What is a Modern Age Retail Chain Store?
Modern age retail stores are referred to as organized retail store that involves a more organized and coordinated approach to drive revenues, increase conversions, have improved logistic management, etc. It includes big operators like supermarket chains, mini-supermarket, hypermarkets, and other retail stores businesses that deal with consumer goods such as floor cleaners, packaged rice, air fresheners, breakfast cereals, and many more products that are being used by consumers in their day to day life. This type of trade started in India in the 1990’s, from then it became popular and spread all over the country. However, modern retail stores are entirely urban phenomenon and the growing popularity informed by the fact that it is the best channel for the sale of consumer products.
What is Traditional Age Retail Chain Store?
Traditional age retail stores have adopted a trade, methods in this trade are introduced when a retail industry started. The trade is associated with a complex network of suppliers, manufacturers, distributors, retailers, and customers. In these stores retailers try to build an interpersonal relationship with customers to make them visit regularly. The majority of retailers are using this relationship technique to increase revenues. In these stores, brand choice is limited and retailers prefer to sell those brands which give them more profit. In this shopper doesn’t need to go here and there to collect goods all they have to do is to note down all the items and give it to retailers, then the retailer will give you or deliver noted items.
Maintaining strong relationships with vendors is one of the first things to do because vendors will provide fast delivery, convey offers or discounts, give information about new products, and many more.
The main difference between Modern & Traditional age retail chains is that distribution in modern stores is more organized. Modern retailers often deal directly with manufacturers. Many large retail chains have integrated their services to offer their brands in groceries and other goods.
There are also certain similarities between these two. One of them is “Special or Sale Days”, in traditional age the sale days are announced through the local newspaper or templates. Nowadays, new-age retailers are announcing these special days through websites, social media platforms, and all the platforms where they can easily communicate with their customers and attract others too. Another one is that they both focus on giving the customer a good buying experience and value for their money.
Certain phenomenons draw a thin line between modern age retail versus traditional-age retail chain stores. Through this, we can distinguish between the ways they both work, its working behavior patterns and many more. So every retailer can take advantage of adapting those techniques.
- Stock and Inventory Monitoring
Modern retailers maintain their minimum stock in case they require to fulfill immediate demand, and which is also a trigger to reorder the product. To balance the inventory which is minimizing carrying and ordering cost while increasing total demand. They have clear time-slots for each product replenishment. Since modern retailers occupy a sizeable business for the distributors, distributors or manufacturers rely on technologies to support a better schedule and route planning for their deliveries.
Traditional retailers maintain their stock manually. If any commodity gets out of stock or is having a less quantity then they call the vendor to give him the required order. Also, a vendor visits stores in 7-10 days on the purpose of taking orders. Sometimes a vendor sends more stock compared to the order created by the retailer, all this is done to meet the targets by sending more material.
From ours i.e. Vedalabs point of view, it is important to adopt technology and directly deal with distributors or manufacturers. In short, the order will be suggested by the IT system of a modern retail chain. Through this, the retailer will not be going in state of not having a commodity or being in the state of out of stock.
- One-on-One Customer Service
One-on-one customer service makes an experience unique. Today’s salespeople, usually, quickly approach the customers entering and offers them help.
Service at big stores consists of a customer searching to find an employee knowledgeable enough to answer detailed questions, especially regarding appliances. Thus in modern age retail stores, the manpower is used to provide service and the manager of a particular store should provide training and knowledge of all products to all the sales employees.
In the traditional age retail stores, owners or retailers prefer to provide one-on-one customer service to make them feel comfortable. When customers are comfortable from one store then there are more chances of them to visit again, after that retailer tries to make a long-term relationship and provides beneficial service to them.
From our point of view, it is clear that customer one to one service is beneficial for the store. Both ages of stores focus on creating a positive experience for customers and are trying different methods to increase their experience.
Modern age retail stores are being digitized and are using IoT(Internet of Things) to promote their stores. Promotions are done to boost your brand name in the market and reach a maximum number of people to know about your stores. They are using their websites, social media platforms like Facebook, Instagram, Linkedin, and every possible way to reach them. Many of the customers are using social media platforms, so this is one of the best ways to reach or approach them by providing information about upcoming events, launching new products, etc.
Whereas, traditional-age retail stores used mouth-to-mouth promotion to advertise their store. They use local newspapers and templates to convey their special or sales days.
It is important to adopt technology and digitalize to promote your store. Customers and their perceptions are changing every day. So start planning to invest in technology and do not back from your competitors.
Traditional retailers: Payment terms are clear with their vendors. As there is a limited number of vendors and there are different types of the commodity so they prefer both cash and credit facility. Payment is made to distributors immediately or on the next visit of a salesperson.
In the case of customers, retailers give credit facility to the one who is having a good long-term relationship with them.
Modern Retailers: Modern retailers usually demand long credit period from manufacturers. In the case of customers, they didn’t prefer to give credit facilities. But some are making their store cards, after shopping the points in card increases and after some points, the shopper gets a certain discount.
By seeing both, it is clear that payment terms should be clean with the customers. In other words, money should not be a reason for deteriorating their long-term relations. So, the modern age retailers are using the correct way by giving discounts to attract new customers. Also, for repeat customers, they provide discounts as well as loyalty rewards as a gift for being with the store.
These are some differences to understand the differences between traditional age and modern age retail stores.
After understanding all the retailers need to ensure that they do not sacrifice their identity. The goal is to attract shoppers, it has been proven to be possible by successful retailers who have moved or are moving to apply modern approaches, so there are no excuses. Fear of change, fear of investment, all need to be to create change and it should act now.
So, in the battle of traditional retail vs. modern retail, who’s the winner? Well. It is complicated to say. Even most traditional retailers are going to embrace some of the modern methods and there is nothing wrong with gripping the traditional shopping experience. So, perhaps it’s most appropriate to say that both traditional and modern retail have their place