Selling techniques and trends in retailing

Branding and Packaging

Features:

  • Branding means selling of goods under a trademark or brand name of the manufacturer, wholesaler and retailer. The trademark is clearly displayed on the package of the container.
  • The aim is to make the goods of manfacturers distinguishable from each other.
  • Branded goods are uniform in size, weight, quality and sometimes price.
  • Packaging of goods serves as a protection for the goods, gives them an attractive appearance and helps to identify the branded products.

Advantages to the manufacturer:

  • The manufacturer can give an identity to his products and therefore can work to create loyalty for his products amongst the customers.
  • It enables advertising and other forms of promotion therefore it increases turnover and results in economies of scale.

Advantages to the retailer

  • The retailer does not have to weigh or pack the goods.
  • There is no need for the retailer to have specialized knowledge of the product as instructions are printed on the labels of the good or sometimes a separate instruction manual maybe included with the package.
  • The retailer usually does not advertise branded goods.
  • The retailer can offer self service as the goods are already packed and branded.

Advantages to the customer:

  • The customers need not waste time inspecting the goods as they are already branded and packed. Goods are standardized products which are uniform in quality.
  • Customers are able to enjoy better quality of products.
  • Customers are well informed about the products through the labels and instructions manuals included in the package.

Disadvantages:

  • Manufacturers have to spend large amounts of money on advertising.
  • A retailer may have to keep a stock of different brands of the same product to meet the customers’ demand.
  • Branding and packaging increases prices of goods for customers.
  • Branding leads to imitation of goods which often negatively affect quality.

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Self Service

features:

  • The customers are allowed to choose the products by themselves with a trolley or a basket.
  • This system is widely used by large retailers.
  • Self-service is almost impossible without branding and packaging.
  • This service has been developed to make shopping convenient for modern people who have busy schedules.

Advantages to the retailer:

  • It is very economical as it cuts down costs of employing shop assistants.
  • Self-service increases turnover as it increases impulsive buying.

Advantages to the customers:

  • The customers can easily select the goods that they need since the goods are pre-packed.
  • The customers can take their own time to select the goods without any pressure from shop assistants.

Disadvantages:

  • Much capital is needed as shops need to be large and spacious.
  • More variety of goods is needed. This results in capital being tied up in stock.
  • Self-service may result in possibility of shoplifting and pilfering. However modern technology has enabled to solve this problem.
  • Customers are deprived of personal service.
  • Customers maybe tempted to buy goods that they do not require.
  • Safety measures like cameras, mirrors, etc. has to be installed to avoid pilfering.

After-Sales Service

features:

  1. After-sales service is an undertaking done by the retailer, or sometimes the manufacturer or its agent, to repair any faults which occur to the articles sold, within a certain time frame. Sometimes the undertakings could be to provide some maintenance service at regular intervals for a given period of time from the time of the sale to ensure the efficiency of the article.
  2. Sometimes this after-sales service is known as warranty and the period in which it is provided is the warranty period.
  3. After-sales service is usually provided for permanent or durable goods such as machinery, motor vehicles, expensive electronic items, etc.
  4. Since durable goods and machinery are highly technical and complex, retailers who are normally trained agents of the manufacturer or the sole agent of the manufacturer undertake the all-important task of providing after-sales service.

Benefits of after-sales service

  1. Good and efficient after-sales service gives a product a good image and increases its competitiveness with its rivals. Therefore it helps to increase its sales. Consumers would hesitate to buy an expensive durable good if its after-sales service is poor.
  2. Customers are assured of of an efficiently working product at least during the warranty period. Should the mechanical faults become apparent while the article is in use, the consumer is assured of getting it corrected and if the problem still persists, he may even get a replacement.
  3. Customers are assured of expert technical advice regarding the maintenance and operation of the product.

Disadvantages of after-sales service:

To the manufacturer and retailer

  1. High overheads are incurred to maintain technically-trained staff. Sometimes there is need to maintain workshops fitted with proper equipment at strategic points throughout the country.
  2. Sometimes there is need to replace an article if it is defective and if the fault cannot be detected or is beyond repair. The replacements have to be written off as losses.

On the consumer

  1. The cost of after-sales services is often included in the selling price of the product. Therefore, the consumer is paying a high price for the product since the after-sales service may not be even needed for the product.
  2. After-sales service is available only during the warranty period. If the fault is detected after the warranty period, the consumer has to pay the repair bill by himself.

Bar Coding

A bar code consists of parallel black stripes different widths and with different spacing between the stripes, printed on the wrapper or the packaging itself. it stores information about the good and the price. Bar codes can be read by using special scanners. The information is then sent to a computer to be processed. The information like the type of goods, its price and weight can be readily accessed. Instead of using price tags for each item, bar codes are used at almost every retail shop nowadays.

Advantages of bar coding:

To the retailer

  1. It is convenient and it saves time and hence labour costs.
  2. Information about the item can be read accurately, quickly and easily by special scanners that are linked to computers at check points. This possibility of human error that could occur if the staff has to key in the vital information.
  3. Information can be better organized and the retailer can use this data to do planning and to manage business more efficiently.
  4. It helps management greatly in controlling and supervising the movement of inventory in the premises. At the end of the day, the retailer will be able to know how much each item was sold. New inventory can be ordered whenever the need arises. This saves costs as the retailer does not need to hold excessive stock.

To the customer

Bar codes reduce the time needed to serve the customers at the payment desk, therefore the customers can check out faster.

the negative effects of bar coding

On the retailer

Initial cost of installing the system and training the staff is required. The whole retail output has to be computerized. This could increase the running costs.

On the customer

Bar codes may not display the price that the customer can check before going to the counter or he may have to call a shop assistant to ask the price. To solve this problem, many retail outlets now print the price on the tag together with the bar code.

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EPOS (Electronic Point of Sale)

EPOS terminals are cash registers which also acts act as terminals to a main computer system. As well as providing customers with itemised bills, these systems also give information for the management.

Shopping Centres

Features:

  • A shopping centre is a large multi storied building located in town centre, consisting of many shop units, each owned by different individuals.
  • Each shop may sell different type of goods.
  • A wide range of goods and services are available in a shopping centre or complex.
  • shoppers can enjoy ‘one-stop’ shopping as they buy all the goods they need under one roof.
  • Amenities such as car parking, lifts, restaurants, etc, are provided.

Automatic Vending Machines

Features:

  • These machines are placed at the entrance of public places like cinemas, parks and supermarkets.
  • The customer has to insert the correct amount of money into the machine, press a button and turn a lever and the goods come out.
  • Such machines are either bought or hired by the operator.
  • Goods like cold bottled drinks, hot drinks, cigarettes, sweets, etc could be sold in this way.

Loyalty Cards

Most large store chains now have what is called as a ‘loyalty card’ scheme. Each time a customer uses the card, points are added. When the number of points earned reaches a certain value, customers are either given discounts on their purchases or issued vouchers that can be used to purchase goods from the store.

The purpose of loyalty card scheme is to get repeat customers. They would come either to redeem benefits out of their previous purchases or to make the purchases to add points. This is also a method of sales promotion.

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