4 Retailing Options
Brick and Mortar – All products and services are sold to customers from physical stores. Example: McDonald’s
Online or E-tailing– All products and services are sold to customers through an online website. Example:
Bricks and clicks – Products can be bought from a physical store or from an online system. Example: Barnes and
Noble and BN.com
Clicks and calls – In addition to taking orders via the company website, some companies will also offer sales via
the phone. Examples: Lands’ End and L.L. Bean
Omni-channel Retailing - Retailers that are fully committed to engaging customers via catalogs, phone calls,
websites, email, internet chatrooms, social media sites or mobile apps, and of course also in stores. Ex. Nordstorm
3 Retail sources of supply
Manufacturers – These are the companies that actually create the finished goods. Retailers then buy the goods and
that retailer is responsible for distribution and storage.
Wholesalers – These organizations purchase goods from manufacturers. Typically they purchase an assortment of
goods from many manufacturers, thus a retail company could purchase all of their electronics from a single
wholesaler versus having to purchase from each individual manufacturer.
Drop shippers – This one is not really a source of supply, but rather an organization that ties manufacturers and/or
wholesalers directly to consumers.
Chargebacks - These are effectively penalties charged by retail organizations to their suppliers/vendors for any
number of minor and major supply chain offenses
CPFR (Collaborative, Planning, Forecasting, Rescheduling)
A formalized effort by supply chain partners to share data and collectively develop forecasts in an effort to reduce
supply chain costs through better planning.
VMI (Vendor Managed Inventory)
An arrangement where retailers allow vendors to monitor in-store inventories, initiate orders/shipments to the store
when inventories are low, and also bring the items into the store and onto the shelf.
Last Mile - In supply chain the last mile typically refers to the portion of the supply chain between the final
inventory holding facility and the end consumer
Target (Best Practices) 4 Types of Retail ownership
Independents – One store, one owner. Usually they are trying to satisfy a very specialized market or locale.
Example: Family owned corner stores, Boutique store that is run by the owner
Chains – Multiple stores/facilities,
one owner/ company. Example: Home Depot, Wal-Mart, Costco, Gap, Macy’s, Safeway (Amazon.com probably
best fits this category)
Franchises – A franchisor owns the rights to a company and the name. A franchisee is allowed to open an outlet
under that name. The franchisee must abide by the rules and processes of the franchise. Examples: Jiffy Lube,
McDonald’s, 7-eleven, Buffalo Wild Wings, Massage Envy
Cooperatives –Retailer that is owned by its customer members. These organizations typically try and fit the very