A catalog merchant (catalogue merchant in British and Canadian English) is a form of retailing. The typical merchant sells a wide variety of household and personal products, with many emphasizing jewelry. Unlike a self-serve retail store, most of the items are not displayed; customers select the products from printed catalogs in the store and fill out an order form. The order is brought to the sales counter, where a clerk retrieves the items from the warehouse area to a payment and checkout station.
The catalog merchant has generally lower prices than other retailers and lower overhead expenses due to the smaller size of store and lack of large showroom space.
There are a few key benefits to this approach. By operating as an in-store catalog sales center, it could be exempt from the "Resale price maintenance" policy of the manufacturers, which can force conventional retailers to charge a minimum sales price to prevent price-cutting competition; it also reduces the risk of merchandise theft, known in the industry as shrinkage.
From the consumer's point of view, there are potential advantages and disadvantages. The catalog showroom approach allows customers to shop without having to carry their purchases throughout the store as they shop. Possible downsides include that customers may be required to give their contact information when an order is placed, take the time to fill out order forms, and wait a period of time for their order to be available for purchase. This wait may be days long, one of the chief vulnerabilities of the catalog showroom approach.
Consumers Distributing operated over 400 stores in Canada and the United States, and closed in 1996. Shop-Rite, which operated 65 stores in Ontario, closed its doors in 1982. Sears Canada Inc still issues over 15 printed catalogues every year. Included in these (15) printed catalogues are three (3) large catalogues - the Spring and Summer Catalogue, the Fall and Winter General Catalogue, and the popular Christmas WishBook catalogue. In fall 2012, Sears Canada catalogue will issue its 60th anniversary WishBook edition.
In the United Kingdom, the largest general goods retailer is Argos, a catalogue merchant. Former catalogue retailers include Littlewoods and Kays, which unlike Argos had no shops and sold only by postal orders. Littlewoods, Kays and existing Grattan built their businesses around offering credit, however in the 21st century most High Street shops now offer store cards (a means of credit specific to the retailer) meaning these catalogues have lost some of their market niche.
Littlewoods also ran a smaller catalogue that did not offer credit called Index. Unlike goods from the Littlewoods Catalogue, which were purchased via postal order, Index goods could be purchased at Index branches and some branches of the Littlewoods department stores.
Unlike Littlewoods, Kays and Grattan, who focused mainly on Clothing, Argos (and formerly Index) focus primarily on furniture, electronics and white goods. In 2001, Argos started a clothing catalogue called Argos Additions, however they sold the brand to Shop Direct Group in 2004.
Catalog merchants in the United States have declined since 1980, in favor of chain discounters, big box stores, and internet shopping.
The repeal of the resale price maintenance sanctioning law in 1980 meant that chain discounters such as Wal-Mart, KMart could set and change prices at will, in a more consumer- friendly environment where the customer can examine the goods and confirm availability before approaching sales staff. As a result, this retail sector went into decline in the 1980s. As big box stores and internet shopping became increasingly popular in the 1990s, the decline of the catalog merchant business accelerated.
Many companies in recent years have moved away from relying solely on catalog sales, augmenting them with on-line sales or direct retail. The move toward on-line sales includes long-established department store chains such as Sears and JCPenney that relied heavily on catalog sales. However, many long-established catalog merchants have gone out of business in recent years including Best Products, Brendle's, Ellman's, KeyMid, Montgomery Ward, Rink's, H. J. Wilson Co., Service Merchandise, Sterling Jewelry & Distributing Company and Consumers Distributing.
Nowadays, companies are turning their print catalogs to sell their products into online catalogs. This new trend is intended for consumers to shop on line and enjoy several discounts and some other advantages. A catalog supply website includes prices, discounts, tools, shipping options, different methods of payment, and more.
Online catalogs have several advantages for both the seller and the buyer. They allow the integration of the online catalog with the seller's order database and this translates into an additional sales channel. Online catalogs make it easier to find new clients on line without spending on more printing materials. These catalogs allow for more flexibility as they can be changed, corrected, and updated more easily.
However, even though sales can increase, an investment is also necessary to make online catalogs work successfully. This system requires adding a search engine friendly shopping cart system to the website and some kind of customer service might be necessary in the form of e-mail or live chat for instance. Some companies also invest on a toll-free number so their clients use this channel to place their orders.
The online buyer also benefits from online catalogs. This system usually offers good prices because the seller does not invest on large buildings or apparels and these savings are reflected in better prices for the consumer. Because the seller does not need to manage a physical inventory, they can offer an ample selection of products that cannot be offered by retail stores.
Another benefit is the convenience to buy from home. Buyers do not need to spend time or fuel to drive to one store and another looking for the products they need. This is an advantage for elderly people, impaired people, and also for people who already spend time and fuel driving from their works to their homes. Online catalogs also allow the buyer to compare prices and choose the articles that are more convenient for them any time and to place orders during the day or night.
Online catalogs can be enjoyed immediately as opposed to physical catalogs that one has to wait until they are mailed. Another advantage of these catalogs is that they are paperless, therefore, people using them do not litter.
One convenient aspect is that once one chooses what to shop and where to shop it, one can go immediately to the specific website and buy the article without wasting time trying to look for a specific item throughout the web.
For those people who still prefer a printed catalog, many sites offer the possibility to send a hard copy catalog as well.
There are also some disadvantages when this system especially with the shipping costs. Buyers have to be careful because at times shipping costs may end up increasing the costs of the products and reverting the original better price it seemed to offer.
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