Retail - General

Retail is the direct sale of products from a fixed location to consumers. A retailer buys products in large quantities from manufacturers either directly or through a wholesaler and sells it in smaller quantities to customers. It is one of the biggest industries in Australia and contributes to a big portion of the economy.

Retail pricing comes in two ways: cost-plus pricing which involves a markup amount to the retailers cost; and suggested retail pricing which involves charging the amount suggested by the manufacturer which is usually printed on the product.

Products generally range from food products, appliances, electronics, furniture, sporting goods, clothing, fabrics, and many other things. Retail can also be applied to certain services such as electric power.

The different retailers most commonly found in Australia include:

• Department stores
• Discount stores
• Supermarkets
• Warehouse stores
• Variety stores
• Specialty stores
• Convenience stores
• Malls

Retailers have also made use of the advantages of the internet in selling products directly to customers. Many websites allow customers to shop and order online and the merchandise will be delivered to the customer's preferred shipping address. The disadvantage of this type of selling is that customers have no way of determining the condition of the product until they have received it.

Retailers often have return policies whenever customers are not satisfied with the product or if defective. There is a grace period of a few days to a week before the item can be returned or replaced. However, clothing retailers require products to be unwashed before being returned.

The retail industry is supported and maintained by the cooperation of several retail associations such as the Australian Retailers Association, the national organization for retailers in the country with several other divisions in different states and territories; and other organizations such as the National Retail Association and the Australian National Retailers Association, which also represent a big portion of the countrys leading retailers.

Tips when opening your own retail store

Know the customer before you consider a location. More established retailers have made use of customer and location profiles by combining several elements such as historical customer sales data and shopping demographics. Retailers can make use of free data sources and create a grading system based on elements such as accessibility, population, household income, traffic and visibility.

Choose a location where the sales will be highest. Factors such as heavy traffic and the household income must be taken into account. The affordability of the rent must also be considered by knowing the current leasing markets. It pays to have several options if lease negotiations on the first location fail.

Know the different businesses that are within your location as it can determine whether the retail business will succeed or fail. Smaller retails usually benefit from foot traffic generated by bigger retails.

Before deciding on the location of the retail business, know the landlord. Retail lease terms generally are from five to 10 years, creating a long term relationship between landlord and tenant. It is advisable to research on the track record of the company and the landlord.