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37 Cards in this Set
- Front
- Back
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North American Industry Classification System |
Classification of retail firms into a hierarchical set of six-digit codes based on the types of products and services they produce and sell
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Breadth of merchandise vs Depth of merchandise
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Variety: the number of different merchandise categories within a store or department Depth of merchandise: the number of SKUs within a merchandise category; also called assortment and depth of stock SKU (stock keeping unit) the smallest unit available for keeping inventory control; a SKU usually means size, colour, and style |
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General Merchandise Retailers |
Discount stores specialty stores category specialist/category killer department stores drugstores off-price retailer value retailers pop-up stores |
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Discount store |
offers a broad variety of merchandise, limited service and low prices offer both private labels and national brands also known as: mass merchandisers or full-line discount stores ex: target: giant Tiger, and walmart |
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Specialty store |
Store concentrating on a limited number of complementary merchandise categories and providing a high level of service in an area typically under 8000 square feet Issues in Specialty Store: Mall-Based apparel retailers Decline in mall shopping and apparel sales Lack of new fashions Less interest in fashion due to aging population Increase price consciousness |
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Category Specialist |
A discount retailer that offers a narrow but deep assortment of merchandise in a category and thus dominates the category from the customers' perspective Also called category killer Issues in Category Specialists: Intense direct competition DifferentiationFocus on service Wholesaling to business customers and retailing to consumers Available locations Increased competition with national expansion and consolidation |
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Department store |
A retailer that carries a wide variety and deep assortment, offers considerable customer services, and is organized into separate departments for displaying merchandise Issues in Department Store Retailing: Competition Discount stores on price Specialty stores on service, depth of assortment Reduction in overall sales Lower cost by reducing services Centralized POS & wrapping Customers wait for sale Focus on apparel and soft goods Develop private labels and exclusive brands |
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Leased department |
An area in a retail store leased or rented to an independent company. The leaseholder is typically responsible for all retail mix decisions involved in operating the department and pays the store a percentage of its sales as rent |
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Drugstores |
Specialty retail store that concentrates on pharmaceuticals and health and personal grooming merchandise Issues in Drug Store Retailing: Aging Population requires more prescription drugs Competition from Supermarkets and Discount Stores – Pharmaceuticals Evolution to a New Format (Shoppers Drug Mart, London Drugs, Jean Coutu) – Cosmetics and Beauty products Stand Alone Sites with Drive Thru Windows Convenient Store Front End |
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Off-Price Retailers |
Closeout Broad but inconsistent assortment Acquire from closing or bankruptcy General merchandise, clothing and home furnishings Liquidation World Outlet (Factory) Owned by manufacturer Clustered together in geographic area – Cambridge, AllistonFocus on clothing Location offers climate controlled environment, food, parking and bargains Issues in Off-Price Retailing: Opportunistic buying (Winners & Marshall’s) Hurt by sales in department stores Buying first line merchandise |
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Value Retailing |
Target Lower Income Families Low Cost - Low Price points ($1 - $3) Low Cost Location – strip malls Specialize in giftware, party and craft items Limited Services One of the Fastest Growing Retail Segments Your Dollar Store with More, Kelowna BC franchise chain - grown to 150 stores in five years! |
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Pop-Up Stores |
Temporary stores Set up in unfinished non-traditional spaces to create buzz and intercept consumers Open for only months, days or even a few hours A garden centre open in the spring months to capitalize on the season Can be used as an incubator for new ideas |
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Types of Food Retailers |
Conventional Supermarkets Big-Box Food Retailers Supercentres, Hypermarkets and Warehouse Clubs Convenience Stores |
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Conventional Supermarket |
Self service Success factors include: Fresh merchandise Targeting health-conscious & ethnic shopper Better in-store experience cooking exhibitions and food tasting Private label brands – differentiation, lower costs and higher margins |
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Power perimeter |
the area around the outside walls of a supermarket that has fresh merchandise categories |
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Fair trade |
Purchasing practices that require producers to pay workers living wage, well more than the prevailing minimum wage, and offer other benefits, such as on-site medical treatment |
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Locavore movement |
a movement whose adherents' primary source of food originates within a specified radius of where they live |
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Supercentres |
large stores (160 000 to 200 000 square feet) combining a discount store with a supermarket |
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Hypermarkets |
Large combination food (60-70 percent) and general merchandise (30-40 percent) retailers |
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Big-Box stores |
Large; limited- service retailers |
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Warehouse Clubs |
Offer a limited assortment of food and general merchandise with little service Low prices for consumers and small business – Membership required Large stores in low-rent areas Simple, no frills approach to merchandising – skids, racks, stacks Costco, Sam’s Club (in U.S) |
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Convenience stores |
stores that provide a limited variety and assortment of merchandise at a convenient location with speedy checkout |
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Issues in Food Retailing |
Competition from other types of retailers: Department, Drug and Convenience store – food items on the shelves Assortment and price Changes in consumer consumption patterns: Time strapped Eating out more Ready to eat options |
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Nonstore Retail Formats |
Electronic Retailing (e-tailing, online retailing and internet retailing) Catalogue Channel Direct Selling Television Home Shopping Vending Machine Retailing |
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Electronic Retailing |
Broader & Deeper Assortments Information that is comprehensive and timely Personalization Interactive |
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Catalogue Channel |
Access and Convenience for consumers Retailers use a multi-channel strategy by integrating the internet Many merchandise categories from general to very specific Success factors: Customer data Visual appeal Personalized service |
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Direct Selling |
Face-to-Face interaction Demonstration, take orders, deliveryTypes: Party Plan System – social event hosted by the salesperson Multilevel System – master distributors recruit people who sell and recruit others to do the same Pyramid Scheme – illegal activity that only sells to other distributors rather than to end users |
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Television Home Shopping |
T-Commerce or Teleshopping Cable channels dedicated to television shipping – The Shopping Channel Infomercials Direct-response advertising |
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Services Retailing |
Trends Aging population will require health services Increase spend on health & fitness by all population segments Time strapped families have money and will pay for services that will ‘free’ up time Merchandise – Service integration |
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Services vs. Merchandise Retailers |
Differences Intangibility Problems in evaluating service quality Performance of service provider Simultaneous production and delivery Importance of service provider Perishability No inventory, must fill capacity Inconsistency of the offering Importance of HR management |
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Multichannel Retailers |
Retailer that sells merchandise or services through more than one channel |
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M-Commerce |
the purchase of products and services through mobile devices |
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In-Store Electronic Kiosks |
Another access and transaction point for consumers: Search for merchandise Provide consumer with additional assortment choices not available in the store Customization of solutions Complement the service provided by salespeople |
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Wholesale sponsored voluntary cooperative group |
An organization operated by a wholesaler offering a merchandising program to small independent retailers on voluntary basis |
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Types of Retail Ownership |
Independent, single store establishments Corporate Retail Chains Franchising |
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Retail Chain |
a firm that consists of multiple retail units under common ownership and usually has some centralization of decision making in defining and implementing its strategy
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Franchising |
A contactual agreement between a franchisor and a franchisee that allows the franchisee to operate a retail outlet using a name and format developed and supported by the franchisor |
