A discount store is a term that is used to refer to a retail shop that sells its goods at a relatively lower price than the prices in the typical market. A mass merchandiser may be able to offer a range of an assortment of goods focusing on the price instead of focusing on the service, the choice within the lines or even the display (Benson & Shaw, 2013). In other cases, the “speciality” discount store like staples has the capability of specializing in merchandise lines relying on the bulk purchase and the fair distribution of goods with the aim of keeping the costs down (Evans, Chatterjee, & Berman, 2017).
A departmental store refers to a retail establishment which offers a vast range of consumer goods in different categories. In the modern cities, corporate stores appeared in the 19th century and made a new shape to the shopping habits and also the definition of luxury. In our today’s world, the departmental stores include furniture, home appliances, hardware, the sporting goods and paint among many others (Resseguie, 2015). Other lines of products which include books, electronics, baby goods and pets among others are at times included. In most cases, customers check out near the storefront. However, some stores include sales counter in every department while other stores are one of many within a more massive retail chain. Other departmental stores are entirely independent retailers (Evans, Chatterjee, & Berman, 2017). In the early 1970s, they came under the massive pressures from the discounters and also got pressure from the e-commerce sites including Amazon. Hypermarkets and discount stores are similar to the departmental stores.
Discount stores are not examples of variety stores that sell goods at a single price. Discount stores sell many products. They offer a wide range of prices. After world war two, retail establishments started to pursue a high volume strategy with the aim of attracting more and more customers. The policy led to a renewed interest from retailers stemming from the great recession of the USA in 2007 which in a way forced the retailers to revisit their approach to the goods that they wanted. Currently, Aldi is the largest retailer in the world, and it operates approximately 11,000 discount stores globally (Benson B. P., 2014).
Discount stores were trendy in the USA in the second half of the 19th century than the average supermarkets or even the departmental stores. The most successful ones in that time occurred in the 1960s, and the discount store chains included Kmart, Carldo and Howard discount stores among others. Wal-Mart and Kmart started their operations and picked in 1962. Some other retail companies began new branches as discount store businesses globally (Miller, 2015). A good example is for the case of Woolworth which started the Woolco chain and the Montgomery store which started the Jefferson store among others. In the 1970s and late 1980s, the chains created were either closed or sold to larger competitors.
In the United States, the discount stores accounted for 42% of the overall market share in the year 1987 while in the year 2010 they accounted for approximately 88%. Today, most of the discounters run supercenters which possessed a full-service grocery store to the ancient formation. A good example is the Meijer chain in the west that consists of supercenters while the Wal-Mart and target have given much focus on the format of the 1990s as a factor that contributed much to their growth. Although the discount stores and departmental stores possess different markets and also different aspirations, the current development in the retailing is the departmental discount stores and an example is the Sears Essentials which is a combination of Kmart and Sears (Jefferys, 2016). The latter was arrived at after the merging of the two companies. Some of the discount stores found in the United States of America include Aldi, Wal-Mart, Target and Roses, Kmart and Shopko among others.
The first American departmental store in the New York City was Arnold Constable. The store was founded in the year 1825 and was started by Aaron Arnold who was an immigrant from Great Britain. This store served as a small good store on the pine street in the New York City. In 1857, dramatic changes occurred and the store moved to a five-story marble goods palace, and it was hence known as the marble house. During the civil wars that existed in those days, Arnold was one of the stores that issued a charge on the bills of credit to its prospective clients (Gereffi, 2015). The store was hence recognized as an emporium for the good quality fashions. Within a short period, the store had already grown, and it outdid the marble house, and it erected an iron building on Broadway and the 19th street by the year 1869. This trading area expanded over the years till the owners saw it was good to move to a new space which was relatively more significant. In the year 1925, Arnold Constable merged with Stewart and company and enlarged to the suburbs. The first store after the expansion was Rochelle, New York and then afterward into Hempstead and in New Jersey. However, financial shortcomings led to bankruptcy in the year 1975 (Wong & Sohal, 2015).
In the year 1846, Alexander Stewart founded the Marble Palace on Broadway that existed between chambers and Reade streets. This businessman offered the European retail merchandise at prices that were fixed on a range of goods and promoted a policy of free entrance to all prospective buyers. Even though it was clad in the white marble to be a perfect replica of a Renaissance palazzo, the cast iron of the building permitted plate glass windows thrown iron that made seasonal displaying easier and especially during the Christmas season (Kumar, 2016). In the year 1862, Stewart put up a brand new store on a city block that had eight floors and nineteen departments of glass, carpets, sports kits, China toys and dress goods among others. The innovation of this entrepreneur included the purchase from the manufacturer for cash and in bulk, maintaining his markup and prices very low, the exact representation of merchandise, no haggling at all, simple returns on merchandise, the policy of cash refund and selling strictly on cash and no credit. Within no time, his moves were widely copied by the other departments (Fornell, 2017).
In the year 1858 in New York City, Rowland Hussey Macy established Macy’s, and it was known for dry goods storage. After a short while, Benjamin Altman and Taylor competed with the Stewart since they were the earliest stores in New York and later they were followed by McCrery’s and then in Brooklyn there was the establishment of Abraham and Straus (Benson B. P., 2014). By late 1880s, the New York retail center had formed a stretch of retail shops from the marble palace commonly known as ladies mile. By the year 1894, there was stiff competition in the Christmas season with elaborate Christmas window displays. In the year 1895; the Macys featured 13 tableaux which included scenes from Jack and Beanstalk and other favorites for the children (Gereffi, 2015).
In the year 1877, John Wanamaker started the first modern departmental store in the United States of America in a former Pennsylvania Railroad in Philadelphia. This was the first departmental store that offered goods at a fixed price on every article (Zentes , Morschett , & Schramm-Klein, 2016). It was also the first corporate store that introduced electrical illumination in the year 1878, the telephone in 1879 and the utilization of pneumatic tubes in the transportation of money and other documents. Other departmental stores that were opened in Philadelphia included: straw bridge, lit brothers, and clothier among others (Jefferys, 2016).
In the next five or ten years, the retailing business will be in existence but will have a very different appearance. Due to the presence of the steady migration to the mobile and electronic commerce, the retail business will be nice (Zentes , Morschett , & Schramm-Klein, 2016). Due to these changes, we will expect an increased customized concierge on the demand services an also services on demand, integrating consumption and entertainment. The following trends show that the future of retailing will be very different (Wong & Sohal, 2015).
In our today’s society, the norm has been a two-day delivery. However, research shows that this is changing and at least 25% of the consumers confirm that they would abandon their orders if there were no availability of one day. This is clear evidence that two-hour drone delivery is approaching in the foreseeable future and some platforms like Amazon are taking about half an hour of drone delivery (Fornell, 2017).
There is an increase in the demand for purchasing opportunities as the tech-savvy generations are becoming worn out as time goes by. Research shows that a quarter of the consumers in the united states who are aged 24 to 34 years do a quarter of their shopping online. The digital natives that belong to generation Y and Z are waking up and will very soon pick as heavy consumers as the slow an old tech-savvy generation is just disappearing. This is taking over, and online sales are taking place and will be so in the next ten years (Kumar, 2016).
Research shows that a growing number of people do not mostly bother going downtown and do shopping an bring home goods by themselves anymore. In the last few years, Netflix came up with a service whereby people could order movies through the mail and then sent them to their homes through the mail. Many people have welcomed the latter, and this reflected a behavior that has affected more and more firms (Resseguie, 2015). Some retails also affirmed that their consumers require them to offer the products at their homes no matter the quantity. If this continues for a while, the future of retail shops will have an entirely different shape (Resseguie, 2015).
In the recent past, it was easy to separate online activity from the other activities since there was a clear pattern of how people made use of the internet. In the morning the number of people online used to be more but went down during lunch time then rose in the evening. The pattern has disappeared today and has been replaced by an increase in the usage of smartphones. People wake up today and check their profile on Facebook or what Sapp on their profile (Jefferys, 2016). If you fail to have these applications, you will never get to communicate with these people.
This is growing faster than any other retailing activity. The global mobile sales for eBay reached USD 2 billion recently, and the figure has been doubling in the years till today whereby it stands at $ 5 billion. M-commerce in the US amounted to 9.8% of all online sales in a day, and the same trend was reported In Europe (Kumar, 2016). This trend shows that in the next 5 to 10 years, retailing will have taken totally different shape.
Conclusion
The above discussion has been helpful and has helped us to have basic knowledge concerning retail trade. Retail trade has a good start and should change with the change in technology. In the cases whereby consumers can access the world without limit, the online retailers will have a significant advantage over the traditional retailers since there will be no cost of operating building all over. However, the latter does not mean that the conventional retailers will not be there in the future. The retailers will be there but will have a different shape. This will create a good environment for consumers since the environment to purchase goods will be favorable.
References
Benson , J., & Shaw, G. (2013). The Evolution of Retail Systems. Vancouver.
Benson, B. P. (2014). Counter cultures: Saleswomen, managers, and customers in American department stores, . University of Illinois Press.
Evans , J. R., Chatterjee, P., & Berman, B. (2017). Retail Management: A Strategic Approach, 13th Global Ed. Pearson. ISBN: 9781292214672; 9781292214689.
Fornell, C. (2017). A national customer satisfaction barometer: The Swedish experience. the Journal of Marketing,, 3, 6-21.
Gereffi, G. (2015). The Organization of Buyer-Driven Global Commodity Chains: How US Retailers Shape Overseas Production Networks. Oxford University Press.
Jefferys, J. B. (2016). Retail trading in Britain 1850-1950: a study of trends in retailing with special reference to the development of co-operative, multiple shop and department store methods of trading. Cambridge University Press.
Kumar, V. (2016). Building and sustaining profitable customer loyalty for the 21st century. Journal of retailing, 37(3), 245-254.
Miller, M. B. (2015). he Bon Marché: bourgeois culture and the department store,. Princeton University Press.
Resseguie, H. E. (2015). Alexander Turney Stewart and the development of the department store. Business History Review, 34(2), 300-324.
Wong , A., & Sohal, A. (2015). An examination of the relationship between trust, commitment and relationship quality. International Journal of Retail & Distribution Management,, 5, 56-65.
Zentes , J., Morschett , D., & Schramm-Klein, H. (2016). Strategic Retail Management: Text and International Cases. 3rd. Springer ISBN: 9783658101831 .
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