Store-within-a-store
Encyclopedia
A store within a store is an agreement in which the owner of a shop lets a part of the shop site to be used by different company to run another shop. This agreement is popular among filling station
s and supermarket
s. Many bookstores partner with coffee shops, as customers often desire a place to sit and enjoy a drink while they read. Companies employing this technique include BP
/Amoco
Sheetz
, Exxon Mobil and Hollywood Video
with its Game Crazy video game boutiques.
Often the store-within-a-store is a owned by a manufacturer, operating an outlet within a retail companys's store. So, for example. Bloomingdale's has had such arrangements with Ralph Lauren, Calvin Klein, DNKY and Kenneth Cole. Nieman Marcus has had them with Amani and Gucci. Zhang and Jerath have found that the arrangement works, because the retailer offers prime locations for which they can charge high rents, the manufacturer makes a higher profit than it would through a wholesale model,and the consumer gets a lower price and better service. The operator of the store within a store can provide these benefits because it receives all profits, instead of having to share then with the retailer, as it would in the traditional split between manufacturer and retailer activities.
They have found that the arrangement works best for relatively unsubstitutable goods, like cosmetics and brand fashions.
Knowledge@Wharton, "The Economic Incentives of the Store-in-a-Store Model" September 2, 2009 http://knowledge.wharton.upenn.edu/article.cfm?articleid=2333
Filling station
A filling station, also known as a fueling station, garage, gasbar , gas station , petrol bunk , petrol pump , petrol garage, petrol kiosk , petrol station "'servo"' in Australia or service station, is a facility which sells fuel and lubricants...
s and supermarket
Supermarket
A supermarket, a form of grocery store, is a self-service store offering a wide variety of food and household merchandise, organized into departments...
s. Many bookstores partner with coffee shops, as customers often desire a place to sit and enjoy a drink while they read. Companies employing this technique include BP
BP
BP p.l.c. is a global oil and gas company headquartered in London, United Kingdom. It is the third-largest energy company and fourth-largest company in the world measured by revenues and one of the six oil and gas "supermajors"...
/Amoco
Amoco
Amoco Corporation, originally Standard Oil Company , was a global chemical and oil company, founded in 1889 around a refinery located in Whiting, Indiana, United States....
Sheetz
Sheetz
Sheetz, Inc. is a chain of gas stations/convenience stores owned by the Sheetz family. Stores are located in Maryland, North Carolina, Ohio, Pennsylvania, Virginia, and West Virginia....
, Exxon Mobil and Hollywood Video
Hollywood Video
Hollywood Entertainment Corporation , known as Hollywood Video, was a VHS, DVD, and video game rental shop company started in 1988...
with its Game Crazy video game boutiques.
Often the store-within-a-store is a owned by a manufacturer, operating an outlet within a retail companys's store. So, for example. Bloomingdale's has had such arrangements with Ralph Lauren, Calvin Klein, DNKY and Kenneth Cole. Nieman Marcus has had them with Amani and Gucci. Zhang and Jerath have found that the arrangement works, because the retailer offers prime locations for which they can charge high rents, the manufacturer makes a higher profit than it would through a wholesale model,and the consumer gets a lower price and better service. The operator of the store within a store can provide these benefits because it receives all profits, instead of having to share then with the retailer, as it would in the traditional split between manufacturer and retailer activities.
They have found that the arrangement works best for relatively unsubstitutable goods, like cosmetics and brand fashions.
See also
- GastaurantGastaurantGastaurant, a portmanteau of gas station and restaurant, refers to a class of fueling stations which also incorporate a franchise-based restaurant in the same facility. Gastaurants are frequently found off of major highways in the United States. Gastaurants grew in popularity in the 1990s and...
Knowledge@Wharton, "The Economic Incentives of the Store-in-a-Store Model" September 2, 2009 http://knowledge.wharton.upenn.edu/article.cfm?articleid=2333