Market and Product Diversification: The Evidence From Retailing

This study explored the number of international regions in which retailers operate, the assortment of product categories they offer their customers, and the effects of these market and product category diversification strategies on retail sales volumes. The analysis used sales data about 246 global large-scale retail stores from diverse industries and countries of origin. We found that both strategies have positive effects on retail sales volumes. The two strategies interact such that the positive effect of market expansion on retail sales volumes is larger for retailers who also follow a strategy of greater product category diversity.     

Japanese retailers in Southeast Asia: strong local partners,shopping malls,and aiming for comprehensive internationalization

Japanese retailers have a long and mixed history in Southeast Asia with a period of expansion in the 1980s and 1990s being followed by a long period of decline and stagnation. Recently, some Japanese retailers have renewed their interest in Southeast Asia. Based on an overview of the major retail trends in Southeast Asia and identification of those Japanese retailers that are currently expanding in the region, this article develops propositions about the underlying factors and processes. It argues that the interest in Southeast Asia, while being mostly justified by retailers through reference to the growing middle-class populations in host countries, is as much based on developments in Japan itself, such as the saturation and stagnation of markets and the emergence of exportable, flexible, and comprehensive business models. Japanese retailers are intensifying activities at a time when strong domestic companies with retail interests have established themselves in host countries and therefore partnerships with them seem to fulfill more than the need to comply with investment regulations or deal with complex environments. Shopping malls play a role as locations for specialty stores but are also transplanted from Japan. Companies are making efforts toward more comprehensive internationalization and this involves human resources in headquarters in Japan as well as working together with other Japanese companies, thus satisfying the need for local embeddedness but at the same time maintaining corporate identity and advantages.     

Retail corporate groups: Challenges of omnichannel management in Japan

Abstract

The omnichannel varies across countries due to different retail environments and retailers’ growth strategies. The Japanese big retailers’ omnichannel can be characterized by having multiple retail formats, such as department stores, general merchandise stores, convenience stores, specialty stores, Internet stores, and so on. They have grown by multiplying retail formats to appeal to different customer segments, and they have unique challenges in managing an omnichannel with many retail formats. These are (1) extremely wide variety of merchandise, (2) enormous quantity of data from transaction, inventory, logistics, and customers, (3) different organization structures and management, and (4) unique organizational capabilities in each retail format. From these challenges, we could propose further research issues as follows: (1) theoretical consideration of boundary-spanning functions among retail formats, (2) international comparative analysis reflecting the different conditions in each country, and (3) clarifying the characteristics of the omnichannel shopper in the Japanese omnichannel environment.     

Flatlined: Combatting the death of retail stores

The recent wave of retail bankruptcies as well as poor sales performance has resulted in a large number of store closings. Low sales in store-based retailers can also be attributed to the rapid growth of web-based retailers (largely, Amazon) as well as an excess of store space per capita in the U.S. as compared to other developed nations. Strategies to stem the decline of retail stores include: (1) utilizing omnichannel-based synergies among channels and devices to increase store sales; (2) making stores more attractive and engaging through personalization, interactivity, and a constantly changing environment; and (3) improving productivity through introducing small-size store formats and downsizing existing stores.     

Modifying Conjoint Methods to Model Managers' Reactions to Business Environmental Trends: An Application to Modeling Retailer Reactions to Sales Trends

This article proposes and demonstrates how conjoint methods can be adapted to allow the modeling of managerial reactions to various changes in economic and competitive environments and their effects on observed sales levels. Because in general micro-level data on strategic decision making over time are difficult and expensive to obtain, this approach can be of much value to the further study of managerial strategic behavior and market dynamics. In our application we model retailer reactions to changes in their sales, focusing in particular on the actions that affect the demand for retail space and possibilities to improve retail sites. Choice responses to hypothetical sales and environmental trend scenarios are collected from 183 retailers and used to estimate to logit regression model that predicts retailers' probabilities of choosing actions. The model results confirm that retailers are more likely to take action when sales go down than when they go up, and also that they react more quickly if sales go down. It is also found that retailers are more reluctant to change the positioning of their store when confronted with a sales increase than when confronted with a sales decrease. The model is compared with a non-experimental model that is based on retailers' reactions to the trends they report to have observed for their own stores. The article concludes with a discussion of the implications of this research for the further development of conjoint-like approaches to studying entrepreneurial behavior.     

The International Activities of Japanese Retailers

Despite the upsurge of academic and commercial interest in the changes taking place in the retail sector within Japan, little has been published on the international activities of Japanese retailers. This paper illustrates the range and scale of activities.which have been undertaken by such companies. While Europe and America were favourite destinations up until the mid-1980s, most Japanese retailers have now refocused their expansion plans on Asia as the level of consumers' disposable income has risen and trade barriers have been lowered. At the same time, the early entrants into international markets, the development stores, have been joined by companies operating supermarkets, convenience stores, clothing stores, electrical outlets and so on. The paper considers the nature of these changes and the factors which have driven them.     

The Economic Effects of Repealing Fair Trade Laws

Legislation in 1976 abolishing fair trade appears to have led to limited price cutting among retailers. In particular, stores identified by their managers as being “discount” outlets were found to have undercut the prices of other stores in most product groups while the pricing policies of chain stores and multi-line stores have not become more aggressive on fair trade items since repeal. Limited evidence indicates that a reduction in nonprice competition in the form of newspaper advertising and sales personnel has also attended repeal. Finally, a substantial increase in the frequency of business failures in fair trade states during 1976 indicates that a consolidation among retailers may have coincided with the abolishment of uniform, manufacturer-specified retail prices.     

The ‘online high street’ or the high street online? The implications for the urban retail hierarchy

The U.K. has the greatest proportion of online sales in Europe. This study seeks to explore the differential effects of online retailing on the (evolving) hierarchy of shopping centres by examining current trends and underlying forces. The overall objectives of the paper are to qualify and explore the influence of online retailing in the decision-making processes of leading retailers today; and to assess how virtual influences become manifest in the tangible built environment and have impacted the retail hierarchy? It differentiates online retail trends by sector and retailer size, and examines the consequences for different types of shopping centres. The empirical research is based on the changing location of stores of a major fashion retailer and interviews with three of Britain’s leading retailers that have seen the more substantial increase in online turnover in recent years. Major retailers are found to have integrated online offerings, such as click and collect, into a ‘multi-channel’ retailing approach. Online retailing has therefore become an inherent and central element within large retailers’ business and therefore real estate strategies, with considerations such as online marketplace penetration and possible ‘cannibalisation’ coming to the fore in decision-making about store location. Online retail sales are, to a degree, drawing sales away from shopping centres but its impact on the existing shopping hierarchy is largely to reinforce established long-term trends driven by the motor age and the shift to out of town retailing. This is symbolised by the largest ‘high street’ fashion retailer now having more branches in retail parks than town centres. Out of town shopping centres for example are benefitting because of the ease of goods collection offered by these locations.     

The key role of intermediaries in Thailand's fresh food distribution system

New overseas retail formats have been entering emerging markets since the late 1990s. Accordingly, research on the advance of transnational retailers into emerging markets has recently flourished, and Thailand, one of the most popular host countries for transnational retailers, has often been examined as a case study. Many of these studies clarify the retail internationalization process and conclude that the new formats are driving the host countries' traditional distribution system toward a fundamental change. Although these studies consider the host countries' circumstances, they do not necessarily pay sufficient attention to specific characteristics of those host countries. In case studies of Thailand, the specific roles of intermediaries throughout the entire retail and distribution system are commonly overlooked. This paper argues that intermediaries continue to play an important role in Thailand's distribution systems, especially in the system of fresh vegetable distribution. This study first explains why earlier studies often attached less importance to the examination of intermediate distribution systems, despite the necessity of considering the roles of intermediaries for a deeper understanding of the impact of new retail formats on the host countries' distribution system as a whole. After discussing the key roles of intermediaries in Thailand's vegetable distribution system, this paper concludes that because modern retailers' involvement, particularly that of transnational retailers, at the agricultural production stage is still limited in Thailand, they often rely on intermediate distributors, such as local assembling wholesalers, coordinator-type intermediaries, and wholesale markets, for the intermediate distribution process.     

Expansion of Japanese Retailers Overseas

Abstract

There have been a number of studies of foreign retail entry into Japan but few that consider the moves of Japanese retailers to other Asian countries. Nonetheless expansion into Asia of Japanese retailers, notably since the early 1990s, has been considerable. Many have been attracted by the large size of several national markets. Large Japanese trading houses have played a significant direct and indirect role in the international moves of Japanese retailers. China has become the major place of investment for Japanese retailers with 21 retail companies established by Japanese firms. The history of the internationalisation of Japanese retailing shows three phases of development. A first phase is characterised by department stores, a second phase is a slowing of activity in the late 1990s and a third phase of rapid expansion is presently evident. The key to the current phase is the establishment and strength of non-retail supply firms in the same East Asian region into which retailers wish to expand.     

Retail Salespeople's Training and Its Impact on Attitudes Toward Handling Consumer Complaints

Abstract

This paper reports the results of a study of retail salespeople's training and its impact on attitudes toward consumer complaints. A sample of 59 retail salespeople from a variety of retail stores were surveyed via a self-administered questionnaire.

Significant differences were found between salespeople with more formal training and those who received informal/no training when they were hired into the sales positions. Findings indicate that proper training can equip salespeople to deal with customers who complain.     

The influence of social capital on local retail patronage in an urban setting

Local retail stores are currently facing intense competition from both online retailers and large chain stores. An understanding of local retail store patronage (i.e., patronage of retail stores in one's own community) is essential to the survival and growth of local retailers. Drawing on Social Capital Theory, we theorize and show with store-level survey data the influence of social capital (community attachment and reciprocity) on local retail store patronage in a large urban setting. We find that the impact of social factors differs for residents within the community compared to those outside of the community. We also demonstrate the importance of social factors in comparison to non-social factors. These findings contribute to the literature by extending the impact of social capital on local retail store patronage beyond rural settings, providing insight into urban consumers' decision to patronize local retail stores, and highlighting the impact of community boundaries. These findings also generate practical recommendations for local merchants and stress the importance of building reciprocal relationships with local customers as well as varying communications across community boundaries.     

Consumer satisfaction in retail stores: theory and implications

The substitution of small retail stores by the large stores has been a topic of debate among academics, practitioners, retailers and general public, especially in the context of foreign firms entering emerging markets such as China and India. The purpose of this research is to find out the determinants of consumer satisfaction in small and large retail stores in an emerging market, with a sample from India. Data were collected using a 39‐item structured questionnaire developed by the authors. The sample consists of 225 consumers who shop at retail outlets (Convenience sample of 125 consumers from small and 100 consumers from large stores respectively). Exploratory factor analysis grouped the 39 variables into 14 factors. Further, regression analysis revealed that six of the factors (Social desirability, staff friendliness, shopping economy, shopping ambience, family shopping and deal proneness) were major predictors of consumer satisfaction as they were found to be significant at 5% level. The significance of factors such as social desirability and staff friendliness imply that many consumers prefer those typical features of small stores, which in turn results in the likely coexistence of small retail formats in spite of the entry and proliferation of large retail stores from different countries. We posit three theoretical propositions to stimulate further research in this area.     

“互联网+”还是“回归实体”？——消费模式与零售企业战略选择

互联网与移动互联网技术迅速发展，带动了许多实体零售企业投身于电子商务的创新实践，但也不乏亚马逊、阿里巴巴等网络零售企业通过投资、并购等方式积极涉足实体零售企业。文章试图解释企业进行不同战略选择的原因，采取“互联网+”或是“回归实体”的依据。在分析互联网对零售企业影响的基础上，文章建立了包括消费者与零售企业在内的一般均衡模型，分析了消费者选择不同零售企业的依据，以及零售企业的应对之策。分析结果表明，消费者在不同零售商店的相对支出比例取决于零售商店提供服务组合的相对效率。因此，基于“有限商圈”与“有限品类”的经营战略成为企业扩大销售收入的关键，现网络零售与实体零售战略选择本质上可以归纳为品类专业化与区域专业化之间的收益比较。     

Two Studies on Using Specialty Advertising in Retail Sales Contests

Two studies were conducted to assess the impact of specialty advertising as a promotional tool in retail sales contests. In both cases, specialty advertising was directed toward the retail sales force rather than the consumer. It was felt that s~ecialtv advertisine could perform a reinforcement and reminder role as well as a mot: vating role for encouraging retail salespeople to participate in a contest. In the first study with Chick-fil-A, specialty advertising had an overall positive impact on employee performance. Total sales vol- ume increased in three of the four stores studied, while it increased in only two of the four stores that did not receive specialty advertis- ing. And while sales volume as a whole increased during the contest period, the largest percentage of increase occurred in those stores where specialty advertising was used. In the second study, the FanFair study, the effectiveness of spe- cialty advertising was very apparent. In both markets where special- ty advertising was used, Dallas and Phoenix, sales increases in graphics-the contest'objective-far exceeded total store sales. In the market where specialty advertising was not used, Milwaukee, sales of graphics were down much more than total store sales. Specialty advertising was found to be particularly cost effective in the Dallas market, where profitability far exceeded the cost of the specialties.     

Manufacturer-owned retail stores

Increasingly, manufacturers sell their products in their own retail stores, and many of these stores appear to be in direct competition with independent retailers; i.e., both types of retail stores are physically co-located. We analyze one way this practice affects the retail market. We find that, when independent retailers compete against company stores (instead of just against other independent retailers), they (1) charge higher prices and (2) are more willing to engage in marketing efforts on behalf of the manufacturer’s brand. Furthermore, when company stores and independent retailers compete in the same market, the company store charges higher prices and provides more marketing effort. Anecdotal data are consistent with these model predictions.

Measuring retail performance in an omni-channel world

Abstract

Driven by global advances in technology and changes in consumer buying behavior, brick-and-mortar retailers are being forced to become omni-channel retailers. This calls for new metrics for evaluating retail performance. We examine the challenges facing the retail industry, the metrics that traditional brick-and-mortar stores have used as well as the new metrics that retail industry experts are suggesting for online retailing. A conceptual framework for omni-channel retailers is suggested.     

Turning regulation into business opportunities: A brief history of French food mass retailing (1949–2015)

Abstract

The French retail market stands out among its European counterparts as being more concentrated. Relative to its neighbors, it has a higher number of large stores, such as hypermarkets. This article explains the origins of this market structure by assessing the impact of regulation on the French food retail industry between 1949 and 2015. Despite legislation aimed at curtailing their growth, retailers were able to circumvent legal constraints. Over the period considered, three ‘regulation-adaptation’ loops are described. Retailers’ responses to regulatory regimes affected both their bargaining mechanisms with suppliers and the business models they used to sell their products. By turning regulation into business opportunities, French retailers have managed to create a powerful oligopolistic industry, and are now among the largest retail groups in the world.     

Making working in retailing interesting: A study of human resource management practices in Danish grocery retail chains

This paper discusses how five retail chains in the Danish grocery industry attempt to make low-wage, low-status store-level retail jobs as checkout operators and sales assistants interesting. It does so from the perspective of both retailers and employees. Following analysis of the social and institutional context of Danish grocery retailers, we identify three types of retail employees (transitional workers, core employees and career seekers), who have different motivations and aspirations for working in grocery retailing. The central challenge for retailers is to make store-level retail jobs interesting to the different employee types. Although retailers mainly focus their attention on career seekers, we find that working in retailing is interesting for all employee types because the retailers are currently able to meet their respective motivations and aspirations. Nevertheless, we identify several areas in which retailers can improve their practices.     

Big-box retailing and the urban retail structure: the case of the Toronto area

This paper examines the growth and impact of power centres and “big-box” retailers through the 1990s in the Greater Toronto Area (GTA). The data reveal that 72% of big boxes were added in the previous nine years and that twice as many opened in the suburban fringe as compared to the equally populated central area. Of all big-box locations, 59% are on industrial lands and close to expressways. Of all postal codes in the GTA, 11% account for 47% of the big-box locations and a 19% versus 7% of 1989–1995 sales growth. Average annual sales per store in the heavily dominated big-box areas is $2+million versus $1.4 million in non-box areas and market shares for the dominant big-box retailers range between 19 and 33% in their respective retail categories. In eight retail sectors in direct competition with big-box retailers, there is an overall decline of −7% in share of total stores. Between 1993 and 1997, the proportion of retail employment within 2 km of a big-box increased from 28 to 43%. This increase is accounted for by additional retail and service firms.