Meaning and Definitions of 'Multiple or Chain Shops'
The multiple shops are such a system of the retail trade in which many shops undertake to sell the products of one and the same type under one single ownership and management. These shops are opened with the objective of checking the exploitation of society by the intermediaries and for making the products available to the consumers on fair or reasonable price. Ordinarily, only such things are sold in these shops which are manufactured by its original producer. In these shops, similar type of decoration, and the same price of the products is found to be existing. In our country, the examples of such shops are Bata Shoe Company, Singer Sewing Machine, Delhi Cloth Mills, etc.
Various scholars have differently defined the 'multiple' or `chain' shops, in the following background :
In the opinion of J. Stephen, In a multiple shop, there are ,many shops of the similar kind whose ownership vests in the hands of one single business firm.
In the views of P. D. Conners, The various retail shops, being run under one single ownership and management, are known as the multiple shops.
In the opinion of S. E. Tliowas, It is such a system of business which comprises of innumerable retail shops whose ownership vests in the hands of one single individual and these shops are situated in various different towns of the country and deal in the Commodities of the similar kind.
Characteristics of Multiple Shops
From the above-given views and definitions, the following features or characteristics could be laid down:
(1) Sale of the Things Directly to Consumers. In this system there is no intermediary and the consumer could directly purchase the goods from these shops.
(2) Cash Sales. All the commercial dealings in these shops are done for cash only. Credit facility is not provided to the customers.
(3) Sale of Items of Common Use. The products of common or general use only, are sold in these shops.
(4) Uniform Prices Throughout. The products, sold by the multiple shops, are supplied on one single price throughout. Difference in prices might occur due to the local taxes.
(5) Sale of the Standardized Goods. From the point of view of size, quality and price, the products sold by these shops are of a standardized type.
(6) Central Production Workshop. The production of the commodities or products, sold by the multiple or chain shops, is undertaken in one central factory or workshop.
(7) Central Management System. These shops are situated or located in various and different parts of the country and there is a sales manager of each shop. But there is the control of central managers on all the shops.
(8) Similar Decoration and Appearance. In this form of retail trade, in every shop there is the similar type of decoration, display of items, furniture, and method of sale and publicity system.
(9) Decentralized Sales System. In these shops, the sale of things (products) is undertaken in different parts of the country.
(10) Central Purchase System. In these shops, the purchase of things is undertaken by the central purchase managers.
(11) Centralized Ownership. In this method of business, only the central office is the owner or proprietor of all the shops.
Organization of Multiple Shops
The organization and management of the multiple shops is based upon the capital organization, since these require huge capital amounts. All the shops work under the charge of one central office. For the management of each shop, a manager is appointed. Under the supervision of the manager, there are many salesmen who sell the goods to the consumers. The goods to be sold, are supplied to all the shops by the central office. The sale of goods is only on the cash basis and the sale, proceeds of the whole day are deposited in the bank account. For the salary of the employees and other sundry expenses, the office separately sends the cheque.
The account of all the branches is maintained by the office. The shop proprietor, from time to time, releases all the information and other particulars regarding his branch. Every shop maintains its separate account, and informs the head office regarding the stock and goods. The price is uniform and similar at all shops. From the convenience point of view, the sale price of all the items or commodities is labeled and sent by the head office.
All the shops of the country are divided into some zones. In each zone, with the help of the inspectors or supervisors, the regional manager holds the control over the shops. Enough attention is paid to the internal and external decoration, etc. of the shops.
Merits of Multiple Shops
(1) End of Intermediaries and Availability of Products to Consumers on Fair Price. In this system of retail trade, due to the production on large-scale, the products are available to the customers at lower prices. Moreover, the commission otherwise payable to the salesmen too is saved.
(2) Least Bad Debts. In this system, due to only the cash sale of the goods, there doesn't remain any sort of the chance of bad debts.
(3) Economy in the Publicity Expenses. In the multiple shops, advertisements are undertaken together for all the shops, hence there is economy in the advertisement expenses, too.
(4) Sales of Standardized Goods. These shops resort to the sale of only the standardized goods. Hence, the customers are not put to any inconvenience in selection of the products.
(5) Benefits of Large-Scale Production. These shops enjoy all the benefits of the large-scale production.
(6) Reduction in Distribution Costs. Due to economy in the advertisement expenses, the marketing costs also go down.
(7) Appropriation of the Stock of Goods. The items, not sold on one shop; could easily be transferred to the other shops.
(8) Easy Recognition and Strong Confidence of Public. Due to the external and internal decoration being almost similar, the masses could easily recognize these shops. Moreover, due to the uniform price of goods everywhere, the public holds a strong confidence in these shops.
(9) Consumers' Convenience in Purchasing Goods. These shops are the closest to the customers, hence, the customers are facilitated in making purchases of goods from these shops.
Demerits of Multiple Shops
(1) Deal in Only Selected Goods. In these shops only a few selected items are sold. They don't meet all the needs of the customers.
(2) Lack of Personal Services. As compared to that of the departmental stores, no personal service is rendered to the customers by these shops.
(3) Problem of Control. Under this system, the shops are situated in different cities of the country and the foreign lands. It therefore creates the problem of holding control over them.
(4) Lack of Individual Freedom among the Employees. The employees are required to completely observe the orders of the central office. Hence, the employee -:, are unable to i un the shops successfully.
(5) Need of Excessive Finance. Ai 4 compared to the ordinary retail shops, excessive capital is required for undertaking business under this system.
(6) Lack of the Facilities of Credit Sales. There shops do not provide credit facilities to the customers.
(7) Non-Availability of Customers' Favorite Items. Under this system, only the standard items are sold. Hence these are unable to attract the customers ,f the varied tastes.
(8) Greater Loss on Changes in Demand. Due to the sudden change in the products of these shops, excessive loss has to be faced.
Multiple Shops in India
As compared to the advanced countries, this system of retail trade has not made much progress in India. Due to the causes like lack of capital, lack of efficient salesmen, ignorance of masses, etc., there is the scarcity of shops of such type Along with the industrial development of the country, their bright future could be anticipated. Simple, illiterate and ignorant consumers are cheated by the intermediaries. The manufacturers too have not laid any stress upon the development of such shops but the masses have welcomed these shops. Extensive scope is there for the development of such shops in the country.
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