Major Retail Forms: Organized Versus Unorganized Retailing

In a sharp contrast to the organized retail, the unorganized retail is also in existence with the large size and it is highly fragmented and unorganized; with the huge number of retail densities worldwide. Still in many developing countries unorganized retailing has the major share of the retailing business. There are no any clear definitions of organized retailing and unorganized retailing.

It can be expressed “Unorganized retailing”, as an outlet run locally by the owner or caretaker of a shop that lacks technical and accounting standardization. The supply chain and sourcing are also done locally to meet local needs. Its organized counterpart may not obtain its supplies from local sources.The major difference between organized and unorganized retailing lie in its number (chain) of store operations. The unorganized outlet may be just stand alone or can have maximum of 2-3 outlets in different areas city where as the organized outlets are "any retail chain (more than two outlets) which is professionally managed (even if its family run), has a accounting transparency (with proper usage of MIS and accounting standards) and organized supply chain management with centralized quality control and sourcing (certain parts can be locally made) can be termed as an "organized retailing".Organized retailing is based on the principle of unity and unorganized retailing is based on the principle of singularity. Both organized and unorganized retailing is found in most countries throughout the world. India andChina are strong examples of countries in which unorganized retailing dominated their markets. Today these countries have a growing economy because of the influx of organized retailers into their markets. Migration from unorganized to organized retail has been visible with economic development in most countries.

Table: [A] Distinction between Organized Retailing and Unorganized Retailing

Parameters of Difference	Organized Retailing	Unorganized Retailing
Scale of Operations	Large	Small
Scope of Operations	Nationwide  or Worldwide	Local or Regional
Operation System	Highly Organized (Professionally managed)	Highly Unorganized (managed ordinarily)
Prevailing	Largely in Developed nations	Largely in developing and under developed nations
Business Management	Done by Owner	Professional Managers
No. of stores	Chain of Stores	Maximum 2-3 stand alone shops
Business Principle	Principle of Unity	Principle of Singularity
Employees	Skilled , Professionally trained, and qualified	Unskilled , Untrained , and less qualified
Sopping experience	Excellent or Good	Poor or Fair
Range of Products	Wide range of products	Relatively narrow range of products
Physical Ambience	Pleasurable	Lacking graciousness
Parking Facility	Adequately available and properly managed	Inadequate and unmanaged
Convenience of choosing products	Can walk around the product shelves and see it	Cannot walk around the product shelves and  cannot see it
Pricing	Never depend on relationship	Sometimes depend on the relationship
Bargaining	Not possible	Possible to some extent
Sourcing Merchandise	Mostly direct from the manufacturer	Mostly from  C & F agents,  Distributors, or Wholesalers
Varity & Styles of Merchandise	According to  national or global demands	According to local or regional demands
Examples	Wal-Mart, McDonald's, Sears	Counter stores, kiosks, street markets and vendors,