UNIT C THE BUSINESS OF FASHION

1. UNIT C THE BUSINESS OF FASHION 3.03 Identify the types of fashion retailers.

2. Main types of retailers • General merchandisers • Specialized merchandisers

3. General merchandisers • Carry many types of goods in several price ranges • May be a rural general store or a huge mass merchandiser

4. Specialized merchandisers • Narrower lines of related merchandise • More distinct group of customers • Market certain categories of goods to particular age groups, sizes, and consumer tastes and preferences • Examples: Victoria’s Secret, Footlocker, Lane Bryant

5. Department store retailing • Large-scale mass merchandisers • Usually carry a wide range of sizes • Carry household goods • “Departmentalized” by category/sizes of goods being sold • Each department may have separate salespeople and payment areas. • Generally known for high quality, fashion, and customer service • Usually offer credit and return or exchange privileges

6. Department store retailing (cont.) • Offer numerous customer services such as gift wrap, layaway, and restaurant(s) • Sell to many income levels, but generally target middle to upper income customers • High operating expenses due to number of employees and customer services • Advertise heavily • Large buying and sales volume

7. Types of department stores • Branch stores • Flagship stores • Junior department stores • Chain stores

8. Branch stores Small retail stores owned and operated by a parent store. • May be located in suburbs or other urban areas • Receive merchandise and operation instructions from the original store

9. Flagship stores “Parent” or main stores originally located in a central business district. • Responsible for merchandising and promotion for entire operation • Can make merchandise available to branch stores on short notice • Some flagship stores have closed and moved administrative offices to other locations.

10. Junior department stores Small department stores with limited assortments of apparel, housewares, gifts, and household textiles. • Moderately priced merchandise • Locally owned • Low sales volume makes it difficult for these stores to compete.

11. Chain stores A group of stores owned, managed, merchandised, and controlled by a central office. • All stores carry similar goods at similar prices. • Private label merchandise (Example: Kenmore, Hunt Club) • Decisions made at central headquarters • Merchandise can be produced to the chain’s specifications • May serve as anchor stores • Anchor stores: The attractions that draw customers to shopping centers and malls.

12. Discount store retailing Discount stores: Mass merchandisers that sell at lower-than-average prices. • Located in large, no-frills facilities in high traffic areas • Offer minimal customer services • Merchandise is paid for at checkout counters located near store exits. • High sales volume • Fashion followers • Many retailers are making an effort to offer more current fashions. • Most discounters are chains.

13. Discount store retailing (cont.) • Extended operating hours • Many imports from low-wage countries • Appeal to customers with modest clothing budgets • Off-price discounters • Factory outlets

14. Off-price discounters Retailers that sell brand name or designer merchandise at lower-than-normal prices. • High fashion goods at moderate prices • Changing and unstable collection of merchandise • Buy merchandise at below-wholesale prices • Labels may be cut out to protect merchandise sold in upscale shops

15. Off-price discounters (cont.) • Do not place advance orders • Make low-cost special purchases during the season when other stores are planning for the next season • Stock consists of production overruns, end-of-season goods, closeouts, and irregulars.

16. Factory outlets Discount stores that are manufacturer owned and operated • Sell only merchandise produced by the company • Products sold include overruns, canceled orders, and discontinued items. • May be located in factory malls

17. Specialty store retailing Specialty stores: Retailers that sell limited classifications of merchandise. • Low sales volume • High prices • Offer unusual merchandise, more personalized service, convenience, and ambience • Known for a certain level of design or quality of merchandise • Franchise stores • Boutiques

18. Franchise stores Retail establishments in which a firm or an individual buys the right to use a famous or established name or trademark in a specified trading area.

19. Franchise stores (cont.) • Often located in exclusive shopping areas of major cities or boutique areas within large department stores • The designer or manufacturer does not have direct ownership of the franchise and does not help run the business. They only supply goods to the retailer.

20. Boutiques Small, stand-alone shops or areas within larger stores that sell unusual, limited quantity apparel, accessories, or decorative items.

21. Boutiques (cont.) • High level of customer service • Fashion-forward merchandise • Target special-interest customers • Unique images • New, artistic, and handmade items

22. Nonstore retailing Selling without a conventional store facility. • Mail-order retailing • Telecommunication retailing • In-home selling *Nonstore retailing developed for the convenience of the consumer.

23. Mail-order retailing Selling merchandise through catalogs distributed to customers. • Customers select items by looking at pictures and reading product descriptions. • An alternative for customers who prefer to shop from the comfort of their home or cannot go out to shop • Orders are placed by mail, toll-free calls, computer, or fax.

24. Mail-order retailing (cont.) • Merchandise is usually paid for by credit card and shipped directly to consumer. • Extended order-taking hours • May offer a full line of items or specialize in a single line of merchandise • Many retail department stores and chains offer catalog shopping. • Many mail-order houses also have retail stores. • Customers usually pay high shipping and handling fees.

25. Telecommunication retailing Selling merchandise using communication devices. • Television retailing • Computer (Internet) retailing

26. Television retailing • Television channels are used to show and describe merchandise. • Many celebrities sell signature lines of merchandise. • Consumers can control what they view. • Orders are placed by telephone or online at the company website. • Used to introduce and test the market for new products • Reaches a national audience

27. Computer (Internet) retailing • Electronic retailing or “e-tailing” • Combines computer and telephone technologies with marketing and merchandising • Shoppers view merchandise on computer monitors and order through a modem connection. • Allows customers to view “electronic catalogs” • Allows for comparison shopping

28. In-home selling • Selling outside of a retail store • Used to sell cosmetics, jewelry, clothing lines, and other merchandise through selling parties or door-to-door sales • Merchandise is often high quality and unusual in design. • Prices may be high.