It can be argued that most people are quite familiar with the term ‘Retail’, or have at least heard about it at some point in their lives. Whether the prototype that comes to mind is a local corner grocery store or a large scale international supermarket, the main function is generally the same, that is, conveniently assembling various essential goods and services in one place. Though this view of the function of retailing acknowledges the basics, the scope and nature of the sector go beyond this.
The word ‘retail’ is derived from the Old French word ‘ ‘, which means “to cut or divide” in terms of tailoring. It was first recorded as a noun with the meaning of a “sale in small quantities” in 1433. Over the years this has evolved to represent the very act of breaking bulk for sale.
The most basic definition of retailing is that; it is the buying and selling of goods and services. To be more precise, it is the buying and re-selling of goods (and services), usually to the end/ final user with a goal of earning some profit from it. A typical, simplified retail value chain would start off with a producer/ manufacturer, wholesaler, retailer and lastly, the customer. Though this has since evolved to become more and more complex, the notion that retailing demands direct interface with the customer on whichever platform still remains.
Typical Retail Supply Chain
Manufacturer/ Producer…………….(wholesaler)…………..Retailer…………….End User (customer)
Types of retail outlets/ operations
Hypermarkets: these are superstores that combine a supermarket and a department store. The result is an expansive retail facility carrying a wide range of products under one roof, including full groceries lines and general merchandise
Minimarts/ convenience stores: these are small retail businesses that stock a range of everyday / basic items such as groceries, confectionery, soft drinks, over-the-counter drugs, health and beauty aids, newspapers, and magazines.
Department stores: these are large retail establishment offering a wide range of consumer goods in different product categories organized into separate departments. All departments are housed under the same roof to facilitate buying, customer service, merchandising, and control.
Supermarkets: these are self-service shops that offer a wide range of food/ non-food and household products, organized into aisles. One would also probably find an assortment of the following goods in a supermarket; meat, fresh produce, dairy, and confectionary, kitchenware, household appliances and over-the-counter pharmaceutical products. Of late, supermarkets have also started offering a number of services, allowing customers to transact on various platforms.
There are other types of retail outlets out there, but in an effort to give a basic understanding and appreciation of the industry, supermarkets will be used as a prototype. Thus, articles to follow will focus on the following areas of the retail industry;
- procurement
- inventory management
- customer service
- administration
- daily operations
- staffing
