TYPES OF RETAILER

TYPES OF RETAILER

Consumers today can shop for goods and services in a wide variety of retail organizations. There are store retailer, nonstore retailer, and retailer organization.

1. SUPERMARKETS

These are large self-service stores traditionally selling food, drinks and toiletries, but range broadening by some supermarket chains means that such items as non-prescription pharmaceuticals, cosmetics, and clothing are also being sold. While one attraction of supermarkets is their lower prices compared with small independent grocery shops, the extent to which price is a key competitive weapon depends upon the supermarket’s positioning strategy.

2. DEPARTMENT STORES

So-called because related product lines are sold in separate departments such as men’s and women’s clothing, jewelry, cosmetics, toys, and home furnishings, in recent years department stores have been under increasing pressure from discount houses, specialty stores and the move to out-of-town shopping. Nevertheless, they are still surviving in this competitive arena.

3. SPECIALTY SHOP

These outlets specialize in a narrow product line. For example, many town centers have shops selling confectionery, cigarettes and newspapers in the same outlet. May speciality outlets sell only one product line such as Tie Rack and Sock Shop. Specialization allows a deep product line to be sold in restricted shops space. Some speciality shops focus on quality and personal services such as butchers and greengrocers.

4. DISCOUNT HOUSES

These sell products at low prices by bulk buying, accepting low margins and selling high volumes. Low prices, sometimes promoted as sale prices, are offered throughout the year. As an executive of Dixons, a UK discounter of electrical goods, commented we only have two sales each lasting six months. Many discounters operate from out-of-town retail warehouses with the capacity of stock a wide range of merchandize.

5. CATEGORY KILLERS

These are retail outlets with a narrow product focus but with an unusually wide width and depth to that product range. Category killers emerged in the USA in the early 1980s as a challenge to discount houses. They are distinct from speciality shops in that they are bigger and carry a wider and deeper range of products within their chosen product category, and are distinguished from discount houses in their focus on only one product category.

Two examples of the category killer are Toys “R” Us and Nevada Bob’s Discount Golf warehouses, e-marketing 20.1 discusses how Toys “R” Us operates and gains competitive advantage over traditional toy outlets, while facing a major threat from a new internet – based competitor eToys.

6. CONVENIENCE STORES

These stores offer customer the convenience of close location and long opening hours every day of the week. Because they are small they pay higher prices for their merchandise than supermarkets, and therefore have to charge higher prices to their customers. Some of these stores join buying groups such as spar or mace to gain some purchasing power and lower prices. But the main customer need that they fulfill is for top-up buying, for example when short of a carton of milk or loaf of bread. Although average purchase value is low, convenience stores prosper because of their higher prices and low staff costs, many are family businesses.

7. CATALOGUE STORES

These retail outlets promote their products through catalogues which are either posted or are available in the store for customers to take home. Purchase is in city center outlets where customers fill in order forms, pay for the goods and then collect them from a designated place in the store. In the UK, Argos is a successful catalogue retailer selling a wide range of discounted products such as electrical goods, jewelry, gardening tools, furniture, toys, car accessories, sports goods, luggage, and cutlery

NONSTORE RETAILING

MAIL ORDER

This non-store form of retailing may also employ catalogues as a promotional vehicle but the purchase transaction is conducted via the mail. Alternatively, outward communication may be by direct mail, television, magazine or newspaper advertising. Increasingly orders are being placed by telephone, a process which is facilitated by the use of credit cards as a means of payment. Goods are then sent by mail. A growth area is the selling of personal computers by mail order. By eliminating costly intermediaries, products can be offered at low prices. Mail order has the prospect of pan-European catalogues, central warehousing and processing of cross-border orders.

AUTOMATIC VENDING

Automatic vending is used for a variety of merchandise including impulse goods like cigarette, soft drinks, coffee, candy, newspapers, magazines, and other products like hosiery, cosmetics, hot food, condoms, and paperbacks. Vending machines are found in factories, offices, large retail stores, gasoline stations, hotels, restaurants and many other places. They offer 24 hours selling, self-service, and merchandise that is always fresh.

BUYING SERVICE

This is a storeless retailer serving a specific clientele usually employees of large organizations who are entitled to buy from a list of retailers that have agreed to give discounts in return for membership.

DIRECT SELLING

Direct selling, sometimes called door-to-door retailing, involves direct sales of goods and services to consumers through personal interactions and demonstrations in their home or office.

TELEMARKETING

Another form of nonstore retailing, called telemarketing, involves using the telephone to interact with and sell directly to consumers. Compared with direct mail, telemarketing is often viewed as a more efficient means of targeting consumers, although the two techniques are often used together.

ONLINE RETAILING

Online retailing allows consumers to search for, evaluate, and order products through the internet. For many consumers the advantages of this form of retailing are the 24-hour access, the ability to comparison shop, in-home privacy and variety.

REFERENCES

Aham Anyanwu (2000), Dimensions of Marketing. 2^nd Edition. (Owerri: Pascal Publications), p.146.

Ben, Ogedengbe (2007), Small Business Management: A Contemporary Approach. 1^stEdition (Kaduna: Data Prints), p. 152.

David Jobber (2009), Principles and Practice of Marketing. 3^rd Edition. (New York: McGraw – Hill), p. 745 – 760.