Introduction to Retail
What the domain tests
The Introduction to Retail domain checks whether you can define retailing, place the retailer in the supply chain, and explain the value a retailer adds. Expect questions on functions such as breaking bulk, sorting, assorting, and providing after-sales service, plus the difference between organised and unorganised retail.
Core rules
- Retailing is the sale of goods or services to the final consumer for personal or household use, not for resale.
- A retailer is the last link before the consumer; a wholesaler sells mainly to retailers or business users.
- Retailers create place, time, and possession utility: they make goods available where and when customers need them and complete the sale.
- Breaking bulk means buying in large quantities and selling in smaller units. Assortment means offering a range of related products.
- Organised retail operates within legal and tax systems, often with standard processes; unorganised retail includes small independent shops with informal systems.
- Retail is not only physical: e-commerce, direct selling, and vending are retail channels.
Worked example
A kirana shop buys 100 soap bars at ₹20 each and sells them singly at ₹25. It has broken bulk and created an assortment with other toiletries. Gross margin per bar = ₹25 − ₹20 = ₹5; margin percentage on selling price = 5 ÷ 25 × 100 = 20%. The shop earns ₹500 if all 100 bars sell, before expenses. The reasoning separates buying cost, selling price, and margin, which is what the exam rewards.
Traps
Do not call a wholesaler a retailer. Do not calculate margin on cost when the question asks for margin on selling price. Do not say retailing always involves a shop. Do not treat turnover and profit as the same.