UNIT C
THE BUSINESS OF
FASHION
3.03 Identify the types of
fashion retailers.
Main types of retailers
•General merchandisers
•Specialized merchandisers
General merchandisers
•Carry many types of goods in
several price ranges
•May be a rural general store or a
huge mass merchandiser
Specialized merchandisers
•Narrower lines of related
merchandise
•More distinct group of customers
•Market certain categories of
goods to particular age groups,
sizes, and consumer tastes and
preferences
•Examples: Victoria’s Secret,
Footlocker, Lane Bryant
Department store retailing
•Large-scale mass merchandisers
•Usually carry a wide range of sizes
•Carry household goods
•“Departmentalized” by category/sizes of
goods being sold
•Each department may have separate
salespeople and payment areas.
•Generally known for high quality, fashion,
and customer service
•Usually offer credit and return or exchange
privileges
Department store retailing (cont.)
•Offer numerous customer services such as gift
wrap, layaway, and restaurant(s)
•Sell to many income levels, but generally target
middle to upper income customers
•High operating expenses due to number of
employees and customer services
•Advertise heavily
•Large buying and sales volume
Types of department stores
•Branch stores
•Flagship stores
•Junior department stores
•Chain stores
Branch stores
Small retail stores owned and operated by
a parent store.
•May be located in suburbs or
other urban areas
•Receive merchandise and
operation instructions from the
original store
Flagship stores
“Parent” or main stores originally located
in a central business district.
•Responsible for merchandising and
promotion for entire operation
•Can make merchandise available to
branch stores on short notice
•Some flagship stores have closed and
moved administrative offices to other
locations.
Junior department stores
Small department stores with
limited assortments of apparel,
housewares, gifts, and household
textiles.
•Moderately priced merchandise
•Locally owned
•Low sales volume makes it
difficult for these stores to
compete.
Chain stores
A group of stores owned, managed,
merchandised, and controlled by a
central office.
•All stores carry similar goods at similar prices.
•Private label merchandise (Example: Kenmore,
Hunt Club)
•Decisions made at central headquarters
•Merchandise can be produced to the chain’s
specifications
•May serve as anchor stores
Anchor stores: The attractions that draw
customers to shopping centers and malls.
Discount store retailing
Discount stores: Mass merchandisers
that sell at lower-than-average prices.
•Located in large,
no-frills facilities in
high traffic areas
•High sales volume
•Offer minimal
customer services
•Many retailers are
making an effort to
offer more current
fashions.
•Merchandise is
paid for at
checkout counters
located near store
exits.
•Fashion followers
•Most discounters are
chains.
Discount store retailing (cont.)
•Extended operating hours
•Many imports from low-wage
countries
•Appeal to customers with
modest clothing budgets
Off-price discounters
Factory outlets
Off-price discounters
Retailers that sell brand name or
designer merchandise at lower-thannormal prices.
•High fashion goods at moderate
prices
•Changing and unstable collection
of merchandise
•Buy merchandise at belowwholesale prices
•Labels may be cut out to protect
merchandise sold in upscale
shops
Off-price discounters (cont.)
•Do not place advance orders
•Make low-cost special purchases during
the season when other stores are planning
for the next season
•Stock consists of production overruns,
end-of-season goods, closeouts, and
irregulars.
Factory outlets
Discount stores that are manufacturer
owned and operated
•Sell only merchandise
produced by the company
•Products sold include
overruns, canceled orders,
and discontinued items.
•May be located in factory
malls
Specialty store retailing
Specialty stores: Retailers that
sell limited classifications of
merchandise.
•Low sales volume
Franchise stores
•High prices
Boutiques
•Offer unusual
merchandise, more
personalized service,
convenience, and
ambience
•Known for a certain level
of design or quality of
merchandise
Franchise stores
Retail establishments in which a firm
or an individual buys the right to use a
famous or established name or
trademark in a specified trading area.
Franchise stores (cont.)
•Often located in exclusive
shopping areas of major
cities or boutique areas
within large department
stores
•The designer or
manufacturer does not have
direct ownership of the
franchise and does not help
run the business. They only
supply goods to the retailer.
Boutiques
Small, stand-alone shops or
areas within larger stores that
sell unusual, limited quantity
apparel, accessories, or
decorative items.
Boutiques (cont.)
•High level of customer
service
•Fashion-forward
merchandise
•Target special-interest
customers
•Unique images
•New, artistic, and
handmade items
Nonstore retailing
Selling without a conventional store
facility.
•Mail-order retailing
•Telecommunication retailing
•In-home selling
*Nonstore retailing developed for the convenience of
the consumer.
Mail-order retailing
Selling merchandise through
catalogs distributed to
customers.
•Customers select items by
looking at pictures and
reading product
descriptions.
•An alternative for customers
who prefer to shop from the
comfort of their home or
cannot go out to shop
•Orders are placed by mail,
toll-free calls, computer, or
fax.
Mail-order retailing (cont.)
•Merchandise is usually paid for by
credit card and shipped directly to
consumer.
•Extended order-taking hours
•May offer a full line of items or
specialize in a single line of
merchandise
•Many retail department stores and
chains offer catalog shopping.
•Many mail-order houses also have
retail stores.
•Customers usually pay high
shipping and handling fees.
Telecommunication retailing
Selling merchandise using
communication devices.
•Television retailing
•Computer
(Internet) retailing
Television retailing
•Television channels are used to
show and describe merchandise.
•Many celebrities sell signature
lines of merchandise.
•Consumers can control what they
view.
•Orders are placed by telephone or
online at the company website.
•Used to introduce and test the
market for new products
•Reaches a national audience
Computer (Internet) retailing
•Electronic retailing or “e-tailing”
•Combines computer and telephone
technologies with marketing and
merchandising
•Shoppers view merchandise on computer
monitors and order through a modem
connection.
•Allows customers to view “electronic
catalogs”
•Allows for comparison shopping
In-home selling
•Selling outside of a retail store
•Used to sell cosmetics, jewelry,
clothing lines, and other
merchandise through selling
parties or door-to-door sales
•Merchandise is often high quality
and unusual in design.
•Prices may be high.