A store specializing in a particular type of merchandise or a single product of durable goods that is, home furniture and household goods, consumer electronics and/or domestic electrical appliances) or a range of normally complementary durable goods product categories is termed as a specialty store. Such a business model is characterized by a high level of service or product information being made available to customers.
These are characterized by a narrow product line, with deep assortments in that product line. Specialty stores usually concentrate on apparel, Jewelry, fabrics, sporting goods, furniture, etc They have a very clearly defined target market and their success lies in serving their needs.
Internationally, most specialty retailers would operate in an area under 8,000 sq ft. Examples of international retail chains which are specialty, include The Gap, lkea, High & Mighty, Big & Tall etc In India, specialty stores is one of the fastest emerging formats. Examples of specialty stores in India include retail chains like Proline fitness station and Gautier furniture.
Aristide Boucicaut the son of a successful hat maker founded the first department store Bon Marche in Saint-Germain, Paris in the year 1838. The store lured shoppers by selling different types of goods, all under one roof. In the United States, A T Stewart established the Marble Dry Goods Palace, where he offered retail merchandise at fixed prices, on a variety of dry goods, and advertised a policy of providing free entrance to all potential customers. Similar developments were under way in London and in other parts of the world.
By 1890, a new world of retailing had been created as department stores a clear market position as universal providers. General stores eventually became department stores as small towns became cities. The most prominent department stores emerged from small shops. The department store is also largely responsible for the standard store design seen today. The store layouts made shopping easier for consumers, irrespective of their social or economic background. The department store also offered new customer services never before, new types of merchandise displays and so forth. This format of retailing is popular in many parts of the world.
In broad terms, a department store is a large scale retail outlet, often multi level whose merchandise offer spans a number of different product categories. Traditionally, department stores can be defined as averaging 7000 sq m selling at least fashion clothing, accessories, cosmetics, household goods and often a much broader assortment, from more or less separate departments on several floors.
Department stores are defined as those establishments depending on food, clothing and home related items for at least 10% but less than 70% respectively of their sales. Furthermore, these stores have at least 50 employees and a self service ratio of less than 50%.
While department stores have been around in India for a long time, this format of retailing has seen a fair amount of action over the past few years. The size of an average Indian departmental varies from 20,000 to 40,000 sq ft and stocks anywhere between 50,000 to 1,00,000 SKU’s. Some of the national players are Shopper’s Stop, Globus, Westside and lifestyle, while others like Akbarally’s, The Bombay Store, and Benzer in Mumbai; Ebony in Delhi and Chermas and Meena Bazaar in Hyderabad are the prominent local players. Some of the well known international players in this format are Marks & Spencer, Sears, JC Penny, Harrods, Selfridges, etc.
Off price retailers:
Here, the merchandise is sold at less than retail prices. Off price retailers buy manufacturers seconds, overruns or off seasons at a deep discount. The merchandise may be in odd sizes, unpopular colors or with minor defects. Off price retail stores may be manufacturer owned or may be owned by a specialty or departmental store. These outlets are usually seen by parent company as a means of increasing the business. The factory outlets in case the manufacturer owns them, may stock only company merchandise. Examples of these include Pantaloon Factory Outlets, Lei’s factory Outlets, etc. On the other hand, off price retailers owned by the specialty or departmental store may sell merchandise from the parent company as well as merchandise acquired from other retailers. This largely depends on volume sales to make money.