A clear target market allows retailers to better understand customer needs and competitors. Targeting improves knowledge of customer characteristics, main competitors, and changing consumer demands. Retailers can be classified by ownership structure as independent retailers, chains, franchises, leased departments, or cooperatives. Retail formats include convenience stores, supermarkets, hypermarkets, specialty stores, department stores, and off-price retailers. Non-store retailing includes direct marketing, mail order, telemarketing, and automated vending. Developing a retail strategy involves establishing missions and objectives, analyzing the situation, identifying options, allocating resources, and monitoring progress.

2. Target markets A clear specification of the target market allows for a number of benefits, including improved levels of understanding of: The characteristics and needs of the group targeted The main competitors The changing needs of targeted consumers

4. Benefits of targeting A fuller understanding of the unique characteristics and needs of the group to be satisfied is reached. A better understanding of the main competitors is gained because it is possible to detect those retail companies who have made a similar selection of target marks. Improvements are possible in the understanding of the changes and development in the needs of the target market.

5. Store based retailing: Form of ownership Merchandise offered

6. Classification on the basis of ownership Independent retailer Chain retailer Franchise Leased departments Consumer co-operatives

7. Independent retailer An independent retailer is one who owns and operates only one retail outlet. Examples of independent retailer: Kirana store and paanwala. Chain retailer When two or more outlets are under a common ownership, it is called a retail chain. Examples: wills sports( ITC), Louis Philippe

8. Franchising A franchise is a contractual agreement between the franchiser and the franchisee. Franchising may be of the following types: A product or trade mark franchise. A business format franchise. Leased departments These are also termed as shop in shops. When a section of a department in a retail store is leased/ rented to an outside party, it is termed as a leased department. Consumer co-operatives The presence of consumer cooperatives has been working as a force of market for the common man

9. Classification on the basis of the merchandise offered Convenience stores Super markets Hyper markets Specialty stores Departmental stores Off price retailer

10. Convenience stores These are relatively small stores located near residential areas, they are open for long hours, seven days a week and offer a limited line of convenience products like eggs, bread, milk , etc. SupermarketsThese are large, low cost, low margin, high volume service operation, designed to meet the needs for food, groceries and other non-food items. Hyper markets A store that satisfies the following characteristics has been defined by the IGD as a hypermarket: A selling area between 5,000 sq m A wide range of products including food and non-food items Discounted prices A destination offer

11. Specialty stores A store specializing in a particular type of merchandise or a single product of durable goods or a range of normally complementary durable goods product categories is termed as a specialty store. Department stores Department store are defined as those establishments depending on food, clothing and home related items for at least 10% but less than 70%, respectively of their sales . Further more, these stores have at least 50 employees and a self-service ratio of less than 50%. Off price retailers The merchandise is sold at less than retailer prices. Off-price retailers buy manufacturers seconds, overruns or off seasons at a deep discount

13. Tele marketing

16. Car rentals

17. Services Providers of various servicesRetail Banking It refers to the dealing of commercial banks with individual customers. It products would include fixed, current savings account on the liabilities side; and mortgages and loans on the assets side.

18. Cyclical theory The most well known theory of retail evolution is the wheel of retailing Theory. This theory described by McNair, helps us understand retail changes. This theory suggests that retail innovators often first appear as low-price operators with a low cost structure and low profit-margin requirements, offering some real advantages, such as specific merchandise which enables them to take customers away from more established competitors. Cyclical theory

20. Growth strategy A retailer can enter a new marker by adopting any of the following methods Export Franchising Acquisitions and mergers Joint venture Organic growth

21. Export Exportis the selling of domestically manufactured products in a different country. A retailer who has a distinct product, such as an own brand, which may be attractive to customers in other markets may look at an exports as an option. Marks Spencer did this successfully with its St.michale’s brand, as did the body shop. If the response to the exported product is good in the market. It is a good indication that retail stores for that brand could also do well in that particular country.

22. Franchising This strategy of market development has seen the rapid expansion of many retail chains across the global. This strategy enables a retailer to build a strong identity in the market.

23. Acquisitions and Mergers Acquisitionthe word suggests , implies an organization acquiring Another organization. Example : Wal-Mart Mergers on the other hand, imply two organizations coming together to form a combined entry. The merger retail giant Carrefour and promodes in Europe is an example of the same

24. Joint venture A joint venture is a strategic partnership between a local retailer and an international player. This arrangement allows the international retailer to learn from the expertise of the domestic partner, while the domestic retailer can learn from the international practices of the partner

25. Organic growth Organic growth is replicating the retail format in the non-domestic market , With in the regulatory framework of the new market. A rapid roll out helps the retailer by offering the following advantages Building economies of scale Creating entry barriers Capturing possibly scarce resources in terms of location, manpower, etc. Building brands

26. The concept of the business model There are mainly nine building blocks to help us describe business models The target customer segments addressed by the retailer. The value proposition of what is offered to the market. The communication and distribution channels to reach customers and offers the value proposition. The relationships established with customers. The configuration of activities performed/required to implement the business model. The core competencies need to make the business model possible. The revenue streams generated by the business model constituting the revenue model. The cost structure resulting for the business model. The partners and their motivations of coming together to make a business model happen

27. Steps involved in developing a retail strategy Establishing mission Analyse situation Identify options Set objectives Obtain & allocate resources Develop implementation plan Monitor progress & control Feed back

28. Develop the strategic plan In order to be successful in segmenting the markets, the retailer must ensure that it is: Measurable – is the segment measurable and identifiable….?? Accessible – will focusing marketing efforts on a particular market segment have a positive impact on electing the desired responses…?? Economically viable – is the segmentation variable shared by enough potential customers to justify the expense and effort of focusing marketing efforts on that segments….?? Stable – are the consumer characteristics stable indicators of the market potential…..??

29. Factors to be considered for retail planning The following golden rule advice given to all would be retail entrepreneurs by Paul b brown and Geoffrey n smith A void business that are in danger of over saturation. Originality isn’t always necessary. In fact further improving on well-established retail type of business is often the way to go. Concentrate your research on filling a need in retailing. Always start a business cautiously and with adequate capital. Don’t except to get rich overnight.

30. The following specific parameters must be considered at length Evaluating financial capabilities Finalizing of store format Market research Competition analysis Advantage accruing chain store retailers

31. Evaluating financial capabilities Retail planning process is to evaluate the finances available to the individual both from his own internal sources as well as from borrowed ones. This will enable the entrepreneur to shortlist the suitable store format option that may be possible rather than waste time in considering hundreds of retail options .

32. Evaluating financial capabilities Retail planning process is to evaluate the finances available to the individual both from his own internal sources as well as from borrowed ones. This will enable the entrepreneur to shortlist the suitable store format option that may be possible rather than waste time in considering hundreds of retail options .

33. Finalisation of store format The following issues thus need to be considered before an appropriate store format can be selected from available options with a view to minimizing the risks A retailer entrepreneur must be personally interested in the product mix that he proposes to deal in. The retailer must possess adequate managerial capabilities to manage a large or small store with all the equipment, manpower and other responsibilities that it entails. The abundant availability of the products from their numerous sources should be ensured so that the supply is not affected even if the demand increases substantially

35. Language

37. Competition analysis The most critical aspect of the situation pertains to the retailers ability to determine his unique capabilities as against those of his competitors. Only with a through understanding of his own unique capabilities can help a retailer to invest in opportunities that exploit his strengths and to avoid those that emphasize his weakness.

39. Cheaper buying prices

40. Every day lower

41. Lower project costs

42. Franchising adds to profits

44. Lower project costs A large number of stores would also mean huge outgoings towards the costs of retail and allied equipment. Franchising adds to profits Franchising is known to be the fastest mode of growth for most business. Deciding on own/franchise store After one has shortlisted the store format and analysed all other issues discussed, it is imperative to decided whether one wishes to go it alone or to opt for the relatively safer method of franchising.