Merchandise Offering

● Variety (breadth of merchandise)

- The number of merchandise categories

Assortment (depth of merchandise)

-the number of items in a category (SKUs)

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Shopping Patterns by Types of Retail Outlets

Outlet % Shopping Number of Weekly

Weekly Trips Spending

Supermarkets 100 2.4 $ 72.82

General merchandise 68 1.3 32.53 discount
stores
Fast-food restaurants 65 1.9 16.32
Drug stores 39 1.2 18.70
Convenience stores 37 2.4 19.72
Wholesale clubs 27 1.7 75.12
Specialty food stores 9 1.0 23.70

Source: “Consumers Are Skeptical Again,” “63rd Annual Report of the Grocery Industry,” Progressive Grocer, April 1996, p.42.
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 Types of Retailers

Food Retailers General Merchandise Retailers

Mom and Pop Stores Department Stores

Convenience Stores Specialty Stores

Supermarkets Discount Stores

Supercenters Category Specialists

Off-Price Retailers
Warehouse Clubs

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 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

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 Non-store Retail Formats

Electronic Retailing

Catalog and Direct Mail

Direct Selling

Television Home Shopping

Vending Machines

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 Issues in Catalog Retailing

● Low Start Up Cost

● Evolution of Multi-Channel Offering
-Electronic Channel, Stores
● Increasing Mail Costs
● Clutter from other Catalogs

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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
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