Page 75 - DMGT550_RETAIL_MANAGEMENT

Retail Management

Notes 4.5 Summary

 Each retailer is using his own buying systems which often is hard to understand for new
suppliers.

 Research suggests that customers go through a five-stage decision-making process in any
purchase.

 The buying process starts with need recognition.
 The first task starts with gathering market information and identifying the suppliers who
may be available locally or overseas.

 On successful submission of trial samples and acceptance by the buyer and the buyer
being convinced of the intent, capability and quality of the supplier engages the supplier
into commercial negotiations.
 Buying decision differs from person to person.
 Purchases for high priced electronics, such as a television, computer or camera, or major
purchases such as a home or car require consumers to use extensive decision making.
 Secondary groups share indirect relationship with the consumer.

4.6 Keywords

Complex Buying behavior: This situation involves the high level of involvement from consumers
and the same with the difference among brands.
Dissonance reducing behavior: This involves high involvement of the buyer but a less significance
difference among the brands.

Extensive Decision Making: Purchases for high priced electronics, such as a television, computer
or camera, or major purchases such as a home or car require consumers to use extensive decision
making.

Habitual Buying Behavior: Here there will not be any kind of involvement from the consumer.
Impulse Purchases: When a consumer stands at the checkout and notices lip moisturizer, magazines
and gum, and adds one of the items to his cart of groceries, it’s often referred to as an impulse
purchase.
Limited Decision Making: When customers engage in purchases that require limited decision
making, they may seek advice or a suggestion from a friend.
Routine Purchases: There are items consumers are used to purchasing every day, once a week or
monthly. These can range from a morning cup of coffee from a nearby convenience store, to
milk, eggs and cheese from the supermarket.

4.7 Review Questions

1. Describe the act of retailing. Why do you think retailing is important?
2. “Retailers provide a collection of service benefits to their customers.” Substantiate.
3. Discuss the functions of retailing with the help of suitable examples.

4. Discuss the social and economic significance of retailing.
5. Explain the structure of retailing and distribution.

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