What is retail?
Retail is when an enterprise sells a product or service to a consumer for its own use. The transaction itself can be done through a variety of different sales channels, such as online shopping, in physical stores, through direct sales or direct mail. The end user is the buyer.
Type of retail business
There are about 3.7 million retail stores in the United States, from shops to restaurants, salons to gas stations, pest control providers and auto mechanics. These companies employ nearly 42 million people, making retail the largest private-sector employer in the country.
There are four major categories of retailers:
Hard lines – things that tend to last a long time, such as home appliances, cars and furniture.
Soft goods or consumer goods – things like clothing, shoes and cosmetics.
Food – like meat, cheese, produce and baked goods.
Art – such as art, books and Musical Instruments.
You can also find different types of retail stores in these categories. Some of the most common types include:
Department stores – the oldest and largest place for consumers to buy products under the same roof. Goals and messi’s example.
Big box stores – retailers that specialize in one type of product, such as electronics. Best buy and Bed Bath and Beyond are examples.
Discount store – a department store with discounted goods and low prices. Walmart and kmart are examples.
Warehouse stores – these undecorated warehouses often require you to be a member to get a low price. BJ and Costco are examples.
Mom and pop stores – small businesses run by small business owners, usually small shops. These are your corner shops and local stores.
E-tailers – online retailers that sell and deliver products to your doorstep via the Internet. They don’t usually have physical stores. Amazon and etsy are examples.
Retail supply chain is composed of four participants: usually make goods manufacturers, to buy from manufacturers and resold to retailers, wholesalers or distributors, and retailers buy from wholesalers and then sold to consumers. Each step in the process has a mark or profit margin for purchase. The manufacturer calculates the cost of making the product and then adds the percentage of profit before selling it to the wholesaler. Wholesalers do the same, increasing the percentage of profits they pay for their products. Retailers are increasing their profit margins to product costs before selling their products to their end users, or users.
So a product with a price of $1 could be sold to wholesalers for $2. The wholesaler buys it for $2 and sells it to the retailer for $4. The retailer then buys it for $4 and sells it to the buyer for $8. That’s how everyone along the way can make money.
Point of sale
In order to complete the sale, customers of traditional retail stores bring their shopping to the cash register, where the staff records the total cost and ends the sales. Today, some supermarkets have self-checkout aisles where customers can scan their items and check out with a credit card or cash. Customers buy online stores on a computer screen, click on the product they want, and enter their credit card information to complete the sale.