In the 18th and 19th centuries, many rural towns in the United States had a single storefront where residents bought everything they needed—from shaving cream to sewing notions. These general stores operated on a simple principle: offering customers a one-stop shop with a wide range of goods.
From these humble beginnings, the general merchandise market has ballooned to become a huge portion of US retail. In 2022, general merchandise stores in the United States sold more than $850 billion worth of products. Here are the basics for selling general merchandise and what you need to start.
What is general merchandise?
General merchandise is any product commonly found in retail stores and intended for everyday use, excluding food and grocery products. These items include everything from household goods and electronics to apparel, toys, tools, sporting goods, and home décor.
However, simply selling TVs or socks doesn’t make you a general merchandise retailer—to earn this label, you need to offer a wide array of general merchandise products to cater to the diverse interests or needs of your customers. The goal is to provide a one-stop shopping experience for consumers looking for a range of goods in a single location.
General merchandise stores may include department stores, supermarkets, discount stores, and other retail outlets; for example, in the US, Target, Walmart, Costco, and Dollar General are considered general merchandise stores. (Note that many general merchandise retailers also sell groceries and food products, though these products aren’t officially considered general merchandise.)
Benefits of selling general merchandise
General merchandise stores can offer savvy business owners unique opportunities in the retail industry. Here are the benefits of selling general stock:
- Attracts a wide customer base. While specialized retailers like toy shops or beauty stores appeal to narrower customer bases, a general merchandiser can attract a wider array of customers looking for many different items. Customers shopping at general stores may also make additional purchases while browsing in sections they weren’t initially planning to shop at, thus increasing the store’s revenue.
- Builds brand loyalty. General merchandising can appeal to customers looking for a one-stop shop—they’re likely to check your shelves first to avoid the hassle of shopping at multiple locations (online or in person). This can build brand loyalty.
- Provides opportunities for cross-selling. Offering a range of general merchandise increases the chances of cross-selling. Customers who initially come for one product may discover complementary items while they shop, leading to larger transactions, increased revenue per customer, and greater customer satisfaction.
- Can stay flexible with market trends. Stores that sell general merchandise enjoy a great deal of flexibility when choosing what to stock in their store. This means they can devote large sections of their store to splashy seasonal items or eye-catching trendy products, while retailers with a narrow selection of specialized stock may struggle to offer relevant seasonal items or follow consumer trends.
Challenges of selling general merchandise
Breaking into the general merchandise industry can be difficult—especially for a small business. Here’s why:
- Differentiating your brand. When you sell everything from art supplies to cough medicine, you may find it difficult to tell potential customers what’s unique about your store. General merchandisers must brand themselves with a clear identifier or unique value proposition to coax new customers in.
- Tough competition. Small businesses can have difficulty competing with established general merchandisers, since big national brands are familiar to so many shoppers, have relationships with hundreds of suppliers, and can buy larger wholesale volumes at better prices.
- Diverse demands on employees. Unlike a specialized store, where employees can apply based on their interests and expertise, a general merchandiser asks unspecialized employees to be experts on everything. Responsibilities and duties might include consulting on lamps, socks, and holiday decorations, all on the same day.
How to start selling general merchandise
- Establish your target market
- Pick a convenient location
- Choose the right products
- Line up your inventory
- Organize your products
If you’re ready to dive into the world of general merchandise, you’ll follow most of the same steps as starting any kind of retailbusiness—things like marketing development and inventory organization. However, here are a few especially important steps in the general merchandise arena:
1. Establish your target market
Defining your target market is the foundation of any good sales strategy—but it’s especially important in general merchandising. Without a specialized inventory, you need a unique identifier or value proposition to set you apart from the rest and attract customers.
Play around with setting yourself apart using special pricing, store layout, or delivery methods. Consider, for example, dollar stores, which appeal to budget-conscious shoppers, or convenience stores, which offer a quick in-and-out approach.
2. Pick a convenient location
A hallmark of a general merchandise store is its convenient location. If you’re a brick-and-mortar retailer, this means picking a location near communities in your target market.
If you want to set up a physical store in a suburban area, you might look for easy street access and ample parking. If you’re an online retailer, you may choose a catchy, easy-to-spell name to simplify the search process for online shoppers.
3. Choose the right products
Armed with a detailed definition of your target market, choose a selection of products your customers want. Keep in mind the cost and availability of storage options and the size of your sales floor (or, if you’re an ecommerce shop, the product capacity of your website and your ability to deliver). If you’re stumped, look up trending products for inspiration.
4. Line up your suppliers
For a steady, reliable flow of incoming products, identify, connect with, and maintain a relationship with a host of wholesalers or manufacturers.
There are several variables to consider when determining which suppliers are right for you—including lead times, minimum order quantities, locations, future schedules, and potential to grow. For more, check out our how-to guide on sourcing suppliers.
5. Organize your products
Once you have products, make them shine. If you’re opening a brick-and-mortar store, plan the details of your store layout with your customers in mind. For instance, consider placing higher-ticket items on the far right wall (sometimes called the “power wall,” since it’s the wall customers tend to turn toward first) to boost sales, or keeping the most popular items in the back to encourage storewide traffic.
If you run an online general merchandise store, design your website to be user-friendly and check out successful websites to see what works for them. Don’t forget to optimize your product pages to entice shoppers to buy.
General merchandise FAQ
What is considered general merchandise in a store?
General merchandise is any good that isn’t a food or grocery product, whether that be a winter coat, a TV, or a kitchen table.
Is selling general merchandise a profitable strategy?
Selling general merchandise can be a profitable strategy for a business because it can attract a wider customer base and increase brand loyalty, and it avoids selling products that perish.
What are the challenges of selling general merchandise?
Selling general merchandise can be difficult since you may be competing with established national brands, struggling to differentiate yourself, and asking employees in unspecialized roles to be experts on everything in the store.
