You are currently viewing What do you mean by merchandising? Describe its key elements. Describe different roles of the merchandiser in the retail business.

What do you mean by merchandising? Describe its key elements. Describe different roles of the merchandiser in the retail business.


The merchandise word has been coined from the old French word, ‘merchant’which means goods. Merchandising means the buying and selling of goods with a motive to earn profit. The Oxford Advanced Learner’s Dictionary defines the word ‘merchandise’ as goods bought and sold or trade goods. According to Business Dictionary, ‘merchandise’ refers to goods and commodities sold at the retail level. Merchandising focuses on the buying, presenting, and selling of merchandise. This includes all related activities such as advertising, display, and promotion of merchandise involving the retail customers. According to American Marketing Association, merchandising is the planning involved in marketing the right merchandise at the right place at the right time in the right quantities at the right price. To this definition, we can further add “marketing to the right target customers.” This addition may give a completeness to the merchandising process. Many Retailers would vouch for achieving the perfect balance among the right merchandise, right place, right time, right quantity, and right price as a great challenge. Retailers who can achieve them are surely successful in their venture. Grace Kunz has tried to capture the essence of merchandizing when he defines merchandising as the planning, developing, and presenting of product lines for identified target markets with regard to pricing, assorting, styling, and timing. Nora Aufreiter et al. have tried summarizing the concept of merchandising very succinctly as follows: ‘Merchandising is not a synonym for the buying function, it is an integrated, end-to-end business process that runs from planning the assortment, to sourcing, to distribution, to allocation of the goods to the stores, to promoting and selling the assortment to the customers and finally to replenishing inventory as necessary


The other activities that make merchandising effective, such as advertising, displaying, creating an attractive ambience, harmonious reception of the visitors i.e. prospective customers. In fact, Merchandising is the art of marketing the right merchandise at the right place at the right time in the right quantity at the right price. The success of the merchandising lies in these five ‘Rights’. In the absence of these five rights, the retailer cannot be successful in his endeavor. Different authors have emphasized different points in the context of merchandising. For example, Grace Kunz has emphasized on the planning, developing and presenting of the product lines to the target markets with regard to the styling, assorting, timing and pricing. Lewison on the other hand has advocated that merchandising is the process of developing, obtaining, pricing supporting and communicating the retailer’s merchandise offering. 


According to Walters and Hanrahan, (Retail Strategy, Planning & Control), the

Retailer must take strategic direction in the four key elements i.e. Merchandise

Strategy, Communication Strategy, Customer Service Strategy, and Format and

Environment Strategy. Let us learn them in detail.


Merchandise Strategy: A merchandise strategy is based on the concept of

targeting the right people with the right merchandise at the right time at the right  place. Here the right people mean the right customers the retailer wishes to target.The right place implies that the store should have sufficient floor space and an  appropriate ambience. Depending on the location of the store and the inhabitants, the  retailer will offer the appropriate quality and the pricing of the merchandise.

Communication Strategy: Effective communication is very important for a

successful merchandising. It requires an effective strategy – a coherent plan of

action. It should take into account the goals and objectives of Retail Firm, the

features of the Products and Services and the environmental condition.

The marketer makes an effort to persuade wholesale and retail channel members to  stock and promote certain products. He/she tries to enforce that the consumer  demands certain products or brands from retail channel members.

Customer Strategy: Customer satisfaction is the utmost important for a successful retail enterprise. A high-quality customer service must be provided on the reception  desk itself. It requires excellent communication skills of the Retail staff. The  employees must be patient while dealing with the customers. They should have  excellent listening and telephone skills. They should be able to solve and prevent  problems of the customers soft skills. There should be mechanism of feedback from  the customers.


Format and Environment Strategy: Retailers are making use of customer  creativity, technology and processes to develop new strategies for store format. They   are focusing to delight customers by ensuring that the right products are delivered to store shelves. They are making effort in such a way that, the space is being managed  well. At the same time, they should possess adequate right staff is deployed to  provide an appropriate level of customer service.

From the above key elements, it is observed that Merchandise Strategy is going to be  the most crucial one. This strategy will substantially influence the other three  elements mentioned above. Whether it is to decide on communication or customer  service or the store format and its ambience, all these three key elements will have to   be taken into account. The above strategies will also facilitate to retain the loyalty of    the customers.



 The role of merchandiser has gone into tremendous transformation from the historical time. Traditionally, merchandisers were really performing more a role of a merchant selling different kinds of merchandise to different towns and villages in the same country or in another country. It would be interesting to look at the historical roles of a merchandiser as explained here below.

1 Role of Merchandiser in Historical Times

2 Role of Merchandiser in an Export Business

3 Role of Merchandiser in a Retail Business

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