Retailing is the last stage in the distribution process. In which goods are sold to the public in small quantity for their consumption not for resale.
The transaction occurs through many different sales channels, such as online, brick-and-mortar method or through direct sales.
is the process of promoting greater sales and customer satisfaction by determining and satisfying the buyer’s wants and requirement.
In this distribution of finished products created by the business to consumers are made. That is why a retailer is a customer focused not product focused. Manufacturers may select any of distribution channel whether it is intensive, exclusive or selective. It saves time and ensures the customer will return home as fully satisfied. Retail services like hotels, parlors, restaurants etc.
Characteristics of Retailing:
- Direct interaction with customers
- Buying and selling of goods.
- Effective customer service for maximum satisfaction.
- Place, time and possession utility for different products
- maintains a variety of merchandise
- Buy and sell goods in small quantities
- Send goods to the final customers
- Efficiently manage to sell various necessary goods and services
- Display goods to attract customers
- Retailers have direct and personal contact with customers
- consumer feedback and market intelligence about products.
Functions of Retailing:
Delivery of the goods to the end consumer:
Retailer performs both functions(buying and assembling of goods. The responsibility of a retailer is to deliver the goods and services produced to the end consumer at right time and from the most economical source.
Is an essential part of the distribution chain:
Manufacturer diverts his responsibility of distribution of final goods to the retailer and he makes a full focus on the manufacturing of goods. The retailer finally distributes those goods to end consumers.
Stores the goods according to market requirement:
Retailer invests his working capital in inventory according to market requirements. Retailers know the complete demand and supply potential so he sells the requisite quantity, however small or big.
Lends a hand in manufacturer’s marketing initiative:
Retailer plans and executes many advertising and promotion activities lead to gain in popularity.
Assumes storage and credit risks:
Retailer assumes these risks while storing goods like destruction, theft, spoilage etc. so retailers have to make sufficient provisions to store it safely.
Extends credit facilities to the consumers and assumes credit risk:
A retailer does so to encourage shopping with the risk that the customers won’t pay for the goods bought or may return damaged goods.
Offers a wide variety of customers and enticing price range:
The retailer offers a wide range of merchandise at attractive prices in their stores to make maximum customer satisfaction.
Provides convenience in shopping:
Retailers set up their shops nearby housing areas or near parks, schools. Because these are the areas where the customer finds it very convenient to shop
Offers after sale services:
Activities add value to the retail transaction such as after sale services, differential packaging, giving more information about the use of a product.
Hears the voice of the market:
Retailers hear the voice of the market by consumer feedback, expectations, complaints, and by observing a shift in the tastes and preferences.
Generating employment for masses:
Retailing is human resource-centric establishments which involve stock taking, over the counter selling, packaging, after sales services, floor management etc.