What is Retail?
Retail is the generic term for any business activity in which merchandise or supplies are sold to customers either through physical stores, internet, or other modes. Retail is the commercial activity related to sale of tangible items to consumers. It is the most profitable sector of the retail market.
Retail is a complex process of selling consumer products or services directly to consumers through multiple outlets of distribution to make a profit. Retailers meet demand identified via a supply chain. The supply chain contains three stages: product development, retail establishment and customer satisfaction. Retailers work with manufacturers to produce, package and deliver goods to the ultimate consumers. A retailer may sell new products directly to the end users who make purchases on the internet or visit the retail store.
In addition, some retailers sell pre-owned merchandise. In some countries, retailers operate retail stores, whereas, in others, they may be brokers who deal directly with the manufacturers. In most developed countries, retailers provide a large part of the overall merchandise sales to wholesalers who in turn ship the merchandise to the final consumers. Some retailers also sell to other small businesses through direct sales channels.
The modern retail industry comprises both brick-and-mortar stores as well as online retail businesses. Online retail businesses include internet-based chain of stores, specialty stores or portals that sell directly to the public and also carry an inventory of their own. They have a virtual location through which consumers can purchase merchandise from the retailers.
There are different types of retailing: single-brand retailing wherein the only brand of a product that is sold is the one manufactured by the retailer; double-brand retailing wherein a second manufacturer supplies goods of a different name to the same retail establishment; and multi-brand retailing, wherein different brands of the same product are supplied by different manufacturers at the same establishment. The type of retailing to be adopted will depend on the business and profitability of the retail establishment. Many small enterprises retail only a few products, while large multinational corporations retail thousands of products. Retailers also often diversify their offerings by offering not only branded but also non-branded merchandise, which is gaining popularity as more people are becoming conscious of the fact that they are contributing to the atmosphere of the planet by buying green and eco-friendly products.
A major objective of retailing is to create and maintain customer satisfaction. The success of a retail business is dependent on the satisfaction of the customers. Many retailers create market surveys and questionnaires to find out what kind of merchandise are most in demand by the customers, and then they take steps to incorporate these findings into their strategies. These strategies are implemented into their production process as well as into their marketing and selling approach to ensure customer satisfaction. This, in turn, assures the success of the entire retailing operation.