Importance

The retail trade is important due to following reasons :

1) Vital Link :-

There are millions of consumers in the country. It is difficult for producers or wholesaler to reach to numerous customer. Therefore, retailers are vital link in the chain of distribution, to sell goods to numerous customers - scattered in different parts of the country.

2) Employment :-

Retail trade provides employment to millions of people in the country. After agriculture, retail trade is the second largest provider of employment in India. Employment is provided to people working in retail stores. Also, it provides self-employment for retail traders.

3) Large scale Production :-

Retail trade facilitates large scale production. Retail trade facilitates distribution of goods even in remote places. This increase demand for goods, which in turns enables large scale production.

4) Community Development :-

Retail trade facilitates community development of the locality in which the retailers operate. The retailers sponsor or provide donations to cultural and social events like local sports, festival celebration, etc.

5) Economic Growth :-

Retail trade increases demand for goods and services. Increase in demand results in more production. This helps to increase the national income or GDP of the country.

6) Services to Customers :-

The retailers provide a number of services to the consumers such as :

- Provides convenience in shopping.

- Offers personal services such as home delivery.

- Offers a wide variety of goods from several producers.

- Suppliers perishable goods, etc.

7) Services to Wholesalers :-

The retailers provide a number of services to the wholesalers such as :

- Provides advance.

- Undertakes packing and labeling.

- Undertakes standardisation and grading.

- Provides relief from direct sales to customers, etc.

8) Services to Producers :-

The retailers provide a number of services to the wholesalers such as :

- Provides customer feedback.

- Undertakes after-sales-service.

- Assists in sales promotion.

- Facilitates large scale production.