
Primary trade area: primary trading covers between 50-80% of the stores customers.

Secondary Trading Area: this area contains the additional 15to 25% of the stores customers.
Tertiary trading area covers the balance customers These trading areas are dependent on distance and do not always have to be concentric in nature

Types of Trades areas.

3 & 4 Identify Alternate sites and select the site: After taking decision on the location and market potential the retailer has to select the site to locate the store based on these Traffic Accessibility of the market is also a key factor The total number of stores and the type of store that exist in the area Amenities To buy or to lease The product mix to be offered by the retailer

Merchandising, Basis of retail merchandising,

Product and merchandising management is key activity in the management of retail business. The primary function of the retailing Is to sell Merchandise. One of the most strategic aspects of the retail business is to decide the merchandise mix and quantity to be purchased .

Merchandising can be termed as the planning, buying and the selling of merchandising .

 Define Merchandising as The analysis, planning, acquisition, handling and control of merchandise investments of a retail operation. Merchandising is the core of retailing.

The function of merchandising is an integral part of retailing and also one of the most challenging functions.
AMA define The planning involved in marketing the right merchandise at the right place at the right time in the right quantities at the right price.

 Achieving these five Right is the key to successful merchandising and many a times, this remains an elusive goal for most retailers. Merchandising management can be termed as Planning, analysis, acquisition, handling and control of the merchandise

 Analysis: because retailers must be able to correctly identify their customers before they can ascertain consumer desires and their needs/requirements for making a good buying decision. Planning is important because merchandise to be sold in the future must be bought now. Acquisitions because the merchandise needs to be procured from others, either distributors or manufactures. Handling involves seeing that the merchandise is where it is needed and in the proper condition to be sold. Control is required since the function of merchandise involves spending money for acquiring products it is necessary to control the amount of money spent on buying

Factors Affecting the Merchandising Function

Merchandising does not function in isolation. It is affected by various factors like the organization structure, the size of the retail organization and the merchandise to be carried.

Rarely are any two stores organized in the same way.

The function of the merchandising is vary from one organization to another. Size: The needs of the individual retailers vary from those of large chain store operation.

Size of organisation
Merchandise to be carried Organisation Structure

Merchandising function

Types of store

 The merchandiser to be carried by a retailer largely determines the responsibilities of the merchandiser.

Merchandise to be carried: The buying for basic merchandise is fairly different from buying fashion merchandise. A merchandisers who I handling fashion products will need to spend more time in the market, and looking for the products which is more suitable for the customers.
Organization structure that the retail organization adopts also affects the merchandising function. Some organization may differentiate the role of the buyer and the role of a merchandisers separately.

The Merchandises Role & Responsibilities

Planning: Thought the merchandising may not be directly involved in the actual purchase of merchandise. They formulate the policies for the areas in which they are responsible. Forecasting sale for the forth coming budget period and can estimate the consumer demand and the impact of changes in the retail environment. Directing: Guiding and training buyers as and when the need arises, is also a function of the merchandiser. The buyers have to be guided to take additional markdowns for products which may not be doing too well in the stores.

 Co-ordinating: Merchandise managers supervise the work of more than one buyer. They need to coordinate the buying effort in terms of how well it fits in with the store image and with the other products being bought by other buyers.
Controlling: assessing the buyers performance , is a also part of the merchandise managers Job. This includes evaluated on the basis of net sale, maintain mark up percentage, gross margin % and stock turn

Role of the Buyer

Buyers plays an important role in the retail industry. they select and order merchandise to be sold. Buyers may be responsible for buying for a department, an entire store, or a chain of stores

1. 2. 3. 4. 5.

Developing the merchandising strategies for the product line Planning and selecting merchandise assortments Vendor Selection Pricing of the merchandise Inventory Management

Retail Store Design & Visual Merchandising

Store design and layout tells a customer what the store is all about and it is very strong tool in the hands of the retailer for communicating and creating the image of the store in the mind of the customers.

The design and layout of the store are a means of communicating the image of the retail store.
The environment which is creates in the retail store, is a combination of the exterior look of the store, the store interiors, the atmosphere in the store and the events, promotions and the themes.

 The overall look of a store and the series of mental pictures and feelings it evokes within the beholder. For the retailer, developing a powerful image provides the opportunity to embody a single message, stand out from the competition and be remembered.

Elements of store design

Frontage & Entrance

Ext.
Display

Parking

space
Building architecture

Location

Health & Safety

Store design
Store theme
Target Customers

Access

Merchand ise Mix

Exterior Store Design & Interior Design

Exterior Location Parking Ease of access The building architecture Health and safety standards Store windows, lighting Interior Fixtures Flooring & Ceilings Lighting Graphics & Signages Atmospherics

Visual merchandising Can be termed as the orderly, systematic, logical and intelligent way of putting stock on the floor
VM is the art of presentation, which puts the merchandise in focus. It educates the customers, creates desire and finally augments the selling process.

METHODS OF DISPLAYS Color Dominance Co-ordinated Presentation Presentation by price