MANAGING RETAILING,

WHOLESALING AND
LOGISTICS
BY:-
SUSMIT SAHA AND EESHAN MOGHE
 What is Retailing?

 Retail is the sale of goods to end users, not for resale, but for use
and consumption by the purchaser.

 Retail is the process of selling consumer goods or services to

customers through multiple channels of distribution.
 Definitions of Retailing

 According to Kotler, “Retailing includes all the activities involved in

selling goods or services to the final consumers, for personal, non-
business use.”

 According to Merriam-Webster,” The activities involved in the

selling of goods to ultimate consumers for personal or household
consumption.”
 Types of Retailer

• Specialty Store • Discount Store

• Department Store • Off-price Retailer

• Supermarket • Superstore

• Convenience Store • Catalog Showroom

 Specialty Stores

 A specialist store is a shop that caters to one specific retail market.

 In other words, a shop that specialises in one type of products.

 Specialist stores such as – camera and accessories stores,

pharmacies, stationers and bookstores, Men’s and Women’s Clothing Etc.

 Example: Apollo Pharmacy, Reliance Digital, Reliance Trends, Croma Etc.

 Department Store

 Large retail establishment with an extensive assortment in variety

and range of (consumer)goods, organized into separate departments
housed under the same roof.

 Today, departments often include the following: clothing, furniture,

home appliances, toys, toiletries, sporting goods, paint etc.

 Example: Big Bazar, Walmart, Shoppers Stop Etc.

Department Store
 Supermarket

 Supermarket, large retail store operated on a self-service basis,

selling groceries, fresh produce, meat, bakery and dairy products.

 A large store that sells a variety of food and household items to

customers.

 Example: D-Mart, Best Price, Reliance Fresh Etc.

 Convenience Store

 A convenience store, convenience shop, or corner store is a

small retail business that stocks a limited range of everyday items.

 Such as coffee, groceries, snack foods, confectionery, soft

drinks,  toiletries, newspapers, and magazines.

 It is usually open until late at night.

 Discount Store

 A department store which offers its items at a lower price than many
other retail stores.

 Discount stores are often able to drop their prices due to efficient
distribution methods.
 Off-Price Store

 Off-price retailers are retailers who provide high quality goods at

cheap prices. They usually sell second-hand goods, off-the-season
items etc.

 They typically purchase overstocked goods, such as seasonal goods.

 Superstore

 Superstores are very large supermarkets or shops selling household

goods and equipment. Superstores are usually built outside city
centers away from other shops.

 Walmart.
 Catalogue Showroom

 Catalogue showroom usually refers to retail outlets which deal in

hard goods like electronics,  jewelry,  houseware etc. They are
located next to or in close proximity to their warehouses.

 These showrooms have low prices.

 Argos India.
 Levels of Retail Services

 Self-service
 Self-selection
 Limited Service
 Full Service
 Self-service

 A type of retail business where customers help themselves to locate-

select-compare process the products that they wish to purchase.

 Such as self-service food buffet, a self-service gas station or a self-

service market.

 Example: Amazon Go, Walmart

 Self-select

 Customer choses from a given selection.

 Here, the customers may walk in and choose what they want.
However, they might need more guidance and information.
 There are usually a few assistants (shop executives) to help the
customers choose.
 Most of the selection depends on the customers themselves.
 Example: Furniture store, amazon.com
 Limited Service

 Customers are provided service up to a certain extent.

 A retailer that provides only a limited number of services to

shoppers.
 Usually sells good at discount
 J.C. Penney
 Full Service

 Customers are provided service from the beginning to the end of

purchase.

 Example: Showrooms (car, bike, watches etc.)

 Non-store Retailing

 Any sale happening to the end customer which is not happening

through a traditional retail channel or through a physical retail space
is known as Non-store retailing.

 Non-store retailing refers to retailing that takes place outside

traditional brick-and-mortar (physical) locations.
 Non-store Retailing

 Direct selling
 Direct marketing
 Automatic vending
 Buying service
 Direct Selling

 Direct selling refers to selling products directly to the consumer in a

non-retail environment. Instead, sales occur at home, work, or other
non-store location.
 Direct Marketing

 The business of selling products or services directly to the public.

 E.g.: By mail order or telephone selling, rather than through

retailers.

 One of the significant benefits of direct marketing is that it enables

promoting products or services that might not be known to
consumers.
 Automatic Vending

 In automatic vending, electronic machine used to disperse a product

to a consumer after a certain amount of money has been put into the
machine.

 Vending machines are commonly used to disperse beverages, snack

items, magazines Etc.
 Buying Service

 It is a store less retailer serving a specific clientele

 Employees of a large organisation who are entitled to buy from a list
of retailers that have agreed to give discounts in return for
membership.
 Major Types of Corporate Retail
Organizations
 Corporate chain store
 Voluntary chain
 Retailer cooperative
 Consumer cooperative
 Franchise organization
 Merchandising conglomerate
 Corporate chain Store

 Two or more outlets that have common ownership and control,

centralized buying and merchandising operations, and similar lines
of merchandise are considered corporate chain stores.
 Example: Reliance Mart, Gap, Pottery Barn.
 Voluntary Chain

  A voluntary chain is a voluntary association of independent retailers

in a given line of business (as groceries or drugs) for collective
action in buying, advertising, and other phases of management.

 A voluntary chain store is a retail store that buys in bulk and is

independent from a cooperate chain of retailers.

 Example: Independent Grocers Alliance (IGA).

 Retailer Co-operative

 Retailers' cooperatives use their purchasing power to acquire

discounts from manufacturers.

  A retailers' cooperative is essentially a group of independently

owned businesses that pool their resources to purchase in bulk.
 Consumer Co-operative

 A consumers' co-operative is an enterprise owned and managed by consumers.

 Consumers' cooperatives often take the form of retail outlets owned and operated
by their consumers, such as food co-ops.
 Working mainly in housing, insurance, health care.
 Franchise Organisation

 It's a type of contractual association between a franchisor and a franchisee.

 In which a producer licenses a wholesaler to distribute its products.

 Example: McDonald’s, Subway, Pizza hut etc.

 Merchandising conglomerate

 Merchandising conglomerates combine several diversified retailing

lines and forms under central ownership, as well as integrate
distribution and management of functions.

 Merchandising conglomerates are relatively free-form corporations.

 Retailers' Marketing Decision

 Target market
 Product assortment
 Service/store atmosphere
 Price
 Communication
 Location
 Target Market

 A target market is a group of consumers or organizations most likely

to buy a company’s products or services.

 The target market typically consists of consumers who exhibit

similar characteristics (such as age, location, income or lifestyle).

 Once the target market(s) have been identified, the business will
normally tailor the marketing mix (4Ps) with the needs and
expectations of the target in mind.
 Product assortment

 Product assortment refers to the variety of products that a retailer

presents to the consumer.
 Main Characteristics:
(1) its length or number of products
(2) its breadth or number of product lines
(3) its depth or number of product varieties within a product line
(4) its consistency or how products relate to each other in a retail
environment.
 Service/Store atmosphere

 Store atmosphere includes the physical characteristics of a retail

store used to create an image to attract customers.

 It is a direct contributor to the customer experience, which is

the most important element of retail today.
 Price

 Prices are the key factor.

 Must be set in relationship with the target market, product
assortment mix and competition.
 Communication

 Retailers use a wide range of communication tools to generate

traffic and purchases.
 They place ads, run special sales, issue money saving coupons,
shoppers-reward programs etc.
 They place tasteful, full page ads in magazines.
 Retail category management

 Category management is the process of classifying

and managing product categories as strategic business units, rather
than simply viewing a retailer's offering as a collection of individual
products.

 According to Nielsen (1992): Category Management is a process of

managing product categories as separate business units and
customizing them to satisfying consumer needs.

 Example: Groceries. In groceries, vegetables, fruits, meat and fish.

 Retailer service Mix

1. Pre-purchase services
 It includes advertising, interior design, shopping hours, Fitting rooms.

2. Post-purchase Services
 It includes delivery, installation, exchange, gift wrapping.

3. Ancillary services (subordinate)

 It includes parking, restroom, sitting area, kids play area.
 Location Decision

 Central business districts

 Regional shopping centers
 Community shopping centers
 Strip malls
 Location within a larger store
 Central business District
 The most oldest and heavily trafficked city areas.
 Regional shopping centre

 An area containing 40 to 60 stores, with a

few well known chains like McDonald’s and
a number of clothing, footwear and
Consumer electronics stores.

  It provides a full range of shopping services

comparable to those found in a small central
business district.

 Specialty shops and boutiques are numerous,

and there are usually several restaurants. 
 Community Shopping Centre

 A shopping center of approximately and 20 to 70 stores, designed

for a mixture of retailer and food establishments.

 The community shopping center contains all of the above-mentioned

services in addition to a medium-sized department store.
 Strip Mall
 A shopping mall located on a busy main road.
 A strip mall is an open-air shopping mall where the stores are
arranged in a row, with a sidewalk in front.
 Store-within- a Store
 A store-within-a-store, is an agreement in which a retailer rents a
part of the retail space to be used by a different company to run
another, independent shop.
 Indicators of Sales Effectiveness

 Number of people passing by location

 Percentage who enter store
 Percentage of those who enter who also buy
 Average amount spent per sale
 Wholesaling

 Selling of goods in large quantities at low prices.

  In general, it is the sale of goods to anyone other than a standard consumer.
 Wholesaling is defined as a set of activities that are carried out to sell goods to
reselling business or entity.
Wholesaling
 Wholesaling Functions

 Selling and promoting  Transportation

 Buying and assortment  Financing
building  Risk bearing
 Bulk breaking  Market information
 Warehousing
 Major Wholesaler Types

 Merchant
 These are the most common type of wholesalers found in FMCG
and agriculture industry.
 They buy directly from the manufacturer, store the product and then
sell it to the customer.
 Full service
 They are most commonly observed in Consumer Durables or
Engineering products.
 As the name suggest, they give full service to the end retailer.
 Limited service
 A limited service wholesaler is someone who stocks the products of
the company and sells it in a limited channel.
 He does not have a large turnover or does not cover all channels of
the company.
 Brokers and Agents
 Most commonly observed in the real estate industry or in the
chemical markets.
 A broker assumes no risk. He has the producer or the manufacturer
on one side and he has the buyer on the other side.
 The work of the broker is to get the deal done and he gets a
commission on the deal.
 Specialised Wholesaler
 These are wholesalers who do wholesale of specialized items only.
 Example: A used car wholesaler who sells directly to customers or
to other used car dealers He is specialized in used cars and knows
the ins and outs of selling a used car to consumers.
 Wholesalers’ Marketing Decisions

 Target market
 Product assortment
 Price
 Promotion
 Place
LOGISTICS
Topics

 Definition & Origin of logistics

 Role of logistics in an organization
 Planning and Decision Making
 Distribution Network
 Warehousing
 Transportation (Sea , Land, Rail , Air)
 Basic Concept and Origin

• The term logistics is attested in English from 1846

and is from French : Logistique.

• It was popularized by military officer and writer

Antoine-Henri Jomini.

• It means the art of managing the flow of raw

material and finished goods from source to user.
Role of Logistics in an Organization

 Logistics in an organization are considered as a continuation of

marketing.
 It focuses on core (direct delivery , operations) and support
(technology, infrastructure) activities.
 It plays a critical role in each of the three critical elements of
marketing concept.
Customer Satisfaction

Integrated Effort Corporate Profit

Planning

 It’s the process that creates value by timing and positioning.

 Logistics planning serves to link and synchronize the overall firm’s

management integrated through a facility network.

 It’s combination of inventory, transportation, warehousing, material

handling and packaging.

 It’s subdivided into 3 strategies Location, Transportation, Inventory.

Planning Triangle

Transport Strategy
Inventory Strategy 1. Modes of transport
1.Inventory Levels 2. Scheduling
2. Deployment of 3.Shipment Size
inventories Customer
3. Control Methods
Service
Goals

Location Strategy
1. Location of facilities
2.Assignment of stock to source points
3.Private/Public Warehousing
Decision Making

Q. How should orders be handled ?

A. “Order processing"
Q. Where should stock be located ?
B. “Warehousing” 
Q. How much stock should be held?
C. “Inventory” 
 Decision Making

Q. How should goods be shipped?

A. Transport.
Distribution Network

Physical Distribution
 A distribution network is an interconnected group of storage facilities
and transportation systems
 It receive inventories of goods and then deliver them to customers. 
Outsourcing
 Logistics outsourcing is defined as engaging a logistic service provider
to carry out and manage your company’s logistics requirements. 
 It do not have the managerial authority within the marketing channel.
Objectives of Distribution

Meeting standards of Reducing distribution Reducing Completion

customer service cost Time

• Timeliness • Warehousing cost • Faster processing

• Accuracy against inventory for increased
• Material cost v/s customer service
Transportation
• Distribution cost v/s
customer service
standards
Functions of Distribution
Functions

Inventory Materials
Order Processing Warehousing Transportation
Management Handling
• Picking • Develop and • Unit Loading • Private • Intermodal
• Sorting Maintain • Containerization • Public Transportation
products • Distribution • Freight
• Just-in-Time Centre Forwarders
• Mega Carriers
Order Processing

It’s a sequential process involving :-

 Picking-consists in taking and collecting articles in a specified

quantity before shipment to satisfy customers' orders.

 Sorting- process that separates items according to destination.

 Consolidation-gathering packages into loading units for

transportation, control and bill of lading.
Inventory Management
 It refers to the process of ordering, storing and using a company’s
inventory
 It include the management of raw materials, components and
finished products
 It’s objective is to minimize inventory costs yet to have on sufficient
supply of goods.
 Just in Time (JIT) also known as Toyota Production System (TPS).
 It’s primary objective aimed at reducing times from suppliers to
customers.
  The physical handling of products in
warehousing operations and the
transportation.
Materials Handling  From points of production to points of
consumption
 Unit loading combines individual items
placed on pallets and handled by pallet jack
or forklift truck.
 Containerization is the use of standardized
shipping containers to facilitate transfer
with efficiency and security.
Warehousing

 It’s the act of storing goods where raw materials or manufactured

goods are stored prior to their sale.

 It creates time utility by bridging the gap between production and

consumption.
Functions
• Receiving
• Identifying
• Sorting
• Storage
• Holding
• Recalling
• Assembly
• Dispatching (Shipments)
Types of Warehouses

 Private warehouse:- It’s

company operated warehouses
for storing and shipping
products.

 Public Warehouses:-These
warehouses are a specialized
business establishment that
provide storage facilities to the
general public for a certain
charge.
Types of Warehouses

Distribution Centers
 A building used to receive and
temporarily store goods that will
be shipped to various destination
points.
 Massive retail chains own and
operate their own distribution
centers.
 A distribution center are package
handling center, warehouse or
fulfillment center.
Transportations

 Transportation is moving things from one place to another place

Five mode of Transportation-
 Roadways- A road is an identifiable route way or path between two
or more places. Various methods like buses , auto , trucks , cargos.
Transportations

 Railways-Rail transport is also known as train transport. It is a

means of transport, on vehicles which run on tracks (rails or
railroads).
 Rail transport is an enabler of economic progress, used to mobilize
goods as well as people.
Transportations

 Airways:-The movement of passengers and cargo by aircraft such as

airplanes and helicopters.
 In India its underdeveloped and underutilized and acts as a feeder or
supporting transport means.
Transportations

 Waterways:-Water transport is the process of moving people,

goods, etc. by barge, boat, ship or sailboat over a sea, ocean, lake,
canal, river, etc.

This Photo by Unknown Author is licensed under CC BY-NC-ND

This Photo by Unknown Author is licensed under CC BY-SA
Transportations

 Pipelines:- Pipe-lines are the specialized means of transportation

designed to move the items like crude-oil, petroleum, chemicals and
gas.
Coordinating Transportations

 Intermodal transportations is the movement of cargo from origin to destination by

several modes of transport in combination.
Coordinating Transportations
 Freight forwarders play a vital role in the movement of goods
from one place to another. Act as essential go-betweens in the
import/export process and provide assistance to individuals,
commercial organizations
 Mega carriers:-A freight transport company offering many shipment
methods, such as rail, truck, and air service.
Coordinating Transportations