8 Complete Forms of Retail Business Classification

Retail is the sale of goods to end users, not for resale, but for use and consumption by the buyer. Retail involves selling merchandise from one point of purchase directly to customers who intend to use the product.

A single point of purchase can be a mortar retail store, internet, catalog, or even cellphone shopping site. Retail transactions are at the end of the chain. Manufacturers sell large quantities of products to retailers, and retailers try to sell the same number of products to consumers.

Why is Retail Important?

Retailers are the final link in the supply chain between producers and consumers. Retail is important because it allows producers to focus on producing goods without having to be bothered by the amount of effort needed to interact with end users who want to buy the item.

Retailers must make easy purchases for consumers. That’s why retail stores have salespeople, why shopping websites are shopping for instant shopping shopping, and why catalogs have descriptions, photos, and toll-free telephone numbers.

Retailing is about displaying products, describing the features and benefits of products, stock products, processing payments and doing anything to get the right product at the right price to the right customer at the right time.

Some retailers offer additional services for retail transactions such as personal shopping consulting, and gift wrapping to add something extra to the retail customer experience and go beyond the experience of retail customers.

What is the Difference between Retail and Wholesale?

Traders sell in large quantities, without worrying about the many retail aspects consumers expect such as visual merchandising. Traders do not want to deal with a large number of end-user customers.

Instead, their goal is to sell large numbers to a small number of retail companies. It is very rare for wholesalers to sell goods directly to consumers such as the advantages and disadvantages of retail businesses .

The members’ only retail stores are hybrids of wholesale and retail because they sell directly to consumers, but sell in large quantities, which often allows them to sell at lower prices than other retailers who sell small amounts of impeccable merchandise. shop in the shopping district with high rental fees.

The big difference between wholesale and retail is price. The retail price is always more than the wholesale price. The reason for this is because the additional costs of selling merchandise to end-user customers – labor, rent, advertising, etc. – are taken into account in the price of merchandise. Wholesalers do not have to deal with such costs, which enable them to sell goods at lower costs.

How Do Retail Supply Chains Work?

The retail supply chain consists of producers, wholesalers, retailers and consumers (end users). Wholesalers are directly connected to producers, while retailers are connected to wholesalers, and not to producers. This is the role of key players in the retail supply chain, namely:

  • Producers – Produce goods, use machinery, raw materials, and labor
  • Trader – Buy finished goods from the producer and sell the item to the retailer in large quantities
  • Retailers – Sell small quantities of goods to end users at higher prices, theoretically at the MSRP (Manufacturers Suggested Retail Price).
  • Consumer – The end user who buys the item (or “shop”) from the retailer for personal needs.

There are exceptions to this traditional supply chain. Some of the largest retail companies in the world such as Walmart and Amazon.com, for example, are large enough to deal directly with producers, without the need for wholesalers in the middle of transactions.

What are the Various Retail Business Classifications?

Here are some examples of various types of retail stores where consumers can buy products for immediate use or consumption such as retail ownership types .

1.  Department Store

Selling various merchandise arranged by category to various parts of physical retail space. Some department store categories include shoes, clothing, beauty products, jewelry, household appliances, etc.


  • Electronic Equipment
  • Apparels
  • Jewelry
  • Property
  • Cosmetics
  • Footwear
  • Sports and Book Apparel
  • Toys, CDs, DVDs

2. Grocery and Supermarket Stores

Selling all types of food and beverage products, and sometimes also home products, clothing, and electronic goods as well.


  • Almost the same as a convenience store but at a cheaper price.
  • Bread products
  • Cereal
  • Meat Products, Fish Products
  • Bread
  • Drugs
  • Vegetables
  • Fruits
  • Soft drink
  • Frozen food
  • Canned juice

3. Warehouse Retailer

No-frills warehouse type facilities are stocked with various kinds of products that are packaged in large quantities and sold at prices lower than retail prices such as the type of retail business .


  • Egg
  • Bread
  • Stationary
  • Toy
  • Cigarettes
  • Cereals
  • Peanuts
  • Drugs

4. Special Retailers

Specialize in certain product categories. There are many of these types to be found now. As the name suggests, specialized retailers will specialize in certain products and will not sell other items apart from specific ranges.

Special stores only sell selective goods for one particular brand to consumers and mainly focus on high customer satisfaction. Examples are: You will only find Reebok merchandise at the Reebok store and nothing else, making it a special shop. You will never be able to find Adidas shoes at the Reebok outlet.

5. Convenience Retailer

It is usually part of a retail location that sells gasoline primarily, but also sells limited merchandise and health care products with premium “comfort” prices from retail stores.

6. Discount Retailers

Selling a variety of products is often labeled private or generic brands at prices below retail prices, discount retailers often look for closeout items and stop merchandise at prices lower than wholesale prices and pass. savings to their customers.

7. Mobile Retailers

Use a smartphone platform to process retail transactions and then send products purchased directly to customers such as the definition of non store retailing .

8. Internet E-tailer

Internet shopping sites and sending purchases directly to customers at their homes or workplaces and without the costs of ordinary brick and mortar retailers, usually sell merchandise at a price lower than the retail price.

Goods supplier

The country’s geographical position has advantages and disadvantages for retailers. You might want to import goods for sale to customers. Sourcing goods from abroad can mean saving costs from local stockists or the ability to stock items that are unique to a country’s market with additional transportation costs, can even push margins for local retailers.

Find out if you are ready to import. For more information about finding the right item at the right price for your business, see choosing the right supplier.

Are you ready to start a career in the retail business?

Access free start-up business support from your local government. Contact them to get one-by-one advice from business advisors and customized guidelines to develop your business plan.

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