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Chapter 02 - Types of Retailers
Variety is often referred to as the breadth What benefits does high variety offer to
of merchandise and assortment is referred customers? What is the benefit of high
to as the depth of merchandise. assortment?
Ask student to give an example of an SKU.
B. Services Offered See PPT 2-9
Retailers also differ in the services they

offer customers. Customers expect Discuss the different customer service policies
2-2
Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-
Hill Education.
retailers to provide some services-- of a specialty store like Apple and a local
accepting personal checks, displaying department store or an Internet retailer.
merchandise, providing parking, and being
open long and convenient hours.
Discuss how customers’ expectations differ at
Some retailers charge customers for other each type of store.
services, such as home delivery and gift
wrapping, although upscale retailers offer
customers these services at no charge.
C. Prices and the Cost of Offering Breadth and See example in PPT 2-10 for illustration
Depth of Merchandise and Services
Stocking a deep and broad assortment is Customers like wide variety, deep assortments,
appealing to customers but costly for and a lot of service, though some customers
retailers. When a retailer offers many appreciate having the retailer edit the
SKUs, inventory investment increases assortment for them. Ask students why all
because the retailer must have back-up retailers don’t have this type of offering?
stock for each SKU.
Retailers have constraints of money , size of
Similarly, services attract customers to the
store, and limited number of employees.
retailer, but they are also costly.
To make a profit, retailers that offer Why don't discount stores offer more services?
broader and deeper assortments and (They appeal to a target segment that does not
services need to charge higher prices. want to pay the cost for more service options.)
A critical retail decision involves the trade-

off between costs and benefits of PPT 2-12 shows a comparison of sales and growth
maintaining additional inventory or rates in various retail sectors
providing additional services.
II. Food Retailers See PPT 2-13
Twenty years ago, consumers purchased

food primarily at conventional Where do students make the majority of their
supermarkets. Now conventional off-campus food purchases? What are the pros
supermarkets account for only 60 percent and cons of these different food retailer
of food sales. formats?
Supercenters, warehouse clubs,
convenience stores and extreme value food
retailers are significantly changing Ask students where they see the direction of food
consumers' food purchasing patterns retailers going in the next 20 years.
because they too sell food. At the same
time, traditional food retailers carry many
nonfood items.
The world's largest food retailer is Wal-
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Mart with supermarket-type sales of more

than $134 billion.
A. Supermarkets See PPT 2-14
A conventional supermarket is a self-

service food store offering groceries, meat, Ask students to consider the retail mixes of the
produce, and limited non-food items. major supermarkets in the area surrounding
campus. Which compete on price? On
A limited assortment supermarket (also merchandise? On service? A combination?
called an extreme value food retailer)
only stocks about 2,000 SKUs. The two
largest US examples of these stores are
Save-A-Lot and ALDI. Do students have concerns about the quality of
items at conventional supermarkets versus limited
Limited assortment supermarkets are assortment supermarkets?
designed to maximize efficiency and
reduce costs through limited assortment
and service offerings. These cost savings
and efficiencies allow the stores to charge
significantly lower (40-60% lower) prices
than conventional supermarkets.
1. Trends in Supermarket Retailing See PPT 2-17
Today, conventional supermarkets are

under substantial competitive pressure.
Supercenters are attracting customers with Ask students about why they would continue to
their broader assortments and general shop at conventional supermarkets. Alternatively,
merchandise at attractive prices. Full-line why would they shop for food at supercenters,
discount chains and extreme value retailers warehouse clubs or convenience stores? What
are increasing the amount of shelf space types of needs are fulfilled by conventional
they devote to consumables. supermarkets that can’t be filled through other
food retailing formats? Based on these
Competitive pressure also comes from discussions, will conventional supermarkets be
convenience stores who are selling more driven out of business by competing formats?
fresh merchandise.
Low cost competitors are especially

challenging for conventional supermarkets
because of their superior operating
efficiencies.
To compete successfully with intrusions by

other types of retailers, conventional
supermarkets have taken steps to
differentiate their offerings, such as
emphasizing their “power perimeters”
(areas around the outside walls with fresh
perishables such as dairy, produce, florist,
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deli and bakery departments), targeting

health conscious and ethnic consumers,
providing a better in-store experience, and
offering more private-label brands.
Conventional supermarkets are also

offering more natural, organic, and fair
trade foods for their increasingly health
and environmentally conscious consumers.
Fair trade means purchasing from
factories that pay workers a living wage,
well more than the prevailing minimum
wage, and offer other benefits like onsite
medical treatment.
Through adjustments to the traditional

merchandise mix, conventional
supermarkets are also targeting more
ethnic shoppers.
Conventional supermarkets chains are

leveraging their quality reputations to offer
more private-label merchandise. Private-
label brands benefit both customers and
retailers.
The online grocery market also represents

a growing category.
Creating an enjoyable shopping experience

through wider variety, better store
ambiance, and customer service is another
approach supermarket chains may use to
differentiate themselves from low-cost,
low-service competitors. Some have begun
to integrate “food as theater” concepts,
such as cooking and nutrition classes and
food tastings.
B. Supercenters See PPT 2-18 for an illustration of the

characteristics of supercenters and warehouse
Supercenters are the fastest growing retail clubs.
category. At 150,000 to 220,000 square
foot these stores offer a wide variety of
food and non-food merchandise. The
largest supercenters are Wal-Mart The supercenter is one of the fastest growing
supercenters, Meijer, Kmart, Fred Meyer retail formats. Why is the supercenter more
(a division of Kroger), and Target. attractive than a hypermarket in the U.S., but
not in Europe? What are benefits to consumers
By offering broad assortments of grocery shopping in supercenters versus conventional
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and general merchandise under one roof, supermarkets? What are the disadvantages?
supercenters provide a one-stop shopping
experience.
Ask students if they prefer the supercenter model to
General merchandise items are often
a traditional supermarket? How do students feel
purchased at supercenters. These items
about the growth of Walmart? Do students prefer
have higher margins, which allows
Walmart’s format over Target? Why?
supercenters to offer food items at a more
aggressive price.
However, since supercenters are very

large, some customers find them
inconvenient because it can take a long
time to find the items they want.
Hypermarkets are also large (100,000 to

300,000 square feet) combination food and
general merchandise retailers. They
typically stock fewer SKUs than
supercenters.
Popular in both Europe and South

America, hypermarkets are not common in
the United States. Located in large,
warehouse-type structures with large
parking facilities, hypermarkets typically
carry a larger selection of food items than
supercenters with a focus on perishables.
Supercenters place greater emphasis on

general merchandise and dry grocery items
such as breakfast cereals and canned
goods.
Although supercenters and hypermarkets

are the fastest growing categories in global
retailing today, these retailers do face
challenges in finding and acquiring
appropriate land for building (particularly
in Europe and Japan), along with backlash
against these supersize stores, particularly
in the U.S.
C. Warehouse Club See PPT 2-18 for an illustration of the

characteristics of supercenters and warehouse
A warehouse club is a retailer that offers a clubs.
limited and irregular assortment of food
and general merchandise with little service
at low prices to ultimate consumers and Ask students to give local examples of
warehouse clubs. What is the target market for
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small businesses. warehouse clubs? (Consumers with larger

families and small businesses.)
Stores are large (at least 100,000 to
150,000 square feet) and located in low
rent districts.
Warehouse clubs reduce prices by using Are warehouse clubs wholesalers or retailers?
low-cost locations and inexpensive store (When they sell to small businesses they are
designs, and offering little customer wholesalers. When they sell to individual
service. They reduce inventory holding members for personal or household use, they
costs by carrying a limited assortment of are retailers.)
fast-selling items and buying merchandise
opportunistically.
Most warehouse clubs have two types of Ask students if they are members of a warehouse
members: wholesale members who own club? Do they prefer warehouse clubs to
small-businesses and individual members supercenters?
who purchase for their own use. Typically
members must pay an annual fee.
D. Convenience Stores See PPT 2-19 for an overview of the

characteristics of convenience stores
Convenience stores provide a limited
variety and assortment of merchandise at a
convenient location in a 3,000-to-5,000- Ask students to give examples of local
square-foot store with a speedy checkout, convenience stores.
with higher prices than supermarkets. They
are a modern version of the neighborhood
mom-and-pop grocery/general store. Which products do they tend to buy most often
at convenience stores?
Convenience stores enable consumers to
make purchases quickly without having to
search through a large store and wait in
What do they like/dislike about them? In
long checkout lines.
general, what is so "convenient" about
Convenience stores generally charge a convenience stores?
higher price than supermarkets for staple
items like milk, eggs, and bread?
What services do students believe would make a
Convenience stores are facing increasing convenience store more “convenient”?
competition from other retail formats,
especially from supercenters and
supermarket chains who have added
gasoline to their merchandise offerings,
offering tying gasoline sales to their
frequent shopper programs.
In response to these competitive threats,

convenience stores are taking steps to
decrease their dependency on gasoline
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sales by tailoring their merchandise

assortments to local markets, making their
stores even more convenient to shop, and
adding new services.
To increase convenience, some

convenience stores are opening smaller
stores close to where consumers shop and
work. Others are exploring the use of
technology to increase shopping
convenience such as self-service kiosks.
III. General Merchandise Retailers See PPT 2-20

PPT 2-20 compares the various types of general
The major types of general merchandise merchandise retailers along several
retailers are department stores, full-line characteristics.
discount stores, specialty stores, category
specialists, home improvement centers,
off-price retailers, and extreme value
retailers.
A. Department Stores See PPT 2-21, 2-22, 2-23

Ask students to give examples of local
Department stores are retailers that carry
department stores. Why do customers go to
a broad variety and deep assortment, offer
some customer services, and are organized department stores? What do they like/dislike
into separate departments for displaying about them?
merchandise.
The largest department store chains in the Ask students to give local examples of specialty
U.S. are Macy’s, Sears, JCPenney, and stores. What are the differences between specialty
Kohl’s, Nordstrom, Dillard’s and Saks stores, department stores, and discount stores?
Fifth Avenue. Where do students buy business suits, dresses,
jeans, computers, electronics? Why do they go to
Today, most department stores focus that type of store?
almost exclusively on soft goods. The
major departments are women’s, men’s,
and children’s clothing and accessories;
home furnishings; cosmetics; and Which department stores do students prefer?
kitchenware and small appliances. Which tier do they shop most often? Discuss
differences in these responses.
Each department within the store has a
specific selling space allocated to it as well
as salespeople to assist customers, often
resembling a collection of specialty shops.
Department store chains can be categorized

into three tiers: (1) upscale, high fashion
chains with exclusive designer
merchandise and excellent customer
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service (Neiman Marcus, Nordstrom); (2)

traditional chains with more moderately
priced merchandise and less customer
service (Macy’s and Dillard’s); and (2)
value-oriented chains catering to price-
conscious consumers (Kohl’s and
JCPenney).
Today many customers question the

benefits of shopping at department stores
due to: (1) lack of convenient locations, (2)
decreases in customer service and (3)
relatively high prices.
B. Full-Line Discount Stores See PPT 2-24
A full-line discount store is a retailer that Discuss the target markets of the three largest full-
offers a broad variety of merchandise, line discount store chains (Wal-Mart, Target and
limited service, and low prices. They offer Kmart). How will the category specialists (Toys R
both private and national brands. Us, Staples, and Home Depot) affect the retail
strategy of full-line discount store chains? What
The big three full-line discount store about Internet only retailers? Are discount stores
chains are Wal-Mart, Target and Kmart. going to succeed in the “clicks” environment?
A significant trend in this sector is Wal- In general, what are the factors that contribute to the
Mart’s conversion of discount stores to success of discount stores despite increasing
supercenters as a result of increased competition from other formats?
competition faced by the full-line discount
stores, as well as the significant operating
efficiencies realized by supercenters.
Target is becoming one of the most

successful retailers in terms of sales
growth and profitability, succeeding
because its stores offer fashionable
merchandise at low prices in a pleasant
shopping environment.
C. Category Specialist See PPT 2-25

Ask students to give local examples of category
A category specialist is a big box discount
store that offers a narrow variety but deep
specialists. How are they similar to specialty
assortment of merchandise. These retailers stores? Discuss the differences and similarities
predominantly use a self-service approach, with discount stores.
but they offer assistance to customers in
some areas of the store.
By offering a complete assortment in a

category at low prices, category specialists
can "kill" a category of merchandise for
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other retailers and thus are frequently

called category killers.
Ask students to describe an experience at a home
Because category specialists dominate a improvement center such as Home Depot or
category of merchandise, they can use their Lowe’s in terms of merchandise, atmosphere and
buying power to negotiate low prices, and salesperson service.
assured supply when items are scarce.
One of the largest and most successful

types of category specialist is the home
improvement center. A home
improvement center is a category
specialist offering equipment and material
used by do-it-yourselfers and contractors to
make home improvements.
While merchandise in home-improvement

centers is displayed in a warehouse
atmosphere, salespeople are available to
assist customers in selecting merchandise
and to tell them how to use it.
Competition between specialists in each

category is very intense (Staples vs. Office
Depot; Home Depot vs. Lowe’s) as firms
expand into the regions originally
dominated by another firm. Direct
competition focuses on price, resulting in
reduced profits because the competitors
have difficulty differentiating themselves
on other elements of the retail mix.
In response to this increasing competitive

intensity, the category killers continue to
concentrate on reducing costs by
increasing operating efficiency and
acquiring smaller chains to gain scale
economies, although some category killers,
like Home Depot and Lowe’s are
attempting to differentiate themselves with
service through licensed contractors.
D. Specialty Stores See PPT 2-26

Why do customers go to specialty stores?
A specialty store concentrates on a limited
What do they like/dislike about them?
number of complementary merchandise
categories and provides a high level of
service in a relatively small store.
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Manufacturers are also opening their own

specialty stores (Levi’s, Godiva, Cole Haan,
Coach, etc). What are the implications for other
Specialty stores tailor their retail strategy
retailers like department stores who also sell these
toward very specific market segments by
brands?
offering deep but narrow assortments and
sales associate expertise.
Discuss the “fast fashion” specialty store model
with students. Which of these stores have they
Today, competitors from other countries
visited? What do they like/dislike about the
also are making some of the most
concept?
successful specialty stores in the U.S.
rethink how they satisfy their customers’
needs. For instance, Zara and H&M have
introduced “fast fashion” to the U.S.
market. Fast fashion is cheap and chic
offering new, fresh merchandise 2-3 times
per week.
E. Drugstores See PPT 2-27

Ask students if they have shopped online for
Drugstores are specialty stores that drugstore products. What has been their
concentrate on health and personal experience? Do they think the Internet is a viable
grooming merchandise. Pharmaceuticals channel for drugstore merchandise?
often represent 50 percent of drugstore
sales and an even greater percentage of
their profits.
Drug stores, particularly the national

chains, are experiencing sustained sales
growth because the aging population
requires more prescription drugs.
Prescription pharmaceutical margins are
shrinking due to governmental health care
policies and HMOs.
Drugstores are also being squeezed by

competition from pharmacies in discount
stores and supermarkets, as well as
prescription mail-order retailers.
In response, drug store chains are building

larger stand-alone stores offering a wider
assortment of merchandise, more
frequently purchased food items, and
drive-through windows for picking up
prescriptions. Also, drugstore retailers are
encouraging pharmacists to take the time to
provide personalized service.
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F. Extreme Value Retailers See PPT 2-28 for a summary of issues facing
extreme value retailers.
Extreme value retailers, such as Family
Dollar Stores and Dollar General, are
Ask students to name the extreme value
small, full-line discount stores that offer a retailers in the local marketplace. How many
limited merchandise assortment at very have shopped at one of them? For what types
low prices. of merchandise? What is the primary appeal of
these retailers?
By offering limited assortments and
operating in low-rent locations, extreme
value retailers are able to reduce costs and
maintain very low prices.
Despite some of these chains’ names, few

just sell merchandise for $1. Rather, the
names imply a good value but do not limit
prices to the arbitrary dollar price point.
The growing popularity of extreme value

retailers has led some vendors to agree to
create special, smaller packages just for
them.
Once considered low-status retailers

catering to low-income consumers,
extreme value retailers have broadened
their appeal to higher-income consumers
by offering exciting bargains and unique
merchandise.
G. Off-Price Retailers Ask students to give examples of local off-price

retailers. What do consumers like about off-
* Off-price retailers, also known as close- price retailers? What don't they like?
out retailers, offer an inconsistent
assortment of brand name merchandise at
low prices.
* Off price retailers can sell brand name and See PPT 2-29 for a summary of the issues
even designer-label merchandise at low facing off-price retailers
prices due to their unique buying and
merchandising practices. Most
merchandise is bought opportunistically
from manufacturers or other retailers with
excess inventory at the end of the season.
* End of season merchandise that will not be

used in following seasons is called close-
outs. The merchandise may be in odd sizes
or unpopular colors or styles, or it may be
irregulars, merchandise that has minor
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mistakes in construction.
* Typically, merchandise is purchased at

one-fifth to one-fourth of the original
wholesale price. Off-price retailers can
buy at low prices because they don't ask
suppliers for advertising allowances, return
Ask students which type of off-price retailer
privileges, markdown adjustments, or
delayed payments. offers consumers truly the best value? Why?
* Due to this pattern of opportunistic buying,

customers can't be confident that the same
type of merchandise will be in stock each
time they visit the store.
* Outlet stores are off-price retailers owned

by manufacturers, or by department or
specialty store chains.
* Outlet stores owned by manufacturers are

frequently referred to as factory outlets.
* Manufacturers view outlet stores as an

opportunity to improve their revenues from
irregulars, production overruns, and
merchandise returned by retailers. Outlet
stores also allow manufacturers some
control over where their branded
merchandise is sold at discount prices.
IV Differences between Services and

Merchandise Retailers PPT 2-30
* Four important differences in the nature of
the offering provided by services and
merchandise retailers are: (1) intangibility,
(2) simultaneous production and
consumption, (3) perishability, and (4)
inconsistency of the offering to customers.
1. Intangibility
Ask students how customers can evaluate the
* Services are generally intangible --
customers cannot see, touch, or feel them. quality of an intangible service offering. What
Services are performances or actions rather problems does intangibility cause for the
than objects. services retailer?
* Intangibility introduces a number of

challenges for services retailers. It is
difficult for customers to evaluate services
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before they buy them, or even after they

buy and consume them. Services retailers
often use tangible symbols to inform
customers about the quality of their
services.
* Services retailers also have difficulty in

evaluating the quality of services they are
providing. To evaluate the quality of their
offering, services retailers place emphasis
on soliciting customer evaluations and
complaints.
2. Simultaneous Production and

Consumption What problems does simultaneous production
* Service providers create and deliver the cause for the services retailer?
service as the customer is consuming it.
The simultaneity of production and
consumption creates some special
problems for services retailers.
* First, the customers are present when the

service is produced, may have an
opportunity to see it produced, and in some
cases, may be part of the production
process.
* Other customers consuming the service at

the same time can affect the quality of the
service provided.
* Finally, the services retailer often does not

get a second chance to satisfy the needs of
their customers. While customers can
return damaged merchandise to a store,
customers that are dissatisfied with
services have limited recourse. Thus it is
critical for services retailers to get it right
the first time.
* Because services are produced and

consumed at the same time, it is difficult to
reduce costs through mass production.
3. Perishability
* Because the creation and consumption of

Give examples of retailers for which
services is inseparable, services are perishability is a real problem? [movie
perishable. They can't be saved, stored, or theaters, airlines, cruise lines, public golf
courses] What do these retailers do to
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Hill Education.
resold. This is in contrast to merchandise, minimize the problem?

which can be held in inventory until a
customer is ready to buy it.
* In addition, the demand for a service varies What actions have students seen services retailer
considerably over time. Thus, services take to make waiting time more enjoyable for
retailers often have times when their customers?
services are underutilized and other times
when they have to turn customers away
because they cannot accommodate them.
* Services retailers use a variety of programs

to match demand and supply. They also
attempt to make customer waiting time
more enjoyable.
4. Inconsistency What problems does inconsistency cause for

the services retailer? Are there services
* Merchandise is often produced by retailers whose inconsistency is acceptable?
machines with very tight quality control. (Custom designers, hair “artists”)
Because services are performed by people,
no two services will be identical.
* Thus, an important challenge for service

retailers is providing consistently high-
quality services.
V. Types of Ownership See PPT 2-34
* Another way to classify retailers is by their

ownership. The major classifications of .
retail ownership are: (1) independent,
single-store establishments, (2) corporate
chains, and (3) franchises.
A. Independent, Single-Store Ask students to give examples of local

Establishments independent, single-store retailers. Do they
shop at independents? Why or why not?
* Retailing is one of the few sectors in our
economy in which entrepreneurial activity
is extensive. Many of these retail start-ups Do students believe national chains will drive
are owner managed which means all independents out of business?
management has direct contact with their
customers and can respond quickly to
those customers’ needs.
* While single-store retailers can tailor their

offering to their customers' needs,
corporate chains can more effectively
negotiate lower prices for merchandise and
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advertising due to their larger size.
* To better compete against corporate

chains, some independent retailers join a
wholesale-sponsored voluntary chain. A
wholesale-sponsored voluntary
cooperative group is an organization
operated by a wholesaler offering a
merchandising program to small,
independent retailers on a voluntary basis.
B. Corporate Retail Chains Wal-Mart has pursued a strategy of opening

stores on the outskirts of small rural towns
* A retail chain is a company operating with populations between 25,000 and 50,000.
multiple retail units under common These stores offer broader selection of
ownership and usually having some merchandise at much lower prices than
centralization of decision making in previously available from local retailers.
defining and implementing its strategy.
Discuss the pros and cons of this strategy in
class. What ramifications may result?
(Monopolizing market, demise of small stores,
potential to become major employer in rural
area).
C. Franchising Ask students to give examples of local
franchises. If they wanted to own a retail
* Franchising is a contractual agreement business, would they want a franchise or their
between a franchisor and a franchisee that own store? Why? What are the advantages of
allows the franchisee to operate a retail being a franchisee?
outlet using a name and format developed
and supported by the franchisor.
Approximately 40% of all US retail sales
are made by franchisees. PPT 2-35 provides a brief introduction to the
Franchising form of retail ownership.
* In a franchise contract, the franchisee pays
a lump sum plus a royalty on all sales for
the right to operate a store in a specific
location. The franchisee also agrees to
operate the outlet as per the procedures
prescribed by the franchisor. The
franchisor provides assistance in locating
and building the store, developing the
products and/or services sold, management
training, and advertising.
* The franchise ownership format attempts

to combine the advantages of owner-
managed businesses with efficiencies of
centralized decision-making in chain store
operations.
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VIII. Summary
Over the past 30 years, U.S. retail markets
have been characterized by the emergence of
many new retail institutions. Traditional
institutions have been joined by category
specialists, hypermarkets and superstores,
extreme value retailers, and nonstore
retailers among others.
IX. Appendix 2A: Comparison Shopping

For an exercise on comparison shopping see
* All retailers learn about their competitors Ancillary Exercise 2-2. Breaking the class into
through comparison shopping. It might be groups and having each group do a
as informal as walking through a comparison shopping exercise is a good way to
competitor's store and looking around.
get students to understand the difference
However, a structured analysis is more
helpful in developing a retail offering that
between retailers and the types of decisions
will attract consumers from a competitor's retail manager make. Have each group
store. compare different institutions selling the same
merchandise category. For example, men's
* The first step is to define the scope of the suits in a department store and men's specialty
comparison; the comparison might be store, athletic shoes in a discount store and
between two retail chains, two specific specialty shoe store, CD's in a discount store
stores, two departments, or two categories and a specialty music store.
of merchandise, depending on
responsibilities of the person undertaking
the comparison.
* Comparisons might also focus on chains'

financial resources, inventory levels,
number of stores and employees, store
locations, merchandise sold, employee
compensation programs, and return
policies.
ANS WE RS T O S E L E CTE D “GE T OUT AND DO IT S ”
2. GO SHOPPING Go to an athletic footwear specialty store such as Foot Locker, a sporting

goods category specialist, a department store, and a discount store. Analyze their variety and
assortment of athletic footwear by creating a table similar to that in Exhibit 2–2.
Students should be able to fill in this type of table and explain their findings.
Variety of Athletic Footwear Assortment of Athletic Footwear
Breath of Merchandise Depth of Merchandise
Footlocker
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Specialty Store
Sporting Goods Category
Specialist
Department store
Discount Store
3. GO SHOPPING Keep a diary of where you shop, what you buy, and how much you spend for
two weeks. How did each retailer meet your shopping needs? Get your parents to do the same
thing. Tabulate your results by type of retailer. Are your shopping habits significantly different or
are they similar to those of your parents? Do you and your parents’ shopping habits coincide with
the trends discussed in this chapter? Why or why not?
Students should keep a list of places shopped. Results can be compared to a parent or
another classmate. Thais assignment should give student insight to their own consumer
buying behavior and how they select merchandise and retail formats. Ask students to
discuss the managerial implications of their findings. How should retailers with differing
target markets communicate with the different audiences based on the differences in
buying behaviors, as discovered by this assignment.
4. GO SHOPPING Describe how the supermarket where you shop is implementing organic,
locally grown, ethnic and private label merchandise. If any of these categories of merchandise are
missing, explain how this could be a potential opportunity for growth for this supermarket. Then
describe any strategies or activities that you believe are providing any a better shopping
experience than its competition. If you believe that competing stores are providing a better
shopping experience than your store, explain what they are doing, and evaluate whether or not
these activities would benefit from your supermarket.
Responses here will vary. Some stores have big commitment to organic, locally grown,
ethnic and private label merchandise. Students should consider the demographics of the
store’s customers to evaluate the potential demand for these categories.
5. INTERNET EXERCISE Data on U.S. retail sales are available at the U.S. Bureau of the
Census Internet site at www.census.gov/retail. Look at the unadjusted monthly sales by NAICS
(found in the Monthly Retail Trade Report Section). Which categories of retailers have the
largest percentage of sales in November and December? Do your findings make sense to you?
Students will notice that many retail categories generate their largest percentage of sales in the
fourth quarter. Some are:
(443) Electronics and Appliance Stores
(44312) Computer and Software Stores
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(4453) Beer, Wine and Liquor Stores

(44812) Women’s Clothing Stores
(45111) Sporting Goods Stores
(454) Nonstore Retailers
The higher level of sales in the last quarter of the year are likely due to holiday sales. Do these
categories make sense to students? Are there other categories students would expect to see
similar sales?
6. INTERNET EXERCISE Three large associations of retailers are the National Retail
Federation (www.nrf.com), the Food Marketing Institute (www.fmi.org) and the National
Association of Convenience and Petroleum Stores (www.nacsonline.com). Visit these sites and
report on the latest retail developments and issues confronting the industry.
Information on these sites will change daily. The National Retail Federation will likely have
information on trends in retailing like showrooming and omnishopping. Similarly, the NRF will
also report on federal regulations, like taxes and swipe fees, that impact retailing. The Food
Marketing Institute will provide information on trends in food retailing and manufacturing as
well as legal and economic concerns. For example, the FMI may report on information about
changes in regulations on what constitutes organic The NACS will report on regulations as well,
such as debit card swipe fees, as well as information on oil prices and petroleum.
7. INTERNET EXERCISE Go to Entrepreneur Magazine’s Franchise Zone web page at

http://www.entrepreneur.com/franchise and view the top 500 franchises for the past year.
How many of these retailers in the Top Ten have you patronized as a customer? Did you know
that they were operated as a franchise? Look at the list for previous years to see changes in the
rankings. Click on the link, About the Franchise 500, and describe what factors were used to
develop the list. Finally, what is the nature of the business that seems to lend itself to
franchising?
The Top 10 Franchises for 2013 include many familiar names. Students will likely report having
visited a Subway, McDonald’s, or 7-Eleven. Students should uncover some notable changes in
the Top 10. Perhaps most significant, Subway has been moved into the number 2 spot after many
years at number 1. For 2013, Hampton Hotels is number 1. Why is Hampton Hotels rated higher
than Subway? An interesting point for discussion of competitive strategy is the reintroduction of
fast food retailers like McDonald’s and KFC to the top 10.. What do students believe are behind
the reinvigoration of these fast food franchise retailers? Will they be able to maintain these
positions in the face of changing trends in consumer lifestyles and food retailing?
The web site notes that the list of the Top 500 franchises is based on quantifiable measures such
as financial strength and stability, growth rate, size of the system, and number of years in
business. Students will likely notice that service-based retailers tend to lend themselves best to
the franchise system, particularly those services that allow for standardization of business
practices and retail operating formats.
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8 Bed Bath & Beyond is the number one superstore domestics retailer in the US with about 1,000
stores throughout the US and Ontario, Canada. This retailer sells domestics (bed linens,
bathroom and kitchen items) and home furnishings (cookware and cutlery, small household
appliances, picture frames, and organizing supplies). What are the SIC and NAICS codes used by
this retailer? What other retailers compete against Bed Bath & Beyond and which store format is
implemented by each competitor?
Primary SIC Code 5023: Home furnishings
Primary NAICS Code 442299: All Other Home Furnishings Stores

Other SIC Codes
2273 Carpets and rugs 35 Household vacuum cleaners
2391 Curtains and draperies 39 Household appliances, nec
2392 House furnishings, nec 61 Telephone and telegraph apparatus
2519 Household furniture, nec 21 Furniture
2844 Toilet preparations 41 Children's and infants' wear stores
3631 Household cooking equipment 19 Misc. home furnishings stores
3633 Household laundry equipment 22 Household appliance stores
3634 Electric housewares and fans 47 Gift, novelty, and souvenir shops
Key Competitors
Macy's Department store
Target Discount Store
Wal-Mart Discount store
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Other Competitors
Anna's Linens J. C. Penney
Art.com Kmart Macy's
Babies "R" Us Pier 1 Imports
Burlington Coat Ross Stores
Factory Saks
The Children's Place Sears
Container Store Sensational Beginnings
Cost Plus Target
Dillard's TJX Companies
Euromarket Designs Tuesday Morning Corporation
Garden Ridge Wal-Mart
Gymboree Williams-Sonoma
IKEA
ANSWERS TO DISCUSSION QUESTIONS AND PROBLEMS
1. Distinguish between variety and assortment. Why are these important elements of retail
market structure?
The main difference between variety and assortment is that variety refers to the number of
different merchandise categories a retailer sells, whereas assortment is the number of
different items or SKUs in a merchandise category. In addition, variety is often referred to as
the breadth of merchandise carried by the retailer, and assortment is referred to as the depth
of merchandise. These elements form an integral part of the retail market structure, since it is
the retail offering that ultimately distinguishes one retailer from another.
2. What sorts of competitive pressures are confronting traditional grocery stores? What
options do these stores have to ease these pressures?
Supermarkets are under competitive pressures from supercenters, warehouse clubs, extreme-
value retailers, convenience stores, and even drug stores. These retailers have increased the
amount of space that they provide for consumables. In addition, these competing retailers offer
food merchandise to build the traffic in their stores and increase the sales of more profitable
nonfood merchandise. To compete against these stores, supermarkets are offering more fresh
merchandise, green merchandise, ethnic merchandise and private label merchandise. In addition,
supermarkets are also working on ways to enhance the store ambience and customer service to
provide a more enjoyable shopping experience.
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3. What do off-price retailers need to do to compete against other formats in the future?
The main competitive weapon for the off-price retailers is their low price. While they may
not directly compete with higher service formats, such as department and specialty stores,
they do face increasing competition from discount stores. Here, the off-price stores may be at
a relative disadvantage since their merchandise is based upon opportunistic buying, while
discount stores offer a relatively stable mix of merchandise at stable prices (everyday low
pricing).
Since the option of improving service may increase costs and weaken their only source of
competitive advantage, low price, off-price retailers should focus on strategies to keep their
costs and prices low and explore low cost methods of attracting and retaining customers. In
terms of keeping operational costs low, they can locate in lower cost urban and rural areas
(note that outlet stores are more clustered within outlet malls located farther from the city but
near major highways). They can also implement more efficient inventory and merchandise
management systems (note that for a discount store, such as Wal-Mart, operational efficiency
and costs reductions are crucial to offering lower prices to customers). Also, they can expand
their sourcing to include imports from low cost international markets.
Another threat for off-price retailers may be from Internet stores. Often several stores
publicize their low prices and also attempt to match consumer price preferences through
reverse bidding and auctions (sites such as Priceline and eBay). Off-price retailers can
explore the possibility of using the Internet for relatively low cost advertising about current
merchandises (since their merchandise stocks fluctuate more rapidly due to opportunistic
buying). Factory outlet stores, on the other hand, can compete more directly over the
Internet.
4. Compare and contrast the retail mixes of convenience stores, traditional supermarkets,
superstores, and warehouse stores. Can all of these food retail institutions survive over
the long run? How? Why?
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Element of Traditional
Retail Mix Convenience Store Supermarket Superstore Warehouse Store
Location Typically Typically in strip Typically in strip Typically in strip
freestanding, easily shopping centers shopping centers shopping centers
accessible sites
Merchandise Limited variety and Average variety and Greater variety with Greater variety with
Assortment assortment assortment deeper assortment about the same
than supermarket assortment as
supermarket. Primary
difference is that
merchandise assortment
varies because of
opportunistic buying.
Pricing Higher pricing than Average pricing. Lower pricing than Lower pricing than
supermarkets Some chains have supermarkets. supermarkets. Pricing
constant (every day) Typical every day depends on cost of
pricing and others pricing. merchandise bought on
have special sale special buys.
(high-low) pricing.
Advertising and Limited advertising, High-low pricing Limited advertising Minimal promotion
Promotion frequent shopper chains advertise since most have since all merchandise is
programs tied to weekly specials. everyday pricing. basically on sale.
gasoline sales.
Personal selling Minimal Minimal Minimal Minimal
Store design and Designed for quick Typically use a grid- Same as Same as supermarket. A
display and easy merchandise iron with cross-hatch supermarket. bit more disorganized to
selection and aisles, extensive give the customers the
checkout signs. feel of searching for a
bargain.
Service Minimal Some services for Some services for Minimal

produce, bakery, produce, bakery,
meat and fish meat and fish areas.
categories.
All four types will persist because they appeal to different customer needs. The warehouse
stores typically have larger pack sizes that are very attractive to customers with large families
and to small business owners like local restaurants. In addition, due to the varying
assortments, customers who are brand loyal might not want to shop in these stores.
Convenience stores are located and designed to offer customers a snack, quick meal or
minimal grocery/general merchandise purchase along with their gasoline. These retailers
offer easy in and out access and speedy transactions. In response to competitive pressures
from other food retailers, as well as dependency on gasoline sales, many convenience stores
are now offering consumers fresh food and healthy fast food choices to reduce dependency on
fuel sales while maintaining on-the-go ease and convenience.
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The superstores are low in price but more inconvenient to shop in because of the large size.
Thus they appeal to customers who are very price conscious and are willing to drive a longer
distance and spend more time shopping in a larger store.
Conventional supermarkets are the most convenient. In major metro areas, there is a
conventional supermarket two to three miles from everyone’s home. They also provide more
services for customers such as cutting meat to order. Conventional supermarkets appeal to
customers who value service and convenience and are not as price conscious.
Note that the same consumer may shop at all four types of food retailers depending on the
nature of the shopping trip. For example, a consumer might stock up on basic such as toilet
paper, soft drinks, and can goods at a warehouse or superstore and then go to a supermarket
to buy meat, produce, and gourmet food.
5. Why is Walmart, the largest retailer in the world, facing slower growth than in the
past? What can it do to accelerate its growth?
Full line discount stores, like Walmart, face challenges from category specialists that
dominate specific product categories. In response to this pressure, Walmart has converted
many of its stores into supercenters that are more efficient and generate higher traffic. In
addition, Walmart is expanding to more urban locations using smaller storefronts.
6. Why are retailers in the limited assortment supermarket and extreme value discount
store sectors growing so rapidly? From which retailers are they getting these additional
sales.
Both limited assortment supermarkets and extreme value discount stores focus on relatively
limited merchandise offerings at highly appealing (low!) prices. The retail formats are able to
offer their extremely low prices through maximizing efficiency. By reducing extras and
service offerings, as well as managing a relatively low merchandise assortment, these
retailers are able to provide consumers with the “thrill of the hunt” for amazing deals.
Extreme value retailers are attracting customers away from supermarkets and supercenters.
7. The same brand and model of tablet is sold by specialty computer stores, discount
stores, category specialists, online retailers and warehouse stores. Why would a
customer choose one retail format over the others?
Each type of retail store provides a unique combination of price and services tailored to the
needs of different types of customers. The specialty store typically will have higher prices,
but will offer more services. It will have salespeople with technical expertise available to
provide information to customers and answer questions. This service is particularly valuable
to customers who do not know much about computers.
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On the other hand, discount stores, category specialists, and warehouse stores have lower
prices and do not offer much personalized service. These stores are more attractive to
customers who have more expertise and do not need personalized service.
Due to the greater assortment in category specialists, customers are able to compare the prices
and features of different brands in one store visit. Warehouse and discount stores have
limited assortments and thus customers can only see a limited set of brands and models. But
they can also buy merchandise in different product categories at the same time they are
buying a computer.
Some customers will prefer the convenience and selection offered online. The Internet may
also be used to collect information and compare features and prices prior to shopping in a
store location.
8. Choose a product category that both you and your parents purchase (e.g., business
clothing, casual clothing, music, electronic equipment, shampoo). In which type of store
do you typically purchase this merchandise? What about your parents? Explain why
there is (and is not) a difference in your store choices.
Students may emphasize specialty stores such as The Gap, Old Navy, Abercrombie and Fitch,
Express, and Best Buy etc. for their purchases for clothing, or electronic equipment, while
mentioning that their parents favor traditional department stores such as Macy's or Sears for
the purchase of such product categories. If price is a major factor, there may be some
similarities between the students and their parents; both may shop at discount stores.
The merchandise, service and prices for the various retail formats stocking different product
categories are different. In general, stores deliberately targeting a younger population will be
favored by students since these stores would better match their expectations of merchandise
(such as fashion clothing), prices and services (students may consider themselves savvy
customers for certain products, such as music and electronic equipment, and may not need
the type of service demanded by their parents for instance in purchasing business clothing).
9. At many optical stores you can get your eyes checked and purchase glasses or contact
lenses. How is the shopping experience different for the service as compared to the
product? Design a strategy designed to get customers to purchase both the service and
the product. In so doing, delineate specific actions that should be taken to acquire and
retain optical customers.
Optical stores present an interesting mix of service and related merchandise. On one hand,
the eye examination is usually done by a trained and licensed eye doctor and here the service
experience is often very professional and similar to a visit to any physician or hospital. On
the other hand, the glasses or contact lenses are displayed in a retail store setting with the
service being mostly oriented towards helping the customer try out various options. The
contrasts between the service and retail environments may be unnerving for some customers.
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One strategy to reduce the gap is to ensure that the retail setting is very professional and
courteous. Since the problem has been detected and identified by the eye doctor, the sales
staff in the retail setting could engage and interact more directly with the customer with more
of a problem-solving approach. This would involve educating consumers on various issues,
including the merits/demerits of using glasses or contact lenses, the types of lenses and
coatings, proper care of glasses and contact lenses, etc.
It must also be recognized that most customers who are prescribed glasses for the first time
are likely to continue wearing glasses or contact lenses for the rest of their lives. Thus, it is
important to start building consumer trust and confidence through professional service and
expertise. One strategy would be to encourage customers to return for an eye examination
every year and also have their current prescription for the glasses or lenses checked. Another
is to provide free repair service for the frames.
10. There are services and products involved when buying or renting a car, and in both
cases, the customer drives away in a car. But buying a car focuses more on the product,
whereas renting involves the service. Explain four ways in which marketing for a
rental car company differs from marketing for an automobile dealership.
The differences in offerings provided by service retailers include (1) intangibility, (2)
simultaneous production and consumption, (3) perishability, and (4) inconsistency of the offering
to customers. Although the automobile at the rental car company is tangible, the experience of
renting is an intangible offering. The services surrounding the accessibility of the car rental or
what is most important to the customer. Similarly, the service is consumed at the same time it is
being produced. This differs from the experience of purchasing a car. The rental car service is
also perishable. If a day goes y and an car is not rented, the revenue from renting the car for that
day is gone forever, making the rental car service perishable. Finally, the experience with the
rental car company may be inconsistent. As personalities and training programs might differ by
location, the experience the consumer has with a rental car provider at different locations may
vary significantly.
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ANCILLARY LECTURES
LECTURE # 2-1: FRANCHISING

--------------------------------------------------
Instructor’s Note: Franchising is one of the most popular and successful ways for individuals to start their
own business. The growth in franchising as a retail format will probably continue in the near future.
Many students who take a retailing course have intentions of someday starting their own business and
this lecture may provide them with an interesting possibility to consider. Instructors might want to use
this lecture as a stimulus to a class discussion on the topic. PowerPoint slides 2-59 to 2-67 can be used with
this lecture.
--------------------------------------------------
Introduction
Franchising is the licensing of an ENTIRE business format by a parent company

(FRANCHISOR) to a number of outlets (FRANCHISEES) to market a product or service and
engage in a business developed by the FRANCHISOR using the FRANCHISOR’S trade
names, trademarks, know-how, and methods of doing business.
In 1985, sales of goods and services by all franchising companies exceeded $529 billion,
approximately 33 percent of all U.S. retail sales flow.
There are roughly half a million establishments in franchise-related businesses.
The growth of franchising
Franchising has had a steady stream of growth. Some of the reasons include
1. Technological advances,
2. Profitable utilization of capital resources,
3. Attainment of the American dream,
4. Demographic expansion, and
5. Product/service consistency.
Technological advances
Equipment and systems--reduce product variability and more efficient marketing and
distribution systems.
For example: Electronic Data interchange.
Profitable utilization of capital resources
Can tap savings and credit capacity of individuals to realize national product/service
saturation
Attainment of the American dream
Owning your own business.
Demographic expansion
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Urban “sprawl” creates need for more small retail establishments.

No-longer just downtown locations.
Product/service consistency
Due to geographic mobility, franchises have provided a level of homogeneous (boring)
quality in its product or service.
For example: A Big Mac tastes the same everywhere.
Types of franchise systems
There are various types of franchise systems including
1. Territorial,
2. Operating,
3. Mobile,
4. Distributorship,
5. Co-ownership,
6. Co-management,
7. Leasing/Licensing,
8. Manufacturing, and
9. Service.
Territorial franchise
The franchise granted encompasses several counties or states.
The holder of the franchise assumes the responsibility for setting up and training individual
franchisees within his territory and obtains an ‘override” on all sales in his territory.
For example: McDonalds and Burger King Regional franchises.
Operating franchise
The individual independent franchisee that runs his own franchise.
He deals either directly with the parent organization or with the territorial franchise holder.
For example: McDonalds and Burger King individual locations.
Mobile franchise
A franchise that dispenses its product from a moving vehicle, which is either owned by the
franchisee or leased from the franchisor.
For example: Country Store on Wheels and Snap-On Tools.
Distributorship
The franchisee takes title to various goods and further distributes them to sub-franchisees.
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The distributor has exclusive coverage of a wide geographical area and acts as a supply house
for the franchisee that carries the product.
For example: Texaco gasoline supply centers.
Co-ownership
The franchisor and franchisee share the investment and profits.
For Example: Denny’s Restaurant.
Co-management
The franchisor controls the major part of the investment.
The partner-manager shares profits proportionately.
For example: Travelodge and Holiday Inn.
Leasing/Licensing
The franchisor leases/licenses the franchisee to use his trademarks and business techniques.
The franchisor either supplies the product or provides franchisees with a list of approved
suppliers.
For example: Sheraton Hotels.
Manufacturing
The franchisor grants a franchise to manufacture its product through the use of specified
materials and techniques.
The franchisee distributes the product, utilizing the franchisor’s techniques.
This method enables a national manufacturer to distribute regionally when distribution costs
from central manufacturing facilities are prohibitive.
For example: Sealy.
Service
The franchisor describes patterns by which a franchisee supplies a professional service, as
exemplified by employment agencies.
For example: Personnel One.
Why franchises fail
Individuals who are interested in franchising need to recognize that there is risk despite the
high potential for success.
Franchises can fail for several reasons including
1. Inept management,
2. Fraudulent activities, and
3. Market saturation.
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Inept management
Poor finances, product/service mix rejected, grew too quickly.
Fraudulent activities
The selling of unsound or unproven franchises to ignorant buyers, unfair contracts, etc.
Market saturation
Too many franchises of same type, e.g., chicken fast-food.
Franchisors and the marketing channel
A franchisor may occupy any position in the marketing channel.
Manufacturer-retailer franchise
Automobile dealers and service stations.
Manufacturer-wholesaler franchise
Coca-Cola, Pepsi, Seven-Up, etc. sell syrup they manufacture to franchised wholesalers who
bottle and distribute to retailers.
Wholesalers-retailer franchise
Rexall Drugs and Sentry Drugs.
Service Sponsor--Retailer franchise
Avis, Hertz, and National, McDonald’s, Chicken Delight, KFC, Howard Johnson’s and
Holiday Inn, Midas and AMCO, Kelly Girl and Manpower
Franchisor benefits
Franchisees (the store) provide benefits for the franchisor (the parent company).
Continuous market
Insured through consistent quantity and quality and strong promotion.
Market information
Information such as sales, local advertising, employee turnover, profits, etc. is usually
provided.
Money
Principal sources of franchise company revenue.
Royalty fees
Royalties provide continuous income although often the rate may decrease as sales volume
increase.
Sometimes a flat rate is established regardless of level of sales.
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Sales of products
Often the franchisor supplies raw materials and finished products to the franchisee at a profit.
For example, Coke supplies syrup, Holiday Inn supplies furniture and carpeting.
Rental and lease fees
The franchisor may lease buildings, equipment, and fixtures.
License fees
There may be special fees that allow the franchisee to use and display the franchisor’s
trademark.
Management fees
Franchisor can charge for consultant fees, management reports, training, etc.
Franchisee benefits
Franchisors provide benefits for the franchisee through initial and continuous services. .
Initial services
There are a number of initial services that franchisors provide for franchisees including
1. Market survey and site selection,
2. Facility design and layout,
3. Lease negotiation advice,
4. Financing advice,
5. Operating manuals,
6. Management training programs, and
7. Employee training.
Continuous Services
There are also a number of continuous services that franchisors offer to franchisees including
1. Field supervision,
2. Merchandising and promotional materials,
3. Management and employee retraining,
4. Quality inspection,
5. National advertising,
6. Centralized purchasing,
7. Market data and guidance,
8. Auditing and record keeping,
9. Management reports, and
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10. Group insurance plans.

Franchisor advantages/disadvantages
Depending upon which viewpoint one takes (the franchisor or franchisee) there are many
advantages and disadvantages of franchising.
From the perspective of the franchisor, the advantages include
1. Rapid expansion,
2. Highly motivated franchisees do a good job, and
3. Additional profits by selling franchisees products and services.
The disadvantages include
1. Company-owned units may be more profitable,
2. Less control than independent retailers over advertising, pricing, personnel practices, etc. (e.g.,
can’t fire franchisee).
Franchisee advantages/disadvantages
From the viewpoint of the franchisee the advantages include
1. Established/proven product/service,
2. Business and technical assistance, and
3. Reduction in risk.
The disadvantages include
1. Loss of control -- are really only semi-independent business people,
2. Many franchisors own a number of their outlets which may compete with those owned by
franchisees, and
3. High royalties, fees, costs of equipment, supplies, merchandise, rental or lease rates and
mandatory participation in promo and support services.
Franchising trends for the New Millennium
Most of the growth of franchising occurred in the 1980s in the retailing of goods and
services. However, there two basic types of franchising that merit consideration.
The first, product and trade franchising, a common form of retailing in the automobile and
petroleum industry, focuses on what is sold.
Examples include brands like Ford, Honda, and Texaco.
The second, business format franchising, sells the right to operate the same business in
different geographic locations.
The emphasis here is on how the business is run.
Examples include Kentucky Fried Chicken, McDonald’s and Burger King.
The major franchising trends perceived for New Millennium are
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1. Sustained growth,
2. Enduring plus unimagined applications,
3. International expansion,
4. Increased tensions, and
5. Greater emphasis on financial returns.
Sustained Growth
It is perceived that franchising will continue to grow steadily, a trend begun in the 1980s.
One of the possible explanations for this growth is that franchising offers franchisors rapid
expansion as well as highly motivated owner-managers.
Also, annual growth in franchised sales volume will exceed the inflation rate by several
percentage points.
Enduring plus unimagined applications
Today, such things like video yearbooks, house-sitting services, and house calls by doctors
may be owned by franchises.
With the applications such as these, the possibilities are certainly diverse.
For example, in the future, franchisees will come from three main sources, which include
middle managers, women, and independent small-business owners.
International expansion
Franchisors are currently exploring foreign markets.
In fact, in 1988 one-sixth of all business-format franchisors had businesses outside the United
States.
In addition, this trend has also been reciprocated by foreign franchisors as well.
However, non-U.S. franchisors have had a more difficult time in the U. S. due to stiff
competition.
Increasing tensions
Despite the overwhelming of franchisors on the whole, there is still a major source of
contention.
That is, franchisor-franchisee relations have witnessed a rise in class-action suits and
arbitration hearings.
In 1989, over 400 franchisee-related hearings were held.
Dissatisfaction among franchisees could originate from various sources.
First, perceived inequity among this group regarding mandated or proposed changes may be a
major source of conflict.
Also unsatisfactory financial performance may be another cause of discord.
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Greater emphasis on financial returns

The main sources of financial returns include: dual operations in which a franchisee may be
permitted to run two or more franchises from a common or adjacent area; reduced costs due
to downsizing; and incentives for ownership.
[Source: This lecture was adapted from Gerald Pintel and Jay Diamond, Retailing, 4th ed.
(Englewood Cliffs, NJ.: Prentice-Hall, 1987), pp. 73-76. in El-Ansary and Stern’s book,
Marketing Channels, Prentice-Hall, 3rd. ed. , 1988, p. 333); Bruce J. Walker, “Retail
Franchising in the 1990s,” Retailing Issues Letter, Published by Arthur Andersen & co, in
conjunction with the Center for Retailing Studies, Texas A&M University, Vol.; 3, No.1, January
1991, pp. 1-.]
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Another random document with
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shapeless rubble and smouldering ruin on all sides bore witness to
Hun methods of frightfulness.
We at length came in sight of Arsiero and had to leave the car as
the road, which had been getting more and more choked with débris,
now became impassible. Moreover, big shells were coming over with
persistent frequency, and we could not afford to take any risk of our
transport being injured. We had no desire to walk back.
One must have seen the Front here for oneself in order to form
any conception of what the Austrian thrust meant, and how near it
was to succeeding.
Arsiero is situated in the valley of Astico; behind it is the semi-
circle of mountains which form the boundary of the tableland of the
Altopiano, so close as to dominate it completely, foremost amongst
these mountains being M. Cenzio and M. Cimone, standing up like
colossal barriers above the valley.
From the point of view of an artist it would be difficult to conceive a
more delightful panorama than one had before one’s eyes: it was a
glorious picture waiting to be painted in peace time, but you felt that
there was nothing attractive about it from the military point of view. If
an enemy were in possession of all these superb heights, then the
positions in the valley below would be very undesirable, to say the
least of it; and without any knowledge of military matters you realised
that the valley and all that it contained—towns, villages, vineyards
and what not—was completely at the mercy of the men who manned
the guns up above, and also that under cover of these guns
immense masses of troops could be safely brought down the side of
the mountains on to the plains, and established there pending further
movements.
Following up your thoughts as an amateur strategist, you could not
fail to come to the conclusion that the valley was as good as lost if
such a contingency came to pass, unless the defenders could
achieve what looked like a sheer impossibility, and drive the invaders
from their positions on the plain and back again up the mountain
side.
The idea of such a possibility was too fantastic to waste a thought
on it. Yet this is actually what happened during that fateful week
when Italy was on the brink of disaster.
On the road leading to the town there were signs everywhere of
the Austrians, and of the desperate fighting that had taken place
here only a few days previously. I had thought that there might be a
certain amount of panicky exaggeration in the reports of the extent of
the Austrian advance towards the place, but there were
incontestable proofs in the shape of trenches, barbed wire and so
forth pushed forward well in front of Arsiero.
Every yard of the enemy’s advance had been methodically
consolidated, but nothing had stopped the rush of the Italians—their
blood was up for vengeance—they were fighting on Italian soil and
on their way here had passed through the devastated villages and
ruined countryside, and had heard tales of outrage and infamy.
It was a case of God help the Austrians if they caught up with
them, for along the whole Front there had been considerable
evidence of the enemy’s barbaric methods; in one place, for
instance, near Magnaboschi, hundreds of naked corpses of Italian
soldiers were found in the mire.
With the knowledge of what they might expect if the Italians got to
grips with them, the Austrians, once they got on the run, never
stopped till they were safely back in their old positions, and here they
were putting up a stubborn fight when I was in Arsiero.
They were not beaten by any means, although driven from Italian
soil. That General Cadorna was evidently aware that any relaxation
of pressure would have brought them on again was substantiated by
the number of troops he was keeping in this sector.
Arsiero had suffered considerably, and although not entirely in
ruins, as has been stated, was more damaged by fire and shell than
any place in Italy I had yet seen.
On the outskirts of the town the gairish nouvel art villa of the
famous Italian writer, Antonio Fogazzaro, which must have cost him
a little fortune to build was now but an unsightly ultra-modern ruin
standing in the midst of a wilderness of park-like grounds. One of the
most advanced of the Austrian communication trenches leading into
the valley started from here.
A little distance further down the road were the immense paper-
mills of Rossi and Co., said to have been the largest in Europe, and
which employed hundreds of workpeople.
The buildings were absolutely wiped out. They had been
deliberately set fire to by the Austrians before they evacuated the
town. Nothing remained now but acres of crumbling walls,
smouldering timber, and twisted débris of machinery, over which
hung a pall, as it were, of smoke, a pitiful spectacle of wanton,
insensate destruction.
The town itself, a picturesque, rambling, up-hill and down-dale sort
of place was only destroyed in patches, but with the shells still
coming over there was yet a possibility of its utter destruction.
As the gun-fire seemed to have lulled a bit, we had a stroll up to
the battlefield on the hill beyond the houses. There a barrage of
shell-fire had evidently been attempted, judging from the fragments
of shell-cases of all calibres lying about. In places the ground was
littered with the detritus of war, and looked like an old-iron and rag-
refuse heap. Here and there were interesting curios and many
unexploded projectiles in perfect condition. It occurred to me that I
would take one of these away with me as a souvenir for my studio,
and was stooping down to pick up one when a soldier, who was
passing, rushed towards me yelling out at the top of his voice, “Non
toccate! non toccate! Signore.”
I did not understand much Italian, but I knew enough to
comprehend that I was not to touch it, and thought it strange that
with all this rubbish lying about I could not take something if I fancied
it.
My companion came up at that moment and explained to me that
it was most dangerous to handle these unexploded live shells—even
walking too close to them has been known to cause them to explode.
I did not want any further telling, and contented myself with taking an
empty .77 as a souvenir.
But nothing had stopped the rush of the Italians (see page 158)
To face page 160
CHAPTER XIII
The fighting on the Asiago plateau—Brilliant counter-offensive of

General Cadorna—I go to Asiago—Wonderful organization of Italian
Army—Making new roads—Thousands of labourers—The military
causeway—Supply columns in full operation—Wonderful scenes—
Approaching the scene of action—The forest of Gallio—The big
bivouac—Whole brigades lying hidden—The forest screen—
Picturesque encampments—The “bell” tent as compared with the
tente d’abri—Our car stopped by the Carabinieri—“Nostri Canoni”—
We leave the car—The plain of Asiago—The little town of Asiago in
distance—The Austrian and Italian batteries and Italian trenches—
Hurrying across—The daily toll of the guns—Asiago in ruins—Street
fighting—Importance attaching to this point—An ominous lull—
Regiment waiting to proceed to trenches—Sad spectacle—The
quarters of the divisional commandant—His “office”—Staff clerks at
work—Telephone bells ringing—The commandant’s regret at our
coming—Big artillery attack to commence—A quarter of an hour to
spare—A peep at the Austrian trenches—A little ruined home—All
movements of troops to trenches by night—Artillery action about to
commence—Not allowed to go to trenches—Adventure on way back
—Attempt cross no man’s land at the double—My little “souvenir” of
Asiago—Bursting shells—Ordered to take cover—The wounded
soldiers and the kitten—Anything but a pleasant spot—The two
Carabinieri—Cool courage—In the “funk-hole”—An inferno—My own
impressions—Effect on soldiers and our chauffeur—The wounded
sergeant—We prepare to make a start back—Irritating delay—A
shrapnel—My companion is wounded—Transformation along road—
Curious incident.
CHAPTER XIII
The Austrian thrust was not confined to the Arsiero sector, although it
was undoubtedly there that they made their greatest effort in men
and guns. The Asiago plateau in the district of the Sette Communi
was the scene of desperate fighting simultaneously with that around
Arsiero.
The counter-offensive of General Cadorna in this direction was, if
anything, more brilliantly conceived and carried out than in the Astico
valley, and that is saying a great deal. But here again, although
driven back, the enemy was by no means beaten, and continued to
fight sullenly for every yard he was forced to yield. Although the
Italians were pressing closely on the enemy’s heels, it was a tough
job to keep him on the move, as I was able to judge for myself.
I went up to Asiago on my return from Arsiero, and must admit I
was astounded at all I saw; it was inconceivable that so much could
have been accomplished in so short a time.
I have so often insisted on the wonderful organization of every
branch of the Italian Army that I hardly like to revert to it again, but I
had just returned, after having been away for several months, and I
found that my impressions were precisely the same as in the
beginning of the war; preparedness is still the mot d’ordre. An
instance of this will serve to convey my meaning.
It is uphill most of the way to the tableland where Asiago is
situated, and before the Austrian onslaught the roads to the plateau
were of so rough and primitive a description as to be quite
inadequate to meet the requirements of the immense transport
service of the army being sent up.
In order to cope with the exigencies of the situation drastic
measures had to be adopted, which were evidently foreseen and
arranged for in the event of certain contingencies such as the
present one arising.
Thousands of labourers, young and old, of the military classes not
yet called up, but who undoubtedly had been warned for this duty,
were brought from all over the country, provided with picks and
shovels and sent here by express trains. Without the delay of an
hour practically, they were set to work to cut down obstructing trees
and widen, build up and level the existing roads.
Of course they were well paid: five lires a day and their food
provided, but it was not a mere question of pay—of that you cannot
fail to be convinced—only men working with their hearts in their job
could have accomplished what these gangs of men did in the time. It
is truly an object lesson in the value of organized labour.
The fine broad highway, complete in every necessary detail, such
as stone parapets at the curves, and walling-up where there is risk of
landslides, came into being as though by the touch of a magician’s
wand, and proved of incalculable value in the counter-attack which
was meanwhile preparing. The transport of the masses of troops
synchronizing with the completion of the roads.
Certain it is that without such organization it would have required
many weeks to have carried out what was done in a few days, and in
the meantime the invaders, it is to be assumed, would not have been
idle on their side.
When I motored up to Asiago, had I not been told how long this
roadway had been in existence I should have said it was years old,
instead of days.
Along this military causeway was as busy and animated a scene
as could be imagined. The Italians had already recaptured all the
positions in the Sette Communi, and were pushing steadily on
towards the Altopiano beyond Asiago.
The supply columns were, therefore, now in full operation, and one
passed what was practically an endless convoy of munition trains,
motor lorries, picturesque carts from every corner apparently of the
peninsula, and long strings of pack horses and mules. In and out of
this imposing column and up the steepest parts of the road dispatch
riders on motor bicycles dashed along with reckless speed and
marvellous dexterity.
It was a wonderfully inspiriting scene, and this was accentuated as
one gradually began to hear the booming of the Italian guns in the
distance. We were rapidly approaching the scene of action, and the
Austrians were being given no respite.
The effect of all this, together with the glorious air of the mountain,
was as exhilarating as champagne—one felt years younger. The car
seemed to go too slowly, so eager were you to get on, and be in the
thick of it all.
The mountain side was bare and bleak, with scarcely a vestige of
tree or shrub—but on the tableland beyond the crest it gradually
changed, and we entered a belt of pine forest, dark and gloomy.
This was the forest of Gallio. The road wound in and out of the
dense trees, and only a short distance ahead could be seen. We had
now passed the head of the transport convoys, and came up with
reinforcements hurrying forward.
A remarkable scene now presented itself. The forest on either side
of the road was a big bivouac. The gloom under the trees was alive
with troops as far back as one could see. Every yard of ground
appeared to be occupied, whole brigades were lying hidden here
waiting the order to advance. No more effective screen could have
been wished for than this belt of forest, and it must have been a
continual source of anxiety to the Austrian generals to know what it
concealed.
It was probably for this reason that the forest of Gallio was the
hottest section of this Front, as it was continually being shelled, and
the casualties were always correspondingly heavy.
There was something singularly reminiscent of mining scenes in
the Far West in all I saw around me as many of the men had erected
their picturesque little tentes d’abri and formed little encampments in
all sorts of out-of-the-way corners. The soldiers were apparently
allowed considerable latitude in this respect, possibly because these
tents are so easily handled, and by reason of their small dimensions
are easily disguised with foliage.
The big and cumbersome “bell” tent so fondly adhered to by the
British Army Authorities under all circumstances would have looked
very out of date here, where initiative not dogma reigned supreme!
After passing through what gave the impression of miles and miles
of encampment, we approached the confines of the trees, and were
suddenly hailed by two Carabinieri standing under the trees just off
the road, and informed that the car was not allowed to proceed any
further.[A]
[A] The Carabinieri have a special status in Italy, and only men of
the very highest character are accepted for the corps. In peace
time they are country constabulary, and patrol the rural districts; in
war they automatically become military police and are exclusively
employed in the immediate rear of the fighting line, watching for
deserters, looking after prisoners, carrying despatches, and so
forth. They only take orders from their own officers, and never do
any military service. On but one occasion have they become
combatants, and that was at the battle of Palestro in 1859, when
they saved the life of King Humbert by forming a square to protect
him. Their war footing is 50,000, of whom 8,000 are mounted.
Of course our chauffeur pulled up without hesitating: he knew that
Carabinieri have to be obeyed without parley. My companion got out,
and I was following him when, scarcely had I got my foot off the step,
than there was a deafening report like a thunderclap a few yards
away. For a moment I thought my head had been blown off.
“Sonoi Nostri Canoni,” remarked my companion, who had been
there before, and who knew of an Italian big gun hidden in the trees
within a few yards of us; one of many along the outskirts of the
forest, I was told later, and which were giving the Austrians much
trouble. We left the car here to await our return and walked on. A
hundred yards or so and we were clear of the forest, which ended
abruptly on the edge of a slight acclivity.
A little below us was a wide expanse of grass-covered plain, and
in the centre of it, about a mile away, were the white houses of the
little town of Asiago, of which one had read so much during the past
few weeks.
Just beyond the town a line of low-lying hills stood out against the
horizon. On the crest of one of these hills—Monte Interrotto—about
two and a half miles distant were the Austrian batteries, and on the
slopes below were the Austrian and Italian trenches. In the far
distance to the North, Monte Zebio stood out amongst some rugged
peaks.
For the moment the scene was fairly peaceful, that is to say the
guns on either side were only firing in a desultory way; but, of
course, one could not tell how long this would last and what might
“come over” at any moment; however, as we had come here with the
intention of going right into Asiago, this had to be chanced. My
companion advised hurrying across as quickly as possible as there
was no cover anywhere, and the road was quite exposed to the view
of the Austrian gunners.
It was a typical summer morning, with the birds singing merrily on
all sides, so it was somewhat difficult to realize that there was
danger in strolling along leisurely, but before we had gone far we met
stretcher-bearers coming towards us with their sad burdens, and
quite a number of soldiers carrying wounded men on their backs.
No big engagement was in progress we learned, but the guns and
rifles were taking their steady and relentless daily toll all the time.
This constant stream of wounded ended by getting on one’s
nerves, and made you wonder what the fates had in store for you.
The town, from a distance, appeared to be quite undamaged, but
on getting near to it one found it was in a sad state of ruins. Very few
of the houses had escaped the ravages of fire or bombardment.
The position of Asiago, midway between the opposing batteries,
had, of course, in a great measure brought this about, and was
responsible for its gradual destruction.
There was a great deal of street fighting before the invaders were
driven out and back to the hills, and in several places were hastily
erected barricades formed with broken furniture and other
miscellaneous articles. Barbed wire entanglements of a novel
construction were also placed in some of the streets in case the
Italian cavalry attempted to force a way through.
So Asiago was very closely connected with the stirring events that
were taking place, and from being an unheard of little frontier town,
had become one of the most spoken of places in Italy.
The fact that the communiqués referred to it almost daily is proof
of the importance attaching to this point, and it required ceaseless
vigilance on the part of the Italians to retain their foothold in its ruined
streets. But no attempt has been made to fortify the place, its
defences are the trenches on the hills beyond, and which, at the time
I was there, were gradually being pushed forward.
Any troops in the town itself were only there de passage for a few
hours. It would have been risking unnecessary sacrifice of life to
have kept them there for any length of time.
We were in about as exposed a position as could probably have
been found on any front, but for the moment there was an ominous
lull which portended no good, and so it turned out. The respite was
not to last long; the Asiago plateau is far too important a sector of the
front to be left long in quietude.
The little town must have been a delightful place before the war,
and even now, destroyed though it mostly is, there are a few
picturesque corners which the bombardment has spared. There
were comparatively very few soldiers about, and the deserted, ruined
streets looked unutterably sad; but right in the centre, on an open
piece of waste ground, sheltered by some tall houses and a roughly
made “screen” of odd pieces of corrugated iron, a regiment was
waiting for nightfall to proceed to the trenches outside the town.
I had a good look through an aperture in the screen: the men were
noticeably subdued in their demeanour, as well they might be,
considering that at any moment they might be under a hail of
projectiles and with no means of escaping it.
They had evidently been on the road for some time, as they all
looked grimy with dust and dirt and tired out, judging from the way
most of them were lying about sleeping. It was an extremely sad
spectacle, and I had no inclination to make a sketch of it, novel
though it was.
We enquired our way to the quarters of the Divisional
Commandant, as my companion had a letter to deliver to him, and
an officer we met sent some one with us to show us the house, as
outwardly there was no indication of its being occupied. The number
of deep dug-outs protected with sand-bags one saw everywhere was
sufficient proof of the awful time the men stationed here went
through. As we went along we were constantly meeting stretcher-
bearers bringing along wounded men. At the corners of streets men
were sheltering close up to the walls as though expecting at any
moment something to happen.
The Commandant’s “office” was in a house that had suffered
badly: there were gaping cracks in the walls, and it looked as if any
explosion near it would bring it down with a run.
There were quite a number of staff clerks at work in the ground-
floor rooms, and the telephone bells were ringing incessantly.
We were received by the Commandant with much cordiality, and
the position of affairs in the immediate vicinity explained to us very
lucidly by means of a big military chart fastened to a table in one of
the rooms, but he expressed regret at our having come just on that
particular day as a big attack by the artillery was timed to commence
at eleven o’clock (it was then 10.45), and he feared we should not be
able to get back so soon as we wished.
As though in defiant response to his statement, there was at that
moment a loud report from an Austrian battery, and a big shell
screeched by overhead.
There was still a quarter of an hour to spare before the Italian guns
were to start off, so the Commandant suggested our going upstairs
to the third floor to have a peep at the Italian and Austrian trenches
through a shell-hole in the roof. The house was quite new and built in
flats, which had evidently been occupied by fairly well-to-do people.
The room we went into had evidently been a sort of bedroom and
nursery combined: it was in a complete state of ruin, furniture
smashed, women’s clothes jumbled up all over the floor, with tiles
and bricks and mortar, here and there among the débris a child’s toy,
a broken doll, and what not, letters and papers strewn everywhere,
and all sodden with rain. There was something inexpressibly pathetic
in this little ruined home.
The Italian and Austrian trenches were but a few hundred yards
away, and only quite a short distance separated them. There was,
however, very little to see even through our powerful binoculars. The
whole hillside was very bare, and the trenches looked like mere
furrows in it, and yet one knew that these furrows were full of men
waiting the opportunity to get out and kill each other.
There was not a sign of life anywhere, as it meant certain death to
show yourself if only for an instant, the Commandant told me; even
where we were in this third floor room we ran the risk of being
spotted by some vigilant sniper, for the dilapidated roof offered very
little shelter.
All movements of troops up to the trenches were made by night,
and once the men were in position they were completely isolated, it
only being possible to take them their food once during the day, after
dark.
On the crest of Monte Interrotto opposite us, about fifteen hundred
yards distant, was a curious little squat-looking building which had, I
was told, been originally erected as a fort, but now it was merely a
landmark probably, and abandoned, or it would have certainly been
obliterated by the Italian artillery.
It was just upon eleven o’clock when we came down, and the
telephone bells were ringing furiously—the artillery action was
evidently about to commence.
My companion, who, by the way, had a camera with him,
suggested our going out to the trenches, but when he mentioned it to
the Commandant he was told that he, as an officer, could of course
go if he wished; there was nothing to stop him, but I could not be
allowed to accompany him under any circumstances.
The reason for this interdiction was not explained as far as I could
gather. There was, however, no arguing the matter, so rather than
leave me he decided that since that was the case, and there was
nothing more to see here it would be better if we chanced it and
made a dash back to the car whilst there was yet perhaps time.
Whilst we were talking, the Italian batteries were already opening
fire all along the line, though apparently only in a tentative range-
finding sort of way to start with, and the Austrians were beginning to
reply by dropping shells round Asiago, several big projectiles
bursting in the outskirts of the town.
It looked, therefore, as though we were going to have an exciting
time getting back, and so it turned out. The Commandant grimly
wished us luck, and off we went.
We had not got far when our adventures commenced. A big
shrapnel bursting right over us. Fortunately we had heard it coming,
so had time to get behind a wall. The fragments of the shell beat
down on the ground like Brobdingnagian hailstones.
After that the firing from both sides seemed to become general,
and it was evident that the attack was developing seriously.
Out in the open, as I have said, there was no cover whatever, so
there was nothing for it but to attempt to get across the mile of “No
man’s land” at the double.
Some soldiers, who were going across also, set the pace to start
with. I must regretfully confess, however, that I am long past
athletics, and even in my best days was never much of a pedestrian,
so I very soon had to give in and take it easily.
And came up with reinforcements hurrying forward (see page 165)
To face page 172
My companion, who was quite a young man, could without a doubt

have run the whole distance, but he good-naturedly slowed down to
remain with me.
Apart from my lack of stamina, I was somewhat severely
handicapped for sprinting, as, at the Commandant’s quarters I had
been given the butt-end of a big shell as “a little souvenir” of my visit
to Asiago.
It certainly was an interesting trophy, though a trifle weighty, as
may be imagined, and I did not want to leave it behind if I could help
it, as I have a mania for collecting war “curios” for my studio; but it
was a terrible temptation to drop it now and chance getting another
later on. However, I stuck to it like grim death and, I may add,
eventually brought it to London.
The idea of a man of my years and experience attempting to run a
mile in a blazing hot sun and under fire with a piece of iron weighing
some 12lbs. under his arm was doubtless ridiculous, and probably
my companion thought so, though he said nothing.
We had just got out in the open when we heard a terrific explosion
and, looking back, we saw that a shell of the biggest calibre had
burst in the town.
An immense column of white smoke and dust rose high in the air,
and in it you saw fragments of timber and other débris suspended by
the force of the explosion in the still atmosphere for what seemed a
few seconds—so long, in fact, that my companion actually had time
to get his camera out of its case and take a snapshot.
The artillery duel was now spreading ominously, and we could see
that shells were bursting unpleasantly near the spot where we had
left the car, the objective of the Austrians being, of course, the Italian
batteries along the edge of the forest.
About half way across was what looked like a railway embankment
or something of that sort, the road passing under it by a low archway.
There was a cottage close by, and when we got up to it we found
that it was a sort of infantry post in charge of a non-commissioned
officer, and that the soldiers who had preceded us had been ordered
to take cover here for a time—and we had to do the same—the
object of this evidently being to prevent too much movement being
seen on the road.
The cottage was little better than a shanty, and afforded no
protection whatever. In the one room were several badly-wounded
men lying on stretchers on the ground.
The thunder of the guns and the bursting shells outside did not
appear to affect them at all; in fact, two of the most heavily bandaged
were actually playing with a pretty little tabby kitten that, strangely
enough, was there. It was a curiously homely note, and singularly
out of keeping with its surroundings.
The sergeant detained us some little time, and then only allowed
us to go on singly and with intervals between. He evidently was
using his own judgment in the matter.
When we reached the forest the shells from the Austrian batteries
appeared to be passing overhead in a continuous flight, their wailing
screech sounding like a high wind in the tree-tops.
It was as if a gale were raging, accompanied by incessant crashes
of thunder. Branches of trees were being brought down by the shells
in every direction, and altogether it was anything but a pleasant spot
to find oneself in.
Yet close by, standing as calmly as though waiting for the storm to
pass, were the two Carabinieri we had previously seen, and who
were evidently on guard here.
In all my war experiences I have never witnessed anything to
surpass the sangfroid displayed by these two men. Neither the
bursting shells nor the falling trees appeared to perturb them in the
least. They were as unruffled as a London policeman on point duty. It
was a display of cool courage I shall long remember. Their horses,
standing just behind, shared their master’s composure; they showed
no signs of nervousness, and were not even fastened up.
I shall have occasion later to again refer to the remarkable
fearlessness of the Carabinieri—it was one of the things that
impressed me most on the Italian Front.
The car was not where we had left it, and the Carabinieri told us
that the chauffeur had thought it advisable to move it to a less
exposed place further up the road so as not to risk its being
smashed to pieces.
We hurried on and soon found the car, but no chauffeur. After
calling out for some minutes and with difficulty making ourselves
heard above the din going on; we saw him coming up from what
looked like a cellar under the trees.
This was a “dug-out” or what our English Tommies have
humourously designated as a “funk-hole,” and was constructed of
heavy timber covered with turf and several layers of sandbags. It
was entered by a short flight of steps, so we went down to have a
look at it. One might have been in a settler’s hut out in the wilds
somewhere, though for the matter of that all log shanties convey that
impression.
It was a very rough and gloomy place, but I was told that the King
had taken “cover” here only the day before, and had been forced to
stay in it for several hours.
Some soldiers were there, so we sat down with them and had a
chat, and it was well we did, for the firing increased in intensity every
moment, and heavy projectiles began to burst on the roof of the
“dug-out” with such terrific force that one expected at any moment
the whole place would be blown to atoms.
The very ground trembled under the shock of the explosions. I
never thought that human ears or nerves could stand such an
inferno as we were in for during the next hour.
The effect on me personally was at first a sort of atrophy of my
senses—a feeling came over me that if this was to be my end, well
let it be a quick and complete finish, no blinding or maiming or other
drawn out agony. Next a sensation of extreme hunger, which at the
time I felt inclined to pat myself on the back for, as indicating heroic
indifference to my surroundings, but which later I learned, to my
disappointment, is a well-known manifestation of “funk,” a form of
nervous dyspepsia—“fringale,” the French call it. But gradually these
impressions wore off, and I looked around with curiosity to see how
the young soldiers around me bore themselves.
Several were in a state of absolute terror at each explosion, and
were wringing their hands and ejaculating under their breath “Oh,
Dio—Oh, mamma!” whilst others sat stock still and gazed in front of
them in moody silence.
Our chauffeur was very much upset and made no attempt to
disguise it; so much so, in fact, that I wondered how on earth he
would be able to drive us back; his nerve seemed to be quite gone,
and his face was ghastly white.
Suddenly a soldier rushed down the steps calling out frantically
that the sergeant was mortally wounded and asking if anyone had
any brandy. No one had any, and I made a mental note never again
to be without a flask of it in my pocket. The poor fellow was lying just
outside the dug-out with his leg badly smashed up by a big fragment
of shell.
He was losing consciousness and kept sobbing and crying out for
his mother. Fortunately some stretcher-bearers were near by, so in a
very few minutes he was bound up with an improvised tourniquet to
stop the hemorrhage and hurried off to the nearest ambulance
station, though I doubt whether he ever reached it alive.
We returned to the dug-out as the firing shewed no signs of
abatement; but my companion began to get fidgetty, and at last said
we might have to stay there for hours if we waited till all was quiet,
and suggested our risking it and making a start.
Of course I could only agree; but the chauffeur was not so
anxious. He was, if anything, still more upset by what had just
happened; however, a few kind but forcible words brought him to his
senses, and with an effort he managed to pull himself together.
So we all went out somewhat anxiously to see if the car was still in
existence, and found that, fortunately, it had passed through its
ordeal of fire unscathed and had not been touched.
There was no time to lose, as may be imagined, with shells
bursting all round us, but as might have been expected, because we
were in a hurry to get away there was an irritating delay, and this
delay was directly the cause of an incident that now occurred, and
which might very easily have had a fatal result.
The car had to be turned round, not a quick operation at the best
of times, and especially in a narrow road, but under fire, a decidedly
nerve-testing job.
We were standing in the roadway watching with impatience the
apparently awkward manœuvres of the chauffeur when there was a
flash like lightning, a loud report and a shrapnel burst right over our
heads not more than twenty feet up.
Instinctively I raised my arm to shield my eyes, as I always do;
almost at the same moment I heard my friend, who was just by, call
out that he had been hit in the shoulder.
Looking round I saw him stoop down and gingerly pick up a long,
jagged fragment of shell lying at his feet. This was the piece that had
struck him—it was almost too hot to touch.
He said he did not think he was much hurt, and that it was no use
waiting there to do anything for it. So we lost no time in getting off
before something more serious happened; we were only asking for
trouble every moment we delayed.
As a matter of fact, although he made light of it, he had a nasty
flesh wound; it turned out that the strap of his camera case, together
with his thick overcoat and tunic, had undoubtedly saved his arm.
We had only gone a few yards when a remarkable state of affairs
revealed itself: the road had disappeared, so completely was it
hidden by trees and branches brought down by the shells.
It was positively startling to see such a transformation in the
comparatively short time that had elapsed since we had come along
it.
Here was a pretty fix, but luck favoured us in the shape of a
soldier, who saw our predicament and indicated a way of getting
round the obstacles and regaining the road further on.
I will candidly confess that I was not altogether sorry when we at
length got out of range of the Austrian guns.
We had been under fire for more than four hours, and I had had
about enough of it for one day.
There was a big stir amongst the troops bivouacked in the forest,
and we passed several regiments on the road, which led one to infer
that the artillery duel was to be followed up by an infantry attack on a
large scale at nightfall, and so it turned out, as I afterwards learned.
But these operations on the Asiago plateau were then, and are
still, of almost daily occurrence, and, serious though they may
appear when seen at close range as on this particular occasion, are
evidently but a side issue in General Cadorna’s main plan of
campaign.

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Retailers also differ in the services they

A critical retail decision involves the trade-

II. Food Retailers See PPT 2-13

Twenty years ago, consumers purchased

The world's largest food retailer is Wal-

Mart with supermarket-type sales of more

A. Supermarkets See PPT 2-14

A conventional supermarket is a self-

1. Trends in Supermarket Retailing See PPT 2-17

Today, conventional supermarkets are

Low cost competitors are especially

To compete successfully with intrusions by

deli and bakery departments), targeting

Conventional supermarkets are also

Through adjustments to the traditional

Conventional supermarkets chains are

The online grocery market also represents

Creating an enjoyable shopping experience

B. Supercenters See PPT 2-18 for an illustration of the

However, since supercenters are very

Hypermarkets are also large (100,000 to

Popular in both Europe and South

Supercenters place greater emphasis on

Although supercenters and hypermarkets

C. Warehouse Club See PPT 2-18 for an illustration of the

small businesses. warehouse clubs? (Consumers with larger

D. Convenience Stores See PPT 2-19 for an overview of the

In response to these competitive threats,

sales by tailoring their merchandise

To increase convenience, some

III. General Merchandise Retailers See PPT 2-20

A. Department Stores See PPT 2-21, 2-22, 2-23

Department store chains can be categorized

service (Neiman Marcus, Nordstrom); (2)

Today many customers question the

B. Full-Line Discount Stores See PPT 2-24

Target is becoming one of the most

C. Category Specialist See PPT 2-25

By offering a complete assortment in a

other retailers and thus are frequently

One of the largest and most successful

While merchandise in home-improvement

Competition between specialists in each

In response to this increasing competitive

D. Specialty Stores See PPT 2-26

Manufacturers are also opening their own

E. Drugstores See PPT 2-27

Drug stores, particularly the national

Drugstores are also being squeezed by

In response, drug store chains are building

Despite some of these chains’ names, few

The growing popularity of extreme value

Once considered low-status retailers

G. Off-Price Retailers Ask students to give examples of local off-price

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