Table of Contents
Marketing involves identifying the customer needs in order to satisfy them. It comprises all the attempts that are made to make the consumers happy and maintain them. Retail is the sale of items in small quantities majorly from a fixed place. This may include stores, kiosks and boutiques. Retail marketing is therefore the satisfaction of consumer needs through the sale of items in affordable quantities. The review paper explores models of retail as well as threats facing the retailers. Documentary relevancy and competency of retail trade is also analyzed before making a conclusion by the expected changes that retailers should make, (Gilbert, 2003).
Modes of Retail Marketing
Retail business exists in various forms. The models depend largely on the type of product, place of sale and the people who consume the products and services. Retail business requires the consideration of the product because a product that people buy in one place may not be liked by other persons in different places. Some of the major models of retail trade include malls, general stores, specialty stores, discount stores and supermarkets as discussed below.
Malls form part of retail shops. It is characterized by numerous retail shops. These shops normally operate under one roof with a single outlet. This model of retail market stocks food products as well as entertainment services. Malls are situated in busy areas where there is a high population of people. Such places include, junctions, meeting points and bus terminus. Goods are sold in the required quantities and with fair prices, (Dunn, 2007).
General store is another mode of retail marketing. These are large shops which are mostly located in rural areas. The shops provide essential requirements for the people in the community where they are established. General store makes it possible for the rural population to enjoy a wide range of products without travelling to the towns. They are known to sell goods with affordable prices and in the required quantities.
A specialty store is also a model of retail marketing. It is a very unique form of small business operation. This is because it is a special retail shop that serves a particular group of clientele. Some of the examples include cosmetic shops, ladies ware, dog pet shop, furniture shop and mobile phone shop among others. This mode of retail shop has a superior service level to the customers. This makes them to be able to attract and retain more customers in their shops
Discount store is yet another form of retail marketing. This is a type of small scale shop that uses price cut-offs in order to survive in the business. It is a very competitive kind of mode. This is due to the fact that the amount of discount given determines the volume of sales that the retailer makes. These shops stock a huge range of products and services. Discount stores majorly deal with goods which are less fashioned. Retailers in this business have strong bargaining skills to enable them to negotiate with the respective clients during sales.
Supermarket is a renowned mode of retail marketing. They are found in all the countries in the world. These are large retail shops that are usually located in very strategic places in the society. Such locations include shopping centers, towns and estates. Superstores normally stock enormous variety of goods ranging from households, electronics, jewelry and clothes among others. They are self-service retail shops. Customers are allowed freely walk and choose items as they wish and at their pace without interference, (Krafft, 2006).
From the review above, it has been established that there are various forms of retail dealings. Besides, substantial evidence has been put across to explain the mentioned modes of retail marketing. This is a clear indication that retail business has indeed different modes.
Threats of SME Retail in U.K
SMEs are the major contributors of economic growth in the U.K. But they seem to be under a big danger. This is because there are a number of issues that have arisen in the nation. They include bank reforms, emergence of ecommerce, and the economic crisis which has made most consumers to review their spending. These reasons pause a great danger to these retail shops in the U.K as discussed below.
Bank reforms in the U. K are one of the major threats to SMEs. Banks are the major financiers of these retail businesses. Due to the increased financial crisis in the world, the banks face high risks in their business. The government of U.K came up with policies to manage this risk. This has made them to cut down lending to the SMEs. The cost of credit has been raised as the banks require high securities in order to give loans. Retail shops are left without funds to stock and expand their businesses. The scenario has resulted to a major challenge for retail business in U.K, (Financial Times Report).
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Emergence of e-retailers has also threatened SMEs. The world has increasingly grown in technology. U.K has not been left behind in the process. This development has led to the use of ecommerce. Customers make orders through email and phones and some retailers have developed web systems to manage their businesses. E-retail is growing rapidly and the SMEs which do not have these facilities have been left behind. Customers find it easier to use internet and phones to transact businesses than going to the retail models to get the required items. This to a large extent has affected SMEs in U.K, (Armstrong, 2011).
Another threat to the SMEs is the economic crisis. This is the global financial meltdown which has been felt by all the economies of the world. Consumers in the U.K have also been affected by the scourge. This has made them to reduce their shopping expenditure which is the key source of business to the SMEs. The clients now spend their money sparingly so that they can meet all their needs with the meager finances that they have. This trend has greatly affected the retail outlets in U.K. Most of these shops are making losses and are at the verge of closing their business due to reduced customer spending, (Armstrong, 2011).
The discussion above has clearly shown that SMEs in the U.K is threatened. This has been proved by the data put across in the above argument. It has been discovered that the retailers are vulnerable to the dangers specified. There is then need for them to make some changes so that they can survive in SME.
Relevant Theories, Commentaries and Statistical Trends in U.K
There are a number of theories, commentaries and statistical data to support this review. Peter Stands, the head of emerging market focused bank has sharply criticized the bank reform policy. He is concerned about the way in which the policy makers in U.K have made it difficult for SME retailers. Peter argues that the scholars should be very careful so that they do not burden SME industry through high lending costs. He further hints that there ought to be a balance between economic growth and effective banking. This is because he found out that the policy makers concentrated on bank stability only, (Financial Times Report, 2011).
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Actinic Research on retail market in 2009 showed that there was increase in the ecommerce in the U.K. Most retailers were taking orders through the phones and emails. Sales were made by the online services. The report further revealed that out of the 277 SME retailers who were studied, 96 of them had e-retail. This number was viewed to be very high by then. It was found that the use of ecommerce had risen to 35% up from 11% in the 2006. Besides, the report also stated that many SME retailers were using electronic point of sales in their stores. This was very encouraging indeed. Barling, the chief executive of Actinic Research commented the e-retail is expected to grow substantially since it seems to be the only way to SME retail growth and profit making, (Actinic Research Report, 2009).
Journal on Retail Management has also contributed o this review. The report has shown the role of training and mentoring SME retailers in the U.K. That is the scholars discovered that there is need to offer some teaching and guidance to retail owners to enable them to be effective in their operations. It also cited the difference that exists between coaching, training and consultancy for SME retail marketing. According to this journal, retailers can only do better in their SMEs if they are properly guided and trained, (Journal on Retail Management, 2003).
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Capabilities of Retailers
SME retails shops are capable of surviving despite the increasing demand in the market. Retail business is capable in a number of ways. They include use of ecommerce, innovation and customer satisfaction. The retailers should develop suitable web that can assist them in business activities. With the emergence and ever growing technology, retailers should take advantage of this opportunity so that they can be effective. This will ensure that orders and quotation are sent through the internet. The business period will be shortened due to the use of technology. This would make the retailers to remain competent in the market, (Gilbert, 2003).
Another way that can make the retailers to be more competent is innovative marketing. The world is ever changing. Business strategies and plans must be more creative and inventive so that the retailers can become competent. The products must be made again and again so that it remain fit I the market. If the products are not improved, the business may not be able to sell it because it may become outdated. This is dangerous and may make a retailer to close down as other competitors survive. It is therefore significant for retailers to focus on innovation.
Customer satisfaction is also a key area to be focused. Consumer service must be exalted by the SME retailers. The customer must be made happy and contented. This may include a warm greeting from the retailer to the customer on their arrival. Let the customer feel welcomed and important. Help them to find all the items that they are looking from the shop. This will make the customer to be satisfied. It is therefore very important for the retailer to focus on customer satisfaction so as to carry on.
Changes that Retailers Should Make
Retail Marketing has both the threats and competencies. It is therefore important for the retailers to make substantial modifications for them to survive in SME Business. The changes are aimed at helping the retailers to improve in business and outshine other competitors in the same market. Some of the changes include the review of work force, diversity in resource mobilization and overhaul of the retail business structure.
Work force must be changed. This change may include new recruitment or departmental transfer after with sufficient consultation with respective. Customer satisfaction depends majorly on the employees who are working in the shop. The retailer should ensure that he has employed trained and qualified staff to run the business. The workforce must also be regularly trained and motivated so that they can treat the customers well. This would go a long way in satisfying the customers in the store. The business would thrive and grow in size. Profits would increase when this change is affected as required.
Change in the financial focus is also required. The economic crisis that was felt in 2007 was a lesson to so many countries. As seen from the earlier debate, the recession made the government of U.K to introduce bank reforms. It was a group of policies that were meant to protect banks from falling. It has resulted to higher rates of borrowing almost everywhere across the globe. It has made SMEs to suffer because they cannot access funds. Retailers should change their focus from banks to other financial institutions, governments and Non- governmental Organizations for easy access to finances, (Jones, 2002).
Change in the organizational structure is vital for the retailer to experience business progress. This may involve the plans, aim and objectives. The retailer should use Swot analysis to determine the status of the business and hence make appropriate decisions. The businessman should analyze the strengths, weakness, opportunities and threats of the retail shop. After the analysis, the retailer should access the situation and make the required adjustments.
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In conclusion, the review has given sufficient data about retail marketing. Various discussions have been put across to shade more light on the topic. From the paper, SME retails are under a threat. It is therefore important for the governments and retailers to join hand so that the situation could be saved. This requires the maximization of key competent areas and radical changes in the sector for it to survive.