Retail sector of the United States of America is considered as one of the foundational sectors of the economy. Retail sectors have direct approach to the consumer, which exhibit their importance in overall economy. Importance of retail sector can be determined by the fact that two third of the GDP of United States of America is generated by retail sector.
Size of Retail Market:
By taking into account revenue, USA is undeniably the leather in retail industry. Unlike the retail stores of the past, now retail stores are transformed into giant multinational chains with broad range of products for every sort of consumer. For instance, Walmart is not only the biggest retail store in the world, it is considered as the biggest company in the world. This example can easily exhibit the strength of retail sector in United States of America. According to the survey of global power retailing, it can be established that 76 of the largest retail companies are based in United States of America. Of the top 10 largest stores in 5 are originated from United States of America.
Type of Retail Stores:
Basically there are two type of retail stores usually consumers confine.
Brick and Mortar Store Retailers:
These are the stores with actual physical existence. They have physical display and merchandise for their broad range of products. These stores are valued for their shopping experience. Wide range of product and ease of physically inspecting the product before making the purchases makes them as one of the most accepted way of retailing.
Non Store Retailer:
These are the virtual reality online stores which uses e- commerce and online store concept to sell their product. These type of stores are gaining popularity because ease and time saving concept it provides to the customer. Products are selected online and delivered at door step. It sometimes is prone to the risk of faulty product but good companies often have few days money back guarantee.
Direct Link with Economy:
Businesses of retail sector has direct link with the end consumer. They are most affected by recessions and growths of the economy. A strengthening retail sector is a since of improved consumer confidence and spending whereas weakening retail sector is a result of weaker consumer confidence and spending. This relation of mediator between the economy and consumer makes it as one of the most important component of US Economy.
After the recession of 2008, consumer preferences and spending were largely effective. FED ease the monetary policy to improve the economic outlook of the country. Recently after more than 8 years of eased monetary policy, we can conclude that economy is finally expanding. Yet consumers are still reluctant to spend in to the retail market.
Other economic aspects such as job creators and GDP growth exhibit that there is a positive outlook for retail sector as well. Eventually consumers will gain back confidence and will start spending into the retail sector again.
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