What is Retailing?
Retailing- the set of business activities that adds value to the products and services sold to
consumers for personal or family use.
The Retailer's Role in a Supply Chain
Retailer- business that sells products and/or services to consumers for their personal or family
use and links manufacturers to consumers Supply chain- set of firms that make and deliver goods and services to consumers manufacturing wholesaler retailer consumer
Vertical integration- a firm performs more than one set of activities in the channel, as occurs
when a retailer engages in wholesaling activities by operating its own distribution centers
to supply its stores Backward integration- retailer performs some wholesaling and manufacturing activities, such
as operating warehouses or designing private label merchandise Forward integration- manufacturer undertakes retailing and wholesaling activities Retailers Create Value
1. Providing Assortments- allows consumers to choose from many different options 2. Breaking bulk- enables manufacturers to efficiently make and ship merchandise in larger
quantities and enables consumers to purchase merchandise in smaller, more useful
quantities 3. Holding inventory- products will be available when consumers want them 4. Providing services- make it easier for customers to buy and use products
Social and Economic Significance of Retailing
Corporate social responsibility (CSR)- involves and organization voluntarily taking
responsibility for the impacts of its activities on its employees, its customers, the
community, and the environment.
1. activities required by law
2. provide short-term financial benefit for the company
3. operate in what they believe is the "right thing" to do
4. engage in socially and environmentally for the "well being" of everyone Retail Sales
in 2007 $4.5 trillion in retail sales
about 8.1% of total GDP comes from retail sales
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