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HISTORY OF
RETAILING
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BARTER SYSTEM

• origin of retailing
• ancient method of buying and
selling of goods
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1521 – 1897 COINS & GALLEON
TRADE

• First and longest shipping line in the history

• A government monopoly sailing from Acapulco – Manila and
Manila – Acapulco
• Served as the main source of income for the Philippine colony
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Before Galleon Trade (Pre-Colonial)

Traders in the ancient world history includes Syrians, Jews, Arabs, Persians, Chinese, Malays, Indians,
Greeks, Europeans and more. Many different kinds of merchandise traveled along the Silk Road (ancient
network of trade routes during Han Dynasty; ancient world in commerce between 130 BCE-1453 CE; term
Silk Road was coined by German geographer and historian Ferdinand von Richthofe ). Paper, which had
been invented by the Chinese during the Han Dynasty, and gunpowder, also a Chinese invention, had a
much greater impact on culture than silk. Persia became China’s closest partner in trade, initiating cultural
exchange such as art, religion and philosophy which is the greatest value of the Silk Road. The closing of
the Silk Road forced merchants to take to the sea to ply their trade. Philippine archipelago formed the outer
edges of an established trade circle thaat extended from the Persian Gulf. It was at its most active from 7th to
9th century and antedated the European invasion in the 16th century. Chinese records from 671 contains
references to Persian ships. Later accounts including Japanese, Persians, Indians and Malays. By 851, this
trade route was well-established passing through Straits of Malacca. Of the precolonial Philippine ports that
formed part of this trading world, Butuan (situated on the northwestern coast of Mindanao) was one of the
most active and probably the center of trade and commerce in the island during 11th century. The Butuan
Traders brought beeswax, tropical hardwoods, gold, cowry shells and abaca. They acted mostly as source of
raw materials and transshipment centers.
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1890 DEPARTMENT STORES /
SUPERMARKETS
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DAWN OF THE DEPARTMENT
STORES
 1707, World’s Oldest Department Store. Fortnum and
Mason, London
 1877, First Department Store in the Philippines,
Hoskyn’s Department Store in Ilo-Ilo
 1952 Rustan’s

 1958 Shoe Mart

 1970 Metro Stores

 1979 Isetann
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1920 THE ROOT OF PLASTIC: USE OF
CHARGE CARDS

 1982 First issued credit card in the Philippines by

PCI Equitable Bank (RCBC)
 Massive use of credit cards/debit cards
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1924 HOLIDAY FUN

 Root of sales and discounts

 Macy’s Thanks Giving Day Parade also known as

Black Friday
 Coca Cola invented the use of coupons
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1930 SHOPPING MALLS

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 1877 Galleria Vittorio in Milan, Italy. Oldest

shopping mall1976 Ali Mall Cubao, First
shopping mall in the Philippines
 Muhammad Ali addressed a speech to build a
shopping mall near Araneta Center in honor to his
victory.
 Araneta Center is the developer of Ali Mall

 1985 SM Supermall
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1946 CONVINIENT STORES

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 1927 7ELEVEN (1984 in PH) a Japanese-owned
American convenience store
• 7elleven was owned by Joe Thompson and was established
in Dallas, Texas selling egg, milk and breads. At 1928 the
store operates under the name Tote’m Store.
• at 1930 due to economic depression and the company was
affected, send it toward bankruptcy and started selling its
shares for 7 cents in dollar.
• due to management buyout and stock market crash in 1987,
hundreds of its stores were sold to relieved debt incurred
during the buyout
• In 1990, the company filed for bankruptcy to transfer the 70%
control to a Japanese Ito-Yokado and changing its name to
7eleven to reflect its operating hours of 7am to 11pm
 1989 ALFAMART owned by an Indonesian named Djoko
Susanto. 2014 in the Philippines in partnership with SM.
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1960 - PRESENT
EMERGING NEW TECHNOLOGY
 Electronic Cash Registers
 Vendo Machines
 Use of bar codes
 TV shopping
 Social Media
 Online Shopping
• OLX established in 2006 and officially closed in September 11,
2018 due to lack of dealing
• Shopee founded by Forest Li in 2009 and was launched in the
Philippines in 2015
• Lazada established in 2012 owned by Alibaba Group / Alexander
Samwer and was launched in the Philippines in 2014
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PILLARS OF
PHILIPPINE
RETAILING
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HENRY SY

 2005 Father Of
Philippine Retailing

 SM Prime Holdings

 2,303 stores

 1,749 Specialty Stores

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FERNANDO ZOBEL
DE AYALA

 2006 Pillar of Philippine

Retail Development

 Ayala Corporation

 Real Estate, BPI, Globe

Telecome

 Manufacturing and
Automotive

 Social Infractructures
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 Ayala Corporation began in 1834 with the formation of distillery, the maker of
Ginebra San Miguel and was later acquired by La Tondeña in 1929.

 Ayala Corp also participated in the construction of Ayala Bridge over the Pasig
River.

 Manufacturing and Automotive

▪ Volkswagen Philippines
▪ Isuzu dealership
▪ Honda Cars Production Plant – with 12.9% stake in the $1.1 Billion
investment for the local operation and production plant

 Engage in Real Estate, Telecommunication, Banking, Utilities

• Ayala Land, BPI, Globe Telecom, Manila Waters

 Social Infrastructure
• Generika Drugstore

 Digital Business
• Zalora Ph
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JORGE L. ARANETA

 2007 Father of Philippine

Retail Entertainment

 Araneta Group

 Developed Araneta Center

 Araneta Coliseum is one of the

largest dome in the world

 Notable events take place at the

arenas was 11th and 34th FAMAS,
Binibining Pilipinas Pageant,
Philippine Basketball Association
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SOCORRO RAMOS

 2008 Matriarch of
Philippine Retail

 National Bookstore
  The first National Bookstore began in 1940 as a small store in
z
Escolta selling GI novels and textbooks

 When the war broke out, strict censorship forced retailers to shift
trades.

 Socorro and her husband then moved to selling soaps and candies.

 After the Japanese occupation, the couple were able to rebuild a

small barong-barong in the corner of Soler and Avenida and started
selling textbooks, newspapers, notebooks and pencils.

 In 1995 National Bookstore introduces its house brand of school

supplies – Best Buy

 National Bookstore made its transition from a stall of a humble

beginning to the Philippine’s biggest bookstore chain
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JOHN GOKONGWEI JR.

 2009 Champion of Retail

Entrepreneurship

 JG Summit Holdings

 Airline and Food

Manufacturing

 Malls, Utilities, Hotels

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 In 1957 Mr. Gokongwei constructed a corn milling
plant to produce glucose and constarch and it is
called Universal Corn Products which expanded and
became Universal Robina

 In 1961 the company launched Blend 45 to compete

with Nestlé’s Nescafe

 Aside from his very own airline Cebu Pacific, in 2013

his company acquired a stake in the country’s largest
power distributor MERALCO for $1.8 Billion
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BIENVENIDO TANTOCO

 2010 Father of Luxury

Retailing

 Rustan’s

 Signature Brands
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 He is considered as the Philippine Most Prestigious Retailer and

the first in the country’s retail industry to introduce Loyatly
Program “ Frequent Shoppers Plus”

 Some of the signature brands carried by the company are Gucci,

Jimmy Choo, Armani, Samsonite, Michael Korrs, Kenneth Cole,
Lacoste, Aerosoles, Aeropostale, Estee Lauder, Burberry, Calvin
Klein, Banana Republic, NineWest, Mac, Payless

 iI 2012, Dairy Farm Group bought 50% of the company’s stake

 2017 , Dairy Farm Group acquired the full ownership of Rustan’s

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MARIANO QUE

 2011 Father of Health

and Wellness Retailing

 Mercury Drugstore
z  Mercury Drug began from a bottle of sulfathiazole, which was
considered a wonder drug after the war.

 Medicines that time were scarce and expensive.

 Mariano saw the need for medicine and saw a peddler selling
the so called wonder drug which they believe can cure all
diseases. Seeing the W on the tablets he knew it was the
genuine sulfathiazole.

 He tried to buy a bottle of that drug for P100, the only money in
his pocket. Luckily, the peddler agreed to sell a bottle of drug for
P100.

 Mariano sold the tablets by “tingi-tingi” or per piece to make the

medicines affordable. With some profits, he was able to buy
more medicinces and eventually put up his own drugstore.

 March 1, 1945 the first Mercury Drugstore opened in Manila.

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Introduction to
Retail Management
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What is Retail?

“Any business that directs its marketing efforts towards

satisfying the final consumer based upon the
organization of selling goods and services as means of
distribution.”

-David Gilbert
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“Includes all activities involved in selling goods or

services to the final consumer for personal and non-
business use.”

-Philip Kotler
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“Retailing is defined as the buying and selling of goods

and services or as the timely delivery of goods and
services demanded by consumers at prices that are
competitive and affordable.”
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FUNCTIONS OF RETAILING

 Breaking bulk

 Sorting and categorizing of goods.

 Offer advise and guidance to help customers to make the

right choice.

 Holding stocks

 Credit services

 Training and after sales to end-users.

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IMPORTANCE OF RETAILING

 Retailing creates time, place and possession utility.

 Makes a wide variety of goods available to consumers.

 Plays a valuable role in creating a product and brand

image.

 Retailers are vital communication link between the

manufacturer and end-user.

 Personalized service and customizing as and when

required.
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CLASSIFICATION OF RETAILING FORMAT

 Store Based Retailing

 Non-store Based Retailing

 Service Based Retailing

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STORE BASED
RETAILING
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 A tangible based retailing channel.

 Customers buy products by seeing their practical

exposure in stores.
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I. On the basis of Ownership

II. On the basis of Merchandise

Offered
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On the basis of Ownership

1. Independent Retailer

2. A Chain Retailer
3. Franchise
4. Leased Department
5. Consumer Co-operatives
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1. Independent Retailer

 Is the one who owns and operates

only one retail outlet.

 Maintains a good relationship with the

customers.
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2. A Chain Retailer

 When two or more retail outlets are

under a common ownership.
 Groups of retail stores engaged in the
same general field of business that
operate under the same ownership or
management.
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3. Franchise

 A contractual agreement between franchisor and a

franchisee in which the franchisor allows the
franchisee to conduct a business under an
established name as per the business format.

 In return the franchisee has to pay a fee to the

franchisor.
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4. Leased Department

 When a section of a department in a

retail store is located/rented to an outside
party.

 They are termed as shop in shops.

 It is a good method available.

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5. Consumer Co-operatives

 Retail organizations owned by its

member customers.

 The objective is to provide

commodities at a reasonable price.
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On the basis of Merchandise Offered

1. Super Market
2. Hyper Market
3. Convenience Store
4. Departmental Store
5. Specialty Store
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1. Super Market

 These are retail organizations that provide low cost

high volume self-service operation to meet consumer
requirements.

 Most of the super market charge lower price.

 They are large self-service outlets, catering to varied

shopper needs.
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2. Hyper Market

 Super store which combines a supermarket and a

department store.

 Huge retail stores that offer various products such as

clothes, jeweler, stationery, electronic goods at
cheaper price.

 They focus on high volume.

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3. Convenience Store

 These are relatively small stores located near the

residential are.

 They offer limited line of convenient products.

 Such stores enable the customers to make quick

purchase and offer them few services.
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4. Departmental Store

 Large scale retail institution that offers several

products from a pin to plane such as clothing.

 Sells a wide variety of goods.

 Largest form of organized retailing today, located

mainly in metro cities, in proximity to urban outskirts.
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5. Specialty Store

 Offers specific and specialized types of items.

 They offer a narrow product line that concentrates on

specialized products such as jeweler, fabrics,
furniture.

 Specializes in one area.

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NON-STORE
BASED
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 A direct relationship of the retailer

with his customer is on the basis of
non-store Retailing.
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1. Direct Selling

 Direct selling is a retail channel for the distribution of

goods and services.

 There is no fixed retail location.

 In direct selling there is a direct contact of the retailer

with his ultimate customers.
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2. Mail order

 It is a retail format in which offerings are

communicated to the customers through a catalogue
or letters.

 Such retailing is suitable for specialty products.

 The buyer places an order for the desired products

with the merchant through a telephone call or
website.
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3. Telemarketing

 It is a form of retailing in which the products are

advertised on television.

 Details about the product in regard to its features,

price, warranty, direction to use etc. are mentioned
and explained.

 Phone numbers are provided due to which customers

can make a call and place an order for the product.
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4. Automatic Vending

 This is a form of non store retailing in which the

products are stored in a machine and dispensed to
the customers when they deposit cash.

 Vending machines are placed at convenient and busy

locations like air ports, shopping malls, working place
etc.

 This machine primarily contains products like

chocolates, snacks and drinks etc.
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5. Electronic retailing

 It is also called as e-tailing or internet retailing.

 It is a retail format in which products are offered to the

customers through internet. The customers can
evaluate and purchase the products from their homes
or office place.

 This kind of retail is gaining importance in recent

years.