Page 114 - DMGT550_RETAIL_MANAGEMENT

Unit 6: Financial Strategy and Retail Locations

 Convenience goods require easy access, allowing the customer to quickly make a purchase. Notes
 Specialty goods are more unique than most products and customers generally won’t mind
traveling out of the way to purchase this type of product.

 Trade area analysis and mapping describe the characteristics of the area around a store or
network of stores.

6.12 Keywords

Convenience goods: They require easy access, allowing the customer to quickly make a purchase.
A mall would not be a good location for convenience goods. This product type is lower priced
and purchased by a wide range of customers.

Exclusivity clause: This protects you by asking the landlord to agree to not place a competing
business in his center, or, if it’s a large mall, within so many feet of your business.
Retail Sales Potential: It provides estimates and projections of consumer potential organized
by store type.
Specialty goods: They are more unique than most products and customers generally won’t
mind travelling out of the way to purchase this type of product. This type of store may also do
well near other shopping stores.

Strategic Profit Model: The Strategic Profit Model is a crucial part of understanding how different
retail strategies can be used to pursue similar financial goals.

6.13 Review Questions

1. Describe the financial objectives and goals.

2. Explain the strategic profit model.
3. Describe the analysis of financial strength.
4. Explain about types of locations.
5. Discuss about location and retail strategy.
6. Explain the legal considerations.

7. What do you know about trade area characteristics?
8. Analyse the potential sales of a store site.
9. Discuss about negotiating lease.

10. Discuss about common area maintenance.
Answers: Self Assessment

1. Businesses 2. Strategic Profit Model
3. Return on Equity 4. Households
5. Customer Loyalty 6. Financial Ratio
7. Strip Malls 8. Business Park

9. Technology 10. Retailers
11. Organizational Environment 12. Location

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