Types of retail businesses
Tips / 30.12.2022
The retail sector in the UK is going through some fluctuations on a month-on-month basis. Although there was an overall 0.4% drop in overall sales volumes for retail sales in November and a 2.8% drop for predominantly online retailers, the sector is still a major contributor to the economy. In fact, in November 2022, it contributed a whopping £9.8 billion per week, which is a rise from £8.6 billion in September.
With approximately £39.2 billion contributed to the British economy in the space of one month, retail is an important part of people’s everyday lives. But because little is known about the sector, the differences in terms of the main types of retailers often remain a mystery to many people.
As such, we’ve prepared this post to help you get more clarity on the different types of retailers and what their business processes entail. Let’s take a closer look.
Table of Contents
Different types of retailers
In the world of retailing, you may think of your community store where you purchase groceries as the only type of retailer that there is. While these are predominant in the sector and in our communities, there are, in fact, numerous other types of retailers. To find out about the different types of retailers, take a look below.
1. Convenience store
We are all familiar with the concept of the convenience store. But what makes it such and where can you find one? The convenience store is generally a small to medium-sized grocery store that typically operates in or near residential areas. It’s classically known as the “corner shop” and makes for an important contributor to the economy and to communities.
The name “convenience” implies that it really is convenient for shoppers. This is because its positioning and placement see it offering a suitable solution to communities’ everyday needs and necessities.
The convenience store typically offers goods that meet consumers’ daily needs. From milk and bread to toilet paper and others.
2. Speciality store
Next up, we have the speciality store. Much as the name suggests, it’s not a general brick-and-mortar store that sells a variety of items. Instead, it is rather focused on narrow and specific product types and categories.
These may include things such as clothing, electrical and electronic goods, entertainment and others.
The supermarket is the convenience store’s bigger cousin. It is either a chain store with branches all over the country or an independent business with one retail location.
These stores are generally bigger than convenience stores and are considered medium to large retailers. This is the case even though they also sell household goods as well as food to consumers.
Their primary means of achieving profitability is through low-margin/high-volume sales.
4. Discount store
We’ve all heard of “dollar stores” in the US, but is there an equivalent in the UK? The answer is that there certainly is. These come in the form of discount stores, which may vary in size. In fact, they can come in small, medium or even large sizes.
And their main purpose? It is to source and sell end-of-run stock or branded products, which are then sold to consumers at highly discounted prices.
5. Department store
Department stores can be found in malls or as stand-alone options. In general, they are large stores (larger than convenience stores and supermarkets).
Although they also sell a wide range of products and services, they are generally divided into departments. This means that you can have anything from children’s toys and clothing to home appliances and cutlery and crockery under one roof.
In many cases, department stores can sell both branded products (of their own brand) or they can stock goods from other retail suppliers and companies.
6. Warehouse/direct retailer
Whereas department stores are usually found right on the high street, warehouse retailers or direct retailers are located off it. They can be medium or large in size. And the way in which they operate is to stock goods directly from a manufacturer.
This eliminates an important step in the supply chain and logistics process from the structure of the store. And consequently, it means that customers can often get a range of goods (household and otherwise) at much lower prices.
7. Online store
Online stores are the last type of retailer that we’ll cover. And it’s important to note that their popularity is rapidly rising owing to the convenience that they offer. An online store, an electronic commerce store or an e-commerce store (as it’s usually called) differs from the above retailers in that its product offering is sold directly to customers through a website.
Some of the most popular items that are sold by e-commerce retailers include computers and electronic goods, mobile devices, etc. However, many other options are possible including anything from furniture to clothing, gifts and accessories and so much more.
The rise of online retailing has skyrocketed and just this year, in 2022, it accounted for £2,089.6 billion in the UK. Interestingly, many physical or brick-and-mortar stores are starting to introduce an online offering to complement their physical store. This means that customers can start off by browsing products online and then going to the store to purchase it.
Although there are misconceptions about how difficult it is to start an online store, with myPOS, this is completely easy, hassle-free and yes, free! myPOS Online offers retailers and entrepreneurs the opportunity to launch their own secure online store through which to sell or even complement their physical store offering. It’s completely easy and set-up can be done in a matter of minutes. In fact, with myPOS Online, you can:
- Choose how you want to name your store
- Pick from a wide variety of website templates
- Offer all payment and delivery methods to your customers
- Upload and manage your products from anywhere
- And so much more!
These days, customer convenience is a must and retailers need to up their game to ensure that they can compete effectively in a cutthroat marketplace. With ever-decreasing costs in supply chains and methods of production, it’s no wonder that many retailers are supplementing their physical store offering with an online presence. This is a highly effective way of capturing a wider clientele and boosting the bottom line.
Another way of boosting customer convenience at your physical store is to offer convenience in terms of payments. Using a point-of-sale (POS) terminal or a card reader will allow you to accept contactless, Chip & PIN and magstripe payments with ease. And the best part is the instant settlement of funds that myPOS offers its customers, alongside a range of other perks.
Disclaimer: Please be aware that the contents of this article and the myPOS Blog, in general, should not be interpreted as legal, monetary, tax, or any other kind of professional advice. You should always seek to consult with a professional before taking action, since the particulars of your situation may materially differ from other cases.