Specificity of management competition in retail trade

Before to pass to a question of features of a competitiveness in retail trade, it is necessary to stay on some question which have not been mentioned yet in the given work and which concern features of entry in branch of the new enterprises (threat from potential competitors), to competitiveness classification in sphere of retail trade and to a question as the competitiveness and competitiveness are really connected in retail trade.

Sales efforts in comparison with the industrial or financial differ practically complete absence of "source barriers» in branch and ease of entry that means availability of constant threat of occurrence of new competitors and availability of natural protection against monopoly. Level of "a source barrier» in branch is defined by a number of factors which include primary type of production in branches, level of the branch cost price and level of standardization of production in branches, degree differentsirovannosti production, availability of channels of distribution, requirement for additional investments, conservatism of existing system of deliveries, the factors defining a high level of the cost price of the branch enterprises, not connected with production scale [12, 30]. For retail trade influence of a significant part of these factors, however level of their influence is characteristic can differ considerably depending on a kind of the sold goods or depending on specialisation of the retail dealer (it concerns the cost price, standardization and differentsirovannosti the goods). There is an essential difference in access on the market of large and small retail operators, and actually the retail trade market for a long time already has undergone to division on levels in branch, for example on target audience, not without reason strong retail operators actively expand the last 2-3 years the sphere of influence, seizing the task forces not mentioned by them (an example the retail trade system «the Seventh Continent» which has divided the supermarkets on level of consumers on can serve: « Seven steps »- supermarkets for consumers with the income below an average,« the Seventh continent »- supermarkets for consumers with the income above an average and« Five stars »- supermarkets for very well-founded consumers.« The source barrier »is essential enough to small retail dealers on an indicator of the starting capital, and for large this factor is not concerning to« source barriers ».

It is possible to speak about availability to new competitors of channels of distribution basically in a cut of "loyalty" to suppliers, and also importance of such indicators of activity of the supplier as term of its work in the given market, its popularity and
Scale of its activity. These factors are more important for large retail operators, for the small advantage of the offer is more important, therefore they becomes easy can a trade channel for the new competitor. Influence on competitive circle of end users and suppliers depends from enough big group of factors (fig. 16).

For competitiveness classification in retail trade we will consider activity of subjects of the consumer market through satisfaction of requirements of the population.

The consumer, realising the interests, makes defining impact on behaviour of businessmen in the market at the conclusion of bargains, a choice of a market segment, the organisation of sales and sale of the goods, formation assortimentnoj, price politicians. Communication between the consumer, the manufacturer and a retail link is presented in drawing 16.

From the given scheme it is possible to introduce competitiveness kinds in retail trade.

Certainly, the retail dealer conducting activity in the competitive market, combats in several directions which are necessary for classifying.

The competitiveness is literally defined as “struggle of independent economic subjects for the limited economic resources” [81, 109]. However the sense of concept a competitiveness is much deeper also the formulation enough detailed definition requires extensive research and generalisation of works of many economists.

Drawing 16 - Communication between the consumer, the manufacturer and a retail link

To begin follows from the definition of a competitiveness resulted in the Law of the Russian Federation from March, 22nd, 1991 № 948-1 «About a competitiveness and restriction of monopolistically activity on commodity markets» (with changes from June, 24th 1992г, on May, 25th 1995г, on May, 6th 1998г, on January, 2nd. 2000г): the competitiveness is a competitiveness of managing subjects when their independent actions effectively limit possibility of each of them odnostoronne to influence general conditions of the circulation of the goods on a corresponding commodity market.

However such definition on a today's level of development of an economic science is represented rather narrow since it does not grant any possibility for interpretation of concept of competitiveness.

Probably (at a sight of the author) the most successful definition belongs to Azoevu G. L - «the competitiveness is understood as rivalry in any field between separate legal and the physical persons (competitors) interested in achievement of the same purpose» [4,13]

The question of classification of a competitiveness in general (nanosecond with reference to the retail market) is well enough covered in the modern economic literature. So I.N.Gerchikova offers the following system of classifications of a competitiveness [18,62]:

1. On character of satisfaction of requirements the competitiveness is divided on functional, specific and subject;

2. On methods of realisation of a competitiveness it is divided on diligent and unfair, price and not price;

3. Under forms of connection of the consumer and the manufacturer it is divided on made and imperfect (monopoly, oligopolija and a monopolistically competitiveness)

In A.J.Judanova's allowance [106, 34] a number of approaches to competitiveness classification is allocated. Depending on a classification sign distinguish following kinds of a competitiveness '.

On a market condition allocate: perfect (free), imperfect, regulating. The perfect (free) competitiveness is based on a private property and economic isolation. She assumes, that in the market there is a set of the independent firms independently decisive what to create and in what quantities, and also:

1. The volume of production of separate firm is insignificant and does not render influence on the price of the goods realised by these firm;

2. The goods realised by each manufacturer are homogeneous;

3. Buyers are well informed on the prices and if someone rises the price for production will lose buyers;

4. Sellers act independently from each other;

5. Access on the market anybody and is limited by nothing.

The scheme of a perfect competitiveness has, basically, theoretical significance. However it is a key to understanding of more real market structures. And in it its value.

The imperfect competitiveness existed always, but has especially become aggravated in the end of XIX - the beginning of XX century in connection with formation of monopolies. The monopoly assumes the exclusive right of production, a craft, trade and other kinds of the activity, belonging to one person, a certain group of persons or the state. It means, that by the nature monopoly - a direct opposite of a perfect competitiveness. The professor P.Samuelson underlines this circumstance: «to Economy of large production, probably, the certain factors conducting to the monopolistically contents of the organisation of business are inherent. It is especially visually shown in fast varying area of technological development. Clearly, that the competitiveness could not exist and be long effective in sphere of uncountable set of manufacturers» [47, 57]

Regulating competitiveness. To resist in competition, the businessman should offer items which are preferred by the consumer (the consumer sovereignty). From here and factors of production under the influence of the price are directed to those branches where in them there is the greatest requirement.

On methods of rivalry allocate; price and not price. The price competition occurs, as a rule, by an artificial undercutting on given production. Thus the price discrimination which takes place is widely used when the given product is sold under the different prices and these price distinctions are not justified by distinctions in costs. The price discrimination is possible under three conditions:

1. The seller should be a monopolist or have some degree of the exclusive power;

2. The seller should be capable to allocate buyers in groups which have different consumer ability;

3. The initial buyer cannot pereprodavat the goods or service.

The non-price competition is conducted, mainly, by means of

Perfection of quality of production and conditions of its sale, "servizatsii" sales. Improvement of quality can be carried out in two basic directions: the first - perfection of technical characteristics of the goods; the second - improvement prisposobljaemosti the goods to needs of consumers. The non-price competition by means of improvement of quality of production has received the competitiveness name on a product. This kind of a competitiveness is based on aspiration to seize a part of the branch market by issue of the new goods which or essentially differ from the predecessors, or represent the modernised variant of old model. The competitiveness based on improvement of quality, has inconsistent character. On the one hand, improvement of quality serves as method of the latent reduction of prices and sales expansion; with other - quality is a value judgment which opens possibility of falsification of quality by advertising and beautiful packing.

The non-price competition by production sales has received the competitiveness name on conditions of sales. This kind of a competitiveness is based on improvement of service of service of the buyer. Effect on the consumer through advertising, trade perfection, an establishment of privileges on service of buyers after goods acquisition, i.e. in the course of its operation here enters.

Advertising, today its role was the strongest tool of a non-price competition always has increased repeatedly. By means of corporate advertising not only inform to buyers the information about potrebitelnyh properties of the goods, but also
Form trust to the commodity, price, marketing policy, aspiring to create an image of firm, as «good citizen» that country in which market the businessman acts in foreign trade.

Illegal methods of a non-price competition concern industrial espionage, peremanivanie the experts possessing industrial secrets, issue of the goods, outwardly nothing differing from items-originals, but it is essential the worst on quality, and therefore usually on 50 % of cheaper, purchase of samples for the purpose of their copying.

Primary factor price and a non-price competition is competitiveness of the goods and services as on competitiveness, such factors as quality of the goods and services and ih'tsena mainly influence.

More detailed classification is resulted in the Appendix 5. [4, 50]

The given qualification in a sufficient measure allows to describe processes of management competition, however has unduly theoretical orientation that hinders its use in managing practice. Besides, does not consider feature of a competitiveness in trade, both wholesale, and retail.

According to the author, the competitiveness in retail trade can be classified as follows:

1. From the point of view of a competitiveness subject

Struggle for market segments of end users;

Struggle for; trade channels;. •

Struggle for channels of deliveries.

2. By criterion of the manufacturer of the goods:

Struggle between the goods of domestic manufacturers;

Struggle between the goods domestic and imported because of


Struggle between the imported goods.

3. On struggle methods:

The price;

Not price which is in turn divided on grocery and assortimentnuju;

Carried out. Through expansion offered ♦ the list of additional services.

4. From the point of view of the anti-trust legislation:

The diligent;

The unfair.

As specific line of a competitiveness one more sign on which it is possible to qualify a competitiveness can serve in retail trade:

5. From the point of view of levels of a retail chain:

Between retail dealers of one level of a retail trade system; between retail trade system levels;

Between retail and negotiants;

Between the next channels of distribution (adjacent spheres of business)

Certainly, that in the given classification we have transferred not everything, but only especially significant directions.

Feature of a competitiveness in retail trade - a competitiveness goes any more between the independent companies, and between the whole systems of on-line operated networks (corporate, operated and contractual) which struggle among themselves for decrease in expenses and attraction of consumers.

The following question requiring consideration - how is carried out influence of specificity of retail trade on a competitiveness in the given branch.

Features of sphere of retail trade which we have considered in the previous paragraph, make versatile impact on a competitiveness in the given branch, so and on competitiveness.

All spheres of retail trade considered above feature and difference of retail businesses make versatile impact on a competitiveness in the given branch, so also their influence on competitiveness variously and ambiguously.

It is the most expedient to allocate two basic directions of a strategic and competitive policy of retail dealers, within the limits of each of which specificity of retail trade is considered, however it is necessary to pay attention that character of influence of these features hardly enough differs.

The first direction is connected with definition of that place in a marketing network, which takes a retail business, and also scales of influence, which it renders (or can potentially render) on the given network. Certainly, it not the unique direction, is inherent it and its features of strategic management and specificity of management competition are inherent in a wholesale marketing link, but a retail marketing link only. Being based on data which are resulted in the drawing 1, operating retail marketing division should investigate a number of the indicators influencing a place of its organisation in a marketing network and to decide for itself, what scales of its influence on this network.

1. Quantity of levels in a distributive network of each goods.

Well-known, that the more long and razvetvlyonnee the channel tovarodvizhenija, the

More difficult and confused structure is accepted by set of economic relations between participants of a marketing network. Especially it concerns the bottom levels which just and retail concerns, along with especially small wholesale.

The given characteristic directly influences such characteristics of the market of resellers as narrowness of the market, its transparency, quantity of consumers and narrowness of established communications between the supplier and the retail consumer that is naturally reflected in competitiveness level.

2. Structure of market participants at each level from the point of view of their type of trade, specialisation, the size, organizational-legal forms, branch network development, etc.

Naturally, in the pure state work of the retail consumer on one only level meets seldom, therefore the author will evaluate only prevailing operations. Sometimes on the goods which act as accessories, by-products or consumables for other branches, it makes sense to define structure of dealers of adjacent spheres of activity (business spheres). The chain of the channel of advancement will be divided, crossing and uniting with adjacent spheres, each sphere will correspond to that direction in which the firm realising production can potentially work. Besides, it makes sense to analyse the given potential directions more full - those branches which for today are not retail consumers of certain production, but can potentially become them.

3. Level on which the investigated firm works.

Correct definition of level gives the chance to us to define scale of influence of the investigated company on the market as a whole. The more close to the manufacturer it is (to distributive network top), the bolshee influence it has and the more than its potential in a question of possibility of rendering of influence nj the market and increases in this influence.

Retail dealers, increasing the trading potential and excepting wholesale intermediate levels, can potentially serve as grave-diggers of one of intermediate levels of a marketing chain, completely having appropriated both their volumes of purchases, and their additional margin.

4. Structure of participants at level of the investigated organisation. In what degree they are competitors for a seller's market, and sometimes and for channels of purchases how their shares what their specialisation, etc. are distributed?

For reception of true data, in detail enough described in the special literature, for example the classical scheme of research of the competitors is carried out in G.L.Azoeva's works [3, 4] or R.A.Fathutdinova [90]. But any classical textbook does not give a technique as much as possible considering specificity of retail trade, and after all this branch for today by estimations of experts most investitsionno is attractive and should draw more steadfast attention of experts of a high level.

Specificity of research of a competitiveness consists in retail trade that besides traditional questions on competitors, it is necessary to answer a question: «they are guided By what level of end users, what their task force?» It is frequent enough at incorrectly certain task force retail businesses compete not only to the enterprises of the category, but also are exposed to competitive effect from the enterprises of other category. I.e. one of competitiveness kinds in retail trade - a competitiveness between various levels of a distributive chain.

5. Existence of alternative methods of purchases.

Paradoxical situations when purchase of production at the intermediate negotiant can be economically more favourable to the retail consumer - more low the price are frequent enough in retail trade, It is better than a condition of deliveries, etc., unconditionally, aggravates a competitive situation, on the one hand, and with other creates enough • a paradoxical situation at which each, the goods assortimentnoj matrixes of the retail consumer have the quantity of participants of a distributive chain that forces to compete the retail consumer at different levels of a distributive network that does competition especially difficult and multiplane.

6. Availability blank nnsh in a retail trade system of the given goods.

Such niches representatives of one level of allied industries or representatives more a high level (more often jobbing) own branch, but having possibility to advance the company goods (to become a part of its channel), but for whatever reasons at present its not using can be, first of all. For example, «the goods for the house» or "essential commodities" very often enter into grocery networks. At the analysis of competitors reception of the given information presumes to choose as development strategy - strategy of care from a competitiveness in the branch or with search of new seller's markets.

Answers to these questions give primary submission about a strategic item of firm and conditions of its work, in a cut of that place, which enterprise

Takes in tovaroprovodjashchej to a distributive chain. After realisation of the similar analysis it is possible to define a competitive item of the retail dealer, on the basis of these given to produce the further strategy of the retail dealer on increase or deduction at former level of competitiveness and degree of the influence on all commodity distribution network.

For today working out of strategy of development of the company as strategy of increase of competitiveness is not typical for the Russian market, more often the problem by strategy working out costs as in the classical textbook on economy: «to Maximize profit or a sales volume», thus strategic marketing is limited to a standard set of widely known receptions which will be considered more low.

The second direction of strategic and competitive activity of retail dealers is connected with allowance for those specific features which are inherent in branch to retail trade and the retail trade enterprises, with the obligatory account of that influence which is rendered by the given specificity on a competitiveness in branch and competitiveness of the enterprises acting in it.

For possibility to make complex judgement, the most expedient are represented to tabulate all data about the given features (the Appendix 6)

Resulted in the Appendix 5 it is possible to make some conclusions of the table:

1. Practically all features of the retail market and retail businesses influence a competitive situation in branch and allocate with its corresponding specificity.

2. It is possible to carry to key elements of specificity:

• Features of retail consumers;

• Features of the market of resellers;

• a demand Duality: end users and jobbing consumers;

• Fulfilment of a role of a communication link;

• Retail trade owing to practically perfect competitiveness in the market is a basis of market self-regulation;

• Absence of own production, issue possibility

Production «without factory».

3. The allocated specificity has different degree of influence on

Competitiveness of the enterprises of retail trade and, as a rule, depends from • •

Features of the market, ' however, among all set forth above it is possible to allocate a little the basic. These are those features which have the greatest influence on competitiveness of retail businesses and at the same time reflect
Specificity of retail trade., First of all, it is necessary to carry to such directions:

• construction of an effective system of channels of distribution;

• the organisation of effective interaction with consumers;

• an establishment of close mutual relations with the consumer;

• a constancy of availability of the goods in a warehouse;

• the organisation of the effective scheme tovarodvizhenija.

• an establishment of close relations with suppliers.

Only work on increase of competitiveness of each of the given directions will bring growth of competitiveness of a retail business.

In conclusion of the given chapter it is possible to make some conclusions by results of the carried out research:

1. Retail trade is a basis of such important sphere of public reproduction as distribution.

2. Forms of the organisations of retail trade are rather diverse, however the in the lead role among them belongs to independent retail dealers on which share the majority of operations in retail trade sphere is necessary.

3. In modern market conditions the increasing role of retail trade consists in effect on manufacturers for the purpose of an intensification of production of the goods meeting real requirements of consumers (with the given purpose issue of the goods under the trade mark of the retail dealer (private label is adjusted)), for the purpose of increase of conformity of a supply and demand in the given market;

4. The retail trade sphere has the certain specificity connected with features of retail consumers, features of the market, dual character of demand considered by the retail trade enterprises, a role of a transfer link and a regulator of market relations which are played by retail dealers.

5. In connection with the strengthened position of economy of Russia and substantial increase of investment appeal of sphere of retail trade the special urgency is acquired by a question of increase of competitiveness of domestic trade enterprises.

All aforesaid has caused a choice of an objective of this research: working out scientifically - methodical and practical recommendations about efficient control trade enterprises for the purpose of increase of their competitiveness.

For achievement of the formulated purpose it is necessary to solve the following problems depending on it: to analyse and open specificity of the trading
Branches to reveal the features distinguishing retail trade from other spheres of business and to define factors of competitiveness of retail trade enterprises with allowance for specificity of the given kind of business; to develop a method of valuation of level of competitiveness of retail trade enterprises; to develop algorithm (the methodological approach) to management of competitiveness of retail trade enterprises; to generate a method of the organisation of system of the distributive logistics, directed on achievement of competitive advantages by trade enterprise; to develop a method of valuation of a management efficiency system of marketing logistics of retail trade enterprises


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A source: Batsanina Irina Aleksandrovna. Improving the competitiveness of enterprises on the basis of improving the organization of distribution logistics. Thesis for the degree of candidate of economic sciences. Moscow - 2005. 2005

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