is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from suppliers to consumers.
Survey - Total Spent 2011 $52.5 billion 2010 $45.0 billion 2009 $41.2 billion 2008 $41.0 billion Source: National Federation of Retailers
Retailing as old as Civilization
Retailing goods or services goes back to the beginning of recorded history. Whether selling home-made wares at a marketplace, from a cart or servicing a community from a workshop, individuals and businesses offer goods and services in exchange for cash or barter. Retailing is essential to societal survival and the backbone of any economy.
Retail comes from the Old French word tailer (compare modern French retailler), which means "to cut off, clip, pare, divide" in terms of tailoring (1365). It was first recorded as a noun with the meaning of a "sale in small quantities" in 1433 (from the Middle French retail, "piece cut off, shred, scrap, paring"). Like in French, the word retail in both Dutch and German (detailhandel and Einzelhandel, respectively) also refers to the sale of small quantities of items.
Retailing helps to fulfill all types of needs; some essential to economic and personal survival, others recreational and luxury oriented. It creates jobs for the people who supply the raw materials and to factory workers who actually make the products, for the people transporting goods to the marketplace, the construction companies that build the stores and malls and for an entire service sector that maintains goods purchased by individuals. Retailing provides revenue to governments through taxation i.e. sales tax, import, export taxes and fees for applicable licenses. Further mergers and acquisitions within the retail sector impact stock markets and exchanges throughout the globe. For example the $16.5 billion merger between Federated Department Stores and Mays forming Macy's Department Stores and the 2004 merger between Kmart Holding Corp and Sears that was valued at $10.9 billion.
As of February 2012, according to the National Retail Federation, in the United States alone there are over 3.5 million retail establishments, over 28 million people employed directly while over 41 million people work at retail related jobs in general. $770 billion is generated at direct labor income and the total impact on the GDP is $2.48 trillion.
Retailing Then and Now
Retailers are part of an integrated system called the supply chain. A retailer purchases goods or products in large quantities from manufacturers directly or through a wholesaler, and then sells smaller quantities to the consumer for a profit. There are many different types of retailers; department and discount stores, warehouse stores, variety, demographic retailers aimed at a specific buyer, "Mom & Pop" stores owned and operated by individuals specialty stores, general and convenience stores, mail-order, hypermarkets, supermarkets, malls, category specialists, vending machines, no-frills, self-service or automated retail (robotic kiosks seen in airports and at supermarkets), big box stores and of course on-line e-tailers.
Technology has moved retail quite a distance from the traditional market or city square where traders set up stalls and buyers browsed merchandise. Today, retail resides in both a "brick and mortar" setting as well as online through e-commerce sites that continue to grow in number, products and services day by day.
Second Hand Retailing
Though referred to by a number of different labels throughout the globe, the pawn or second hand shop is a staple of most communities. Retailing second hand or used goods, it enables consumers to purchase goods at deeply discounted prices or to borrow against and using the value of the product as collateral against a cash loan. Auctions, estate sales, tag and garage sales are other forms of retailing that help to expose goods to potential buyers and even other retailers. Even the second hand retail market has found its way to the Internet via popular auction and sale sites that commission all sales as their part of the retail supply chain. The supply chain is a system of organizations, people, technology, activities, information and resources involved in moving a product or service from suppliers to consumers.
Retailing and Fund Raising
It is not unusual for non-profit organizations to use retailing as a fund raising tool; selling candy bars, magazine subscriptions, food and other item transforms the price paid to a donation or conversely when goods are donated and then retailed to the public by the non-profit organization to raise funds. In most cases the price paid for the goods or the goods donated are often recognized as a tax-deductible item.
Retailing is a part of and impacts almost all areas of a person's life. No matter if you are the buyer or the seller, retailing is an integral part of our economy; essential to survival and a road to prosperity when goods and services are properly marketed for optimum profit. Profit is defined as the return to an owner of capital stock (means of production or land) in any productive pursuit involving labor or a return on bonds and money in capital markets.