Changing Phase of Department Stores and Discount Stores in the United States

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Running head: RETAIL MANAGEMENT
Retail Management
Institution
Name

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RETAIL MANAGEMENT
Introduction
This piece of work will discuss the changing phase of department stores and discount
stores in the United States of America. It will start by defining these two terms: department
stores and discount stores.
Definition of Department Stores and Discount Stores
A department store is an establishment of a large retail which has a wide range and
variety of goods set under one roof and is organized into several separate departments (Ikeler,
2016). These departments can be divided into groups of products such as foods, household
textiles, electrical appliances, ready-made clothes, and furniture, just to name a few, and the
departments are supervised by managers. On the other hand, according to Reimers (2014), a
discount store is a large retail business that sells its goods at a price which is lower than that of
other retail stores. Discount stores tend to lower their prices due to their distribution methods
which are efficient. The efficient methods make use of strategies and tactics such as cutting
margins of profits, maintaining high volumes of sales, negotiating wholesale prices which are
lower, ensuring expenses are very minimal and availing off-season goods.
Discount stores which specialize on a certain type of retail goods are commonly known
as category killers while those which are only open to a specific group of people such as
cooperative members or employees in the government are called closed-door discount stores
(Coibion, Gorodnichenko and Hong, 2015). The difference between a department store and a
discount store is that a discount store sells its goods at a lower price than other retail stores in the
vicinity while a department store sells its goods without any discount. In addition, a department
store offers its merchandise under one roof with a wide assortment of goods while a discount
store may not avail a wide range of goods under one roof. However, a discount store may have
several departments and is hence mostly known as the discounted department store (Des Rosiers,
Theriault and Dube, 2016).
Evolvement of Department Stores and Discount Stores in the United States
The department stores of the United States of America have over a century been pillars of
retail. Department stores such as Saks and Bloomingdales were established in the 1800s. They
have been serving consumers in the country efficiently for many years. The United States’

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RETAIL MANAGEMENT
department stores have developed in such a way that consumers can shop right from their homes
without moving to the stores. However, due to the high rate at which discount stores are
developing at has made many shoppers to lose the willingness to venture into department stores.
In fact, a department store known as Macy’s had recently reported and announced that it would
close about forty of its stores because of the poor sales that they were experiencing. For this
reason, the traditional department stores are putting all efforts and measures possible in order to
enter into the current digital age. They are trying to use new strategies in order to excite and
entice customers to shop at their premises (Sternquist and Goldsmith, 2018).
Macy’s, Hudson’s and Marshall Field were the biggest three department stores long ago
in the 1960s. They led in terms of volume of sales as well as in terms of their physical size. As
time moved, Hudson’s increased its employees to about 12,000 and the shoppers as well
increased to about 100,000 per day. Most of the United States’ department stores deal with goods
such as clothing, beauty, furniture, electronics, bed and bath, books, baby gear and art and crafts.
Macy’s, Kohl’s, JC Penney and Nordstrom are some of the large establishments of retail in the
United States which offer products that are of a wide variety in various several departments such
as home goods, apparel, cosmetics, accessories, electronics and sporting goods (Rose et al.,
2014).
Retailers have been greatly relying on giving discounts in order to propagate sales and to
make shoppers buy products from their in-stores as well as online. Discounting is a very
effective way of stock shifting but if a retailer over-uses it carelessly, it can change the way the
customers view him or her hence violating the reputation and bringing the business down. Before
offering documents, a retailer should consider other means which can also bring value to the
shoppers. A retailer should have employees who have experience and expertise in the handling
of customers. (Bolton and Shankar, 2018). Good and reliable suppliers should be connected to
the retail for a proper, continuous and reliable supply of products. Retailers would have a bright
future if they understand the needs of the shoppers. Some retailers in the United States have
started planning on how to acquire information about customer history of shopping, their history
of website surfing and other customer behaviors in order to offer what customer best requires.
They consider customer’s history of browsing sessions for the purpose of determining the exact