Types of Retailers

INTRODUCTION – TYPES OF RETAILERS

Consumers today can shop for goods and services in a wide variety of retail organizations. There are store retailers, nonstore retailers, and retail organization.

1. SUPERMARKETS – RETAILERS
   

These are large self-service stores traditionally selling food, drinks and toiletries, but range broadening by some supermarket chains means that such items as non-prescription pharmaceuticals, cosmetics, and clothing are also being sold. While one attraction of supermarkets is their lower prices compared with small independent grocery shops, the extent to which price is a key competitive weapon depends upon the supermarket’s positioning strategy.

2. DEPARTMENT STORES – RETAILERS
   

So-called because related product lines are sold in separate departments such as men’s and women’s clothing, jewelry, cosmetics, toys, and home furnishings, in recent years department stores have been under increasing pressure from discount houses, specialty stores and the move to out-of-town shopping. Nevertheless, they are still surviving in this competitive arena.

3. SPECIALITY SHOP – RETAILERS
   

These outlets specialize in a narrow product line. For example, many town centers have shops selling confectionery, cigarettes and newspapers in the same outlet. May speciality outlets sell only one product line such as Tie Rack and Sock Shop. Specialization allows a deep product line to be sold in restricted shops space. Some speciality shops focus on quality and personal services such as butchers and greengrocers.

4. DISCOUNT HOUSES- RETAILERS
   

These sell products at low prices by bulk buying, accepting low margins and selling high volumes. Low prices, sometimes promoted as sale prices, are offered throughout the year. As an executive of Dixons, a UK discounter of electrical goods, commented we only have two sales each lasting six months. Many discounters operate from out-of-town retail warehouses with the capacity of stock a wide range of merchandize.

5. CATEGORY RETAILERS KILLERS

These are retail outlets with a narrow product focus but with an unusually wide width and depth to that product range. Category killers emerged in the USA in the early 1980s as a challenge to discount houses. They are distinct from speciality shops in that they are bigger and carry a wider and deeper range of products within their chosen product category, and are distinguished from discount houses in their focus on only one product category.

Two examples of the category killer are Toys “R” Us and Nevada Bob’s Discount Golf warehouses, e-marketing 20.1 discusses how Toys “R” Us operates and gains competitive advantage over traditional toy outlets, while facing a major threat from a new internet – based competitor eToys.

6. CONVENIENCE RETAILERS STORES

These stores offer customer the convenience of close location and long opening hours every day of the week. Because they are small they pay higher prices for their merchandise than supermarkets, and therefore have to charge higher prices to their customers. Some of these stores join buying groups such as spar or mace to gain some purchasing power and lower prices. But the main customer need that they fulfill is for top-up buying, for example when short of a carton of milk or loaf of bread. Although average purchase value is low, convenience stores prosper because of their higher prices and low staff costs, many are family businesses.

7. CATALOGUE STORES

These retail outlets promote their products through catalogues which are either posted or are available in the store for customers to take home. Purchase is in city center outlets where customers fill in order forms, pay for the goods and then collect them from a designated place in the store. In the UK, Argos is a successful catalogue retailer selling a wide range of discounted products such as electrical goods, jewelry, gardening tools, furniture, toys, car accessories, sports goods, luggage, and cutlery.