Methods Of Operation Of Multiple Shops/Chain Stores

Multiple shops or chain stores are operated under central ownership and management. Multiple shops have no separate owners of each store. Single owner or business firm owns, manages and operates all such multiple shops. Mostly, producers establish, manage and control all the multiple shops located in different places.

Multiple shops are operated in form of joint stock company. A board of directors is formed for its management and operation. Necessary employees including chief manager are appointed to central office, and other sales managers and salespersons work in all such shops.

The sales manager and other salesmen in multiple shops cannot do their work independently. They are not given authority regarding price of goods, advertising policy, display, decoration, layout of the shops etc.They must work according to central policy and direction. The employees working in multiple shops in different places prepare periodical accounts of their respective shops or stores and send to central office. Central office makes arrangement for time-to-time inspection of these shops. The central office makes uniform policy, implements and controls them properly. It pays special attention to the budget that it should not exceed the fixed budget , should not maintain more or less stock of goods than necessary.

                      Also Read: Disadvantages Of Multiple Shops

Mostly multiple shops are established and operated by manufacturers to sell their products. Sometimes, they also sell some products of other companies to attract customers. Multiple shops are supposed to be very important in developed countries for the elimination of middlemen retailing. Chain stores sell nearly one third of total sales in America.


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