The importance of a store’s proximity to customers has not waned even with improvement in transportation and more families owning vehicles because, in most households, both husbands and wives are working longer hours. They are less fashion oriented, but can be branded stores and fashion stores. 9 Different types of retail stores. 1. But this arrangement will leave a lot of customers dissatisfied as they may find the range too limited. Traditional classifications based upon central place theory are reviewed for both of these types, and found wanting in the light of recent changes in retail development practice and consumer behaviour. Prohibited Content 3. Parking surrounds the outside perimeter. The stores are generally up to 5,000 sq ft and are found in areas where purchasing power is not very high. Consumer decision making involves the choice of brands, and also the choice of retail outlets from where the customer will buy his chosen brands. 3) Pricing Philosophy. This article throws light upon the two broad categories of retail store classification. Classification of retailers as per ownership: Also the friction-less store experience is being considered as the future of shopping. A retailer is the last step of the supply chain. Disclaimer 9. Accordingly, chain stores are drug, tobacco, variet… Typically, enclosed with inward-facing stores connected by a common walkway. This article throws light upon the two broad categories of retail store classification. In India, 49/99 stores have just made mark in the segment. The store has one product category or a very narrow, related range of products. There are many types of retail formats like discount stores, supermarkets, convenience stores, department stores, etc. The retailer’s focus has to be on getting the operation of his store right, which is itself a stupendous task. Like e-tailing the costs are generally lesser due to no or very less cost of distribution, advertisement, retailer margin and inventory. It may also happen that a customer decides to buy from a particular retail format, and then buys from among the brands that the retail format stocks. When chain stores are located at different places within a distinct geographical unit, they are known as sectional stores. Image Guidelines 5. Product categories in which this format is popular are footwear, clothing, furniture and furnishing. They provide limited number of complementary merchandise categories and high level of service in typically up to 10,000 sq ft of store area. Therefore such stores should stock only those items whose purchases the family cannot postpone till the weekend. The variety available in this store format is unparalleled and is the competitive criteria among these stores. Retailers can be broadly classified by form of ownership; independent, part of chain, or franchise outlet. Companies carry out market research to know customer attitude towards their products but the customers’ real intents are displayed only during the process of buying in retail stores. The retail potential database consists of average household and total market potential estimates by each of sixty-eight retail store types. Chain stores are classified on the basis of type of goods handled. That is why it is not very successful in India. Today, consumer can shop for goods and services in a wide variety of stores. This format can afford specialization of retail personnel which will be necessary in handling customers’ enquiries as categories develop. Proximity to customers may even become a liability, because for most people, the idea of entertainment is not walking into the theatre or restaurant which is next door. When it's time to shop for something, we have many options available to us. The evolution of hypermarkets has resulted in wider and deeper product assortments for customers. They are generally largest chains also. This sector has contributed heavily in employment generation and various low cost service retailing business models (like travel agency) has helped in entrepreneurship development. These comprise nonpersonal selling as well as personal or direct selling. Report a Violation, Retail Marketing: Useful notes on Retail Marketing, Retail: Notes on the Classification of Retail Formats, How to Enhance Customer Experience in a Retail Store? These retail formats are characterized by very large retail spaces that are leased out to various brands. If the number of product categories is large, chances are that the range in each one of them would be smaller because of space constraints or else it may become too unwieldy. Content Guidelines 2. Retailing in India is one of the pillars of its economy and accounts for about 10 percent of its GDP. This paper presents a classification of online retail stores based upon an August 1996 convenience sample of 137 Internet retail stores. National chains operate throughout the country. The technique used 35 observable Internet retail site attributes and features of online stores as the raw data to classify the online stores into meaningful groups. They can do this by bulk buying, accepting low margins, managing costs tightly and choosing locations where real estate prices are low. But this will reduce the number of occasions that the customer will find a reason to walk into the store. Speciality store They are a “discounted” specialty stores that offer narrow variety but deep assortment of similar kind of merchandise with limited services and just average atmospherics design. 5-25 miles Regional Mall General merchandise or fashion-oriented offerings. What you’ll learn to do: list the classification characteristics of various types of retailers by ownership. He has to remember that he sells the manufacturer’s products and it is the manufacturer’s duty to make the right products for the customers. For example, we can buy food from supermarkets, convenience stores, restaurants, bars, street vendors, butchers, bakeries, produce stands, online and so on. The store however stocks large amount of variety of these products. The store types are based on the NAICS classification … They are fastest growing segment in market. These stores operate in those product categories for which the customer desires convenience of location. They are retailers of wide variety of merchandise mix (private labels, brands, fashion brands etc.,) at low prices bought from manufacturers through unique opportunistic buying practice. Copyright 10. They may carry merchandise that can be slightly defective as standard norms; famously known as “Factory Outlets”, or carry off season merchandise, not so fast moving designs and unpopular colours. Content Filtrations 6. Disclaimer 9. For instance, IKEA is one such store that stocks every type of furniture, in all price ranges and usage. They can be in categories like apparel, fashion accessories, nutrition, home segment, jewellery, optical, footwear etc. The typical structure for a single-store retailer may consist of the owner performing CEO and manager duties or even a cashier stocking merchandise because the inventory as well as the profit margins are smaller so there is significantly less need for these types of individual employees. Multi-level marketing has made brands like Tupperware, Oriflamme, Avon a worldwide success and pure direct marketing success story of Eureka Forbes will never be forgotten in India. They sell products within strict price point to attract customers. For some consumers self-service is considered a benefit while others may view it as an inconvenience. Abroad QVC, HSN have been very successful and in India Asian Sky Shop has done fairly well. Some specialty stores have a very limited number of product categories (typically one) and the complete range in that category is available under one roof. Privacy Policy 8. Plagiarism Prevention 4. These store formats will ultimately be targeted to specific segments. Chain stores which operate in the city itself or near about the city are known as local chains. As the economy of a country develops, people will want more sophistication and variety in greater number of categories and this can be provided only in this type of format. They also sell “value” for money concept to wide variety of customers. The Indian retail market is estimated to be US$ 600 billion and one of the top five retail markets in the world by economic value. A single-store retailer has a smaller scale of organizational structure in comparison to national chains and diversified retailers. Image Guidelines 5. On the basis of location, chain stores are classified as local, sectional and national chains. He needs empathy to understand customers’ requirements but he also has to be indifferent enough not to let customers’ anguish about the products in his store bother him. Retail is the process of selling consumer goods or services to customers through multiple channels of distribution to earn a profit. Retailing is becoming international in nature and is slowly emerging as an important service. Read this article to learn about classification of retail store formats on the basis of product, price and location! In developing countries, these formats are slowly finding acceptance now. It can be childcare center, financial planning center, dry cleaning center, weight loss center, internet parlour, telephone booths, entertainment parks, hotels, etc. For instance, in India, Ebony Shopper’s Stop are such stores. These stores are subject to good buying power in the community, more young population, robust economic growth and widely exposed community to new trends. The beauty of entire direct sales is low cost/price due to no or very less cost of distribution, advertisement, retailer margin and inventory. 600 353,795,548 4.7% 589,659 400,000-800,000 40-100 2+ 50-70% 40-80 stores Some of the different types of retail store include: Convenience store - a small to medium grocery and convenience shop usually operating near residential areas. Previously, retailers operated from physical stores by selling variety of merchandise or services. From easy-going shoppers who make small talk, to customers on a mission who just want to get in and out of the store, retailers deal with various types of people on a daily basis. General Merchandise Retailer 2. They may also take multi-level marketing routes wherein products are sold by form to master distribution than they sell the products to distribution and chain goes on. It is over 20 billion USD industry and is growing very fast in emerging markets like India. Retailers have a huge amount of information about customer behaviour but all this information is not passed on faithfully to the companies. Here they do not need to advertise or spend on costly store atmospherics and service standards. Families make major purchases for the household during the weekend. Such families need nearby stores when they have to purchase fresh grocery items during the weekdays. However, the advantage of a speciality store is that you will find many things in that store related to that speciality which you … To help make sense of all this, the United States Census Bureau publishes the North American Industry Classification System (NAICS), which places businesses into Classificationsbased on their common characteristics and qualities. Food Retailers Conventional Supermarket Limited Assortment Supermarket Supercenter Warehouse Club Convenience Store 9. They are employed by stores and other retail businesses, wholesale businesses … The categories are: 1. Retailers can locate their stores in an isolated place and attract the customers to the store on their own strength–such as a small grocery store or paan shop in a colony, which attracts the customers staying close by. The products may be urgently required like medicines. This store format is gaining wide acceptance in India as the store acts as a one- stop-shop for the complete family. Plagiarism Prevention 4. Called category killers, these stores eliminate competition in the specified category. Categories like home care, cutlery, baby product, beauty prod­ucts, services, educational products are sold through this channel. They have a very narrow product line. The categories are: 1. As the name suggests, it is selling of product through salesman by reach­ing to target audience at houses or offices or wherever they can be available. This also assures that customers, who may not be able to afford brands during initial period, can use these stores; thus brand associations created for the period when they can afford these brands at regular outlets. Internationally Wal-Mart, Kmart, Target and in India, Big Bazaar, Vishal Mega Mart are leading examples. Nonpersonal selling includes TV, mail, catalog, internet, etc. Dedicated channels or programme time is used to sell merchandise as demonstrated in television through various companies. According to the NAICS 2017 Man… The payment mode differs from product to product and sometimes company-to-company. Before publishing your articles on this site, please read the following pages: 1. It is a huge industry abroad and in India too. Study 17 Chapter 14: Classification of Retail Operations flashcards from Heather T. on StudyBlue. For the systematic study they can be divided in different classes, such as on the basis of ownership, on the basis of product line, on the basis of sales volume and on the basis of operation method. It is a very large subject and as important and wide as store retailing. Report a Violation, Classification of Retail Structure: 3 Categories | Retailing, Classification of Indian Retail Sector: 6 Categories | Retailing. Product sold is generally dry food items, gifts articles, financial services, magazines, candies, etc. These are sometimes called specialty stores. Prohibited Content 3. Non Store Based Classification: Non Store retail organizations focus on establishing direct contact with the consumer. Classification of Retailers on the basis or Retail Location Retailers have also been also been classified according to their store location. The responsibilities of a store manager should be tailored to your specific business’ needs, but generally speaking, this retail job handles a lot of what you might have started out doing as the business owner — from maintaining day-to-day tasks and managing employees to understanding sales trends and, well, everything in between. A retailer’s prime affinity and loyalty is towards the customers of his store, and not to the companies whose goods he sells. 2. Usually such stores are also accompanied by food joints and entertainment plazas that provide an ideal day out. Internationally, Dollar Stores, Family Dollar Stores etc. Retail Formats can be classified into the following categories: Store Based: Store based formats can be further classified into two formats based on the basis of Ownership or Merchandise offered. There are different types of such retailers. All the stores mentioned above charge list prices from their customers. India is one of the fastest growing retail markets in the world, with 1.2 billion people. They also specialize in selling items in lower units, which may not be available in market otherwise. Non-Store Retail Format. There are at least three levels of retail service: Self-Service. This service level allows consumers to perform most or all of the services associated with retail purchasing. Such formats always face a conflict between the number of product categories they should store and the range in each category. 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