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Chp4: Retail Institutions by Ownership - Coggle Diagram
Chp4: Retail Institutions by Ownership
Classification method
b. Store-based Retail Strategy Mix
Convenience store
Conventional supermarket
Food-based superstore
Box store
Warehouse store
a. Ownership
ii. Disadvantages
Lack of bargaining power
Lack of economies of scale
Labor intensive operations
Over-dependence on owner
Limited long-run planning
i. Advantages
Flexibility in formats, locations, and strategy
Control over investment costs and personnel functions
Personal image
Consistency and independence
Strong entrepreneurial leadership
c. Nonstore-based
Direct marketing
Direct selling
Vending machine
World Wide Web
Leased department
i. Definition
A leased department is a department in a retail
store that is rented to an outside party
Franchising
ii. Ideal Potential franchise
High personal integrity
Financial resources
A willingness to complete a detailed training program
A willingness to devote full time to day-to-day operations
The ability to manage finances
A proven ability to motivate and train people
An entrepreneurial spirit and strong desire to succeed
iii. Advantages
small capital required
acquire well-known names
operating/management skills taught
cooperative marketing possible
exclusive selling rights
less costly per unit
i. Definition
A contractual agreement between a franchisor and a retail franchisee, which allows the franchisee to conduct business under an established name
iv. Disadvanteges
oversaturation could occur
franchisors may overstate potential
locked into contracts
agreements may be cancelled or voided
royalties are based on sales, not profits