HOW RETAIL TRADE CAN BE A REWARDING ENTERPRISE FOR SMALL BUSINESS OWNERS
Retailers are business firms engaged in offering goods and services directly to consumers. In most– but not all – cases, retail outlets are primarily concerned with selling, merchandise. Typically, such businesses sell individual units or small groupings of products to large numbers of customers. A minority of retailers, however, also garner income through rentals rather than outright sales of goods (as in the case of enterprises that offer furniture or gardening tools for rent) or through a combination of products and services (as in the case of a clothing store that might offer free alterations with the purchase of a suit).
Retail trade is widely known as a very competitive area of commercial endeavor, and observers note that many fledging retail establishments do not survive for more than a few years. Indeed, competition for sales has become so great that consumers have seen a marked blurring of product lines among retailers. Increasingly, retailers have taken to stocking a much greater variety of goods than their basic industry classification would indicate (bookstores, for example, increasingly stock music products, while food, liquor, office supplies, and other wares can all be found in contemporary drug stores). This development further complicates efforts to establish and maintain a healthy presence in the marketplace. But for the small business owner who launches a retail store on an adequate foundation of capital, business acumen, and attractive merchandise, involvement in the trade can be rewarding on both financial and personal fulfillment levels.
Primary Retail Types
Retail enterprises can either be independently owned and operated or part of a “chain,” a group of two or more stores whose activities are determined and coordinated by a single management group. Stores that are part of a chain may all be owned by a single company, but in other cases, the individual stores may be franchises that are independently owned by a small businessperson.
Many different types of retail establishments exist, and, as noted before, the overall industry has seen a significant blurring of the boundaries that had long separated the wide range of companies operating under the retail umbrella. Nonetheless, retailing establishments still generally fall into one of the following general categories
Specialty Stores – These establishments generally concentrate their efforts on selling a single type or very limited range of merchandise. Clothing stores, musical instrument stores, sewing shops, and party supply stores all fall under this category.
Department Stores – These establishments are comprised of a series of departments, each of which specializes in selling a particular grouping of products. Under this compartmentalized arrangement, consumers go to one area of the store to purchase tableware and another area to acquire bedding, for example.
Supermarkets – These retail establishments, which are primarily involved in providing food to consumers but have increasingly ventured into other product areas in recent years, account for the vast majority of total food-store chains in most developed economies.
Discount Stores – These retail outlets offer consumers a trade-off: lower prices (typically on a broad range of products) in exchange for lower levels of service. Indeed, many discount stores operate under a basic “self-service” philosophy.
Mail-order Businesses and other Non-Store Retailing Establishments – Mail-order sales have become an increasingly ubiquitous part of the national retail landscape: indeed, some retail establishments subsist entirely on mail-order, forsaking traditional stores entirely, while other companies maintain operations on both levels. In addition, this category includes sales made to end consumers through telemarketing, vending machines, the World Wide Web, and other non-store avenues.
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