DEPARTMENTAL STORES:

Examples: Harrods, Selfridges, Debenhams.

Features:

• It consists of many departments all in one building.
• Department stores are located in the centre of large cities.
• Each department is under the control of a manager and the head office controls all the departments.
• Each department specializes in one line of goods, for example, furniture, hardware, clothes, foodstuff, etc.
• Many conveniences to the shoppers including toilets, restrooms, saloons, telephone booths, car parking facilities, etc, are provided.
• Goods are pre-packed and the prices are clearly marked.
• Many department stores are owned by very large firms.

Advantages:

• The department stores buy goods from the manufacturers in bulk and are able to get discounts. Hence they can sell goods to consumers at competitive prices.
• They have large capital and are able to employ specialists in such matters as buying, publicity, window display, etc,.
• There is economy in advertising as all the departments are included in one advertisement.
• Losses sustained in one department can be absorbed in the profits made by other departments.
• More customers are attracted as conveniences such as lounges, restaurants, car parking facilities, etc, are provided.
• Shopping can be done under one roof. This makes it very convenient for customers.

Disadvantages:

• There are high overheads because of the many facilities provided. This increases the price of goods.
• As departmental stores are located in the centre of towns and cities, high rental charges increase the unit price of goods.
• There is very little freedom for individual departments as there is strict control from the head office.