The document discusses the evolution of the retail buying process from traditional to modern. Traditionally, retail buying was viewed as a subset of industrial buying behavior, which focused on making coherent decisions between products and suppliers. However, the modern retail buying process is more complicated and diverse, requiring involvement in activities across the value chain such as product development, market analysis, and brand management. Key influences that were omitted from traditional models include private brands, retail organization structure, use of information technology, and incorporating customer experience. The modern process encompasses tasks of product management beyond just buying, including pricing, promotion, and inventory management. Category management and quick response strategies are now data-driven approaches used in the retail buying process.

1. Retail Buying Process
Lecturer one
Gathered: Fariba Mainji
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2. INTRODUCTION
 The retail buying process, and those involved, play an important role
in the value chain as they ultimately determine which products and
brands are made available to the consumer.
 Retail buying process is also increasingly involved in generating
revenue from products purchases.
 The “modern” retail buyer is now involved in activities previously
undertaken by the commercial, operational and sales functions such
as product development, market analysis, sales forecasting and
range, assortment, and brand management.
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3. TRADITIONAL VIEW OF RETAIL BUYING
 Retail buying has historically been treated as a sub-set of
organizational or industrial buying behavior (IBB) by academics.
 Sheth (1981) with his “theory of merchandise buying behaviour” is
regarded as having produced the first conceptual model of retail
buying.
 Industrial buying behavior is the theory that retailers used separate
choice standards to make coherent decisions.
 IBB is the improving the choices between different products and
suppliers in order to meet the merchandise requirements of the
retailer.
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4. KEY INFLUENCES OMITTED FROM THE
TRADITIONAL MODELS
The emergence of private brands;
The structure of retail organizations;
 The use of information and information technology;
 The changing role of retailing in the channel;
The incorporation of a wider range of service and
experience elements in retail strategies.
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5. MODERN RETAIL BUYING
 Retail buying today is inherently more complicated and diverse than
the traditional IBB models would suggest.
 Requires involvement in a range of activities and tasks earlier observed
as the domain of the commercial parts of the retail operation.
 The buying process, as such, has in essence become a process of
product management – encompassing buying but also aspects of selling
the product.
 This requires consideration of functions, tasks and activities associated
with merchandise management, sales activities including pricing and
promotion, inventory management and sales forecasting and
monitoring.
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6. RETAILING AND TECHNOLOGY
 As retailing has become more market oriented in its approach, with
a move towards a demand (pull) chain rather than a supply (push)
chain ethos, the implications for retail buying have been generally
overlooked.
 The emergence of a consumer driven approach to retailing has been
greatly facilitated by advances in information technology, and
approaches and tools such as Electronic Data Interchange (EDI),
Efficient Consumer Response (ECR),
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7. CHANGES IN RETAIL BUYING BAHVIOR
FROM TRADITIONAL TO MODERN
There have been significant changes in the scope,
organization and implementation of retail buying.
The tasks/activities carried out;
The composition and behavior of the buying (decision
making) unit;
 The organization and management of retail activities.
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8. CATEGORY MANAGEMENT
 Category management is data intensive and analytical in character.
Category management is about understanding data. By contrast, shopper
marketing is more about understanding emotions or motivations.
 Category Management is a collaborative continuous process between
manufacturers and retailers to manage a shopper need state which we
refer to as a ‘category’.
 The purpose of this process is to optimize shopper satisfaction and
fulfill the role chosen by the retailer for that category within the overall
portfolio of categories in the retail format. The end state of the category
management process is that combination of assortment, price, shelf
presentation and promotion which optimizes the category role over
time.
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9. Quick Response (QR)
 Quick Response is the ultimate challenging way to success in fashion (clothing)
business and is widely accepted and implemented by retailers of department store
type merchandise.
 Many retailers have found that they can serve customers better by implementing
QR without reducing profits.
 A QR strategy is reported to result in efficiencies, such as quicker deliveries,
faster inventory turns, fewer stock-outs, fewer markdowns and lower inventory
investment.
 QR strategy reduces the time between the sale and replacement of goods on the
retailer’s shelf and it is possible to maintain retail inventories at levels to meet
consumers’ demands more often than without QR.
 Most companies that have implemented QR have got positive impacts on their
financial and operating data by increasing profits and/or imparting better pricing
to consumers. The introduction and implementation of QR are gradually
increasing.
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