What is Departmental Store? Meaning and Features

Meaning of Departmental Store ↓

A departmental store is a large retail trading organization. It has several departments, which are classified and organized accordingly. Departments are made as per different types of goods to be sold. For example, individual departments are established for selling packed food goods, groceries, garments, stationery, cutlery, cosmetics, medicines, computes, sports, furniture, etc., so that consumers can purchase all basic household requirements under one roof. It provides them maximum shopping convenience and therefore, also called as 'Universal Providers' or 'One spot shopping'. The concept of a departmental store first originated in France.

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All departments are run under the same ownership, management and control. Each department is an independent unit as far as a sale of any specific product and its varieties are concerned. The main aim of every departmental store is to provide and fulfill all requirements of their customers at one place along with comforts and facilities which a small scale retailer cannot provide. Here all goods which are available under one roof are sold on a cash basis.

Characteristics / Features of Departmental Store ↓

Following are the main features or characteristics of a Departmental Store :-

1. Departmental Store is located in the centre of a city

The departmental store is usually located in the central area of a large city. Location and premises are the two most important aspects for it. The departmental store is generally situated at that place where a maximum number of people comes for shopping.

2. Departmental Store offers a wide variety of goods

A departmental store not only offers a wide variety of goods and but also provides a huge range of designs, colours and styles that suit individual demands of consumers.

3. Departmental Store means shopping under one roof

The main idea behind a departmental store is to supply all basic requirements under one roof. It acts as a supplier of a large variety of quality goods and services. Thus, departmental store provides maximum shopping convenience to its customers.

4. Departmental Store offers quality goods and services

The motto of every departmental store is to provide high quality goods and render professional services to their customers. It always keeps a huge stock of fresh goods which highlight latest fashions and trends followed by different manufacturers.

5. Departmental Store has a single management

Various sections of the departmental store operate independently. However, they all are under direct control of a single management. Buying, supervision, accounting, advertising and external communications are handled directly by the central management of a departmental store.

6. Departmental Store always attracts customers

Departmental stores have attractive interior decoration and window display. They spend heavily on sales promotion. This is done through the advertising, discounts, special seasonal offers, gift schemes, festival offer, etc.

7. Departmental Store fulfil needs of most families

Departmental store mainly satisfies needs of the rich and higher middle class group of the society. More attention is given to quality, choice, convenience and service rendered to the customer.

8. Departmental Store renders good customer service

Departmental stores offer efficient customer services such as inspection of goods, actual demonstration of goods, convenient packages, provision for refreshment, reading rooms, home delivery, parking facility, etc.

9. Departmental Store operates by appointing experts

The departmental store conducts its business on a very large scale and generates good profit revenues. It can easily afford to appoint experts for purchasing, advertising, recruitment, supervision, etc., and keeps operating smoothly.

10. Departmental Store sells goods only on cash basis

A departmental store sells goods only on a cash basis. Generally, credit facilities are not offered to customers to avoid the risk of bad debts.

11. Departmental Store has a high operational cost

Departmental stores have to incur high expenses by way of rent, advertising, provisions of conveniences and facilities to its customers. Thus, costs of operation are high.

12. Departmental Store diffuses the risk of loss

The losses made by one department of a departmental store can be compensated by profits earned by other departments.

Thus, the risk of loss is diffused and hence reduced.