Store Planning

Design & Layout, Location Planning and its importance, retailing image
mix, Effective Retail Space Management, Floor Space Management.
Retail Marketing: Advertising & Sales Promotion, Store Positioning,
Retail Marketing. Mix. Retail Location- Meaning, Importance, Process
and Factors Affecting Location.
Retail Location
What is a retail location?

A retail location is the place a business sells goods in person. From

traditional freestanding brick-and-mortar stores to mall space, the best
retail location is in a high-traffic area where your potential customers
are known to shop.
Competition for retail space is fierce. In 2022, US retailers
opened twice as many stores as they closed, with the average vacancy
rate sitting at just 4.6%. It takes work to find the right location at the
right price. But carefully evaluating the best home for your next store
will pay dividends in the long run.
The importance of retail location

Foot traffic
The more people you have visiting your store, the higher your chances
are of generating revenue.
Your retail store location plays a large role in this. Areas known to have
high footfall could allow you to ease off on local marketing and heavy
retail signage. An attractive window display has the potential to pull in
passersby who weren't otherwise thinking of visiting.
The importance of retail location

Community engagement
The COVID-19 pandemic shook up the way consumers engage with
brands. One of the most notable shifts was toward localism—preferring
and buying from nearby brands that support the local community.
Some retail locations have a greater sense of community than others.
For example, independent stores in downtown areas are likely to have
more local engagement than big-box retailers in busy malls.
The importance of retail location

Supply chain implications

A retail location isn’t just a space to meet new customers. Use
the stockroom inside your new location as a storage and fulfillment hub.
Importance of location decision in retailing
The importance of location decisions is high due to the following factors:
1) Location choice is a major cost factor.
2) It involves large capital investment (the high cost of land or building if it is being
purchased of recurring cost of rent if it is leased).
3) It affects the transportation cost structure (Distance from the manufacturer,
distributor etc. affects the total cost of transportation).
4) It has a significant bearing on human resources cost (if the retail store is located
away from central locations i.e. areas where public transport is weak the cost of
employees will be higher as employees will have to be provided with
transportation or paid for transport).
5) It is dependable on the quantum of customer traffic (depending on the number
of consumers who frequent the area).
6) It affects the volume of business (if the number of customers visiting the store
are low then the volume of business done by the retail store is obviously
affected)
Types of retail store locations

Brick and mortar retail

Mall space

Shopping centers

Business parks

Downtown

Home-based
Brick and mortar retail

Brick-and-mortar retail is the most traditional type of physical location. Also known as freestanding or
anchor stores, it’s a type of building used by retailers to connect with customers in their own
premises.
Pros of brick-and-mortar stores
• Rent is cheaper. Busy shopping malls can charge a premium to retailers looking to tap into their
existing foot traffic. Out-of-town landlords don’t have that luxury, so rent can be much cheaper.
• They’re more accessible. Brick-and-mortar stores can be situated out-of-town but on a public road.
Proximity to public transport (such as bus stops) and cheaper parking makes this location more
accessible.
• Some customers prefer them. Research shows that 27% of shoppers buy holiday gifts in local
independent stores, beating traditional department stores or specialist merchants.
Cons of brick-and-mortar stores
• Zoning rules apply. Cities, towns, or village governments often set zoning regulations on how
buildings in any given area can be used. Any building that falls within a residential zone is unlikely
to get approval for becoming a retail shop.
• Foot traffic can be nonexistent. Expect to invest heavily in local marketing, advertising,
and signage that guides potential customers toward your store.
Mall space

A shopping mall is a place where customers come to shop. Usually spanning millions of square feet, they
feature numerous stores—from big-box retailers to independent stores—all under one roof.

Pros of mall space

• High foot traffic. With some malls recording upwards of 20 million visitors per year, your business
could be exposed to thousands of shoppers on a weekly basis—all without excessive advertising.
• Co-marketing opportunities. The owner of a mall rarely has any inventory to sell, so owners promote
their retailer’s inventory to drive foot traffic.
• It’s secure. Malls often have 24/7 security to protect the millions of dollars’ worth of merchandise
stored inside.

Cons of mall space

• Rent is expensive. Malls often charge premium prices for the exposure they give to retailers.
• Competition is fierce. Leading shopping malls span more than two million square feet. There’s a good
chance your direct competitors will be in the same building, fighting for your target customer’s
attention.
• They can be inconvenient for one-off trips. If someone is making a special trip solely to your store,
the hassle of visiting a busy shopping mall can be off-putting.
Shopping centers

A shopping center is a busy building where people come solely to shop. Also known as a
strip mall, it can have up to 20 physical stores—including restaurants—situated in a single
area.
Pros of shopping centers
• Foot traffic. Smaller than a mall, shopping centers still have a steady flow of potential
customers that could stop by your store.
• Range of customers. Shopping centers often house grocery stores and restaurants—both
of which attract a wide customer base. That can be beneficial for stores that sell widely
used products.
• They’re accessible. Public transportation often runs to and from shopping centers.
Cons of shopping centers
• Additional fees. Unlike malls, shopping centers often add the cost of security, parking, and
building maintenance onto your retail lease.
• Parking can be hit and miss. On a busy day, parking spaces can fill up fast; some
shopping center managers require each store to reserve its own customer parking spaces.
Business parks

A business park is an area often used as headquarters for businesses. On some, you’ll find
industrial plants and warehouses. But these units can be a great spot to expand your retail
business.
Pros of business parks
• Parking is plentiful. Businesses located in a business park likely have their own employees
driving to work, resulting in large parking lots customers can use.
• Lots of space. A unit in a business park is typically bigger than one you’ll find in a busy
shopping center. That leaves plenty of opportunity for storage, creative layouts,
and experiential retail.
• You’re surrounded by business people. Build relationships with business owners in nearby
units for support when growing your own.
Cons of business parks
• They’re usually built in semi-residential areas, so customers might be going out of their
way to visit your store.
• Foot traffic can be minimal. This largely depends on the other units. If they’re offices or
industrial plants, for example, only workers will pass through the business park.
• Public transport is unlikely to run there since most employees commute via car.
Downtown
Downtown is the main business and commercial area of a town or city. Many merge retail buildings with
residential, such as retail units beneath high-rise apartments.
Pros of downtown
• There are lots of people around. Whether they’re passing through on their commute or visiting other retailers,
positioning your store downtown exposes you to large volumes of people.
• They appeal to health-conscious consumers. Unlike busy malls with less-than-ideal air circulation, downtown
is considered an open air environment with minimal touchpoints (such as doors), wider spaces, and fewer
crowds.
• Big companies like Google are investing in downtown areas, driving more foot traffic and hosting events for
the local community.
Cons of downtown
• Rent can be expensive. Since building owners merge domestic and commercial units, some charge a premium
for retailers who want to tap into residents.
• Limited customer bases. Unless you’re in a tourist area, downtown is typically dominated by members of a a
younger demographic who prefer city center living to suburbia.
• Parking is restricted. Many spaces are reserved for residents of the buildings.
• Some smaller towns and cities don’t have a popular downtown area.
 Home-based

There’s a lot that goes into finding a retail location. If you’re still unsure about which is best for your
business, consider setting up shop in a place you already have: your home.

Pros of home-based retail

• It’s much cheaper since you’re not paying extra real estate leases or operating expenses. Plus,
small business owners working from home can reduce their tax liability.
• It’s flexible. Minimal visitors means you have ultimate control over your “opening hours.”
Cons of home-based retail
• Security can be an issue. You can’t have potential customers stop by your home-based store if
you don’t want to reveal your home address.
• Distractions come thick and fast, especially if you’re working in a busy household.
• Scaling becomes difficult. Selling more inventory is great for business, but not great if its storage
begins to dominate your home.
• Some landlords prevent tenants from using their property as a retail space.
Types of Retail Store Layouts

Also known as a layout design or store design, a retail store layout is a term used to
describe how retailers set up their merchandise, product displays and fixtures in a store.
Because the way customers interact with products affects their purchase behaviors, a retail
store layout involves strategically using the space available to influence the customer
experience.

The two most important components of retail store layouts used to convert browsers to
buyers are:

Store design: The store design encompasses the intentional use of space management and
floor plans, including displays, furniture, fixtures, signage and lighting. The structure of
store design is highly influential in the customer experience.
Customer flow: The way that a customer navigates a store’s aisles is the customer flow.
Understanding customer flow and the common patterns of buyer behavior associated with
the way customers interact with merchandise is an essential part of retail management
strategy
Top 7 Types of Retail Layouts

Forced-Path
Straight
Angular
Geometric
Grid
Loop
Free-Flow
Racetrack
Forced-Path

The forced-path layout puts customers on a pre-determined route through a

retail store, guiding customers past whichever products need the most
attention. Walking shoppers in a set path around the store exposes them to all
of the products offered, enticing them to pick up an item they didn’t plan on
purchasing. Ultimately, this layout maximizes every aisle and highlights each
piece of merchandise.
On the other hand, customers who want to run quickly in and out of the store
may not like a forced-path retail layout. Instead of allowing customers to
target what they want, grab it quickly and dash out the doors, a forced-path
layout gives them no choice but to follow the pre-determined path until they
reach the product they want, then continue to the checkout before finally
exiting the store.
In summary, here are a few pros of a forced-path layout:
•Direct control over customer flow
•Can guide customers toward popular items or under-performing products
•Streamline foot traffic
•Maximize every aisle
•Promote profits by encouraging unplanned purchases
The following are the cons of a forced-path layout:
•Can feel restrictive to customers
•May be frustrating for customers who know exactly what they want
 Straight
Also referred to as the spine layout, the straight retail store layout is effective, easy to plan and generates
space for customers to fully peruse the store. Essentially, one main aisle — the spine — runs down the
store and connects the various sections on the rest of the floor. This store design uses space wisely by
optimizing the store walls, corner spaces and shelving fixtures to show off products everywhere customers
look.
A straight retail store layout is a popular floor plan because it is convenient and intuitive for shoppers to
follow. With the right signage, product displays and well-placed merchandise, customers are kept
interested and moving down the store’s main aisle. Because a basic straight layout helps to lure customers
all the way to the back of the store, this layout guarantees that all of the store’s products get seen.
Many small markets, department stores and food stores benefit from this retail layout because it offers
customers the chance to see everything in the store or go directly to an aisle if they want to cut their
shopping trip short. A straight floor plan can be especially beneficial for newer, local businesses that may
not have the financial means to purchase an expansive store building or create an elaborate store layout
yet.
In particular, here are the pros to a straight store layout:
•Shoppers are more likely to go all the way to the back of the store
•There’s plenty of space for displaying merchandise
•Customers have the space they need to look around at their leisure
•Custom retail displays and shelving fixtures allow every possible selling point on the floor within a straight
layout to be maximized
•As a versatile floor plan, the straight layout doesn’t require the store fixture to be selected according to
the floor plan
On the contrary, these are the cons of a straight store layout:
•Customers might move down the main aisle quickly, missing the merchandise placed at the front or sides
of the store
•It might not be as conducive to exploring aisles and discovering new products as some other retail layout
options
 Angular
An angular retail store layout is easier to picture when described as a curved
store layout. Despite having “angular” in its name, an angular retail store design
uses curved and winding product displays and store fixtures that direct the
customer flow to several different displays. The free-standing product displays
used in this retail layout cultivate a perception of higher-quality merchandise,
making this layout ideal for luxury stores.
Luxury stores and boutiques may also benefit from the way an angular store
layout encourages customers to “buy now.” Without seeing rows and rows of
stock, customers receive the subliminal message that in-demand items are in
short supply, pushing them toward making a purchase they may not have
planned on.
However, the angular floor plan has to sacrifice space efficiency to achieve this
high-end, exclusive look. Any excess stock must be kept away from the sales floor
in a back room or another storage area since you can’t display many products at
one time in an angular layout. Smaller boutiques might not have enough space to
use an angular layout and house their merchandise stock.
In short, the angular retail layout provides these pros:
•Crafts a unique retail store design
•Elevates the customers’ in-store experience
•Promotes the exclusive feel of luxury items
On the other hand, an angular layout comes with these cons:
•Less room to display products
•Rounded display style takes away wall shelf space
Geometric
The geometric retail store design is perfect for fusing functionality with
creativity. As its name implies, the geometric store layout incorporates a variety
of merchandise displays of all shapes and sizes, including squares, rectangles,
ovals and more. Stores that already have a unique interior due to wall angles,
support columns or ceiling design can embrace and enhance this pre-existing
aesthetic by using a geometric layout.
A geometric layout can help brands build their identity and awareness.
Specifically, combining an array of geometric product displays and fixtures of
various shapes and sizes can make a bold statement about a brand’s identity.
Selecting certain artwork, music and even scents to use with a geometric layout
can complete the store’s atmosphere and heighten the overall customer
experience.
Here are all the pros of following a geometric floor plan:
•Produces a unique store design without costing as much as many other retail
layouts
•Helps to make a statement about the merchandise
•Adds to the brand identity
•Can be used to direct the customer flow toward a certain product
Here are the cons to consider about a geometric floor plan:
•Can be too eccentric for the older demographics of customers
•Not always the best option for maximizing a store’s space for displaying
merchandise
 Grid
The grid layout is the traditional retail store floor plan that everyone is most familiar with.
Almost every grocery store, pharmacy and convenience store uses a grid layout. In most cases,
a grid layout design has several long aisles. The store will also usually place impulse-buy items
at the front of the store and other items near the back. In this way, a grid layout walks
customers by impulse-buy items on their way to and from the products they really need.
Specifically, here are the pros that come with a grid store layout:
•It’s great for displaying large numbers of various types of products
•More customers can find your products because the grid design prompts them to browse
multiple aisles
•It’s a familiar layout for shoppers, making it easy to navigate
•The predictable traffic flow pattern makes it easy to place promotional items where
customers will pass them
•It allows for a wide variety of store infrastructure, such as shelving, fixtures and more
On the flip side, here are a few cons that come with a grid store layout:
•It doesn’t cultivate a unique customer experience because the layout is common
•It may be a frustrating layout for customers who want to make a shortcut to the products they
know they need
•Can be confusing for customers if the product groupings do not make sense
•Lots of merchandise lined up with few visual breaks can be overwhelming for some customers
•Customers could bump into each other if the aisles are not wide enough
 Loop
The loop retail store layout, also known as the racetrack layout, creates a deliberately closed-loop
path that guides customers around the store and all the way around to the checkout. In between the
store’s entrance and the checkout, the loop walks customers past every piece of merchandise the
store has to offer.
Most loop store designs feature a main aisle or corridor that directs customers through the store in a
circular path. The looped path provides well-defined parameters that take customers on a well-
marked journey through the store. In this way, the loop layout easily controls the flow of traffic and
guarantees that each customer gets exposed to the most products possible.

Check out these top pros of a loop layout:

Predictable traffic pattern allows promotional items to be placed where they will definitely get seen
There’s maximum product exposure for all customers
Stores can be experimental with the journey the loop takes customers on similar to the way a
museum exhibit walks visitors through a story
Encourages customers to spend more time browsing items and interacting with product displays
These are the cons of a loop layout:
Customers do not get to decide which products they go to and from because they are set on a clearly
defined loop
It may be a frustrating layout for customers who know what they’re looking for and want to keep
their shopping trip short
It does not promote high traffic turnover for stores that want people to get in and out more quickly
 Free-Flow
Also known as the free-form layout, the free-flow layout follows its own floor plan
philosophy. A free-flow store design doesn’t attempt to control the flow of
customer traffic at all. Instead, the lax layout encourages customers to wander
around free of following any pre-determined traffic patterns.
The pros of picking a free-flow retail layout include:
Is a great floor plan for small spaces because it is versatile and flexible
Leaves more room between products for customers to roam more freely
Creates extra space to lower the likelihood of customers bumping into one
another
Is an excellent for helping higher-end shops with less merchandise to craft a brand
identity
When compared to other styles of store layouts, free-flow is the most likely to
produce an experiential retail space
Works well when incorporated into smaller sections of spine and loop layouts
The following are the cons of choosing a free-flow retail layout:
Often comes with less space for displaying products
Can be easy to forget the best practices for retail store layout and create a floor
plan that actually turns people away from the store
Some free-flow retail layouts can be confusing for customers to follow
Racetrack
Design
Retail Image

Image refers to how a retailer is perceived by customers and others,and

positioning refers to how a firm devises its strategy so as to project an
image relative to its retail category and its competitors-and to elicit a
positive consumer response. To succeed, a retailer must communicate a
distinctive ,clear and consistent image.
Once its image is established in consumers minds, a retailer is placed in
a niche relative to competitors.
 Elements of Retail Image

Retail store image is combination of factors which sets that store apart from its
competitors Target
Market Attributes of
physical facilities

Firm's Shopping
Positioning Experience

Customer Community
Overall Retail
Service Service
Image

Store Promotion Tools

Location  Advertising
 Public Relation
 Personal Selling
Merchandise
 Sales Promotion
Attributes Pricing
Effective Retail Space Management

The sight of a good retail store with attractive windows and an enticing
entrance—induce the customer into entering. The customer enters the
store and often keeps walking inside following the walkway wherever it
leads, or sometimes takes a while to look for directions, within the store.
Sometimes the customer’s attention is drawn to certain displays and
merchandise presentations before he moves on. To reach his destination
inside the store, the customer tends to follow directions to reach there,
especially in a big-box format. Seldom does he realise that
subconsciously he is directed to ‘walk’ the entire store and thus
exposing him to all that the store has to offer. This is achieved through a
well thought-out and laid-out retail floor design.
A well-planned and properly designed retail floor achieves a great deal for the store

It enables a smooth and efficient customer flow into the store and within it.
The design of the fixtures, the placement of merchandise and the fixtures on
the floor too direct customers through the store.
It helps the customer reach and access the merchandise he is looking for,
without fail.
The aesthetics of a well-planned floor are a visual feast for the customer and
trigger the ‘come-back’ feeling in him, as he feels a sense of belonging in the
store,
It helps creates a feeling of comfort in the minds of customers, enabling them
to waltz their way through without facing any bottlenecks on the way.
A well laid – out floor, in essence, helps the store to sell more effectively and
retain customers
Floor Space Management

It is the process of managing the floor space adequately

to facilitate the customers and to increase the sale. Since
store space is a limited resource, it needs to be used
wisely.
Space management is very crucial in retail as the sales
volume and gross profitability depends on the amount of
space used to generate those sales.
Optimum Space Use
Product Category −
 Profit builders − High profit margins-low
sales products. Allocate quality space
rather than quantity.
While allocating the space to  Star performers − Products exceeding sales
various products, the
managers need to consider and profit margins. Allocate large amount
the following points of quality space.
 Space wasters − Low sales-low profit
margins products. Put them at the top or
bottom of shelves.
 Traffic builders − High sales-low profit
margins products. These products need to
be displayed close to impulse products.
Size, shape, and weight of the product.
Product adjacencies − It means which
products can coexist on display?
Product life on the shelf
  Measure the total area of space available.
Retail Floor Space  Divide this area into selling and non-selling areas such as aisle,
storage, promotional displays, customer support cell, (trial
rooms in case of clothing retail) and billing counters.
 Create a Planogram, a pictorial diagram that depicts how and
where to place specific retail products on shelves or displays in
order to increase customer purchases.
Here are the steps to  Allocate the selling space to each product category. Determine
take into consideration the amount of space for a particular category by considering
for using floor space historical and forecasted sales data. Determine the space for
effectively
billing counter by referring historical customer volume data. In
case of clothing retail, allocate a separate space for trial rooms
that is near the product display but away from the billing area.
 Determine the location of the product categories within the
space. This helps the customers to locate the required product
easily.
 Decide product adjacencies logically. This facilitates multiple
product purchase. For example, pasta sauces and spices are
kept near raw pasta packets.
 Make use of irregular shaped corner space wisely. Some
products such as domestic cleaning devices or garden furniture
can stand in a corner.
 Allocate space for promotional displays and schemes facing
towards road to notify and attract the customers. Use glass
walls or doors wisely for promotion.
 Retail Marketing Mix
The retail marketing mix is a
marketing planning model comprising
various elements and methods
designed to encompass all marketing
efforts undertaken by retailers. These
efforts encompass sales, promotions,
store layout, pricing strategies,
customer service, and more, all
intended to generate sales of goods
and services.
 7Ps Of The Retail Marketing Mix

1. Product Or Merchandise 2. Price

Many companies build their foundation on their The pricing of a product significantly influences
products, while others focus on providing services. its success in the market. Businesses must
Some businesses even combine both products and balance maintaining a healthy profit margin
services. Before developing a product or service, a and offering customers value for their money.
company should research its customers’ needs and
preferences. Identifying market opportunities is a
Profitability and providing value are crucial
critical aspect of this research. This may involve considerations. Pricing should align with
analyzing products and services offered by customers’ perceived worth and be
competitors, studying industry trends, and competitive. Determining an optimal price
innovating to create offerings that resonate with involves market research and understanding
customers. Key factors in this element include consumer perceptions. Key factors in pricing
product development, management, features, strategy include profitability, value for money,
benefits, branding, packaging, and after-sales competitiveness, incentives, and quality.
services.
3. Place Or Store Location 4. Promotion

Product distribution plays a pivotal role in a Promotion is crucial for capturing consumer
business’s success. Traditionally, consumer interest and driving purchases. Effective
goods were sold in physical retail stores, but communication of a product’s or service’s
the rise of e-commerce has expanded benefits is essential. Identifying the target
distribution possibilities. Even online audience is a key step in marketing and
platforms where customers make purchases promotion. Customizing promotion
are considered “places.” Strategic methods based on the potential customer
placement within physical stores and easy base enhances sales. Developing
online accessibility is vital for attracting promotional mixes, managing advertising,
customers. Considerations include the utilizing sales promotions, and maintaining
target market, channel structure, retailer public relations are key aspects of this
image, logistics, and distribution strategy. element.
5. People Element 6. Process Element

Interactions with individuals outside the company, Efficiency is a crucial element in the
such as customers and partners, are integral to a
business’s success. Marketing efforts aim to attract manufacturing or service delivery
external clients and boost sales. The internal process. It helps control costs and
workforce, including managers, salespeople, minimize waste, ultimately impacting
customer service representatives, and support staff, is
critical in shaping the organizational culture. This revenue. Efficient processes reduce the
culture either attracts or deters clients. Every wastage of time and resources, leading
individual involved in the product or service, from
customer-facing roles to those in production,
to faster delivery and improved
distribution, and delivery, impacts sales and customer customer satisfaction. Key focus areas
satisfaction. Key considerations include staff include order processing, database
capabilities, efficiency, availability, effectiveness,
customer interaction, and internal marketing. management, service delivery, queuing
systems, and standardization.
 Example
Airlines are a good example. Suppose a low-price
airline brand is in the market, and it wants to
boost its revenue and decides to offer deals on
7. Presentation its website. The service (or product) offered here
is transportation. Boosting sales when air travel
is considered a luxury might take much work.
Effective presentation is pivotal in selling a However, offering affordable tickets is a good
product or service, particularly in making a way to target low-income individuals.
favorable first impression. This extends to
the product’s appearance and how well it At the same time, providing premium tickets
aligns with the company’s brand identity. with extravagant amenities attracts the rich
Designers and professionals work on crowd as well. This is where pricing comes in.
product presentations, tailoring them to The company decided to promote it by placing
the intended target audience. The advertisements in newspapers and social media.
packaging, customization, communication, This is part of the promotion. The place factor of
and branding all contribute to the the marketing strategy is their online website.
They’re boosting their sales by using these
presentation’s impact. strategies—like product, price, promotion, and
place.
Importance of Retail Marketing Mix

• A product or service is sold using the marketing mix, a collection of

marketing tools or strategies. Using it for selling products in the retail sector
is known as a retail marketing mix.
• It involves choosing how to position a product so consumers will buy it at the
ideal location, price, and moment.
• The marketing and promotion plan of the business will sell the goods.
• A marketing mix is a fantastic tool for developing the best possible marketing
plan and putting it into practice with efficient strategies. They are done to
reach the vast majority of audiences in an appealing way to attract
customers.
• It is only when sales are made profit is evident marketing mixes find a way to
ensure that.
• Therefore, a business’s overall marketing strategy depends heavily on
evaluating the parts played by the seven Ps of the mix.
Retail Location
Your retail store location will have a significant impact on your public
image, foot traffic, future revenue potential, and other factors. Choosing
a store location without taking these elements into account may hinder
the company’s capacity to flourish and grow.
Define how you picture your business now and in the future before
deciding on a retail store location, ask yourself these questions:-
What are the demographics of your customer base?
Are you able to visualize your structure?
Do you have a clear idea of what you want to sell and how you want to
be known?
Have you calculated how much retail space, storage space, or office
space you’ll need?
Retail Location Process

The selection of the store site can be a non systematic process, which is
based on gut feeling or environmental observation or an imitation of
competitors (or near competitors) On the other hand, it may be a
systematic process, which would be based on certain parameters and
steps to be followed. In this article we look at the systematic process to
be followed which would start with the retailer first addressing the
question on where to locate the retail tire, or the region that he want
to locate the store in.
This may be a region in city, a state or an international market that he
wishes to tap. After identifying the region, the following steps have to
be followed:
1) Identify the market in which to locate the store
2) Evaluate the demand and supply within that market i.e. determine
the market potential or the market size and estimate the number of
shops that would be required to serve the market.
3) Identify the most attractive.
4) Select the best site available.
1. Market Identification

The first step in arriving at a decision on retail location is to identify the markets attractive to
a retailer. This is important as he needs to understand the market well, especially in country
like India; here every region has its own peculiarities and needs. Similarly this is also
important in case of an international expansion. The Characteristics the markets of Europe
are different from those of America and the Far East.
Various theories have been presented on how to gauge the attractiveness of a market. It is
believed that research no store locations stated after World War I and various social theories
presented theories based on the concept of gravity. Some theories, which aid decision
making with respect to the location of the retail store are discussed in a subsequent section.
2. Determining the Market Potential
In order to determine the market potential the retailer needs to take into consideration various elements. The chief
among them are:
 Demographic Features the Population: Understanding the features of the population is integral to developing
retail marketing strategy. Data one population of India can be obtained from the Census of India reports. Merely
getting an idea of the size of the population is not enough. In India, it is essential o know the breakup of rural
and urban population as growth of urbanization is again essential or the growth of retail. The retailer also needs
to understand the level of literacy and the level of education in the population.
 The characteristics of the Households in the Area: The retailer needs to have a clear understanding of the
average household income and the distribution of this income in the area. This is very essential as the level of
income largely determines the kind facilities require. For example in a locality which has households with
relatively low incomes, a regular bania is bound to exist however fashion apparel retail store is unlikely to
succeed. And understanding of the average age profile of the population in the area is necessary as it aids in aids
in decision making. For example, a neighborhood which has a large number of young households, may be more
oriented towards fast food and casual clothing. An understanding of the employment levels and the type of
employment indicates the kind of preferences that the population may have for certain products or services.
 Competition and Compatibility: While determining the market potential, it is necessary to check the
compatibility of the retail store with the other retail outlets in an area. for example, a good location for a gift
shop would be near a department tire or a theatre or restaurant, as such a location would allow potential
customers to spend time looking at the gift shop’s display windows. Similarly, locating a high fashion boutique
next to a bakery or a hardware store may not be a very good idea. While it is necessary to check the level of
compatibility, it is also necessary to do an analysis of the competition in the proposed area. It is necessary to try
and evaluate their strengths and weaknesses, to know the square foot area of the various stores in the area and
the kind of returns that they are able to obtain per employee per square foot.
3. Identify the most attractive 4. Select the best site available

• Research the area: Research the area to • Look for amenities: Look for
determine the type of customers that are amenities such as parking, public
in the area, their median income, and
the local competition. transportation, and other services
• Consider visibility: Consider visibility
that can help draw customers to
that the location provides, both in terms your store.
of cars passing by and the foot traffic in • Consider the future: Consider the
the area.
potential for the area in the
• Analyze the rental cost: Determine if future, as well as the potential
the rental cost is within your budget and
consider any additional fees that may for expansion and growth.
apply.
Factors Affecting Location
Proximity to target customers
Accessibility of the location
Visibility of the store
Demographics of the area
Local competition
Cost of rent or lease
Public transportation
Parking availability
Zoning laws
Crime rate in the area
Local taxes and regulations
Store Positioning
Positioning is a marketing concept that outlines what a business should
do to market its product or service to its customers. In positioning, the
marketing department creates an image for the product based on its
intended audience. This is created through the use of promotion, price,
place and product.
Attracting the customers is the crux of the issue of retail trade. How
and where the store is positioned on the site affects the retailer’s ability
to attract the customers. Therefore in evaluating the existing store
facilities or planning future site layouts, the retailer should answer
effectively and satisfactorily these three questions. These are:
1.How visible is the store?
2.Is the store compatible with its surroundings?
3.Are store facilities placed for customer convenience ?
 1. Ensuring the Store Visibility

The customers must see the store if the retailer wants to achieve the goals of stopping, attracting and inviting
the customers. A visible store becomes a part of the consumers mental map of where, to shop for certain
product as service. Visual awareness of a stores existence has the short-run benefit of alluring impulse shoppers
and the long-run benefit of attracting the future customers who develop a particular need for the retailers
products. Architecture is a major factor both ill making the right impression on the consumers and in developing
an efficient retail operation. The actual store’s architecture is a compromise between both the aims namely,
making an impression and designing a functional facility and services. Ideally, a store should be positioned so
that it is clearly visible from the major traffic arteries adjacent to the site. A retailer can improve the store’s
visibility be using three interacting factors namely, setback, angle and elevation to his advantage.
1. Set back. Reduced visibility is the result of either setting the store too far back from a traffic artery or from
positioning it too close to the street. Therefore, ideally a store should be setback far enough to give the
passersby a broad perspective of the entire store, but close enough to let them read major signs and see the
possible window displays.
2. Angle. Visual impression can also be increased or decreased by the angle of the store relative to a traffic artery.
A retailer should place the building at an angle to the traffic artery that maximizes the exposure, in
positioning the store. Since the store’s front is designed to stop and attract potential customers it should face
the major traffic artery when the store’s back or sides are visible to passersby, they too should be attractive
and informative.
3. Elevation. The elevation of a site can place the retailer’s store above or below the main traffic artery level.
Normally, elevation problems can be overcome by landscaping and the use of signs. However, such problems
always translate into visibility problems for retailers that badly need exposure. It so happens that most of the
 2. Designing Site Compatibility

By fitting the store to the naturally of the land and the natural habitat a retailer
can reap the harvest of benefits in terms of visual impressions. The retailer must
consider several issues in designing for site compatibility.
(1) The size of the facility should be appropriate to the size of the site. A sense of
proportion makes a sea of difference.
(2) The architectural design and construction materials should portray a
harmonious relationship with immediate environment
(3) A certain amount of open space adds to the natural appearance of the store
in making it attractive.
3. Planning Consumer Conveniences

The retailer should take into account as to how the position affects
consumer convenience while planning the store’s on the site position.
Enough parking space for vehicles should be available with sufficient
access to these vehicles. Parking lot should allow easy movement-to
and fro and turnaround the vehicles. Parking should be with safety and
that ensures easy movement of pedestrians to the store.
Retail Merchandising

Buying function, Markups & Markdown in merchandise management,

shrinkage in Retail merchandise management, Factors Affecting Buying
Decision, roles and responsibilities of Merchandising. Merchandise
Pricing: Concept of Merchandise Pricing, Pricing Options, Pricing
Strategies, Pricing Objectives, Types of Pricing.
Retail Merchandising

 Retail Merchandising refers to the various activities which

contribute to the sale of products to the consumers for their end
use. Every retail store has its own line of merchandise to offer to
the customers. The display of the merchandise plays an important
role in attracting the customers into the store and prompting them
to purchase as well.
 Merchandising helps in the attractive display of the products at the
store in order to increase their sale and generate revenues for the
retail store.
 Merchandising helps in the sensible presentation of the products
available for sale to entice the customers and make them a brand
loyalist.
Buying function
The main process of marketing is buying. There are two aspects of
exchange buying and selling.
In the absence of buying, exchange of marketing becomes impossible.
Without buying, selling cannot be done,similary,without selling buying
cannot be.
Buying and selling are the two functions to be performed at a time in
marketing process. Buying goods for use or resale is called buying
function. Taking goods by paying certain price to the seller is buying. In
marketing, the function of buying does not mean only buying something.
It is used in broad sense. Buying function of marketing includes the
function such as determining necessary goods, finding out the supply
sources, selecting quantity, quality, grade, size, deciding on price,
discount, delivery date, means of transport and other agreement and
finally transferring ownership.
So, producer/manufacturers,wholesaler,retailers or ultimate consumers
buy goods. So, buyers can be divided in three classes as manufacturers,
middleman and ultimate consumers.
1.Manufacturers
2. Middlemen
3.Utlimate Consumers
 MARK-UPS & MARKDOWN IN MERCHANDISE MANAGEMENT

With the emergence of various retail formats and enhanced

competition, it is not practical for a retailer to sell all the merchandise
items at their actual prices. Price adjustments include either mark
down or additional mark ups. Therefore, retailers compute the initial
mark up, maintained mark up and gross margin during their normal
course of business.
MARK-UPS

Initial mark up: It is based on the selling price assigned to the

merchandise less the costs of the merchandise sold.
Maintained Markup: It is the amount of profit a retailer plans to maintain
on a particular form of merchandise. It is based on the selling price that
you intend to wish less the cost incurred on goods sold. As maintained
mark ups are concerned to actual prices received, therefore, for a retailer,
it is always difficult to estimate in advance.
The point of difference between initial markup and maintained markup is
that initial markup percentage depends on planned retail operating
expenses, profit, reductions and net sales while on the other hand,
maintained markup represents some additional costs from original retail
values caused by discounts, shortages, Inventory theft, markdowns and
added markups.
MARK DOWN
Mark down is a most common technique to push retail sales that offers
particular merchandise at a price less than the merchandise’ marked
price (normal price). The reasons for several types of merchandise
include:
(i) Overstocking / over buying
(ii) Season (climate) change
(iii) Clear out store worn / slow moving merchandise
(iv) Clear out old fashioned / old trend merchandise
(v) To generate customer traffic
Types of Mark downs
Temporary Markdowns: This is a policy of reducing the prices of merchandise for a
particular time period due to a particular reason. For instance, markdown because of clear
out shop worn / substandard merchandise. Once such merchandise is sold, the product
will be priced to the normal selling price.
Permanent Markdowns: In such markdowns, price reduction is made for comparatively
longer periods, may be few weeks, few months or more. Unlike the temporary markdown,
where price reduction takes place for a particular cause and price eventually will be raised
to the original one, the permanent mark down is used to replace the old quality
merchandise with the new one.
The reasons for permanent markdown are:
(a) Merchandise is of perishable nature and will be of no use after sometime
(b) To replace the old technology goods to new and latest versions
(c) Particular merchandise that a manufacturer / marketer no longer wish to
produce/sell.
Seasonal mark downs: Under such markdowns, prices are reduced to clear out the
seasonal retail merchandise, such as ‘Ludhiana woolen sales’ in the last months of winter
season are very common in North Indian states like Haryana, Punjab, and Delhi etc.
Additional Markup
Unlike the markdown where the prices are reduced, the additional
mark up is intended to increase the retail price above the original mark
up due to certain reasons like:
(i) When the demand for merchandise offered is exceptionally high
(ii) Due to monopoly like situation
(iii) When competitors are not able to meet the consumers’ demand
(iv) In case private labels are performing well in retail market and have
good demand, retailer would like to have quick and fast returns.
SHRINKAGE IN RETAIL MERCHANDISE MANAGEMENT

Retail shrinkage, or shrink, is a term used in retail loss prevention. It

refers to any type of loss identified as missing money or inventory that
should be present but isn’t actually on hand or saleable. It can come in
myriad forms, such as customer theft, damage, bookkeeping errors,
internal theft, or vendor fraud, and it can affect any company, although
it is most prevalent in the retail industry. The average shrink percentage
is about two percent of sales in retail. Although that might sound low,
when it’s all put together, this accounts for tens of billions of dollars in
losses for retailers each year. If you own a retail business, you must be
proactive in preventing shrink before it starts to significantly cut into
your profits and negatively affect your bottom line.
Retail Shrinkage Affects Everyone
When business owners face considerable retail shrinkage, they must
often resort to raising their prices or reducing their employee wages to
account for the losses. This affects the consumers who must then pay
higher prices. It affects the employees who must work for lower wages,
for fewer hours, or with fewer perks and benefits. And it affects the
business owner who is then placed at a competitive disadvantage. He
will have more difficulty attracting and retaining high-quality employees
and may lose loyal customers over the price increases. It is vital for the
retail business owner to prevent shrinkage in order to avoid these far-
reaching consequences for everyone involved.
 Types of Shrink
Employee theft: is the number one source of shrink in the retail industry. It can include
pocketing cash, discount abuse, under-ringing, sweet-hearting, refund abuse, or the
blatant theft of merchandise.
Shoplifting: This not only includes customers hiding merchandise in their bags and
walking out of the store without paying but also altering or swapping price tags and
other methods of theft.
Administrative errors: Administrative errors make up about 15 percent of the total
shrink rate. Pricing errors due to markups or markdowns, bookkeeping mistakes, and
counting, sorting, and storing errors during cash handling can cost retailers a lot of
money.
Vendor fraud is a small category of shrink but it must still be considered in your loss
prevention strategy if you want to prevent it. It most often occurs during the delivery
and return of merchandise.
 Preventing Shrink with Automated Cash Solutions
 To combat these avoidable losses, retail business owners should consider investing in cash
management solutions. Automation will allow you to increase visibility and accountability. Here are just
some of the solutions you should consider.
 A cash recycler that collects and dispenses currency will help you curb shrinkage by reducing the risk of
human error, ensuring that every dollar is automatically accounted for at your registers, and keeping
your money safely locked up. Your employees and customers will be unable to steal from your registers
when you invest in cash recycling.
 Currency counters and sorters take your money out of your employees’ hands. When you let these
machines do all of the counting, sorting, and reporting your end-of-day sales, you give your employees
fewer opportunities to steal from you. These devices will also alert you to counterfeit fraud.
 A fully integrated cash management solution that is incorporated within your POS system can help you
increase accountability, so if a suspicious situation arises, you’ll know exactly where to look. When your
employees know that their every move is being watched when they’re handling your money, they’ll
think twice before stealing. A fully integrated cash management system will enable individual logins
with personal identification numbers as well as automatic deposit validation, money reconciliation, and
storage into cassettes that can only be removed by management or armoured car services.
 Retail business owners who rely on technology as part of their loss prevention strategy see lower
overall shrink than those who don’t.
Merchandise Pricing
A retailer must price merchandise in a way that besides satisfying the
customers, achieves profitability for the firm. Pricing is a crucial
exercise due to its direct relationship with a firm’s goals and its
interaction with other retailing matters. A pricing policy, if not
appropriate, send a store out of competition. A pricing strategy must be
consistent over a period of time and consider retailer’s overall
positioning, profits, sales and appropriate rate of return on investment.
Lowest price does not necessarily be the best price, but the lowest
responsible price is the best right price. The difference between price
and cost is profit which can be very high when the sales person wants
to exploit an urgent situation.
The Consumer and Retail Pricing
Retailers should understand the importance of pricing because it has direct
relation with consumer purchases and perceptions. During pricing decisions,
retailers should also under the price elasticity of customers to price changes in
terms of the quantities bought.
If relatively small percentage change in price results in substantial percentage
changes in the number of articles purchased, price elasticity will be high. This
is the situation where the urgency to purchase is low or substitutes are well
available. If large percentage changes in price have small percentage changes
in the number of articles purchased, demand is considered to be inelastic. This
is the situation where purchase urgency is high and substitutes are not easily
available. The formula to compute price elasticity is given below. The price
elasticity is calculated by dividing the percentage change in the quality
demanded by the percentage change in the price charged. Because in retail
market sales usually decline as prices go up, elasticity tends to be on negative
side.
Pricing Options
(i) Predatory Pricing: It involves large retailers that normally seek to
produce competition by selling merchandise at very low prices and
create the situation where it becomes difficult for small retailers to
stay.
(ii) Prestige pricing: It assumes that customers will not buy
merchandise displayed if price fixed are too low. It is based on the
price-quality association.
(iii) Price lining: A pricing practice where by retailers sell merchandise
at a limited rate/limited range of price points, where each point
represents a different level of quality
Pricing Objectives

Pricing objectives are generally considered as part of the general

business strategy and give direction to the retail pricing process. While
deciding on pricing objectives, a retailer must understand that pricing
strategy must reflect the retailer’s overall goals that can be stated in
terms of profit and sales
Pricing Objectives

(i) Achieving pre-determined return on investment (ROI)

(ii) Building company’s image, goodwill and brand’s name
(iii) Building sustainable competitive advantage
(iv) Creating curiosity and interest about goods and services
(v) Creating store traffic
(vi) Early recovery of cash
(vii)Having price leadership
Pricing Objectives
(viii) Increasing company’ growth
(ix) Increasing market share
(x) Increasing rupee sales
(xi) Justifying social responsibility of business
(xii) Making the newcomers’ entry in the industry difficult
(xiii) Matching with competitors’ prices
(xiv) Maximizing long-term profit volume
Pricing Objectives
(xv) Maximizing short-term profit volume
(xvi) Partial Cost Recovery
(xvii) Providing ample customer service
(xviii) Quality Leadership
(xix) Stabilization of prices and margin
(xx)Survival
(xxi) Avoiding government intervention of any kind
Pricing Strategies

Pricing strategy must consider that it costs to manufacturer to develop

a product; it requires expense on distribution and promotion. A lot of
pricing strategies are on hand and are practiced throughout the world.
The main criterion to adopt a particular strategy is “what objectives’ a
firm decides to achieve?” A price strategy can be demand, cost and/ or
competitive in nature. As charging too high or too low may cause loss
to the firm, pricing should take demand, cost and/or competition into
account.
Demand Oriented Pricing
Under demand oriented pricing, prices are based on what customers expect
or may be willing to pay. It determines the range of prices affordable to the
target market. Under this method, retailers not only consider their profit
structure but also calculate the price-margin effect that any price will have on
sales volume. As the very name implies, demand oriented pricing strategy
seeks to forecast the quantities (sales volume), customers would purchase at
various prices and concentrates on the prices associated with pre-determined
sales targets. For example, if customers are highly sensitive to price tags, a
price cut can enhance the sales volume so much that profits actually go up.
On the other side, if customers are less bothered about ‘price’, increasing the
sales price will directly result into increased profits. In short, demand
oriented pricing seeks to estimate the price level that maximizes profits. The
main advantage of demand oriented pricing strategy is to set the
merchandise prices as per customer response towards the product offered.
Cost Oriented Pricing
Under this form of pricing policy, a retailer decides a floor price of the
merchandise a minimum price suitable to the organization to achieve its
financial goals. A retailer under this method sets the price to cover
production cost, operating costs and a pre-determined percentage for
profit. The percentage varies strikingly among industries, among member
outlets and even merchandise of the same retail firm. One popular form
of such pricing strategy is to mark up pricing. In mark up pricing, a
retailer sets the prices of the merchandise by adding per unit
merchandise costs, retail store operating expenses and determined
profit. The gap between merchandise price and selling price is the mark
up. For instance, a retailer purchases a wooden Almirah for Rs 3000/-
and sells it for Rs 5000/-, the extra Rs 2000/- is charged to cover its
store’s operating costs and profit. In this case, the mark up is 80% or
66.67 percent on cost.
 Determination of Initial mark up, Maintained mark up and Gross
Margin
Initial mark up: It is based on the selling price assigned to the merchandise less the costs of the
merchandise sold.
Maintained Markup: It is the amount of profit a retailer plans to maintain on a particular form of
merchandise. It is based on the selling price that you intend to wish less the cost incurred on goods
sold. As maintained mark ups are concerned to actual prices received, therefore, for a retailer, it is
always difficult to estimate in advance. The point of difference between initial markup and
maintained markup is that initial markup percentage depends on planned retail operating
expenses, profit, reductions and net sales while on the other hand, maintained markup represents
some additional costs from original retail values caused by discounts, shortages, Inventory theft,
markdowns and added markups. The maintained markup percentage can be viewed as:
Gross Margin: Gross margin, commonly known as gross profit is an important performance
measure in retailing. It indicates the retailer a measure (estimate) of how much profit it is making
on merchandise sales without considering the expenses associated with running a store. In other
words, gross margin is the difference between Net sales and the Cost of goods sold.
Gross Margin (In Rs.) = Net sales – Total Cost of goods
Competition Oriented Pricing

(A) Competitive pricing below the Market rate: It simply means setting
the merchandise prices simply to beat the competitor’s price by
charging price that is below the prevalent market rate. This policy is
advisable only when retailer follows an optimum inventory plan,
procure merchandise at right time and at right (minimum best
possible) price to gain the benefits of cash payment, trade discount,
bulk buying etc.
This policy is followed under following circumstances:- (i) When retailer
has no locational advantage. (ii) Selling force is not competent and has
little product knowledge. (iii) Customer services offered are average. (iv)
In case of unimpressive layout and visual merchandising and (v) When
retailer has its own manufacturing of some private labels or merchandise.
Competition Oriented Pricing

(B)Competitive pricing above the market rate: This policy allows a

retailer to set the merchandise price above the current market rate.
This policy seems to be straight forward and simple but must be
applied carefully.
This policy is suggested to those retailers who have some competitive
advantages like: (i) In case of excellent consumer service. (ii) In case of
high level of personal selling, delivery and exchange facilities. (iii) When
retailer has a stock of well known brands that are not available to its
competitors in the nearby location. (iv) When retailer has attractive,
huge and modern retail infrastructure to offer merchandise that will
allow a retailer to charge the merchandise price above market rate.
Pricing Adjustments Techniques: After deciding the prices of
merchandise, the retailer’s next step is to consider whether there is any
need to change some prices due to reasons like changing demand
patterns, pilferage issues, competition and seasonal shift during normal
course of business. Price adjustments include either mark down or
additional mark ups.
• Mark Down
• Additional Markup
Types of Pricing
(i) Horizontal pricing: This practice involves agreements among manufacturers,
wholesalers, retailers to set certain prices. These agreements usually are illegal
under Indian sales act.
(ii) Vertical Price Fixing: A practice where manufacturers or wholesalers seek to control
the retail prices of their merchandise through some sort of agreements.
(iii) Price Discrimination: A pricing practice where different prices are charged from
different retailers for the same merchandise and same quality.
(iv) Minimum Price Laws: These laws prevent retailers from selling certain items for less
than their cost plus a fixed percentage to cover overhead.
(v) Unit Pricing: The objective of such legislation is to let the customers compare the
prices of product available in many sizes. For instance, Food and Grocery stores must
express both the total price of an item and its price per unit of measure.
(vi) Item Price Removal: A pricing practice whereby prices are marked only on shelves or
signs and not on individual item.
Factors Affecting Buying Decision (Retailer Aspect)

• Market trends
• Customer behavior
• Inventory management
• Pricing
• Promotions
• Product assortment
• Supply chain logistics
• Competition
• Seasonality
• Sales forecasting
Roles and responsibilities of Merchandiser

• Collaborating with suppliers, manufacturers, and retailers to ensure

proper execution of merchandising plans
• Ensuring retailer compliance with merchandising strategies
• Creating and organizing promotions and advertising campaigns
• Maintaining inventory of products
• Gathering information on market trends and customers’ reactions to
products
• Analyzing sales data - reporting growth, expansion, and change in
markets
 Unit IV: Retail Operation
Elements/Components of Retail Store Operation, Store Administration,
Store Manager–Responsibilities, Inventory Management, Management
of Receipts, Customer Service, Management of Retail Outlet/Store,
Store Maintenance, Store Security, Types of Retailing Formats: Super
Market, Hyper Market, Departmental Stores, Convenience Stores,
Catalogue Retailers. Non Stores Retailing: Vending Machine, Door To
Door selling, Mail Order Business. E- Retailing: Credit Card Transaction,
Smart Card and E-Payment.
 Elements/Components of Retail Store Operation
STORE ADMINISTRATION
MANAGING INVENTORY AND DISPLAY
VISUAL MERCHANDISING
CASH HANDLING
Merchandise Management
Employee Management
Customer Management
STORE ADMINISTRATION
Store administration deals with various aspects, like the cleanliness of the
store premises, maintenance of the store façade and the display windows,
etc. Administration is also responsible for utilizing the store personnel
effectively. Time keeping for the store staff is important. It is also
necessary to keep track of holidays and the shifts that the staff may be
required to work . The premises of the store need to be maintained as per
the standards decided upon by the management. This involves the task of
cleaning the store and arranging the merchandise before the first
customer can walk into the store . An important task of administration
involves ensuring that all the required permissions and licenses to run a
retail establishmentare procured from the right authorities.
MANAGING INVENTORY AND DISPLAY
The task of allocating the merchandise to various stores usuallyrests with the
merchandise management team or the categorymanager, as the case may be. At
the store, the store staff does themanagement of this inventory. To enable them to
work efficiently,the complete procedure for the handling of merchandise at the
storelevel needs to be documented. Responsibilities with respect tomerchandise at
the store level involve receiving and inwarding thegoods. Once the merchandise is
received at the store, the quantityand other details like colour, style and size have
to be checked withthe document accompanying the goods to detect any
discrepancies.In case of most large retailers, using a hand held scanner,
themerchandise is scanned and the system updated for stocks received.
Merchandise may be received at the store from a Central Warehouse, a Regional
Distribution Center, a supplier or fromanother store.
VISUAL MERCHANDISING

Visual merchandising covers the aesthetic aspects of each of stores. The designers
in this part of the team get the chance to make great first impressions on new
customers entering your stores. The visual design and atmosphere encompass
everything that your store has control over, inside and outside.
These operations include:
 Individual store layouts
 Store departments and product organization
 Signage and displays
 Product merchandising
 Music playing over the in-store speakers
 Control of lighting throughout the store
CASH HANDLING

One of the most important aspects of retailing is cash handling . It is

essential for the retailer to track the daily cash flow to calculate the profit
and loss of the store. Cash Registers, electronic cash management system
or an elaborate computerized point of sale(POS) system help the retailer to
manage the daily sales and the revenue generated. Cash handling
operations are responsible for the incoming payments from customers. A
mix of cashiers, supervisors, and managers is part of store’s cash handling
operations to limit returns and fraud. In most cases, cashiers handle the
incoming cash from sales, while supervisors handle customer refunds and
exchanges. Managers or shift leads handle cash register setup, safe
deposits, balancing the register at the end of the day, and making sure bank
deposits are accurate.
Store Administration
Store Manager–Responsibilities

Recruiting employees for the store is the store manager’s prime

responsibility. He not only has to hire the right candidates for the store
but also train them for their overall development. He must ensure that all
the employees (floor manager, department manager, cashier and so on)
contribute to their level best for the effective functioning of the store.
He must act as a strong pillar of support and stand by his team at the
hour of crisis. It is his duty to acquaint his team members with the latest
trends in fashion or any other newly launched retail software. It is his
responsibility to delegate responsibilities to his subordinates according to
their specializations and extract the best out of them. The store manager
must motivate his team members from time to time.
Store Manager–Responsibilities
The store manager must make sure his store is meeting the targets and earning profits.
He is responsible for the smooth and effective functioning of the store.

The store manager is responsible for maintaining the overall image of the store. It is his
duty to sensibly display the merchandise so that it immediately catches the attention of
the customers. The store manager must ensure that his store meets the expectations of
the customers and lives up to its predefined brand image.
He must ensure:
 The store is kept clean
 Shelves and racks are properly stocked and products do not fall off the shelves.
 Mannequins are kept at the right place to attract the customers into the store and rotated
frequently.
 The merchandise should be according to the season as well as the latest trends.
 The store is well lit, ventilated and offers a positive ambience to the customers.
 The signage displaying the name and logo of the store is installed at the right place and viewable
to all.
Store Manager–Responsibilities

 One of the major responsibilities of the store manager is to make the

customers feel safe and comfortable in the store. It is his key responsibility
to make sure that the customer leaves the store with a pleasant smile.
 He is responsible for managing the assets of the store. The security and
safety of the store is his responsibility. The store manager must ensure that
sufficient inventory is available at the store to avoid being “out of stock”.
 He along with his subordinates are responsible for planning, managing
profit and loss, handling cash at the store as well as collating daily sales as
well as other necessary reports.
 He must ensure that the store is free from pilferage.
Inventory Management

Inventory management refers to the process of ordering, storing, using,

and selling a company's inventory.
Benefits of Inventory Management

Keeps count of stock

Helps with quality control
Store inventory control plays a crucial role in
Store inventory control helps maintain a counting your stock in the warehouse. Humans
specific standard of your products and can’t do this, and this management measure
therefore look into its quality control. While helps reduce the chances of human error. You
this helps during your store audit, it is also would not know where each item is located in
beneficial for store merchandising as you your warehouse, would you? The store
have detailed information about your stocks. inventory control system enables you to
If you find stocks below your company’s arrange and keep track of your inventories. It
guaranteed quality, you may act accordingly. also helps in checking the status of each item
It helps you inspect the status of your goods and notifying you. It allows you to count and
in the warehouse and run regular quality track your inventories’ flow and determine a
checks on them. Thus, store inventory specific quality of products for your
management lets you offer top-notch customers. Thus, such a system helps in better
products to your customers, enhancing your store management.
brand reputation and customer base .
 Benefits of Inventory Management

Ensures you don’t oversell

Helps with inventory accounting A significant problem with most retail companies
Store inventory control helps in your store’s is they often tend to oversell. Overselling or
inventory accounting. This system reduces the similar attempts can not only hamper your
chances of human error and saves your time business progress but also affect customer
and error as it accounts for the status and total relations. Store inventory control systems help you
worth of your inventories. Thus, store inventory avoid this. Since you have a piece of detailed
control is highly beneficial for store knowledge about your inventories, you are
management and helps you assess what is in relieved from the rush of overselling the products
your store and promote in-store merchandising. you can store in your warehouse. As a result, store
Through this mechanism, you would get an inventory control ensures better management of in-
idea of the high value inventories and the ones store merchandising. You can further understand
that need to be sold the earliest. It helps move the items that need to be sold sooner or the ones
your business towards your specific goals and that you need to discard through this system.
proper direction.
Customer Service
What Is Customer Service?
Customer service is the direct one-on-one interaction between a
consumer and a company representative. The interaction is
commonly done when a consumer is buying a product or service from
the company. Most retailers see this direct interaction as a critical
factor in ensuring buyer satisfaction and encouraging repeat business.
The option to speak to a live customer service agent is considered
necessary for most businesses even though the bulk of customer care
is automated. Customer service is also considered a key aspect
of servant-leadership.
 Benefits of Customer Service

• Customer Retention: The first and most obvious advantage of having a customer service plan in place is to keep customers happy. It
means listening to concerns, being empathetic, and easing issues related to product availability, payment, returns, and technical support.
Showing that a company cares keeps customers loyal.
• Employee Retention: Customer service isn't just for customers. It also helps keep employees with the company. When customers are
happy, employees are, too. Individuals tend to want to work in an environment that cares about their customers.
• Troubleshooting and Problem-Solving: Businesses have to take care of their customers' problems. But companies that take a proactive
approach tend to do better. This means that it's important to reach out to customers before any issues arise. This shows that the company
cares and is doing all that it can to ensure a smooth customer experience.
• Leads to Referrals: Consumers who have a good experience usually pass on that information to others, whether that's through word-of-
mouth to people they know, customer reviews, or social media. This often helps businesses generate new sales.
• Boosts Brand: Businesses that show consumers they care through customer service help increase their brand equity. This also leads to
more referral and, therefore, an increase in sales.

• Increases Customer Lifetime Value: This refers to the relationship customer service helps establish and solidify with a single customer.
When a company provides a single customer with good service, that person is more likely to add to the company's revenue by remaining
loyal and making more purchases.

• Corporate Culture: Customer service allows businesses to streamline their workflow and promote cooperation among different teams.
This includes communication between agents and managers, technical engineers, and production teams. All of this is to help corporations
achieve their goals of customer attraction and retention, and increasing sales revenue.
• Competitive Advantage: Having a good customer service base sets a company apart from its competition. It boosts the business's
reputation and also increases its brand value by showing consumers and competitors that the business values the relationships it has with
new and existing customers.
Traits of Good Customer Service

• Personalization: Tailoring the experience to each customer is an effective way of practicing good
customer service. After all, not everyone is different and has the same needs. Listening to what their
needs are can help determine the course of action and the direction of the experience.
• Speed: Businesses should provide their service quickly. If there's a problem, it should be resolved as
soon as possible. Customers don't want to wait to get an issue resolved or to have their questions
answered. Having said this, there is a fine balance between speed and problem-solving—not getting
the customer off the phone or brushing them off without a resolution. This means
that efficiency and effectiveness may have to supersede speed in order to provide a great
experience.
• Option for Self-Service: It's important to allow customers the option to help themselves, whether
that's through an automated service or self-service through the checkout. Keep in mind that this
should be done only if consumers want it. Forcing everyone to help themselves may alienate those
who want to deal with customer service agents.
• Listening and Empathy: Customer service only goes so far if the business listens and empathizes
with the customer. This requires training and skills, along with a certain degree of compassion.
• Being Proactive: One of the key traits of good customer service is being proactive. It's always a
good idea to reach out to customers first rather than waiting for a problem to arise. It shows that a
company cares. This can be done with a simple follow-up email or phone call.
Customer Service Channels

Telephone Historically, the most common way for customers to reach a company.

Brick-and-mortar stores can continue offering customer service in person. Although some consumers
In-Person don't want the hassle of going into a store, there are some who prefer a more personal, face-to-face
experience.

This allows consumers to take matters into their own hands by directing the course of the experience
Self-Service based on their own wants and needs.

Even with all the options available, email is considered a go-to method of customer service. It
Email eliminates the need to wait for an agent and allows the customer to explain their situation.

Opening up the possibility of communication through different social media channels allows
Social Media consumers to communicate through the platform(s) of their choice. It also allows others to see their
interactions with the company.

Companies can reach out to their customers through text messaging to engage before or after any
Text Messages transactions take place.

This option is generally available through a company's website and is an alternative to connecting over
Live Chat the phone.
Customer Service and Automation

• Amazon is an example of a company that is trying to automate a vast

and complex operation. It has to, given that it delivered 4.75 billion
packages to customers in the United States in
• Nevertheless, Amazon still offers 24-hour customer service by
phone, in addition to email and live chat services.
Management of Retail Outlet/Store

• Hiring and training staff: Your employees should be able to complete transactions,
stock goods and answer customers’ questions. When hiring employees, seek
candidates who have good customer service and problem-solving skills.
• Taking inventory: You’ll need to order goods before they run out and ensure that
everything arrives on time. This involves regularly taking inventory to see what’s
selling well.
• Stocking shelves: Customers appreciate visual appeal, and you can create this by
neatly stocking shelves, designing eye-catching displays and keeping goods organized.
• Managing finances: At the end of each day, count the money in cash register drawers
and balance ledgers to ensure transactions are correct.
• Marketing your goods: Actively market your products regularly via social media,
advertising campaigns or special sales.
• Providing excellent customer service: Greet customers warmly, find solutions to
their inquiries and make the experience fun and helpful.
Important areas when managing a store
Customer
experience
• Convenient, seamless experiences: Customers want a
seamless experience that makes shopping quick and easy
without a lot of extra steps. Contactless payment options and
Top-notch customer service is ordering online for in-store pickup are two examples. Making
important to get people to shop your checkout process fast and simple is also helpful.
longer, spend more and come back to • Personalized service: Personalized customer service can also
your store. Customers expect improve the retail customer experience. Train your employees to
employees to be friendly and helpful. focus on each customer individually and read the signs they give
It’s also about the overall experience about how they want to shop. Some people might want a lot of
customers have from the moment they guidance from a salesperson, while others prefer shopping on
step through your door, with 73% of their own.
consumers saying this is the most • Unique in-store experiences: Another way to set your store
influential factor in their buying apart is with unique in-store experiences. You might offer
decisions. The experience is even more samples, do demonstrations, let customers try out products or
important than the price and the offer free consultations.
quality of the product to those • Store appearance: People judge retail stores by physical
consumers. appearance, so presenting your store well can impact the
customer experience. Ensure your store is always clean and
organized. Adding decorative touches that fit your branding can
also make the environment more appealing.
Visual • Spruce up the storefront: Create an interesting storefront to draw
merchandising customers into the store. Some retailers hire artists to create visually
stunning storefronts that stand out from other retail stores.
• Promote hot items: Highlight new merchandise, a promotion or a sale.
Make a prominent display of items you want to push, and use signage to
The way you set up your retail store convince customers to buy those items.
can affect how customers shop. Visual • Use product grouping: Display related items together to encourage
merchandising affects the customer bigger purchases. Putting similar items together helps people imagine
experience and can impact how much using them and makes them want the full collection. The items might
have a similar use, price range or color. For example, in a kitchen store,
customers spend. you might display a pot, utensil set and spice set together. In a clothing
store, you might create a mannequin display showing your newest
running shoes, best-selling athletic shorts and a running belt.
• Engage senses: Shopping is a heavily visual experience, but you can
make it more memorable by pulling in the other senses. Choose
background music strategically to help customers slow down and stay
longer. Create a signature scent that you use in the store to create a
scent memory for customers. Display products that customers can
touch.
• Make it unique: Create unique displays that make customers pause.
Truly unique displays might be interesting enough to get customers to
take pictures and post them online. This can earn you word-of-mouth
advertising.
• Change it up: Customers like variety, and seeing the exact same displays
every time they shop at your store can get boring. Fresh, new displays
shake things up. Instead of going to what they need automatically,
customers might stop and explore the new displays.
Inventory
• The way you display your inventory is also
management important. Logically organized inventory
makes it easy for customers to find what
When managing a store, inventory they want. Tidy, organized shelves eliminate
management involves more than just chaos and create a more relaxing customer
counting the merchandise you have on experience that makes people want to stay.
hand. Keeping popular items in stock is
important, and managing your • Using inventory management software can
inventory helps you do that. help you better control your inventory.
Customers will get frustrated quickly if
the things they want are always out of Inventory software integrates with other
stock. software, such as your point-of-sale
program and accounting software, to
automate inventory management. These
programs help reduce human error and
speed up the inventory management
process to make managing a retail store
more efficient.
Streamlined store
• Keeping up with the multiple operations tasks in a
operations retail setting can be overwhelming. Identifying
every task that needs to be done in a day and
creating checklists for those tasks can help you stay
on track.
• Create a daily schedule of store activities to show
what needs to be done at certain times of the day.
For example, the hour before you open might be
reserved for straightening inventory, tidying the
store and prepping the registers.
• Automating as much as possible can also help you
manage the store more efficiently. Integrated
software solutions are an example. A point-of-sale
program that integrates with accounting software
helps you automatically record transactions.
• Software programs can also help you make
predictions to help with scheduling, ordering and
other retail management tasks.
Get feedback from
employees and • Throughout the year, get feedback from your
customers employees and customers. You can provide
survey materials, such as a suggestion box,
or send email surveys with special discounts
for customers who complete them. Ask
customers what they want to see at the
store, how their experience was and what
they thought about the customer service
they received.
• For employees, ask them what could be
improved at work and what should stay the
same. You might also ask customers for
feedback on ways to improve service,
product selection or placement of items.
Always make sure your employees know that
you want to hear what customers are saying.
 To increase employees’ job satisfaction,
Give positive feedback to motivation and morale, give them
employees
positive feedback. Tell them specifically
what they did well and why it positively
impacts the store. Let them know their
hard work is noticed and appreciated.
Stay organized Plan ahead
• Always plan ahead for the next season. For
example, if you manage a clothing store,
It’s important to stay make sure to order clothing items for both
organized, whether you’re
creating work schedules,
the current season and the upcoming
ordering inventory, managing season.
finances or helping customers. • Likewise, create your employees’ work
Find a system that works for schedules as soon as possible. They’ll
you, whether it’s a digital appreciate knowing their schedule well in
planner or management
advance, so they can make plans around
software.
work.
Store Maintenance

• A retail store refers to a sales place or building where there is

buying and selling of goods and services on small scale. A retailer
is a business person that buys goods on large scale directly from
the company and breaks the bulk. The retailer then sells the
goods to other sellers on a small-scale basis. Retail store
maintenance depends on the type of goods and services that are
sold.
• This is due to factors such as volume, durability, facilities,
equipment, flexibility, and frequency of movement in the
organization. The responsibility of maintaining equipment and
facilities depends on the management and the maintenance team
in the organization. Maintenance is basic as it reduces the risk of
losses as well as unnecessary expenses to maximize profits.
Maintenance strategies include

Organization of shelves and furniture.

There needs to be a systematic way that organizes products on the shelves in the store. Customers and buyers
enjoy an arrangement that ensures flexibility in accessing goods in the store. The retailer may decide to arrange
products depending on sizes, gender as well as alphabetically to ease access to the goods.
The retailer or management is responsible for the overall planning of how goods are laid out and the direction to be
provided to the customers. A conveniently arranged store encourages the customer to come back more often. The
circulation of fresh air is as well enhanced.
Efficient stock-taking depends on the ease to monitor the movement of the store products.
Clean sales floor.
Cleaning is the general outlook of ensuring the cleaning of dust and cleaning the floor using a vacuum.
Maintenance of a retail shop should also include equipment, lighting, and machinery technology.
The issue of sufficient lighting depends on the type of retail store and how much the industry depends on
manpower availability. Customers are easily attracted to clean stores compared to when there is a visible layer of
dust on the shelves or the floor.
The workers in a retail store have a personal responsibility to ensure that cleanliness and hygiene are maintained
such as ensuring there is sufficient lighting and the toilet is always flushed.
Maintaining demand market.
In recent days, following current market trends, there has been stiff competition in every industry. Retailers have
to go the extra mile in ensuring that they conduct proper marketing to ensure that the retail store runs
consistently.
One has the responsibility of ensuring a web of the market is created to reach the market needs as well as the
prospective buyers. Online advertisement on different platforms such as Twitter, Instagram, and Facebook among
other online platforms contributes greatly. Owners of retail stores can link with market trends as well as be able to
meet new wholesalers and investors.
Customer satisfaction is as well enhanced as the retailer fits into the market gap. This works to promote the brand
and keep it at the front of the market need.
Maintenance strategies include

An enabling environment.
This mostly deals with the internal factors in the retail store. The interior factors comprise temperature, music, color, as
well as interior décor. The retail store should be designed to conveniently suit the market need and attract customers.
In cases of high temperatures, the store should be fitted with room fans to create a conducive environment for
customers while at the retail store. That encourages buyers to spend more time at the store and this promotes more
purchases at the retail store. Some stores use music to attract customers to come and view the product on sale.
Depending on the type of store there should be colors that are attractive and concern the product on sale. An example is
when the store is a cosmetic store and bright colors such as white and pink represent the lady products on sale.
Organizational management.
Organizational management goes beyond interior affairs but rather customer satisfaction. There needs to be a smooth
operation in the organization from when the customer walks into the point, the service accorded, and the after-sales
services provided. The workers in the retail store should show a positive attitude to the customer and provide necessary
assistance when need be.
The services provided by the workers influence the need of the customer to visit the store more often. When there is
smooth management the store values its customers as the need to maintain them to be purchased from the store.
Creating a good relationship between the customers as well contributes to customer satisfaction which may include
treatment with decorum.
Quality of goods and services on sale.
The current trend in the present day brings about high competition between existing industries and new industries. When
one wants to maintain their position in the competitive market there is the need to ensure the provision of quality goods
and services.
This is enhanced by ensuring goods are of high quality hence customers may not mind spending whatever amount of
money as long as they get their required quality product.
Customers associate low-quality products with poorly performing stores, there is, therefore, a need to maintain quality
even in the services provided. This promotes customer satisfaction as well as the need to be associated with the quality
provided.
Store security

 Appointment of uniformed security

 Thorough check at entry and exit points
 Without uniformed security guards can be located in the store
 Use of TV cameras can be beneficial to catch the stealers
 Cash deposits in banks must be made frequently
 Brighter lighting should be arranged
 Coordination between all security personnel
 Access to storage areas and ware houses should be restricted
What is Electronic Payment and Its Types?

• E-payments are an electronic or digital way of transferring

funds. Essentially, you can utilize electronic payment
methods to transfer funds as an alternative to cash
payments. In India, you can access various types of
electronic payment methods based on your requirements.
• The various types of e-payment include credit and debit
cards, mobile wallets, UPI, internet and mobile banking, and
many more. You simply require a bank account and an
internet-enabled device to leverage e-payment solutions and
pay for various products and services.
 Advantages of e-Payment?

Time-Saving
E-payments enable you to make purchases with a simple tap or swipe. Transactions are processed and completed
within a couple of minutes. While it is faster than paying with a paper check or other instruments, it also saves you
the time and hassles associated with arranging cash.
Efficient
With electronic payment systems, you do not have to wait in long queues at ATMs or bank branches to withdraw
cash. The lines at checkout counters are also shorter, with each transaction taking less time. You can also use
these online payment systems to pay for a wide variety of products on online shopping websites, thus eliminating
the need to visit stores physically.
Cashless Economy
Another advantage of e-payments is that it helps build a cashless economy, especially in the urban areas of the
country, by reducing the reliance on cash. Reduced cash usage in the urban sectors enables banks to distribute
more cash in the rural parts of the nation where e payments are uncommon.
Security
Cash transactions bring their own set of risks, such as robbery, misplacement, or other similar incidents. However,
electronic payment systems come equipped with security protocols that ensure the safety of your funds. Banks
use highly secure practices like two-factor authentication, PIN (Personal Identification Numbers) and OTPs (One
Time Passwords) to protect your funds from thefts or fraudulent activities.
Certainty
The payments made using e-payment methods reflect in your bank statement or digital wallets. You also receive
instant e-mails and SMS alerts after every transaction. You can check for the credit/debit of funds in your account
based on the chosen method of e-payment. In case funds are debited wrongly, the transaction is reversed within
24-48 hours.
Credit Card Transaction
Credit cards are offered by banks and NBFCs (Non-Banking Financial
Company) to carry out seamless, cashless transactions online and
offline. The credit card lender sets a pre-decided limit on your credit
card based on your income, credit score and other factors. You can use
the credit card for various transactions up to the maximum credit limit.
The credit card bill is regenerated at a regular interval. If you pay the
bill within the due date, interest will not be imposed. However, after this
period, the bank will charge a certain interest rate.
Advantages of a Credit Card

1. Easy Access to Credit

The first benefit that distinguishes credit cards is the ability to obtain credit quickly. When making a purchase, you can use your
credit card to make a quick and easy payment. The bank makes the payment on your behalf, and you can pay the balance when your
credit card bill arrives.
2. EMI Option
Credit cards are excellent for purchasing goods and services with a low monthly EMI. This alleviates the burden of having to pay the
money in one lump sum. Furthermore, EMI payments via credit cards may be more convenient than obtaining a personal loan.
3. Record of Expenses
Every purchase made with a credit card is recorded. Each month, your credit card statement will include a list of your purchases.
This is especially useful for keeping track of your budget and expenses.
4. Exciting Offers and Cashbacks
Most banks offer credit cards with a variety of offers, cashbacks, and rewards. These offers and rewards are available whenever you
make an online or offline purchase. You can also get cheaper air tickets, train tickets, hotel reservations, grocery shopping, and so on.
5. Protection of Purchase
Credit cards provide extra security in the form of insurance for card purchases that are lost, damaged, or stolen. If you want to file a
claim, you can use the credit card statement to back it up.
6. Improving Credit Score
Credit cards allow you to build up a credit line. This is critical because it allows banks to view an active credit history based on your
card repayments and card usage. Banks and financial institutions frequently use credit card usage to assess a potential loan
applicant’s creditworthiness, making your credit card important for future loan or rental applications.
Disadvantages of a Credit Card

1. Habit of Overspending
Although credit cards provide you with adequate credit for a long time, you must be prudent when spending the money. Spending too
much money on unnecessary purchases may lead to a severe debt trap in the future. So, determine your affordability and avoid the
habit of overspending.
2. High Rate of Interest
If you do not pay your credit card bill on time, the bank will charge you interest. The interest rates on these cards are typically high,
with a 3% average monthly rate. However, if the monthly rates are added together, the annual rate rises to 36%.
3. Deception
Your credit card can be susceptible to fraudulent transactions. Thieves or impostors can even steal the details from your credit card
and misuse it for carrying out unauthorized transactions. Your credit card details falling in the wrong hands can lead to serious
financial troubles.
4. Hidden Costs
Credit cards may appear easy and straightforward initially, but they comprise numerous hidden costs that can increase the expense
amount by a high margin. These extra charges can come in the form of late payment costs, renewal fees, processing fees etc.
Nevertheless, if you miss any payment, it can cause a penalty and diminish your credit history.
5. Restricted Drawings
Credit cards, unlike debit cards, do not offer as many benefits when it comes to cash withdrawals. This is due to the fact that some
credit cards charge an additional fee in addition to an annual interest rate of approximately 40%.
6. Minimum Due
The most significant disadvantage of a credit card is the minimum due amount displayed at the top of a bill statement. Many credit
card holders are misled into believing that the minimum amount is the total amount owed, when in fact it is the minimum amount that
the company expects you to pay in order to continue receiving credit facilities. As a result, customers assume their bill is low and
spend even more, accruing interest on their outstanding balance, which can quickly add up to a large and unmanageable sum.
Parties that participate in this process
Cardholder
The cardholder is the individual who owns the credit card and uses it to make purchases for goods or services.
Merchant
The merchant is the business or service provider that accepts credit card payments from customers in exchange for goods or
services.
Point-of-sale (POS) system
The POS system is the hardware and software the business uses to accept and process credit card transactions and includes
terminals, card readers, and software applications.
Payment gateway
The payment gateway is a service that securely transmits transaction information between the business’s POS system and the
credit card processor.
Credit card processor
The credit card processor, also called the “payment processor,” is a company that works with the card networks and issuing
banks to authorize, authenticate, and settle credit card transactions on behalf of the business.
Card networks
Card networks—such as Visa, Mastercard, American Express, and Discover—facilitate communication between the credit card
processors and the issuing banks and set transaction rules and standards.
Issuing bank
The issuing bank, also called the “issuer” or “card issuer,” is the financial institution that issues the credit card to the
cardholder. It authorizes and approves transactions, and it provides the funds for the purchase.
Acquiring bank
The acquiring bank, also known as the “acquirer” or “merchant bank,” is the financial institution that has a contractual
relationship with the business to accept and process credit card transactions. It settles funds with the issuing bank and deposits
the funds into the business’s account.
Smart card

A smart card contains a special embedded microprocessor, which is a

computer processor on a microchip. The microprocessor is located
under a gold pad on the side of the card. Credit cards and smart cards
may have a similar appearance at first glance, but a traditional credit
card only features a magnetic strip and nothing inside. Some credit card
companies have replaced traditional "swipe and sign" credit cards with
smart cards to help curb fraud and protect you from hackers.
Advantages of Smart Cards

Advantages Advantages

High levels of security Through the Internet, smart card users can buy and
pay for computer network
Reduced fraud Ensuring economic operations, 100% effective theft-
proof.
Organized information Falling costs for operators and users.
Reliability Specific standards ISO 7810, 7811, 9992, 10536.
Upper management information Multiservice smart cards
Information Security Privacy
Ease of use without need for connections online or via Administration and control over cash payments.
telephone
User comfort Represent liquidity
Larger memory
Disadvantages of smart cards

A more powerful virus

Discomfort to retrieve information from a stolen card Dependence of electrical energy for use
For its size can be easily misled Vulnerable to fluids
The card must be recharged Bank fees associated with smart card
Increased cost of production We need a smart card reader
Types of Retailing Formats
Super Market, Hyper Market, Departmental Stores, Convenience
Stores, Catalogue Retailers. Non Stores Retailing: Vending Machine,
Door To Door selling, Mail Order Business
Types of Retailing Formats
Super Markets

Supermarkets are self-service stores that sell a wide range of food as well as non-food products.
supermarkets have at least four basic departments such as self-service grocery, dairy produce,
meat, and household department.
These stores can be either entirely operated by owners or they are given on lease to others to
operate.
Features of supermarkets
o Goods are displayed in bulk.
o Supermarkets are located in nearby housing areas so that people have easy access.
o These stores offer a wide range of products, low prices, nationally advertised brands, and also
convenient parking.
o It follows the “cash and carry” policy.
o Minimum customers service is provided in these stores as these stores work on the basis of
self- service.
Super Markets

Advantages of Supermarkets
o Formats of retailing
o The supermarket sells a wide variety of merchandises.
o The supermarket offers convenient shopping to customers as they can buy everything
under one roof.
o supermarkets offer low-profit margins, high discounts, and convenience of buying
everything under one roof.
o Customers don’t have to spend a lot of time.
o Also Read Individual Marketing and its Impact on Today's Business Environment
Disadvantages of supermarkets
o Fewer customers services.
o Products which require instruction to use are difficult to purchase from supermarkets as
there is no one to assist you.
o High administrative expenses required to run a supermarket.
Hyper Market

A hypermarket or a hyperstore is a place designed to fulfill the routine

shopping requirements of a consumer in a single trip. The concept of
hypermarket refers to a retail store which combines departmental stores and
grocery supermarkets. It is often a very large establishment that provides a
wide range of products, such as groceries, clothing, appliances, etc., all in one
place.
Fred G. Meyer founded the first hypermarket named ‘Fred Meyer’ in
Portland, Oregon, USA by Fred G. Meyer in 1922. So, the origin of
hypermarkets can be documented to have started 101 years ago.
Hypermarkets are similar to big-box stores that are physically large retail
establishments. The ‘big-box’ term is derived due to the typical large
appearance of the building occupied by the hypermarket.
 Features of Hyper Market
Long operating hours
Hypermarkets are open to late hours on all days to help customers buy products conveniently.
This way, the customer does not have to wait for a day off from work or free time to do shopping.
Parking space
Customers can be carefree about the availability of parking space for their vehicles when they
visit hypermarkets.
Increased checkout points
There are many payment counters available to handle the volume of customers and ensure that the
customer can make payments quickly. Some hypermarkets also have self-checkout stations to
further speed up the checkout process.
Bulk storage
Hypermarkets store goods in bulk. There is the availability of plenty of stock of material to make
bulk volume purchases by customers.
Advantages of Hypermarkets

o Offer extensive parking for customers

o Customers can do all their shopping in one building , especially those
who buy their monthly supplies in bulk
o They save on space, which reduces rents and rates
o Usually open for long hours
o They provide credit facilities by accepting credit cards
Disadvantages of Hypermarkets

o Since they are located away from the city centers, they serve only a
limited number of people especially those with cars
o Require a large space which is not available in the Central Business
District (CBD)
o Their prices are not controlled and therefore subject to bargaining
Departmental Stores

Department stores are large stores which sell different types of products under one roof in
different departments. Each department has an individual specialization of merchandise.
Each store is handled separately in accounting, management, and location.

Therefore, a department store handles different business units and deals with a variety of
merchandise and are organized in different departments for the purpose of accounting
control, sales promotion, and store operations.

The latest trend in department stores is to add departments for sports and recreational
equipment and automotive along with providing services like travel advice, insurances,
and income tax preparations, etc. Department stores can also be referred to as shopping
centers.
Types of Department stores

1.Chain Department Stores – This type of stores is owned and

managed centrally.
2.On the basis of income groups – These stores are designed to serve
people with high- and middle-income groups. These stores sell high-
quality goods and provide first class services to its customers. there
are also stores which are designed to cater to people with low income
such as dollar stores.
3.Leased department stores – The stores whose operations are given
out on lease are called leased department stores.
Features of Department stores

o Merchandises are arranged in different departments in the same store.

o Department stores are integrated stores which perform operations.
o department stores are distinguished by the nature of goods sold by
them, not by the variety of goods sold by them like drug and variety
store.
o Department stores are designed horizontally in order to provide
different merchandises under the same roof.
Advantages of Department stores

o Department stores usually buy products in bulk which gets considerable discounts.
in addition to this, department stores buy directly from the manufacturer
therefore, it eliminates any middleman charges results in high profits.
o Department stores were a big business are in a position to pay for goods being
purchased. In this way, quality goods can be purchased on much cheaper rates and
also merchandise of the latest style and design can be obtained to be sold in stores.
o Department stores attract customers because of the convenience offered by them
for people of all classes.
o Because of its large scale of business expert supervision can be provided for each
department. In addition to this, various services like liberal credits, expert
assistance for shopping, and delivery services can be provided to customers.
o Department stores can afford to spend on advertising to lure customers to buy
more. For example, within department stores, various discount and offer
advertisements are placed to make customers purchase more than they plan to
buy.
Limitations of Department stores

o It is very expensive to run a department store as it includes various expenses.

For example, a large number of salespersons are needed to handle different
departments and cash counters.
o Because of its large size, personal touch and interaction with customers are
missed. Which is not a problem in single line stores.
o As area required to establish these stores is large, they are usually set up on
the outskirts of a city. Hence, these are not much beneficial for the
customers as they have to buy urgently required goods from the nearby
traders.
o As the whole control is in the hands of employees such as store managers
there are high chances of leak and loss.
o Many times customers take advantage of “customers are always right” policy.
o it has been observed that in many stores poor salesperson service is provided
because of the low payments given to them.
Convenience Stores

• A convenience store is a small retail business which stocks everyday

items which the average person uses. It may range from snack foods
to toiletries to tobacco products. In the United States, convenience
stores are often associated with fuel stations. They are often located
along busy roads or at important intersections in a community.
• Convenience stores also go by a number of different names. They may
be referred to as corner shops, party stores, corner stores, or c-stores.
In 2011, convenience stores reached a record $195 billion in total
sales. When combined with motor fuel sales, U.S.-based convenience
stores are responsible for about 5% of all dollars in the GDP.
 Advantages of Convenience Stores

1. They are a natural destination retail location.

Convenience stores are placed in locations that are convenient for local customers. They are a natural destination point for the neighborhood in
which they are located. If someone requires a couple of items that doesn’t justify a trip to the local grocery store, then a trip to the convenience
store down the street makes more sense. Although the prices at a convenience store tend to be a little higher, customers spend less to get there,
which creates a pricing balance.
2. It provides an economic boost to the community.
Convenience stores have stable revenue streams because of the nature of their business. People stop by these stores because they are
convenient, having what they need to get through their day. Many locations offer gasoline for sale as well, along with propane or kerosene, which
generates more local economic activity. Convenience stores provide employment opportunities, business ownership opportunities, and are
relatively recession-proof in most locations.
3. It doesn’t cost much to start a convenience store.
Although the cost to start a convenience store business which includes fuel at an important location in a community may cost over $1 million, it is
also possible to start a store for around $10,000 in the United States. Much of the cost variation depends on if you’ll lease or own the property, if
there is an existing business in place you can take over, and if there are franchising fees involved.
4. Convenience stores are not bound by local pricing needs.
The benefit of a convenience store, from an ownership perspective, is that pricing is independent of recommended systems. Most customers are
willing to pay a little more for the convenience of being able to purchase a wanted item close to home. Convenience stores can also provide an
outpost for travelers, which allows for higher pricing because providing access to needed items saves time for the traveler, which is valuable to
them. Even if there are multiple stores within a 5-mile radius, a convenience store will generate a loyal following, which creates income for the
owner.
5. Franchises are often available.
About 40% of the convenience stores operating in the United States are connected to a franchise opportunity. That equates to almost 60,000
convenience store locations. Although the cost of purchasing a franchise is similar to the cost of purchasing an established store, the actual costs
are much lower than if you were creating your own brand. Most franchise owners become profitable faster than independent owners, and there
is internal training and support offered by the franchising company.
 Disadvantages of Convenience Stores
1. Long operational hours are often required.
Most convenience stores open early in the morning, then close late at night. Several stores are open around the clock to meet the
needs of their local customers. That creates a staffing challenge for a store that is independently owned and operated. Trying to find
employees to work specific shift hours that are early in the morning, or during the overnight, can be expensive. Trying to fill those
hours personally can lead to higher levels of stress.
2. They are often targeted by the local criminal element.
Any retail location faces a risk of theft in multiple ways. Shoplifters may come into the store to steal food items they want. Criminals
have targeted ATMs in convenience stores, causing damage to the building. There is always the threat of an armed robbery for cash
in the register as well. Outside of the store, these locations may be used as a site for illicit drug transactions and other criminal
actions. Even with a strong security system in place, up to 6% of the budget for a convenience store should be dedicated to cover
losses which may occur.
3. Cleaning and maintenance are frequent requirements.
Convenience stores see a lot of traffic every day. That means people are coming in and out of the store, tracking in dirt and debris,
which must be removed for health concerns. You’ll have product vendors coming in and out of your store as well, along with
equipment maintenance needs which require multiple inspections. A lot of time goes into preventative maintenance when operating
a convenience store, which can eat into the tight profit margins that some stores have.
4. Convenience stores experience inventory losses.
Expired foods have become an increasing component of the diet for many Americans. Forbes reports that food banks are seeing
requests for emergency food assistance rise by up to 40% in just 12 months. Although stores can make some money back by selling
expired products to salvage food centers, or donate items to a food bank, it is inevitable that some of the food products will end up
in a landfill. If inventory losses are not managed appropriately, the cost can be steep enough that it may affect the profitability of the
business.
Disadvantages of Convenience Stores
5. These stores sell what people want more than what they need.
To be fair, people don’t really need candy, beer, energy drinks, or cigarettes. These are items that they want. If someone
is trying to break a bad habit which is affecting their health, a recommendation to avoid the local convenience store is
not uncommon. Except for the fuel that some stations provide, the rest of what can be found for sale at these stores is
more about wants instead of needs.
6. Prices at a convenience store can be triple the going rate in the community.
Visiting a convenience store on a frequent basis can create a budgetary crunch for some consumers. Almost everything
is priced higher at a convenience store because of its convenient location. You might pay the same price for a handful of
ibuprofen tablets at the convenience store as you would for a whole bottle over-the-counter at the local pharmacy.
Some items may be priced triple of what they are at the local store. Add in the fact that many food items are filled with
strong preservatives and the shopping experience may not be very healthy for some individuals.
7. Some convenience stores charge to use debit or credit cards.
Convenience stores often charge a premium for using a debit or credit card. These fees may be posted on the counter by
the register, then are posted nowhere else in the store. Once a customer grabs what they want, it doesn’t make sense to
put it all away for a $0.35 surcharge. Taking money out at the ATM could cost up to $5 at the convenience store. Many of
the fees may seem small, but if you visit once per week and pay with credit, you’ll be paying over $18 in fees.
8. Franchising with a convenience store involves long-term fees.
Franchises require more than an initial investment to use the branding. There are ongoing royalties which must be paid
to the franchise as well. Owners must all use established practices by the franchise to operate their business, which
limits their personal influence on the store. The equity of the business, along with its reputation, are tied to the
franchise brand as well. If the parent company receives a lot of bad press, that will affect the revenues generated at the
local level.
Catalogue Retailers
Catalog marketing is a direct marketing technique in which businesses or sellers prepare print
or online catalogs to showcase a range of products together to sell at least one item directly to
the target customer. It is a type of sales technique businesses use to sell their products using
catalogs. The list of items sold by the company is mentioned on a piece of paper or on an
online platform in the hope that the receiver will buy one or more things from the catalog.

Some catalog marketing examples are mail-order catalogs, clothing catalogs, furniture and
appliance brochures, etc. Amazon, eBay, and other online stores also use promotional catalogs
as effective marketing tools.

The sender of the catalog provides contact information such as a contact number, contact
email, or physical address on the catalog. The recipient of the catalog places orders through
one of these contact methods provided by the sender. For example, the recipient can place an
order for the products that he wants by calling the sender. Companies that produce several
products prepare catalogs and take orders from the buyer directly. Otherwise, catalog
marketers act as intermediaries between the buyers and the manufacturers.
Advantages of Catalogue Retailers
o Easy to reach hundreds and thousands of potential customers just by sending one mail.
o You don’t wait for your people to come to your store to make a purchase. You can send
them details about your products and offers using catalog marketing.
o Low risk of failure of the business. A catalog business grows slowly. In this way, as a
retailer, you can start your business by making little investment in the beginning.
o Better cash flow as buyers are required to pay in advance if they want to buy something.
Hence, you don’t need to worry about your money getting stuck.
o Better control over advertising expenses as you are spending your money to advertise to
only targeted customers rather than advertising to the mass population.
o With catalog marketing, you can keep checking on the Return on Investment (ROI).
Disadvantages of Catalogue Retailers
o Catalog businesses grow slowly because sellers are required to win the trust of their
customers to convert them into loyal customers.
o The high initial investment of catalog marketing is because the seller is not only
needed to produce catalogs but also required to buy the list of prospective customers.
o Low response rate. People are less responsive to catalog marketing because of the
availability of different shopping platforms.
o You require excellent writing skills to write details about the products. A poorly
written catalog will create a negative image of your products.
o Catalog marketing business is always at a disadvantage when it comes to comparing
with brick and mortar businesses. Because in a store, a buyer can try and physically
see the products before buying them, which is not possible when you sell products
using catalogs.
Vending Machine
A sale is made without the slightest contact between a seller and a buyer through automatic
vending. The idea behind selling through automatic vending is to provide convenient purchase.
Products from well-known brands and those have great turn-over are usually sold through
automatic vending machines.
Most of the selling from automatic vending comes from “4 Cs”: Coffee, Cold Drinks, Cigarettes,
and candies. A vending machine is an appropriate way to expand business by reaching customers
to such locations where there are no stores nearby or when they can’t come to a store.
The vending machines are installed in places like schools, colleges, workplaces, public facilities,
etc. However, it is expensive to operate vending machines as they are required to replenish
frequently.
In addition to replenishment cost, there are other costs of repairs and maintenance. The above-
mentioned difficulties could be a reason for less scope of vending machines in the future.
moreover, frequent vending-related scams scare entrepreneurs spending in this retail format.
However, various innovations are made to make vending machine business more lucrative for
customers such as purchase using debit cards.
The amount of purchase is deducted from the cardholder’s card. Technological advancement
made it easy to monitor vending machines from distance and reducing the chances of out-of-
stock, out-of-order, and theft incidences.
Door To Door selling
Door-to-door sales is a sales technique where the sales team visits potential
customers in their homes. The salesperson will try to sell the product or
service to the customer directly.
Products commonly sold door to door in the US includes vacuum cleaners,
solar panels, pest control services, energy services, home security systems,
etc.
In many cases, the salesperson will offer a free product demonstration. They
may also provide a special deal or discount if the customer buys the product.
Door-to-door sales can effectively reach potential customers who might not
otherwise see your product by using other methods.
However, it is essential to remember that not everyone enjoys being visited
by strangers in their homes. It is crucial to be polite and respectful when
selling door to door and to take no for an answer if a customer is not curious.
Advantages of Door-to-Door Selling
Accessibility
First, it allows you to reach potential customers who might not be accessible through other means but might be willing to pay the cost or become
your lead this way. This can be especially beneficial if you deal with products or services that are niche or not well known.
Opportunity
The second advantage, door-to-door sales allows you to build relationships with potential customers in a way that's difficult to do with other
marketing channels. This way, you can market your new services, if any, and get more outbound leads in the given period. When you meet
someone face-to-face and make eye contact or take time talking to them, they're more likely to remember you and your product, which can lead
to future sales down the road.
Instantaneous
Finally, door-to-door sales provide immediate feedback about your product or service. If people aren't interested, you can quickly move on to the
next house. This is beneficial because it allows you to fine-tune your sales pitch according to your target audience while addressing the pain
points for every person you encounter and ensuring that you are marketing something that people want.
Flexibility
One of the biggest benefits of door-to-door sales is that you can control your income. If you want to make more money, you can expand your
sales team. The conversion rate of door to door sales is 2-3 percent, which is much higher than other marketing channels. This means that if you
sell to 100 people, you can expect two to three sales. If you want to make more money, you can increase the number of homes you visit each day.
Its a numbers game!
Meet New People
Another one of the benefits of door-to-door sales is that you get to meet new people, which means new clients. This can be a relevant process to
network and build relationships with potential customers. It can also be a great way to learn about new products and services.
Earn Commission
The Door to door sales representatives have the opportunity to earn a commission on every sale that they make. This can be a great way for door
salesperson to supplement income and make some extra money. Overall, door-to-door sales can be a great way for companies to reach potential
clients, advertising your product, get sales and meet new people, and finally, grow your business.
What are the cons of door-to-door sales? Keep reading to find out.
Disadvantages of Door-to-Door Selling

Time Consuming
The main con of door-to-door sales is that it can be very time-consuming. It can take a lot of time to walk from door
to door, and oftentimes you will end up knocking people's doors who are not inquisitive about what you're selling.
This can be frustrating, and it can be difficult to stay motivated and have confidence when you're not seeing any
results.
Intrusive
Door to door sales can also be a means of marketing your products or services. One of the reasons why companies
consider digital marketing over door to door sales is that some people simply don't like being approached by
strangers at their door. This can make door-to-door sales a very difficult and uncomfortable experience for both the
seller and the potential customer and it might even create a bad image of your company for them.
Frustrating
Lastly, door-to-door sales can be extremely frustrating. A lot of times, people just aren't interested in what you're
selling whether it mobile phones or solar installation service.
And even if they are, there's no guarantee they'll actually make a purchase. It takes a lot of persistence and thick
skin to be successful in this type of sales.
Mail Order
Mail order is the buying of goods or services by mail delivery. The buyer places an order for
the desired products with the merchant through some remote methods such as:
o Sending an order form in the mail
o Placing a telephone call
o Placing an order with a few travelling agents and paying by installments
o Filling in a form on a website or mobile app — if the product information is also mainly
obtained online rather than via a paper catalogue or via television, this model is online
shopping or e-commerce

Then, the products are delivered to the customer. The products are usually delivered directly
to an address supplied by the customer, such as a home address, but occasionally the orders
are delivered to a nearby retail location for the customer to pick up. Some merchants also
allow the goods to be shipped directly to a third party consumer, which is an effective way to
send a gift to an out-of-town recipient. Some merchants delivered the goods directly to the
customer via their travelling agents.
Advantages of Mail Order

o Less capital Requirement

o A wide market
o Unusual buying power
o No risks of bad debts
o Efficient use of capital
o Managerial specialization; and
o Consumer convenience.
Disadvantages of Mail Order
o 1. There is lack of personal contact between the seller and the buyer. It cannot meet the
unexpected objections raised by customers. It cannot give personal advice and assurance that
the goods sold by mail will satisfy the requirements of customers.
o 2. There is scope for fraud, inconvenience due to delay, misunderstanding of customers, etc.
o 3. Mail order houses are confronted with the problems of numerous correspondence,
customer complaints, damage in transit, return of articles, excessive operating cost, credit
policies, etc.
o 4. In mail order business, wide distribution of catalogues is essential. Colorful catalogues are
expensive and are to be printed in advance. Supplementary catalogues will have to be issued
to announce price changes and new offers.
o 5. Buyers have to rely wholly upon catalogues to know about the goods. They cannot inspect
the goods before buying them.
o 6. After sale service is not extended to customers.
o 7. Sometimes, the mail order houses charge high prices for the articles sold.
o 8. Articles requiring demonstration cannot be sold by mail.
Future of Retailing

Customer Service strategies, Retail Sales Promotion, Retail

Communication, Building Customer Relationship. Franchising-
Definition, Types and Evolution, Franchising Law in India. Outsourcing:
Definition, Scope and Importance, introduction of the Concept of VAT in
Retailing. CRM in Retail: Concept, Types of CRM, Application of CRM in
Retailing, Strategic Framework for CRM in Retail.
Customer Service strategies
Retail Sales Promotion

The variety of sales promotions in retail is limited by only the creativity

of the marketer. That’s to say, if you can imagine a way to convey value
to the consumer, you can create a compelling promotion. That said, it is
best to focus on value and simplicity. Simplicity ensures that consumers
easily understand the offer and qualification. When promotions are
made complex, either by requirements or by timing, they reduce the
likelihood of participation.
Some common retail sales promotions

Price discounts
Value, e.g. “x now $1.99”
Value off, e.g. “Save $1.00”
Percent off, e.g. “25% Off”
BOGO, i.e. Buy one, get one
Buy One, Get ___, i.e. a derivation of BOGO, but the “get’ can be adjusted for another
value like “50% off” or “for only $3”
Price Multiples, e.g. 2 for $4.00 or 4 for $5.00
Rebates, i.e. manufacturer discounts that can be applied at the point of purchase or after
customer action like mail-in
Coupons
Bonus packs, i.e. sellable units with extra pieces
Trial packs, i.e. sellable units with a free sample of a related item
Retail Communication
Retail Communication
Building Customer Relationship
Franchising

Franchising is basically a right that manufacturers or businesses give to

others. This right allows the beneficiaries to sell the products or services
of these manufacturers or parent businesses. These rights could even be
in terms of access to intellectual property rights.
Franchising is a business relationship between two entities wherein one
party allows another to sell its products and intellectual property. For
example, several fast food chains like Dominos and McDonalds operate in
India through franchising.
Franchising- Types

Manufacturer-Retailer Franchise
Manufacturer-Wholesaler Franchise
Wholesaler-Retailer Franchise
Service Sponsor-Retailer Franchise
Franchising- Types
1. Manufacturer-Retailer Franchise:
Franchisee acts as a retailer who sells directly to the consumers. This is the most
common form of the franchise system, e.g., McDonald’s, Raymond’s, etc.
2. Manufacturer-Wholesaler Franchise:
Franchisee acts as a wholesaler who distributes to the retailers, e.g., Coca Cola, Pepsi.
The companies get license for bottling of these brands.
3. Wholesaler-Retailer Franchise:
Wholesaler gives franchise to individual retailer or a group of retailers. Retailer sets
up a franchise system and shares the ownership and operations of a wholesaler. This
system works well when the wholesaler is more powerful and influential than the
manufacturer. Big wholesalers who are established can give franchise to the retailer
to sell their product assortments.
4. Service Sponsor-Retailer Franchise:
A service firm licenses individual retailers to offer specific service packages to
consumers. For example, VSNL gives license to many small computer firms to sell its
Internet Connection Service/ Internet Service Provider (ISP) facility.
Franchising Law in India
Consumer demand is poised for growth in India, especially since there
is a largely unserved market to be capitalised in tier-2 and tier-3 cities.
India does not have a franchise law, hence an interpretation of the
definition can be inferred from the Finance Act, 1999 in the context of
service tax, which has since been repealed following the introduction of
goods and service tax (GST). From the Finance Act, 1999, one can
define a franchise as an agreement that grants the franchisee the right to
sell or manufacture goods, provide services, or undertake any process
identified with the franchisor, whether or not a trademark, service mark,
trade name or logo, is involved.
Franchising Law in India
• The Indian Contract Act, 1872.
• The Foreign Exchange Management Act, 1999 (FEMA).
• The Competition Act, 2002.
• The Trademarks Act, 1999.
• The Copyright Act, 1957.
• The Patents Act, 1970.
• The Design Act, 2000.
• The Income Tax Act, 1961.
• The Arbitration and Conciliation Act, 1996.
• The Specific Relief Act, 1963.
• The Information Technology Act, 2000.
Outsourcing

Outsourcing is a business practice in which services or job functions are

hired out to a third party on a contract or ongoing basis. In IT, an
outsourcing initiative with a technology provider can involve a range of
operations, from the entirety of the IT function to discrete, easily
defined components, such as disaster recovery, network services,
software development, or QA testing.
Companies may choose to outsource services onshore (within their
own country), nearshore (to a neighboring country or one in the same
time zone), or offshore (to a more distant country). Nearshore and
offshore outsourcing have traditionally been pursued to save costs.
Outsourcing services

Business process outsourcing (BPO) is an overarching term for the outsourcing of a specific
business process task, such as payroll. BPO is often divided into two categories: back-office
BPO, which includes internal business functions such as billing or purchasing, and front-
office BPO, which includes customer-related services such as marketing or tech support.

IT outsourcing is a subset of business process outsourcing, and it falls traditionally into one
of two categories: infrastructure outsourcing and application outsourcing. Infrastructure
outsourcing can include service desk capabilities, data center outsourcing, network
services, managed security operations, or overall infrastructure management. Application
outsourcing may include new application development, legacy system maintenance,
testing and QA services, and packaged software implementation and management.

Today, however, IT outsourcing can also include relationships with providers of software-,
infrastructure-, and platforms-as-a-service. These cloud services are increasingly offered
not only by traditional outsourcing providers but by global and niche software vendors or
even industrial companies offering technology-enabled services.
Importance of Outsourcing
VAT
Features of VAT
CRM
A retail CRM solution is a customer relationship management system that's built
specifically for retail businesses to keep track of their customer segments and leads.

A CRM for retail will include data and features like:

o Customer profiles with contact details and product preferences for each of buyers
o Credit card and other payment information a buyer has provided
o Automated email reminders on when to reach out to a key customer
o Omnichannel order history so sales associates can see when and where a shopper
has purchased an item from your store—whether at your brick-and-mortar store or
online
o Social media integrations to easily promote product releases and sales
o Filters and tags so you can easily segment customers and leads
o Lead tracking to give insight on where a lead is at in the sales process
Types of CRM

1. Collaborative CRM systems

A top focus of collaborative CRM systems is breaking down silos. Often the marketing team, sales reps,
and customer support agents are all in different departments that feel disconnected. And for bigger
organizations, each of those departments is further separated based on factors like geographic locations,
channels they serve, products they focus on, or skill specialties. But in order to provide a seamless
customer experience throughout the customer’s journey, you need a way to share information across the
full organization in real-time.
Collaborative CRMs ensure all teams have access to the same up-to-date customer data, no matter which
department or channel they work in. Not only does customer support have all the information marketing
and sales teams collected when working with a prospective customer, but agents in a call center have
updated data on customer interactions that happened over email or messaging channels.
Collaborative CRM treats each interaction as part of a larger, integrated conversation between the brand
and the customer. That integration between departments and channels saves customers from the dreaded
experience of repeating themselves each time they talk to a new contact. Each employee they interact with
can quickly and easily pull up a record of all past interactions with the consumer to consult and learn all
relevant details.
Types of CRM

2. Operational CRM systems

Operational CRMs help streamline a company’s processes for customer relationships.
They provide tools to better visualize and more efficiently handle the full customer
journey—even when it includes a high number of touchpoints. That starts from their
first interactions with your company’s website, through the whole lead management
process as they move through the sales pipeline, and continues with their behaviors
once they’ve become a customer.
Operational CRM systems typically provide automation features. Marketing
automation, sales automation, and service automation offload some of the work that
your employees would otherwise have to handle. That opens up their schedule for the
more creative and personal aspects of their jobs—the stuff that needs a human touch.
And it makes it much easier for growing companies to continue to provide top-notch
service to scale.
Types of CRM

3. Analytical CRM systems

Analytical CRMs have the primary focus of helping you analyze the customer
data you have to gain important insights. Digital tools and platforms now make
it easy to collect large quantities of data. But data analysis—the step required to
turn that data into something useful for your company—is a difficult feat. In
fact, estimates suggest that over half of the data collected by companies never
gets used.
Your customer data is too valuable for that. An analytical CRM provides
features that help you use the data you have to see trends in how your
customers behave. With that information, you can better understand what steps
lead most successfully to sales, which increase customer retention, and what the
most common customer problems are.
Application of CRM in Retailing

A model for CRM implementation; this model is defined based on these

five basic factors:
1- Making customer database.
2- Data base analysis.
3- Customer classification and choosing appropriate strategy.
4- Determining how to communicate with specific customers.
5- Evaluation success gages.
Strategic Framework for CRM in Retail