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Retail Economics

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Before we go further lets refresh Lesson No. 1

Q1: What is the definition of retailing?Q2: What is the role of retailing in marketing mix?

Q3: Write five benefits of retailing for consumer?

Q4: Define these terms: Channel Power, PoS PoP,Retailers as Communication Hubs, Distribution

Channel,

Q5:Name the key drivers of retailing in India andPakistan.

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Before we go further, lets refresh Lesson No. 1

Q6: Name four international retailers.

Q7:Name at least three famous retailers inPakistan?

Q8:What could be the possible problems for

retailers in Pakistan.

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Part AQuestion : How retail provide various benefits to

consumers?

Think of : Last time when you went shopping, what benefits

you got from a retail store?

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Retailers buy products in large quantities

and then break them in to small sizes for

individual consumers.

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Retailers try to provide the different types

of products available products to itsconsumer.

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Stocking the goods until customers are

willing to buy and use them.

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Retailers provide goods and services at Desired time

Desired Place

Desired form

Desired Price

Desired sizes

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Help for manufacturers to plan their production:

Placing orders according to demand

Placing orders for product in demand To make changes in product design ,layout

and quality according to the feed back of

retailers

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1. Economic Significance of Retailing?

2. Retail Consolidation

3. FDI in Retail Sector in Central Asia

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Retailing affect every facet of life.Just think of how many contacts

you have with retailers when youeat meals, furnish your home, haveyour car fixed , buy cloth for a

party, job interview

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Retail Sale in US 2001: US$ 3 trillion (only

store sales) In 1997, 28 Lac Retail firms in US 80% retail sales are organized in US , 70% in

Western Europe ,40 % in Brazil and Argentina

and 35% in Korea & Taiwan 2002-03 Share in Pakistans GDP :Wholesale

& retail -15.5 %

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Most of big economies depends upon retailsector.

By 2010 around 17% of total US work force(26 Million people) are employed in retailing

and it has growing trend World total sale $6.6 trillion , Ist in theworld

50 fortune 500 companies are in retail 25 of the Asian top 200 firms are retailers Wal Mart s turnover is 1/3 of India's GDP 10% of the worlds billionaires are retailers( Repeat from Lesson 1 )

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Management Opportunities

To deal with highly competitive and challenging

environment. Opportunities in finance,

accounting, HRM, logistics, computer systems,

Marketing

Entrepreneurial opportunities

For those who want to start their own business.

Examples:Wal Mart, Giorgio Armani

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Employmento Retailing is one of the largest industry in term of

employment and it is estimated that this trend will growin future.

o 13.5% of Pakistans employment is in Whole sale and

retail sector.Higher GDPo Organized retailing has huge potentialo Transformation of Pakistans Agricultural based

economyo Promotion of SMEso Low Unemployment rate will enhance productivity of

labor force

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Real Estateo Better use of resources including land, laboro Create a better image of country

Tourism / out bound Shoppingo Helps to promote tourism , national image,travel , hotel industry

o Generate more revenue for Pakistano Promotion of our traditional productso Examples: Kuala Lumpur, Dubai, NY,London , HK, Singapore have shopping

festivals whole year around , Shoppingextravaganzas

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Outsourcing opportunities

o Improved SCM

o MIS system in place

o New trend in shopping . modernization

o Reduce unemployment, Improved economyo Other related Benefits

Revenue for Government through taxation

o Sales tax,

o VAT, Custom duties

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1 WalmartUs

$421,849

2carefour France

$121,519

3 TescoUK $94,244

4 MetroAG

Germony

$893211

5 Kroger US 82189

http://en.wikipedia.org/wiki/Walmarthttp://en.wikipedia.org/wiki/Tescohttp://en.wikipedia.org/wiki/Tescohttp://en.wikipedia.org/wiki/Walmart

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The changes which occurred over the last decade in the retailsector in urban Pakistan, in terms of a decrease in traditionalkiryana stores, an increase in general stores, and the

emergence of new formats such as superstores, malls, andretail chains. These trends are discussed in the context ofbroader socioeconomic changes, including growth in theurban middle class and disposable incomes, the recent rise ininternational retailing, and the possibility of global retailers

such as Germany's Metro and the French Carrefour, enteringthe Pakistani market. The entry of such firms has oftenresulted in profoundly altering the retail landscape,

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It is estimated that in 2002, about 6.8million of the 50 million people living inurban Pakistan belonged to the upper anduppermiddle class, and represented agrocery market worth $1.7 billion. Thissegment, projected to grow to 17 millionpeople by the year 2010, is expected to be

the first to switch to modern retail stores.

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The big player in the consolidating gametoday is Portland-based Fred Meyer Inc.Taking a major leap forward, Fred Meyeracquired Smith's Food & Drug Centers in Salt

Lake City during the summer. This created afood, drug and apparel chain of 265 storesoperating in 11 states throughout theNorthwest, Intermountain and Southwestregions with annual 1997 sales estimated at$7 billion.

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Benefits

?

Disadvantages

?

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