Departmental stores are retailing institutions offering varieties of goods under one roof. There are several advantages of this type of stores such as large variety of products, proper customer service, benefits of bulk buying etc. and some drawbacks such as requirement of large investment, high price, no personal touch etc. This post points out some of the major advantages and disadvantages of departmental stores.
Advantages Or Benefits Of Departmental Stores
The main advantages of departmental stores can be highlighted as follows:
1. Shopping Convenience
Departmental stores offer large variety of consumer products at the same place. So, it facilitates the consumers to purchase all the goods they needed without moving from one shop to another.
2. Central Location
These stores are established and operated in the central location of city or town. It helps to attract more customers than other ordinary stores.
3. Wide Selection
Departments stores offer large variety of items of different, companies, brands, style, taste, design, quality etc. So, the customers can get better selection opportunity.
4. Benefits Of Bulk Buying
Because of adequate capital departmental stores can purchase goods in large quantity directly from producers. It reduces per unit price of the product and helps to maximize profit.
5. Customer Service
Departmental stores provide free delivery service, repair and maintenance service, credit facility, after sales service, telephone orders etc. to the customers. It increases customer satisfaction.
6. Efficiency
Departmental stores employ skilled, experienced, and trained manpower. It helps to increase operational efficiency of the business.
Disadvantages Or Drawbacks Of Departmental Stores
Some notable disadvantages of departmental stores are as follows:
1. Large Investment
It requires huge amount of capital to establish and operate departmental store. So, it is difficult for small investors to run such stores.
2. Distance
Departmental stores are situated in the center of the city or town. So, suburban people cannot avail the service of such stores.
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3. High Operational Expenses
It requires high operating costs to run departmental stores smoothly. Large sum of money is needed for staff salary, rent, decoration, advertisement, customer service etc.
4. High Price
Customers have to pay high price of goods in departmental stores than ordinary retail shops because of huge capital investment and high costs of operation.
5. No Personal Touch
It is difficult to make personal contact with customers because departmental stores are too large and sales are made by salesman not by the owner. There is a lack of individual attention to the consumers.
