LO1  Identify retailers in terms of the utilities they provide.

Retailers provide time, place, form, and possession utilities. Time utility is provided by stores with convenient time-of day (e.g., open 24 hours) or time-of-year (e.g., seasonal sports equipment available all year) availability. Place utility is provided by the number and location of the stores. Possession utility is provided by making a purchase possible (e.g., financing) or easier (e.g., delivery). Form utility is provided by producing or altering a product to meet the customer's specifications (e.g., custom-made shirts).

LO2  Explain the alternative ways to classify retail outlets.

Retail outlets can be classified by their form of ownership, level of service, and type of merchandise line. The forms of ownership include independent retailers, corporate chains, and contractual systems that include retailer-sponsored cooperatives, wholesaler-sponsored voluntary chains, and franchises. The levels of service include self-service, limited-service, and full-service outlets. Stores classified by their merchandise line include stores with depth, such as sporting good specialty stores, and stores with breadth, such as large department stores.

LO3  Describe the many methods of nonstore retailing.

Nonstore retailing includes automatic vending, direct mail and catalogs, television home shopping, online retailing, telemarketing, and direct selling. The methods of nonstore retailing vary by the level of involvement of the retailer and the level of involvement of the customer. Vending, for example, has low involvement, whereas both the consumer and the retailer have high involvement in direct selling.

LO4  Classify retailers in terms of the retail positioning matrix, and specify retailing mix actions.

The retail positioning matrix positions retail outlets on two dimensions: breadth of product line and value added. There are four possible positions in the matrix—broad product line/low value added (Wal-Mart), narrow product line/low value added (Payless Shoe Source), broad product line/high value added (Bloomingdale's), and narrow product line/high value added (Tiffany). Retailing mix actions are used to manage a retail store and the merchandise in a store. The mix variables include pricing, store location, communication activities, and merchandise. Two common forms of assessment for retailers are "sales per square foot" and "same store growth."

LO5  Explain changes in retailing with the wheel of retailing and the retail life cycle concepts.

The wheel of retailing concept explains how retail outlets typically enter the market as low-status, low-margin stores. Over time, stores gradually add new products and services, increasing their prices, status, and margins, and leaving an opening for new low status, low-margin stores. The retail life cycle describes the process of growth and decline for retail outlets through four stages: early growth, accelerated development, maturity, and decline.