Retail Change

Retail Change

1. Shift in Power

   • Manufacturer to Retailer
     • Abolition of PRM in 1964
       • RPM made shops sell goods at standard prices set by suppliers and thus prevented price wars
     • Development of Retailer Brands
     • More access to Information
     • Change in Channel Power
   • Retailer to Consumer

2. Theories of Retail Change

   • Cyclical
     • Wheel of Retailing
       • Concept suggested by McNair (1958)
       • Three Phases
         • Entry Phase - Innovative retailer
           • Has Poor Facilities, Low Prices, Low Status, Limited product offerings and Minimal Service
         • IR becomes Traditional Retailer in the Trading up phase...
           • Elaborate facilities, Expected, essential and exotic services, higher prices more products and high rent
         • Vulnerability Stage - Mature Retailer
           • Top Heaviness, Decline on return on Investment
     • Criticisms
       • Doesn't set well with the 'post-modern condition' (Brown, 1995)
         • Post- modernists believe that history is a discontinuous, shapeless, fragmented and dependent
     • Cylical Theories are deterministic and inflexible and focus on patterns
   • Non Cyclical Theories
   • Brown (1987) observed that 'theory is a rather generous term for what have been described as little more than inductively revised generalisations'.
     • But there are lessons that can be learnt from history

3. Evolution of Retail Marketing

   • Retailers have taken control over all elements of the marketing mix
   • 'The middleman is not a hired link in a chain ...but an independent market, the focus of a large group of customers for whom he buys' McVey (1960)
   • Pommerering (1979) discussed european retail shifts
     • 1950's Manfacturer is King - Post war shortages place emphasis upon manufacturing and supply
       • 1960's 'Consumer is King' Competition brought more emphasis upon marketing and the development of manufacturer brands
         • 1970's 'Trade is King' More concentrated and Powerful retailing industry