Page 14 - DMGT550_RETAIL_MANAGEMENT

Unit 1: Introduction to Retailing

Self Assessment Notes

State whether the following statements are true or false:
10. Retail sector makes an important contribution to the GDP of a nation.
11. Retailers also act as gatekeepers.

1.6 Global Retail Market

Retailing is increasingly a global business. A more structured retail industry with more multiple
retailers (those with more than one outlet) is a sign that an economy is developing, as
organizations specialize and gain economies of scale. Additionally, when disposable incomes
rise, retailers play an active part in distributing increasingly discretionary goods to centres of
population. Emerging markets are a real (although highly complex) opportunity for experienced
retailers, especially if they are faced with high levels of retail provision and therefore competition
in their traditional markets.
As the artificial barriers to trade, such as import duty and quota restrictions, are removed from
the global economy, many retailers will view the world as their marketplace and make sourcing
and outlet operation decisions on a set of criteria that are relevant across the globe.

Example: In the UK some of the strongest recent entrants to the retail market are
non-domestic players, such as Wal-Mart, IKEA, Marks and Spencer’s, Big Bazaar and some
modern age retailers are having considerable success on a global basis, such as Tesco, B&Q,
Carrefour etc.
However, long distances, political and cultural complexities are huge challenges to retailers,
which can only be overcome by the strongest contenders. International retailing activities have
often stemmed from retailers seeing opportunities for formats that are under-represented in
new markets, such as the entry by the ‘hard discount’ supermarket operators (Aldi, Netto, Lidl)
into the UK in the early 1990s and Vishal Megamart, Big Bazaar, Shoppers’ Stop in India in the
late 1990s.

Did u know? Global retail development index is an annual study that ranks the top 30
developing countries for expansion worldwide. The index analyses 25 macro economic
and retail-specific variables to help retailer device successful global strategy to identify
emerging market opportunities.

Self Assessment

Fill in the blanks:
12. ........................ is the world’s biggest retailer.
13. ........................ is at the top of GRDI.

1.7 Career in Retail

Today, the retail industry is considered amongst the largest in India, and is ever-growing. This
is because as long as there are buyers, this industry will prosper. In the last couple of years, the
buying capacity of an average Indian citizen has increased. This is because of various factors;
prime amongst them is the large pay packets.

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