By taking over the function of retailing from the wholesales and manufacturers, retailers relive them from selling goods in small quantities to te consumers. While ost retailing occurs through retail stores, it may be done by any institution.
Key Success Factors in Retail Business
The success of a retail business depends upon various factors. Some of these are as follows:
1. Catering to consumers
To survive in retailing a firm must satisfy its consumers.
It must take care of them in every respect.
A successful retailer as “a merchant who sells goods that will not come back to customers who will.”
2. Serving Producers and Wholesalers
To be successful, a retail firm also most fulfill its duties towards producers and wholesalers.
A retailer must render the various services like giving them market information, reducing risks of loss, using distributing skill and personal selling, and becoming a source of market intelligence and consumer behavior to them.
Related: 11 Key Factors Determining the Sales Compensation Plan (Explained).
3. Adequate Stock of Saleable Goods
To delight the customers, the goods must be adequate and of the latest design and style.
The retailer must select the up-to-date goods which are liked by the consumers.
Overstock or understock will create problems for the business. Hence, a retailer must keep a reasonable stock in the shop.
4. Perfect Knowledge about Goods
A retailer should have thorough knowledge about the goods he deals in order to be able to satisfy his customers and answer their questions.
5. Suitable Location
The retailer should select a suitable location for his business which is easily accessible to the customers.
The best location helps in increasing the customers. It adds to sales volume.
Related: 19 Characteristics and Objectives of Sales Organization (With Examples).
6. Adequate Capital
A retailer should command adequate capital at his disposal because he has to allow some credit facilities also to his customers.
7. Proper Buying and Sales Policy
A retailer should adopt the policy of buying the bulk can increase his sales satisfying himself with a lower margin of profit.
Overbuying should be avoided.
The buyer must be made from the right manufacturers and at the right time.
8. Expert in Salesmanship
The retailer should be well versed in the art of salesmanship.
He should underline the habits and temperaments of his customers. He should know the psychology of customers.
He must have knowledge of selling procedures, marketing techniques, and consumer behavior.
9. Attractive Display And Advertisement
In order to attract more customers, the retailer should arrange things in an attractive style.
Goods should be prominently displayed and advertised. It should be properly arranged on shelves and on the counter.
The window display should be attractive. It costs little, but it is very effective. It appeals to the shopping public and Secure good business.
Related: 17 Key Features of an Ideal Compensation Plan (Explained).
The articles must be exhibited in such a way that the eye can detect every detail put at the window.
The counter display reminds the customers what to buy, in fact, it induces them to buy.
10. Credit Facility
In Modern Times providing credit, facilities have also become necessary, for which the retailer should know the financial position of his customers and their habits also.
11. Competitive Pricing
The competitive prices must be determined.
They should be lower than the other retailers’ prices.
Prices must be based on the quality of goods and market price levels.
12. Provision of Services
To be successful, the retailer should provide many free services like home delivery, change of faulty goods, the return of money, the grant of credit, maintenance, and repair facility, etc.
This will improve the competitive strength of the business.
Service also includes friendly, knowledgeable self-help, liberal return policy, and ample postsale service.
Related: How to Choose Right Sales Promotion Programs (Explained).
13. Proper Advice
The retailer must also provide proper guidance and advice to customers in relation to his buying problems.
He must be helped to buy the right kind of product according to his needs and financial capacity.
He must be given the best solutions to his buying of problems.
14. Cooperative Behaviour
The retailer must follow the policy of “the customer is always right.” He is the king of the market.
Hence, the behavior of the retailer must be courteous, cooperative and humane.
15. Honesty
The retailer should accept that ‘honesty is the best policy‘.
He should not indulge in antisocial for wrongful practices like hoarding, profiteering, adulteration, charging high prices, and cheating the customers.
Bonus: 13 Types of Wholesalers in Marketing (Explained).
16. Efficient Management
It is said that “to enter retailing is easy, to fall is even easier.” And failure happens due to mismanagement.
Hence, the management of retailing must be efficient by better planning, organization, and control.
High efficiency can be obtained by proper selection, training, and motivation of Salesforce.
17. Innovation
Retailing is a dynamic field. The retailing first must always innovate its interior layout, stock, decoration, display, selling, procedures, and shop environment.
It must change with changing demographics, technology, and industry structure.
Largely due to competition, it must add experimentation.
It must experiment with non-traditional locations and with modified formats. It must introduce Novelty and convenience.
18. Identification of Market
The retailer who is able to identify a market niche and meet consumer expectations will farewell.
Retailers who try to be all things to all people, or who miss a key component, will be washed away in a tidal wave of competition.
Related: Top 5 Types of Distribution Channels in Marketing (Explained).
What are the factors that create a successful retail business?
To be successful, the retailer should provide many free services like home delivery. He is the king of the market. Hence, the behavior of the retailer must be courteous, Cooperative and humane.
Thus, now you know the key success factors in the retail business.
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I am doing retail apparel business since 5-6 years but I haven’t found such a nice piece of information and inspiration anywhere. I use point of sale from erply and really wish to do social marketing now. Thank you for sharing real knowledge.
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