BMGT353 - Class Notes

BMGT353 - Class Notes - BMGT353 Retail Management Prof. Jie...

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BMGT353 – Retail Management Prof. Jie Zhang Office: 3311 Van Munching Hall Hours: Tu/Th: 5-6pm Phone: (301) 405-7899 Email:jiejie@rhsmith.umd.edu
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Lecture 2 – Thursday September 2, 2010 – The World of Retailing What is Retailing? o Retailing: The set of business activities involved in selling products directly to consumers for their personal or family use The products could be goods, services, or a combination of them o A retailer is a business whose sales come primarily from conducting retailing activities o Retailing is a large industries About $4.1 trillion worth of goods and services are purchased by consumers from US retailers in 2009 (including automobiles and food More than 9% of GDP Over 24 million people are employed in retailing, accounting for about 18% of the total labor force in the US. Channel of Distributions o A distribution channel is a set of firms or individuals who facilitate the movement of products from the point of production to the point of sale to the end consumer o Retailers lie at the end of the value chain in a distribution channel Some retailers also perform wholesaling and manufacturing activities. o Sample: Manufacturer Wholesaler Retailer Consumer How do retailers add value? o Provide assortment So that consumers can buy a variety of products at the same time o Breaking bulk So that consumers can buy products at the quantities they want o Holding inventory So that consumers can buy the products when they want to o Provide services To make it easier to buy and use products Retail Mix Decisions o Place: Store Locations
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Product Merchandise assortment (breadth and depth) Service level and types Store layout and design o Price: Pricing High-Low Pricing: Higher price with frequent promotions EDLP: (Everyday Low Prices) o Promotion: Promotion programs (i.e., marketing communications) Target’s Retail Mix o Location: In free standing locations, on large pieces of land Enough drawing power to not need other stores to draw customers into a complex Can be in shopping complexes o Merchandise Assortment: Very broad, but only with a little depth o Customer Service: Moderate o Store Layout & Design: Organized into sections, but hard to find things within each section o Pricing: EDLP o Promotions: TV ads, very few promotions, catalogues Lecture 3 – Tuesday September 7, 2010 The assortment of a retailer’s merchandise is usually described in terms of breadth and depth o Breadth – Number of merchandise categories o Depth – Number of different items in each category o Each item is called a Stockkeeping Unit (SKU) Each SKU has a unique UPC code. Types of Store-Base Retailers
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BMGT353 - Class Notes - BMGT353 Retail Management Prof. Jie...

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