ACTIVELY SHARE, RETAIL DEFINITION — The retail business has tremendous profit potential. Understand what retail is and its characteristics so that the business runs as expected.
In today’s era of increasingly rapid economic development, of course you have heard quite often about the retail business.
It could even be, you want to start your own retail business today. If so, have you understood and understood more deeply what retail is and its functions?
What is a Retail Business?
Before talking further about the retail business, it is very important for you to know what retail business is clearly and accurately to get a complete picture of this business before getting directly involved in it.
Basically, retail business is a business that involves selling goods or services to consumers in units or retail.
Consumers who buy products or services in retail are intended to consume them or use them personally and do not resell them.
The retail business is different from the wholesale business. Retail business consumers do not resell the products they have purchased, while wholesale business consumers resell the products they have purchased.
This has a major impact on the prices of goods offered at retail and wholesale levels.
So how does the supply chain in the retail business work? Of course you must understand this if you want to get into the retail business.
The retail business’s supply chain consists of producers, wholesalers, retailers, and consumers.
Manufacturers are directly related to the wholesale business, then the wholesale business sells to retailers, then retailers resell it to consumers who use the product directly.
Retail Business Function
Being the last part of the product supply chain provides its own function for the retail business.
To become a successful retailer, understanding the functions of the retail business is crucial. Here are some of its functions in general.
1. The spearhead of product marketing
The main function of the retail business is to be the last part of the supply chain of goods from producers to consumers.
The retail business function is very important to keep producers focused on producing goods without being distracted by the many efforts that must be made to deal with consumers who want to buy products for consumption.
Without a retail business, manufacturers have to think about how to produce products that can compete with other products while dealing with consumers.
This can disrupt the production process and disrupt the availability of goods.
2. Make it easier for consumers to get products
The retail business also functions as an intermediary to make it easier for consumers to buy goods.
Just imagine if when you need an item you have to buy it from the factory first, of course it will be very inconvenient.
How many factories should you visit if you want monthly shopping?
This is where the retail business functions to make it easier for consumers to buy goods individually and provide various types of goods in one location.
3. Help product promotion
Another important function of retail business is to offer products to consumers to the maximum.
That’s why any type of retail business always has a sales force or sales marketing, customer service, and product catalogs.
The retail business does not only sell goods, but also includes promoting goods and educating consumers about the products it sells.
4. Observing the market
Because the retail business is directly related to consumers, retail is also the spearhead to find out consumer behavior and market trends.
Retail businesses get direct feedback from consumers, so retail businesses can return them to wholesalers or producers. Thus, the sustainability of the product can be maintained.
Retail Business Characteristics
Understanding well what a retail business is and knowing exactly what it does does not necessarily make someone able to run a retail business well.
If you really want to get into the world of retail business, you need to understand the characteristics of the retail business as a whole.
By fully understanding the characteristics of a retail business, you can think of the right strategy to get started.
Here are some important characteristics of a retail business that you must know before starting a business.
Even when the business is already running, you can make changes and adjustments to ensure the continuity of your business.
1. Retail business sells goods in units
In selling goods, retail businesses do it in units. Therefore, it is very important to pay attention to how to promote goods to attract buyers.
How to promote goods must also be able to explain the features and advantages of the product in question, either clearly and at length, or briefly, concisely, and clearly.
Because they sell goods in units, retail businesses must also provide stock for consumers.
An important key to providing stock is how retailers can provide goods whenever consumers need them.
2. Retail business dealing directly with consumers
As the end of the supply chain, the retail business will face and deal directly with consumers.
Retail businesses need to have a product payment system and process that is not complicated, fast, and easy.
Many retail businesses provide more services in reaching consumers such as providing offline and online stores, shopping consultations, and many other extras.
3. Retail business has various types according to consumer needs
With the characteristics of the retail business that serves consumers in massive numbers and often involves many products in it, the retail business is automatically divided into various types.
Here are the types of retail businesses that you need to know:
1. Convenience store
It is called a grocery store because this type of retail business provides many product categories which are generally intended to meet the daily needs of consumers.
Some of the product categories available include fresh food, canned food, snacks, drinks, cosmetics, kitchen needs, bathroom needs, and other household needs.
Physical examples of convenience stores are department stores, supermarkets, mini-markets, and so on.
2. A specialty store that sells only one type of product or service
In addition to convenience stores, there are also specialty shops or stores that only sell one type of product or service—though sometimes it’s not limited to just one brand of product.
This retail business model usually has a narrow but focused range of categories. Some examples are repair shops, car showrooms, restaurants, drug stores, toy stores, jewelry stores, clothing stores, and many others.
3. Non-store retailers
Advances in technology, especially in the field of communication and the internet, have resulted in a new type of retail business that continues to grow every day, namely non-store retailers.
Those who are in the non-store retail business use email, websites, mobile applications, and even telephones to sell their retail products.
Profitable Retail Business Inspiration
The retail business has great potential considering that the market is individual consumers, which continues to grow all the time.
It is these consumers who determine which retail business trends are in demand and have the most lucrative potential.
Well, here are some retail business inspirations that have the potential to bring big profits if they are handled well to the fullest.
1. Coffee shop
It is no secret that this retail business is booming and is always in demand by consumers.
The proliferation of coffee shops in almost every city in the world is an indicator that this business has great potential.
It doesn’t matter whether it’s a small coffee shop business to a franchise coffee shop, the consumer’s need for coffee as part of a lifestyle makes this one retail business to be considered.
2. Online retail
For those of you who are observant to see the potential of the online or online market, then you will realize that the online retail business has very, very large potential.
With the number of internet users in the world that continues to grow, the potential for selling goods or services online is even more promising.
The online retail business relies on the interaction of sellers and buyers through a user interface either through a PC or smartphone.
In fact, even with very limited capital, you can start selling by joining through the large marketplaces that are widely available.
3. Laundry service
The lifestyle of today’s urban communities is getting busier, leaving not much time to do household chores. Unfortunately, not everyone is able to accommodate the use of domestic helper services to overcome this.
Laundry services are one of the quick and easy solutions that answer these needs.
That’s why the franchised laundry service retail business has great potential, especially in big cities in Indonesia.
There’s no need to be complicated about the strategy and system, because you just have to follow the rules provided by the franchise.
The growth of the automotive industry which increases every year has a positive impact on retail businesses such as workshops and the like.
More and more vehicles on the road need maintenance, and repair shops are the answer. Indeed, the biggest obstacle in the workshop business is its business capital.
However, you don’t need to worry because there are many banks that can provide capital assistance funds that can be paid in light installments.
5. Beauty clinic
The demand for maximum appearance makes many people do not hesitate to flock to beauty clinics to get facial and body treatments.
This condition presents a high profit potential in the beauty clinic retail business.
There are many beauty clinic franchises that you can choose from.
Usually, each beauty clinic also has its own products that can be sold. Thus, your profit potential can be doubled.
6. Gadget shop
Technological developments also have an impact on the electronics industry, especially gadgets.
Every day, there are many new technologies that are developed and embedded in gadgets such as smartphones, cameras, watches, and others.
That’s why the retail business selling gadgets has a very high profit potential. With the launch of new smartphones every year, consumers certainly want to change smartphones.
You could say, the potential benefits are routine and never-ending.
Starting a retail business requires careful planning and sufficient capital. With a good understanding of the retail business, you will be able to make a mature business plan.
Even better if it is supported by sufficient capital. Don’t hesitate to apply for a capital loan from a trusted bank so that your retail business runs well.