Page 126 - DMGT552_VISUAL_MERCHANDISING

Unit 6: Store Planning and Fixtures

conducting store’s situation analysis, normally study in the context of external environment and Notes
internal environment.
External Analysis: The purpose of examining the store’s external environment is to study the
opportunities and threats in the retailing environment. The external analysis studies factors that
affect the macro-environment of the retailing industry and the task environment. Under external
analysis retailer studies these parameters:
1. Economic Environment of Retailing
 Inflation

 Employment
 Disposal income
 Business cycle

 Energy availability and cost
 Others
2. Political/Legal Environment of Retailing
 Monopolies legislation
 Environmental protection laws

 Taxation policy
 Employment laws
 Government policy

 Legislation
 Others
3. Socio-cultural Environment of Retailing
 Demographics
 Distribution of income

 Social mobility
 Lifestyle changes
 Consumerism

 Levels of education
 Others
4. Technological Environment of Retailing
 New discoveries and innovations
 Speed of technology transfer

 Rates of obsolescence
 Internet
 Information technology

 Others

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