What Is Retail?

What Is Retail and Why You Should Integrate Software With It?

Retail point of saleThe basic explanation for retail is the sale of goods to the public for use or consumption rather than for resale. It involves the sale of goods from a single point (store, market) directly to the consumer in small quantities for their end use. Retailing is transaction of goods between the seller and the client as a single unit or in small quantities.

The retailer usually purchases goods in bulk quantities to be sold to the customer either directly from the manufacturers or through a wholesaler. It can be described by the supply chain.



What is Supply Chain?

Manufacturers / Wholesalers →

Retailer →

(sometimes referred as merchant)


(end user)

Manufacturers produce the goods with the help of machines, labour and raw materials.Wholesaler buys the goods from the manufacturer and sells them to the retailer in large numbers, but at a low price. The retailer purchases the goods from the wholesaler (or sometimes directly from the manufacturer) and then sells these products to end user in small quantities. The consumer buys his/her goods from the retailer in small amounts to satisfy his/her needs and demands. This process is also called shopping.


Most Common Retail Types

There are different types of retail ownership and they all have pros and cons. It can’t be said that one is better than the other because it depends on which kind of business people want to own.

  • Independent Retailer is someone who builds his/her business from the ground up (from the planning to opening day). Usually the owner does it all, but he/she may have assistants or hire someone extra.
  • Existing Retail Business. In this case, somebody inherits or buys an existing business and takes over the ownership and responsibilities.
  • Franchise is the right to use a name, product, concept and a business plan that is already created. It’s basically acquiring the rights for a proven business model.
  • Dealership. It’s a mix of franchise and independent retailer. Business owner has the license to sell a brand of products (usually there is a variety of brands). And, unlike franchise there are no fees to the licensor.
  • Network Marketing or multi-level marketing is a business model where the selling of products depends on the people in the network. On the one hand a person is selling products, but at the same time other salespeople are being recruited to sell the same goods.


Software for Retail

There are many benefits for a retailer to implement a point of sale systems for their business. It might seem intimidating to switch from traditional, hardware cash register to a POS system but we’ll give you some recommendations why you should do this.

  • It will provide you with valuable information. At the end of the day a  cash register will only show your cash flow. But computerized cash register will give you information about the money left in the cash drawer, and how much of that is profit. It helps you keep an eye on your inventory – which items were sold, their quantity, and how many products are left on the stock.
  • Better inventory management. Inventory reports will provide you with accurate information to make plans for orders. POS software will show sale trends, sales history, goods that are running low, goods that have stayed in the stock for too long, etc.
  • Accuracy. The system will automatically deduct discounts and show special prices. Your employees won’t have to keep a close eye on discounted prices because the system already does this.
  • Prevent theft. Employees are more alert and watch inventory much more carefully if they know that stock is being monitored.
  • Customer satisfaction. Your clients will be happier if you use bar-code scanners and other computerized tools to make checkout faster.
  • Customer database. POS software can store the names and contact information of your clients. You can use this list for newsletters or advertising.

Point of Sale software

You can choose a suitable retail point of sale system from a wide range of software. ERPLY Point of Sale, Oracle, SAP, Netsuite, Microsoft RMS, Epicor and many others that are designed to help your business.

Try it now!

About the author
Kristjan Hiiemaa
Entrepreneur building better POS and cloud-based retail management suite . Product guy. CEO & Founder of Erply.