Retail merchandising involves selecting products, determining their retail price, setting up displays, and marketing to potential customers. It is important to establish good relationships with manufacturers, offer quality products at reasonable prices, and use effective advertising strategies.
Retail merchandising is the process used to conduct retail sales. As part of the process, the merchandiser pays close attention to the types of products being offered for sale, how best to present those products to consumers, and determining what a reasonable retail price is for each unit sold. While retailers have traditionally engaged in the task of retail merchandising in a physical location, the internet has now made it possible to apply these same basic principles in a virtual environment.
The first important step in retail merchandising is establishing working relationships with the manufacturers who will supply the goods or services that are ultimately sold by the retailer. This type of retail shopping involves determining which products will be transported to the retail establishment, negotiating the unit price that will be charged by the manufacturer, and arranging for delivery of those goods. Depending on how many units the dealer can afford to buy at any given time, it can be relatively easy to get a discounted unit price, making it easier for the dealer to compete in the local market.
Once the goods are warranted, the retailer must determine the unit price he will assign to the products. In any event, this retail price will be higher than the cost of purchasing the goods from the supplier. It is this difference between the wholesale price and the retail price that allows the retailer to make a profit and stay in business. Some retailers follow a formula of setting the retail price at a fixed percentage above the acquisition price, while others base the retail price on factors such as the desirability of the items and the amount of competition from other retailers in the immediate area.
After setting retail prices, the retail merchandising process moves on to the activity known as setting and displaying. This process is all about displaying the goods within the retail to their fullest advantage. By using fixtures such as storefronts, elevated platforms, and colorful backdrops to grab buyers’ attention, the retailer increases the chances of selling units quickly. Setup and display are often considered especially important with fashion merchandising and similar retail settings, as visual display is often the key means of attracting customers who are most likely to make a purchase. Quick sales lead to more profits and the ability to secure more products which will result in more sales.
Marketing is an important aspect of any retail merchandising strategy. Participating in an advertising campaign to reach potential customers can involve something as simple as advertising in local publications and electronic advertising on local radio and television stations. Direct mail is also a common strategy in retail, as mailings allow you to reach people in their homes and workplaces rather than relying on them to approach the retailer first.
To be successful with retail merchandising, you need to provide consumers with a couple of key benefits. First, the products must be of high quality; this helps ensure that the customer will come back for more purchases in the future. In addition to quality, the retailer must also sell the products at prices that the consumer deems reasonable. By providing quality products at affordable prices, the retailer has a better chance of standing out from the competition and staying in business for many years to come.
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