MT303 Unit 3. Welcome to MT- 303 Store Management Seminar Dear Students, The Seminar will start...
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Transcript of MT303 Unit 3. Welcome to MT- 303 Store Management Seminar Dear Students, The Seminar will start...
MT303Unit 3
Welcome to MT- 303Store Management Seminar
Dear Students,
The Seminar will start promptly at the Schedule Time.
Remember that the system saves a transcript of everything in the Chat, if you wish to talk among yourselves you may do so, or you may use the Private Chat Option.
Dr. Nardi
Welcome to MT- 303Store Management
Unit 3- SeminarProfessor: Dr. Nardi
TYPES OF RETAILERS
Note: This seminar will be recorded by the instructor.
Agenda
Announcements Unit 2 – Review Unit 3 Topics
Trends in Retail Types of Retailers Non-retailers Services Types of Ownership
Unit 3 – Assignments Wrap Up
Announcements
Good work your discussion posts and quizzes.
Start working on your Research Papers Never to early…..
Our Usual Reminder: Before a question please type ?? Or //
Unit 2
How did it go? Time management? Questions : Grades Review?
Getting familiar with it? Project/Written assignment
Have you started doing research? Have you approached a Store Manager?
Other questions? Concerns?
Review from Last Week What is retailing?
Distribution Types
Selective, Intensive, exclusive Supply Chain
How retailers add value?
Retail differences across the world.
Ethical issues in retail
Career opportunities in retail.
Relationship Management
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Any Questions??
2-9
General Trends in Retailing
New Types of Retailers
Increased Concentration
Globalization
Growth In Services Retailer
Demise of Pure Electronic Retailers (Webvan, eToys, etc)
Growth in Use of Multi-Channel Retailing by Traditional Retailers
Increase Use of Technology to Reduce Cost; Increase Value Delivered
2-10
Types of Retailers Retailers Use Different Retail Mixes
-merchandise: variety (breadth) / assortment (depth)
-services
-store design, visual merchandising
-location
-pricing
Infinite Variations
Some combination of retail mixes satisfy the needs of significant segments and persist over time.
2-11
Types of Merchandise Retailers
Mom and Pop Stores
Convenience Stores
Supermarkets
Supercenters
Department Stores
Specialty Stores
Discount Stores
Category Specialists
Off-Price Retailers
Warehouse Clubs
Value Retailers
Food Retailers General Merchandise Retailers
2-12
NAICS Codes for Retailers
2-13
Merchandise Offering
Variety (breadth of merchandise): wide vs. narrow
- The number of merchandise categories
Assortment (depth of merchandise): deep vs. shallow
-the number of items in a category (SKUs)
2-14
Variety and Assortment of Kayaks in Different Retail Outlets
2-15
Services offered
Retailers differ in the services they offer customers EMS offers assistance
in selecting the appropriate kayak and repairing them
VS Outdoorplay.com and Wal-Mart: doesn’t
provide any services
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Any Questions??
2-17
Prices and the cost of offering breath and depth of merchandise and services
Stocking a deep and broad assortment (like EMS) is costly for retailers.
Many SKUs
Inventory Investment Cost
Because the retailer must have backup stock for each SKU in addition to holding the inventory
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Any Questions??
2-19
Food Retailers
■ Supermarkets■ Supercenters■ Warehouse
Clubs■ Convenience
Stores
Channel preference for food shopping channel where grocery purchasers do most of their food shopping
Food retailers
2-20
Supermarkets
Conventional supermarkets 30,000 SKU
Limited assortment supermarkets (extreme value food retailers) 2000 SKU Offer one or two brands and sizes Designed to maximize efficiency
and reduce costs Offer merchandise at 40-60% lower
prices than conventional supermarkets
Save-A-Lot, ALDI (German’s Wal-Mart)
2-21
Trends in Supermarket Retailing
Competition from Discount Stores
Changing Consumption Patterns
Efficient
Distribution Lower Costs Lower Prices
Time Pressure Eating Out More Meal Solutions
Trends in Supermarket retailing
2-22
Conventional Supermarket Survival Pack
Chef-crafted meals on the go at EatZi’s
Emphasize Fresh Perishables Wegmans
Target health conscious and ethnic consumers
Provide a better in-store experience
Offer more private label brands
2-23
Supercenters and Warehouse Clubs
The fastest growing retail category
Large stores (150,000 – 220,000 square feet) that combine a supermarket with a full-line discount store
One-stop shopping experience
Supercenters
■ Offer a limited and irregular assortment of food and general merchandise with little service at low prices
■ Use low-locations, inexpensive store design, little customer service
■ Low inventory holding costs by carrying a limited assortment of fast selling items
Warehouse Clubs
2-24
Convenience Store
Tailors assortments to local market
Makes more convenient to shop
Offers fresh, healthy food
Fast, casual restaurants
Financial services available
Opening smaller stores closer to consumers (like airports)
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Any Questions??
2-26
Types of General Merchandise Retailers
Department Stores
Specialty Stores
Category Specialists
Home Improvement Centers
Discount Stores
Drugstores
Off-Price retailers
Extreme Value Retailers
Types of General Merchandise Retailers
2-27
Issues in Department Store Retailing
Competition
-Discount Stores on Price
-Specialty Stores on Service, Depth of Assortment
Lower Cost by Reducing Services (?)
-Centralized Cash Wraps
More Sales (?)
-Customers Wait for Sale
Focus on Apparel and Soft Home
Develop Private Labels and Exclusive Brands
Issues in Department Store Retailing
2-28
Three Tiers of Department Stores
First Tier: Upscale, high fashion chains with exclusive designer merchandise and excellent customer service
Nordstrom, Neiman Marcus, Saks
Second Tier: Retailers sell more modestly priced merchandise with less customer service
Macy’s
Third Tier: Value oriented caters to more price conscious customer
JCPenney, Sears, Kohl’s
2-29
Department Stores:What To Do With an Eroding Market
To deal with an eroding market
Department stores are:
attempting to increase the amount of exclusive merchandise they sell
undertaking marketing campaigns to develop strong images for their stores and brands
building better relationships with their key customers
2-30
Issues in Discount Store Retailing
■ Only Big Left
Wal-Mart, Target
■ Wal-Mart’s Dominance
■ Differentiate Strategy
Wal-Mart = Low Price and Good value
Target = More Fashionable Apparel
■ Competition from Category Specialists
Toys-R-Us, Circuit City, Sports Authority
Issues in Discount Store Retailing
2-31
Issues in Specialty Store Retailing
Mall-Based Apparel Retailers
Decline in Mall Shopping and Apparel Sales-Lack of New Fashions
-Less Interest in Fashion
-Increased Price Consciousness
Lifestyle Formats –
Abercrombie and Fitch
Hot Topics
Issues in Specialty Store Retailing
2-32
Specialty Store Retailers
McGraw-Hill Companies, Inc./Andrew Resek, Photographer
2-33
Issues in Drug Store Retailing
Consolidation – Walgreens, CVS, Rite-Aid
Competition from Supermarkets, discount Stores and mail-in orders
Evolution to a New Format-Stand Alone Sites with Drive
Thru Windows-offering more frequent
purchase food items
Improved systems provide personalized service in the pharmacy
Issues in Drug Store Retailing
2-34
Category Specialists Deep and Narrow Assortments Destination Stores
Category killers
Low Price and Service
Wholesaling to Business Customers and Retailing to Consumers
Incredible Growth
Bass Pro Shops
Category Specialists
2-35
Category Specialists
Sephora,France’s leading perfume/cosmetic chainLVMH’s division
2-36
Category Specialists: Home Improvement Centers
Home Depot and Lowes act as both:
Retailer and Wholesaler
Consumer Business
2-37
Home Improvement Centers
Displayed in a warehouse atmosphere
Customer Service: How to select and how to use merchandise
Competition focuses on price, effort to differentiate and services provided
2-38
Issues in Extreme Value Retailing
Focuses on Lower Income Consumers
Names mostly imply good value not $1 price points
Low Cost Location
Limited Services
One of the Fastest Growing Retail Segments
Dollar Tree Family DollarDollar General 99 Cents Only Store
Issues in Extreme Value Retailing
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Any Questions??
2-40
Off-Price Retailers
Close-out retailers
Offer an inconsistent assortment of brand name merchandise at low pricesTJX companies (T.J. Maxx, Marshalls. HomeGoods)Ross Stores, Burlington Coat factory, Big Lots, Tuesday
Morning
2-41
Types of Non-store Retailers
2-42
Electronic Retailing
Many retailers operate from virtual storefronts on the World Wide Web, usually maintaining little or no inventory, ordering directly from vendors to fill customer orders
History of frenzied investments and false predictions of retail dominance
Primarily used by traditional retailers to compliment store and catalog offerings
Exclusive e-tailers target small and dispersed niche markets
2-43
What are Amazon and eBay?
http://www.Amazon.com – Merchandise to consumers. Provides website development and fulfillment services to other retailers
eBay – Acts as a mall or other shopping center providing a “place” for buyers and sellers to meet
Don Farrall/Getty Images
2-44
Issues in Catalog Retailing Low Start Up Cost
Evolution of Multi-Channel Offering
Hard to compete with large well established firms
Increasing Mail Costs
Clutter from other Catalogs
Specialty Catalogs like Victoria Secret
General merchandise catalogs like JC Penney
Issues in Catalog Retailing
2-45
Issues in Direct Selling
Completely bypasses retailers and wholesalers Manufacturers set up their own channels to sell their
products directly to consumers
Party plan system: merchandise is demonstrated in a party atmosphere
Multi-level network: Master distributors sell to distributors who sell merchandise
Pyramid schemes: Firm sells to other distributors and little if any merchandise goes to end users
2-46
Issues in Television Home Shopping Consumers watch cable stations, infomercials or direct response ads
Few consumers watch regularly
Most purchases made by small proportion of viewers
Customers can’t examine merchandise
Customers must wait for merchandise to come on
Sells predominately jewelry, apparel, cosmetics, kitchenware, and exercise equipment
2-47
Issues in Vending Machine Retailing
Automatic Merchandising About $25 billion worth of convenience goods are sold to
Americans through 4.7 million vending machines
Sales growth has been declining due to higher prices and healthier eating habits
New technology may help sales growth
Trend of placing machines in captive consumer locations
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Any Questions??
2-49
Services vs. Merchandise Retailers
■ Intangibility Problems in Evaluating Service Quality Performance of Service Provider
■ Simultaneous Production and Delivery Importance of Service Provider
■ Perishability No Inventory, Must Fill Capacity
■ Inconsistency of the Offering Importance of HR Management
Services vs. Merchandise Retailers
Characteristics of Service Retailing
Intangibility
•No patent protection possible•Difficult to display/communicate service benefits
•Service prices difficult to set•Quality judgment is subjective
•Some services involve performances/experiences
Characteristics of Service Retailing
Inseparability
•Consumer may be involved in service production•Centralized mass production difficult
•Consumer loyalty may rest with employees
Characteristics of Service Retailing
Perishability
•Services cannot be inventoried•Effects of seasonality can be severe
•Planning employee schedules can be complex
Characteristics of Service Retailing
Variability
•Standardization and quality control hard to achieve•Services may be delivered in locations
beyond control of management•Customers may perceive variability even when it does not actually occur
2-54
Type of Service Service Retail Firms
Airlines American, Delta, British Airways, Singapore Airways
Automobile maint/repair Jiffy Lube, Midas, AAMCO
Automobile rental Hertz, Avis, Budget, Alamo
Banks Citibank, NCNB, Bank of America
Child care centers Kindercare, Gymboree
Credit cards American Express, VISA, Mastercard
Education University of Florida, Babson College
Entertainment parks Disney, Universal Studios, Six Flags
Express package delivery Federal Express, UPS, US Postal Service
Financial services Merrill Lynch, Dean Witter
Fitness Jazzercise, Bally’s, Gold’s Gym
Health Care Humana, HCA
Home maintenance Chemlawn, MiniMaid, Roto-Rooter
Examples of Service Retailers
2-55
Examples of Service Retailers
Type of Service Service Retail Firms
Hotels and motels Hyatt, Sheraton, Marriott, Days Inn
Income tax preparation H & R Block
Insurance Allstate, State Farm
Internet access/Elec info. American On-Line, CompuServe
Movie theaters AMC, Loews/Sony, Universal
Real estate Century 21, Coldwell Banker
Restaurants TGI Friday’s, Wendy’s, Pizza Hut
Truck rentals U-Haul, Ryder
Weight loss Weight Watchers, Jenny Craig
Video rental Blockbuster, Hollywood Video
Vision centers Lenscrafter, Pearle
Consumer Perceptions of Service Retailing
Lessons in Service Retailing
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Any Questions??
2-59
Merchandise/Service Continuum
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Any Questions??
2-61
Types of Retail Ownership
Independent, Single Store Establishments Wholesale-sponsored
voluntary group
Corporate Retail Chains
Franchises
2-62
Retailers Using Franchise Business Model
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Any Questions??
Unit 3Assignments
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Any Questions??
Wrap Up
Discussion: Remember 1 Answer AND at least 2 Peer to Peer Comments per Question. Answer ALL Questions. Post on Three (3) separate days – First post by Saturday.
Remember you have assignments due this week. Due on Tuesday by 11:59 PM E.T. Late? Let me know
BEFORE!
Pending Assignments? Get them to me ASAP – contact me for instructions on
how to make them up or follow my instructions if I already contacted your.
Last day for Unit 1 assignments- Tuesday of Unit 3
Contact
you can contact me
through my email: [email protected] ,
through AOL Instant Messaging
my AOL IM name is nknardi,
(put me on your buddy list)
Office Hours or through the “Instructor’s Office” link under the
Course Home page
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Any Questions??
Thanks
Thank you for Attending!!!!
See you in the Discussion Thread Questions and in Next Week’s Seminar
Next Week – Unit 4Multi-Channel
Retailing