Chapter 3 ChatGPT Flashcards
Retail Strategy
What is a retail strategy?
A retailer’s overall plan that guides its business, including mission, goals, market, activities, and control mechanisms.
Example: Walmart’s strategy focuses on cost leadership, offering low prices through efficient supply chain management.
Importance of Strategic Planning
Why is strategic planning important in retailing?
It helps retailers:
Set clear goals.
Differentiate from competitors.
Plan resource allocation.
Adapt to economic, legal, and competitive environments.
Example: Amazon’s strategy evolved from selling books online to becoming a global e-commerce leader with diverse products and services.
Situation Analysis
What is situation analysis in retailing?
A candid evaluation of a retailer’s opportunities and threats, including market position, competition, and environmental factors.
Example: IKEA capitalized on the lack of affordable, stylish furniture to dominate the budget-friendly home furnishings market.
Organizational Mission
What is an organizational mission in retailing?
A retailer’s commitment to a business type and its market position, guiding its relationship with customers, employees, and suppliers.
Example: Trader Joe’s mission is to offer high-quality, affordable groceries with a unique customer experience.
Ownership & Management Options
What are the three types of retail ownership?
Sole Proprietorship – Owned by one person, simple but risky.
Partnership – Shared ownership and responsibility.
Corporation – Legal entity separate from owners, better for scaling.
Example: A small boutique (sole proprietorship), a family-run restaurant (partnership), and Walmart (corporation).
Retail Goals & Objectives
What are the four major types of retail objectives?
Sales Growth – Expanding sales over time.
Profitability – Ensuring a healthy return on investment.
Satisfaction of Publics – Maintaining positive relationships with stakeholders.
Image & Positioning – Creating a brand identity.
Example: Tiffany & Co. positions itself as a high-end jewelry brand, while Dollar General focuses on affordability.
Competitive Positioning Strategies
What are the two main retail positioning strategies?
Mass Merchandising – Large-scale, value-oriented, broad product selection (e.g., Walmart).
Niche Retailing – Targeting specific customer segments (e.g., Lush for organic beauty products).
Target Market Selection
What are the three target marketing techniques?
Mass Marketing – Broad audience (e.g., McDonald’s).
Concentrated Marketing – One specific market (e.g., Lululemon for yoga enthusiasts).
Differentiated Marketing – Multiple segments (e.g., Nike serves athletes and casual wear consumers).
Controllable vs. Uncontrollable Variables
What are examples of controllable and uncontrollable retail variables?
Controllable: Store location, pricing, product selection, promotion.
Uncontrollable: Economic conditions, competition, legal regulations, consumer preferences.
Example: A retailer can control its store ambiance but cannot control a sudden economic downturn.
Legal Considerations in Retailing
What legal factors impact retail strategy?
Zoning laws (store location).
Labor laws (hiring & firing).
Consumer protection laws (return policies).
Environmental regulations (waste management).
Example: Blue laws restrict alcohol sales on Sundays in some U.S. states.
