Retail Terms: Must Read

Electronic retailing A retail format in which the retailers communicate with customers and offer products and services for sale over the Internet.
Factory outlet Outlet store owned by a manufacturer.
Franchising A contractual agreement between a franchisor and a franchisee that allows the franchisee to operate a retail outlet using a name and format developed and supported by the franchisor.
General merchandise catalog retailers Non-store retailers that offer a broad variety of merchandise in catalogs that are periodically mailed to their customers.
Home improvement center A category specialist offering equipment and material used by do-it-yourselfers and construction contractors to make home improvements.
Hypermarket Large (100,000 to 300,000 square feet) combination food (60 –70 percent) and general merchandise (30 –40 percent) retailer.
Infomercials TV programs, typically 30 minutes long that mix entertainment with product demonstrations and solicit orders placed by telephone from consumers.
Internet retailing A retail format in which the retailers communicate with customers and offer products and services for sale over the Internet.
Leased department An area in a retail store leased or rented to an independent company. The leaseholder is typically responsible for all retail mix decisions involved in operating the department and pays the store a percentage of its sales as rent.
Multi-level network A retail format in which people serve as master distributors, recruiting other people to become distributors in their network.
Off-price retailer A retailer that offers an inconsistent assortment of brand name, fashion-oriented soft goods at low prices.
Outlet store Off-price retailer owned by a manufacturer or a department or specialty store chain.
Party plan system Salespeople encourage people to act as hosts and invite friends or co-workers to a “party” at which the merchandise is demonstrated. The host or hostess receives a gift or commission for arranging the meeting.
Pyramid scheme When the firm and its program are designed to sell merchandise and services to other distributors rather than to end-users.

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