Retail Trade

Retail trade refers to buying goods from the manufacturers or wholesalers and selling the same to the ultimate consumers. The retail trader generally deals in a variety of goods. Those who are engaged in retail trade are called retailers. Retailers sell goods in small quantities as per the requirement of consumers.

Characteristics of Retail Trade

Following are the characteristics of retail trade:

  1. Retail trade generally involves dealing in a variety of items.

  2. A retailer makes purchases from producers or wholesalers in bulk for sale to the consumers in small quantities.

  3. Retail trade is normally carried on in or near the main market area.

  4. Generally retail trade involves buying on credit from wholesalers and selling for cash to consumers.

  5. A retailer has indirect relation with the manufacturer (through wholesalers) but a direct link with the consumers.

Services Provided by Retailers

Retailers provide the following services to consumers and wholesalers.

1. Services to Consumers

Retailers provide the following services to the consumers.

  1. Regular supply of goods: Retailers maintain a ready stock of goods for sale to consumers.

  2. Convenient Location: Retail outlets are situated near residential area and remain open for long hours. The consumers can buy the goods from the retailers at their convenience.

  3. Wide Choice: Retailers stock wide variety of products. Consumers like to purchase everything under one roof. So retailers stock products of different companies providing wide choice to consumers.

  4. Home Delivery: Without any extra charge, some retailers supply goods at the homes of consumers.

  5. Consumer Education: When a new product comes in the market, retailer clearly explain the merits and uses of the product to the ultimate consumers.

2. Services to Wholesalers

  1. Market Information: Retailers supply valuable information to wholesalers about changes in tastes, fashion, etc. of consumers.

  2. Help in Distribution: Retailers relieve the manufacturers and wholesalers of the burden of collecting and executing a large number of small orders from various consumers.

  3. Large Scale Production: Retailers help manufacturers to operate at a large scale.

  4. Sell New Products: New products will be displayed in retail outlets in a attractive way so as to persuade consumers to buy these products.