The United States of America (USA) has been a forerunner in the evolution of retailing. Today, the Organised players handle 80% of the retail trade in the US. Wal-Mart alone handles 6% of the total retail trade and the top 50 retailers control 36% of the Organised retail. The factors that contributed towards the growth and consolidation of Organised retailing in the US are described below:
1) BABY BOOMERS: -
The single largest contributor to the growth of Organised retailing was the boom in consumer spending after the Second World War. This was caused largely due an increasing population, when America witnessed 64 million births in an 18-year period. Consumer preferences changed and spending patterns became significant drivers for detail expansion thus making retailing an attractive business.
2) INCREASED PER CAPITA SPENDING: -
The effect of population increase was further accentuated by an increase in per capita spending. Per capita personal consumption expenditure in the US, rose form $1,796 in 1959 to $22,391 in 1999. Even after adjusting for inflation, the per Capita Expenditure in 1999 was more than double of that in 1959.
3) DUAL INCOME FAMILIES: -
Advent of dual income families also helped in the growth of retail sector. A dual family can spend more but has very little time available for shopping. Thus, convenience and speed of service became crucial parameters.
4) URBANISATIONS: -
Increased urbanization has led to high customer density areas thus enabling retailers to use lesser number of stores to target the same number of customers. Aggregation of demand that occurs due to urbanization helps a retailer in reaping the economies of scale.
5) COVERING DISTANCE HAS BECOME EASIER: -
With increased automobile penetration and an overall improvement in the transportation infrastructure, covering distances has become easier than before. Now a customer can travel miles to reach a particular shop, if he/she sees value in shopping from there.