A walk down any neighborhood mall or downtown shopping area is sufficient to establish the fact that the retail business is here to stay. From automatic vending machines to supermarket chains, from everyday groceries to specialty and luxury goods, there’s a retail business selling almost everything.
Retail Spells Convenience
Whether you want to stock up your monthly grocery, get a designer wear for an event, give your home a make-over or purchase the latest mobile phone, there’s a retail business out there that will
most certainly meet your requirement. In addition, the Internet has proved to be a boon to both retailers and consumers. With an online store to augment their brick and mortar business, retailers
can reach out to consumers even without having to get them to come to their store. For consumers, the Internet provides an almost real shopping experience from the comfort of their home.
Starting a retail business involves sourcing goods from a wholesaler or a manufacturer and bringing price that contributes to the retailer’s profits. Just like finished goods, even services can be sold through a retail business such as retailing holiday packages, banking services, property management services etc. With bulk purchases from wholesalers or manufacturers, a retail business venture is often well equipped to pass on huge discounts and attractive deals to the consumers.
Retailing as a Reliable Business Model
There was never a better time for retail businesses worldwide despite the mostly sluggish economy. Today, retailing is one of the rapidly growing sectors of the economy contributing to increased
consumer spending. There are several factors that work in favour of a retail business model. Some of these factors that make retail businesses appealing to both entrepreneurs and consumers are as follows.
Wide range of goods and services to sell through a retail venture
Easy access for an entrepreneur to established trademarks and brands by way of franchising. Quick decision-making in terms of declaring holiday discounts, bargains and gifts for
consumers. Increased consumer orientation in terms of selection range, customer service, quality of goods etc. Easy to gauge consumer preferences and study consumer behavior to improve goods and services.
An interesting advantage for an entrepreneur who is seriously thinking of starting a retail business is that there are several well-established enterprises to learn from. World renowned businesses like Wal-Mart and Best Buy have been long enough in the business as retail success stories that would inspire anyone wishing to make a foray into the billion dollar retail industry. Although there’s no guarantee that every retail business will be just as successful, for the businessman willing to take some risks, the prospects are quite encouraging. Many retail businesses have greatly benefited from replicating the business model of successful players such as Wal-Mart.
Just like any venture, there are pros as well as cons to setting up a retail business. A careful examination of the business idea, inventory sourcing and management (for goods retail), skilled labour availability (for retail services), the potential market and the entrepreneur’s risk appetite are some of the important considerations.
A phenomenon like recession can even bring giants like Wal-Mart down to their knees and therefore, preparing for such contingencies and surviving against all odds will bring long-term success to a retail business. A solid business plan, the right attitude and proper risk management plan will be the cornerstone of a successful retail business.