The size of the global retail market is expected to reach almost $28 trillion by 2022. The exponential growth of this sector is as a result of rising disposable incomes, positive changes in consumer preferences, and the increasing number of large retailers in the industry.
As the retail industry continues to expand, investors are constantly looking for new ways to attract more customers to their businesses. One effective way to do so is through the differentiation of offers.
Today, there are many different types of retail stores that aim to meet the needs of consumers based on their unique needs.
In this post, we’ll tell you what you need to know about retailing, and what types of retailers there are on the market. We’ll also give you a few retail store examples for each type of retailer.
Read on to learn more.
What Is Retailing?
Retailing refers to a distribution channel in which an entity buys products from a supplier or manufacturer and sells them directly to consumers. Retailing often involves breaking bulk, displaying, and sometimes delivery of the goods.
Retailing outlets take ownership of the goods before selling them. They, therefore, bear the risk associated with inventory.
Types of Retail Stores
The vast world of retail consists of many different types of stores that cater to consumers with varying needs and budgets. Here are the eight most prevalent types of retail stores:
Specialty Stores
Specialty stores have a narrow product line. Most focus on one or two specific categories of goods. The primary benefit of these stores is that they provide lots of different items related to the specialty they focus on that you can’t find in general stores.
An example of a specialty store is one that deals with sport’s items. In this store, you’re likely to find all kinds of sports equipment that you normally wouldn’t find on the open market.
Department Stores
A department store is usually located within a mall. Typically, these stores have lots of different products under their roof. These products may include men’s and women’s clothing, accessories, home furnishings, and so on.
Department stores usually feature separate sections for separate categories of products. The number of categories of goods sold in department stores, however, is not exhaustive. Generally, they limit these categories in some way.
How?
Well, most department stores don’t carry such FMCG items as shampoo and soap. Those that do only deal with a specific category of such goods. These stores target customers looking for specific products, such as mid to high-level jewelry or clothing.
Popular departmental stores include Macy’s, Pantaloons, and Shoppers Stop.
Supermarkets
Supermarkets are among the most well-known retail stores around the world. Generally, these retailers focus on the residential market and carry necessary and useful products. Such products include different food varieties, groceries, FMCG products, laundry, and so on.
Supermarkets typically serve customers out to restock their home inventory. They make sure that there’s a wide variety of essential products so customers can get everything they need within a short time.
The retail design in a supermarket focuses on displaying products in a manner that’s attractive to customers so items sell faster. Most supermarkets display many different variants of a product so customers can choose what they like.
Popular examples of supermarkets include Big Bazaar and Costco.
Convenience Stores
A convenience store is a relatively small retail business that provides the most basic products to consumers within a locality. Such stores don’t carry many categories of products. Typically, only two or three variants of each product are available at the store, and the volume is lesser.
Because they focus on the most basic needs of consumers, convenience stores are found almost everywhere. They provide fast service that’s customer-centered.
Drug Stores
These retail stores specialize in drugs. Some drug stores sell drugs only, while some sell other products that are not strictly pharmaceutical. There are drug stores, for instance, that also sell protein supplements, small medical equipment, beauty and healthcare products, and so on.
Drug stores are found in almost all localities around the world.
Discount Stores
Discount stores are retail outlets that sell all products at an attractive discount. These stores usually buy large volumes of products from the supplier or manufacturers. They also typically establish a large chain of outlets to liquidate products to customers by passing on the margins.
The three distinct features of discount stores are:
- Selling products at a significantly lower price
- Low profit margins for products
- A markedly high volume of sales
Arguably the most popular example of discount stores is Walmart.
Used/ Off-Price Goods Stores
Over the years, the global market for used goods has experienced tremendous growth, thanks to the low prices of products in this sector. In the recent past, giant brands like Audi have started offering support and ratings for their used products.
Off-priced goods are also quite popular among consumers today. These products are usually new but with some slight defects. The goods may also constitute left-over items that didn’t meet the mark.
Hypermarkets or Super Stores
Hypermarkets are huge retail stores that carry a large variety of products under their roof. A typical hypermarket will usually have almost every product a residential consumer can buy. Such a store isn’t found in a mall; it’s a fall by itself.
Most hypermarkets sell goods at discounted rates to attract more customers. Generally, you can find products of all levels, from low to high, in a hypermarket. That’s why these stores are referred to as complete markets.
Some of the most popular hypermarkets in the world today include Costco, E-Mart, GS Supermarket, and Lotte Mart.
Retail Stores Are Viable Business Ventures
The retail industry will continue to offer lucrative business opportunities for those interested in the sector. While the capital needed to open most types of retail stores we discussed in this post is considerable, the massive turnover will more than make up for it.
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