Retailing in your Business

What is Retailing?
In the the USA, "Retailing" can be defined as the buying and selling of goods and services, involving the delivery of those goods and services to consumers who pay for them at prices they are happy with. It involves the selling of the goods and services directly to the final consumers. Retailing involves goods sold directly to the consumer through shops or markets, or by other direct means such as over the Internet or weekend markets, etc.

Why Consider the Business of Retailing?
A major attraction of retailing is that the business owner does not have to go out and promote their products, because people interested in buying will come in to the store. This means that potential customers will already have some interest otherwise they would not enter the shop. The retail business owner can concentrate on selling to them, rather than wasting resources and costs trying to market to people who have no interest.

Categories of Retail
Retail comes under 2 main categories:

  1. Sale of goods.
  2. Sale of services.

If you are in the business of sale of goods, make sure you are clear on the type of goods you wish to sell. You will need to research your market and ensure there will be a demand for your products. Make sure you are clear on the markets you are aiming for and be aware of the potential customers and the type of products or services they require.

Retailing involves selling of goods such as food, clothing or equipment, etc, as well as services (such as labour only) involving a variety of things such as accountancy help, hair salons, mortgage finance and insurance agencies etc.

While retailing is an attractive type of business, which appears to be something most people could accomplish, this type of business involvement is not without its traps and problems. It is not just a matter of displaying your goods or advertising your services, because you need to understand the market and how to promote your products or services, as well as how to service your customers so they will return for repeat business.

Types of Retail Operations

  • Street-front shops
    This is the most common type of retail operation. Here, small shops operate in a street frontage location and deal in one type of product or service.

  • Specialty stores
    This type of retail business concentrates on a specialised type of product, for example, home furnishings, menswear, jewellery, etc.

  • Discount stores
    This is a larger version of the street frontage shops, except that they sell a variety of merchandise rather than one main product or service. A discount store may have products consisting of home ware, furniture, clothing, music and food. They are generally larger retail outlets, based on the concept of discounting and look for volume of sales with a small margin for each item sold. Discount stores include, Wal-Mart, K.Mart, Target etc.

  • Department stores
    This is the largest type of retail operation involving one large store divided into many departments, with each department dealing in a particular product or service. They are similar to the shop front stores, except that various departments are grouped together within one large store. The advantage to the customer, of course, is the availability of products under the one roof.

  • Factory stores
    These are made up of factory outlets where retailers clear excess stock, or provide merchandise to customers at heavily discounted prices. The factory outlets are popular because expensive brand names clear slightly damaged stock, or old stock that has not sold in the upmarket retail outlets.