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Drawing of a self-service store.
Retailing consists of the sale of goods or merchandise from a fixed location, such as a department store or kiosk, or by post, in small or individual lots for direct consumption by the purchaser.[1] Retailing may include subordinated services, such as delivery. Purchasers may be individuals or businesses. In commerce, a retailer buys goods or products in large quantities from manufacturers or importers, either directly or through a wholesaler, and then sells smaller quantities to the end-user. Retail establishments are often called shops or stores. Retailers are
at the end of the supply chain. Manufacturing marketers see the process of retailing as a necessary part of their overall distribution strategy.
Shops may be on residential streets, shopping streets with few or no houses, or in a shopping center or mall, but are mostly found in the central business district. Shopping streets may be for pedestrians only. Sometimes a shopping street has a partial or full roof to protect customers from precipitation. In the U.S., retailers often provided boardwalks in front of their stores to protect customers from the mud. Online retailing, also known as e-commerce is the latest form of non-shop retailing (cf. mail order).
Shopping generally refers to the act of buying products. Sometimes this is done to obtain necessities such as food and clothing; sometimes it is done as a recreational activity. Recreational shopping often involves window shopping (just looking, not buying) and browsing and does not always
result in a purchase.
[edit] Retail pricing
The pricing technique used by most retailers is cost-plus pricing. This involves adding a markup amount (or percentage) to the retailers cost. Another common technique is suggested retail pricing. This simply involves charging the amount suggested by the manufacturer and usually printed on the product by the manufacturer.
In Western countries, retail prices are often called psychological prices or odd prices.
Often prices are fixed and displayed on signs or labels. Alternatively, there can be price discrimination for a variety of reasons, where the retailer charges higher prices to some customers and lower prices to others. For example,
a customer may have to pay more if the seller determines that he or she is willing to. The retailer may conclude this due
to the customer's wealth, carelessness, lack of knowledge, or eagerness to buy. Another example is the practice of discounting
for youths or students. Retailers who are overstocked, or need to raise cash to renew stocks may resort to "sales", where
prices are "marked down", often by advertised percentages - "50% off".
[edit] Retail Services
Behind the scenes at retail there is another factor at work. Corporations and independent store owners alike are always
trying to get the edge on their competitors. One way to do this is to hire a merchandising solutions company to design custom
store displays that will attract more customers in a certain demographic. The nation's largest retailers spend millions every
year on in-store marketing programs that correspond to season and promotional changes. As products change, so will a retail
landscape.
[edit] Etymology
Retail comes from the French word retaillier which refers to "cutting off, clip and divide" in terms of tailoring
(1365). It first was recorded as a noun with the meaning of a "sale in small quantities" in 1433 (French). Its literal meaning
for retail was to "cut off, shred, paring".[2] Like the French, the word retail in both Dutch and German (detailhandel and Einzelhandel respectively)
also refer to sale of small quantities of items.[citation needed]
[edit] Retail types
There are three major types of retailing.
The first is the market, a physical location where buyers and sellers converge. Usually this is done in town squares, sidewalks or designated streets
and may involve the construction of temporary structures (market stalls).
The second form is shop or store trading. Some shops use counter-service, where goods are out of reach of buyers, and must
be obtained from the seller. This type of retail is common for small expensive items (e.g. jewelry) and controlled items like
medicine and liquor. Self-service, where goods may be handled and examined prior to purchase, has become more common since the 20th century.
A third form of retail is virtual retail, where products are ordered via mail, telephone or online without having been
examined physically but instead in a catalog, on television or on a website. Sometimes this kind of retailing replicates existing
retail types such as online shops or virtual marketplaces such as Amazon.[3]
Buildings for retail have changed considerably over time. Market halls were constructed in the Middle Ages, which were
essentially just covered marketplaces. The first shops in the modern sense used to deal with just one type of article, and
usually adjoined the producer (baker, tailor, cobbler). In the 19th century, in France, arcades were invented, which were a street of several different shops, roofed over. Counters, each dealing with a different kind
of article, were invented; it was called a department store. One of the novelties of the department store was the introduction of fixed prices, making haggling unnecessary, and browsing
more enjoyable. This is commonly considered the birth of consumerism [4] In cities, these were multi-story buildings which pioneered the escalator.
In the 1920s the first supermarket opened in the United States, heralding in a new era of retail: self-service. Around
the same time the first shopping mall was constructed [5] which incorporated elements from both the arcade and the department store. A mall consists of several department stores
linked by arcades (many of whose shops are owned by the same firm under different names). The design was perfected by the
Austrian architect Victor Gruen[6] All the stores rent their space from the mall owner. By mid-century, most of these were being developed as single enclosed,
climate-controlled, projects in suburban areas. The mall has had a considerable impact on the retail structure and urban development
in the United States. [7]
In addition to the enclosed malls, there are also strip malls which are 'outside' malls (in Britain they are called retail parks. These are often comprised of one or more big-box stores or superstores.
Local shops can be known as brick and mortar stores in the United States. Many shops are part of a chain: a number of similar shops with the same name selling the same products in different locations. The shops may be owned by
one company, or there may be a franchising company that has franchising agreements with the shop owners (see also restaurant chain)
Some shops sell second-hand goods. In other cases, especially in the case of a nonprofit shop, the public donates goods to the shop to be sold (see also thrift store). In give-away shops goods can be taken for free.
There are also 'consignment' shops, which are where a person can place an item in a store, and if it sells the person gives
the shop owner a percentage of the sale price. The advantage of selling an item this way is that the established shop gives
the item exposure to more potential buyers.
The term retailer is also applied where a service provider services the needs of a large number of individuals,
such as with telephone or electric power.
Retailers may use facing to create the look of a perfectly-stocked store even when it is not.
[edit] See also
