Retailers have changed dramatically according to the changing trends and the evolving needs of the consumers.
Classification Of Retail Formats
have changed dramatically according to the changing trends and the evolving
needs of the consumers. Different retail format have emerged over the years and
each have been an improvisation over the earlier formats. Retail stores can be
classified broadly based on store based and non-store based, the store based is
otherwise the brick and the motor stores while the non-store based are those,
which do not use the traditional format. Ownership in store based is further
divided based on ownership and merchandise. This section discusses some of the
prominent formats under each classification
Retail formats are broadly
classified into store based and non-store based retail formats. The store based
formats are the traditional models where you have brick and motor stores while
a direct relationship with the customer is the trust area of the non-store
based. The store based is further divided based on the ownership and the
merchandise held by the stores.
Classification Based On Ownership An independent Retailer- these
are retail stores which owns only one retail outlet. Usually the format is
passed from generation to generation and this is has a proprietor who owns the
store. 80 percent of the retail stores fall under this class in our country.
From the paan shops to the kirana stores we find this type of stores in our
country. Saravana stores is a good example.
A Chain Retailer They are otherwise known as the
corporate chain where we find two or more outlets under a common ownership.
These stores have commonality in merchandise, store layout, ambience etc. The
advantage of this particular type of format is the economies of scale they
enjoy. Here since they are scattered all over consumer preference may not be
given greater importance. Some of the chain retailers are Mega mart and
Franchising This is a contractual agreement
between two parties where the franchiser allows the franchisee to conduct the
business under an established name in return for a fee. Some of the well-known
franchisers are Mc Donald’s, Archie’s stores, Pizza Hut etc
Leased Departments These is otherwise known as shops
in shops. In this particular type a portion of a store is rented or leased to a
third party. We see Coffee Day having outlets in Crossword bookstores or Pizza
Corners in multiplexes.
Consumer Cooperatives These are retail institutions
owned by consumers and this is mainly because of dissatisfied customers whose
needs were never fulfilled by the existing retailers. Some of these are either
owned by the government or backed by government. This helps in price negotiations
and is one of the prime players when price quality is considered as an
important parameter. We find Farmers cooperatives, Mahila cooperatives and
employee cooperatives in different locations.
Classification Based On Merchandise
Convenience Stores These are relatively small stores
near residential area and are open for long hours. They carry limited line of
high turnover products and have self-service formats. This format is emerging
in India and they work seven days a week. BP’s In&Out, HP Speed mart fall
under this category.
Supermarkets These stores are relatively large
and operate on low costs, low margins, high volume and offering a self-service
format. The store houses food, laundry, and household maintenance products.
Some examples for this format are Nilgiris and Food World.
Hypermarkets Has it’s origins in the US, these
are stores that have a space of about 80,000 to 2,20,000 sq ft. the combine
supermarket, discount stores and the warehouse principles in setting up them.
They are usually situated on the outskirts of big cities and towns. In India
the size is proportional and is not too big. Big bazaar is considered as a
Stores They are characterized by narrow
line, with deep assortments in that particular product line. For the speciality
stores a well-defined target market is essential. Personal attention, store
ambience, customer service are
important to the retailers. Music World, Gautier
Furniture’s are examples of this type of retailers. A new form of speciality
stores have emerged and are called the category killers, who offer products
from a single product line at economical prices. This particular concept has
found tremendous appeal with the Indian market. Toys kemp in Bangalore is a
classic example of this type of stores
Departmental Stores This format originated in the
mid-nineteenth century and is popular in many parts. They are large scaled
retail outlets whose merchandise offer runs across different product lines.
Apparel and home furnishing are the most common categories found in the
departmental stores. The size of an average Indian departmental store varies
between 20,000-40,000 sq ft, while that of the western stores are around 75,000
+ sq ft. Some of the big players in this format are Life style, Globus, Ebony
and so on.
Off-price Retailers In this format, the merchandise
is sold less than the MRP. The retailers buy manufacturer’s seconds or overruns
as a result of which the merchandise may be in odd sizes or may be minor
defects. Some off-price retail stores are manufacturer run and are called the
factory outlets and sell the manufacturer’s products at lesser prices compared
to other retailers. Mega Mart, Levi’s factory outlets are some of the examples
of this format.
Catalogue showrooms They are retailers who specialize
in goods like jewellery, electronics. Customers have to check through a
catalogue and then order the product they need. This concept s still in the
nascent stage in the Indian market
Non-Store Retailing A form that is gaining ground in
the non-store retailing, in this type of retailing the customers have a direct
relationship with the retailers. The non-store retailing is broadly classified
into direct selling and direct response marketing, which incorporates mail
orders, television shopping and electronic shopping
selling This form of retailing is common
for products like cosmetics, food products, educational materials and basic
home appliances where the consumer will be in his place while the marketer
brings the products to his doorsteps. Over the last decade the concept has
grown leaps and bounds and according to the direct selling industry in India,
there has been a 60-65 percent growth in sales turnover from this industry
alone every year.
Telemarketing Using the telephone to sell
directly to consumers has become the major direct marketing tool. Marketers use
outbound telephone charges to help sell their products and services. Some
telemarketing systems are fully automated. Marketers also use inbound toll-free
numbers to receive orders arising from interactive marketing done through
television and radio ads, direct mail or catalogs. Telemarketing is used in
industrial as well as consumer marketing. The recent explosion in unsolicited
telephone marketing has annoyed many consumers who object to the almost daily
junk phone calls that pull them away from their normal routines. Today mobile
companies, insurance companies and banks are using this technique.
order Retailing This form eliminates personal
selling and the physical store operations. This format is appropriate to
specialty products or narrow product lines and where the target market is well
defined. The main advantage of this type of retailing is the convenience they
offer to the customers. In India, long since book publishers (Prentice –Hall,
Tata McGraw Hill, Sultan chand etc. )are using this method of selling. Television Shopping- the
television based retailing has received fair amount of success in India. With
players like Asian Sky shop, TSN products are advertised on televisions with
features, warranties and prices discounts. Phone numbers are given for
different cities where the customers have to give a call to the nearest place
and order the products. The products are then home delivered.
Electronic Shopping The fastest growing medium to do
retailing is electronic medium. Every brick and motor retailers are looking for
click only models whereby customers can order products at the click of a
button. This format virtually eliminates the physical infrastructure needed and
can help in reducing the cost of operations. An effective supply chain is what
these players need. It has been estimated that the Indian online shopping
market is worth Rs.150 crores with 25% growth in 2005-06. The industry is
expected to grow in the next 3-5 years. E-bay, rediff.com are some of the
online shopping portals in the country. Pantaloon: Fashion by Pantaloon Pantaloon is the company’s departmental store and
part of life style retail format. In fact, PRIL took its very initial steps in
the retail journey by setting up the first Pantaloon store in Kolkata in 1997.
In a short time Pantaloon has been able to carve a special place for it self in
the hearts and minds of the aspirational Indian customers. The company has
depth of offering for both men and women at affordable prices. A striking
characteristic of Pantaloon has been the strength of its private label
programme. John Miller, Ajile. Scottsvile, Lombard, Annabelle are some of the
successful brands created by the company. Big Bazaar: Is se sasta aur acha
kahin nahin Big bazaar is the company’s foray into the world of hypermarket discount
stores, the first of its kind in India. Price and the wide array of products
are the USP’s of Big Bazaar. Close to two lakhs products are available under
one roof at prices lower by 2 to 60 per cent over the corresponding market
prices. The high quality of service, good ambience, implicit guarantees and
continuous discount programmes have helped in changing the face of the Indian
retailing industry. A leading foreign broking house compared the rush at Big
Bazaar to that of a local suburban train Food Bazaar – Wholesale prices Food Bazaar’s core concept is to create a blend of
a typical Indian Bazaar and International supermarket atmosphere with the
objective of giving the customer all the advantages of Quality, Range and Price
associated with large format stores and also the comfort to See, Touch and Feel
the products. The company has recently launched an aggressive private label
programme with its own brands of tea, salt, spices, pulses, jams, ketchups etc.
With unbeatable prices and vast variety (there are
Tags : MARKETING MANAGEMENT - Retailers And Wholesalers
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