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637618658040766219Chapter1session1notesFINAL 1

Retail management notes provide an introduction to retailing, defining it as the sale of goods and services to final consumers for personal use. Retailing is the final stage of distribution. Key functions of retailing include understanding consumer needs, buying and assembling products from wholesalers, breaking bulk quantities into smaller units for consumers, warehousing and storing products, selling to consumers, providing credit, bearing risks associated with goods, grading and packing products, collecting and supplying market information, helping introduce new products, and advertising through window displays.

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19 views2 pages

637618658040766219Chapter1session1notesFINAL 1

Retail management notes provide an introduction to retailing, defining it as the sale of goods and services to final consumers for personal use. Retailing is the final stage of distribution. Key functions of retailing include understanding consumer needs, buying and assembling products from wholesalers, breaking bulk quantities into smaller units for consumers, warehousing and storing products, selling to consumers, providing credit, bearing risks associated with goods, grading and packing products, collecting and supplying market information, helping introduce new products, and advertising through window displays.

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pradeepradeept123
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Retail Management Notes

Chapter 1 Session 1
Introduction to Retail Management

Introduction to Retailing
Meaning of Retailing :
Retailing encompasses those business activities involved with the sale of goods and services to the
final consumer for personal, family, or household use.
Retailing is the final stage in a channel of distribution. Retailing functions are performed by any
firm selling merchandise or providing services to the final consumer.
According to Philip Kotler :
“Retailing includes al the activities involved in selling goods or services to the final customers for
personal, non – business use.”
Functions of Retailing - :
1. Understanding the Needs of Consumers –
Knowing and understanding customer needs is at the centre of every successful business. Therefore,
a retailer should clearly understand needs of his target customers. Every retailer should know the reason for
their customers to buy from them and not from their competitors. This is called Unique Selling Proposition
{USP}. USP can change as the business or market changes. A retailer can have different USPs for different
types of customer.
2. Buying and Assembling –
A retailer deals in different variety of goods which he purchases from different wholesalers for
selling to the consumers. He tries to locate best and economical source of the supply of goods.
3. Breaking the Bulk –
Manufacturers normally send their products in bulk (whole cases or cartons) to retailers to minimize
transportation cost. As the retailers sell goods in smaller quantities, they should break large quantities into
convenient smaller quantities. This process is called breaking the bulk.
4. Warehousing or Storing –
After assembly of goods from different suppliers, the retailers preserve them in store and supply
these goods to the consumers as and when required by them. The goods are kept as reserve stocks in order
to ensure uninterrupted supply to the consumers.
5. Selling –
The end objective of the retailer is to sell the goods to consumers. He undertakes various methods
to sell goods to the ultimate consumers.
6. Credit Facilities –
He caters to the needs of the customers even by supplying them goods on credit. He bears the risk
of bad debts on account of non – payment of amount by the customers.
7. Risk Bearing –
A retailer has to bear different type of risks in relation to goods. While in stores, goods are exposed
to various risks like deterioration in quality, spoilage and perishability etc.
The products are confronted to natural risks viz., fire, flood, earthquake and other natural
calamities. Other type of risks like change in customers tastes also adversely affects the sales.
8. Grading and Packing –
The retailer grades the goods which are left ungraded by the manufacturers and the wholesalers. He
packs the goods in small packages and containers for the convenience of the customers.
9. Collection and Supply of Market Information –
The retailers are in direct touch with the consumers. They gather invaluable information with regard
to likes dislikes tastes and demands of the consumers and pass on this information to the wholesales and the
producers which are very helpful to them.

10. Helps in Introducing New Products –


Without the services of retailers, new products cannot be introduced properly in the market. This is
so because a retailer has a direct link with consumer. He can explain nicely about the utility and the
characteristics of a new product to the customer.
11. Window Display and Advertising –
The retailer displays the products in show windows in order to attract the customers. This leads to
immense publicity for the product.

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