Retail Trade

The retail trade division includes establishments engaged in selling merchandise for personal or household consumption and rendering services incidental to the sale of the goods. In general, retail establishments are classified by business type according to the principal lines of commodities sold (e.g., groceries or hardware) or the usual trade designation (e.g., drug store or cigar store). Some of the important characteristics of retail trade establishments are: the establishment is usually a place of business and is engaged in activities to attract the general public to buy; the establishment buys, receives, and sells merchandise; the establishment may process its products, but such processing is incidental or subordinate to selling; the establishment is considered as retail in the trade; and the establishment sells to customers for personal or household use. Not all of these characteristics need be present, and some are modified by trade practice.

For the most part, establishments engaged in retail trade sell merchandise to the general public for personal or household consumption. Exceptions to this general rule are lumber yards; paint, glass, and wallpaper stores; typewriter stores; stationery stores; and gasoline service stations that sell to both the general public for personal or household consumption and to businesses. These types of stores are classified in retail trade even if a higher proportion of their sales are made to entities other than individuals for personal or household consumption.

Establishments primarily engaged in selling such merchandise as plumbing equipment, electrical supplies, used automobile parts, and office furniture are classified in wholesale trade, even if a higher proportion of their sales are made to individuals for personal or household consumption.

Buying of goods for resale to the consumer is a characteristic of retail trade establishments that particularly distinguishes them from the agricultural and extractive industries. For example, farmers who sell only their own produce at or from the point of production are not classified as retailers.

Processing incidental or subordinate to selling is often conducted at retail stores. For example, restaurants prepare meals, and meat markets cut meat. Separate establishments selling merchandise for personal or household consumption which has been manufactured by other establishments of the same company are classified in retail trade.

Chain store warehouses are considered auxiliary to the retail establishment served and are classified on the basis of the activity carried on by such retail stores.