COMMERCE 2MA3 Lecture Notes - Lecture 11: Ikea, Hypermarket, Walmart
24 Apr 2016
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Document Summary
Retailing: activities involved in selling merchandise to ultimate consumers. Wheel of retailing: hypothesis that each new type of retailer gains a competitive foothold by offering lower prices than current suppliers charge; the result of reducing or eliminating services. The wheel of retailing attempts to explain the patterns of change in retailing. When selecting a target market factors to consider are the size and profit potential of the market as well as the level of competition for its business. A retailer must decide on general merchandise categories, product lines, specific items within lines, and the depth and width of its assortments. Slotting allowances: nonrefundable fees grocery retailers receive from manufacturers to secure shelf space for new products. Markup: amount a retailer adds to the cost of a product to determine its selling price. Influence by two factors: (1) services performed by the retailer and (2) inventory turnover rate.
