Chapter Twelve

Retailing, Direct Marketing, and

Wholesaling
 Objectives

Describe retailing & wholesaling functions

Categorize retailers
Analyze patterns of U.S. retail history
Identify key retailer strategy elements
Explore impact of the Internet on retailing
Discriminate merchant wholesalers & agents
Describe contributions of wholesalers
Describe contributions of agent intermediaries
Identify key wholesaler strategy elements
Overview legal concerns with distribution channel
management
 Retailing

All business activities concerned with the sale of

goods and services to ultimate consumers.
 Classifying Retailers

Type of ownership
Prominent strategy
 Classifying Retailers by
Ownership

Independent Chain
Retailers Store
Retail
franchise

Corporate Ownership
Chain Group
 Classifying Retailers by
Strategy

In-Store

Direct
 Specialty Stores

Narrow variety
Deep selection
Personalized service
Examples:
Wallpapers to Go
Bookstore
Department Store

Chain operation
Wide variety
Full service
Examples:
Dillard’s
Macy’s
Bloomingdale’s
 Supermarkets

Wide variety of food

and nonfood products
Departmentalized
operations
Self-service
Centralized checkout
Examples:
Albertson’s
Safeway
 Convenience Stores

Limited variety
Shallow selection
Fast service
Examples:
7-11
STOP & GO
Circle K
Wawa
 Other In-Store

Mass merchandiser
Catalog showroom
Warehouse club
Specialty mass merchandiser
Off-price retailer
Category superstore
 Direct Marketing

Mail-order/direct

Door-to-Door
Vending

e-tailing
 Internet Retailing:
Advantages

Not location bound

Interactive
Convenient
24x7x52

Shopbots
 Internet Retailing:
Disadvantages

Examination

Privacy
 The Wheel of Retailing

Conventional
department
stores

High: status,
margin, price, service Mass
Prestige specialty merchandise
stores retailers

Low: status, margin

price, service
Warehouse clubs
 Retail Marketing Mix

DISTRIBUTION
PRODUCT

PLACE/
PROMOTION

PRICE
 Key Retail Issues

Merchandise assortment
Location
Atmospherics
Customer Service
Database management
Internet strategy
 Classifying Wholesalers

Merchant Wholesaler Agents

Take title No title to goods
~ 80% of all wholesalers Facilitators
National or regional Work on commission
Market experts
Wholesale Management
Strategies

Collaboration for
Relationships

Selecting Target Markets/

Create Assortments
 Regulation of Distribution

Exclusive dealing
Tying contracts
International issues
 Review

Describe retailing & wholesaling functions

Categorize retailers
Analyze patterns of U.S. retail history
Identify key retailer strategy elements
Explore impact of the Internet on retailing
Discriminate merchant wholesalers & agents
Describe contributions of wholesalers
Describe contributions of agent intermediaries
Identify key wholesaler strategy elements
Overview legal concerns with distribution channel
management