Many people visit affiliated retailers without even knowing the difference between this and any other sort of business. The truth is that the majority of major chains and large businesses are primarily operated through affiliated retailers because it allows all participants to prosper. This also applies to banks and other financial institutions that offer services like credit card processing, merchant account services and much more.
Affiliated Retailer Definition
There are two definitions for affiliated retailer. They might seem to contradict at first. The first is any collection of stores that is controlled by a single person or business. The entity has either a majority a significant minority stock in the store, which gives this entity control of the retailer. They will do business under the entity’s name and typically offer the same services, prices and branding.
The second definition, also known as an affiliated chain, is a group of independent, noncompeting stores that band together to form a common identity. They might share the same or similar names, and they typically have similar logos. This allows them to become a larger chain, which affords them cheaper purchasing deals, better and more cohesive marketing and improves the overall coverage of the chain.
The binding force of both definitions is that affiliated retailers are grouped together and they don’t compete against each other. They might even refer to each other in special circumstances.
This isn’t like a chain store where the services are practically identical with each store. At the same time, the owners will often try to collaborate and make their stores very similar, with each one having minor differences. For example, they might all have similar credit card processing services, but one might have better rates or a few more options. Another example is that one might exclusively offer a merchant account for larger businesses while the others just have accounts for new business owners.
Typically the changes are so small that the common consumer won’t notice the difference between each retail installation. They’ll likely just think that each store is built to accommodate that area’s demographic.
An affiliated retailer is either under control of a single entity, or it’s a collection of noncompeting stores that come together to afford better purchasing and marketing. In either case, this typically grants better coverage and prices for the business owners, which makes everyone win in the end.