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Types of Retailers

Types of Retailers

There are 7 main types of retailers which can be defined by the size of their business and the way they in which they sell their products.

The 7 main types of retailers are;

Department Store – This type of retailer is often the most complex offering a wide range of products and can appear as a collection of smaller retail stores managed by one company. The department store retailers offer products at various pricing levels. This type of retailer adds high levels of customer service by adding convenience enabling a large variety of products to be purchased from one retailer.

Supermarkets – Generally this type of retailer concentrates in supplying a range of food and beverage products. However many have now diversified and supply products from the home, fashion and electrical products markets too. Supermarkets have significant buying power and therefore often retail goods at low prices.

Warehouse retailers – This type of retailer is usually situated in retail or Business Park and where premises rents are lower. This enables this type of retailer to stock, display and retail a large variety of good at very competitive prices.

Speciality Retailers – Specialising in specific industries or products, this type of retailer is able to offer the customer expert knowledge and a high level of service. They also add value by offering accessories and additional related products at the same outlet.

E-tailer – This type of retailer enables customers to shop on-line via the internet and buy products which are then delivered. This type of retailer is highly convenient and is able to supply a wider geographic customer base. E-tailers often have lower rent and overheads so offer very competitive pricing.

Convenience Retailer – Usually located in residential areas this type of retailer offers a limited range of products at premium prices due to the added value of convenience.

Discount Retailer – This type of retailer offers a variety of discounted products. They offer low prices on less fashionable branded products from a range of suppliers by reselling end of line and returned goods at discounted prices.

What makes a good retailer?

A good retailer can increase your sales by providing a way for customers to purchase products from suppliers without the need to buy in bulk or to contact the suppliers directly. They can also provide complimentary products from more than one supplier or wholesaler so the end user can have a choice of similar products supplied by different manufacturers. This provides choice for the customers and improves competition between the suppliers to provide the products at the best price affordable to the buyer and to their specifications.

Diversity and variety of products can be provided by a good retailer who can sell products from multiple suppliers. Finding a good retailer adds value for the customer who can make comparisons between complimentary or alternative products available.

Good retailers may be offered exclusivity with a supplier to ensure that competitors’ products are not sold alongside your products in the same category. A good retailer can provide brand identity for ranges of products enhancing reputations and loyalty for the consumers. Retailers can also provide the point of physical contact for the consumers to see and assess the products in reality. A good retailer will introduce new products their buyers may otherwise be unaware of and can therefore stimulate extra sales.

The Benefits of Using a Retailer

The benefits of using a retailer include providing additional value to the customers in the form of product and service mixes to entice the customer to buy from them rather than the individual supplier. The retailer provides the channel between the end user and the designers and manufacturers of the products.

The retailer is able to sell products for which they see a demand and for which they they have an interest in and may get the support and information required to convince the buyers from the suppliers. The retailer can choose a supplier that can supply the products at the cost level on which they can make a profit after including direct and indirect costs. Suppliers benefit by using retailers who can add value for the customers in terms of quality and service, encouraging either repeat sales of the product or diversity of products.

The retailer is in a position to either continue to buy from their existing suppliers or may change to new ones offering new or unique items the consumer may be interested in. New retailers can be found who could add your products to their business, increasing the sales of your products to new customers.

With the globalisation of sourcing products, the benefits of using retailers allow new suppliers to deliver their products to new customers worldwide.

How to increase revenue streams

The retailer must chose suppliers who can provide products required by their customers. The retailer must have a clear idea of the target market for the suppliers products and must be able to increase the value of the products with the services they offer.

The placement of products in the correct type of retailer will enable the product to be found and seen by the right customers.

Ensure that the retailers selected provide the correct image identity for your product and the level of service needed.

The retailer can increase their sales by remaining competitive in their pricing strategy according to supply and demand. They can also increase revenue by sourcing the most cost effective suppliers or wholesalers.

The retailer must remain up to date with new suppliers and products as yesterdays must haves will not be what the consumers want today.

The suppliers must ensure that new technology, production methods and sources are incorporated into their products or they will not get the level of sales if developments leave them with an out dated product that retailers can’t sell.

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