Retail Final Exam

What does the 80-20 Rule mean? a. 80 percent of the buying comes from 20 percent of the vendors. b. 80 percent of the sales come from 20 percent of markdown merchandise. c. 80 percent of the customers pay with 20 percent of their income. d. 80 percent of the sales or profits come from 20 percent of the customers. e. 80 percent of the merchandise is sold at a 20 percent mark-up.

80 percent of the sales or profits come from 20 percent of the customers.

Which of the following would be an example of intertype competition? a. A supermarket and a fresh flower stand. b. A Starbuck's and a McDonald's restaurant. c. A Wal-Mart Supercenter and a CVS/Pharmacy. d. A 7-Eleven convenience store and a Macy's. e. All of the above would be examples of intertype competition.

All of the above would be examples of intertype competition.

Which of the following statements about "centralization" is (are) true? a. Centralization typically increases costs. b. More managers are required in the stores with centralization. c. Centralization allows management to better tailor its offering to the needs of the local market. d. Centralization provides the opportunity to have the best people with the greatest expertise make decisions for the entire corporation. e. All of the above statements about centralization are true.

Centralization provides the opportunity to have the best people with the greatest expertise make decisions for the entire corporation.

Why are airports such a profitable place to have a retail business? a. Airport leases are affordable and short-term. b. Tourists find unique stores at airports not available to them at other shopping centers. c. Travelers tend to carry more money than a traditional shopper. d. Changes in security have encouraged travelers to arrive earlier for their flights than they did in the past, leaving them more time to shop. e. Airport retailers can pay employees lower wages than what they pay at other shopping centers.

Changes in security have encouraged travelers to arrive earlier for their flights than they did in the past, leaving them more time to shop.

To effectively sell merchandise that typically involves extended problem solving by customers, what is the most critical element in the retail mix? a. Price. b. Customer Service. c. Advertising. d. Store Location. e. Merchandise Assortment.

Customer Service.

__________ is the set of activities and programs undertaken by retailers to make the shopping experience more rewarding for their customers. a. Customer empowerment b. Customer engagement c. Customer service d. Retailing strategy e. The retailing concept

Customer service

Which of the following is (are) advantage(s) gained from locating in a freestanding site? a. High rent, but visible location. b. Easy access and parking for customers. c. Synergistic direct competition. d. Restrictive hours. e. All of the above are advantages gained from locating in a freestanding site.

Easy access and parking for customers.

Which of the following is the computer-to-computer exchange of business documents in a standardized format from retailer to vendor and back? a. Data Warehouse. b. Vendor marketing software. c. Customer Data System (CDS). d. Electronic Data Interchange (EDI). e. Data Exchange Network (DEN).

Electronic Data Interchange (EDI).

__________ is expressed as the retailer's sales or profit divided by the number of employees. a. Human resource management b. Employee turnover c. Employee productivity d. Operations management e. Organizational management

Employee productivity

__________ is a retail business strategy that involves using the supply chain management process to introduce fashionable merchandise rapidly and respond to customer demand for the merchandise quickly. a. Quick Response (QR) b. Just In Time Delivery (JITD) c. Lightening Logistics d. Consumer Direct Fulfillment e. Fast Fashion

Fast Fashion

__________ is a method of displaying merchandise in which the retailer exposes as much of the product as possible to catch the customer's eye. a. Tonnage merchandising b. Vertical merchandising c. Frontal presentation d. Mass marketing e. Product visibility

Frontal presentation

Where would you most likely find a lifestyle center? a. At interstate interchanges. b. In high-income neighborhoods. c. In low-income neighborhoods. d. In small towns. e. Near discount store malls.

In high-income neighborhoods.

__________ refers to the way people live, how they spend their time and money, what activities they pursue, and what their attitudes and opinions are about the world in which they live. a. Marketing mix b. Demographics c. Lifestyle d. Target marketing e. Market segmentation

Lifestyle

Impulse buying is associated with which type of buying decision? a. Extended Problem Solving. b. Complex Decision Making. c. Limited Problem Solving. d. Habitual Decision Making. e. Unlimited Problem Solving.

Limited Problem Solving.

Which of the following retailers would most likely be found in a power center? a. Lowe's and Target. b. The Sip and Sup Café and an independent retail bookstore. c. A liquor store, a convenience store, and a laundromat. d. A flower shop, a Kmart, an independent shoe store, and a dry cleaners. e. An independent toy store, women's apparel store, dry cleaners, and shoe store.

Lowe's and Target.

Which type of retail growth strategy is most closely associated with cross-selling? a. Retail Format Development. b. Diversification. c. Market Penetration. d. Market Expansion. e. Market Divestment.

Market Penetration.

A city of 50,000 or more inhabitants, or an urbanized area of at least 50,000 inhabitants, with adjacent communities that have a high degree of economic and social integration with the core community is called a: a. Micropolitan Statistical Area. b. Competitive Statistical Area. c. Statistical Demographic Area. d. Metropolitan Statistical Area. e. Trade area.

Metropolitan Statistical Area.

After enjoying 17 years with her Toyota Camry, Kelly's mechanic told her that it would cost more to fix the transmission than the car was worth. She decided it was time for a new car. In which stage of the buying process is Kelly involved? a. Product selection. b. Need recognition. c. Information search. d. Product examination. e. Cognitive dissidence.

Need recognition.

What is an advantage to a national retailer for selling private labels? (Chapter 13) a. There is less steps and supply chain resources needed to develop private label product. b. The retailer saves costs as it does not need to market private label products. c. There is less risk involved with selling private label brands. d. Private label brands have more clout than national brands. e. Private label brands can fill assortment voids that are not being met by national brands.

Private label brands can fill assortment voids that are not being met by national brands.

What is the term that describes the process of moving returned merchandise to the retailer from the consumer to the distribution center and then to the vendor for the purpose of capturing value or proper disposal? a. Return Logistics. b. Reverse Logistics. c. Outbound Returns. d. Boomerang Effect. e. Reverse Flow-Back.

Reverse Logistics.

__________ is a set of activities and techniques firms employ to efficiently and effectively manage the flow of merchandise from the vendors to the retailer's customers. a. Logistics b. Supply Chain Management c. Total Quality Management (TQM) d. Electronic Data Interchange (EDI) e. Materials Handling

Supply Chain Management

Which of the following is an advantage of using distribution centers (DCs) over direct store delivery? a. Individual stores that forecast and draw from a DC are more cost efficient. b. The DCs have the advantage of keeping backup stock in the store. c. Direct store delivery is always more expensive. d. The DCs enable the retailer to carry less merchandise in the individual stores and lower inventory investments system wide. e. The DC can always deliver faster than a vendor.

The DCs enable the retailer to carry less merchandise in the individual stores and lower inventory investments system wide.

Which of the following statements about the location of departments within retail department and discount stores is true? a. The men's department is generally located in a low traffic area on the second floor or near the back of the store. b. In general in a multi-level store, a space's value increases the further it is from the entry-level floor. c. The best locations on any floor are those that are closest to the store's entrances, main aisles, escalators, and elevators. d. Because many customers turn left when entering a store, the left side is especially desirable floor space. e. Most customers are drawn into the center of a store by the use of a free-form layout.

The best locations on any floor are those that are closest to the store's entrances, main aisles, escalators, and elevators.

What do Southwest Airlines, Panera Bread, and Jenny Craig have in common? a. These firms have established long-term relationships with their manufacturers. b. They are all examples of off-price retailers. c. They are all examples of service retailers. d. They sell tangible products. e. They have high operating margins due to the size of their inventories.

They are all examples of service retailers.

JCPenney carries sizes for big and tall men, but all sizes are not available in all stores. What should JCPenney do in order to communicate this message to their customers? a. They should advertise big and tall men's merchandise on all of their newspaper supplements and broadcast commercials. b. They should train their sales associates to mention this when closing sales with each customer. c. They should advertise this by featuring big and tall men on its "Holiday" catalog. d. They should actively advertise these assortments on the Internet. e. They should create a database of those who purchase merchandise for big and tall men and then market specifically to those shoppers.

They should create a database of those who purchase merchandise for big and tall men and then market specifically to those shoppers.

Which of the following statements about full-line discount stores is true? a. They do not carry private-label merchandise. b. They have a narrow breadth of merchandise. c. They have inconsistent assortments. d. They tend to offer a broad variety of merchandise. e. None of the above statements about discount stores is true.

They tend to offer a broad variety of merchandise.

Access to major highways, pedestrian traffic, and availability of mass transit are examples of which site characteristic? a. Traffic Flow and Accessibility. b. Location Characteristics. c. Restrictions. d. Costs. e. Competitive Advantages.

Traffic Flow and Accessibility.

Grid store layouts: a. are also called loop layouts. b. are cost-efficient. c. encourage impulse purchasing. d. are one of the most aesthetically pleasing designs. e. are used by specialty stores.

are cost-efficient.

Orientation programs: a. may actually hasten turnover as a new employee learns more about the organizational culture. b. are required by the EEOC. c. are excellent sources of performance evaluation information. d. should not last longer than one day, or they become ineffective. e. are critical in socializing new employees and overcoming the differences in the employee's previous and new roles.

are critical in socializing new employees and overcoming the differences in the employee's previous and new roles.

The Mattress Firm sells mattresses, pillows, sound machines, and other items that enhance sleep. The store is popular because many people do not enjoy a full night's sleep, and the Mattress Firm offers products that promise comfortable sleep. The Mattress Firm, therefore, uses __________ segmentation. a. benefit b. demographic c. geographic d. psychographic e. usage

benefit

Matt used to shop for electronics at the closest Best Buy store. But now that he has his iPad, he does his electronic shopping online at bestbuy.com instead of in a Best Buy store. This is an example of __________. a. leveraging. b. efficient fulfillment. c. inconsistent execution of services. d. cannibalization. e. market presence.

cannibalization.

As the owner of a store specializing in men's suits, Brittany can use a retail strategy statement to identify all of the following EXCEPT: a. the store's target market. b. how the store will build a competitive advantage over other similar retailers. c. what services the store will offer its customers. d. the advertising campaign developed to sell last season's merchandise. e. what types of suits the store will stock.

d. the advertising campaign developed to sell last season's merchandise.

The competition between the same types of retailers is called: a. intertype competition. b. indirect competition. c. intratype competition. d. scrambled merchandising. e. vertical integration.

intratype competition.

Which of the following interview questions would be most effective in selecting the best possible job candidate? a. "What retail experience do you have, and why do you want to work here?" b. "Would you do whatever was humanly possible to make sure your customer is completely satisfied with a purchase?" c. "What do you know about this store?" d. "Would you be willing to work unpaid overtime if everyone else had agreed to do the same?" e. "What kinds of experiences have you had shopping and what skills do you have that make you think you can make this store a good shopping experience for others?"

"What do you know about this store?"

The Bird of Paradise flower is one of the world's most stunning tropical flowers standing tall and radiant with color. John owns a florist business and when he knows he's receiving a shipment of flowers from Hawaii, he texts and e-mails all of his customers who he knows enjoys the Bird of Paradise flower and informs them of the upcoming shipment. John's approach is an example of: a. a frequent shopper program. b. special customer sales promotions. c. gaining a competitive advantage. d. 1-to-1 cross selling. e. 1-to-1 retailing.

1-to-1 retailing.

What would the employee turnover be if the store had ten positions for management trainees and four of the trainees left the store during the year? a. 60%. b. 40%. c. 140%. d. 160%. e. There is not enough data to determine a correct percentage.

40%.

Retail buyers often say they are "going to market." What does "market" mean in this context? (Chapter 13) a. A shopping center in which the firm plans to open a new store. b. A concentrated area where vendors are permanently located and show new merchandise during certain times of the year. c. A geographic location where the retailer anticipates remarkably good prospects for above average levels of sales. d. The target consumers at whom a line of merchandise will be aimed. e. The intention to price merchandise at whatever the "going rate" happens to be in a particular location.

A concentrated area where vendors are permanently located and show new merchandise during certain times of the year.

Craig works for a retailer planning what merchandise will be in the assortments, setting prices, negotiating with vendors and planning advertising and marketing for intimate apparel. He attends fashion trade shows and travels to market in New York City nearly every month. What position in the organizational structure of a retailing firm does Craig have? a. Merchandise Planner. b. Divisional Merchandise Manager. c. Store Manager. d. Buyer. e. Department Manager.

Buyer.

Which of the following is a vendor who works with the retailer to develop a better understanding of shopping behavior, create assortments that satisfy consumer needs, and improve the profitability of the merchandise category? (Chapter 12) a. Assortment Manager. b. Category Captain. c. Category Manager. d. Category Specialist. e. Consumer Advocate.

Category Captain.

Which of the following principles explains the success of a shopping center whose tenants include a Kohl's, a Wal-Mart, and a Dick's Sporting Goods? a. Multiple Risk. b. Analog Approach. c. Cumulative Attraction. d. Consumer Spotting. e. Diminishing Adjacency.

Cumulative Attraction.

What is a benefit of having an efficient supply chain? a. Fewer associates are needed to replenish stock. b. More time for customer services. c. Less negotiating with vendors. d. Fewer stockouts. e. Planning strategy becomes more predictable.

Fewer stockouts.

Ashley loves books and often shops at a nearby Books-A-Million. At the beginning of the year, she enrolled in a program where for $5 she would get a percentage off the purchases she made throughout the year. Which of the following best demonstrates this type of approach to customer retention? a. Community. b. Sales Promotion. c. Frequent Shopper Program. d. Personalization. e. Special Customer Service.

Frequent Shopper Program.

What is customer alchemy? a. Converting customers from platinum to gold. b. Increasing the sales made to good customers. c. Increasing the data collection from only platinum and gold customers. d. Converting customers who are loyal to other retailers. e. Listening to customers and altering loyalty programs to better satisfy their needs.

Increasing the sales made to good customers.

Which of the following contain(s) information about the applicant's employment history, previous compensation, reasons for leaving his or her previous employment, education and training, personal health, and references? a. Realistic Job Preview. b. Testing. c. Job Application Forms. d. References. e. Interview.

Job Application Forms.

To effectively sell merchandise to brand loyal customers, what is the most critical element in the retail mix? a. Price. b. Customer Service. c. Advertising. d. Merchandise Presentation. e. Merchandise Assortment.

Merchandise Assortment.

A __________ is responsible for allocating merchandise and tailoring the assortment of several categories for specific stores in a geographic area. a. Merchandise Planner b. Divisional Merchandise Manager c. Store Manager d. Buyer e. Department Manager

Merchandise Planner

To effectively sell merchandise that typically involves impulse buying by customers, what is the most critical element in the retail mix? a. Price. b. Merchandise Presentation. c. Advertising. d. Customer Service. e. Store Location.

Merchandise Presentation.

What is the difference between multiple regression analysis and the analog approach when estimating potential sales for a store site? a. The analog approach gathers its information through nationwide customer surveys. b. Multiple regression analysis uses geo-demographic segmentation systems to determine potential sales in a new market. c. The analog approach uses statistics rather than judgment to predict sales. d. Multiple regression analysis uses statistics rather than judgment to predict sales for a new store. e. Multiple regression analysis cannot be used to determine potential sales like the analog approach.

Multiple regression analysis uses statistics rather than judgment to predict sales for a new store.

__________ is the design and implementation of a retail mix to create an image of the retailer in the customer's mind relative to its competitors. a. Retail perception b. Positioning c. Imaging d. Detailing e. Competitive feedback

Positioning

When Alison went to buy a pair of walking shorts this spring, she first noticed the store had three racks of shorts. Then she noticed all the shorts on one rack were priced at $14.99, all the shorts on the second rack were priced at $19.99, and all the shorts on the third rack were priced at $24.99. What type of merchandise presentation did Alison see? a. Style/Item. b. Price lining. c. Quality/Price. d. Customer benefit. e. Usage.

Price lining.

The __________, often used by catalog retailers and direct marketers, is a scheme for identifying the retailer's best prospects on the basis of how recently they have made a purchase, how frequently they make purchases, and how much they have bought. a. customer pyramid b. inverted pyramid c. yield analysis d. 80-20 Rule e. RFM analysis

RFM analysis

__________ are the application of statistical techniques and models to find patterns in customer purchase data and make recommendations for improving the effectiveness of retailers. a. Regression analysis b. Redress analytics c. Strategic analytics d. Retail cloning e. Retail analytics

Retail analytics

What are two constraints facing store retailers today? a. Leveraging existing assets and pricing. b. Offering unique merchandise and efficient fulfillment. c. Size of the store and inconsistent execution of services. d. Inflation and sale inconsistency. e. Supply chain management and market presence.

Size of the store and inconsistent execution of services.

Why is it important for stores to be designed with flexibility in mind? a. It is less expensive for retailers to build several different types of flexible fixtures than to build one inflexible fixture. b. Stores with flexible designs can respond to market changes without large-scale renovations. c. Customers find it hard to locate merchandise if fixtures are rigid. d. Department managers never know what to expect from the planners' allocations and require the ability to display more merchandise at a moment's notice. e. Environmental legalities require stores to have flexible designs to reduce waste.

Stores with flexible designs can respond to market changes without large-scale renovations.

What is the word used to describe a retailer's merchandise "breadth"? a. Apparition. b. Assortment. c. Diversification. d. Variety. e. Mix.

Variety.

Which of the following statements about warehouse clubs is true? a. Warehouse clubs only sell to ultimate consumers. b. Warehouse clubs have a category specialist format. c. Warehouse clubs typically have low inventory holding costs by carrying a limited assortment of fast-selling items. d. Warehouse clubs provide a very high level of service. e. Warehouse clubs have extensive merchandise depth.

Warehouse clubs typically have low inventory holding costs by carrying a limited assortment of fast-selling items.

Disintermediation occurs when: a. a manufacturer sells directly to a wholesaler, who then sells to a retailer. b. a retailer purchases from a few wholesalers resulting in increased competition and price. c. a manufacturer sells directly to other manufacturers, who distributes to an array of wholesalers. d. a manufacturer sells directly to consumers, bypassing retailers. e. wholesalers disagree about the agreements between the manufacturer and the retailer.

a manufacturer sells directly to consumers, bypassing retailers.

Brand image is: (Chapter 15) a. a set of associations that are usually organized around some meaningful themes. b. the ability of a potential customer to recognize or recall a name of a retailer, product, or service. c. anything linked to or connected with the name in a consumer's memory. d. when consumers indicate they know the brand name when presented to them. e. a distinguishing name or symbol that identifies the products offered by a seller.

a set of associations that are usually organized around some meaningful themes.

A retail market segment that is __________ means that the retailer should know what to do to satisfy the needs for the consumers in the segment. a. actionable b. accessible c. durable d. flexible e. identifiable

actionable

A way to achieve customer alchemy is through __________, which involves offering and selling more products and services to existing customers to increase the retailer's share of wallet with these customers. a. retail accessorizing b. add-on selling c. customer selling d. double-down retailing e. cross merchandising

add-on selling

One of the strategic objectives of human resource management is to: a. supervise operations in all departments throughout the store. b. decrease turnover. c. introduce new services in order to obtain customer loyalty. d. ensure the retailer abides by all state and federal laws. e. align the capabilities and behaviors of employees with the short- and long-term goals of the retail firm.

align the capabilities and behaviors of employees with the short- and long-term goals of the retail firm.

Efficient labor scheduling requires the manager to have readily at hand: a. POS sales data by day and time of day. b. knowledge of store traffic patterns. c. understanding of how store employees impact sales. d. how bad weather will affect store traffic. e. all of the above information.

all of the above information.

Steven was recognized as the best store employee of the year. His name, along with the names of other winners, is engraved on a plaque that is prominently displayed in the store. This is an example of: a. job enrichment. b. an intrinsic reward. c. management by objective. d. an extrinsic reward. e. management by exception.

an extrinsic reward.

As the manager of the home department at a large retail store, Brittney looks forward to a periodic __________, which she receives on the basis of her department's performance relative to its budgeted sales and profits. a. fringe benefit b. commission c. gratuity d. perquisite e. bonus

bonus

Mixed-use developments (MXDs) are popular with retailers because they: a. have higher security. b. bring additional shoppers to their stores. c. offer low rent. d. offer short-term leasing agreements. e. provide free storage facilities to attract retailers.

bring additional shoppers to their stores.

CRM is based on the philosophy that retailers can increase their profitability by: a. providing better assortments. b. expanding their services. c. building relationships with their better customers. d. extending hours of operation. e. advertising more.

building relationships with their better customers.

Alison works in the handbags department of Nordstrom and takes 3% on all purchases. She has become one of the top salespeople in her store and brings home a hefty paycheck. This 3% is best referred to as her: a. fringe benefit. b. commission. c. gratuity. d. perquisite. e. bonus.

commission.

When Alyssa went to pick up her cleaning from a dry cleaning store that guaranteed 24- hour service in all of its ads, she was disappointed to find that her clothes would not be ready until the following day. This is an example of a __________ gap. a. performance b. delivery c. research d. communications e. knowledge

communications

The spending potential index: a. compares what retailers spend on real estate in a given market and compares it to the national average. b. compares sales predictions based on various retail locations. c. provides retailers who are thinking of expanding into international markets with data on what consumers spend. d. compares the local average expenditure by product to the national average amount spent. e. offers retailers information on property values as well as local tax information so they are better able to compare prior to purchasing.

compares the local average expenditure by product to the national average amount spent.

In order to build the brand equity of their private-label merchandise, a retailer needs to: (Chapter 15) a. lower the prices to give the new merchandise a chance against the competition. b. create a high level of brand awareness. c. limit the amount of private-label merchandise to make it more marketable. d. partner with manufacturers to reduce distribution costs. e. develop unfavorable associations for a competitor's private-labels.

create a high level of brand awareness.

The Village Green, a woman's clothing store, took a map of the city and the checks written by its customers during the last quarter. The store's owner then marked the address of each customer on the map with a map pin. By looking at where the pins clustered on the map, she could determine her trade area. She was engaged in: a. geographic research. b. customer spotting. c. financial demographics. d. customer clustering. e. residential research.

customer spotting.

Providing assortments is an advantageous business activity for retailers because it enables the: a. retailer to create a more informational and entertaining environment which would promote more sales. b. retailer to reinvest for the future of the business. c. customer to choose from a wide selection of products, brands, sizes, and prices at one location. d. customer to try more products. e. customer to stock up on the assortments because of bulk availability.

customer to choose from a wide selection of products, brands, sizes, and prices at one location.

Distributive fairness is the: a. perceived fairness of the process used to resolve complaints. b. way store employees can focus on getting the customer back into the store. c. customer's perception of the benefits received compared with his or her costs in terms of inconvenience or monetary loss. d. customer's perception of the inequity of the resolution. e. balanced way of dealing with all customer complaints according to a prescribed protocol.

customer's perception of the benefits received compared with his or her costs in terms of inconvenience or monetary loss.

The training of employees in how to deal with people, provide better assistance to customers, and explain the use of complex products to potential customers reduces the __________ gap. a. communications b. performance c. standards d. knowledge e. delivery

delivery

Kara entered Macy's through the main entrance, went up two escalators, turned to the back of the store and walked to the far corner to finally reach the children's department. In this example, the children's department can be considered a(n) __________ for Kara. a. seasonal needs department b. adjacency department c. impulse department d. demand/destination department e. disjointed/free-form department

demand/destination department

As a(n) __________ type of store manager, Sara treats her employees as equals and asks for their input when she is making a decision about whether to stay open late during the Memorial Day weekend, stock extra inventory for Valentine's Day, or any other decision that will directly affect her employees. a. task-oriented b. autocratic c. job-directed d. dogmatic e. democratic

democratic

A cruise ship specializing in entertaining families with children would most likely be using __________ segmentation to attract business. a. lifestyle b. geographic c. benefit d. psychographic e. demographic

demographic

The Men's Wearhouse stocks 350 different styles and colors of ties. This assortment of ties can be referred to as the store's: a. supply standard. b. complete retail offering. c. breadth of merchandise. d. retail mix. e. depth of merchandise.

depth of merchandise.

The objective of Huff's Gravity Model is to: a. determine the hierarchy of retailing activities according to the assortment of merchandise available. b. define the relative ability of two cities to attract customers from the area between them. c. define the relationship between the size of a shopping area and the area's income levels. d. determine the probability that a customer residing in a particular area will shop at a particular shopping center. e. create a comparative model which allows the retailer to determine the ideal location.

determine the probability that a customer residing in a particular area will shop at a particular shopping center.

What can a retailer do to keep customers from being confused about the retailer's image? The retailer can: (Chapter 15) a. develop an integrated marketing communication program to deliver a comprehensive, consistent message. b. standardize pricing. c. change the offerings based on the current fads to stay contemporary. d. re-design stores to suit contemporary tastes. e. be consistent in competitiveness as it clearly defines top performers in the market.

develop an integrated marketing communication program to deliver a comprehensive, consistent message.

A __________ growth opportunity is one in which a retailer introduces a new retail format directed toward a market segment that's not currently served by the retailer. a. retail format development b. diversification c. market penetration d. market expansion e. market divestment

diversification

A dry cleaner can develop a sustainable competitive advantage by: a. securing a good location. b. developing a customer database to offer special promotions. c. developing a coupon offering with some of the local department stores. d. developing a patented chemical that removes wine stains without harming the fabric. e. doing all of the above.

doing all of the above.

Which of the following businesses would be considered a retailer? a. A concession stand at Disney World. b. Holiday Inn. c. Macy's. d. NetFlix. e. All of the above

e. All of the above

The racetrack layout: a. is also called the free-form layout. b. cannot be used in department stores because it makes large stores look cluttered. c. is not as aesthetically pleasing as the grid layout. d. encourages impulse purchasing. e. is very cost-efficient.

encourages impulse purchasing.

With five children and several nieces and nephews, Brittany has shopped at a lot of toy stores. She really likes The Toy Corner because she can ask for an age-specific toy and if they don't have it, they order it and have it delivered at a price she is willing to pay. Brittany feels that The Toy Corner: a. increases motivational analysis. b. controls attitudinal bias. c. exceeds customer expectations. d. encourages a learned response. e. needs a better customer service strategy.

exceeds customer expectations.

Market expansion opportunities help retailers grow by using: a. existing retail formats in existing market segments. b. existing retail formats in new market segments. c. new retail formats in new market segments. d. new retail formats in existing market segments. e. proven formats in experimental markets.

existing retail formats in new market segments.

The __________ store layout arranges fixtures and aisles asymmetrically. a. loop b. convoluted c. pulsing d. free-form e. suggestive

free-form

In downtown Lincoln, old buildings have been modernized, cracked sidewalks have been replaced with wide brick walks, and a new multipurpose office building has opened. This is an example of: a. modernization. b. trade zone expansion. c. retail segmentation. d. commercialization. e. gentrification.

gentrification.

The difference between the service aspect and the merchandise aspect of the retail offering is __________ caused by intangibility of service. a. inconsistency b. flexibility c. affordability d. planning e. perishability

inconsistency

A party plan system: a. is a form of direct-response advertising. b. is based on the idea that social relationships influence buying habits. c. may be illegal if it develops into a pyramid scheme. d. uses a master distributor as lead salesperson. e. is a recruiting tool for multilevel networks.

is based on the idea that social relationships influence buying habits.

Which of the following retailers is an example of a multichannel retailer? a. Amazon.com. b. Ebay.com. c. j.crew. d. Outback Steakhouse. e. 7- Eleven stores.

j.crew.

A __________ includes the activities the employee needs to perform and the performance expectations expressed in quantitative terms. a. task narration b. job description c. store criterion d. job analysis e. task specification

job description

An electronics retailer surveys past customers and asks them what kind of information they needed before making a purchase. It is trying to bridge the __________ gap by using customer research. a. communications b. knowledge c. performance d. standards e. research

knowledge

In a franchise contract, the franchisee pays the franchisor a: a. bonus if the sales quota is achieved. b. lump sum plus a royalty on all sales. c. start-up costs plus a monthly predetermined cash amount. d. commission on all sales. e. salary plus a variety of employee benefits.

lump sum plus a royalty on all sales.

National brands are also known as __________ brands. (Chapter 13) a. generic b. private-label c. exclusive d. manufacturer e. distributor

manufacturer

Since Kaitlin used __________ to analyze what her customers buy together during a single store visit, she knows to place facial tissues by the cold medicine and sandwich bread by the peanut butter. a. allotment analysis b. computer analysis c. merchandising analysis d. market basket analysis e. location analysis

market basket analysis

A __________ growth opportunity is directed toward existing customers using the retailer's present retailing format. a. retail format development b. diversification c. market penetration d. market expansion e. market divestment

market penetration

A(n) __________ is an assortment of items that customers see as substitutes for one another. (Chapter 12) a. SKU b. merchandise category c. merchandise classification d. inventory unit e. assortment plan

merchandise category

The highest classification level in the buying organization is called the: (Chapter 12) a. category group. b. classification group. c. department group. d. merchandise group. e. division group.

merchandise group.

The process by which a retailer attempts to offer the right quantity of the right merchandise in the right place at the right time and meet the company's financial goals is called: (Chapter 12) a. category management. b. quick response inventory management. c. merchandise management. d. inventory control. e. materials procurement and handling.

merchandise management.

As Ashley drove down Fairfax Road, she noticed a group of adjacent stores. In the group, she saw a hair salon, a Papa John's pizza, a Wal-Mart, an optometrist, and a Save-A-Lot grocery store. All the stores had entrances into a parking lot, which was landscaped with trees and flowers. This is an example of a: a. mixed-use development. b. central business district. c. secondary trade area. d. neighborhood and community shopping center. e. shopping mall.

neighborhood and community shopping center.

The day begins in each Wal-Mart store with the manager leading the famous Wal-Mart cheer. The cheer is a fun and energetic way to remind employees that the customer is always number one. For years, it has been the one way that the company has shared its enthusiasm and can be considered part of the: a. organization structure. b. incentive compensation. c. organization culture. d. empowerment. e. sales promotion.

organization culture.

An off-price store that is owned by manufacturers or retailers is called a/an: a. illegal subsidiary. b. tangential. c. branch. d. parasitic location. e. outlet.

outlet.

Procedural fairness is the: a. balanced way of dealing with all customer complaints according to a prescribed protocol. b. tangible responses given to customer complaints when the customer is unhappy with the results. c. customers' perceptions of the gains received compared to their inconvenience or loss. d. perceived fairness of the process used to resolve complaints. e. manner in which the company has developed specific guidelines to deal with customers' complaints.

perceived fairness of the process used to resolve complaints.

Due to the __________ of services, service retailers like Universal Studios Theme Parks, United Airlines, and Applebee's restaurants sometimes find it difficult to match supply and demand. a. intangibility b. perishability c. inconsistency d. consumability e. compatibility

perishability

Kaitlyn was walking across campus to her chemistry lab when she noticed an area that had Victoria Secret Pink merchandise that was not there earlier in the week. This retail format would be an example of a __________. a. kiosk. b. parasite store. c. store within a store. d. timed leased agreement. e. pop-up store.

pop-up store.

The multiattribute attitude model is designed to: a. predict how a customer will evaluate a product, retailer, or channel based on its attributes and how important these attributes are to the customer. b. forecast inventory needs based on a multiple regression model. c. segment the target market by examining customers' attributes and determine the store's or product's position in the market. d. modify preexisting attitudes by providing customers with a list of benefits (attributes) for shopping at a particular store or buying a particular product. e. shorten the buying process by highlighting the attributes that will most likely affect the buying behavior of the targeted market.

predict how a customer will evaluate a product, retailer, or channel based on its attributes and how important these attributes are to the customer.

In terms of trade areas, the owner of Bubba's Bar and Grille defines his __________ as the geographic area in which 70% of his customers live. a. geographic market b. market segment c. primary trading area d. secondary trading area e. tertiary trading area

primary trading area

At the Home Depot, there is an area of the store that has one of three categories of merchandise throughout the year. In January through March, the area has organization and garage storage merchandise; in April through September, it has lawn, garden and patio merchandise; and, in October through December, it has Christmas merchandise. This special section of the store is an example of a(n): a. consumer motivator. b. freestanding display. c. gondola display. d. impulse product center. e. promotional area.

promotional area.

A retailer whose requests for merchandise are generated at the store level on the basis of sales data captured by point-of-sale (POS) terminals is said to employ a(n): a. cost efficient logistic strategy. b. pull supply chain strategy. c. influential logistic strategy. d. cross check logistic strategy. e. push supply chain strategy.

pull supply chain strategy.

Retailers using a less sophisticated approach in which merchandise is allocated to stores on the basis of forecasted demand is said to employ a(n): a. cost efficient logistic strategy. b. pull supply chain strategy. c. influential logistic strategy. d. cross check logistic strategy. e. push supply chain strategy.

push supply chain strategy.

The first step in the employee management process is: a. recruiting and selecting employees. b. training employees. c. motivating employees. d. evaluating employees. e. discussing compensation with employees.

recruiting and selecting employees.

The best way for a retailer to develop a sustainable competitive advantage is to: a. concentrate on finding the best location. b. concentrate on having the lowest prices in town. c. develop a good distribution system. d. rely on multiple approaches to build as high a wall around its position as possible. e. maintain good vendor relations.

rely on multiple approaches to build as high a wall around its position as possible.

A set of decisions retailers make to satisfy customer needs and influence their purchase decisions is called: a. retailing conglomerate. b. retail mix. c. marketing strategy. d. target group. e. none of the above are decisions retailers use to satisfy customer needs and influence their purchase decisions.

retail mix.

The accounting records for FlashFashions, a women's off-price apparel retailer, showed that it should have inventory of $725,000 at retail. The actual retail value of the inventory in stock was $692,000. To calculate the inventory shrinkage, you would need the store's: a. annual profit. b. profit margin. c. retail sales during the period. d. inventory turnover rate. e. current assets.

retail sales during the period.

Chico's is a national catalog and a specialty store retailer. Its target market is 35-to-55- year-old women. Sixty percent of its customers are college-educated with moderate to high family incomes. Chico's offers private brands, moderate to better-priced women's classic apparel, shoes, and accessories. Its stores are located within village locations and upscale regional malls. Synergies among the store, catalog and website operations provide a competitive advantage over other retailers. This is a description of Chico's: a. retail strategy. b. marketing objective. c. merchandise budget plan. d. mission statement. e. organizational structure.

retail strategy.

Although retailers gain economies of scale from opening multiple locations in an area, they also suffer diminishing returns associated with locating too many additional stores in an area. This is called: a. channel competition. b. economies of scope. c. sales cannibalization. d. channel integration. e. operating costs.

sales cannibalization.

To determine the productivity of store space, apparel retailers are most likely to use: a. sales per cubic foot. b. sales per square foot. c. sales per linear foot. d. gross margin dollars per square foot. e. gross margin dollars per linear foot.

sales per square foot.

A retailer's role in a supply chain is to: a. act as the liaison between manufacturers and wholesalers. b. buy merchandise exclusively from manufacturers. c. negotiate with manufacturers to eliminate a wholesaler. d. satisfy the needs of ultimate consumers. e. sell to wholesalers.

satisfy the needs of ultimate consumers.

While vacationing at the beach, Sara was delighted to see that the local Walgreens carried milk, bread, apples and bananas. Walgreens is exhibiting: a. intratype competition. b. vertical integration. c. backward integration. d. scrambled merchandising. e. channel distribution conflict.

scrambled merchandising.

A multichannel retailer is one that: a. is a combination of single channel retailers. b. channels all assortments through the stores. c. works with other retailers who are in the channel. d. sells merchandise or services through more than one channel. e. buys merchandise from multiple channels to sell in the stores.

sells merchandise or services through more than one channel.

When Ted bought his $500 suit, he asked to have the trousers hemmed. When he picked up his pants after they were altered, he noticed the seamstress had folded the pants under and hemmed them rather than cut the extra material off. Even though the service had been performed, he believed that it was performed in an unacceptable manner. This is an example of a(n) __________ gap. a. education b. service c. performance d. action e. research

service

Retailing is the: a. merchandising component of the retail mix. b. set of business activities that adds value to the products and services sold to consumers for their personal or family use. c. strategy retailers and vendors use to get products into the stores. d. process of offering products in smaller quantities for consumer consumption patterns. e. ability to offer enough variety in a store to encourage one-stop shopping.

set of business activities that adds value to the products and services sold to consumers for their personal or family use.

The percentage of total purchases made by a customer in your store is often called: a. share of wallet. b. worth of wallet. c. shareholder value. d. profit potential. e. net purchases.

share of wallet.

At Sonic Drive In restaurants, employees are timed to measure how quickly a customer can place an order and receive his or her food. When drive-thru employees consistently equal or better the norm, the restaurant manager gives them a $10.00 bonus check. The purpose of this type of incentive is to reduce the __________ gap. a. communications b. delivery c. standards d. knowledge e. performance

standards

When Terri took her kids to Wal-Mart, she noticed a Subway restaurant near the entrance, which prompted her to stop for lunch. This restaurant is a great example of a: a. kiosk. b. parasite store. c. store within a store. d. timed leased agreement. e. pop-up store.

store within a store.

The __________ is the set of steps a retailer goes through to develop a strategy and plan. a. strategic retail planning process b. situation audit c. strategic retail implementation d. strategic retail control process e. tactical retail implementation

strategic retail planning process

By obtaining information about customer preferences and past purchase behavior, retailers operating an electronic channel are able to: a. design more secure sites for credit card users. b. develop faster download times. c. offer lower prices. d. respond immediately to consumer e-mails and inquiries. e. tailor merchandise and recommendations.

tailor merchandise and recommendations.

Macy's sells a variety of winter coats throughout the country focusing delivery in the northern regions first and ending the season rollouts in the south much like the way the cold weather migrates. This management of the winter products can best be described as: a. reducing stockouts. b. improved sale productivity. c. tailoring assortments. d. following seasonal lead. e. tailoring assets.

tailoring assortments.

The major advantage of TV home shopping compared with catalog retailing is: a. its ability to create time and place utility. b. the lack of federal regulation of the media. c. easy return policy for unsatisfactory products. d. its ability to schedule when certain types of merchandise will be shown. e. that customers can see the merchandise demonstrated on TV.

that customers can see the merchandise demonstrated on TV.

Customer Lifetime Value (CLV) is: a. the value placed upon a retailer by a consumer. b. a numerical value of how much a "best customer" shops. c. the expected contribution from customers to the retailer's profits over their entire relationship with the retailer. d. an assessment of how many valued customers shop with a retailer. e. what retailers use to rate the value of guaranteed merchandise.

the expected contribution from customers to the retailer's profits over their entire relationship with the retailer.

Because of the nature of vendor-managed inventory: a. the flow of consumer purchases determines replenishment. b. DCs need to run as deliveries arrive after hours and on holidays. c. there are many delays in replenishment as it's not a collaborative approach. d. third party logistic companies have become necessary. e. EDI is now obsolete.

the flow of consumer purchases determines replenishment.

Ybor Square is a small shopping center located in the part of Tampa Bay, Florida, known as Ybor City. The shopping center building was a former cigar factory that prospered at the turn of the 20th century when Cuban and Italian immigrants settled in the Tampa Bay area. Now it houses small antique stores, bars, and restaurants that have grown to be central to Ybor City's night life. It is an example of a: a. convenience center. b. regional center. c. price-oriented center. d. specialty center. e. theme/festival center.

theme/festival center.

Why are category specialists sometimes called category killers? Because: a. they are often located in dying shopping malls. b. they are located at stand-alone sites. c. of their broad merchandise mix and shallow assortment. d. they can dominate a category of merchandise making it difficult for other retailers to compete. e. they carry mainly technologically obsolete merchandise.

they can dominate a category of merchandise making it difficult for other retailers to compete.

The most fundamental method of coordinating the work activities of retail employees is: a. by not having close supervision to smother employee activities. b. by paying them. c. having a weak organization culture. d. through written policies that list specific expectations and ways that they are enforced. e. trade promotions.

through written policies that list specific expectations and ways that they are enforced.

When given a choice between selling a national brand of makeup and a private-label brand, a mall-based specialty store retailer may choose to develop a private-label brand: a. to prevent its customers from comparison shopping. b. to limit its store traffic to qualified consumers. c. to increase its sales expenses. d. to increase its merchandising flexibility. e. for all of the above reasons.

to prevent its customers from comparison shopping.

Fishing enthusiasts come from miles to shop at Shabby Bills, a shack that sells limited tackle and bait on the North Carolina Outer Banks. Bill attracts this crowd because of his expertise in the Outer Banks and local folklore. The Outer Banks would be considered Shabby Bills': a. site location. b. demographically similar area. c. target market. d. trade area. e. metropolitan complex.

trade area.

Kaitlyn manages 300 store associates at a Wal-Mart Supercenter. Each day, she leads the associates in the Wal-Mart cheer, creates excitement, and "goes the extra mile" with her associates and customers. Shopping in her store is always an enjoyable experience with enthusiastic sales help, contests, and demonstrations. It could be said that Kaitlyn is a __________ leader. a. transactional b. transcendental c. transformational d. relationship-oriented e. task-oriented

transformational

Victoria's Secret designs the merchandise they sell and then contracts with manufacturers to produce it exclusively for them. Victoria's Secret is practicing: a. globalization. b. product-related marketing. c. vertical integration. d. horizontal integration. e. Product diversification.

vertical integration.

The North American Industry Classification System (NAICS): a. was developed by the Federal Trade Commission (FTC). b. uses an 8-digit classification system. c. was created to collect data on business activity in Canada, United States, and Mexico. d. is limited in its use to only retail institutions. e. is used only by the United States.

was created to collect data on business activity in Canada, United States, and Mexico.