Chapter 5
? Describe
– Wheel of Retailing
– Scrambled Merchandising
– Retail Life Cycle
? Discuss Retail Strategy Evolution
? Examine Store-Based Retail Strategies
– Food-Oriented
– General Merchandise
? Location
? Operating Procedures
? Goods/Services Offered
? Pricing Tactics
? Atmospherics
? Customer Services
? Promotional Methods
? Be Price-Oriented and Cost-Efficient
? Be Upscale
? Be Convenient
? Offer Dominant Assortment
? Offer Superior Customer Service
? Be Innovative or Exclusive
? Provide A Unique Way of Operating
Low-End Strategy
? Low Prices
? Limited Facilities and Services
? Price Sensitive Consumers
Medium Strategy
? Moderate Prices
? Improved Facilities
? Broader Base of
Value- and Service-
Conscious Consumers
High-Ended Strategy
? High Prices
? Excellent Facilities
and Services
? Upscale Customers
Low-Ended Strategy High-Ended Strategy
No Services or Services Charged
at Additional Fee (or Services
May Be Limited to Credit and
Returns
Elaborate Services Available
Included in Price,Such As,
Credit Decorating
Delivery Gift Wrapping
Alterations Layaway
Spartan Fixtures and Displays Elaborate Fixtures and Displays
Simple Retail Personnel Organization Elaborate Retail Personnel
Organization
Price Emphasis in Promotion No Price Emphasis in Promotion
Self-Service or High Sales per Store
Personnel Ratio
Product Demonstrations,Low Sales
Per Store Personnel Ratio
Crowded Store Interior Spacious Store Interior
Most Merchandise Visible Most Merchandise in Backroom
Low Rental location -- Side Street High Rental Shopping Center or
Central Business District Location
Original
Merchandise
Mix
Scrambled
Merchandise
Mix
Innovation Maturity Decline
Accelerated
Development
Maturity Innovation Decline
Accelerated
Development
Number of Competitors
Very Few Very Few Moderate Many Direct Moderate Direct Moderate Indirect Many Indirect
L
Maturity Innovation Decline
Accelerated
Development
Growth/Profitability/Duration
Very Few Very Rapid Rapid Moderate to Slow Slow or Negative Low to Moderate High Moderate Very Low
3-5 Years 8 Years Indefinite Indefinite
L
Maturity Innovation Decline
Accelerated
Development
Investment/Growth/Risk Decisions
Very Few Investment Min Investment High Tightly Controlled Growth Marginal Capital High Risk to Sustain in Untapped Markets Expenditures,&
Accepted Growth Only if Necessary
L
Maturity Innovation Decline
Accelerated
Development
Central Management Concerns
Very Few Concept Refinement Establishing a Excess Capacity & Engaging in a Through Adjustment Preemptive Overstoring; Prolonging Run-Out
& Experimenting Market Position Maturity & Revising the Strategy
Business Concept
Maturity Innovation Decline
Accelerated
Development
Use of Management Control Techniques
Very Few Minimal Moderate Extensive Moderate
Maturity Innovation Decline
Accelerated
Development
Most Successful Management Style
Very Few Entrepreneurial Centralized Professional Caretaker
? Mergers
? Diversification
? Downsizing
? Cost Containment
? Value-Driven Retailing
? Convenience Store
? Conventional Supermarket
? Food-Based Superstore
? Combination Store
– Supercenter
– Hypermart
? Box (Limited-Line) Store
? Warehouse Store
? Specialty
– Category Killer
? Traditional Department
Store
? Full-Line Discount Store
? Variety Store
? Off-Price Chain
? Factory Outlet
? Membership Club
? Flea Market
? How the Wheel of Retailing,
Scrambled Merchandising,and Retail
Life Cycle Help Explain Performance
? The Evolution of Retail Strategy Mix
? The Nature of Store-Based Retailers
– Food-Oriented
– General Merchandise
Questions?