Chp-16 ~ Retail Trade Flashcards
What is retail trade?
Retail trade includes activities involved in selling directly to the ultimate customers for personal and non-business use. (~by the American Marketing Association)
What are the characteristics of retail trade?
- Retailer is the intermediary between the wholesaler and the ultimate consumer.
- Buys goods from wholesalers and sells them in small quantities to the ultimate customer.
- Maintains personal contact with his customers.
- Deals in a wide variety of goods.
- Buys goods on credit and sells them on cash basis.
- Retail shops are situated nearer to the customers.
What are the different types of retailers?
- Small-Scale retailers
a) Mobile Traders
b) Fixed Shops - Large-Scale retailers
Give example of mobile traders or itinerants.
- Hawkers
- Pedlars
- Pavement dealers/ Street dealers
- Cheap Jacks
- Market traders
Give examples of fixed shops.
- Street stall holder
- Second-hand goods shop
- General stores
- Single-line stores
- Speciality shops
What are different types of large-scale retail shops?
- Departmental stores
- Chain stores
- Mail order houses
- Consumer cooperative stores
- Hypermarkets
- Franchise
- Teleshopping
- Automatic Vending Machine
What are departmental stores?
A departmental store is a large size retail establishment consisting of several departments and each dealing in one line of goods.
All departments are located in one building and function under centralised management and control.
What are the characteristics of departmental stores?
- Large size
- Central location
- Wide range of goods
- Specialisation
- Attractive appearance
- Unified Management
What are the merits of departmental stores?
- Convenience in shopping
- Wide choice
- Economies of large scale
- Central location
- Services
- Economy in advertising
What are the demerits of departmental stores?
- High cost of operations
- Higher prices
- Distance
- Lack of personal touch
- Difficulty in coordination
- Difficult to establish
What are chain stores or multiple stores?
It is a group or chain of retail stores dealing in similar merchandise under single ownership and centralised management.
What are the characteristics of chain stores?
- Large size
- Specialisation
- Decentralised location
- Centralised management
- Case sales
- Uniform display
What are the merits of chain stores?
- Low price
- Economies of scale
- Large turnover
- No bad debts
- Convenience in shopping
- Flexibility
What are the demerits of chain stores?
- Limited choice
- Absence of services
- Low motivation
- Lack of personal touch
- Heavy overheads
- Difficulty in cooperation
- Huge capital
What are mail order business houses?
It is a kind of retail trade wherein business is done through post.
Goods are delivered through Value Payable Parcel (VPP).
What are the features or essential conditions of mail order business houses?
- Good postal facilities
- Large and scattered population
- Heavy advertising
- Suitable products
- Reasonable prices
- Money-back guarantee
What are the merits of mail order business houses?
- Low costs
- Convenience in shopping
- Wider market
- Small investment
- No bad debts
- Elimination of middlemen
What are the demerits of mail order business houses?
- Lack of personal touch
- Absence of prior information
- Limited scope
- No credit
- Costly advertising
- Delay and expense
What are consumers’ cooperative stores?
It is a retail establishment organised and operated by the consumers to obtain products of daily use at reasonably low prices.
What are the characteristics of consumers’ cooperative stores?
- Voluntary association of consumers registered under the Cooperatives Societies Act.
- Owned and managed by consumers.
- Deals in articles of daily use
- Purchases goods from producers and wholesalers.
- Sells goods to members and may also sell to non-members.
- Every member has one vote irrespective of share holding.
What are the merits of consumers’ cooperative stores?
- Low operating costs
- Thrift and savings
- Bulk buying
- Democratic management
- Economic security
- Social services
What are the demerits of consumers’ cooperative stores?
- Shortage of capital
- Inefficient management
- Conflicts among members
- Limited services
What are hyper markets? List its merits.
Hypermarket combines the features of a super-market and discount shopping in one location.
Its merits include the following:
1. Very wide range of choice
2. Good deals on bulk buying : value for money
3. More variety of every product
4. Well-organised and good quality
5. Good ambience
6. Efficiency due to scale and area.
What is a franchise?
It is a commercial concession by which a company or person grants to retailer the right of selling its products or services in a specified area.
