Theories In Retailing

Topics: Retailing, Product, Shopping mall Pages: 9 (232 words) Published: January 16, 2015
THEORIES OF
RETAIL
DEVELOPMENT
By
RITA PRUSTY
IBCS

THE PROCESS OF RETAIL
DEVELOPMENT REVOLVE AROUND
THE IMPORTANCE OF:





Competitive pressures
Investments in organisational
capabilities
Creation of sustainable competitive
advantage

THEORIES ARE:
1.
2.
3.

Environmental Theory
Cyclical Theory
Conflictual Theory

ENVIRONMENTAL
THEORY:
Change in retail is attributed to the
change in the environment in which
the retailer operate.
 The various influences of the external
environment are:
1. Technological
2. Economical
3. Demographic
4.
Legal & Political
5. Socio- Cultural


CYCLICAL THEORY:


Where change follows a pattern and
phases can have definite identifiable
attributes associated with them.

THE WHEEL OF RETAILING:

Mature RetailerTop heavy
Vulnerability Phase
Conservative
Declining ROI

Innovative RetailerEntry Phase
Low status and Price
Minimum service
Poor facilities
Limited product offering

Traditional RetailerElaborate facilities
Higher rent
More locations
Higher prices
Extended product offerings
Trading Up Phase

RETAIL ACCORDION
THEORY



Retailers enter a market as general
retailer, with experience they focus
down on particular product sectors.
Over time they begin to diversify their
offering in order to grow but again will
revert to specialisation.

LIFE CYCLE IN RETAIL:
1.
2.
3.
4.

Innovation -10 yrs (African markets)
Accelerated Growth -15-25 yrs
(Indian Markets)
Maturity- 5-10 yrs (South Asian
markets)
Stagnation – 5-10 yrs (Developed
markets)

CONFLICT THEORY:
The developments in retailing are as
follows1.
Thesis- Individual retailers as corner
shops all across the country
2.
Antithesis- A position opposed to the
thesis develops over a period of time
3.
Synthesis- A blending of the thesis
and antithesis

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