CHAPTER 3: STORE-BASED AND NON-STORE-BASED STRATEGY MIX

    

Figure 1: The Wheel of Retailing

      From the Wheel of Retailing above figure, there are many lessons that we have to always beware. First, we cannot lose sight of our prime customer’s price consciousness. This is because the customer always conscious about the low price at the low end strategy of the business. Second, beware of the dangers in upgrading target markets. These are because a few risks might be faced as the old segment gets “sticker shock” and new segment does not accept retailer’s revised positioning immediately. Third, the company can employ customer benefit costing to weigh the cost and benefits of specific service upgrades. For example, the company can offer the price that includes the delivery cost towards customer but with the benefit that the parcel can be receive on time to the customer.

Figure 2: Scrambled Merchandising
by a Shoe Store

 The scrambled merchandising have a few reasons why it is very important on the performance of retail strategy mixes. These are because it is desired for one-stop shopping format by customers. Besides that, it concerns to adopt “hot” products to increase store traffic where people are eager to purchase something that are trendy. In addition, it is looking for high gross profit businesses where the retailer sells a variety of products that are easily found by customer in one store only.

   Moreover, the retail life cycle also can help in the performance of retail strategy mixes. In retail life cycle, any retail institutions have to pass through identifiable life stages which are:

•          introduction

•          growth

•          maturity

•          decline

Figure 3: The Retail Life Cycle

  Furthermore, there are a few ways that retail strategy mixes such as retail institutions are evolving through mergers, diversification, and downsizing, cost-containment and value-driven retailing. Mergers are the combinations of separately owned firms. For example, Coca-Cola and Pepsi. Meanwhile diversification which retailers become active in businesses outside their normal operations. Besides, downsizing is unprofitable stores are closed or divisions are sold off.

   In addition, there are a variety of food-oriented and general merchandise retailers involved with store-based strategy mixes.

Food-Oriented	General Merchandise
• Convenience store • Conventional supermarket • Food-based superstore • Combination store • Box (limited-line) store • Warehouse store	• Specialty store • Traditional department • Full-line discount store • Variety store • Off-price chain • Factory outlet • Membership club • Flea market

Table 1: Store-Based Retail
Strategy Mixes