Trade, in a general sense, entails the buying and selling of goods and services. It involves the trade of goods and services from nearby shops in the locality, which may be departmental stores, multiple shops, or any other shop or mall. So it is clear that any product or service purchased or sold within the national boundaries is purchased from a store nearby. These stores are of various types. So it creates confusion many times. Out of these stores, we will discuss what the difference is between a departmental store and multiple shops.
A departmental store works in Proper coordination, control, and management are possible under this. It is because it operates under a single roof, and multiple shops are a complex structure and difficult to manage. This was one of the criteria for distinction. Apart from this, there are various distinctions that we will cover in this article.
Departmental stores vs. Multiple shops
A departmental store is a place where goods are available for sale. It is a huge showroom that deals in retail sales and consists of multiple departments functioning at a specific location. In a departmental store, every departmental has its functions limited to a specific extent. So every departmental is a complete unit; here, each departmental is a separate shop.
Contrary to this, it includes various branch shops that are owned by a business enterprise. These shops are located at various locations in the city and country. They are not specialized in every line of products but in a few. Here we will discuss the differences between departments and multiple shops.
Difference between departmental stores and multiple shops in points
|Parameters of comparison||Departmental store||Multiple shops|
|Meaning||Departmental stores are places where a large number of departments coordinate with each other and work together in a specific area||Multiple shops are those shops that have established several branches. These branches are located in different locations|
|Variety of products||In a departmental store, a large variety of products are available to customers as options.||Multiple shops offer a single product line or single type of product.|
|Area||You can easily reach out to a departmental store in the city in large buildings. It is to attract a large audience.||You can easily find multiple shops in every prime locality of a city|
|Initiated by||A departmental store is a retail organization||A multi-shop is a manufacturer|
|Capital investment||A large amount of capital investment is necessary||Less capital is required for establishing multiple stores|
|Marketing and advertising||In departmental stores, we often see local advertisements because they are generally located in one location.||Advertising for multiple shops is done nationally, as it covers a large area of the country.|
|Purpose||The purpose of a departmental store is to make available a wide range of goods to fulfill the needs and wants of consumers||to make similar kinds of products available at the same price to every customer|
|Price||The price in departmental stores is not fixed, which means that a customary item may be charged differently in one departmental store.||The price or rates which are charged for the commodities in multiple shops is fixed for everyone.|
What is a departmental store?
A departmental store is defined as a big retail outlet in which a host of products are provided to customers for sale through separate departments working under the same roof. In the departmental store, each departmental works as a sole shop. They deal in a particular line of goods and make themselves special in that line. For example, there are departments for footwear, clothes, cosmetics, books, groceries, and others.
It follows an organized and centralized structure in organizations. So, the top management of the organization has full control over operations in every department. But it is important to consider that every departmental operates as an individual sales department. Various types of departmental stores include lifestyle stores, Croma, D-Mart, Pantaloons, etc.
A departmental store plans and caters to the needs and wants of various customers. They are generally those who are not price-sensitive. These customers want more varieties. Simply put, we can say that a departmental store fulfills the needs of all those who care more about service quality. Contrary to this, multiple shops fulfill the customer's needs, but in a limited way. Especially those who are price-sensitive customers. It offers goods to every customer who likes to buy quality products at a fair price.
It has the objective of providing a range of services and products to customers to fulfill their needs under a single roof. It is different from multiple shops in that it aims to provide the same things and same-category products at a fixed and uniform price to various consumers who live in different locations.
Various features of departmental stores are
Larger in size: various departmental stores are located in a metropolitan organization. It can be found in a prime area of the city to attract a large number of people.
Wider in the range: In departmental stores, you can find different types of products and services in a single store.
Organized by department: Here, we can find a lot of departments, and all departments of the organization sell and specialize in their lines of product.
Centralization of management: It is a combined retail organization. Here, all the departments working under the organization are under central control. The purchase system is centralized. It means that the purchasing departmental of an organization marks all purchases.
Extra services: a lot of allied services, toilets, restrooms, restaurants, post offices, public transport, home delivery service, etc.
Company: As the size of departmental stores is large, it acts and operates as a joint stock company.
Warehouse and showroom: A departmental store performs the tasks of retail as well as a warehouse outlet.
What are multiple shops?
Multiple shops are shops that generally have a large number of similar retail outlets present in different locations of the city or country. They are chains of multiple retail shops that are owned and managed by a single organization. In the USA, multiple shops are also called chain stores.
Multiple shops of a specific brand that have similar appearance and facilities We call these shops multiple stores." Generally, we don't get to see multiple shops in densely populated areas. Further, they operate with all branded and standardized products, which usually have a high turnover.
The head office of the organization provides guidelines for all the branches of the organization to work in coordination.
Moreover, the plans regarding shop decoration and window dressing are the same at all the shops. The head office of the organization decides the price. So, all the branches provide goods at a fixed price as per the instructions of the head office.
Some examples of multiple shops are BAT, Raymonds, Bata, PUMA, Titan, etc.
Various features of multiple stores
Specialization: These shops specialize in one or a few very specific product lines. Further, a lot of types of products from that particular product line are available.
The convenience of the consumer: Various shops put forth efforts to fulfill the convenience of customers. They work by setting up branches, which are generally found close to the residences of consumers.
Common display: The decoration and window dressing of the chain shops are similar in each branch of the multiple shops.
Quality: The stores here sell items of necessity or important items that are branded. Further, various items don't require much effort to sell.
Purchase centralization: The head office of the multiple shops takes purchase decisions for all multiple shops to maintain equality in items that are sold at showrooms opened at various locations. So, there is the procurement of the stock for various outlets. Moreover, the goods are dispatched to various departments as per the requirements.
Selling method: All branches of the multiple shops work independently in their sales. The reason for this is that they work in different localities.
Uniform pricing: Every branch provides products at a fixed price. They follow the fixed price policy, and the price is the same for every branch.
Control of Head Office: The head office controls every branch and departmental and manages the function. The heads of these stores create the policies of the subsidiary departments.
Difference between departmental stores and multiple shops (in tabular form)
- Various points explain the difference between a departmental store and multiple shops.
- A departmental store is predominantly centrally located, and due to this, it attracts a large number of customers. On the other hand, multiple shops are not centrally located but scattered throughout the city, and they try to reach out to nearby customers.
- When we talk about departmental stores, their losses are not easy to set off. But in the case of multiple shops, the losses caused to multiple shops can be easily offset against the profits. It is managed with the profits made by other branches.
- Products available in a departmental store are from different manufacturers. But multiple shops deal in those products produced by one manufacturer.
- Window dressing is preferred and emphasized in a departmental store, as is internal decoration, to get more customers. But multiple shops have a uniform and simple layout undertaken by all the branches.
- Managerial control is good and better, and good coordination is also ensured in the departmental stores as all staff works in one place. But in the case of multiple stores, It cannot be coordinated properly because the workers employed are working in different locations.
- A greater risk is present in departmental stores because everything operates under one roof. The risks of multiple stores are considerably reduced because of the different branches of the multiple stores.
- There is always a uniform price in multiple shops. But in the case of different departmental stores, the price charged may be different even when the product is the same.
- A departmental store is a place that requires more money to operate. It increases the operation's cost. Multiple shops need less money to operate, which reduces the operation cost.
- Departmental stores generally offer credit facilities to their loyal customers, but multiple shops generally don't offer credit facilities to their customers.
- Generally, departmental stores provide after-sales service to their customers. This includes installation services and other facilities; on the other hand, multiple shops don't provide such services.
- A departmental store is bifurcated into several departments as per the nature and type of products. But multiple shops are a single store, and no division is made into various departments.
- When we talk about customers in a departmental store, high- and middle-class customers are more enticed in departmental stores, but multiple shops generally have middle- and low-income groups and local people are the regular customers.
All in all, in both the cases of departmental stores and multiple shops. These types of enterprises and their authority lie under the control of management of the organisation, which is the top management. It signifies that in an organization there exists a specific departmental that performs the acts of accounting and purchasing. Such departments are created for particular acts. Also, both of these operate on a large scale, and both require huge amounts of investment for the establishment. A departmental store offers allied services and facilities to their customers, like reading rooms, restaurant toilets, etc. But the allied services and facilities are generally not offered to customers in multiple shops.
Apart from the above discussion, we have discussed various other points that will help to know the difference between departmental stores and multiple shops, such as the fact that departmental stores are mainly situated in central locations, which is why they attract more people. On the contrary, multiple shops are not located in the center but are scattered throughout the city, and it attempts to fulfill the demands of nearby customers. These are some important distinctions. In the same way, we have discussed a lot of points in the article. We hope that this article will help you understand the difference between departmental stores and multiple shops clearly and easily.