Principles of Marketing - Philip Kotler


The nature and value of retail trade

What is retail? Everyone knows that the corporation "Sears" - a retail company. But what about knocking on the door "Avon lady" of the contractor, offering phone repair services at home, about the doctor attending patients of the hotel that advertises holidays at the weekend at a low price? Yes, all retailers. We determine the retail trade as follows:

Retail - any activity for the sale of goods or services directly to consumers for their personal, noncommercial use.

Any institution that is involved in this, is engaged in retail trade. And it does not matter how the goods or services are sold (by private sale, by mail, by phone or vending machine) and where they are sold (in the shop, on the street or at home by the consumer).

Retail trade - one of the largest sectors of activity in the United States. Retail stores make up approximately 25% of the total number of United States and is the third largest source of employment in the country with a staff of workers and employees of nearly 16 million. Man businesses. The structure of retail includes more than 1.5 million. Singletons and more than 340 thousand. Multipoint commercial establishments, the total turnover of which in 1981 amounted to 1 038 000 000 thousand. Doll.2

Who are the largest retailers of the country? In 1981, the ten largest retailers were a corporation "Sears Roebuck" with a turnover of $ 27.3 billion.., "Storrs Seyfuey" (16.5), "K-Mart" (16.6), "J. K. Penny "(11.8)," Kroger "(11.2)" F. W. Woolworth "(7.2)," American Storrs "(7.1)," Lucky Storrs "(7.2)," Storrs Federeyted Département "(7.0) and" A & P "(6.8 bln. dollars.) 3. The largest retail company - is primarily a network of department stores and general merchandise supermarkets network.

Whether it is selling one of the social classes and the mass market, over the years, retailers have learned the idea that they act in a rapidly changing environment. Yesterday's retail formula can not work today, and probably already do not work tomorrow. Where are the "WT Grant ", one of the oldest and largest in the country haberdashery store chains, and" Food Fair ", the eighth-largest supermarket chain? They went bankrupt. What happened to the great network of "A & P"? "" A & P "are considered before almost monopolistic colossus, vershitelnitsey fate of smaller competitors and target fighters against the trusts, now the network has become like a battered toothless lion" 4. And what happened to the "Montgomery Ward", the fourth largest chain of department stores with a mixed assortment? She's busy searching strategy to revive its former glory. Even corporations "Sears" is not all right.

In the 70 years Corporation "Sears" painfully felt the consequences of changes in the environment. Strategic installations taken by per decade since its inception in 1886, has consistently beaten the target, and in the 40s Corporation supplanted with "Montgomery Ward" leader places a corporation that was older in age. The company "Sears" made a bet on economic growth in the postwar period, and "Montgomery Ward" - to economic stagnation. "Sears' firm to justify the payment. She opened hundreds of new stores in suburbs, has upgraded its old shops, took up new activities insurance, organization of savings banks, the sale of paintings. Particularly successful corporation in the early 70s, and then decided to turn its strategic lines of the expansion of services to raise their quality level. She decided to focus on wealthy customers, adding to the range of goods and vysokokakachestvennymi even fashionable merchandise personal development. However, the time for change has been well chosen. Boom turned empty hype, and buyers did not want to pay higher prices. Instead, they began to make purchases in stores of the company "K-Mart" and other traders offering the goods at a discount. Not attracted a new approach and new wealthy buyers. In 1974, the first time in 13 years the corporation "Sears" has experienced a sharp drop in profits - by as much as 24.8%. In 1976, its profits from retail reached record levels -.. US $ 441.2 million, and then went down again - to $ 363.9 million in 1977 and US $ 330.7 million in 1978.... .5

What does the company in 80 years to restore its former position? She began to adhere to the following strategic approach: recognizing that the most stable market - a "middle-class Americans," "Sears" is no longer chasing the increasing number of wealthy buyers. Instead, the company strengthens the relationship with their current customers using credit and orient their products and services is on the market. For example, in 1981, the corporation "Sears" has acquired a company of the real estate and investment company specifically to offer their services to their clients. And another change: today, "Sears" sells in its stores and clothing brand jeans, "Levi Strauss".

The modern retailer should be closely monitored for signs of change and be prepared for the reorientation of its strategy - and sooner rather than later. However, the decision to change the strategy is not so easy to accomplish. A large retailer is often tied to their own policy settings, which management believes are "common sense." And besides, it is bound to its own public image, which is stored in the minds of consumers for a long time after the store itself has changed.

Many retail and small "family" shops. Eating small retailers play an important role for several reasons. 1. They often appear new forms of retail trade, which would later adopt and large stores. 2. They are more convenient for the consumer, because there are virtually everywhere. 3. They often have greater degree of adaptability and provide consumers a more personalized service. 4. They give consumers the opportunity to feel like masters of the situation.