Small-Scale Retailing

A small scale retailing business is normally run as a sole proprietorship or as a partnership. The small amount of capital needed is raised from personal savings, or borrowed from friends and relatives. If the retailer has some collateral security, then he might be able to obtain some money from a bank in the form of a loan or an overdraft. Small retailers obtain a great variety of goods in small quantities from wholesalers. They are not able to go direct to the manufacturers since purchases are made in bulk. The sole proprietor normally serves his customers with the help of some assistants. Therefore, he has the opportunity to get to know his regular consumers well.

In the present day retail market, the large retailers seem to be attracting customers away from many of the trading city- centre shopping areas characterized by the small specialist shops selling the traditional shopping items- textiles, cosmetics, cameras, radios, watches and the like. This is because the large retailers are able to offer very competitive prices and a congenial shopping atmosphere equipped with the necessary facilities for the convenience of the average as well as a wide range of goods to ensure one stop shopping for practically every member of the family. However, despite these factors, the retail market is still characterized by a predominance of the small retailer, especially in the smaller towns as well as the city centre.


To be more successful means to increase one's net profit. This could be achieved by increasing turnover whilst reducing wastes, e.g.: unnecessary expenses, loss of interest due to money being tied up in excess stocks, poor credit terms given by the supplier, etc. in practical terms, it means that the retailer has to re-examine the following points concerning his business.

• The location of the shop
• Can the service be in improved in order to build up some good will to secure a regular market?
• Are prices competitive enough?
• Is the quality of goods worth the pries charged for them?
• Does the seller have a good variety of goods to cater for the needs of all his customers?
• Is there still room for improvement in the layout and display of goods and in the cleanliness of his shop?
• Can he find better source of supply where he is able to obtain better discounts and terms of credit?
• Is it economically feasible to increase the advertising expenses?