types-of-retailers-1224232985829864-9 (1)

types-of-retailers-1224232985829864-9 (1) - Chapter 2 :...

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Chapter 2 : Types of Retailers HDCS 3303 – Section 12711 Introduction to Merchandising Evangeline Caridas
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I. Types of Retailers Over time, different types of retailers have emerged and prospered because they have attracted and maintained a significant customer base.
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I. Types of Retailers (Cont.) A. Nature of Retail Mix The most basic characteristic of a retailer is its retail mix-the elements used by retailers to satisfy their customer’s needs. 4 elements of the retail mix that are particularly useful for classifying retailers are the type of merchandise sold, the variety and assortment of merchandise sold, the level of customer service, and the price of the merchandise.
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I. Types of Retailers (Cont.) A. Nature of Retail Mix (Cont.) The difference between the retail mix of department and discount stores illustrated the tradeoff retailers make between the price of merchandise they sell and the services they offer to their customers. To make profit and provide these additional benefits to its customers, department stores have to increase the prices of its merchandise to cover the additional costs. This is referred to as the price-cost tradeoff.
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I. Types of Retailers (Cont.) B. Types of merchandise The US Bureau of the Census developed and uses a classification scheme to collect data on retail activity in the US. It classifies all retail firms into a hierarchical set of four digit Standard Industrial Classification (SIC) codes. To address problems with classification using SIC codes and develop economic statistics similar to international trading partners, the US Bureau along with Mexico and Canada, adopted a new classification system, the North American Industrial Classification System (NAICS), which started to appear in 1999.
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I. Types of Retailers (Cont.) B. Types of merchandise (Cont.) Conversion from SIC to NAICS will be completed in 2004. The NAISC system recognized the growth in services and specialty store retailing by assigning numbers to categories such as nail salons and pet supply stores. The degree to which retailers compete against each other isn’t always based on the similarity of their merchandise. The variety and assortment of the merchandise they offer and the services they provide must also be considered.
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I. Types of Retailers (Cont.) 1. Variety and Assortment Variety is the number of different merchandise categories a retailer offers. Assortment is the number of different items in a merchandise category. Each different item of merchandise is called and SKU ( stock keeping unit). Variety is often referred to as the breadth of merchandise and assortment is referred to as the depth of merchandise.
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C. Customer Services Retailers also differ in the services they offer customers. Customers expect retailers to
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This note was uploaded on 03/30/2012 for the course ADM MKT taught by Professor Mat during the Spring '12 term at Universidad Del Pacifico - Ecuador.

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types-of-retailers-1224232985829864-9 (1) - Chapter 2 :...

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