CHAPTER 3


CHANNEL INSTITUTION:
RETAILING
 Introduction

Retailer is the person or institution who delivers
goods to final consumer in the channel of
distribution.
Goods and services are created for consumption
and use by people, it is retailer who assumes the
role of taking the goods to its final destiny of
consumption.
The word retail is derived from the French word
retailer, that is to cut a piece, a break down.
 Introduction cont.

A retailer is a person, agent, agency, company,
or organization, which is instrumental in reaching
the goods, merchandise, or services to the ultimate
consumer.
Retailers perform specific activities, such as
anticipating customers’ wants, developing
assortments of products, acquiring market
information, and financing.
 Retail Relationship

In order to consistently deliver a value proposition to
consumers, a retailers tries to make sure of the
following:
 Customer delivered value should be what the
customer thinks is right
 The value delivery has to be consistent.
 The retailers should have a system in place to
measure customer satisfaction
The Retailer as a Salesman

A retail salesperson is someone who
sells products directly to consumers, such
as beauty supplies, clothing, electronics
or cars. They should not be confused
with sales representatives, who are
people that represent and sell wholesale
and manufacturing products.
Characteristics of Retailing

 In the entire distribution chain, a retailer is
considered to be the final link, who deals
directly with the customer.
 A retailer purchases in bulk from the
wholesalers and sells the products to the
customers in small quantities.
 A retailer essentially maintains a variety of
merchandise.
 Types of Retailing

Specialty store
are retail businesses that
focus on specific product
categories, such as office
supplies, men's or
women's clothing.
 Types of Retailing cont.

Department store
retail establishment that
sells a wide variety of goods.
These usually include ready-
to-wear apparel and
accessories for adults and
children, yard goods and
household textiles, small
household wares, furniture,
electrical appliances and
accessories, and, often, food.
 Types of Retailing cont.

Convenience store
a convenience
store, convenience shop, or
corner store is a
small retail business that
stocks a range of everyday
items such as coffee, groceries,
snack foods, confectionery, soft
drinks, tobacco products, over-
the-counter drugs, toiletries,
newspapers, and magazines.
 Types of Retailing cont.

Discount store
A discount store is a
retail store that sells
products at lower prices
than most of the other
retail stores.
 The Global Retailing Scene

The retail sector is considered as part of the service
sector an in countries where organized retail is strong
the contribution of the sector to the GDP is very high.
At the same time, the employment potential of the retail
sector is high.
One can deduce from this that the retail sector plays
a major role on the growth of the economy of any
country. Globally, organized retail is becoming
powerful over its supplier and the producers of goods
are taking action to protects their track.
 The Role of Retailer

1. They provide outlets
for products from
manufacturers.

This stock needs to go

 The Role of Retailer cont.

2. Retailers are located in
areas convenient for
All of this for a
consumers box juice
 The Role of Retailer cont.

3. Hold stocks of goods
to meet consumer
demand
 The Role of Retailer cont.

4. They provide advice
and after sales services
to consumers.
 The Role of Retailer cont.

5. Provide useful
feedback from consumers
to wholesalers or
manufacturers
 The Role of Retailer cont.

6. They make goods and
services available to
consumers in quantities
that they prefer
But I only want a
2 sacks of rice.
 Retail Strategy

Retail strategy is a marketing plan that details
how a business intends to offer its products or
services to consumers and influence their purchases.
For example, a typical retail strategy might
illustrate how best to place and display a company’s
products in retail outlets, how to attract optimal
consumer interest at those locations with such things
as price discounts, retailer incentives and signs.
Aspects of Retail Store Design

Retail store design is a branch of
marketing and considered part of the
overall brand of the store. Retail store
design factors into window displays,
furnishings, lighting, flooring, music and
store layout to create a brand or specific
appeal.
 Retail Store Design Element
1. LAYOUT

3. FEATURE AREAS
1.1 Grid Layout 3.1 Windows
1.2 Racetrack Layout 3.2 Entrances
(also known as Loop) 3. 3 Freestanding Displays
1.3 Free-Form Layout 3.4 End Caps
(also known as Boutique 3.5 Promotional Aisle or Area
Layout)
3.6 Walls
2. SIGNAGE & GRAPHICS
3.7 Dressing Rooms
2.1 Category Signage
3. 8 Cash Wraps
2.2 Promotional Signage
2. 3 Point-of-sale Signage
 Retail Store Design Element-
LAYOUT

1.1 Grid Layout
 Has parallel aisles with
merchandise on shelves on
both sides of the aisles.
 Most supermarkets and full-
line discount stores use the
grid layout.
 The use of high shelves for
merchandise enables more
merchandise to be on the
sales floor compared with
other layouts.
 Retail Store Design Element-Layout
cont.

1.2 Racetrack Layout (also known as Loop)
 Provides a major aisle that loops around the store to guide
customer traffic around different departments within the
store.
 Facilitates the goal of getting customers to see the
merchandise available in multiple departments and thus
encourages unplanned purchasing.
 Retail Store Design Element-Layout

1.3 Free-Form Layout (also known as Boutique Layout)
 This layout reduces the amount of merchandise than can
be displayed
 Provides an intimate, relaxing environment that facilitates
shopping and browsing. However, creating this pleasing
shopping environment is costly.
 Because there is no well-defined traffic pattern here,
customers are not naturally drawn around the store. Thus
personal selling becomes more important to encourage
customers to explore merchandise offered in the store.
 Retail Store Design Element-
SIGNAGE & GRAPHICS

2.1 Category Signage
 Used within a particular
department or sector of
the store, category signs
are usually smaller than
directional signs. Their
purpose is to identify
types of products offered;
they are usually located
near the goods to which
they refer.
 Retail Store Design Element-
SIGNAGE & GRAPHICS

2.2 Promotional Signage
 Describe special offers
and may be displayed in
windows to entice the
customer into the store.
For instance, apparel
stores for young women
often display large posters
in their windows of
models wearing the items
on special offer.
 Retail Store Design Element-
SIGNAGE & GRAPHICS

2.3 Point-of-sale Signage
 Point-of-sale signs are
placed near the
merchandise they refer to
so that customers know
its price and other
detailed information.
Some of this information
may already be on
product labels or
packaging.
 Retail Store Design Element-
FEATURE AREAS

3.1 Windows
 Window displays draw
customers into the store and
provide a visual message about
the type of merchandise offered
in the store and the type of
image the store wants to
portray.
 Storefront window displays are
an effective tool for building the
store image, particularly with
new customers who are
unfamiliar with the store.
 Retail Store Design Element-
FEATURE AREAS

3.2 Entrances
 The first impression
caused by the entry
area affects the
customer’s image of
the store.
 Retail Store Design Element-
FEATURE AREAS

3.3 Freestanding
Displays
 Mannequins that are
located on aisles and
designed to attract
customers’ attention
and bring them into a
department in stores
using a racetrack or
free-form layout.
 Retail Store Design Element-
FEATURE AREAS

3.4 End Caps
 Displays located at the
end of an aisle in stores
using a grid layout.
Due to the high
visibility of end caps,
sales of a product
increase when that
merchandise is featured
on an end cap.
 Retail Store Design Element-
FEATURE AREAS

3.5 Promotional Aisle or
Area
 Space used to display
merchandise that is
being promoted. The
products change each
week and are
highlighted in weekly
ads.
 Retail Store Design Element-
FEATURE AREAS

3.6 Walls
 Because retail floor
space is often limited,
many retailers increase
their ability to store
extra stock, display
merchandise, and
creatively present a
message by utilizing
wall space.
 Retail Store Design Element-
FEATURE AREAS

3.7 Dressing Rooms
 Large, clean, and
comfortable dressing
rooms put customers
in the mood to buy
merchandise.
 Retail Store Design Element-
FEATURE AREAS

3.8 Cash Wraps
 Also known as point-
of-purchase (POP)
counters or checkout
areas, are places in the
store where customers
can purchase
merchandise.
 Franchising and E-tailing

Franchising
 Franchisor is the firm which wants to sell its goods
or services
 Franchisee is the firm or group that are willing to sell
the products or services on behalf of the franchisor
 The first party gives advice and help to the second
to find good locations, blue prints for a store,
financial, marketing and management assistance
 Franchising and E-tailing cont.

Retailing on the Internet
 Unlimited assortment
 Items may not be on hold – someone has to deliver the
product – delays
 No product touch or feel
 More info makes the customer a better shopper
 Comparison shopping possible
 Consumer has to plan purchases ahead
 No need to handle cash – payment can be on-line
 Shopping is 24X7
 Franchising and E-tailing cont.

E-tailing Issues
 Payment gateway
 Customer product returns
 Wrong item delivered
 Item is not working
 Long process of delivering
 High price of delivery fee
Thank you!!!   