This document provides an overview of Chapter 13 which covers retailing and wholesaling. It discusses the key concepts around retailing including types of retailers based on organizational approach, services offered, and product lines. It also summarizes the major decisions retailers must make around marketing, pricing, promotion, and store placement. For wholesaling, the document outlines the main functions wholesalers provide and types of wholesalers. It concludes with some of the challenges and trends impacting wholesaling.

1. Chapter 13- slide 1
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Chapter Thirteen
Retailing and Wholesaling

2. Chapter 13- slide 2
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Retailing and Wholesaling
• Retailing
• Retailer Marketing Decisions
• The Future of Retailing
• Wholesaling
Topic Outline

3. Chapter 13- slide 3
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Retailing includes all the activities in selling
products or services directly to final
consumers for their personal, non-business
use
Retailers are businesses whose sales come
primarily from retailing
Retailing

4. Chapter 13- slide 4
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Retailing
Amount of service
• Self-service
• Limited service
• Full service
Types of Retailers

5. Chapter 13- slide 5
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Retailing
Product Line

6. Chapter 13- slide 6
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Retailing
Types of Retailers
Relative Prices

7. Chapter 13- slide 7
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Retailing
Types of Retailers
Organizational Approach

8. Chapter 13- slide 8
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Retailing
Corporate chains are two or more outlets that
are commonly owned and controlled
• Size allows them to buy in large quantities at
lower prices and gain promotional
economies
– Sears
– CVS
Types of Retailers
Organizational Approach

9. Chapter 13- slide 9
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Retailing
Voluntary chains are wholesale-sponsored
groups of independent retailers that engage
in group buying and common merchandising
• IGA
• Western Auto
Types of Retailers
Organizational Approach

10. Chapter 13- slide 10
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Retailing
Retailer cooperatives is a group of
independent retailers that band together to
set up a joint-owned, central wholesale
operation and conduct joint merchandising
and promotion effort
• Ace Hardware
• Associated Grocers
Types of Retailers
Organizational Approach

11. Chapter 13- slide 11
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Retailing
Franchise organizations are based on
some unique product or service; on a
method of doing business; or on the
trade name, good will, or patent that the
franchisor has developed
• Holiday Inn
Types of Retailers
Organizational Approach

12. Chapter 13- slide 12
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Retailing
• Merchandising conglomerates are
corporations that combine several
retailing forms under central ownership
• Limited Brands
Types of Retailers
Organizational Approach

13. Chapter 13- slide 13
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Retailing
Segmentation, targeting, differentiation, and
positioning involves the definition and
profile of the market so the other retail
marketing decisions can be made
Retailer Marketing Decisions

14. Chapter 13- slide 14
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Retailing
Product assortment and service decisions
include:
• Product assortment
• Services mix
• Store atmosphere
Retailer Marketing Decisions
Product Assortment and Service

15. Chapter 13- slide 15
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Retailing
Price policy must fit the target market and
positioning, product and service assortment,
and competition
• High markup on lower volume
• Low markup on higher volume
Retailer Marketing Decisions
Price Decision

16. Chapter 13- slide 16
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Retailing
High-low pricing involves charging higher
prices on an everyday basis, coupled with
frequent sales and other price promotions
Everyday low price (EDLP) involves charging
constant, everyday low prices with few sales
or discounts
Retailer Marketing Decisions
Price Decision

17. Chapter 13- slide 17
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Retailing
Retailer Marketing Decisions
Promotion Decision

18. Chapter 13- slide 18
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Retailing
Central business districts are located in cities and
include department and specialty stores, banks, and
movie theaters
Shopping center is a group of retail businesses
planned, developed, owned, and managed as a unit
• Regional shopping centers
• Community shopping centers
• Neighborhood shopping centers
• Power center
• Lifestyle centers
Retailer Marketing Decisions
Place Decision

19. Chapter 13- slide 19
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Retailing
Retailers have to choose target segments carefully,
position themselves strongly, and consider the
following developments as they plan and execute
their competitive strategies
• Non-store retailing
• Retail convergence
• Megaretailers
• Retail technology
• Global expansion
• Retail stores as communities
The Future of Retailing

20. Chapter 13- slide 20
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Retailing
Wheel-of-retailing concept states that many
new types of retailing forms begin as low-
margin, low-price, low-status operations,
and challenge established retailers. As they
succeed they upgrade their facilities and
offer more services, increasing their costs
and forcing them to increase prices,
eventually becoming the retailers they
replaced.
The Future of Retailing
New Retail Forms and Shortening Retail Life Cycles

21. Chapter 13- slide 21
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Retailing
Growth of non-store retailing includes:
• Mail order
• Television
• Phone
• Online
The Future of Retailing
New Retail Forms and Shortening Retail Life
Cycles

22. Chapter 13- slide 22
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Retailing
Retail convergence involves the merging of
consumers, producers, prices, and retailers,
creating greater competition for retailers and
greater difficulty differentiating offerings
The Future of Retailing
New Retail Forms and Shortening Retail Life
Cycles

23. Chapter 13- slide 23
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Retailing
The rise of megaretailers involves the rise of
mass merchandisers and specialty
superstores, the formation of vertical
marketing systems, and a rash of retail
mergers and acquisitions
• Superior information systems
• Buying power
• Large selection
The Future of Retailing
New Retail Forms and Shortening Retail Life
Cycles

24. Chapter 13- slide 24
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Retailing
Growing importance of retail technology
provides better forecasts, inventory control,
electronic ordering, transfer of information,
scanning, online transaction processing,
improved merchandise handling systems,
and the ability to connect with customers
The Future of Retailing
New Retail Forms and Shortening Retail Life
Cycles

25. Chapter 13- slide 25
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Wholesaling
Wholesaling includes all activities involved in selling goods
and services to those buying for resale or business use

26. Chapter 13- slide 26
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Wholesaling
Selling and promoting involves the
wholesaler’s sales force helping the
manufacturer reach many smaller
customers at lower cost
Buying assortment building involves the
selection of items and building of
assortments needed by their customers,
saving the customers work
Wholesaling

27. Chapter 13- slide 27
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Wholesaling
Bulk breaking involves the wholesaler buying
in larger quantity and breaking into smaller
lots for its customers
Warehousing involves the wholesaler holding
inventory, reducing its customers’ inventory
cost and risk
Wholesaling

28. Chapter 13- slide 28
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Wholesaling
Transportation involves the wholesaler
providing quick delivery due to its proximity
to the buyer
Financing involves the wholesaler providing
credit and financing suppliers by ordering
earlier and paying on time
Wholesaling

29. Chapter 13- slide 29
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Wholesaling
Risk bearing involves the wholesaler absorbing
risk by taking title and bearing the cost of
theft, damage, spoilage, and obsolescence
Market information involves the wholesaler
providing information to suppliers and
customers about competitors, new products,
and price developments
Wholesaling

30. Chapter 13- slide 30
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Wholesaling
Management services and advice involves
wholesalers helping retailers train their sales
clerks, improve store layouts, and set up
accounting and inventory control systems
Wholesaling

31. Chapter 13- slide 31
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Wholesaling
Types of Wholesalers

32. Chapter 13- slide 32
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Wholesaling
Merchant wholesalers is the largest
group of wholesalers and include:
• Full-service wholesalers who provide a
full set of services
• Limited service wholesalers who
provide few services and specialized
functions
Types of Wholesalers

33. Chapter 13- slide 33
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Wholesaling
Brokers and agents do not take title, perform a
few functions, and specialize by product line
or customer type
• Brokers bring buyers and sellers together
and assist in negotiations
• Agents represent buyers or sellers
Types of Wholesalers

34. Chapter 13- slide 34
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Wholesaling
Manufacturers’ sales branches and offices is
a form of wholesaling by sellers or buyers
themselves rather than through independent
wholesalers
Types of Wholesalers

35. Chapter 13- slide 35
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Wholesaling
Target market and positioning decisions
• Size of customer
• Type of customer
• Need for service
Wholesaler Marketing Decisions

36. Chapter 13- slide 36
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Wholesaling
Marketing mix decisions
• Product
• Price
• Promotion
• Place
Wholesaler Marketing Decisions

37. Chapter 13- slide 37
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Wholesaling
Challenges
• Resistance to price increases
• Lack of suppliers
• Changing customer needs
• Adding value by increasing efficiency and
effectiveness
Trends in Wholesaling