1-1 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall An Introduction to Retailing RETAIL MANAGEMENT: A STRATEGIC APPROACH 11th Edition BERMAN EVANS
1-1 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
An Introduction to Retailing RETAIL
MANAGEMENT:
A STRATEGIC
APPROACH 11th Edition
BERMAN EVANS
1-2 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Chapter Objectives To define retailing, consider it from different
perspectives, demonstrate its impact, and note its special characteristics
To introduce the concept of strategic planning and apply it
To show why the retailing concept is the foundation of a successful business, with an emphasis on the total retail experience, customer service, and relationship retailing
To indicate the focus and format of the text
1-3 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
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.
1-4 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Issues in Retailing How can we best serve our customers while earning a
fair profit?
How can we stand out in a highly competitive environment where consumers have so many choices?
How can we grow our business while retaining a core of loyal customers?
1-5 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
The Philosophy Retailers can best address these questions by
fully understanding and applying the basic principles of retailing, as well as the elements in a well-structured, systematic, and focused retail strategy.
1-6 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-1: Boom Times for Dunkin’ Donuts
1-7 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-2: Careers in Retailing
1-8 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
An Ideal Candidate for a Retailing Career
Must be a people person
Must be flexible
Should be decisive
Must have analytical skills
Must have stamina
1-9 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Table 1-1: The 10 Largest Retailers in the United States
Rank Company Main Emphasis
1 Wal-Mart Full-line discount stores, supercenters,
membership clubs
2 Home Depot Home centers, design centers
3 CVS Caremark Drugstores
4 Kroger Supermarkets, convenience stores, jewelry stores
5 Costco Membership clubs
6 Target Full-line discount stores, supercenters
7 Walgreens Drugstores
8 Sears Holdings Department stores, specialty stores
9 Lowe’s Home centers
10 Safeway Supermarkets
1-10 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-4: A Typical Channel of Distribution
Manufacturer
Wholesaler Final
Consumer
Retailer
1-11 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-5: The Retailer’s Role in the Sorting Process
1-12 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Multi-Channel Retailing
A retailer sells to consumers through multiple retail formats:
Web sites
Physical stores
1-13 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-6: Brooks Brothers and Multi-Channel Retailing
1-14 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Relationship Management Among Retailers and Suppliers
Disagreements may occur in the following areas:
control over channel
profit allocation
number of competing retailers
product displays
promotional support
payment terms
operating flexibility
1-15 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Distribution Types
Exclusive: suppliers make agreements with one or few retailers, designating such retailers as the only ones to carry certain brands or products within a specified geographic area
Intensive: suppliers sell through as many retailers as possible
Selective: suppliers sell through a moderate number of retailers
1-16 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-7: Comparing Distribution Types
1-17 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-8: Special Characteristics Affecting Retailers
Impulse
Purchase
Popularity
of
Stores
Retailer’s
Strategy
Small
Average
Sale
1-18 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Retail Strategy
An overall plan for guiding a retail firm
Influences the firm’s business activities
Influences firm’s response to market forces
1-19 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Six Steps in Strategic Planning 1. Define the type of business
2. Set long-run and short-run objectives
3. Determine the customer market
4. Devise an overall, long-run plan
5. Implement an integrated strategy
6. Evaluate and correct
1-20 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-9: “Expect More. Pay Less” at Target
1-21 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Aspects of Target’s Strategy
Growth objectives
Appeal to a prime market
Distinctive image
Focus
Customer service
Multiple points of contact
Employee relations
Innovation
Commitment to technology
Community involvement
Monitoring performance
1-22 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-10: Applying the Retailing Concept
Customer Orientation
Coordinated Effort
Value-driven
Goal Orientation
Retailing
Concept
Retail
Strategy
1-23 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-11: The Build-A-Bear Experience: Never Boring
1-24 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Customer Service
Activities undertaken by a retailer in conjunction with the basic goods and services it sells. This includes:
Store hours
Parking
Shopper-friendliness
Credit acceptance
Salespeople
1-25 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Figure 1-12: A Customer Respect Checklist
Do we trust our customers?
Do we stand behind what we sell?
Is keeping commitments to customers important to our company?
Do we value customer time?
Do we communicate with customers respectfully?
Do we treat all customers with respect?
Do we thank customers for their business?
Do we respect employees?
1-26 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Relationship Retailing
Retailers seek to establish and maintain long-term bonds with customers, rather than act as if each sales transaction is a completely new encounter
Concentrate on the total retail experience
Monitor satisfaction
Stay in touch with customers
1-27 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Effective Relationship Retailing
Use a “win-win” approach
It is easier to keep existing customers happy than to gain new ones
Develop a customer database
Ongoing customer contact is improved with information on people’s attributes and shopping behaviors
1-28 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Approaches to the Study of Retailing
Institutional
Functional
Strategic
1-29 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
Parts of Retail Management: A Strategic Approach
Building relationships and strategic planning
Retailing institutions
Consumer behavior and information gathering
Elements of retailing strategy
Integrating, analyzing, and improving retail strategy
1-30 Retail Mgt. 11e (c) 2010 Pearson Education, Inc. publishing as Prentice Hall
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