Social and Economic Significance of Retailing

The retailer acts as a link between the customer and the marketer, who is responsible for selling the ultimate products and services to the customers.

In the entire complicated process of marketing, retailer acts an intermediary in the complex marketing & distribution channel. Though manufacturers can directly sell their products and services to the end customers ultimately, it may result in high expenses, inconvenience and time-consuming process.

Social Significance

In the present business scenario, social responsibility and increasing importance are being given to driving the functions of marketing functions with a sense of social responsibility. This has resulted in retail organizations paying a great deal of attention towards the social responsibilities which they have towards their customers.

Regulation and control from various pressure groups such as social activists, social workers, and consumer activists compel the retailers in implementing their marketing programmes restrictively and communicating the true picture about the benefits or harms of using a product.

The retail fraternity should give importance to the cultural differences and also the differences in the values, beliefs, and faith of people while formulating their marketing strategies and business development plans. This will be helpful in meeting the demands of the consumers by understanding their expectations.

The marketing department of retail companies is engaged in identifying the opportunities and threats to the business of the company by analyzing the socio-cultural trends and the buying preferences of the consumers.

Economic Significance

The retailers play the role of sales specialists and also as agents of purchase for their customers and suppliers respectively. Retailers handle the entire gamut of roles and functions aiming at understanding customer requirements and anticipating the demand, gathering information about the market trends through strong market intelligence and making product related assortments and discovering financing opportunities.

It is relatively easier to become a retailer, as large investment is not required, procurement of production equipment is not required, and a retailer can procure merchandise on the basis of credit.

The retail sector in the present scenario is witnessing a fierce competition as a large number of retail players have entered in the same market segment with similar product offerings. The only differentiating factor which may provide a winning edge in the competitive race is by providing better value to the consumers and satisfying the consumers with their offerings. Besides this, a retailer should also be providing justice to the producers and also to the wholesalers by ensuring that their products are sold to the ultimate consumers.

For expansion of business opportunities globally and tapping larger business prospects, large retailers have been diversifying their business formats by way of mergers or acquisitions to cater to the growing needs of a diverse and a larger customer segment.

Moreover, the retail industry has been impressive regarding generating large-scale employment opportunities worldwide which is expected to grow at a much faster rate in comparison with the other sectors performance in future as well.

The retail sector has opened newer job avenues for people having different areas of specialization with diverse skills and qualification backgrounds. These opportunities could be in the areas of Finance & Accounting, Retail Operations, Commercial Operations, Inventory & Warehousing, SCM & Logistics, HRM, Distribution Systems, Marketing & Brand Management, IT, New Products Development & Market Research/Business Analysis.

Retailing career can be quite rewarding right from the start of the career for a person as it may require bearing a handling a lot of challenges and responsibilities right from the beginning. Moreover, retailing has given rise to entrepreneurial opportunities, and few of the wealthiest entrepreneurs are involved in the retail business.