Trading company

A trading company or trading company is in a legal sense a company that is wholly or mainly to their own account and in his own name merchandise purchases from various suppliers and this, combined to form a range, without substantial working or processing to commercial and / or non-commercial purchasers resold. The hot goods in the industrial sphere products in the agricultural sphere products; once they pass into the possession of the trade, they are called articles. A commercial operation is the economic unit with a trading company is active in the market. A business group can also consist of several related trading companies as a trading company of several related trading companies. For example, has a more operational or chain store companies across multiple outlets. Colloquially, trading companies and trading company are often used interchangeably.

Fundamentally are trading company according to the forms wholesale ( wholesale ) and retail (retail) distinguished. The criterion of demarcation is not the amount of traded goods, but the only or mainly supplying customers. Wholesale companies have a commercial customer demand (eg retail, craft, catering, industrial companies ) and so-called large-scale consumers (eg canteens, cafeterias ). The customers of retail companies, however, are households ( consumers). The customer being exclusively or mainly abroad, include the appropriate trading company to external wholesale or retail on the outside. The numerous institutional manifestations of the wholesale and retail trade, particularly in the domestic trade, are treated as separate types of operation - distinction - true farm types. The development of ever new types of farms ( farm type modification, type of innovation) is the subject of strategic retail marketing.

Trading functions

These are services and tasks that perceives a trading company in the supply chain between the manufacturer and the industrial and non - industrial users of the products. Producers take their part in the procurement of raw materials, auxiliary materials and equipment performance of the (large) trade services. The Study of commerce has developed numerous trade functions. Typical are about:

• Space bridging function ( transport of goods from the production and suppliers sphere in the vicinity of the customer )
• Time bridging function (storage)
• Range function ( consumer-oriented bundling of products from different manufacturers )
• Quality function ( offer in customizable, differentiated qualities)
• Quantity function ( offer in customizable sets)
• Credit function (payment of supplier and customer loans)
• Service function ( provision of commercial and / or technical services, such as Exchange, service, spare parts procurement, assembly, repair)
• Information and advisory function ( information on product characteristics and uses )
• Market influence function (information delivery to market participants, especially potential customers )
• Cultural function (opening of access to goods from all cultures )

Law of the dynamics of the Operating forms

The Robert Nieschlag so called " dynamic of the types of operation " describes the development of new forms of operation or operating types of trade as a quasi- legitimate sequence of four phases, similar to the product life cycle in marketing. This concept is related to Malcolm P. McNair's " Wheel of Retailing ".

In the first phase ( development ) of the new operating model pursues an aggressive low-price strategy to enter the market. The second phase (ascent ) is characterized by above-average revenue and earnings growth and thus competitive advantage over competing forms of operation. The third phase ( maturity ) is characterized by stagnation of growth and decline in profits. The current price-oriented policies must be modified. The new form of operation is losing market share. There must be a trading up, are connected to the higher cost. Due to the increased cost of the new operating model prices to those of the conventional, also responsive operation types must converge. The fourth phase ( decline or degeneration and assimilation ) opens opportunities for new types of farms because of the general rise in price levels. The " Wheel of Retailing " begins anew.

Are only called when the following criticisms: From a law can be no question, since the duration of the four phases is not unique and unpredictable (lack of prognostic relevance ). Furthermore, does not begin any new and successful operation form of trade with a low price strategy, which many counter-examples to prove. So the designed Convenience Stores their market access with a high-price strategy. Discounters, however, realized a persistent low-price strategy. Other new forms of operation start with a new assortment idea with new services or with a new sales technique, and it may happen that the new operating shape quickly proves to be a flop and can not see any at all ( four-phase ) life cycle. Failed experiments with moving shops in Berlin in the 20s, with vending shops or catalog showrooms would be mentioned by way of example. Finally, the suggestion that the mature phase must necessarily be followed by a period of decline that commercial companies will operate at the latest at the stage of sales stagnation increasingly active trade marketing and avert a decline misunderstands.