CHAPTER 1

INTRODUCTION TO RETAIL
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Learning Objectives
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Defining retail
The functions of a retailer
The marketing retail equation
The significance of retail as an industry
The new role of the retailer
The global retail scenario
Key issues facing global retailers
Retail as a career

What Is Retail?
Retail derived from the French word
retailer, which means to break bulk
Retailing- last stage in the movement of
goods and services to the consumer
Retail consists of- all activities involved
in the marketing of goods and services
directly to the consumers for their
personal, family or household use

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Functions Of A Retailer
Form utility- by offering assortment of finished
goods and services in a form that customers
want
Time utility- by keeping the store open when
the consumers prefer to shop
Place utility-by being available at a convenient
location
Ownership utility- by selling the product
Serves the manufacturer- by distributing the
goods to the end consumer

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The Marketing Retail
Equation
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Manufacturer
Retailer
Consumer
Manufacturer
Consumer
Manufacturer
Wholesaler
Retailer
Consumer
F
e
e
d
b
a
c
k

The Changing Retail
Landscape
Proximity to the customer
The Rise of consumerism
Introduction of the Private Label
Technology

Retailers are no longer dependent on the manufacturers
to sell what is available and have emerged as the new
leaders in the marketing channel
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The Global Retail Market
Key challenges
Emergence of new markets
Empowered consumer
Technology enabled efficiencies
Rise of the E-age
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Key Players In The World Of Retail
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Fortune
Rank 2007

Company Revenues ($
Mln)
Profits ($ Mln)
1 Wal-Mart Stores 351,139 11,284
32 Carrefour 99,014.7 2,846.2
44 Home Depot 90,837.0 5,761
55 Tesco 79,978.8 3,544.9
62 Metro 75,131 1,324.9
80 Kroger 66,111.2 1,114.9
94 Costco Wholesale 60,151.2 1,103.2
104 Royal Ahold 56,944.9 1,127.9
114 Sears Holdings 53,012 1,490
129 Walgreen 47,409 1,750
Most Active Emerging Retail Markets
Rank Country Proportion of respondents
that are actively looking in
each market or first opened
there in 2007
1 India 27%
2 Ukraine 24%
3 Russia 22%
4 Malaysia 19%
5 Turkey 13%
6 South Africa 12%
7 Thailand 11%
8 China 10%
9 Mexico 8%
10 Indonesia 6%
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Retail 2010: Things To Come
Key role of technology
Agility in response and integration within the
organisation
Competitive and cost advantages in retailers lines of
business
In the light of environmental changes, retailers to rethink
their competitive strategies
Internet as a powerful channel of distribution
Mobile commerce- a reality
Lifestyle retailing

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Ten Trends In Global Retailing
1. Social responsibility
2. Global consumer growth shifts away from the US
3. Commoditisation run amok
4. The rise of long tail retailing
5. The fight to plant the flag in India
6. Retail investment in services
7. Emerging market investment in developed retailers
8. Multi-channel integration
9. Focus on customer experience
10. Retailers as world-class marketers
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Retail As A Career
Buying & Merchandising
Marketing
Store Operations
Sales
Finance
Human Resources
Technology & e-commerce
Visual Merchandising
Supply Chain Management & Logistics

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