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- Online English Lesson Plans, Lesson Material and Ideas for "Culture of
English Speaking Countries Lessons", Xiangtan Normal University...
WESTERN CULTURE AND SOCIETY: THE UNITED KINGDOM (UK) -
What is Retail?
Manufacturers need to sell their goods to the consumers. There are many
different ways of distributing goods. The manufacturer may sell goods
directly to the consumer, or may sell to a wholesaler (see next section).
The wholesaler can then sell the goods directly to the consumer or to a
retailer. If the goods are sold to a retailer they can be bought by the
consumer in the shops.
It is easier for manufacturers to sell to a few wholesalers rather than have
to sell directly to the consumers or to retailers. There are many advantages
to using wholesalers, these include:
Bulk Buying -
Large amounts of products purchased at the same time, reduces cost
Storage - The
wholesaler will store the goods, so the manufacturers own warehousing
costs are reduced
Risk - The
manufacturer reduces their risks, as the goods are purchased and stored by
the wholesaler before being sold to the consumer, so if demand is reduced,
the manufacturer has still sold the products, it is the responsibility of
the wholesaler to sell the goods.
Retailers - The
retailers can deal directly with local wholesalers, reducing costs etc.
Credit - Wholesalers
may offer credit to the retailer to finance the purchase of stock. Some
wholesalers offer "Cash and Carry" outlets, where discounts can
be offered for large purchases paid for in cash.
Many wholesalers will deliver directly to the retailer
Some businesses now miss
out the wholesaler, because retailers may be large and have adequate storage
facilities they may act as a wholesaler and retailer.
Delivery and Transport
goods are transported by truck in the UK. Many retailers own their own
lorries or vans or they may rent them. The lorries normally have advertising
on the outside to display a product or retailers details. Some goods are
transported by rail, such as coal etc. but most retail goods are by truck.
Many retailers will
deliver goods direct to your home in the UK. Especially heavy or large
goods. When purchases are made using the internet, retailers will deliver
the goods direct to your home, using their own delivery service or
alternatively a delivery company.
British Retail Outlets
There are many small shops or independent retailers in the UK, they often
specialise in one product or service, such as a local hairdresser. However
their importance in retailing has declined because many of them can not
compete with the larger retailers. (Many independent retailers are run as
Sole Trader organisations).
A department store may exist as a single shop or may have a chain of stores.
These stores contain many different departments, selling many different
products, such as food, toys, furniture, clothing etc. all in one shop. They
normally provide high quality products supported by a high level of service.
Large shops with many branches are known as superstores, they are normally
Public Limited Companies (PLC's) and sell a wide range of goods, which may
be specialist such as just clothes or just food etc. or may sell a variety
of goods. Food supermarkets are a type of specialist store.
There are many shopping centres in the UK - large areas which have many
shops, usually undercover, there are normally many hundreds of shops in a
large shopping centre. There are also many retail estates with a mix of
shops for the public as well as trade centres.
there were many small local shops selling food, newspapers etc. These shops
were on the corner of many streets in the UK. People would shop for other
goods at the local "High Street" a place where many retailers
would sell goods.
In the last 20 years
many retailers have grown in size and require very large shops. Due to the
high cost of High Street shops the retailers started to build
"out-of-town" shopping centres or shopping estates. because many
people in Britain drive a car, or have access to a car the out of town
locations became very popular. Retailers could have much larger shops and
were able to store much more in their own warehouses, so reducing costs to
The supermarket chains
all now have very large out of town superstores where people usually do one
big shopping trip each week.
Because the out of town
shopping locations have become very popular there is now concern about the
amount of traffic to these locations. The government are currently reviewing
the policy of building out of town shopping centres.
Key facts about British
There are 2.9
million people employed in retailing
11% of Britain's
workforce is employed in retailing
spend £3.85 billion pounds a week on shopping
By the end of 1999
there were 2,462,500 retail employees in Britain
for 1 in 9 of the UK workforce
During 1999 retail
employment provided 58,400 new jobs (22% of the total)
more than 321,000 outlets in the UK
accounted for 23% of GDP in 1999
Retail in the UK
represented £200bn in turnover in 1999
Each household in
the UK spends an average of £144 per week in retail outlets
non-alcoholic drinks make up the biggest proportion of average weekly
household spending in retail outlets, at 31% of the total
The UK has a
population of 59 million people, representing over 24 million
61% of the
population is of working age. From this group, 79% is economically
There is a wide use of
self service in British retailing, customers select their own products and
take them to the payment desk. Some shops might have sales assistants to
advise on products, but most shops are self service.
Most purchases are made
using Credit Cards or Debit Cards. Cash is normally used for smaller
purchases, such as a can of soft drink or a magazine.
The British Retailing
Consortium (BRC): As the ‘Voice of British
Retailing’, the British Retail Consortium (BRC) expresses the views of its
members and keeps the press, parliamentarians, consumers and many other
opinion formers informed about issues in the retail sector. The BRC has had
an office in Brussels since the early 1990's. Its role is not just one of
gathering early intelligence but it also ensures the voice of British
retailers is heard in the EU institutions. It also plays a key role in
ensuring there is better recognition of the retail sector.
BRC Brussels has
identified a number of priority areas. These are:
European Food Safety
Waste of electrical
and electronic equipment
packaging and packaging waste directive
Credit card fees
Food Standards Agency (FSA):
Retailers source food globally and want global risk assessment of food
safety issues. The BRC is keen that the UK Food Standards Agency should give
authoritative opinion on scientific issues. It should also be outward
looking, working in particular more openly and closely with key regional and
global agencies on food safety assessment and management issues. The BRC is
fully supportive of the Agency role in giving an expert and independent view
on matters relating to food safety, food standards and nutrition. The FSA
should use its new powers to monitor new food legislation and ensure it is
consistently enforced throughout the UK.
Information on nutrition
and the safe handling of food: Retailers offer
a wide range of foods at various price levels to reflect product quality, so
a wholesome, nutritious diet is available to all, whatever their income
level. Retailers have long since developed labelling systems for their own
brands which give customers far more information than the legal minimum on
nutritional content of pre-packed foods. Larger retailers also make
available information via customer leaflets or the company magazine on such
issues as healthy eating and the safe handling of foods. More concise
information is given for those with particular nutritional needs, such as
those intolerant of or allergic to certain foods. Now retailers are
experimenting with new technology to explore whether websites, call centres,
hand-held scanners and touch screens can improve customer information. The
prime responsibility for educating the consumer about healthy eating and the
safe handling of food remains that of the Government, although retailers
will usually be pleased to support government in their work, e.g. by making
government leaflets available in their shops, time and logistics permitting.
Food: British retailers will consider the sale
of GM foods or foods containing GM ingredients, provided they have approval
from the regulatory authorities and where they have confirmed a clear
customer demand. Such demand could arise from the offering of food that is
allergen-free, or has an enhanced nutritional content, or perhaps an
improved taste or keeping quality or a lower price.
In January 1998, British retailers started to label as genetically modified
all Soya and maize derivatives in processed foods from supply streams
believed to contain GM product. EU legislation was only introduced for
labelling of pre-packaged foods with effect from September 1998 and for food
sold in catering establishments from 19 September 1999.
BRC aims to ensure the UK legal and institutional framework develops in a
way that encourages, facilitates and stimulates the growth of electronic
commerce as an extension of existing trading activities such as mail order,
telephone ordering, direct marketing and other televisual and interactive
media opportunities. Self-regulation will play an important role, since a
retailer's good reputation is vital to his business and his brand. This
technology will facilitate global trading probably more in
business-to-business transactions initially than in business-to-consumer.
Nevertheless, the consumer protection measures that will be taken in the
name of crime prevention and security should not be burdensome on business.
British retailers have a good reputation for delivering lower prices to
their customers. Yet in recent years, they have been accused of charging
more for basic grocery and household goods than their counterparts in
continental Europe and the United States. The accusations have been driven
by a series of shopping basket comparisons which have appeared in the
The accusations are
based on superficial comparisons, disregarding the factors that contribute
to prices. They ignore the fact that UK shop price inflation has been
consistently below the Retail Price Index. Similarly, the accusations have
disregarded the host of methodological problems which affect international
Supermarkets' prices have come in for particular criticism in recent years.
However, the domestic data again demonstrates conclusively that food prices
have fallen significantly relative to overall prices during the last decade.
Food prices have risen by less than overall prices in seven of the last 10
years, and each of the last three years. Overall, the 28% rise in food
prices compares with 38% rise in the 'all items' Retail Price Index.
Differences in sales
taxes: There are significant differences in VAT and other sales taxes
(notably duty on tobacco and alcohol and electrical components) across
Europe. In the UK, shop price labels include sales taxes whereas in the US
they generally do not.
In many product areas,
British retailers face higher supplier prices than their overseas
counterparts. For example, the recent McKinsey food retailing study found
the UK food processing sector to be some 25% less productive than that in
the US. UK food retailers face higher input prices as a result.
British retail property
is notoriously expensive, with its cost compounded by often onerous and
restrictive lease arrangements. According to Morgan Stanley, "space
generally is around twice as expensive in the UK (compared with mainland
Europe), partly reflecting the tight planning regime and the lack of
available good quality retail space".
Turning to transport
costs, UK vehicle excise duty is more than three and a half times the
average for the rest of the EU, and more than twice as high as in the US. UK
fuel duty is more than twice the average for the rest of the EU, and more
than seven times as high as the US.
The over-riding point is
that even if significant price differences can be demonstrated between
Britain and elsewhere, the significant cost differences between countries do
not lie with retailers and indeed are largely outside retailers' control.