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Unit 3: Buying for Discount Operations

lines. Along with these merchandising generalists were the specialty discounters who limited Notes
their inventories to one product classification. The former group might be compared to the
full-line department stores that carry products for the entire family, while the latter somewhat
resembles the specialized department store that restricts its offerings to one broad line of
merchandise. Discounting is not only for major retail operations, but for small independent
merchants as well. The explosion in discount retailing has challenged many buyers and
merchandisers in terms of their purchasing expertise.

3.1 Classification of Major Discount Organizations

There are numerous types of operations within this retail classification. Although, their model
stocks differ from one another in terms of products and price points, their overall philosophies
are the same.

3.1.1 Merchandise Generalists

When one goes value shopping for a variety of family needs, he or she often heads to stores like
Target, Walmart, and Kmart, now a part of Sear Holdings since they merged with Sears. In those
premises one is able to purchase anything to satisfy both personal and household needs. Whether
it is clothing, shoes, jewelry, small appliances, house wares, electronics, or even garden products,
the assortments are there for the purchasing. Just as in the traditional chains and department
stores, there are separate departments that enable shoppers to find what they are ready to
purchase more easily. The different sections are clearly marked, making shopping a pleasurable
adventure.

Example: The Retail Buying Focus explores Target stores.

3.1.2 Specialty Discounters

With specialization the key to success for many traditional chain organizations, the discounters
have followed suit by opening retail chains that parallel the traditionalists, but offer discounts
on all of their merchandise. The different types of specialty stores include electronics discounters
such as Best Buy, furniture giants such as Rooms To Go, house wares and home furnishing
companies such as Linens ’and Things and Bed Bath & Beyond, toy merchants such as Toys A Us,
and home improvement centers headed by Home Depot and Lowe’s.
Specialty stores also offer well-known products at prices that are typically lower than the
traditional retail organizations.

Example: The Retail Buying Focus explores Home Depot.
3.1.3 Warehouse Operations

Somewhere between the merchandise generalists and the specialty discounters are
the warehouse operations. The former group sells a variety of hard goods and soft
goods and the latter restricts its offerings to one major classification of merchandise.

Notes The warehouse operation’s product mix falls somewhere in the middle.

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