Time to Talk Retail
Retailing is one of the oldest businesses known to mankind, records show that retail markets have existed across the globe since ancient times with its history traced as far back as the invention of the barter systems (9000-600bc), evolving through the centuries and becoming a very important part of our lives.
What is Retail?
Retail can be defined as the art of selling goods or items to the people who will use them, and it involves the sale of merchandise from a single point of purchase directly to a customer who intends to use that product. A retail transaction is the end of a supply chain and it can actively take place through a number of different sales channels, might be online, in a brick-and-mortar storefront, via direct sales, or direct mail. The aspect of the sale that qualifies it as a retail transaction is that the end user is the buyer.
As I mentioned earlier, Retailers are the final link in the supply chain between the manufacturers and the consumers, they are the real customer-centric clan of the whole production business chain because they focus more on the customer leaving the manufacturers to focus more on the products.
What is it really about?
Retailing is about displaying products, describing the features and benefits of the products, stocking products, processing payments and doing whatever it takes to get the right products at the right price to the right customers at the right time. Sometimes it entails offering an additional service to the retail transaction, it can be personal shopping consultations, and gift wrapping to add something extra to the retail customer experience and exceed the retail customer experience.
Now there are different categories of retail stores ranging from Specialty stores to Discount stores to e-commerce stores but this post would be focusing more on the different types of online retail business owners and how it could be of benefit to you.
Deciding on the type of online retail business you want to start up, will depend on why you want to own the business. It might be based on your personality, lifestyle or what you're selling. Listed below are a few of the main types of retail ownership, the advantages, the disadvantages, and the support system of each.
Individual Owner
Under this structure, an individual or corporate entity owns and operates one or a very small number of outlets or single online store. From the business planning stage to opening day, the independent retail owner does it all. They may decide to hire consultants or specific staff but the bulk of the job rests solely on their shoulders
While the opportunities for choosing this model is endless, one must prepare to take on many challenges/ risks in this kind of business because it may be a while before your brand gets known and accepted by the customers but having a special niche of business backed up with a reliable platform might be the special trick to get you to your business destination.
Existing Businesses
This could either be by inheritance, merger or a business acquisition, taking over an existing business is another type of retail business ownership, the risk of starting up the business has been eliminated, but you might need a thorough internal and external performance audit in order to improve the business brand and acceptance amongst your existing and intended client base.
Franchising
Commonly referred to as contractual licensed channel arrangement, the arrangement often involves a legal agreement in which the owner of the retail concept allows the operator to run the owner’s business concept in exchange for financial considerations, such as a percentage of revenue, almost similar to existing businesses but in this case, you are buying the right to legally use the name, product, concept, and business plan of an established business, depending on the type of agreement involved, you might be expected to be in tune with the company’s core values as you will be representing the business core values in your stores but with this arrangement the customers get to accept your platform easily
Dealership
A licensed dealership is a mix of franchise and independent retailer, here the owner (Dealer) has a larger field of influence unlike the franchise arrangement, the dealer can sell a variety of brands and there are generally no fees to the licensor
Network Marketing
Popularly known as Multi-level marketing, in this model, the number of product sold is totally dependent on the number of people in your network, each member of the network is expected to sell products directly to end-user retail consumers by means of relationship referrals and word of mouth marketing. This model reduces the
Deciding on the type of online retail business you want to start up, will depend on why you want to own the business. It might be based on your personality, lifestyle or what you're selling but always remember, one of the major benefits of being an online retailer is the ability to offer shopping convenience to your visitors/customers by being open for business all day, every day. Putting your business online gives you the ability to offer a wide selection of product since all they really need in order to attract orders is a picture and description of the product. That is, they may not need to have the product on-hand the way physical stores do. Instead, you can reach out to a larger pool of customers, wait until an order is received from their customers before placing an order with your suppliers, cutting down significantly on the cost of maintaining an inventory of products. So if you want to start a retail business, yes there are a wide variety of options available. Each option coming with its own advantages, disadvantages, and style but having that technological advantage adopted in your business operations goes a long way in setting you apart from the crowd.
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