The wheel of retail and the retail lifecycle are excellent examples of theories of retail instruction and structural change.  However they have been criticised for describing rather than explaining the concepts.  Discuss each theory in detail and state whether or not you agree with this assertion.  Illustrate your answer with relevant modern day example from your own personal experiences.

To begin with I am going to talk about the wheel of retail.  Before I go any further I would like to stress how important it is to know that the wheel of retail is not a theory, it is a concept.  “The wheel of retailing” is the name Professor Malcolm P. McNair suggested for a major hypothesis concerning patterns of retail development.  According to Cox and Brittain the wheel of retail postulates that an efficient innovatory form of retailing (such as discounting) enters the market and attracts the public by its new appeal.  The wheel of retailing has three stages, these include the introductory phase which come first, then the trading-up phase and finally the vulnerability phase.  Below I inserted a chart so you can see the processes easier.

Each phase has an important role to play in the wheel of retail.  I am now going to discuss each of these phases so that it paints a vivid picture in your head of what exactly the wheel of retailing is.  In 1987 Brown suggested that traditional retailers are undermined by the introduction of a new low-cost approach to retailing, which subsequently trades up and finally becomes vulnerable itself to another retailing innovation.  The first phase is the introductory phase or otherwise known as the entry phase.  This is the innovative retailer, which has a low status, low prices, a minimal service, poor facilities and limited offerings.  The innovative retailer then decides to add value and trade up, which then allows them to move into the trading up phase.  This is where there are more elaborate facilities, additional services, in a higher rent location, fashion orientation for their customers, higher prices, extended prices and extended product offer.  After the retailer has completed the innovative stage, has then traded up they then mature as a retailer and move into the vulnerability phase.  This is where the retailer reaches conservatism, top heaviness and declining the ROI.  This is a stage where retailers have to become very careful with how their approach with customers.  A good example of a retailer moving through all these stages is Next.  George Davies is the fashion visionary who founded 'Next' in the eighties.  To be exact it was 1982 when he launched the giant retail, Next.  His experiences there led him to launch the radical retail concept 'Next' in Leicestershire after menswear retailer Hepworths brought him in to overhaul its stores.  George's vision for 'Next' was simple, arrange the clothes according to colour to make it as easy as possible for customers when selecting an outfit.  This vision, coupled with making the shop environment as conducive to purchasing as possible, established 'Next' as one of the UK's leading retailers and then later trading up into interiors, cosmetics and mail order.  George was awarded the Guardian's Young Businessman of the Year in 1985 as a result of his achievement.  However things started to go wrong when he opened for too many stores because this is when they start to eat into each others markets.

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While the wheel of retail concept can be illustrated by the growth of a number of types of retail businesses, such as department stores, supermarket and factory outlets it is increasingly difficult to apply.  According to Rosemary Varley and Mohammed Rafiq in the book Principles of retail management this is  because of the assumption that innovative retailer operate on a low-price, low status minimalist basis.

Cox and Brittain believe that growth and maturation occurs during the market shares which are increased, which then results in trading-up occurring and finally the firms become high cost and high price retailers once ...

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