B00807007 Retail Theory Evaluation Assignment 1: Cyclical, Non‑Cyclical Models & Modern Retail Strategies

Overview of theories

An outline of retail

Retail has impacted the retail market greatly, especially over the past years and has been around for years. Retailing has been defined as ‘the set of business activities that adds value to the products and services sold to consumers for their personal or family use (Levy and Weitz 2004) Without retail, there would be no sales of goods, things would be free and theories of retail wouldn’t exist. Retail has changed throughout the years.

Tether (2005) indicates that our understanding of innovation largely stems from analyzing manufacturing sectors, where attention typically centers on significant technological advancements. Although that approach may be effective for factories and product creation, it doesn’t truly reflect the dynamics of innovation in retail. Retailers frequently implement smaller, continuous adjustments—such as enhancing customer service or utilizing technology to simplify the shopping experience. In the current rapid retail environment, influenced by digital technologies, increasing customer demands, and the transition to online and physical shopping experiences, innovation focuses more on continuous adaptation than on creating something completely original. Therefore, if we depend solely on manufacturing-focused concepts of innovation, we may overlook the daily adjustments that truly enhance retailers’ competitiveness today.

Within the retail sector, over recent years there have been many significant changes, influenced by many things, such as technology (digital transformation) and innovating to the consumers expectations.

“There are many different strategies to reel in a consumer into one’s business within the retail world, however when competition may evolve (or introduce something new to the market) this may leave other businesses feeling uneasy, not knowing what to do.”

Retail is defined as the activity of selling goods to the public, usually in shops (Cambridge Dictionary,1995). According to Musso and Druica

The above quote explains that retail is always innovating for consumers in modern times, however, when having a deeper look into the retail system there’re are different types of theories involved. This essay will explore into these theories and evaluate their significance in the current competitive retail world.

Wheel of theory

The Wheel of Retailing, introduced by (McNair in 1931), describes how retailers initially begin with low prices and basic services before progressively transitioning to more sophisticated, higher-priced businesses over time. Although this concept seemed very logical when it was initially presented, it doesn’t entirely hold true in the rapidly evolving digital retail landscape of today. Consider Amazon; instead of adhering to this conventional route, it launched in the market providing low prices and exceptional convenience from the very beginning. This method contests the notion that retailers are required to progress through a defined, linear sequence, demonstrating how the retail environment has changed in ways the original theory failed to predict.

Real life cycle

Retail firms go through predictable stages of growth and decline, but it may fail to account for the speed of disruption and technological innovation that modern retail faces today.

Synthesis of the Wheel of Retailing and Retail Life Cycle Theory

To contradict the theories

Contradict definition- deny the truth of (a statement) by asserting the opposite. -assert the opposite of a statement made by (someone).

Core theories of retail change (cyclical and non-cyclical)

Within the theories of retail, there are two categories of types of theories. The two types are cyclical and non-cyclical. To begin with the definition of cyclical theories will be presented, then explained

The above reference indicates that the retail enviroment/competitive use a predictible repeating pattern at each stage, however to contradict this view, retail factors are nowadays shaped by unpredictable factors such as technology and consumer bahaviours. Technology factors and consumer behaviours do not comprehend to fixed cycles.

Cyclic theories suggest that the retail environment and competitive practices follow a predictable, repeating pattern with identifiable stages. However, this view can be contradicted by the fact that retail dynamics are often shaped by unpredictable factors such as technological advances, economic shifts, and changing consumer behaviors, which do not adhere to fixed cycles. Rather than following a linear progression, retailers often experience non-linear development influenced by innovation and external disruptions. In today’s fast-paced market, success depends more on adaptability and responsiveness to new trends, making the concept of a rigid cycle less applicable. Additionally, the diversity of retail sectors means that different segments may evolve through unique patterns, further challenging the idea of a uniform cycle.

To explain the above definition, the cyclic theories comply the retail world competes, whilst following a repetitive pattern. The retailers go through highs and lows of cycle stages. There are cyclical theories that repeat within themselves. The above statement is very true, as a startup entrepreneur there are many highs and lows within the business, take Lidl for example. The start of the business, even in comparison to recent changes within the company, there are highs and lows in profit margins, customer satisfaction and competition.

Cyclic theories suggest that the retail world, and how stores compete with each other, tends to follow a repeating pattern over time. This means that retailers go through similar stages or phases in a cycle, like ups and downs, and these stages can be recognized and predicted. Basically, the idea is that retailers go through cycles that repeat, with each cycle having certain steps or stages that happen in order.

Moving on from cyclical theories there are non-cyclical thories, “Cyclical companies tend to see profits rise along with the rest of the economy, and all during periods of recession.”

technological advancements

Throughout history and in modern days there are many advancements within the theory of retail, to derive them within the cyclical theory

Wheel of retailing theory

Within the theories of retail, the wheel of retailing theory is the most popular.

1.2 Introducing the evaluation of theories

This essay will examine and critically evaluate key theories, including the wheel of retailing, the Assortment theory and the Retail Life Cycle Theory. By assessing their relevance and limitations, the discussion will highlight how these theories apply to modern times within the competitive retail environment. The goal is to emphasize the importance of combining historical insights with current trends to effectively navigate the challenges and opportunities facing the retail sector today.

There are three retailing theories, they illustrate the progression of different retail formats as they emerge, emerge and develop; there are cyclical, conflict and environmental theories. The theories being evaluated are as follows:

• Enviromental theory
• Retail Life Cycle
• Market Structure Theory
• Innovation Diffusion Theory

Overview of theories of retail change

Critically Evaluate Theories of Retail Change

• Identify Theories: Start by identifying key theories related to retail change, such as the Retail Life Cycle Theory, Market Structure Theory, and Innovation Diffusion Theory.
• Analysis: For each theory, examine its main ideas, strengths, and weaknesses. Consider questions like:
  • How well does this theory explain changes in retail?
  • Are there limitations or aspects it doesn’t cover?
  • How has the theory held up over time?

2. Assess Their Relevance in Today’s Retail Competitive Environment

• Current Context: Analyse how relevant these theories are in light of recent trends in retail, such as:
  • The rise of e-commerce and online shopping.
  • The impact of technology and data analytics.
  • Shifts in consumer behaviour and preferences (like sustainability and experiential shopping).
• Practical Examples: Use real-world examples to illustrate how these theories apply (or don’t apply) to today’s retail landscape.

Overall Goal

The goal is to provide a thoughtful critique that shows your understanding of both the theories and the current retail environment. You’ll want to connect the dots between past theories and modern challenges and opportunities in retail.

If you have specific theories or concepts in mind or if you need more details on a particular aspect, feel free to ask

Cyclic theories hypothesize the retail environment and competitive practices of retailers will follow a slightly, repeating pattern, with clear identifiable stages. The cyclical models assume that retailers pass through before-known stages and follow a certain cycle.

This cycle is at (book-the changing role of retailing theory)

-3)Wheel of retailing therapy(mcnair,1931)- The retailer opens up their business, starting off with lower prices. The business also starts off with lower business costs within the business(not related to the consumer).

explain that there are two types of theories when it comes to the change within retail. One of which is called Cyclical theory, the other theory is called Non cyclical.

Reference list

Brynjolfsson, E. and Smith, M.D., 2000. Frictionless Commerce? A Comparison of Internet and Conventional Retailers. Management Science, 46(4), pp.563-585.

Fernie, J., Fernie, S. & Moore, C.M. (2015) Principles of retailing. Publishe: Routledge; 2nd edition

Levy, M. & Weitz, B.A. (year) Retailing management. Publisher.

Jones, M. (2021). Innovation in Retail: The Role of Technology in the Modern Marketplace. 2nd ed. London: Routledge.

Bell, D. and Lattin, J. (1978). The Retail Life Cycle. Journal of Retailing, 54(3), pp. 44-58.

Ojo, Dr & Isiramen, Monday & Elaho, Omoruyi. (2021). THE CHANGING ROLE OF RETAILING THEORY IN AN EXMERGING ECONOMY. 5. 66-73.

Example for above (journal reference) Lawson, C.L. and Katz, J. (2004) Restorative justice: an alternative approach to juvenile crime. Journal of Socio-Economics, 33 (2), 175-188.

https://www.researchgate.net/publication/358581810_THE_CHANGING_ROLE_OF_RETAILING_THEORY_IN_AN_EXMERGING_ECONOMY

Brynjolfsson, E., & Smith, M. D. (2000). Frictionless Commerce? A Comparison of Internet and Conventional Retailers. Management Science, 46(4), 563-585.Hodgson, P. (2020). The Evolution of Retail: Beyond Traditional Models. Journal of Retail and Consumer Services, 53, 101974.

Levy, M., & Weitz, B. A. (2007). Retailing Management (7th ed.). McGraw-Hill.

McNair, M. P. (1958). The Wheel of Retailing. Harvard Business Review, 36(6), 106-110.

World Health Organization (2025). Coronavirus disease (COVID-19) pandemic. [online] World Health Organization. Available at: https://www.who.int/europe/emergencies/situations/covid-19.

MILES, I. (2000). SERVICES INNOVATION: COMING OF AGE IN THE KNOWLEDGE-BASED ECONOMY. International Journal of Innovation Management, 04(04), pp.371–389. doi:https://doi.org/10.1142/s1363919600000202.

Tether, B.S. (2005). Do Services Innovate (Differently)? Insights from the European Innobarometer Survey. Industry & Innovation, 12(2), pp.153–184. doi:https://doi.org/10.1080/13662710500087891.

Brown, S. (1991). The Wheel of Retailing: Still Rollin’ After All These Years. The Wheel of Retailing: Still Rollin’After All These Years, 5, pp.179–198.