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An Overview of Strategic Retail Management

An Overview of Strategic Retail Management. B.R.M.RAO BCom, BA, LLB, PGDCRS, PGDPA, PGDBA,PGDRDM,MIMA. Introduction to retailing. Retailing. Retailing encompasses the business activities involved in selling goods and services to consumers for their personal, family or household use.

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An Overview of Strategic Retail Management

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  1. An Overview of Strategic Retail Management B.R.M.RAO BCom, BA, LLB, PGDCRS, PGDPA, PGDBA,PGDRDM,MIMA

  2. Introduction to retailing

  3. Retailing • Retailing 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. • It is the last stage in the distribution process.

  4. Reasons for studying Retailing • Its impact on the nations economy • Its functions in the distribution • Its relationship with firms selling goods and services to retailers for their resale or use • Broad range of career

  5. Impact of Retailing on Economy • Retail sales and employment are vital economic contributors • Retail trends often mirror trends in a nations overall economy • It is a major source of jobs in the coming years. • It contributes to the revenue of the country by direct or indirect means.

  6. Retail functions in Distribution A Typical Channel of Distribution Final Consumer Manufacturer Wholesaler Retailer

  7. Retail functions in Distribution • Retailing is the last stage in the channel of distribution. • Retailers often act as the contact between the manufacturers, wholesalers and the consumers. • Retailers are involved in sorting process- collecting & assortment of goods from various sources • Retailers also communicate with both customers and the manufacturers.

  8. Retailers role in the Sorting Process Manufacturer Brand A Wholesaler Manufacturer Brand B Brand A customers Brand B customers Manufacturer Brand C Brand C customers Wholesaler Retailer Manufacturer Brand D Brand D customers Brand E customers Manufacturer Brand E Brand F customers Wholesaler Manufacturer Brand F

  9. The Relationship Among Retailers and Their Suppliers • Relationship among retailers and suppliers can be complex as retailers are part of distribution channel and also major customers of goods and services. • Channel relations tend to be smoothest with Exclusive Distribution – suppliers make agreements with one or few retailers that designate the latter as the only ones in specific areas. • Channel relations tend to be most volatile with Intensive Distribution – suppliers sell through as many retailers as possible • Selective Distribution – suppliers sell through a moderate number of retailers.

  10. Comparing Exclusive, Intensive and Selective Distribution Lowest Medium Exclusive Distribution Intensive Distribution Selective Distribution Highest Number of retailers Potential for conflict Support from supplier (retailer) Suppliers sales Retailers brand selection Product (retailer) image Competition among retailers

  11. Special Characteristics of Retailing Three factors that distinguish retailing from other types of business are: • The average amount of a sales transaction for the retailers is much less than for manufacturers. • Final consumers make many unplanned or impulse purchases. • Retail customers visit a store even though mail, phone and web sales have increased.

  12. Retail Strategy • A retail strategy is the overall plan guiding a retail firm. • It influences the firms business activities and its response to market forces, such as competition and the economy. • Any retailer should follow and utilize some basic steps in strategic planning.

  13. Steps in Retail Strategy • Define the type of business in terms of goods or services category and the company's specific orientation. • Set long-run and short-run objectives for sales and profit, market share, image and so on. • Determine the customer market to target on the basis of its characteristics and needs. • Devise an overall, long-run plan that gives general direction to the firm and its employees. • Implement an integrated strategy that combines such factors as store location, product assortment, pricing and advertising and displays to achieve objectives. • Regularly evaluate performance and correct weakness or problems when observed.

  14. The Retailing Concept There are four principles of retailing concept: • Customer orientation • Coordinated effort • Value-driven • Goal orientation

  15. The Retailing Concept Customer Orientation Coordinated Effort Retailing Concept Retail Strategy Value-Driven Goal Orientation

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