Retailing is the sale of goods or commodities in
small quantities directly to consumers. Also known as to sell at retail. For
example: We began our retailing business by selling a locally made product to
In commerce, a retailer buys goods or products in large
quantities from manufacturers or importers, either directly or through a
wholesaler, and then sells individual items or small quantities to the general
public or end user customers, usually in a shop, also called store. Retailers
are at the end of the supply chain. Marketers see retailing as part of their
overall distribution strategy.
Shops may be on residential streets, or in shopping streets with little or no
houses, or in a shopping center or shopping mall. Shopping streets may or may
not be for pedestrians only. Sometimes a shopping street has a partial or full
roof to protect customers from precipitation.
Shopping is buying things, sometimes as a recreational activity. A cheap
version of the latter is window shopping (just looking, not buying).
Kinds of retailers
A large shop is called a superstore
or megastore. A shop with many different kinds of articles is called a
Many shops are part of a chain: a number of similar shops with the same name
selling the same products in different locations. The shops may be owned by one
company, or there may be a franchising company that has franchising agreements
with the shop owners (see also restaurant chain).
Some shops sell second-hand goods. Often the public can also sell goods to
such shops. In other cases, especially in the case of a nonprofit shop, the
public donates goods to the shop to be sold (see also thrift store). In
give-away shops goods can be taken for free.
The term retailer is also applied where a service provider services the needs
of a large number of individuals, such as with telephone or electric power.
The pricing technique used by most retailers is
cost-plus pricing. This involves adding a markup amount (or percentage) to the
retailers cost. Another common technique is manufacturers suggested list
pricing. This simply involves charging the amount suggested by the manufacturer
and usually printed on the product by the manufacturer.
In Western countries, retail prices are often so-called psychological
prices or odd prices: a little less than a round number, e.g. US$6.95. In Chinese
societies, prices are generally either a round number or sometimes some lucky
number. This creates price points.
Often prices are fixed and displayed on signs or labels. Alternatively,
there can be price discrimination for a variety of reasons. The retailer
charges higher prices to some customers and lower prices to others. For example,
a customer may have to pay more if the seller determines that he or she is
willing to. The retailer may conclude this due to the customer's wealth,
carelessness, lack of knowledge, or eagerness to buy. Price discrimination can lead to
a bargaining situation often called haggling -- an argument about the price.
Economists see this as determining how the transaction's total surplus will be
divided into consumer and producer surplus. Neither party has a clear advantage,
because the threat of no sale exists, whence the surplus vanishes for both.
This article uses materials from www.about.com, and the Wikipedia, the free
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