Retail vs Wholesale
Retail involves selling goods or services directly to consumers in small quantities, often through physical or online stores. Wholesale, on the other hand, involves selling goods in large quantities to retailers or businesses, typically at a lower price per unit. Retailers cater to individual consumers, while wholesalers cater to businesses looking to resell the products.
5 Key excerpts on "Retail vs Wholesale"
eBook - ePubSales and Marketing Channels
How to Build and Manage Distribution Strategy
- Julian Dent, Michael White(Authors)
- 2018(Publication Date)
- Kogan Page(Publisher)
...22 Insights from managing consumer goods distribution and retailers Retailers and retailing What distinguishes retailers from all other types of final-tier players? The generally accepted definition of retailing is that it consists of selling products and services to the ultimate consumer for private consumption. By and large that’s whom retailers sell to, though not exclusively, as small business will also often use retailers for convenience (and sometimes for price). You will have noticed that the definition makes no mention of shops or stores. Retailers today go to market through many selling portals, including stores, catalogues, mail-order, the web and telesales. In some cases, players who started out as web-based only, such as Amazon, have opted to introduce stores into their channel mix. There is a general consensus that the long-term survivors in this sector will need to adopt an ‘omni-channel’ approach. In consumer goods distribution, the goal of the retailer, whether physical, virtual or both, is to attract customers to its store, get them to ‘shop’ the store, get them to buy the best ‘mix’ (ie the most profitable lines) in the store and to get them to come back again. This very simple model (see Figure 22.1) underpins all the businesses in this sector, but the way it changes by channel provides insight into some of the pressures being faced by some major players. Figure 22.1 Fundamental retail business model Fundamental retail business model Store-based channels It is easiest to start with the store-based retail selling motion, ie selling through physical retail premises, located in places that are convenient for the target customer...
eBook - ePubManaging the Retail Supply Chain
Merchandising Strategies that Increase Sales and Improve Profitability
- James Topps, Glenn Taylor(Authors)
- 2018(Publication Date)
- Kogan Page(Publisher)
...02 Foundations of retail and supply chain and merchandising Retail basics This book focuses on supply chain and merchandising in the retail industry. The skills and requirements for supply chain professionals within retail are different to supply chain professionals in non-retail businesses. Merchandising doesn’t even exist outside of retail, so it’s important to understand the retail industry and how supply chain and merchandising fits into that industry. Retail is easy to understand, it’s an industry of business that the general public have a connection to and interact with on a daily basis. News relating to retail business will make national headlines, people are interested and invested in the industry. This makes retail a dynamic, pressurized and transient sector to work in. This chapter will briefly outline what retail is, and how a retail business is typically structured. It will also give a brief history of retail and outline the commercial function that supply chain and merchandising sits within. What is retail? ‘Shopping’, the purchasing of goods from a shop or online shop (Timothy, 2005). Every single adult (and the majority of children) in the developed world will have purchased something from a shop. Retail is a world that we all interact with on a regular basis. We all have a vested interest in what is happening on our high streets. Retailers, more than any other business or industry, make mainstream news, for good and bad reasons. We are emotionally attached to the brands and shops we use every day. Customer loyalty may not be as strong as it used to be, but it’s still a key factor in the customer’s buying decision. The dictionary definition for retail is ‘The sale of goods to the public in relatively small quantities for use or consumption rather than for resale’ (Oxford Dictionaries, 2017). In simple terms this is what retail is – selling goods to a customer to consume...
eBook - ePubFood Supply Chain Management
Building a Sustainable Future
- Madeleine Pullman, Zhaohui Wu(Authors)
- 2021(Publication Date)
- Routledge(Publisher)
...The entrance is placed on the right and customers follow a counterclockwise pattern in the store as this flow has been shown to generate more sales. Distribution, Wholesaling & Inventory Management Depending on their scale, food retailers may or may not own their own distribution center. If they do, these centers receive and redistribute merchandise, usually to stores within 250 miles of their hubs. For example, Kroger is one of the largest US food retailers, but it is also one of the largest food distributors. It runs its own bakeries and dairies and leverages its distribution hubs to supply all of the grocery stores it owns and operates—a number of chains with different names across the country. The largest chains leverage their distribution systems to increase revenue by providing replenishment services for other grocers. Wholesaling The grocery industry has three kinds of wholesalers: Merchant wholesalers, manufacturers’ sales branches and offices (MSBO) and brokers or agents. Merchant wholesalers buy products from manufacturers or processors and resell these products to the retail businesses. Like food service, merchant wholesalers can be broadline distributors, specialty distributors who deal in dairy, frozen foods or produce and miscellaneous distributors for items such as coffee, drinks or bread. MSBOs are company owned operations that market their own products. And finally brokers or agents are representatives for others and do not own or handle the product. They buy or sell on commission. Inventory & Information Management The retail supply chain fundamentally consists of inventory selection, wholesale buying, logistics (shipping, handling and stocking), marketing and retail pricing. Inventory management influences all of these supply chain elements and is of primary importance in the retail industry. There are three general components of inventory management: assortment, allocation and replenishment...
- Bonita Kolb(Author)
- 2020(Publication Date)
- Routledge(Publisher)
...However, at some point in time, the company may start thinking why not more? Multiunit retail selling is entering the distribution big league. With a single retailer, a personal sales approach can be used, but getting a retail chain to distribute your product is a more complicated process: Ask yourself: Can you produce the necessary volume? If you cannot do so, then stop now. Rethink pricing: Now not only do both you and the retailer need to make a profit, if a wholesaler is involved, they must also. Fill out the application: Large retailers will require an application that will also specify requirements such as manufacturing capability, labor standards, and insurance requirements. Make the pitch: Many companies will pay a commission to a broker familiar with wholesale distribution to pitch their product. However, if you do get a chance to make a presentation to a buyer for a retail chain, here is what they will also want to see: Product and package sample; Product brochure and price list; List of retailers currently carrying the product; and Promotion plans and samples. Getting into the big leagues of multi-retail distribution can result in a significant increase in revenue. However, it will also add to the complexity of managing the business. Larson 2015 QUESTION TO CONSIDER: Are we ready for distribution through multiple retail store distribution? Why or why not? A small creative company may initially sell their product directly to consumers. They may then set up an e-commerce site and sell online. As the company grows they may decide that they need to sell through retail stores in order to reach more potential consumers (Terlep 2019). When the product is sold through a retail intermediary any customer who comes to the store will see the product on the shelf...
eBook - ePubStore Wars
The Worldwide Battle for Mindspace and Shelfspace, Online and In-store
- Greg Thain, John Bradley(Authors)
- 2012(Publication Date)
- Wiley(Publisher)
...Manufacturers create perceptual maps of brands that suggest how their brand should be positioned to gain users, whereas stores are positioned on a real map. Whatever shopper segments a chain would like to choose, it has to serve the shoppers who live or work nearby. Hence, any one chain is unlikely to find a homogeneous socio-economic or lifestyle sub-group across all its stores. Since a retail chain is the sum of its individual stores, every retailer serves, to varying degrees, all groups: those customers who find it convenient, i.e. those living nearby or for whom the store is on a route customers who are attracted by the price policy, be it every day low price (EDLP), high-low or premium customers driven by special offers/promotions customers attracted by a specific, SKU, service or facility, e.g. fresh bread, meat, fish. Retailers do not sit side by side on a shelf. They do not have an entire population from which to target their users; for their part, shoppers do not select stores from the complete range of retail chains on offer in the country. Key learnings Retailers and manufacturers have very different financial business models. These differences drive many of the contrasting perceptions and behaviours of the two parties and are at the root of much of the friction: they see and respond to the same events in very different ways. Relative to manufacturers, retailers have huge fixed costs and miniscule margins: this makes their profits more susceptible to small changes in volume and pricing, both favourably and unfavourably, than is the case with manufacturers. The price perception of a retail chain is a critical success factor, and one that they cannot be seen to get wrong...
