The Three Keys to Success in Retailing Are: Location, Location - Essay Example

"The Three Keys to Success in Retailing Are: Location, Location" and Section # of "Introduction" 'Beginnings of Retail Trade Early Trade Cultivation and harvesting of land became the foundation. There would be an intermittently excess of goods. When the needs of his family and community were met, he would then take an attempt to trade his goods for other varying goods that were being produced somewhere else .Thus the markets were formed then. These early on efforts to exchange goods urbanized into more proper gatherings. Whenever a producer who would face a surplus of his goods would not be able to find another producer in order to make exchange , he then may have permitted other's to owe him those goods .this was how early credit terms developed . This eventually led to symbolic representation, of these debts in the form of precious items like gemstones etc. and eventually the instrument 'Money' developed and is being exchanged. Ultimately, markets developed and shops became a permanent part of these markets. This was where the retail trade initiated. How Retail Developed Retail trade in actual is embedded in two significant groups the Peddlers and the Producers. The peddlers would purchase the commodities they thought would sell in the market for a profit and the producers on the other hand were more interested in selling only the goods they were producing . General Store This trend continues even today, with certain specific shops specializing in certain specific areas, these actually reflect their origins, as in a broad mix of producers. Such as a general store. Such as Casey's in the mid west of U.S.A .the general store has taken over the establishments of specialist shops. The customer's find this more convenient o visit, than to visit four different shops for their choice of goods. The term Convenience stores are also used for such stores. These have further developed into Super markets or super stores'1. History of Woolworth 'It was Frank Woolworth who initiated his retail business also his career in 1873. He worked as a sales assistant in the Augusbury and Moore Dry goods store in Water Town New York. William Moore the co owner took pity on this young boy and accepted his plea of a three month free work trial at the store. The country (America) was still recuperating since after the civil war and the cash was surely tight. A brainwave occurred to Moore; he wanted to display all his surplus stock at a fixed price of 5 cents per piece. He then asked Frank to arrange for it. Back in 1877 this fixed price strategy for one whole day was quite new, and not a routine concept like today. In those days, the prices never used to be displayed along with the products instead the customers had to always ask the assistant for the prices. These prices in those times used to vary from individual buyer to another individual buyer majorly depending upon how they looked! An amazingly attractive display was setup by Frank, he used a red colored material and it had Gold lettering over it , this boosted sales and also developed a lot many peoples interest . Frank truly believed that a whole big Store could be filled up with five cent goods rather than just one single counter. And, so in 1879, he somehow was able to persuade Mr. William Moore to support him in the opening of a store of his own. He failed in his first attempt, which was at Utica in New York. His store was popular initially but gradually the sales declined. But at his first attempt frank had made enough money to clear all his debts and also along with all this he learnt a very valuable lesson , that he had to really make sure that his store should have been located at the heart of the town instead of some side street area . He gave it another try and this time around he, opened in Lancaster Pennsylvania, about 60 miles away. Franks' store opened on June 21st, 1879. It was a huge success from the start, taking $127.65 on its first day. Woolworth's Success Someone once asked Frank Woolworth how he would explain the success of the business in those early days. He said "I put it down to the great buying power that allows us to drive prices lower by helping factories to make their goods more cheaply. And to making sure that everyone - rich or poor - is welcomed in and treated with the same respect." The philosophy has served us well for 125 years'2 History and background of Harrods's 'Harrods based in London, is a departmental store which is very renowned. it is actually located at Brompton Road , which is South of Hyde Park . It was Henry Charles Harrod who was the founder of Harrods; it initially was a grocery store in 1849. The expansion took place in the 1800's the customer service department was expanded to be able to provide for each and every need that the consumer might have. Using the store's services, customers could buy theatre tickets, make travel reservations, and arrange funerals. Though, it was founded, as a grocery store in 1849. The store extended in the late 1800s, and many new departments were added. Though Harrods still sells gourmet food, it now emphasizes fashionable clothing. Known for its zealous customer service, it is considered the best department store in Britain. In 1985 it was bought by Mohammed al-Fayed (born 1933)'.3 Retailing success: Marketing books are filled with statements, and theories explaining the fact how consumers are King, how they are the focal point to every business. The same cannot be denied for the business of retailing, but yet again as in other cases there are various other factors that can make a retail business produce profits or make losses. Location tends to be on the top of the list. There is no doubt about the fact, that if your store is not located in the heart of the town, or city. The decline in sales or profits can be related to it. 'What the World's Best Retailers Do to Survive The retailers in their business have got to put their concentration towards eight retail Priorities. In Order to survive in severe economic complexities says Phil Kowalczyk, Managing Director, and North America for Kurt Salmon Associates (KSA). "Successful retailers know they must consistently focus on developing winning value propositions based on the core principles of value, innovation, and convenience -- in good economic times or bad," Kowalczyk says. Consumer being the top priority, the price, the brand strategy, the customer service, the international expansion, and the continuous innovation is critical. Also creating a sound financial foundation through the network of Supply chain Efficiency. The consumer is the top priority; price, brand strategy, customer service, and innovation are critical; and global expansion and establishing a strong financial foundation through supply chain efficiency encompass the list. Kowalczyk says, Flawless implementation of these elements on the store floor , compel the customers to spend with reason . "Surviving in the Shadow of the Bear: Successful Retail Strategies for Challenging Times, "publication released by KSA -- the international management consulting firm specializing in the retail and consumer products industries -- explores how some of the world's best retailers develop the strategy and vision to forge ahead in the face of increasing competition to succeed even in difficult economic times. Based on an executive panel discussion moderated by Kowalczyk at the 2003 National Retail Federation (NRF) Convention and Expo in New York City, this publication asserts that for many retailers, the key to success in a down economy is first to achieve and maintain financial stability, and then to evaluate low-risk growth options in which to invest. Winners will make smart investments in pricing strategies, brand(s), service, product innovation, and global expansion. The stories of panelists Mark Friedman, first vice president of Merrill Lynch & Co.; Marty Hanaka, chairman and chief executive officer of The Sports Authority; John Hancock, chief executive of MFI Furniture Group PLC; and Dr. Hans-Joachim Korber, chief executive officer of METRO AG epitomize these key concepts, and the benefits of executing them decisively to provide solutions that exceed consumers' expectations. "Surviving in the Shadow of the Bear: Successful Retail Strategies for Challenging Times" is available for download from KSA's Web site publications library.'4 The administration and management at Harrods's and Woolworth seem to be following the following path: 'The consumers are seen to go out of their way to shop at power retailer shops because of the sole reason that they would be able to find and purchase what they want to with minimum hassle. Charles Lazarus of Toys "R" Us and Leslie H. Wexner of the Limited, Inc., have actually revealed that power retailing works, and it works in forte formats. Sam M. Walton applied this to his Wal-Mart discount stores. And David C. Farrell of May showed that power retailing can bring a new nimbleness to the clay-footed giants of retailing -- old-line department stores." One issue to ponder on is what these retailers have in common to answer this the companies should be able to identify customer needs and pay constant attention to the marketplace . They should place orders real early and the quantity, sizing power, assortment. These are what dominate competitors; and use modern computer and inventory-control systems. Major weakness of the power retailing among chain retailers is that management policies are too often standardized and centralized. There are three key doctrines's that each and every retailer, besides of size or line of business, could learn from the concept of power retailing: One, there must always be a "game plan" for the firm that is outlined in advance. Two, the retailer's focus must always be on consumers and how to best satisfy them. Three, to be most ef- fective in the marketplace, a firm needs to be dominant in at least one aspect of its strategy. In the broadest sense, power could result from having the longest store hours, the best delivery policy, and so on. As a result, a small firm could be a power retailer by serving an unfulfilled consumer need. At the same time, every retailer must also recognize consumers' minimum expectations for each element of its strategy (such as the store hours, product assortment, and customer services). Working women expect stores to have evening hours; this is a minimum requirement. Even if a firm dominates in other areas of its strategy, it must still satisfy the minimum standards set by consumers. Here are six very different ways for a firm to act as a power retailer. Two or more of the approaches could be combined to yield greater power: 1. Be price oriented and cost efficient to appeal to price-sensitive shoppers. 2. be chic to appeal to full-service, status-conscious consumers. 3. Be convenience oriented to appeal to consumers interested in shopping ease, nearby locations, or long store hours. 4. Offer a dominant assortment with an extensive selection in the product lines carried to appeal to consumers interested in variety and in-store shopping comparisons. 5. Be customer service-oriented to appeal to people who are frustrated by the decline in retail service -- as they perceive it. 6. Be innovative or exclusive and provide a unique method of operations (such as kiosks at shopping centers) or carry products/brands/services not stocked by other stores to appeal to customers who are innovators, bored, or looking for items not in the me-too mold. Retailers will almost certainly not be able to accomplish something in the long-run if they are mid-level in all of the six areas just recognized; they must do a greater job in at least one area. The amount of antagonism will be too severe for them to do otherwise. It should also be kept in mind that a price-oriented strategy may be the easiest for competitors to duplicate, at least in the short-run, and that price-sensitive shoppers often have little store loyalty'.5 "Conclusion " The concept of retailing is not new to anybody. Infact it has been around now for a century and more. It still exists as one of the most successful forms of business, in which the producers also get their fair share of the hard work they have put in. Departmental and retail outlets like Harrods and Woolworth's have been successful all these years because of the fact that they did give the due importance to Location while deciding where and when to open their branch stores. Proper consumer market research needs to be carried out in order to decide and then open branches. These help target the consumers in the best possible manner. But along with giving importance to location, these companies have not ignored the other factors that really need to be considered while opening up of branch stores. Like pricing, discounts, variety, brands etc. The retailers in the business also need to keep a sharp eye on their competitors and how they can create their own niche. Appropriate marketing strategies also are vital. Bibliography 1. http://www.aboutretail.ne ...s_of_retail_trade.htm , http://www.retailtip.com/retailtrade/ 2. The U.S origin of Woolworth's, http://museum.woolworths.co.uk/1800s-earlyhistory.htm. 3. Harrods. (2007). In Encyclopdia Britannica. Retrieved November 16, 2007, from Britannica Concise Encyclopedia http://concise.britannica.com/ebc/article-9366654/Harrods. 4. From Kurt Salmon Associates Successful Retail Strategies for a Difficult Economy http://retailindustry.about.com/cs/business/a/bl_ksa050603.htm. 5. by Joel R. Evans, Ph.D. & Barry Berman, Ph.D. Power Retailing: Not Just for Large Firms Tips for Better Retailing, http://retailindustry.about.com/library/uc/be/uc_be_power.htm. Read More