Retail is the general process of selling consumer products or services directly to consumers through various channels of distribution in order to make a profit. Retailers meet demand identified by a supply chain. The distribution chain includes retail stores, distributors, merchandisers, suppliers and others who play a role in making the distribution process. A retailer can focus on one or more distribution channels to maximize sales.

The products supplied by a distributor are normally sold to retail shop customers directly, through a distribution system or through the internet. The system used by the retail shop to identify the customer needs and to provide products ranges usually starts with the sales team. A retail shop manager identifies the need for the products and develops a sales strategy to meet these needs by satisfying various customer groups. Developing and monitoring a retail shop's marketing plan involves defining goals, establishing methods to measure progress, identifying appropriate channels and defining benchmarks for performance.

 

Distribution systems include truck loading and off-loading, Single-track and multi-track systems, refrigerated and non-refrigerated channels, direct sales and replenishment. The various distribution methods involve varying levels of automation based upon the volume of product distributed. Measurement methods include productivity, efficiency, stock levels and returns. Defining benchmarks for performance often involves evaluating against a defined scale, typically against sales volume. Developing a marketing plan involves setting benchmarks, determining prices, attracting new customers and maintaining customer loyalty. Building and maintaining relationships with suppliers enhances the retail shop's quality control processes and reduces distribution costs.

 

An online retail shop differs from a traditional retail shop because it does not have physical premises. An online retail shop operates from a remote site accessed by its customers through the Internet. Online retail shops need to attract and retain customers to remain in business. Marketing strategies include advertising, promotion and creating an online presence. A website helps attract customers by providing information about the products and services, providing descriptions, pricing and discounts, and creating a catalog.

 

In a retail shop, floor space is not wasted because products are displayed on racks and shelves. Large retail shops may also feature a cashier system to accept payments and issue receipts. Customers can browse by categories to locate products easily and quickly. When customers find something they want, they can make a purchase just by clicking on the online link of the product. Some websites allow customers to place "wish lists" for future purchases.

 

A retail shop needs a sound plan in order to be successful. The strategic goals of the retail shop must be carefully defined and a detailed plan must be developed and implemented. The goals can include increasing sales, reducing inventory, increasing profits and reducing waste or excess inventory. The management software used to help develop the plan will generate reports that include monthly sales and profit margin, average order size, average shipping time, and profit margins. Software programs can also be customized to meet the specific requirements of each retail shop.