Classification of Retail Operations
BSM 302
PRINCIPLE OF MARKETING
ASSIGNMENT 4
CLASSIFICATION OF RETAIL OPERATIONS
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CLASSIFICATION OF RETAIL OPERATIONS
OWNERSHIP Retailers can be broadly classified by form of ownership; independent, part of chain, or franchise outlet. Retailers owned by a single person or partnership and not operated as part of a larger retail institution are independent retailers. Around the world, most retailers are independent, operating one or a few stores in their community. Local florists, shoe stores, and ethnic fooed markets typically fit this classification. Chain stores are owned and operated as a group by a single organization. Under this form of ownership, many administrative tasks are handled by the home office for the entire chain. The home office also buys most of the merchandise sold in the stores. Gap and Starbucks are example of chain. Franchises are owned and operated by individuals but are licensed by a larger supporting organization, such as Subway or Quiznos. The franchising approach combines the advantages of independent ownership with those of the chain store organization.
LEVEL OF SERVICE The level of service that retailers provide can be classified along a continuum, from full service to self-service. Some retailers, such as exclusive clothing stores, offer high levels of service. They provide alterations, credit, delivery, consulting, liberal return policies, layaway, gift wrapping, and personal shopping. Discount stores usually offer fewer services. Retailers like factory outlets and warehouse clubs offer virtually no services.
PRODUCT ASSORTMENT The third basis for positioning or classifying stores is by the breadth and depth of their product line. Specialty stores – for example, Hallmark card stores, Lady Foot Locker, and TCBY yogurt shops – have the most concentrated product assortments, usually carrying single or narrow product lines but in considerable
PRINCIPLE OF MARKETING
ASSIGNMENT 4
CLASSIFICATION OF RETAIL OPERATIONS
____________________________________________________________
____
CLASSIFICATION OF RETAIL OPERATIONS
OWNERSHIP Retailers can be broadly classified by form of ownership; independent, part of chain, or franchise outlet. Retailers owned by a single person or partnership and not operated as part of a larger retail institution are independent retailers. Around the world, most retailers are independent, operating one or a few stores in their community. Local florists, shoe stores, and ethnic fooed markets typically fit this classification. Chain stores are owned and operated as a group by a single organization. Under this form of ownership, many administrative tasks are handled by the home office for the entire chain. The home office also buys most of the merchandise sold in the stores. Gap and Starbucks are example of chain. Franchises are owned and operated by individuals but are licensed by a larger supporting organization, such as Subway or Quiznos. The franchising approach combines the advantages of independent ownership with those of the chain store organization.
LEVEL OF SERVICE The level of service that retailers provide can be classified along a continuum, from full service to self-service. Some retailers, such as exclusive clothing stores, offer high levels of service. They provide alterations, credit, delivery, consulting, liberal return policies, layaway, gift wrapping, and personal shopping. Discount stores usually offer fewer services. Retailers like factory outlets and warehouse clubs offer virtually no services.
PRODUCT ASSORTMENT The third basis for positioning or classifying stores is by the breadth and depth of their product line. Specialty stores – for example, Hallmark card stores, Lady Foot Locker, and TCBY yogurt shops – have the most concentrated product assortments, usually carrying single or narrow product lines but in considerable