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Coping with Retail Giants critically analyzes the modern retail market and identifies how businesses gain the competitive edge over the major retailers that currently control the market. Dr. Samli argues that as society advances economically, consumers will seek better values generated by the retailing sector.

Inhaltsverzeichnis

Frontmatter

Introduction

Any viable and proactive society must generate and distribute consumer value. This value is generated by the society’s economic activity and distributed mainly by retailing. The consumer value that is generated by that society must be satisfactory for the whole society and must be delivered equitably and efficiently. Therein lies the challenge for the retailing sector. But, that sector is rather volatile and constantly experiences sharp turbulences. Many economic changes apply competitive pressures and consumer needs make it absolutely necessary that each and every retail establishment offer some value to the market. If the market does not appreciate what is being offered by the retailer it is the curtain for that retailer. This scenario repeats itself constantly in a dynamic economic system such as ours.
A. Coskun Samli

1. Preopening Preparations

Consider the two following stores. Store one looked for a low-rent place and went to an area which is off the beaten path; the store did not have a nice appearance; the owner manager assumed that customers would come to the store regardless; this did not happen and the store went bankrupt.
A. Coskun Samli

2. Retail Marketing Strategy Development

Aretail establishment must have certain features that distinguish it from others. Those features will enable consumers to identify it and be attracted to it. At the same time, these distinguishing features should dissuade consumers from patronizing other retail establishments for the same products or services. The unique and distinguishing characteristics of the particular store must be appealing to prospective customers. This means the unique characteristics of the retail establishment must be congruent with what its customers would like to buy. That is the winning strategy in retailing, which is coined “differential congruence” (Samli 2004).
A. Coskun Samli

3. Fitting into Multilayered Retail Competition

Saks Fifth Avenue competes with Neiman Marcus rather directly, but even indirectly it does not reflect the business Dollar Tree stores, a chain of super discount stores. On the other hand, because of the accessibility of the retailing facilities and variety of these offerings and because of the mobility of customers and their access to retailing information, in a general sense all retailers are competing with each other.
A. Coskun Samli

4. Major Trends in the Retailing Sector Which Independents Must Know

Aretailer must be aware of national as well as local trends and must be able to cope; better yet, if possible, to keep ahead of these developments. The smaller the retail establishment, however, the less important national trends are. It is quite likely that national trends may not quite reach to small neighborhoods. However, they do generate a trickle effect. Retail establishments, particularly small retailers, must be more aware of local conditions such as a major change in the local highway system that would redirect local vehicular traffic and change the traffic on which local retailers rely. Similarly, the announcement of a major discount retailer locating outside of town or the change in the town’s development plans, say, from east side to west side, may be more critical to local small retailers than the stock market crash or a recession in the national economy. This does not mean that local small retailers should not know or, worse yet, not understand national trends. It simply means that retailers must be aware of local conditions that may have an immediate impact on their performance.
A. Coskun Samli

5. The Retail Evolution

If we don’t know how we got here, it will be hard to decide the best way to go next. Not knowing the natures of the evolution which took place in the retail sector of this country makes it almost impossible for a new retailer to function. Just what may be expected to be the far-reaching impact of developments in retailing? How these changes are likely to touch our particular business must be a constant concern on which to ponder. Although selectively, revolutionary changes take place, retailing typically experienced a continuing evolution.
A. Coskun Samli

6. Capitalizing on Market Potentials

Throughout this book, the location theme has been repeated. Retailing not only follows the population dispersion, but also locates conveniently to certain population groups. It must be stressed forcefully that location is the first life bloods of retailing. No matter how good, how attractive, or how accommodating, if a retailer is not located properly, there is no possibility that it can achieve success.
A. Coskun Samli

7. Consumer Behavior and Retail Strategy

The small and medium-sized independent retailers’ success is directly related to understanding consumer behavior, particularly the behavior of the store’s customers and responding effectively. Here, the point must be made emphatically that understanding consumer behavior is not for the purpose of exploiting consumers, but to satisfy their needs better than retail giants who treat customers as simply numbers. The independent retailer’s strength is to make sure that the customers, individually, are satisfied so that they will come back to the store again and again. The key to success is the creation of consumer value.
A. Coskun Samli

8. Strategy Alternatives

Having a game plan is the strategy which implies being proactive in fulfilling certain goals. Of course, these goals primarily revolve around being proactive and catering to the particular target market in the most favorable manner. This means providing goods and services in a most favorable terms. In doing so, the retailer can achieve competitive advantage and customer loyalty. Developing competitive advantage and gaining customer loyalty demonstrates that the retail establishment has developed differential congruence which means it is helping its customers to improve their lifestyles, and, of course, simultaneously improving its chances of survival and success.
A. Coskun Samli

9. Developing, Measuring, and Managing Store Image

Aconsumer entering Sam’s or Costco certainly experiences different feelings from one entering Neiman Marcus or Saks Fifth avenue. These feelings will be accentuated by ambiance, merchandise, service, and other store features (Samli 2004). Every retail store has a personality that is the sum total of impressions a consumer will experience as he/she enters the store and shops around. That atmosphere, which is called store image, may be very suitable for some customers, and totally unsuitable for others.
A. Coskun Samli

10. People Are Our Strength

Retailing is people business as such; it cannot be managed by clichés and dogmas. All that is being said is “people are the key cost in your business, keep that cost low.” Would paying low salaries and replacing the employees with cheaper labor be really profitable? Discounting giants may think so or they simply don’t care. Small independent retailers must consider their people a major asset rather than a key liability.
A. Coskun Samli

11. We Must Communicate with Our Market

In our market system for a business establishment, retailing is not exception; not to be known by the prospective customers is perhaps the worst thing that happens. In the market system no business can afford to be a well-kept secret. The attitude that “well, they know we are here, and they will come” does not work. Many smaller businesses have the attitude that all we need is word of mouth; we don’t need any advertising. This orientation is deadly wrong. As we know just because we are here does not mean success. Any business, particularly, a retailing establishment, must communicate with the market and in time attempt to project and maintain a store image.
A. Coskun Samli

12. Developing a Merchandise Mix

It is essential to realize that a retailer, any retailer, survives by providing its customers not what it wants but what the customers want. This may not be a problem for discounting giants since they offer everything but it is a big issue for smaller independents. They must offer important value to their customers that would make the quality of their lives better. For the retailer this means survival and perhaps prosperity. The retailer has to perform a number of functions related to product and service assortment. The process is called merchandising. There are four key components of merchandising: buying, planning, managing, and controlling. These four components must lead to, above all, providing the store’s customers a highly desirable merchandise mix. This mix needs to be adjusted as the needs of the store’s target market customer’s change. In order to develop a desirable and adoptable merchandise mix, there must be a certain type of preplanning process, which is supported by an adjustment system. All of these activities are preceded by an effective buying plan.
A. Coskun Samli

13. Pricing Strategies

Obviously, without an adequate price policy the retailer cannot survive. Here the smaller independents cannot compete with the modern discounting giants, but it does not mean they cannot offer a reasonable price and provide a reasonable consumer value. Pricing is a complex issue. Many retailers shy away from doing research and experimenting with their own pricing strategies; as a result, many retailers place emphasis on the manufacturer’s suggested prices. However, each retailer is different, and pricing should be, even in a small way, a part of this different identity. It must be reiterated, however, that while discounting giants are competing primarily on the basis of pricing, smaller independents can offer good service and make their customers not feel as if they are simply numbers.
A. Coskun Samli

14. Being Connected to a Supply Chain

Many small retailers are connected with a large retailing line either as being one of the stores in the chain or being in a franchising arrangement. This connection would modify independent decision making and further modify the flow of products which we call here logistics, despite its cost benefits being connected to a supply chain would limit freedom of the retail unit in many different ways.
A. Coskun Samli

15. Store Performance Evaluation

It is extremely important that the retail store is evaluated regularly. Although it is important to evaluate the store’s performance as a whole, it may be even more critical to determine which activities or sections of the store are doing well and which ones are needed to be evaluated carefully, because they may be performing, say, not up to par. Only if all of the activities are in a desirable form is it possible for the store to perform a synergistic overall performance. Careful evaluation of performance, in proper detail, also provides a learning curve of what to do and what not to do.
A. Coskun Samli

Backmatter

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