2. A retailer purchases
goods or products in
large quantities
from manufacturers
directly or through a
wholesale, and then
sells smaller quantities
to the shoppers for a
profit.
8. Developing countries
becoming more attractive
for Global retailers than
developed countries.Wal
Mart, Carrefour,TESCO &
Metro saw double growth
in developing vs.
developed countries.
9. Key For Retail Understanding
Understanding Factors of Profitability
13. In the broadest
sense, merchandising is any
practice which contributes to
the sale of products to a retail
consumer. At a retail in-store
level, merchandising refers to
the variety of products
available for sale and the
display of those products in
such a way that it stimulates
interest and entices customers
to make a purchase.
Retailer Creates Mixes of Wants & Needs along with
Aspirations – Result Increased Basket Size
14. Motivating more shoppers to
buy more, more often
Retailers use brands to drive traffic in the outlet
Private Label is tactic to drive margin
Loss leaders used to drive traffic
Ultimate mix of traffic drivers and money makers
in a bigger basket
18. Sales growth is not enough with the leading
retailers
New way is to think about growth from a
financial perspective
Increase ROI on new store opening
Traffic drive BTL activities are most valuable
Not all the retailers have same needs
Gross margin is critical first step towards
profitability
21. Fast & Efficient Front End Service
A close check of pilferage and theft by
the labor
Company merchandising team
(Displaying and managing product on
shelves for the retailer)
Single biggest operating
expense
22. High Efficient inventory picking is the key
Pallets for bulk and efficiency
On Time delivery to retailers and preferred
offloading by the retailer for the company is
important for both stakeholders
24. Gross Inventory
• Value of inventory that the retailer has
on hand
Net Inventory
• Portion of inventory that retailer
actually owns (i.e. less trade payables)
Two types Of Inventory
Always refer to Net Inventory when
communicating with retailers
25. Retailers are trying to reduce inventory size in the back room
Suppliers need to balance their will to push vs. the actual
inventory required for satisfactory service levels
Modern Traders charge suppliers for out of stock
on shelf so suppliers needs to be cautious
26. Challenge Maximize in stocks while
minimizing inventory, sell more with less
Measure of speed at which
inventory moves through the
stores
Suppliers need to improve their
promotional planning and forecasting,
don’t push stock & understand customers
inventory management strategy
28. Invest in warehouse, software updates, new
stores and remodeling etc
Investing today for future
revenues
Retailers will manage stores by
Reducing number of assets in store e.g. freezers,
fixtures
Expanding formats
Maximizing store space (departmental concepts etc)
