UNIT 2 Module I

UNIT TWO
BUSINESS AND COMMERCE

27

OBJECTIVES: After studying this unit, you should be able to:

o o o o o o o define the functions of commerce explain the commerce system define home/domestic trade and foreign/overseas trade understand and explain channels of distribution understand the difference between wholesaling and retailing know some trends in present-day retailing understand and practise language: gerund and infinitive, some adjectives and prepositions

MODULE I LEAD-IN
1. 2. 3. 4. 5. What is commerce? What commercial services do you know? Examine the role played by commercial workers in the light of the statement: Commercial workers produce nothing. Give reasons why the distribution of goods is as important as their production. What problems face the exporter which do not exist in the home trade?

WHAT COMMERCE IS ABOUT

As a human activity commerce is concerned with the study of trade i.e. the moving of the goods from the seller to the buyer and the aids to trade, of the business units which provide goods and services. The goods are almost always produced far away from the place of consumption and their way from the producer to the consumer is long and very complicated. Therefore, it is the function of commerce to offer a link between the stages of this process and the necessary instruments to make it work. The main functions performed by commerce are as follow: Trade is the basic commercial activity. It is essentially the exchange of goods and services between producers and consumers. Trade consists of home/domestic trade including wholesale trade and retail trade, and foreign/overseas trade dealing with import and export trade. But commerce includes more other functions in addition to trade. Distribution involves getting goods from the manufacturer to the consumer. Without sophisticated systems for storing goods and selling them to the consumers, it would be impossible for firms to find customers for their goods. Banking and financial services offered by banks and other institutions assist commerce by providing loans and other services which allow business to function and invest in future production, and enable consumers to purchase goods and services.

28

Business Issues

Communications, in both written and electronic form, allow firms to order and sell their goods efficiently and cheaply. No transaction is possible without communications. Transport is concerned with the moving of goods by land, sea or air as well as the means necessary to do it. Insurance allows risks to be taken without fear of loss. It gives security and stability to commerce as it enables the business people to survive losses by damage, shipwreck, fire, burglary etc. Without adequate insurance many enterprises would be too risky to undertake. Advertising also plays an important part as it enables firms to let prospective customers know their offer. It includes a wide range of forms from hand-distributed leaflets to highly sophisticated television commercials.

VOCABULARY
aid n. = ajutor, mijloc goods n. = m\rfuri consumption n. = consum link n. = verig\, leg\tur\ therefore adv. = a[adar, deci exchange n. = schimb home/domestic trade n. = comer] interior foreign/overseas trade n. = comer] exterior wholesale trade n. = comer] angro retail trade n. = comer] cu am\nuntul to deal with v. = a se ocupa cu in addition to adv. = `n plus, pe l>ng\ to involve v. = a presupune, a implica to store v. = a depozita warehouse s. = depozit customer s. = client to assist v. = a ajuta to enable v. = a da posibilitatea to purchase v. = a cump\ra, a achizi]iona order s. = comand\ to order v. = a comanda insurance s. = asigurare loss s. = pierdere damage s. = stric\ciune, defectare shipwreck s. = naufragiu burglary s. = spargere, jaf prospective adj. = poten]ial, posibil offer s. = ofert\ leaflet s. = prospect commercial s., adj. = film de reclam\ comercial\, comercial

COMPREHENSION I
1.1. Answer the following questions: 1. Explain the meaning of the terms: a) commerce; b) trade. 2. What is the usual definition of commerce? 3. Set out carefully the main functions and sub-functions of commerce and give an idea of the importance of each. 4. What is meant by commercial services? 5. Could you underline their importance to the economic life of Romania? 6. What is considered the usual way of distribution? 7. What is the difference between a wholesaler and a retailer? 8. What does import trade deal with? 9. What does export trade deal with? 10. Why is insurance so important to businessmen or businesswomen?

UNIT 2 Module I
PRACTICE I

29

2.1. Give synonyms for: commerce, commercial, foreign trade, home trade, to provide, to enable, aid, to assist, prospective, customer, link, goods. 2.2. In each of the following questions there is only one right answer: Mass production is possible only if: a. there is a wide market for increased production. b. customers will pay a high price for the product. c. the raw materials required are found locally. d. a lot of unskilled workers live near the factories. The term producer refers to one who: a. provides raw materials or food. b. grows crops or manufactures goods. c. adds value to a product. d. advertises goods or services for sale. Which one of these statements is false? a. Every stage of production employs commercial services. b. Commercial services cannot begin until the manufacturing processes have been completed. c. If there were no commercial services most goods would not be produced. d. Commercial services add value to products. Which one of these statements is true? a. A wholesaler insists on cash payment from his customers. b. A wholesaler is a connecting link between the retailer and manufacturer. c. A wholesaler deals only with manufacturers. d. A wholesaler sells cheap goods to the householders on their door steps. 2.3. Match the following words with their corresponding definition: 1. 2. 3. 4. 5. 6. 7. 8. goods services profit turnover stock producer goods/ industrial goods consumer goods commodity a) b) c) d) e) f) g) h) the moving of the goods from the seller to the buyer the amount of money that is made by a business, e.g. when it sells something for more than it costs articles of trade or commerce; wares, merchandise; products as opposed to services the work provided for others as an occupation or a business items such as food or clothing produced for the final consumer items meant to be used in producing other products the rate at which goods are sold and restocked any specific market where consumers buy goods, such as a shop, a store, a merchant, an agency, an open-air stall

1.

2.

3.

4.

30
9. 10. consumer outlet trade i) j)

Business Issues
an accumulated supply of goods; to keep a supply of goods 1. a raw material such as grain, cocoa, coffee, wool, cotton, rubber 2. a good regarded in economics as the basis of production and exchange

2.4. Explain and comment on the diagram below:

THE COMMERCE SYSTEM

2.5. Describe the commodity composition of Romanias foreign trade by using the prompts below: non-manufactures (food, beverages and tobacco, basic raw materials, fuels); manufactured goods: semi-manufactures (chemicals, textiles, iron and steel, nonferrous metals, metal manufactures, building materials); finished manufactures (machinery, equipment, clothing and footwear, research instruments ana apparatus etc.), miscellaneous.

FOCUS ON LANGUAGE PRACTICE II

3.1. The gerund may function as the subject of a verb, the object of a verb, or as the prepositional object after a prepositional verb, a phrasal verb or a prepositional expression.

MODEL:
1. 2. 3. Closing the factory means putting people out of work. He hates speaking to strangers. He apologized for disturbing her.

UNIT 2 Module I
Now complete the sentences below using gerunds: 1. That company specialized in 2. After the customer left the shop without 3. The manager doesnt take any interest in 4. He should be accustomed by now to English food. 5. The manufacturers were asked to devote all their energies to exports. 6. Restraining home demand is the key to our exports. 7. There is one thing I dislike about her: she will never admit to a mistake. 8. Having almost run out of money, we were reduced to in a cheap hotel. 9. It is difficult to see how the company can avoid another loss this year. 10. The job will entail your to different parts of the country. 3.2. Replace the words in italics by a gerund construction MODEL: I didnt recall that he had said any such thing. I didnt recall him/his saying/having said any such thing. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

31

I dont remember that I promised to help you. She didnt even acknowledge that she had received the invitation. The shoplifter admitted that he had stolen the goods. I cant imagine that the sales manager would ever agree to such a proposition. The professor suggested that I should try the examination again the following year. She doubted that he was sincere in his beliefs. The eye-witness reported that she had seen a dark figure outside the bank at the time of the hold-up. A group of retailers has advocated that the government should set up a special commission of inquiry. He denies that he was there on that occasion. They anticipate there will be no problem in getting a loan from the commercial bank. 3.3. Combine the sentences below by using the appropriate preposition with the ing form of the verb: MODEL: He is sorry. He always arrives later than his fellows. He is sorry for always arriving later than his fellows.

1. 2. 3. 4. 5.

Mr. Black was disappointed. He had not been elected chairman of the company. Mike was very sorry. He didnt receive any reply to his application letter. Susan was upset. She had missed so many opportunities to get a higher pay. The sales representative was angry. He had to write a report on his work performance during the previous year. Brenda is ashamed. She hardly ever manages to put pressure on slow payers.

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Business Issues

3.4. Rephrase the following sentences keeping their meaning unchanged. Use the verbs and phrases given in brackets followed by correct prepositions and a gerund 1. I think we ought to change our pricing policy. (think) 2. We must launch the new product by June. (insist) 3. They always try to give good advice to their prospective customers. (make a point) 4. Our company has always been able to forecast what their customers want. (succeed) 5. Im delighted our sales have been much higher this month said the Managing Director to the Sales Manager. (congratulate) 6. The shopkeeper is very pleased when his customers are satisfied. (take pleasure) 7. The new multiples have managed to attract fashion-conscious customers. (to be successful) 8. They are making efforts to improve their warehousing facilities. (concentrate) 9. The companys manager is confident that the bank will give him a credit to extend the chain stores. (depend) 10. He is considering giving his superstore a face-lift. (think)

COMPREHENSION II
& Read the passage below. Explain the meaning of the underlined words.

BRITAINS OVERSEAS TRADE

Although small in area and accounting for only about 1 percent of the worlds population, Britain is the fifth largest trading nation in the world. Overseas trade has been of vital importance to the economy for hundreds of years, and especially since the mid-nineteenth century, when the rapid growth of industry, commerce and shipping was accompanied by Britains development as an international trading centre. Exports of goods and services in 1994 were equivalent to about one-third of the gross domestic product. Britain is a major supplier of machinery, vehicles, aerospace products, electrical and electronic equipment and chemicals, and a significant oil exporter. It relies upon imports for about one-third of the total consumption of foodstuffs, and for many of the raw materials needed for its industries. Trade in invisibles is also of great significance to the economy. Britain has nearly always earned a surplus from its invisible transactions and there has not been a deficit since 1947. Transactions fall into three main groups: services (receipts and payments arising from services, as distinct from goods, supplied to and received from overseas residents); interests, profits and dividends ( income arising from outward and inward investment and other capital transaction); and transfer between Britain and other countries. (adapted from Britain An Official Handbook) a) Translate into English: 1. ~mi face deosebit\ pl\cere s\ accept invita]ia de a vizita expozi]ia dumneavoastr\ cu v>nzare. 2. Directorul a propus organizarea unei [edin]e cu `ntregul personal. 3. Proprietarul nu este interesat s\-[i v>nd\ nici unul din cele dou\ magazine. 4. Acesta poate fi un mod mai pu]in costisitor de a[i organiza depozitele de m\rfuri. 5. Ne g>ndim s\ cre\m (to develop) noi produse. 6. Var deranja dac\ a]i r\spunde la telefon `n locul meu? 7. Marile magazine au reu[it `ntotdeauna s\ satisfac\ cerin]ele clien]ilor proprii.

UNIT 2 Module I

33

b)

8. Nare nici un rost s\ pleci de vineri, fiindc\ [eful filialei noastre se a[teapt\ ca tu s\ fii acolo luni diminea]\. 1. Comer]ul depinde nu numai de activitatea comercial\ propriu-zis\, ci [i de o gam\ de servicii vitale pentru buna desf\[urare a acesteia, cum ar fi: distribu]ie [i depozitare, transport, servicii financiarbancare, asigur\ri, publicitate. 2. Comer]ul interior se ocup\ cu distribu]ia m\rfurilor `n interiorul ]\rii, `n timp ce comer]ul exterior se ocup\ de exportul [i importul m\rfurilor. 3. M\rfurile destinate comer]ului pot fi clasificate `n mijloace de produc]ie (producers goods) [i bunuri de consum. 4. Materiile prime esen]iale sunt tranzac]ionate la bursa de m\rfuri (commodity exchange).

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UNIT TWO
MODULE I KEY PRACTICE

Business Issues

2.1. trade, trading, overseas trade, domestic trade, to supply, to make it possible, assistance, to help, potential, client, connection, commodities/merchandise/wares. 2.2. 1. a; 2. c; 3. c; 4. b. 2.3. 1. c; 2. d; 3. b; 4. g; 5. i; 6. f; 7. e; 8. j; 9. h; 10. a.

PRACTICE II
3.1. manufacturing/selling; taking the goods, paying; expanding the business; eating; increasing; enhancing/increasing/spurring up; making; living/staying; making; travelling. 3.2. 1. having promised; 2. receiving/having received; 3. having stolen; 4. managers agreeing; 5. me/ my trying; 6. him/his being; 7. having seen; 8. the government/the governments setting up; 9. being/having been; 10. being. 3.2. 1. ating; 2. foring; 3. at/overing; 4. ating; 5. ofing. 3.5. 1. I think of changing our pricing policy. 2. We insist on launching the new product by June. 3. They always make a point of giving good advice 4. Our company has always succeeded in forecasting 5. The MD congratulated the Sales manager on having increased the sales. 6. The shopkeeper takes pleasure in satisfying his customers. 7. The new multiples have been successful in attracting fashion-conscious customers. 8. They are concentrating on improving their warehousing facilities. 9. He depends on the bank giving him a credit to extend 10. He is thinking of giving his superstore a face-lift.

UNIT 2 Module II
UNIT TWO
MODULE II LEAD-IN
1. 2. 3. 4.

35

Is the distribution of goods as important as the production of them? Why? Give your reasons. Is the wholesaler a necessary link in the distribution chain? What is the wholesalers fundamental role? What types of wholesaler do you know? Mention some of them.

WHOLESALING
Wholesaling is part of the chain of distribution: manufacturer wholesaler retailer consumer. It is the link between the manufacturer of goods and the retailer. The wholesalers fundamental role is to act as a middleman, buying in large quantities from manufacturers and breaking bulk by selling smaller quantities.

TYPES OF WHOLESALER
Consumer goods wholesalers They may be general stockists or concentrate on a particular item. A large number are cash-and-carry warehouses which do not deliver the goods or offer credit. Cutting out the costs of these services allows them to offer very competitive prices. Industrial wholesalers They are involved in distributing producer goods such as raw materials, components and machinery. These involve sales to firms rather than retailers, and are important to the economy. Agricultural wholesalers The traditional system for distributing agricultural produce depends upon an involved network of local markets.

SERVICES PROVIDED BY THE WHOLESALER

The wholesaler perform several functions during the distribution process: Breaks bulk. The wholesaler buys large amounts from the manufacturer and sells in smaller quantities to the retailer. This is called breaking bulk . Provides services for the manufacturer. By breaking bulk the wholesaler saves the manufacturer a lot of money and trouble. It would be difficult and expensive for the manufacturers to sell small amounts of items to thousands of different retailers. This would involve processing millions of orders every year, each involving sorting, packing and delivery. The wholesaler also takes responsibility for storing goods, and may help the manufacturers cash flow by holding reserve stocks of goods, especially helpful

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Business Issues

where there is seasonal demand. Provides services for the retailer. The wholesaler enables the retailers to buy in small quantities as the latter have limited storage space and credit. The wholesaler holds available stocks and may provide credit terms. Provides market information. Through contact with retailers and manufacturers, the wholesaler learns a lot about the demand for different products. The retailer learns about new products and suppliers from the wholesalers displays and sales literature. The main areas in which wholesalers are dominant are groceries and provisions, petroleum products, ores and metals. Grocery wholesaling has however greatly diminished in recent years; most groceries are now delivered direct from manufacturers to the large multiple food retailers, by-passing the traditional wholesalers.

VOCABULARY
manufacturer n. = produc\tor wholesaler n. = angrosist retailer n. = detailist in bulk n. = `n vrac to break bulk v. = a desface marfa consumer goods s. pl. = bunuri de larg consum stockist s. = agent/depozitar de stocuri cash-and-carry s. = v>nzare cu plata `n numerar warehouse s. = depozit to cut out v. = a reduce raw material s. = materie prim\ producer goods s. pl. = bunuri de investi]ii machinery s. = ma[ini industriale produce s. = produs (agricol); produse agricole to save v. = a economisi, a cru]a to pack v. = a ambala delivery s. = livrare cash flow s. = flux monetar seasonal demand s. = cerere sezonier\ credit terms = condi]ii de credit grocery s. = articole de b\c\nie display s. = expunere, prezentare, expozi]ie to by-pass v. = a ocoli to fill an order v. = a executa o comand\ drop shipper s. = angrosist care nu preia m\rfurile, ci se ocup\ numai de executarea comenzilor

COMPREHENSION I
1.1. Answer the following questions on the text: What types of wholesalers do you know? What is the basic function of a wholesaler? Name two wholesalers in your area. What services are provided by a wholesaler? Which are the main areas in which wholesalers are dominant? Can the wholesaler be by-passed? Study the following contrasting views of the activities of wholesalers and give your own opinion: middlemen are performing a useful function which helps everyone; middlemen are more likely to help themselves than help the public. 8. Which statement is true: Wholesalers in general: a) need a considerable amount of working capital; b) have very high overhead costs; c) deal only with manufacturers; d) incur very little risk. 1. 2. 3. 4. 5. 6. 7.

UNIT 2 Module II
PRACTICE I

37

2.1. Give nouns corresponding to the following verbs: to provide, to distribute, to produce, to manufacture, to consume, to wholesale, to retail, to stock, to deliver, to supply, to pack, to save, to display, to by-pass. 2.2. a) Combine the word terms with the nouns below and give the proper translation: credit, delivery, payment, contract; b) Combine the word sales with the nouns below and then translate them: average, account, analysis, assistant, audit, channels, check/slip, clearance, contract, department, coverage, figures, force, forecast, log, lady-woman, leaflet, literature, man, management, manager, message, note/sheet, pitch, potential, price, promotion, records, representative, returns, revenue, service, target, talk, tax, territory, value, warrant. c) Combine the word discount with the following nouns and translate them: cash, house, price, fidelity, quantity, quality, trade, store, market, rate. 2.3. Fill in the blanks choosing from the words in the box:

cash-and-carry chain discount demand

1. 2. 3. 4. 5. 6. 7. 8. 9. 10.

middleman overheads security

stock-control turnover wholesaler

The amount of money taken (without any deduction) or the amount of goods sold is the Deciding how many items should be ordered and when is a matter of A number of shops belonging to one company is a Shops possess safes for A wholesaler offers his goods at a to enable the retailer to produce a profit. A retailer buys his stock from a The costs of running a business caused by lighting, heating, rent, wages etc. are its The wholesaler is the between the manufacturer and the retailer. The everyday name for a warehouse from which a retailer collects the goods himself is There are industries where goods have to be made several months in advance of the main buying for seasonal 2.4. Fill in the blanks with the necessary preposition: There are a lot of people engaged the distributive and allied trades. The spread of home ownership has increased the demand estate agency services. Changes technology have also played a part the growth services. The cash-and-carry sector offers discounts customers who purchased bulk and limits expenditure premises, credit and delivery facilities.

1. 2. 3. 4.

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5. 6. 7. 8. 9.

Business Issues

New Covent Garden is the main market fruit and vegetables. The retailers are encouraged discounts and other incentives to buy as much as possible the wholesaler. Overseas trade services has also grown, and in 1994 overseas earnings services amounted nearly half the value of exports manufactures. There were a lot of books display at the Book show. Retailers are placing greater emphasis price competition a means promotion sales. 2.5. Make sentences of your own using the following uncountable nouns: accommodation experience knowledge plant advice equipment machinery travel business information news weather damage luggage money work research progress

FOCUS ON THE LANGUAGE PRACTICE II

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 1. 2. 3. 4. 5. 3.1. Replace the words in italics by an infinitive construction: The company has decided that it will close down uneconomic factories. The minister of labour agreed that he would meet the union leaders. He claimed that he had expertise in such matters. The chairman threatened that he would resign if his policies were not adopted. The management promised that they would raise the workers pay. They couldnt guarantee that they would meet all their customers demands. The employee pretended that he didnt understand the managers question. The sales manager resolved that he would increase the turnover next year. The buyer undertakes that he will pay on a stipulated date. The Arbitration Commission hopes that it will settle the dispute as soon as possible. 3.2. Complete the sentences with the infinitive of a suitable verb: They persuaded me my mind. She cant think what induced him his business at such a low price. The government appointed a committee the state-owned farms. Id prefer at home rather out in this weather. The shareholder is entitled dividends on his shares. 3.3. Write sentences based on the given facts, beginning your answers as suggested. Mr. Jones will be leading the sales mission to America. The sales manager thinks he is the best man for the job. (The sales manager has chosen ). The personnel manager is very strict on punctuality. (He expects ). John will never finish all this work by himself. (Shall I help ?). Tom has been terribly inefficient lately. I wonder whether he will keep his job any longer (The company will probably ask ). Id like some information and you are the only person to give it to me (I want ).

1. 2. 3. 4. 5.

UNIT 2 Module II
COMPREHENSION II

39

4.1. Read the text below and then give it an appropriate title. Summarize it in no more than 50 words. Some companies find dealing with wholesalers and retailers so problematic that they dream of doing away with them altogether. One firm that has done so is Family Frost, the cutely named subsidiary of Germanys Milchhof which is expanding its fleet of yellow-and-orange striped refrigeration vans across Central Europe. It is targeting countries where infrastructure problems should make consumers keen to have Family Frosts frozen goodies delivered to their door, avoiding the problems of trudging to poorly stocked and pricey shops. The theory seems to be working. The companys Mercedes vans have been criss-crossing the Czech Republic, Hungary and Poland for three years, and it is now looking hard at Slovakia, plugging the last hole in its Visegrad presence. The plan is to have 150 vans operating in the country within three years. The van fleet is only one part of the German ice-cream makers distribution plans, but for now Milchhof products are not yet sold in Slovakia. If a suitable partner can be found, Family Frost will consider using a local ice-cream manufacturer, with the goods marketed under the same Family Frost name as the more expensive German confectionery. General frozen foods vegetables, fish, meat and prepared foods will be sold alongside the ice-cream. Local suppliers are being considered because of punitive import taxes. On top of the standard import duty of 6%, a 10% surcharge is levied for consumer goods, making food imports hopelessly uncompetitive. Talks are being held with several Slovak manufacturers, and if they can meet quality control standards, production may well switch to them. If so, this will be a hand-off operation. The fleet is to be operated by franchises, each running 10 vans with Family Frost itself running one such fleet. The reasons for choosing francishing seem to be cost and motivation. (adapted from Business Central Europe) Translate into English: 1. El ajungea primul la birou [i pleca ultimul. (the first to come). 2. El s-a hot\r>t s\ se opun\ la toate propunerile noastre. 3. Profesorul dorea ca studen]ii s\i s\ `n]eleag\ clar conceptele economiei de pia]\. 4. Ne a[teptam ca ei s\ fie `ntrutotul de acord cu propunerea noastr\. 5. Nu e u[or s\ satisfaci cu promptitudine o asemenea avalan[\ de comenzi (rush of orders). Firma noastr\ `[i dezvolt\ `n permanen]\ re]eaua de distribu]ie. 2. M\rfurile ajung de la produc\tor la consumator prin intermediul angrosistului [i detailistului. 3. Uneori produc\torul `l ocole[te (to baypass) pe angrosist [i trateaz\ direct cu detailistul. 4. Depozitul este folosit pentru stocarea m\rfurilor. 5. Depozitele cu plata `n numerar (cash-and-carry) nu livreaz\ m\rfurile [i nu ofer\ credite, iar acest lucru le permite s\ practice pre]uri competitive. 6. Comer]ul angro cu articole de b\c\nie a sc\zut `n ultima vreme datorit\ magazinelor multifunc]ionale (multiples), care trateaz\ direct cu produc\torii. 7. Exist\ [i un alt tip de angrosist (the drop shipper), care nu intr\ niciodat\ `n posesia m\rfurilor (to take possession of), ci doar (merely) preia comenzile (to take orders) pe care produc\torul sau furnizorul le execut\ (to fill) direct c\tre client.

a.

b.

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UNIT TWO
MODULE II KEY PRACTICE I

Business Issues

2.1. provision, distribution, production, manufacturer, consumption, wholesaler, retailer, stock/stockist, delivery, supply/supplier, packing/packer, saving, display, bypassing. 2.3. 1. turnover; 2. stock control; 3. chain; 4. security; 5. discount; 6. wholesaler; 7. overheads; 8. middleman; 9. cash-and carry; 10. demand. 2.4. 1. in; 2. for; 3. in, in, of; 4. to, in, on; 5. for; 6. by, from; 7. in, from, to, of; 8. on; 9. on, as, of.

PRACTICE II
3.1. 1. to close down; 2. to meet; 3. to have; 4. to resign; 5. to raise; 6. to meet; 7. not to understand; 8. to increase; 9. to pay; 10. to settle. 3.2. 1. to change; 2. to do; 3. to privatise; 4. to stay, to go; 5. to receive/to get. 3.3. 1. 2. 3. 4. 5. The sales manager has chosen Mr. Jones to lead the sales mission to America. He expects everybody to be punctual. Shall I help him to finish it? The company will probably ask him to quit. I want you to give me some information.

UNIT 2 Module III

UNIT TWO
MODULE III LEAD-IN
1. 2. 3. 4. What is the difference between retail and wholesale? What types of retailing do you know? Who are the major retailers in your area? Do they specialise in specific items or do they sell a variety of goods?

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RETAILING
Retailing is often defined as the sale of goods in small quantities to the public. It also includes services, such as repairs or dry-cleaning. The retailer is the last link in the chain of distribution between the manufacturer and the consumer. The retailers task is to provide consumers with the goods and services that they want at the right time, in the right form and quantities, in the right place. A retailer performs a series of functions, such as: anticipate consumer demand by stocking adequate amounts of goods, stock a variety of types, brands, sizes and prices of goods, choose goods which are suitable for the demands of his/her customers, provide information about the goods and services on sale, open at times which suit the consumers, sort, pack and display goods attractively, provide a pleasant atmosphere for customers, accept the most common methods of payment, provide and arrange credit, arrange delivery, provide after-sales services etc. A retailer may buy directly from a manufacturer, or from a jobber, a person who then sells to a retailer. Retailers are usually classified according to the number of shops or outlets they have. These are the major types of retailing found, in one form or another, around the world: Unit shops They are also called independent shops or simple outlets. They are usually sole traders or partnerships. In recent years they have faced tough competition from the large chain stores. Supermarkets A supermarket is a shop of over 2,000 square feet, selling mainly food and household goods. Supermarkets generally sell a wide variety of packaged and branded goods. The larger shops also sell a variety of non-food items. They concentrate upon selling at lower prices than those of unit shops. Multiple stores (multiples) Multiple stores consist of large numbers of shops (at least ten), also known as chain stores, owned by one firm. They usually sell a wide variety of items and are called variety chain stores. Some of them operate from out of town locations with parking facilities, known as either superstores (over 20,000 square feet) or hypermarket (over 50,000 square feet).

42

Business Issues

Multiples have several distinguishing features, such as: competitive prices, selling the same range of goods, located in popular sites in town centres or important suburbs, similar layout and display, centralised buying of goods, extensive advertising campaigns, their own national training of staff. Department stores They are sometimes described as being several shops under one roof. The most famous is Harrods in London. They are organised in departments, each with its own manager. Department stores are usually located in city centres. Co-operative retail societies They are owned and operated by local groups of farmers or other consumers; they are also called Coops and are popular in rural areas, marketing such items as groceries, animal feed, petrol (gasoline), and food preparation services. Their chief attraction to consumers is the patronage dividend, based on volume of purchase over a given period. Direct retailing It is also called house-to-house, door-to-door selling and makes up a large part of the retail business in certain products, particularly household items and make up. Vending machines They sell many types of small-sized, low-cost, popular-demand, standard-quality goods. They are usually installed in high-traffic areas.

VOCABULARY
task s. = sarcin\ to perform v. = a realiza, a `ndeplini brands s. = marc\ de fabric\, marc\ comercial\ on sale s. = la v>nzare for sale s. = de v>nzare to pack v. = a ambala to display v. = a expune, a prezenta, a etala method of payment s. = metod\ de plat\ jobber s. = intermediar, agent outlet s. = debu[eu, vad comercial mart s. = centru comercial tough adj. = dur, aspru, ne[lefuit foot,(pl. feet) s. = 1. picior; 2. unitate de m\sur\ 30,5 cm household s. = gospod\rie location s. = amplasare site s. = amplasament layout s. = aranjare, dispunere to market v. = a comercializa to own v. = a poseda chief s., adj. = 1. [ef; 2. principal patronage dividend s. = dividend pentru `ncurajarea clientelei purchase s. = cump\r\tur\, achizi]ie discount house s. = magazin cu v>nzare pe baz\ de rabat mall s. = parc de distrac]ii care are `n incita sa [i centre comerciale de mari dimensiuni hypermall/megamall s. = centre comerciale foarte mari

UNIT 2 Module III

COMPREHENSION I
1. 2. 3. 4. 5. 6. 7. 8.

43

1.1. Answer the following questions: What are consumer outlets? What is a retailers task? Give four services a retailer may provide for his customers. Describe and contrast the chief characteristics of two of the following types of retail outlets, retail cooperative stores, department stores, supermarkets, multiple shops. Explain why some retailers prefer to open shops in suburban areas rather than in town centres. Describe two features of a supermarket which are not usually found in a small shop. To whom is a patronage dividend paid? From what source? Where are vending machines found? What do they sell?

PRACTICE I
2.1. Give synonyms for: amount, to provide, right, variety, to perform, size, demand, customer, to display, shop, consumer outlet, unit shop, multiples, coops, discount. 2.2. Add a prefix or suffix to the following to given them the opposite meaning: food-products, suitable, appropriate, pack, expensive, competitive, relevant, essential, advantage, charge, similar. 2.3. Complete the following excerpt with suitable words from the box: likeliest expansion supermarkets operating discounting market responsible share market sales

Supermarkets are now 1 for 15 percent of the music and video 2 Their 3 may rise to 25 percent of sales by the year 2000. 4 have risen rapidly in the early 1990s. But Corporate Intelligence on Retailing warns that the 5 may be destabilised if 6 apply the same 7 tactics to albums and videos as they have to products such as petrol, clothing and cosmetics. It identifies record retailers 8 from small stores as the 9 victims of the supermarkets 10 2.4. Mark the following sentences true (T) or false (F): The local corner grocery store is a consumer outlet. There is no difference in distribution to industrial and household customer. q The selection of distribution channels takes into account all the components of the marketing mix. q Department stores are consolidation of many speciality shops under one roof. q Vending machines are used to sell any consumer item which will fit into the machine. q All intermediaries have no need to take into account geography in choosing their distribution channels. q

1. 2. 3. 4. 5. 6.

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2.5. Do the following multiple-choice test: If there are too few retail shops, prices may rise because: bigger shops spend more on advertising more shop assistants are needed for the bigger shops there is too little competition there are too few goods on sale A multiple shop organisation has many departments in one place owns many shops in different parts of the country selling the same goods has uniformity of name and style throughout the country must be owned by a cooperative society A retail cooperative society passes on its profits to its customers has its shared quoted on the Stock Exchange passes on its profits to its employees must buy all its goods from the Cooperative Wholesale Society

Business Issues

1. a. b. c. d. 2. a. b. c. d. 3. a. b. c. d. 4. a. b. c. d. 1. 2. 3.

A department store is: difficult to rech for people without cars successful in business where specialist knowledge and personal service is important a large building with several floors, sited in the centre of a large town a sole trader 2.6. Complete the following list of advantages and disadvantages for customers buying in superstores unit shops department stores Advantages a) b) c) d) a) b) c) d) Disadvantages

UNIT 2 Module III

FOCUS ON LANGUAGE PRACTICE II

45

3.1. Complete the following sentences using a gerund or an infinitive. Choose from the verbs in the box. buy, offer, develop, find, sell, organise, launch, do, comment, deal, do away, try. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Wal-Mart, the worlds largest retailer, started products over the Internet last year. The Internet can be a very efficient way of goods. He has always hoped a job in marketing. Its no use to persuade him to buy shares in that business. They used only software, but now they sell all types of computer equipment. The department head suggested a meeting for all the staff. new products will be their main goal next year. The chairman refused on the companys losses. Some companies find with wholesalers so problematic that they dream of with them altogether. They have made a terrible mistake by the new product without the necessary research.

3.2. Fill in the blanks with either a gerund or an infinitive according to the meaning. The text will help you: 1. The Internet can be a very efficient way your shopping. 2. Supermarkets have also started on-line and allow consumers some grocery shopping at home. 3. Many airlines and travel agents will let you at schedules and tickets on-line. 4. The more ambitious a retailer is the more likely it is a loss. 5. They are investing heavily in technology and marketing their business. 6. It doesnt cost much a tiny business. 7. The company saw its share price sharply yesterday after warning that earnings would fall far short of expectations. 8. At first information technology (IT) vendors didnt need about clients exact requirements. 9. IT managers cannot spend a single penny without the general manager. 10. Companies plan more on hardware and software. 11. Theres an impetus for Vienna to continue its markets. 12. The need for heavy capital investment underlines the difficulty of a distribution network from scratch.

46
COMPREHENSION II

Business Issues

4.1. Read the text. Use the dictionary if need be. Write a summary of the main ideas in the text.

RETAILERS: LOSERS SHORT-TERM, WINNERS LONG-TERM

Eurocommerce, the pan-European retailers body, estimates that European shopkeepers could be burdened with heavy costs in switching to the euro. Changing tills, computers, accounting practices and training staff could strip retailers of more than two percent of turnover or up to two years profit. As was the case when Britain introduced a decimal currency in 1971, sales could drop at the start. And coupled with the cost of fixing the so-called millennium computer bug, retailers face a stinging bill. But its not just the costs. Retailers will be in the firing line when the euro is launched because they will come face to face with a public grappling with the new currency. In the longer term, retailers will need to invest heavily to be sure of reaping the potential benefits of the euro. Aside from the most obvious benefits of reduced foreign exchange exposure and lower banking charges, retailers will gain from the competitive aspects of euro. The euro will bring greater price transparency allowing better sourcing. It will also drive down purchasing costs for retailers. A key barrier to expansion will be removed and retailers faced with sluggish or saturated home markets can tap fresh markets more easily. The competitive will have more opportunity to snatch market share from cushioned national players. With only one currency to contend with commercial transaction through the Internet and television will be easier. But fortune will favour the big in the age of the euro, and many benefits will elude small shopkeepers who do not have the muscle to make the leap across borders. (adapted from Reuters News)

a.

b.

Translate into English: 1. ~mi amintesc c\ am v\zut aceast\ reclam\ `n ziarul de ieri. 2. Trebuie s\ le amintesc s\ anuleze aceast\ comand\ `nainte de a fi prea t>rziu. 3. A[tept\m cu ner\bdare s\-l cunoa[tem pe noul director comercial. 4. ~ncearc\ s-o `ntrebi pe Jane; s-ar putea s\ te ajute. 5. ~mi displace s\ lucrez peste orele de program (to work long hours). 6. S-a str\duit s\ ne vorbeasc\ `n francez\, dar suna p\s\re[te (to sound Double Dutch). 7. Regret c\ am spus c\ nu e adev\rat. 8. Regret\m s\ v\ facem cunoscut c\ nu suntem mul]umi]i de marfa dumneavoastr\. 9. ~nceta]i imediat executarea comenzii. 10. ~n drumul spre motel sau oprit s\ viziteze noul supermagazin. 1. Cea mai renumit\ strad\ comercial\ din Londra este Oxford Street; aici se afl\ cele mai mari magazine universale din Londra. 2. Harrods este cel mai mare magazin universal din Londra, iar Selfridges este al doilea ca m\rime (second largest). 3. Unele lan]uri de magazine sunt amplasate `n afara ora[ului, `n centre comerciale de mari dimensiuni. 4. ~n prezent firma Marks and Spencer vinde o mare varietate de

UNIT 2 Module III

47

m\rfuri prin intermediul a 670 de magazine aflate pe `ntregul mapamond (worldwide). 5. Ei de]in 16% din pia]a britanic\ de confec]ii. 6. Cump\r\turile la domiciliu (teleshopping) devin din ce `n ce mai r\sp>ndite (widespread). 7. ~n ultima vreme magazinele individuale au trebuit s\ fac\ fa]\ unei concuren]e dure din partea marilor lan]uri de magazine. 8. La supermarket se v>nd `n general m\rfuri preambalate [i m\rfuri cu marca de fabric\ sau de comer] (branded goods).

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UNIT TWO
MODULE III KEY PRACTICE I

Business Issues

2.1. quantity, to supply, correct, range, tu fulfil, dimension, requirement, client, to show/to exhibit, store, specific market, individual shop/single outlet, multiple stores/chain stores, cooperative societies, reduction. 2.2. non-food, products, unsuitable, inappropriate, unpack, inexpensive, uncompetitive, irrelevant, unessential, disadvantage, discharge, dissimilar. 2.3. 1. responsible; 2. market; 3. share; 4. sales; 5. market; 6. supermarkets; 7. discounting; 8. operating; 9. likeliest; 10. expansion. 2.4. 1. T; 2. F; 3. T; 4. T; 5. T; 6. F. 2.5. 1. c; 2. b; 3. a; 4. c.

PRACTICE II
3.1. 1. offering, 2. buying; 3. to find; 4. trying; 5. to sell; 6. organising; 7. developing; 8. to comment; 9. dealing, doing away; 10. launching, doing. 3.2. 1. of doing; 2. to come, to do; 3. look, buy; 4. to make; 5. to expand; 6. to set up/start up; 7. fall; 8. to worry; 9. consulting; 10. to spend; 11. opening up; 12. establishing/setting up.