CHAIN STORES VS DEPARTMENTAL STORE — SIMILARITIES AND DIFFERENCES

Chain stores are a group of retail outlets owned by a firm but distributed in different parts of a country or region.

On the other hand, a supermarket is a retail outlet specializing in the sales of mainly household items on a self-service basis.

Both chain stores and supermarkets have similarities and differences, which will be explained in this post.

Similarities Between supermarket and chain stores

1. Both are large-scale retailers: Both supermarkets and chain stores are forms of large-scale retailing because they operate on a large-scale basis.

2. Both operate on a cash basis: Both supermarkets and chain stores operate do not offer credit facilities.

Both operate on a cash basis, which means one has to have cash in hand or bank to purchase in supermarkets or chain stores.

3. Both purchase goods in bulk: The central management buys products in chain stores and supermarkets.

This way, they can enjoy the benefit of specialization.

4. Bad debt is reduced in both: Since both supermarkets and chain store exclusively accept cash as payment, bad debt is reduced.

5. Both require large capital: Due to the high cost of stocking up on goods, both chain stores and supermarkets need a significant amount of capital to get started 

Difference between supermarket and chain stores 

1. A chain store does not operate on the premise of self-service, whereas a supermarket does.

2. A chain store may sell both household and non-household goods, whereas a supermarket primarily sells household goods.

3. Although some supermarkets have branches, it is not necessary for supermarkets to have branches.

Chain stores, on the other hand, have branches because they are the foundation of their business.

4. Chain stores sell the same product across all of their locations, whereas supermarkets sell a wide range of products.

5. Chain stores typically sell products from one manufacturer, while supermarkets typically sell products from multiple manufacturers.

Indeed, the whole idea of chain stores is to distribute the goods of a manufacturer.

To conclude, the main difference between chain stores and a supermarket is that that a supermarket is based on self service whereas a chain store does not operate on the principle of self service.

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