Mkt 312 Midterm- Exam que

The top one-fifth of U.S. households earn ____ or more. $45,000 $65,000 $85,000 $100,000

$100,000

**A retailer with sales of $1,000,000 and operating expenses of $350,000 has an operating efficiency rate of 0.25. 0.45. 0.65. 0.75.

0.65

Operating efficiency is expressed as 1 - (operating expenses/company sales). 1 - (company sales/operating expenses). (operating expenses/company sales) - 1. (company sales/operating expenses) - 1.

1 - (operating expenses/company sales).

Credit-card fees paid by retailers average what percent of sales? 0.5 to 0.71 1.5 to 5.0 5.5 to 6.5 7.0 to 10.0

1.5 to 5.0

What is the markup equivalent at cost of a 50 percent markup at retail? 25 percent 50 percent 75 percent 100 percent

100 percent

What percent of all retail sales come from firms with only one outlet? 25 33 50 80

25

Which type of store space allocation begins planning at the individual product level and then proceeds to the category, total store, and overall company levels? A top-down space management approach A bottom-up space management approach Micro-merchandising Category management

A bottom-up space management approach

Which is not a characteristic of recognition of shortage? A good wears down beyond repair. A consumer runs out of an item. A consumer becomes aware of a good or service that has not been purchased before. Service is required when a good can be repaired.

A consumer becomes aware of a good or service that has not been purchased before.

Which of the following is not an advantage of coupons? In many cases, manufacturers pay for the advertising and redemption of coupons. A large percentage of coupons are redeemed by consumers. Coupons are very helpful to an ongoing advertising campaign and increase store traffic. The use of coupons increases the consumer's perception that a retailer offers good value.

A large percentage of coupons are redeemed by consumers.

**Which statement concerning vertical price fixing is correct? The practice was made legal in 1976. A recent Supreme Court ruling legalizes minimum pricing agreements between manufacturers and wholesalers and retailers. The Supreme Court ruling currently applies the "rule of reason" to vertical price fixing. There is currently no legal way for manufacturers and wholesalers to control retail selling prices.

A recent Supreme Court ruling legalizes minimum pricing agreements between manufacturers and wholesalers and retailers.

A customer loyalty program should be designed to appeal to what types of customers? Dissatisfied customers A retailer's best customers Satisfied customers Customers who have recently defected

A retailer's best customers

Which of the following is not a job classification method? Functional Product Associated Combination

Associated

With which type of point-of-purchase display does a retailer exhibit a wide range of merchandise for the customer? Theme-setting display Assortment display Rack display Case display

Assortment display

Which types of service can be used by a retailer to differentiate itself from competition? Peripheral customer service Core customer service Expected customer service Augmented customer service

Augmented customer service

Which statement concerning franchising is correct? Business format franchising accounts for more retail franchising sales than product/trademark franchising. Most franchising sales are from franchiser-owned outlets. Automobile and truck dealers account for the largest segment of the franchise industry in terms of dollar sales. Franchising is not an important factor in the gasoline station industry.

Automobile and truck dealers account for the largest segment of the franchise industry in terms of dollar sales.

Which of the following is not an advantage of rationalized retailing? Better ability to meet local merchandising preferences Lower costs due to quantity purchases of fixtures Reliance on proven store layouts Better ability of consumers to find merchandise in new stores

Better ability to meet local merchandising preferences

**Under the Mazur plan, the individual with complete accountability for controlling expenses and reaching profit goals within his or her department is the general manager. merchandising manager. divisional manager. buyer.

Buyer

Which is not a demographic variable? Language spoken Income Class consciousness Employment status

Class consciousness

________ refers to the extent to which a person desires and pursues social status. Social acceptance Social conformity Socialization skills Class consciousness

Class consciousness

A chain can be defined on the basis of which of the following characteristics? Common ownership of multiple outlets Over dependence on the owner Decentralized purchasing Decentralized decision making

Common ownership of multiple outlet

Executives choose their own combination of salary, bonus, fringe benefits, stock options, and retirement benefits through which system? Salary Straight commission Salary plus commission Compensation cafeteria

Compensation cafeteria

**Which concept recognizes that shopping behavior is less predictable and more individualistic? Component life-styles Perceived risk Reference groups Gender roles

Component life-styles

**Which of the following is a strategy that a manufacturer or wholesaler can use to legally control a good's final retail selling price? Consignment selling Enforcing minimum price levels at the suggestion of a large retailer Meeting with a discounter's competitors to discuss possible actions Requiring discounting retailers to pay invoices upon delivery of merchandise

Consignment selling

____________ occurs when franchisers limit franchisee involvement in the strategic planning process. Focused decision making Constrained decision making Dependent decision making Efficient decision making

Constrained decision making

Which statement concerning the value chain is not correct? Consumers are more concerned with the value chain process than the results of the process. From a customer's perspective, value is the perception the shopper has of a value chain. A retail value chain represents the total bundle of benefits offered to consumers through a channel of distribution. A retail value chain is comprised of such elements as store location, retailer ambiance, and the level of customer service.

Consumers are more concerned with the value chain process than the results of the process.

_________ should be established for as many different types of major crisis situations as possible. Product recalls Contingency plans Trigger points Alternative costs

Contingency plans

**Which form of organization is subject to double taxation? Sole proprietorship Partnership Corporation Franchise

Corporation

__________ involves the policies and practices retailers follow in receiving payments from their customers. Credit management Collections management Liquidity management Crisis management

Credit management

Which pricing strategy is usually used for newspapers, candy, vending machine items and foods on restaurant menus? Leader pricing Flexible pricing Variable pricing Customary pricing

Customary pricing

Which of the following is not characteristic of a straight (gridiron) traffic-flow pattern? Distinct aisles are created. Security is simplified. More floor space is devoted to product displays. Customers are encouraged to browse

Customers are encouraged to browse

From a retail store's perspective, which of the following is not an advantage of using leased departments? Store personnel might otherwise lack the merchandising ability to handle and sell certain goods and services. Customers usually blame problems on the lessee and not on the store. Store costs can be reduced. The store's market can be enlarged by providing one-stop customer shopping.

Customers usually blame problems on the lessee and not on the store.

Which type of display minimizes fixture costs? Dump bin display Ensemble display Rack display Cut case display

Cut case display

__________ are awkward spaces where normal displays cannot be set up. Walkway areas Dead areas Selling spaces Merchandise spaces

Dead areas

____ are objective and quantifiable population statistics that are easily identifiable and measurable; life-styles are the ways in which individual consumers and families (households) live and spend time and money. Psychographics Logistics Semantics Demographics

Demographics

**________ relate(s) more to the job environment. Minimum expectations Desired goals Job compensation Job motivation

Desired goals

Which of the following is not part of situation analysis? Defining an organizational mission Developing sales-based objectives Evaluating ownership and management alternatives Determining the goods/service category to be sold

Developing sales-based objectives

Which advertising medium enables the retail advertiser to have the greatest control over market coverage? Direct mail Telephone directories Radio Daily newspapers

Direct mail

__________ is the only medium that enables the retailer to control market coverage. Weekly newspapers Direct mail Transit advertising Phone directories

Direct mail

Which type of shopper has the highest price elasticity? Personalizing consumer Status-oriented consumer Economic consumer Convenience-oriented consumer

Economic consumer

____________ enables centralized record keeping and lets customers complete transactions 24 hours a day, 7 days a week at bank and non-bank locations. Electronic banking Debit banking Inventory computerization Store systemization

Electronic banking

Which strategy is an important part of customer service? Retail research Employee empowerment Organization mission Cost consciousness

Employee empowerment

Which of the following is an example of a desired goal? A safe work environment Employee empowerment in his/her area of work Fair compensation Basic fringe benefits

Employee empowerment in his/her area of work

Which of the following is not a significant benefit of cross-training? Employee training costs can be reduced. Employee boredom can be reduced. Employee flexibility can be increased. Labor costs can be reduced through shifting responsibilities.

Employee training costs can be reduced.

_____ media coverage means ads reach many people but with relatively low frequency; _____ media coverage means ads are placed in selected media and repeated frequently. Distributed, massed Massed, distributed Extensive, intensive Extensive, distributed

Extensive, intensive

**A firm with a tall organization structure can handle problems quicker than one with a flat organization. True False

False

**The typical U.S. household has annual after-tax income of $75,000. True False

False

A firm with a large number of subordinates reporting to one supervisor has a tall organization. True False

False

A reference group is an informal ranking of people in a culture based on factors such as income, occupation, and education. True False

False

A retailer cannot reduce a shopper's perceived risk. True False

False

Brand-switching is most prevalent with routine decision making. True False

False

Consumers with low self esteem and high perceived risk are likely to skip some steps in the decision process. True False

False

Generally, consumers are more concerned with the value chain process than with the results of the process. True False

False

Limited decision making requires more time than extended decision making. True False

False

Many small retailers use organizational arrangements that are a modification of the Mazur plan. True False

False

Most consumers are more hesitant to react to shortages than to unfulfilled desires. True False

False

Store loyalty increases decision making. True False

False

The retailer must perform all the tasks of retailing. True False

False

The type of perceived risk characterized by wondering whether a good will perform as expected is physical risk. True False

False

he basic Mazur plan groups all retail activities into one functional area. True False

False

Which statement about product/trademark franchising is correct? Franchised dealers sometimes agree to operate under suppliers' names. Dealers operate under the strict control of suppliers. Product/trademark franchising accounts for about 30 percent of all retail franchising sales. Examples are restaurants and real estate establishments.

Franchised dealers sometimes agree to operate under suppliers' names.

**Which type of marketing system is used when a single company performs all production and distribution functions without the aid of other firms? Independent vertical marketing system Partially integrated vertical marketing system Fully integrated vertical marketing system Dual vertical marketing system

Fully integrated vertical marketing system

**Which selection tool enumerates basic functions, the relationship of each job to overall goals, the interdependence of positions, and information flows? Application blank Weighted application blank Goal-oriented job description Traditional job description

Goal-oriented job description

Which of the following is not a basic step in the consumer decision process? Stimulus Problem awareness Information search Goods or service usage

Goods or service usage

Which of the following businesses requires the most involvement by the owner? Hair salon Motel Coin-operated laundromat Movie theater

Hair Salon

_______________ involves recruiting, selecting, training, compensating, and supervising personnel in a manner consistent with the retailer's organization structure and strategy mix. Retail labor relations Human resource management Retail management recruitment Retail personnel motivation

Human resource management

_____ refers to how a retailer is perceived by consumers and others. Evaluation Image Ratings Stagnation

Image

Which method of establishing an overall promotional budget relies on previous budgets in the allocation of funds? All-you-can-afford Competitive parity Incremental Percentage-of-sales

Incremental

Freedom from unionization, stockholder concerns, and a board of directors are advantages of which type of retail establishment? Partnership Leased department Independent Chain

Independent

Gathering a list of alternative goods or services occurs during which step of the consumer's decision process? Problem awareness Information search Evaluation of alternatives Post-purchase behavior

Information search

Which characteristic of service retailing makes expansion of an independent into a chain difficult? Perishability of the service Intangibility of the service Variability in service quality Inseparability of the service provider

Inseparability of the service provider

**Which type of advertisement seeks to keep the retailer's name before the public without emphasizing the sale of goods or services? Institutional advertisement Competitive advertisement Reminder advertisement Pioneer advertisement

Institutional advertisement

**Which statement concerning energy management is not correct? A retailer can reduce energy costs through adjusting interior temperature levels during non-selling hours. It is difficult to reduce total heating, ventilating, and air-conditioning costs for a typical retailer. A firm can reduce energy costs through computerized systems that monitor temperature levels. Fluorescent bulbs require less energy than incandescent bulbs that generate comparable lighting

It is difficult to reduce total heating, ventilating, and air-conditioning costs for a typical retailer.

__________ is the drive within people to attain work-related goals. Job enrichment Job compensation Job satisfaction Job motivation

Job motivation

Which pricing strategy is a form of leader pricing? Early markdowns Fair trade Loss leaders Unit pricing

Loss leaders

**__________ is based on the actual prices received for merchandise sold during a time period less merchandise cost. Planned markup Desired markup Initial markup Maintained markup

Maintained markup

__________ is a proper strategy when customers are highly sensitive to price, low prices discourage actual and potential competition, and retail costs do not rise much with volume. Bait advertising Market penetration Price guarantees Market skimming

Market penetration

Which is not an element of managing a business? The retail organization Human resource management Operations management Merchandise management and pricing

Merchandise management and pricing

Which of the following is not an advantage of advertising? A large audience is attracted. Messages can be lengthy and contain a lot of detail. A large number of alternative media are available. The retailer has control over message content, graphics, timing, and size.

Messages can be lengthy and contain a lot of detail.

**Which approach to space utilization considers the ability of a product to round out a retailer's offering? Sales-productivity ratio Functional product grouping Market-segment product grouping Model stock approach

Model stock approach

Which statement concerning the impact of time demands on a retailer is not correct? The ability or inability to delegate duties affects the number of hours worked. The ability or inability to automate operations affects the number of hours worked. Independent stores often have more intensive participation by the owner than chain operations. Most retailers work only when the store is open.

Most retailers work only when the store is open.

The intangibility of the service offering affects which service retailer the most? Owned goods Rented goods Nongoods Nonrented goods

Nongoods

_____ are the long-run and short-run performance targets a retailer hopes to attain. Criteria Plans Objectives Profits

Objectives

From a leased department operator's perspective, which of the following is not an advantage of using leased departments? Existing stores are well-known. Immediate sales are generated. Operating style and hours are flexible. Expenses are reduced.

Operating style and hours are flexible.

**Which type of marketing system is used when two independently-owned companies perform all production and distribution functions? Independent vertical marketing system Partially integrated vertical marketing system Fully integrated vertical marketing system Dual vertical marketing system

Partially integrated vertical marketing system

Which form of retail organization comprises the smallest percentage of U.S. retail store sales? Sole proprietorship Partnership Corporation Franchise

Partnership

"The revenues from an unrented hotel room are lost forever." This statement refers to which attribute of services? Intangibility of the service Inseparability of the service provider Variability in service quality Perishability of the service

Perishability of the service

__________ are the medium with the longest lead time. Phone directories Direct mail Weekly newspapers Monthly magazines

Phone directories

Which value-chain based concept seeks to capitalize on potential features to gain a head start over the offerings of competitors? Customer loyalty programs Potential retail strategy Expected retail strategy Augmented retail strategy

Potential retail strategy

__________ is an indoctrination on the history and policies of the retailer and a job orientation on the hours, compensation, chain of command and job duties. Pre-training Skill training Human relations Corporate culture

Pre-training

**Which statement concerning the Robinson-Patman Act is correct? Price differences can be justified by differences in costs. The act limits the powers of small retailers. All discounts are illegal. Only sellers' activities are restricted.

Price differences can be justified by differences in costs.

_____ in dollars, _______________, and ____________________ are three profit-based pricing goals. Profit, return on investment, early recovery of cash Profit, market share objectives, early recovery of cash Sales, market share objectives, inflation adjusted dollar profits Sales, return on investment, selection of target market

Profit, return on investment, early recovery of cash

____ include stockholders, customer, suppliers, employees, and government. Customers Publics Threats Opportunities

Publics

Impulse goods are located near a store's entrances in a storability product grouping. Purchase motivation product grouping. market segment product grouping. functional product grouping.

Purchase motivation product grouping.

Which type of product groupings appeal to a consumer's urge to buy products and the amount of time he or she is willing to spend in shopping? Functional product groupings Market segment product groupings Storability product groupings Purchase motivation product groupings

Purchase motivation product groupings

Which form of compensation is an indirect payment? Salary Straight commission Retirement plans Bonus

Retirement plans

Which is not a sales objective? Growth Stability Market share Return on investment

Return on investment

Which statement is not a benefit of formulating a retail strategy? A retailer is forced to study the legal, economic, and competitive market. A retailer is shown how it can differentiate itself from competitors. Sales maximization is stressed. Crises are anticipated and often avoided.

Sales maximization is stressed.

Which form of retail promotion is often criticized based on its use of frivolous selling points and a short-term orientation? Publicity Personal selling Advertising Sales promotion

Sales promotion

**In which approach to space do highly-profitable product categories receive large amounts of space? Sales-productivity ratio Model stock approach Functional product grouping Market-segment product grouping

Sales-productivity ratio

**Which of the following statements about organizational arrangements used by small independent retailers is false? Small retailers generally have little specialization. Small independent retailers have fewer activities to perform than other types of retailers. The owner-manager personally runs the business and oversees employees. Small independent retailers have no branch units.

Small independent retailers have fewer activities to perform than other types of retailers.

**Which retail strategy is an extension of cross-merchandising? Scrambled merchandising Solutions selling Category management Everyday low pricing

Solutions selling

Which of these is not an uncontrollable variable? Consumers Store location Technology Competition

Store location

**___________ encompasses all of the activities involved in managing physical facilities. Retail image Retail atmosphere Store maintenance Energy management

Store maintenance

**Which statement about store maintenance is correct? The quality of store maintenance has little impact on consumers. Energy management costs are not a major expense for supermarkets. Most store fixtures last five years or less. Store maintenance encompasses all of the activities involved in managing a retailer's physical facilities.

Store maintenance encompasses all of the activities involved in managing a retailer's physical facilities.

In which form of compensation are earnings directly tied to productivity? Salary Straight commission Salary plus commission Compensation cafeteria

Straight commission

**Which is not a functional area included in the Mazur plan? Merchandising Strategic planning Publicity Accounting and control

Strategic Planning

Which statement concerning horizontal price fixing is correct? Horizontal price fixing refers to the right of manufacturers to control retail prices. It is not illegal for retailers to reach agreements with one another regarding the use of coupons. There is no legal violation if the resultant prices are "reasonable." Such agreements are illegal under the Sherman Antitrust Act and the Federal Trade Commission Act, regardless of how "reasonable" the prices may be.

Such agreements are illegal under the Sherman Antitrust Act and the Federal Trade Commission Act, regardless of how "reasonable" the prices may be.

**_____ is the manner of providing a job environment that encourages employee accomplishment. Supervision Motivation Compensation Satisfaction

Supervision

Which of the following is not a type of service? Owned-goods service Rented-goods service Tangible-goods service Nongoods service

Tangible-goods service

Which statement concerning independent retailers is correct? An independent retailer owns two or more outlets. The high number of independents is associated with the ease of entry into the marketplace. Few independents are able to cooperate as specialists. Independents represent a very small portion of retailers in the United States.

The high number of independents is associated with the ease of entry into the marketplace.

Which of the following statements about chains is not correct? The dominance of chains varies by type of retailer. Chains account for more than 60 percent of total store sales and employment. The majority of retail chains operate more than 100 outlets. Less than 5 percent of all U.S. retail firms are chains.

The majority of retail chains operate more than 100 outlets.

In personal selling, which of the following is based on the assumption that each customer has a different set of wants? A trial close approach A repetitive sales presentation The need-satisfaction approach The canned sales presentation

The need-satisfaction approach

Which is not generally a characteristic of the organizational pattern of a chain store? Many functional divisions Centralized authority and responsibility The use of a simple control system Standardization of many operations

The use of a simple control system

Which of the following is not an advantage of publicity? A retail image can be presented or enhanced. An objective source presents the message. A mass audience is addressed. There is control over the message content.

There is control over the message content.

Which of the following is not a basic reason for the existence of consumer cooperatives? Some consumers believe they can operate stores as well as or better than traditional retailers. Traditional retailers are doing an increasingly poor job of appealing to consumer niches in categories such as grocery products. Some consumers feel that existing retailers are inadequately fulfilling customer needs with regard to healthful, environmentally safe products. Some consumers believe that existing retailers often make excessive profits and that they can sell merchandise for lower prices.

Traditional retailers are doing an increasingly poor job of appealing to consumer niches in categories such as grocery products.

**An independent retailer has a much simpler organization than a chain retailer. True False

True

**From a retailing perspective, the purchase act may be the most crucial aspect of the consumer decision process. True False

True

A retailer can respond to the poverty-of-time concept by using mail-order, Web sites, and telephone selling. True False

True

A retailer that has distinct departments grouped by market segment in a single store is practicing differentiated marketing. True False

True

Class-consciousness is the extent to which a person pursues social status. True False

True

Cross-shopping takes place when consumers shop for a product category in more than one retail format. True False

True

From the customer's perspective, value is the perception the shopper has of a value chain. True False

True

Human resource management is required of all retailers. True False

True

In the United States, about 12 percent of people move each year. True False

True

Labor costs can amount to over 50 percent or more of a retailer's operating expenses. True False

True

The consumer decision process has six steps: stimulus, problem awareness, information search, evaluation of alternatives, purchase, and post-purchase behavior. True False

True

The equal-store organization is a popular arrangement today for chain retailers. True False

True

The extent to which a consumer searches for information depends, in part, on that person's perception of the risk attached to the purchase of a specific good or service. True False

True

The household life cycle incorporates the life stages of both family and nonfamily households. True False

True

The key step for routine decision making is problem awareness. True False

True

The product classification method of categorizing jobs recognizes that differences exist in the personnel requirements for different products. True False

True

The special human resource environment complicate employee hiring, staffing, and supervision. True False

True

When one talks with friends, fellow employees, professors, and so on, a social cue is received. True False

True

A significant problem with the use of computerized checkouts is UPC symbols are not readable by humans. computerized registers do not instantly record sales. data cannot be stored in the computer's memory bank. there are a large number of employee misrings.

UPC symbols are not readable by humans.

Which is not an advantage of being an independent retailer? There is high flexibility in choosing a store location. Uniform location standards are needed. There is great latitude in selecting a target market. Investment costs can be held down.

Uniform location standards are needed.

Which is not a type of impulse purchase? Completely unplanned Partially unplanned Unplanned convenience Unplanned substitution

Unplanned convenience

Which value-based concept is concerned with a channel of distribution? Perception Expected retail strategy Value chain Augmented retail strategy

Value chain

**Which type of advertising is subject to the rules of the Robinson-Patman Act? Horizontal cooperative advertising Vertical cooperative advertising Institutional advertising Competitive advertising

Vertical cooperative advertising

**_______________ occurs when manufacturers or wholesalers seek to control the retail prices of their goods and services. Vertical price fixing Horizontal price fixing Predatory price setting Consumer cross elasticity

Vertical price fixing

The largest U.S. retail advertiser is McDonald's. Wal-Mart. Sears Holdings. Home Depot.

Wal-Mart.

**Unit-pricing laws are required due to predatory pricing practices by large retailers. a lack of standardized package sizes among manufacturers. unfair competition by large retail chains against smaller independent retailers. item price removal practices by supermarkets with computerized checkouts.

a lack of standardized package sizes among manufacturers.

A systematic procedure for analyzing the performance of a retailer is called control. feedback. strategic planning. a retail audit.

a retail audit

Stockholders, consumers, suppliers, employees, and government are examples of the uncontrollable variables facing a retailer. a retailer's publics. target markets. market segments.

a retailer's publics.

A version of electronic payment that also stores and modifies customer information as transactions occur is an option card. an option credit plan. revolving credit. a smart card.

a smart card.

A retailer plans space management on the total available store space, divides the space into categories, and then works on product layouts in a top-down space management approach. a bottom-up space management approach. micro-merchandising. category-management.

a top-down space management approach.

Channel members collaborate to maximize product category performance by offering product assortments and prices that better address consumer needs in customer loyalty programs. SERVQUAL. customer satisfaction. a value delivery system.

a value delivery system.

A retailer can most effectively respond to the poverty-of-time concept by providing a selection of private label brands. catering to both male and female shoppers. adding on-floor sales personnel. arranging for vans to pick up senior citizen shoppers at designated times and places.

adding on-floor sales personnel.

Usually, the first tool used by a retailer to screen applicants is the personal interview. application blank. psychological test. pre-training session.

application blank.

Gray market goods are products that are targeted to senior citizens. use counterfeit labels. are purchased in foreign markets or goods that have been transshipped from other retailers. are purchased from bankrupt retailers.

are purchased in foreign markets or goods that have been transshipped from other retailers.

For a store-based retailer, _____ refers to the store's physical characteristics that are used to project an image and to draw customers. atmosphere perception storefront visibility

atmosphere

A store's physical characteristics that project an image and draw customers make up its overall retail image. atmosphere. general interior. self-concept.

atmosphere.

Extra elements that differentiate one retailer from another are part of the retailer's expected retail strategy. augmented retail strategy. potential retail strategy. total retail strategy.

augmented retail strategy.

**With a(n) _______________, the amount and timing of markdowns are controlled by the length of time merchandise remains in stock. automatic markdown plan early markdown policy late markdown policy massed markdown policy

automatic markdown plan

__________ restrict the times during which retailers may operate. Blue laws Sunday laws Community laws Prohibition laws

blue laws

In product/trademark franchising, franchised dealers acquire the identity of their suppliers by agreeing to sell the latter's products and/or operate under suppliers' names, whereas in ____________, there is a more interactive relationship between a franchisor and a franchisee. business format franchising product assortment franchising real-time franchising partner-based franchising

business format franchising

The training method which entails presenting an actual or hypothetical problem and learning by doing is __________. live demonstration sensitivity training case study programmed instruction

case study

A relationship-oriented technique in which channel members collaborate to manage products by category rather than by individual item is ____________. category management category assessment category promotion category internationalization

category management

A chain can achieve increased bargaining power through __________. handling efficiencies computer efficiencies media planning centralized buying

centralized buying

**Planning authority ability is limited to top management or ownership in a(n) owner-manager system. professional manager system. centralized structure. decentralized structure.

centralized structure.

Among the many competitive advantages for ________ are bargaining power, cost efficiencies, computerization, access to media, well-defined management philosophies and long-range planning. chain retailers independent retailers consumer cooperatives leased departments

chain retailers

A person who is concerned about the social status associated with goods, services, and particular retailers is best described as innovative. autonomous. class conscious. aggressive.

class conscious.

**Multiple retailers that situate under the same roof (or at one Web site) to share costs and stimulate consumer to visit more often practice cross selling. co-branding. scrambled merchandising. solutions selling.

co-branding.

In order to overcome _________, a retailer must first realize that the consumer decision process does not end with the purchase. cognitive dissonance cognitive awarenes slow involvement high involvement

cognitive dissonance

**Dissatisfaction may result from high perceived risk. high information search. cognitive dissonance. extended decision making.

cognitive dissonance.

When a customer regrets that a purchase was made or wishes that another alternative had been chosen, he or she is experiencing cognitive dissonance. purchase doubt. perceived risk. performance risk.

cognitive dissonance.

Which job classification method is usually used by large retailers? Functional Product Associated Combination

combination

**A chain retailer operated multiple outlets (store units) under ____ ownership. franchised common generic independent

common

A message that has persuasion as its goal is a(n) institutional ad. competitive ad. reminder ad. pioneer ad.

competitive ad.

The development of product-testing programs, and the setting of clear procedures for handling consumer complaints are examples of ______. ethics consumerism bonding volunteerism

consumerism

**The right to safety, the right to be informed, the right to choose, and the right to be heard are all parts of an ethical code of conduct. social responsibility. consumerism. ethics.

consumerism.

The major difference between a contest and a sweepstakes is that the sweepstakes is based upon a mail entry. odds of winning are higher in a contest. sweepstakes requires skill, whereas the contest is based purely on luck. contest requires skill, whereas the sweepstakes is based purely on luck.

contest requires skill, whereas the sweepstakes is based purely on luck.

**In the _____ phase, a retail audit, which is a systematic process for analyzing the performance of a retailer, should be used. planning overview implementation control

control

The _____ parts of a retail strategy are broken down into these basic categories: choosing a store location, managing a business, merchandise management and pricing, and communicating with the customer. uncontrollable controllable definable predictable

controllable

Those aspects of business that a retailer can directly affect, such as store hours and merchandise lines carried, are referred to as controllable variables. demographic statistics. life-style measures. uncontrollable variables.

controllable variables.

Experiential merchandising seeks to add customer excitement by converting shopping from a passive activity to a more interactive one. simplifying the shopping experience. beautifying store interiors. reducing costs.

converting shopping from a passive activity to a more interactive one.

Advertising costs are shared between two or more retailers or a manufacturer, a wholesaler, and a retailer through promotional monies (PMs). promotional allowances. cooperative advertising. slotting fees.

cooperative advertising.

A retailer's _______ customers are worth nurturing with long relationships. passive aggressive casual core

core

Screening, transaction, and collection costs are cost components of inventory management. facilities management. credit management. computerization.

credit management.

A ____ is a distinctive heritage shared by a group of people. family household class culture

culture

A distinctive heritage shared by a group of people is a social class. culture. reference group. household life cycle.

culture.

__________________ reward a retailer's best customers. Value-added services Customer service programs Customer loyalty programs Customer affinity programs

customer loyalty programs

A nursery, lounge, and benches are part of a store's customer space. display space. dead space. functional space.

customer space.

Discount retailers tend to have relatively little functional space. nondisplay space. customer space. selling space.

customer space.

The advantages of __________ and dump bins are reduced display costs and a low-price image. ensemble displays rack displays theme displays cut cases

cut cases

An important component of a customer loyalty program is a ___________. credit card delivery system special sale data base

data base

A retailer can eliminate the risk of nonpayment through requiring that consumers use checks. computerization. debit cards. retailer generated credit cards.

debit cards.

Objective and quantifiable population data that are easily identifiable and measurable are called demographics. life-style variables. social class groupings. family life cycle variables.

demographics.

**Chains generate 75 percent or more of total retail sales for stationery stores. furniture stores. department stores. liquor stores.

department stores

The starting point in developing a retail price strategy is selecting a broad price policy. choosing specific prices. outlining a retail strategy mix. developing objectives.

developing objectives.

Social cues, commercial cues, and physical drives are examples of __________. problem awareness different stimuli decision criteria cognitive dissonance

different stimuli

Compensation includes both __________ payments (such as salaries, commissions, and bonuses) and _____ payments (such as paid vacations, health and life insurance benefits, and retirement plans). straight salary, incentive straight salary, fringe direct salary, bonus direct monetary, indirect

direct monetary, indirect

**A major problem with the ________________ method for planning variable markups is the complexity of assigning costs. competition oriented pricing direct product profitability demand oriented pricing gross margin based

direct product profitability

**A retailer with a(n) __________ uses low prices as the major competitive advantage. discount orientation upscale orientation image orientation focused market

discount orientation

**A _________ is a multi-line firm operating under central ownership. department store chain retailer diversified retailer public retailer

diversified retailer

A firm engaging in more than one type of distribution arrangement is using _____ marketing. dynamic intensive selective dual

dual

Sherwin-Williams' use of sales through both company-owned stores and independent retailers is an example of a direct marketing system. independent channel ownership. partial vertical integration dual marketing.

dual marketing

Which type of marketing system is used when a company is involved in more than one type of distribution arrangement? Independent vertical marketing system Partially integrated vertical marketing system Fully integrated vertical marketing system Dual marketing

dual marketing

Independent retailers own only one retail unit. The high number of independents is associated with the ____________ in the marketplace. size of firms ease of entry target market preferences diversity of consumers

ease of entry

**A medium's _____ relates to the cost of reaching a given number of target customers. reach frequency effectiveness efficiency

efficiency

When small percentage changes in price result in substantial changes in the number of units purchased, demand is considered to be inelastic. elastic. unitary. marginal.

elastic.

Automatic teller machines (ATMs) and the instant processing of retail purchases are part of self-scanning. electronic banking. item price removal. point-of-sales systems.

electronic banking.

Giving employees discretion, within limits, to satisfy a customer is called ____________. employee empowerment value chain customer service customer strategy

employee empowerment

The department store organizational plan which tries to achieve the benefits of both centralization and decentralization is the Mazur plan. main store control. separate store. equal store.

equal store

The buying organization in which department stores try to achieve the benefits of both centralization and decentralization is the _______________. main store control diversified store organization separate store organization equal store organization

equal store organization

When a retailer has a sense of ______, it acts in a trustworthy, fair, honest, and respectful manner with each of its constituencies. responsibility compassion ethics loyalty

ethics

**The minimum value chain elements a given customer segment expects from a given type of retailer is a(n) _______ retail strategy. augmented expected potential rational

expected

The purchase of a life insurance policy often involves ____ decision making. extended limited routine structured

extended

A consumer who makes full use of the decision process and spends a great deal of time evaluating alternatives undergoes extended decision making. limited decision making. routine decision making. high perceived risk.

extended decision making.

**A "Going Back to School" display is an illustration of an ensemble display. True False

false

**A climate-controlled entry's primary purpose is to reduce energy costs associated with heating or cooling. True False

false

**A free-flowing traffic-flow pattern is more conducive to self-service than the straight traffic-flow pattern. True False

false

**A newspaper with a circulation of 600,000 and a per-page rate of $10,000 has a per-page cost per thousand of $60. True False

false

**Department stores are most affected by unit-price regulations. True False

false

**Everyday low pricing is a version of variable pricing. True False

false

**Full vertical integration is commonly used by wholesalers. True False

false

**In demand-oriented pricing, a retailer sets a price floor, the minimum price acceptable to the firm so it can reach a specified profit goal. True False

false

**It is generally easy for retailers to compute price elasticity for their goods and services. True False

false

**Manufacturers or wholesalers cannot legally control the retail prices of their goods and services. True False

false

**Most cooperative advertising involves horizontal agreements among merchants. True False

false

**Most retailers favor the use of PMs (promotional money or push money) from manufacturers due to their added personal incentive and increased channel control. True False

false

**Operations blueprints are ideal for self-service-based retailers. True False

false

**Partially integrated systems give a firm maximum control over its resources and facilities. True False

false

**Self-service-based stores generally devote large proportions of total square footage to merchandise space. True False

false

**The corporation form of retail organization accounts for the majority of all U.S. retail firms that file tax returns. True False

false

**The vertical trend theory describes the steps a consumer goes through from awareness to purchase. True False

false

**With market penetration pricing, a retailer seeks large revenues by setting low prices and selling many units. True False

false

A central premise of a value delivery system is the independence among each channel member. True False

false

A competitive advertisement has awareness as its goal. True False

false

A firm's organizational mission includes its short-term commitment to a place in the market. True False

false

A goods/service category should be chosen after a retailer has developed a well-defined business plan. True False

false

A leased car is an example of an owned-goods service. True False

false

A memorized, repetitive speech given to all customers interested in a particular item is an example of the need-satisfaction approach of selling. True False

false

A retailer still has a risk of nonpayment for merchandise in a debit-card system. True False

false

A socially responsible retailer acts in the best interest of society, without regard for the needs of the company. True False

false

A traditional job description enumerates the relationship of each job to overall goals. True False

false

According to the Robinson-Patman Act, all discounts are illegal. True False

false

Agreements among retailers to charge a certain price are referred to as vertical price fixing. True False

false

All bank cards and most retailer credit cards involve a revolving credit account. True False

false

All of the steps in a retail strategy are independent of each other. True False

false

All retail franchising can be classified as a form of manufacturer-retailer structural arrangement. True False

false

Among retailers, television is the most preferred medium. True False

false

Computerized checkouts are more advanced than electronic point-of-sale systems. True False

false

Consumer cooperatives have not grown in size because of the large required financial investment. True False

false

Consumer loyalty (frequent shopper) programs should be designed to attract and maintain a retailer's new customers. True False

false

Consumer rights can only be protected by the government. True False

false

Debit cards utilize end-of-month billing. True False

false

During recruitment, a retailer's major goal is to generate a list of three to five qualified applicants. True False

false

Employee empowerment means that a retailer places no limits on what an employee can do to satisfy a customer. True False

false

Frequency refers to the number of distinct people who are exposed to a retailer's ads during a specified time period. True False

false

Generally, the storefront does not affect a store's image. True False

false

In general, prototype stores make construction and centralized management control more difficult. True False

false

In the partnership form of retail organization, each partner is not personally liable with regard to other partners acting on behalf of the firm. True False

false

McDonald's is an example of a product/trademark franchising arrangement. True False

false

Media rates are generally lower for manufacturers than for retailers. True False

false

Most consumers complain to retailers when they are dissatisfied. True False

false

Of the different types of retail institutions, independent retailers have the most time to allocate to long-run planning. True False

false

Only expected customer services provide a retailer with a competitive advantage. True False

false

Rationalized retailing programs provide decentralized management controls. True False

false

Retail classifications are mutually exclusive; that is, a retail institution cannot be correctly placed in more than one retail classification. True False

false

Retailers generally emphasize several attributes of a product, whereas manufacturers generally stress price in advertisements. True False

false

Sales objectives are expressed only in dollars. True False

false

The U.S. Supreme Court ruling did not legalize minimum resale price agreements. True False

false

The checkout counter is more easily designed for Web retailers as compared to most physical retailers. True False

false

The most important group of customers to a retailer are its new customers. True False

false

The most widely used retail-pricing technique is prestige pricing. True False

false

The sole proprietorship form of retail organization accounts for the majority of total U.S. retail store sales. True False

false

The top-down space management approach starts at the individual product level. True False

false

The training method characterized by no active participation by trainees is the case study method. True False

false

The training programs used by retailers should be geared only to new employees. True False

false

The use of prototype stores, standardized product lines, and cooperative advertising is generally associated with product/trademark franchising. True False

false

The value delivery system is the same for both store and nonstore-based retailing. True False

false

The winner in both contests and sweepstakes is based upon the participant's skill. True False

false

Tradeoffs between faster delivery times and higher shipping costs are considered as part of energy management. True False

false

Under a one-price policy, a retailer allows consumers to bargain over selling prices, and those consumers who are good at bargaining obtain lower prices than those who are not. True False

false

With a curving traffic flow, displays and aisles are constructed in rectangular or gridiron patterns. True False

false

With cross-training, the tasks of personnel with similar positions in different departments are rather uniform. True False

false

With purchase-motivation product groupings, a store's merchandise is categorized and displayed by common end uses. True False

false

Which is not part of the special human resource environment faced by retailers? Inexperienced workers Few part-time workers Long hours Variable customer demand

few part-time workers

To curb unfair ____ sales practices, the Federal Trade Commission has disclosure requirements and a business opportunities rule. franchisee franchisor wholesaling retailing

franchisor

Prototype stores are commonly used by specialty stores. independent retailers. franchisors and chains. department stores.

franchisors and chains.

A sporting goods store has a camping department that features tents, sleeping blankets, hiking shoes, and knapsacks. This illustrates a storability product grouping. market segment product grouping. purchase-motivation product grouping. functional product grouping.

functional product grouping.

In a _____ classification, jobs are divided among areas such as sales promotion, buying, and store operations; a _____ classification divides jobs on a goods or service basis; and a ______ classification is useful for chains operating in different areas. product, functional, geographic structural, functional, geographic functional, product, geographic functional, tall, diversified

functional, product, geographic

In credit management, the retailer would have minimal eligibility requirements in order to increase sales. should rely on outside credit plans rather than its own. does not have to communicate all policies to both employees and customers. generally needs to balance the ability of credit to increase revenues against the cost of processing credit payments and bad debts.

generally needs to balance the ability of credit to increase revenues against the cost of processing credit payments and bad debts.

Retailers should specify a ____________ category, the line of business, in which to operate. business/product goods/service positioning/image price/quality

goods/service

An advantage of a late markdown policy is lower markdowns are needed to sell merchandise than with an early markdown policy. greater opportunity is given to sell merchandise at original prices. a retailer's cash flow can be improved. the freeing of selling space for new merchandise.

greater opportunity is given to sell merchandise at original prices.

The ________________ outlines the job interactions within a company by describing the reporting relationships among employees. informational organization structure mother hen organization division of labor hierarchy of authority

hierarchy of authority

The sequence of steps that lead a consumer from awareness to purchase is referred to as the vertical trend theory. two-step model of communication. hierarchy of effects model. communication model.

hierarchy of effects model.

The _______________ model describes the sequence of steps a consumer takes from awareness to knowledge to liking to preference to conviction to purchase. retail-purchase-process consumer-decision-process Maslow-need-hierarchy hierarchy-of-effects

hierarchy-of-effects

The equivalent of the storefront for a Web retailer is the __________. banner advertisement logo design home page hot links

home page

**Under a _______________ agreement, two or more retailers share an ad. vertical cooperative advertising horizontal cooperative advertising joint promotional advertising shared promotional advertising

horizontal cooperative advertising

How a retailer is perceived by consumers and others is its image. atmosphere. positioning. self-concept.

image

Of particular concern to chain retailers and franchisors is maintaining a consistent _____ among all branches and units. layout size exterior image

image

Point of purchase promotion consists of __________ displays. ensemble-clothing in-store life-style cut-case

in-store

**With a(n) _____ vertical marketing system, there are three levels of independently owned firms: manufacturers, wholesalers, and retailers. partial full independent interdependent

independent

The _____ of the service provider and his or her services means the owner-operator is often indispensable and good customer relations are necessary. inseparability intangibility perishability variability

inseparability

A(n) _____ advertisement strives to keep the retailer's name before the public without emphasizing merchandise sales. pioneer reminder institutional competitive

institutional

Through __________, a retailer seeks to maintain a proper merchandise assortment while ensuring that operations are efficient and effective. safety stock inventory management effective ordering supply chains

inventory management

The tradeoffs between faster delivery times from suppliers and higher shipping costs is studied as part of credit management. inventory management. store security. computerized controls.

inventory management.

A distinction between publicity and advertising is that advertising uses agencies to place messages. utilizes media, while publicity relies on word-of-mouth. is more controllable. is more credible.

is more controllable.

With __________, the tasks of personnel with similar positions in different departments are rather uniform. cross training job standardization job analysis job specialization

job standardization

A retailer can deploy employees with greater flexibility through the use of __________ and ____________. job standardization, cross-training job analysis, job description self-service, cross-training self-scanning, job standardization

job standardization, cross-training

The job descriptions in a multi-department retailer are uniform for a given position (such as a cashier) in cross-training. job rotation. job standardization. job enlargement.

job standardization.

A major advantage of a Web page versus a direct mail printed catalog is the increased ability to ____________________. keep the page current easily navigate the site generate ideas more rapidly control speed of graphics

keep the page current

A ________ is a department in a retail store that is rented to an outside party. leased department franchised department cooperative department primary department

leased department

The store layout for a Web retailer has two components: the layout of each individual Web page and the graphics that can be downloaded. hot links to other related Web sites. links that move from page to page. banner ads that accompany the Web pages.

links that move from page to page.

During each stage in the development of a retail strategy, retail managers should consider only controllable variables. refrain from "fine-tuning" the strategy. look for both positive and negative feedback. consider no problems with the government to be a form of negative feedback.

look for both positive and negative feedback.

**The creation of regional and local editions has increased the usage of _____ among smaller retailers. radio flyers/circulars transit magazines

magazines

The department store organizational plan in which most authority remains at the headquarters location is the Mazur plan. main store control. separate store. equal store.

main store control

**A pricing approach that is appropriate when a target market is price sensitive is market penetration pricing. market skimming pricing. early recovery of cash. the multistage approach to pricing.

market penetration pricing.

With __________ product groupings, various products that appeal to a given target market are placed together. market segment purchase motivation storability based functional based

market segment

**In ________, a retailer sets prices by adding per-unit merchandise costs, retail operating expenses, and desired profit. demand pricing markdown pricing markup pricing prestige pricing

markup pricing

A _____ is a sign that displays the store's name. storefront marquee display prototype

marquee

With ____ marketing, a firm sells goods and services to a broad spectrum of consumers. concentrated differentiated mass segmented

mass

A discount store attempting to sell its goods and services to a broad spectrum of consumers is employing a strategy of multiple segmentation. market segmentation. mass marketing. target marketing.

mass marketing

The area where non-displayed items are kept in stock is called dead space. personnel space. merchandise space. customer space.

merchandise space.

**The basic Mazur plan divides all retail activities into four functional areas: _____, _____, __________, and ____________. merchandising, publicity, store management, accounting/control merchandising, buying, store management, accounting/control buying, selling, store operations, accounting/control buying, merchandising, store operations, financial/accounting

merchandising, publicity, store management, accounting/control

**Loss leaders are prohibited by minimum-price laws. the Robinson-Patman Act. vertical price fixing legislation. horizontal price fixing legislation.

minimum-price laws.

The reasons for a consumer's behavior are known as ____. attitudes opinions viewpoints motives

motives

Among retailers, _____ is the most preferred medium. television newspaper outdoor transit

newspaper

When retailers identify specific customer segments and develop unique strategies to meet the desires of these segments, they are using mass merchandising. niche retailing. bifurcated retailing. middle market retailing.

niche retailing.

An analysis of the success of a promotion plan depends on the _____ sought. objectives reach frequency image

objectives

A retail strategy is the overall plan or framework of action that guides a retailer. Ideally, this plan will be at least __________ in duration and will outline the mission, goals, consumer market, overall and specific activities, and control mechanisms of the retailer. six months one year five years ten years

one year

With a(n) _______________, a customer must pay the bill in full when it is due. revolving credit account open credit account option credit account customer self checkout

open credit account

A consumer must pay his/her bill in full when it is due in a(n) open credit account. option credit account. revolving credit account. rotating credit account.

open credit account.

**A retailer can standardize the running of its business (such as order taking and food service delivery for a fast-food franchise) through using a(n) operations blueprint. modular store. prototype store. prefabricated store.

operations blueprint

A retailer needs to list all of the operating functions to be performed with __________. rationalized retailing operations blueprints prototype stores space management

operations blueprints

A true sales employee is a(n) __________ salesperson. sales-engineer missionary-type order-getting order-taking

order-getting

A salesperson that can be described as the true "sales" employee is a(n) order-getting salesperson. order-taking salesperson. order-filling salesperson. missionary salesperson.

order-getting salesperson.

An __________ is a retailer's commitment to a type of business and to a distinctive role in the marketplace. ownership agreement organizational mission objectives statement operating statement

organizational mission

A retailer's commitment to a type of business and to a distinctive role in the marketplace is its objectives. organizational mission. retailing concept. image.

organizational mission.

A small-town retailer may lose part of his/her local shoppers due to ____. outshopping risk attitudes dissonance

outshopping

The notion that some shoppers travel significant distances to shop is referred to as perceived risk. outshopping. problem awareness. component life-styles.

outshopping.

The use of an outside organization to develop and maintain a retailer's Web site illustrates _____. computerization rationalization outsourcing logistics

outsourcing

An appliance retailer decides to have an independent trucker handle delivery of its appliances. This strategy illustrates rationalized retailing. the wheel of retailing. the retail life-style. outsourcing.

outsourcing.

**With a(n) ________ vertical marketing system, two independently owned businesses along a channel perform all production and distribution functions without the aid of the third. partially integrated fully integrated independently integrated interdependently integrated

partially integrated

Retail advertising incorporates payment for media. a personal presentation. a format which can be adapted to individual consumers. an unidentified sponsor.

payment for media.

Status-oriented consumers perceive competing retailers as similar to one another and shop around for the lowest possible prices. look for nearby locations and store hours. perceive competing retailers as quite different. seek retailers with strong assortments in the product categories under consideration.

perceive competing retailers as quite different.

With extended decision making, consumer characteristics have little impact on purchases. perceived risk of all kinds is high. problem awareness is the key step in the consumer decision making process. the potential for cognitive dissonance is low.

perceived risk of all kinds is high.

From the customer's perspective, value is the _____ the shopper has of a value chain. measure actualization realization perception

perception

Store security involves both _____ and ______ security. employee, management employee, customer personal, merchandise inventory, non-inventory

personal, merchandise

Job analysis is used in which of the following personnel activities? Personnel selection Recruitment Training Supervision

personell selection

Cross-training can be best defined as personnel learning tasks associated with more than one job. developing clear performance standards for employees and holding them accountable for these standards. training employees through multiple methods. training employees through in-class and on-the-job methods.

personnel learning tasks associated with more than one job.

**Retailers may try to minimize _________ by insisting on off-the-job clothes changing and other tactics. personnel space merchandise space dead space customer space

personnel space

A(n) ____________________ performs all of the tasks of a computerized checkout and also verifies check and charge transactions, provides instantaneous sales reports, monitors and changes prices, sends intra- and inter-store messages, evaluates personnel profitability, and stores data. point-of-sale system electronic credit management system computer-based information system computerized checkout register system

point-of-sale system

Value chain elements not yet perfected by a competing firm in a retailer's good/service category are a retailer's expected retail strategy. augmented retail strategy. potential retail strategy. total retail strategy.

potential retail strategy.

The increased number of working women, the commute between work and home, and the greater number of people working at second jobs contribute to ____________. poverty of time increased consumer sophistication blurring gender roles component life-styles

poverty of time

Minimum-price laws were intended to protect small retailers from __________ by larger competitors. unit pricing predatory pricing minimum pricing price discrimination

predatory pricing

If it is difficult to evaluate the characteristics of alternative goods or services, consumers will make a decision based upon brand name, store name, or ____. location price delivery installation

price

The ______________________ relates to the sensitivity of buyers to price changes in terms of the quantities they will buy. retail consumer shopper perception local retail pricing environment law of consumer demand price elasticity of demand

price elasticity of demand

With __________, various retailers continually lower prices below regular amounts and sometimes below merchandise costs to lure consumers from competitors. elastic demand inelastic demand price wars minimum prices

price wars

The _______________ is a concept stating that many consumers feel high prices connote high quality and low prices connote low quality. cost-oriented pricing price-quality association high-low pricing everyday-low pricing

price-quality association

Retailers are able to exert channel control through franchising. pre-ticketing merchandise. private branding. exclusive distribution.

private branding

With ________, retailers may gain significant power over wholesalers and manufacturers by attaining brand loyalty for their products, converting brand loyalty to store loyalty, and requiring items to be made to specifications. popular labeling individual labeling manufacturer labeling private labeling

private labeling

At the _________ stage in the decision process, the consumer not only has been aroused by social, commercial, and/or physical stimuli, but also recognizes that the good or service under consideration may solve a problem of shortage or unfulfilled desire. problem solving problem probing problem avoidance problem awareness

problem awareness

The job classification method that divides jobs on a goods or service basis is functional. product. associated. combination.

product

A distributed promotion effort is used by retailers who have seasonal sales. promote constantly throughout the year. use cooperative advertising. advertise very little around holidays and store openings.

promote constantly throughout the year.

A __________ is comprised of advertising, public relations, personal selling, and sales promotion. promotional mix sales mix promotional budget promotional campaign

promotional mix

A _________ is used by franchisors and chains that seek a uniform image. unique building recessed storefront prototype store prefabricated building

prototype store

When chain retailers have each outlet conform to relatively uniform construction, layout, and operations standards, they are likely to use modular stores. prefabricated stores. prototype stores. franchised stores.

prototype stores

A retailer has no control of the message with _____. selling advertising publicity promotion

publicity

A retailer tries to appeal to impulse buying through the use of __________ product groupings. market segment purchase motivation storability based functional based

purchase motivation

The highest degree of centralized management control occurs in __________. space management job standardization prototype stores rationalized retailing

rationalized retailing

The opposite strategy to having a distinctive merchandising approach is ___________. rationalized retailing prototype stores job standardization top-down space management

rationalized retailing

**Most aspects of a chain's operations are performed with strict operating procedures for each phase of business with modular stores. prefabricated stores. prototype stores. rationalized retailing.

rationalized retailing.

**The highest degree of uniformity in operations is associated with modular stores. prefabricated stores. rationalized retailing. prototype stores.

rationalized retailing.

High employee turnover leads to increased ____, _____, and ______ costs. salary, fringe, incentive direct, indirect, fringe recruitment, training, supervision warehousing, selling, management

recruitment, training, supervision

Aspirational, membership, and dissociative are all examples of social classes. life-styles. family life cycle changes. reference groups.

reference groups.

The use of a hotel room by a tourist is an example of a(n) __________. rented good owned good nongood service tangible good

rented good

The basic format or structure of a business is referred to as a ________. retail store retail institution retail strategy retail niche

retail institution

A __________ is an unincorporated retail firm owned by two or more persons, each with a financial interest. retail partnership sole proprietorship limited corporation private corporation

retail partnership

Retailers with large capital expenditures in land, buildings, and equipment often specify _______________ as a goal. return on sales return on costs return on income return on investment

return on investment

*When a customer is billed monthly on the basis of his/her outstanding cumulative balance, this is a(n) open account. open credit account. revolving credit account. option credit account.

revolving credit account.

The training method that places trainees into real-life situations and has them act out conflicts is lecture. case study. competency-based instruction. role playing.

role playing.

A customer exhibiting brand loyalty in a purchase undergoes extended decision making. limited decision making. routine decision making. high perceived risk.

routine decision making.

Growth, stability, and market share are the _____ objectives most often sought by retailers. profit image customer sales

sales

With the percentage-of-sales method, a retailer ties its promotion budget to __________. sales revenue promotional budgets promotional costs profit plans

sales revenue

A retailer assigns floor space on the basis of sales or profit per foot with the _____________. assortment-stock plan customer-appeals approach sales-productivity ratio model-stock approach

sales-productivity ratio

**A major problem associated with the checkout counter for Web retailers is security considerations. download time. upload time. design costs.

security considerations.

Under the Robinson-Patman Act, a manufacturer can legally practice price discrimination through providing cumulative quantity discounts. selling products that are physically different to different retailers. refusing to sell to retailers that discount prices. providing larger promotional discounts to larger retailers.

selling products that are physically different to different retailers.

The training method that uses extensive interaction and is good for supervisors as a tool for understanding employees is sensitivity training. conference. behavior modeling. demonstration.

sensitivity training.

After situation analysis, a firm defines its organizational mission. sets its objectives. selects a target market. develops an overall strategy.

sets its objectives.

The first step in retail strategy development is __________. situation analysis financial review goal articulation store positioning

situation analysis

An informal ranking of people based on income, occupation, education, and other factors is social class. reference group. family life cycle. household life cycle.

social class.

The stimulus a consumer receives from talking to friends, relatives, and so on is known as a social cue. commercial cue. physical drive. conversational stimulus.

social cue.

The activities that seek to balance corporate citizenship with a fair level of profits for stockholders, management, and employees are referred to as consumerism. an ethical code of conduct. social responsibility. ethics.

social responsibility.

The sale of a complete dinner that needs to be reheated in one's home by a supermarket chain best illustrates __________. passive shopping scrambled merchandising cross selling solutions selling

solutions selling

A ____ is a cue or a drive meant to motivate or arouse a person to act. drive motive stimulus motivator

stimulus

A(n) ____ is the total physical exterior of the store itself. image marquee storefront exterior

storefront

A _____ traffic flow is most often used by food retailers, discount stores, hardware stores, and other shopping-oriented stores. curved (free-flowing) straight (gridiron) consistent rationalized

straight (gridiron)

Displays and aisles are constructed in a rectangular pattern in a storability product grouping. market segment product grouping. straight (gridiron) traffic-flow pattern. free-flowing traffic-flow pattern.

straight (gridiron) traffic-flow pattern.

With a _________ plan, a worker is paid a fixed amount per hour, week, month, or year. combination compensation collective bargaining straight salary straight commission

straight salary

An organization with several levels of managers that is characterized by close supervision and with fewer workers reporting to each manager is called a tall organization. flat organization. geographic classification. span of control.

tall organization

A retailer should carry out a task only if it is desired by the __________. retailer's management target market current customers retailer's board

target market

The customer group sought by a retailer is called the __________. target market customer base mass market core customer

target market

An independent vertical marketing system is most likely to be used when task specialization is desirable. manufacturers and/or retailers are large. selective or exclusive distribution is sought. company resources are high.

task specialization is desirable.

The greatest impact of computers on retail operations has been on credit management. the checkout process. energy management. store layout decision making.

the checkout process.

The ease of entry into retailing is reflected in high retailer operating costs. the low efficiency of many retailers. the higher failure rate among newer firms. the low profitability of many retailers.

the higher failure rate among newer firms.

A major advantage of personal selling in comparison to other forms of promotion is that several product attributes can be discussed at the same time. a mass audience is addressed. per-customer costs are low. the message can be adapted to the needs of each individual customer.

the message can be adapted to the needs of each individual customer.

Reach refers to the number of distinct people exposed to a retailer's promotion efforts in a specific period. total circulation in all geographic areas. total circulation less waste coverage. the average number of times each person is exposed to a retailer's ads in a specific period.

the number of distinct people exposed to a retailer's promotion efforts in a specific period.

**The sensitivity of buyers to price changes in terms of the quantities they will buy is referred to as elastic demand. inelastic demand. unitary demand. the price elasticity of demand.

the price elasticity of demand.

Prestige pricing is based on markup pricing. competition-oriented pricing. cost-oriented pricing. the price-quality association.

the price-quality association.

**Vertical price fixing was developed by manufacturers to protect themselves from hard bargaining by massive retail chains. themselves from government intervention. the reputations of their brands based on repeated price cutting by discount retailers. consumers from price competition.

the reputations of their brands based on repeated price cutting by discount retailers.

Perceived risk is high in all of the following situations except when the brand is new to the market. the shopper has high experience with the retailer and brand. there are many alternatives from which to choose. the purchase is socially visible.

the shopper has high experience with the retailer and brand.

In business format franchising, franchisees do not receive the right to operate under suppliers' names. prototype stores, standardized merchandise lines, and cooperative advertising are rarely used. dealers operate relatively autonomously from suppliers. there is a more interactive relationship between the franchiser and the franchisee than with product/trademark franchising.

there is a more interactive relationship between the franchiser and the franchisee than with product/trademark franchising.

The __________ on retail owners are influenced both by consumers' shopping patterns and by the owners' or managers' ability to automate operations or delegate activities to others. financial demands expertise demands time demands pressure points

time demands

With the __________ space management approach, a retailer starts with its total available store space, divides the space into categories, and then works on product layouts. top-down bottom-up micro-merchandising profit-based

top-down

While a _______________ contains each position's title, relationships, and the specific roles and tasks to be performed on an ongoing basis, a(n) _____________________ enumerates basic functions, the relationship of each job to overall goals, the interdependence of positions, and information flows. formal job description, informal-based job description traditional job description, goal-oriented job description structured job description, unstructured-based job description concurrent job description, static-type job description

traditional job description, goal-oriented job description

**Cumulative quantity discounts are harder to justify under the terms of the Robinson-Patman Act than non-cumulative quantity discounts. True False

true

**Merchandise assortment, as well as the types of goods and services sold, has an impact on the initial investment needed to start a business. True False

true

**Store maintenance encompasses all the activities in managing physical facilities. True False

true

**Tactics encompass a retailer's daily and short-term operations. True False

true

**The objective-and-task method is probably the best promotional budgeting technique. True False

true

**The use of centralized decision making by chains can result in a chain's not adapting to a local market's needs. True False

true

**With a market skimming strategy, a firm charges premium prices and attracts customers less concerned with price than service, assortment, and prestige. True False

true

A clear organizational mission enables a retailer to gain a consumer following and distinguish itself from competitors. True False

true

A cut case is an inexpensive display in which merchandise is left in the original carton. True False

true

A firm with $600,000 in sales and $200,000 in operating expenses has an operating efficiency rate of 67 percent. True False

true

A great deal of competition in retailing is due to the ease of entry into retailing. True False

true

A major advantage of a Web site versus a traditional store display is that the Web site can be tailored to the individual customer. True False

true

A motivated employee requires fulfillment of both minimum expectations ("dissatisfiers") and desired goals ("satisfiers"). True False

true

A retailer can reduce its vulnerability to insurance claims through no-slip carpeting, and frequent mopping and inspecting of wet floors. True False

true

A retailer can reduce the adverse effect of a crisis with a good contingency plan. True False

true

A retailer's desired mix of new versus loyal customers depends on that firm's stages in its life cycle. True False

true

A retailer's discontinuing its own credit card in favor of Visa and MasterCard illustrates outsourcing. True False

true

A shoe store is a good example of a retailer whose merchandise space takes up a large percentage of total store space. True False

true

A signal or cue as to the success or failure of a part of a strategy is called feedback. True False

true

A supermarket can overcome consumer resistance to item price removal through legible shelf signs noting prices of each item. True False

true

Advertising clutter is a problem with transit advertising. True False

true

Advertising is distinguished from publicity on the basis of no payment being made for media costs in publicity. True False

true

An advantage of a leased department from the leased department operator's perspective is the ability to use an existing store's traffic. True False

true

An application blank should be used in conjunction with a job description. True False

true

An effective customer loyalty program requires that a retailer maintain a data base that is continuously updated. True False

true

An independent vertical marketing system is often used by stationery stores and gift shops. True False

true

An option credit account is a form of a revolving credit account. True False

true

An order-taking salesperson is involved in routine clerical and sales functions. True False

true

Atmosphere refers to a store's or Web site's physical characteristics that project an image and draw customers. True False

true

Both retail chains and franchisors seek a consistent image across all units. True False

true

Chain retailers can achieve cost efficiencies by buying direct from manufacturers by bypassing wholesalers. True False

true

Cut cases and dump bins are associated with a low-price image. True False

true

Displays, prizes, and samples are considered parts of sales promotion. True False

true

Dual marketing allows a company to appeal to different market segments. True False

true

Due to its lack of control, publicity should be viewed as a complement to other media, and not as the whole media mix. True False

true

Electronic banking involves both automatic teller machines (ATMs) and the instant processing of retail purchases. True False

true

Ethics relates to moral principles, social responsibility involves acts benefiting society, and consumerism involves protection of consumer rights. True False

true

Flyers and circulars are both characterized by a high throwaway rate. True False

true

Gray market goods are sold by unauthorized dealers. True False

true

Ideally, a retail plan should be at least one year in duration. True False

true

If relatively small percentage changes in price result in substantial percentage changes in the number of units purchased, then price elasticity is high. True False

true

In an open corporation, stock is available for public purchase. True False

true

In retailing, market share is often an objective only for large retailers and retail chain. True False

true

In the United States, there are approximately 2.4 million different firms defined as retailers by the Bureau of the Census. True False

true

Independent retailers have a great deal of flexibility in choosing retail formats and locations. True False

true

It is common for a chain retailer to have high bargaining power in dealing with suppliers due to the large volume of its total purchases. True False

true

Job analysis is used for selecting personnel, establishing performance standards, and assigning salaries. True False

true

Job standardization, cross-training, and self-service merchandising can all improve personnel productivity. True False

true

Loss leaders are restricted by minimum-price laws. True False

true

Manufacturers can exert channel control through pre-ticketing merchandise. True False

true

Many new retail businesses fail because the owner does not correctly project the financial resources needed to open and operate the firm. True False

true

Many of the principles of atmospherics apply to both store and nonstore retailers. True False

true

Mass merchandising is an opposite positioning philosophy to niche retailing. True False

true

Multilevel stores must have some form of vertical transportation. True False

true

Perishable products generally are displayed on the basis of storability product groupings. True False

true

Personal abilities include aptitude, education, and experience. True False

true

Personnel productivity can be improved through shifting responsibilities to consumers through the use of self-service facilities. True False

true

Prestige pricing is based on the price-quality association. True False

true

Public relations may be personal or nonpersonal, paid or nonpaid, and sponsor-controlled or not controlled by sponsors. True False

true

Rationalized retailing programs better enable shoppers to find merchandise in chain stores they have not shopped in before. True False

true

Retailers can help implement a consistent retail image through the use of prototype stores. True False

true

Retailers can increase their channel control through use of private branding. True False

true

Retailers often rely on employee recommendations or advertisements to recruit entry-level personnel. True False

true

Situation analysis seeks to answer two questions: "What is the retailer's current status?" and "In which direction should the retailer be heading?" True False

true

Store security includes both personal security and merchandise security. True False

true

The customer base, customer service, customer satisfaction, and loyalty programs and defection rates are key concepts in applying relationship retailing. True False

true

The difference between initial and maintained markup is that maintained markups reflect additional markdowns, added markups, shortages, and discounts. True False

true

The four elements of promotion are advertising, public relations, personal selling, and sales promotion. True False

true

The high number of independent retailers is associated with the ease of entry into the marketplace. True False

true

The optimum value-based retail strategy to a retailer is a potential retail strategy. True False

true

The perceived image of a retailer is difficult to change once established. True False

true

The quality of store maintenance affects consumer perceptions of the retailer, the life span of facilities, and operating costs. True False

true

There are major store security issues that need to be resolved by retailers that plan to use self-scanning. True False

true

Two ways of calculating a markdown are the markdown percentage and the off-retail markdown percentage. True False

true

Under the model stock approach, a retailer determines the amount of floor space necessary to carry and display a proper assortment of merchandise. True False

true

With a straight commission plan, employee earnings are directly tied to productivity. True False

true

With an owner-manager management system, planning tends to be less formal and more intuitive. True False

true

With computerized systems, operators can adjust temperature, lighting, heat, and air-conditioning in multiple store units from one central office location. True False

true

**Recognition of ________ occurs when a consumer becomes aware of a good or service that has not been bought before or a retailer that has not been patronized before. wishful thinking brand loyalty budget assessment unfulfilled desire

unfulfilled desire

The aim of __________ legislation is to enable consumers to compare the prices of products available in many sizes. price fixing fair trade price discrimination unit pricing

unit pricing

The total bundle of benefits offered to customers through a channel of distribution is referred to as an augmented retail strategy an expected retail strategy value the value chain.

value

A retail ____________ represents the total bundle of benefits offered to consumers through a channel of distribution. value chain value perception value measure value initiative

value chain

The members of a distribution channel jointly represent a(n) _______________, which comprises all of the activities needed to develop, produce, deliver, and sell and service particular goods and services. channel of distribution integrated distribution channel independent distribution channel value delivery system

value delivery system

With a(n) ________________, a retailer purposely adjusts markups by merchandise category. automatic markup policy uniform markup strategy variable markup policy maintained markup strategy

variable markup policy

Under __________, a retailer alters prices to coincide with fluctuations in costs or consumer demand. flexible pricing leader pricing variable pricing odd pricing

variable pricing

A ____________ consists of all the levels of independently owned businesses along a channel of distribution. horizontal marketing system vertical marketing system homogeneous marketing system heterogeneous marketing system

vertical marketing system

The franchising structural arrangement in which a wholesaler organizes a franchise system and grants franchises to individual retailers is known as ____ wholesaler-retailer franchising. voluntary mandatory selective preferred

voluntary

The required number and type of employees needed can be pre-determined using a(n) __________. job description job analysis workload forecast organization chart

workload forecast