Presentation 1

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Chapter 1 Introduction to the World of Retailing Irwin/McGraw-Hill Levy/Weitz: Retailing Management, 4/e Copyright © 2001 by The McGraw-Hill Companies, Inc. All rights reserved.

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Chapter 1Introduction to the World of RetailingIrwin/McGraw-HillLevy/Weitz: Retailing Management, 4/eCopyright 2001 by The McGraw-Hill Companies, Inc. All rights reserved.2Definition of RetailingRetailing is a set of business activities that adds value to the products and services sold to consumers for their personal or family use.

A retailer is a business that sells products and/or services to consumers for the personal or family use. RetailAccording to Philip Kotler Retailing includes all the activities involved in selling goods or services to the final consumers for personal, non business use. A retailer or retail store is any business enterprise whose sale volume comes primarily from retailing. retaillier (french word), which means to cut off a piece or to break bulk.A retailer may be defined, as a dealer or trader who sells goods in small quantities.

Distribution ChannelPPT 1-4

Different Perspectives of RetailersManufacturersPerspective One of the Controllable Elements in the Firms Marketing Program -- One of the Four PsRetailers Perspective A Business with all the Business Functions -- Production BuyingMerchandise, Private LabelMarketingHRAccounting and FinancePPT 1-5Value Added by Retailers Providing Assortment Breaking Bulk Holding Inventory Offering ServicesPPT 1-6Characteristics of retailingIt offers direct interaction Sale volume is comparatively large in quantitiesCustomer serviceSales promotions are offered at this point onlyDifferent formsLocation and layout are critical factorsMore employment opportunitiesFunctions of a RetailerRetailers provide important functions that increase the value of the products and services they sell to consumers and facilitate the distribution of those products and services for those who produce them. These functions are.. 1) Providing an assortment of products and services Most consumers are well aware of the product assortments retailers offer. 2) Breaking Bulk To reduce transportation costs, manufacturers and wholesalers ship cases / cartons to retailers. This is called breaking bulk. It is cost effective for both manufacturers and consumers.Conti3) Holding inventory - A major function of retailers is to keep inventory that is already broken into user friendly sizes so that products will be available when consumers want them.

4) Providing services a) Retailers provide services that make it easier for customers to buy and use products.

b) They offer credit so consumers can have a product now and pay for it later.

c) They display products so consumers can see and test them before buying.

d) Some retailers have salespeople on hand to answer questions and provide additional information about products. Conti5) Increasing the value of products and services By providing assortments, breaking bulk, holding inventory, and providing services, retailers increase the value consumers receive from their products and services. RetailAccording to Philip Kotler Retailing includes all the activities involved in selling goods or services to the final consumers for personal, non business use. A retailer or retail store is any business enterprise whose sale volume comes primarily from retailing. retaillier (french word), which means to cut off a piece or to break bulk.A retailer may be defined, as a dealer or trader who sells goods in small quantities.

RetailAccording to Philip Kotler Retailing includes all the activities involved in selling goods or services to the final consumers for personal, non business use. A retailer or retail store is any business enterprise whose sale volume comes primarily from retailing. retaillier (french word), which means to cut off a piece or to break bulk.A retailer may be defined, as a dealer or trader who sells goods in small quantities.

Retail EvolutionBarter systemHaats periodic markets that form a major part of the rural market system in India. This is a location which witnesses a public gathering of buyers and sellers at fixed times at fixed locations.Melas Melas are fairs, and they can range from commodity fairs to religious fairs. It is estimated that more than 25,000 melas are held annually in the country. It is estimated that the average outlets in every mela would be more than 800.Mandis Mandis are markets set up by the state government for the sale of agricultural produce directly from the farmers. Conti..Public Distribution system was introduced in India in the year 1950. ( the evolution of the public distribution of grains in India)Kendriya bandars (1963)Mother dairy ( foods and provisions)Co-operative stores( In Mumbai, Bombay bazar)From the 1950s to the 1980s, investments in various industries was limited due to low purchasing power and the govts policies favouring the small scale sctor.From 1990s the Indian economy slowly progressed from being state led to becoming market friendly

ContiThe first time organised retailing was noticed in the textile sector. Viveks, Nallis, Raymonds, Vimal, Garden etc. This was the beginning of new era in retail in IndiaThe vast middle class market demanded value for money products (Post liberalisation).The concept of retail as entertainment came to India with the advent of malls.From 3 malls in the year 2000, to 25 in 2003, 220 malls in 2006, with a cumulative estimated space of 40 million sq.ft and over 600 malls by 2010, giving cumulative estimated retail space of as much as 100 million sq.ft.

The Evolution of Retail in India[Traditional formatsItinerant salesmanHaatsMelasMandisEstablished formatsKirana shopsConvenience / departmental storesCompany / multi brand showroomsPDS / fair price shopsCo-operative storesPan / Beedi shops

Emerging formatsExclusive retail outletsHypermarketsMalls / specialty mallsMultiplexesRural oriented formatsFast food outlets etc.