Chapter 1: Introduction to Retailing

Study Notes

Retailing adds value to products and services sold to consumers through various channels (e.g., stores, apps, online).
Retailers encompass businesses like motels and food delivery services.
Retail is integrated throughout the supply chain, involving manufacturing, distribution, and retail.
Retailers create value by offering diverse assortments, services like delivery or payment flexibility, and breaking down bulk purchases into smaller quantities.
Inventory management is critical for retailers to ensure products are available when needed.
Vertical integration occurs when a retailer controls manufacturing or wholesaling activities. Retailers might also create their own brands.
Forward integration includes a manufacturer opening a retail store.
The U.S. has a large retail market due to efficient distribution systems.
China's retail market is fragmented, but e-commerce is significant.
India's retail market is dominated by small stores and has high supply chain costs due to infrastructure limitations.
Retail significantly contributes to GDP and employment.

Retail characteristics include variety (breadth of merchandise categories), assortment (depth within each category), and stock keeping units.
Food retailers include supermarkets focusing on fresh produce and packaged goods; and warehouse clubs like Costco.
General merchandise retailers are categorized differently.
Service providers, unlike merchandise retailers, focus on intangible products such as salons or gym memberships.
Retail businesses have different ownership models including independent stores, corporate chains, and franchises.

Seven critical elements of digital retail are core goals, context, communication, community, commerce, and connection.
Mobile and social media are key differentiating factors in digital retailing.
Media types include owned (controlled by retailer), paid (advertisements), and earned (external reviews).
Strategies for mobile retail include developing mobile apps and responsive website designs.
Influencer marketing should consider relevance, reach, response, and return on investment (ROI).
Ethical consideration is crucial in influencer marketing and digital retail.

Retail channels include in-store, internet, mobile, social media, catalog, and direct selling.
Omnichannel retailing strives for seamless customer experiences across multiple channels.
Benefits of omnichannel practices include improved customer experiences and cost savings.
Potential challenges are inconsistent brand image, showcasing in-store products for online purchase, and supply chain complexities.

The buying process includes need recognition, information search, evaluation, purchase decision, and post-purchase evaluation.
Buying processes include extended problem-solving, limited problem-solving, and habitual decision-making.
Factors influencing purchasing include social and economic impacts.
Consumer segmentation are categorized into different groups.

Retail financial strategies include understanding objectives, reviewing financial performance paths using the strategic profit model, and identifying performance measures.
Key performance measures are return on assets (ROA) and societal factors.
Profit improvement strategies and asset management strategies are part of the strategic profit model.

Retail location types include planned (coordinated by a single entity, such as shopping centers) and unplanned (freestanding and urban areas).
Types of shopping centers include neighborhood centers, community centers, lifestyle centers, power centers, and enclosed malls.
Factors influencing location decisions include market saturation, economies of scale, and cannibalization.
Site selection process includes identifying potential regions and sites, assessing trade area demographics, evaluating site accessibility, visibility & competition, and forecasting sales.
Considerations for leases include percentage lease (based on sales), fixed-rate, and common-area maintenance (CAM) fees.
Termination clauses in leases provide flexibility for exiting agreements.