Unit-1:

Retail:
• Retail refers to selling goods or services to an end user. Retailers buy goods from
wholesalers, manufacturers, or other retailers and then sell them to consumers for a
profit. In other words, retail is the direct selling of goods and services to a consumer
• A retailer is a person or business that you purchase goods from. Retailers typically don't
manufacture their own items. They purchase goods from a manufacturer or a
wholesaler and sell these goods to consumers in small quantities.

Retail store
• A retail store is a physical or virtual establishment where businesses offer a selection of
products or services directly to consumers for purchase. Retail stores, also known simply
as “retailers” or “shops,” are physical establishments where products or services are
sold directly to consumers.
Retail Store Examples
• Examples of retail stores and their store types are:
• Walmart is a retail store and falls under the grocery store type
• CVS is a retail store and falls under the health & personal care stores type, and the sub-
type of “pharmacies”
• Sephora is a retail stores that also falls under health & personal case stores type, but
under the sub-type of cosmetics, beauty supplies & perfume stores”

Types of stores
Department Stores
Specialty Stores
Retail outlets/chain stores
Discount Stores
Supermarkets
Convenience Stores
Pop-Up Stores
Franchises
Malls and Shopping Centers

Department Stores
Department stores are the grand dames of the retail world, offering a wide
array of products under one roof. These retail emporiums are known for their
vast selection, encompassing clothing, accessories, home goods, electronics,
and even cosmetics. Renowned for their upscale ambiance and exceptional
customer service, department stores provide a premium shopping experience
for discerning clientele
Specialty Stores
Specialty stores focus on a narrow range of products but excel in depth and
expertise. Whether it’s high-end fashion, gourmet foods, or niche hobbies like
model trains, these stores are the go-to destinations for enthusiasts
seeking specialized goods and personalized service. The staff’s deep knowledge
and passion for their products create an engaging shopping atmosphere.

Chain Stores
Chain stores, synonymous with consistency and ubiquity, are part of a network
of retail outlets operating under the same brand. These stores offer a
standardized shopping experience across multiple locations, providing
customers with a sense of familiarity and reliability. From multinational giants
to regional favorites, chain stores play a pivotal role in the retail landscape.

Discount Stores
Discount stores cater to budget-conscious shoppers seeking value without
compromising quality. These stores offer a wide variety of products, often from
well-known brands, at significantly reduced prices. From clothing and
electronics to household essentials, discount stores are a treasure trove for
savvy consumers looking to stretch their dollars.

Supermarkets
Supermarkets are the backbone of everyday shopping, providing a
comprehensive selection of groceries, household items, and often, a variety of
non-food products. With their expansive aisles and organized layouts,
supermarkets aim to streamline the shopping experience, making it easy for
customers to find everything they need in one location.

Convenience Stores
Convenience stores are the lifelines for those seeking quick, on-the-go
purchases. Often open 24/7, these compact establishments stock essential
items like snacks, beverages, toiletries, and sometimes even basic household
goods. Convenience stores prioritize accessibility and efficiency, making them
indispensable in our fast-paced lives.

Pop-Up Stores
Pop-up stores are temporary retail setups that materialize for a short period,
often during special events or holidays. These stores generate excitement and
urgency, offering limited-time products or experience
Franchises
Franchises operate under a proven business model, offering products and
services consistent with the parent company’s brand. These retail
establishments provide a blend of familiarity and localized service, making
them a popular choice for entrepreneurs looking to enter the retail market.

Malls and Shopping Centers

Malls and shopping centers are bustling hubs housing a diverse array of retail
stores, entertainment venues, and dining options. These sprawling complexes
offer a one-stop shopping experience, creating a vibrant atmosphere for
shoppers to explore a multitude of brands and products.

Retail operations
• Retail operations generally refer to the daily business activities of a retail
business, which is a business that sells products directly to consumers.
These activities, or operations, range from choosing and buying products
for the store to accepting payment for the product from consumers and
everything in between.
• Retail operations is a set of processes and activities involved in the
management of a retail business, including the design and layout of stores,
the selection and sourcing of products to sell, the management of inventory
levels and supply chain logistics, the execution of sales and marketing
strategies, and the provision of excellent customer service.
• Retail operations play a critical role in the success of a retail business.

Functions
Here are some key reasons why retail functions are essential:
1. Maximizing Sales: It can help a business maximize sales by optimizing the
store layout and
ensuring the availability of products.
2. Improving Customer Satisfaction: It can significantly impact customer
satisfaction, leading to customer loyalty and repeat business. Companies can
build a loyal customer base by creating a welcoming and positive shopping
experience and managing inventory levels effectively.
3. Streamlining Processes: It can help businesses streamline their processes,
reducing costs and improving productivity. For example, companies can
improve their bottom line by optimizing supply chain processes, minimizing
waste, and controlling labor costs.
4. Enhancing Brand Image: It is essential for creating and maintaining a positive
brand image. In this way, businesses can improve their brand image and attract
more customers by providing high quality products, delivering excellent
customer service and memorable shopping experience.
5. Responding to Changing Market Conditions: It can help businesses respond
quickly to changing market conditions, like changes in customer preferences or
fluctuations in demand. The retail operations manager can adjust their
operations to meet changing market conditions and stay competitive.

5S of Retail Operations:
1. Sort: The first step is sorting and organizing all store or warehouse items.
This involves removing any items that are not needed, disposing of or
donating items that are damaged or obsolete, and grouping similar items
together.
2. Set in Order: Once all items are sorted, the next step is to set them in order.
This involves retail operations specialists determining the most efficient and
effective layout for the store or warehouse, grouping items by type or
category, and labeling and assigning locations for each item.
3. Shine: The shine step involves thoroughly cleaning and maintaining the
store or warehouse to ensure a safe and pleasant environment for
customers and employees. This includes sweeping floors, dusting shelves,
and maintaining equipment.
4. Standardize: Once the store or warehouse is organized and clean, the next
step is establishing standard procedures and guidelines for maintaining this
state. This involves creating policies for storing and labeling items,
scheduling regular cleaning and maintenance, and training employees on
proper techniques.
5. Sustain: The final step in retail operations jobs is to sustain the
improvements made by continuously monitoring and maintaining the
system. This involves regular audits and reviews to ensure that the store or
warehouse still functions efficiently, addresses issues, and constantly
improves processes and procedures.

Elements Of Retail Operations/Components /types

Physical Store Layout
Logistics
Inventory
Customer Service
Mode Of Payment
Return/Exchange Request
Physical Store Layout
Retail operations include the store’s layout for brick-and-mortar retail
businesses. Businesses use shelves, display cases, and aisles to make products
easier to find. It becomes easy for the consumer to choose the product
without help and make quick decisions.
Logistics
Logistics in retail refers to transporting goods between production sites,
storage facilities, and retail & customer locations. Retail operations specialists
may consider multiple modes of transportation, such as trucks, planes and
trains, to develop a transport strategy that satisfies customer expectations &
saves logistics costs.
Inventory
Retail operations staff may exhibit a portion of their goods in the store’s main
area while keeping excess items in a back room to avoid clutter. Retail store
managers frequently keep most of the stock in a warehouse and schedule
regular delivery to the store and customers accordingly.
Customer Service
Good customer service plays a vital role in attracting customers by providing
them with a delightful and exceptional customer experience. Also, promotional
offers and freebies help. Personalisation may also have a significant impact on
future client retention. A higher customer lifetime value is the outcome of a
higher retention rate.
Mode Of Payment
Customers may have a variety of payment alternatives in both offline and
online stores. Exploring different payment methods, such as credit cards,
mobile payment applications, and gift cards can help retail operations experts
make the purchase process quick and easy for customers.
Return/Exchange Request
Customers may return to the store to exchange a product for another if they
need it in a different size or colour or for multiple other reasons. Retail
operation staff assists consumers in getting the correct item or making a
refund request if the customer requirement is not fulfilled.

Store Manager
• A store manager works in a retail environment, managing both the store
and staff to increase profitability, deliver great customer service, and keep
products on the shelves.
Store Manager responsibilities and duties
• Manage store operational requirements by scheduling and assigning
employees
• Recruit, select, orient and train employees
• Maintain results by coaching, counseling and disciplining employees
• Prepare annual budget, schedule expenditure, analyze variances and
initiate corrective actions
• Identify current and future customer requirements by establishing
rapport with potential and existing customers
• Ensure availability of merchandise and marketing products in store
• Secure merchandise by implementing security systems and measures
• Protect employees and customers by providing a safe and clean store
environment
• Maintain the stability and reputation of the store by complying with
legal requirements
• Provide training to improve the knowledge base of the staff and use
cross-training methods to maintain productivity when employees are
absent
• Manage all controllable costs to keep operations profitable
• Manage stock levels and make key decisions about inventory control
• Analyze sales figures, forecast future sales and interpret trends to
facilitate planning
• Ensure standards for quality, customer service, and health and safety
are met
• Respond to customer complaints and comments
• Organize special promotions, displays and events
• Update colleagues on business performance, new initiatives, and
other pertinent issues
• Maintain awareness of market trends in the retail industry,
understanding forthcoming customer initiatives and monitoring what
local competitors are doing
• Initiate changes to improve the business, e.g. revising opening hours
to ensure the store can compete effectively in the local market.
•
Store Manager required skills and knowledge
• Have at least five years' experience in retail and one year experience
in leadership
• Are able to motivate a team, delegate work fairly, and contribute as a
team player
• Have a relentless commitment to delivering customer service
excellence and building strong customer relationships
• Can show knowledge of budgeting, marketing, strategic planning, and
vendor relationship management
• Have sound knowledge of technology products and the current retail
environment
• Consistently deliver results and have first-class sales skills
• Are highly organized and able to communicate well both verbally and
in writing
• Have a bachelor's degree in any subject

Store administration
• Store administration deals with various aspects, like the cleanliness of the
• store. premises, maintenance of the store facade and the display windows etc.
• An Administration is also responsible for utilizing the store personnel effectively. Time
keeping for the store staff is important.
• Store administration deals with various aspects which are necessary to sell
the goods to clients without any disruption. It includes cleanliness of the
whole store particularly the main floor, maintenance the store facade and
the displayed windows, etc.
• A store administrator, sometimes referred to as a store manager, is
• person whose duties are to oversee the daily operations of a retail store. In a
this career, you provide customer assistance, lead job training, monitor
inventory, and make performance assessments of employees and sales.
• Store Premises means the lot area maintained and managed by the
• business that may include the building, parking lot and adjacent walkways,
and where the business' shopping carts are permitted.
A) working hours, duration of Business hours, opening and closing
responsibilities
Ex: Life styles store can open late and grocery, supermarket need to open
early, free standing stores can operate choice hrs. while mall store follow
organized hrs.
B) Maintained and cleanliness store façade and display windows
C) Managing required permissions and licenses
D) Space through Plan answering questions like:
1. 1.what items and categories and department should be carried
2. 2 how much item should be carried
3. 3 How much space should be taken.
Store Management and components
Store management involves operating and monitoring all aspects of a retail or
wholesale store. This means working with employees, suppliers and
customers. Effectively managing a store can boost sales and improve the
customer experience. This role involves many retail elements, including
inventory, sales and marketing.
Inventory management
Store layout
Sales
Marketing
Customer service
Employee management
Health and safety

• Inventory management includes recording ordered, received, returned,

issued or sold goods. Optimising the inventory helps control costs while
ensuring items remain within the preset minimum and maximum stock
levels.
• An effective store layout can maximise shelf space and make it easier for
both employees and customers to find the items they want. Optimising
displays can increase customer awareness of special offers or a new
product range.
• A store manager's responsibilities include selling products and services. The
ability to sell and up-sell is important for assisting customers, training new
employees and helping current employees improve their sales skills. Store
managers constantly seek new ways to increase sales and meet customer
demands. They may set daily or weekly sales targets based on previous
periods, which can help them identify customers' shopping habits and
market trends.
• Store managers often promote new products through marketing. This may
be in-house, using creative product displays, promotions, demonstrations
or sampling. A brand's own promotions staff often conduct demonstrations
or sampling in retail stores. A store manager may also design social media
or email marketing campaigns to publicise special offers or attract new
customers.
• One of the most important aspects of managing a store is ensuring that
customers receive exceptional service and feel valued. This may involve
dealing with queries or resolving complaints. Satisfied customers become
repeat buyers and often evolve into ambassadors for the store you work
for.
• A store manager's responsibility includes recruiting, training and supervising
the right employees for the role. They design shift schedules and assign
responsibilities. Managers support all employees, encourage a proper work
ethic and ensure the sales team provides outstanding customer service.
• Managers are responsible for creating a comfortable and safe environment
for both customers and employees. They usually have a comprehensive
understanding of health and safety regulations and industry best practices.
They assess activities and inspect the premises to identify potential risks or
hazards.

Retail organization structure

• Organization is the process of identifying and grouping the work to be
performed, defining and delegating responsibility and authority and
establishing relationships for the purpose of enabling people to work most
effectively together in accomplishing objectives.
• Organizational structure refers to the way that an organization arranges
people and jobs so that its work can be performed and its goals can be met.
When a work group is very small and face-to-face communication is
frequent, formal structure may be unnecessary, but in a larger organization
decisions have to be made about the delegation of various tasks. Thus,
procedures are established that assign responsibilities for various functions.
It is these decisions that determine the organizational structure.
• Retail stores rely on an organizational structure which focuses on three
areas: centralized operations, store operations, and regional operations.

Retail organization structure:

• Single store retail structure: It is a smaller scale of organizational structure
compared to other.
• Diversified retail structure: It provide product or services that are
completely unrelated to what is being sold or offered in their other stores.
• National chain retail structure: A large department store may have a
complete staff consisting of a manager, assistant manager and other
department.
• Executive
• Finance
• Operations and sales.
Organization structure
One way to categorize retailers is by their ownership structure. There are five
primary ownership types within the retail industry:
1.Corporate chain
2.Independent
3.Wholesaler
4.Franchise
5.Co-op

Corporate chain
Corporate chains generally have multiple stores, central ownership, and
consistent standards for execution. Some national chains have multiple
regional banners under which they operate their stores.
For example, The Kroger Company operates Kroger stores, but it also operates
under different names in different states: Dillons Food Stores (Kansas), Fred
Meyer (Oregon, Washington, Idaho, and Alaska),
Fry’s Food & Drug (Arizona), King Sooper (Colorado), Ralph’s
(Southern California), Roundy’s (Wisconsin and Illinois) and many others.
Despite acquisition by The Kroger Company and later standardization, these
stores have retained their names to maintain a connection with their history
and local communities.

Independent store
As the name implies, independent stores are independently owned and
operated. Owners may have multiple stores and operate similarly, but they do
not benefit from the significant scale. Because of their size, independent stores
buy product through wholesalers, which apply an upcharge (typically 6%) for
warehousing and handling product. This means that independent stores are
buying their goods at slightly higher costs than corporate chains get with direct
buying. Thus, independent stores are not generally able to compete with lower
prices. Instead, they may market themselves as “local,” advertising their place
in the community and customizing their product assortment to reflect local
tastes, brands, or customs.

Wholesaler
As noted above, wholesalers are product distributors focused primarily on
supply chain and logistics. However, some wholesalers also own stores and/or
license their store brands to independent stores as part of franchise
agreements. Those agreements often include clauses saying that the
wholesaler will be the exclusive supplier of the independent store.
 SuperValu Inc. is a prime example of this type of agreement, as they have
corporate stores and serve franchised stores under several names, including
Cub and Shoppers.

Franchise
To the consumer, a franchise may look like a corporate chain, as the marketing
and available products is usually consistent between franchise stores. The key
difference is that while corporate chains are centrally owned, franchise stores
are owned by individual business owners who have contracted with a larger
company. In exchange for paying a royalty fee for the larger company’s
trademark, training fees, and a percentage of
sales, a franchise owner can run a store under a larger company’s brand,
thus tapping into that company’s customer base. This model is particularly
common for large restaurant companies—for example, most Subway and
McDonald’s stores are franchises. Convenience stores often also follow this
model. Popular convenience store franchises include 7-Eleven and Casey’s
General Store.

Co-op
Co-ops occur when several independent retailers join together to consolidate
their purchases. This increases their buying power and might result in lower
costs from manufacturers and growers. Typically, each member of the co-op
has an equal voting right, regardless of the number of stores they own or the
size of their business. Co-op members may also work together to purchase
advertising and store infrastructure like shelving or software. Wakefern, which
operates Shop-Rite stores in New Jersey, is a notable co-op.
Single-Store
A single-store retailer has a smaller scale of organizational structure in
comparison to national chains and diversified retailers. The typical structure
for a single-store retailer may consist of the owner performing CEO and
manager duties or even a cashier stocking merchandise because the inventory
as well as the profit margins are smaller so there is significantly less need for
these types of individual employees. “A small specialty shop
may have all of its employees under one category called Store Operations. . . .
Even if you only have a small staff, everyone should be tasked with specific
duties, so that things don’t fall through the cracks.”[1]
Many national chains and diversified retailers start out as single-store retailers.
One such national chain was Wal-Mart. “On July 2, 1962, Sam Walton opened
the first Wal-Mart store in Rogers, Arkansas. Sam’s competitors thought his
idea that a successful business could be built around offering lower prices and
great service would never work. As it
turned out, the company’s success exceeded even Sam’s expectations.”[2] Wal-
Mart’s ultimate success provided for international expansion eventually
leading to the single- store retail business becoming a national chain and even
building stores in other countries such as Canada and Mexico.

What is a Departmental Store?

A departmental store is a large retail establishment that offers a wide
range of products under one roof, organized into various sections or
departments. Each department typically specializes in a specific
category of products, such as clothing, electronics, groceries, or home
furnishings.
The concept of a departmental store is to provide customers with the
convenience of finding diverse products in a single location, thus
saving time and effort.

Features of Departmental Stores

• Wide Range of Products: Departmental stores offer a vast array of
products, catering to different consumer needs and preferences.
• Specialized Departments: Each department focuses on a specific
category, ensuring a variety of options within that category.
• Customer Service: These stores often provide additional services
like product demonstrations, after-sales service, and personalized
shopping assistance.
• Large Physical Space: Departmental stores typically occupy
substantial physical spaces, often spread over multiple floors.

Types of Departmental Stores

Departmental stores come in various formats, each catering to distinct
consumer needs and market niches. Here are some types with real-life
examples:

Traditional Department Stores

Example: Shoppers stop in India.
These stores offer an extensive range of products, including apparel,
cosmetics, and home furnishings. Shoppers Stop, for example, is
renowned for its wide brand assortment and quality products, making
it a favored choice for consumers seeking a blend of tradition and
modernity. Its focus on customer service, product variety, and a
premium shopping environment sets it apart in the retail landscape.
Discount Department Stores
Example: Big Bazaar.
Focused on value and affordability, these stores offer products at
discounted prices. Big Bazaar has revolutionized this concept in India
by combining the supermarket and department store models, providing
an affordable shopping experience without compromising on variety. It
caters to budget-conscious consumers, offering a range of products
from groceries to apparel.

Specialist Department Stores

Example: Hamleys for toys
These stores specialize in a specific product category. Hamleys, an
iconic toy store, offers an extensive range of toys and games, creating
an enchanting shopping experience for children and a targeted
destination for parents. Its focus on a single category allows for depth
and expertise in product offerings.

Hypermarkets and Supermarkets

Example: Reliance Mart.
These establishments blend the supermarket and department store
formats, offering a wide range of groceries alongside electronics,
clothing, and household items. Reliance Mart exemplifies this format in
India, catering to everyday needs with a diverse product range, making
it a one-stop-shop for a wide clientele.

Advantages of Departmental Stores

1. Convenience
The primary advantage of departmental stores is the convenience they
offer. Shoppers can find a wide variety of products under one roof,
reducing the need to visit multiple stores. This saves time and effort,
making the shopping experience more enjoyable.
2. Variety of Products Departmental stores provide a broad
selection of products across different categories. This variety ensures
that consumers have ample choices, catering to diverse tastes and
preferences. Shoppers can compare products and brands within the
same category to make informed decisions.
3. Competitive Pricing Due to their large scale of operations,
departmental stores can negotiate better deals with suppliers, often
passing on these savings to customers. This results in competitive
pricing, making products more affordable for consumers.
4.Quality Assurance
Reputable departmental stores prioritize quality assurance, ensuring
that the products they sell meet certain standards. This builds
consumer trust and loyalty, as shoppers feel confident about the
quality of their purchases.
5.Customer Service Departmental stores often provide excellent
customer service, with knowledgeable staff available to assist
shoppers. Many stores offer additional services like product
demonstrations, after-sales support, and personalized shopping
assistance, enhancing the overall shopping experience.
6.Promotions and Discounts Departmental stores frequently run
promotions and offer discounts on various products. These deals
attract customers and provide an opportunity to purchase items at
lower prices. Seasonal sales, clearance events, and loyalty programs
further add to the shopping benefits.

Disadvantages of Departmental Stores

Higher Operating Costs Departmental stores have higher operating

costs compared to smaller retail outlets. These costs include rent,
utilities, staff salaries, and inventory management. These expenses
can sometimes be passed on to consumers in the form of higher prices.
2.Crowded Shopping Environment During peak shopping times,
departmental stores can become crowded, leading to long checkout
lines and a less pleasant shopping experience. This can be particularly
challenging during sales events and holiday seasons.
3.Limited Personalized Service While departmental stores offer good
customer service, the large scale of operations can limit the level of
personalized attention each customer receives. Smaller specialty
stores may provide a more personalized shopping experience, catering
to individual customer needs more effectively.
4.Impacts on Small Retailers The dominance of departmental stores
can negatively impact small, independent retailers. These smaller
businesses may struggle to compete with the extensive product range,
lower prices, and marketing power of larger stores, leading to reduced
sales and potential closures.
Environmental Impact
The large scale of operations in departmental stores can have
significant environmental impacts. High energy consumption, waste
generation, and transportation of goods contribute to environmental
concerns. Sustainable practices are necessary to mitigate these
effects.
7. Impulsive Buying The extensive product range and attractive
displays in departmental stores can lead to impulsive buying.
Consumers may purchase items they do not need, leading to
unnecessary spending and potential financial strain.
8. Security Concerns Large departmental stores are sometimes
targeted by shoplifters due to the high volume of goods and large
customer base. Ensuring security within the store can be challenging
and may require significant resources.

Chain of stores
• Chain store, any of two or more retail stores having the same
ownership and selling the same lines of goods. Chain stores account
for an important segment of retailing operations in the Americas,
western Europe, and Japan. Together with the department store and
the mail-order company, chain stores represent the first successful
application of large-scale integrated methods to a form of retailing.
• A chain store is a retail store that is part of a larger organization
that owns several other retail locations, all of which share the
same branding, standards and product lines. Stores that belong
to the chain can either be directly operated by the main
organization that owns the brand, or they can be franchised to
other operators.
• Chain stores are also known as “Formula Retail”
• Other examples of chain stores include:
Walmart
Target
Home Depot