Trade audit is a set of measures aimed at examining the state of trade through a comprehensive analysis and monitoring of the work of outlets. A trade audit is carried out as part of marketing research and can consist of many overlapping, complementary and interconnected stages, starting from the study of the territory, retail “retail” audit, control of the display of goods, ending with monitoring of outdoor advertising and analysis of competitors’ prices. Audit of outlets is the most popular marketing tool from the listed arsenal, aimed at studying how effectively a particular outlet carries out sales. The most frequent initiators and consumers of these studies are manufacturers of goods and retail chains.
Retail audit in the framework of a trade audit usually refers to research aimed at a comprehensive analysis of the assortment, availability, and stock of goods, their value, general representation in retail outlets, the availability of advertising materials, the quality of staff work, as well as the pricing policy of competitors. The retail audit is often held under the name of “retail audit” (or retail audit methodology – retail audit). This type of research is in demand because many factors simultaneously influence the purchasing power at once, each of which must be carefully monitored and controlled. A retail audit can be carried out both by forces of specially created departments within the company, and with the help of internal audit companies in India (the so-called “outsourcers”) specializing in the provision of such services.
Retail auditing is quite versatile in itself and can be used in several situations, besidesthe above example of finding out the reasons for an inexplicable decline in sales. An audit helps to identify new and only emerging segments of the market, outline predictions and assess the advantages of bringing new products to the shelves, analyze new trends in changes in consumer demand and activity. All this allows company managers to have a broad outlook, which in turn brings considerable bonuses and dividends in the competition for the hearts and wallets of end consumers. It should be noted that the analysis of competitors’ activity also takes not the last place in the framework of the retail audit. Any entrepreneur knows first-hand that a competently built strategy to combat competitors is far from an empty phrase.
A Retail audit company that conducts an audit “secretly” may encounter a number of difficulties associated with possible opposition from the staff of the outlet at which the monitoring is carried out, although according to current legislation the collection of information by means of photo and video is not prohibited. Many companies are quite insecure of the collection of information, which may be a trade secret and may in every way impede the auditor. Data collection may also be difficult or even impossible if the studied objects are located in closed cities (institutes – research institutes, etc.). Other difficulties include distorted semi-truthful data received from the internal personnel of the objects under study. There are cases when the audit client itself may provide, at the request of the auditors, information that does not correspond to reality in order to put himself in a better light or to hide some facts that would be negatively perceived by the higher management.