Mark Arben Delos Santos MM-3C RETAIL MANAGEMENT

ACTIVITY 4.

I. Identification

1. Service retailers
2. Off-price retailers
3. Extreme value retailers
4. Drug store
5. Department store
6. Full line discount store
7. Category specialist
8. Specialty store
9. Increase private-label merchandise
10. Increase exclusive merchandise

II. Enumeration

1. INTAGIBILITY
2. SIMULTANEOUS PRODUCTION AND CONSUMPTION
3. PERSHABILITY
4. INCONSISTENCY OF THE OFFERING TO CUSTOMERS

III. Essay

Both service and merchandising companies may experience gain or

losses from non-operational source. However source of the gains or losses
differ between the two business types. For a instance a merchandiser might
decided to redecorate a retail store and sell of fixtures for a profit. A service
company might have a one time gain from sale of a patient. Lawsuits may
also be a a factor for both types of businesses. For merchandisers lawsuits
are often related to defective goods. Mean while a service provider might be
more likely sued for a breach of contact.
Both merchandising companies and service companies prepare income
statement to help investors analyst and regulators understand their internal
financial operations. Merchandising companies hold and account for
productive inventory which their income statements inherently more
complicated. Much of the inventory calculation is manifested through the line
item cost of goods sold which is an expenses account describing the cost of
purchasing inventory and delivering it to customers. If you look an income
statement for a service company you will not see a line item for the cost of
goods sold
The nature of increases or decreases in net revenue for each type of
company is also different. Service companies do not typically enormous
expense accounts meaning that fluctuations in net revenue are almost entirely
a function of generating sales. Manufacturing companies are less certain
since a decrease in net revenue could be an increase in expenses or a
decrease in revenues.