Chapter 13

49) The merging of consumers, products, prices, and retailers is called ________. A) retail conglomeration B) consumer convergence C) price merging D) retail convergence E) retail clustering

D) retail convergence

25) ________ are two or more outlets that are commonly owned and controlled. A) Chain stores B) Convenience stores C) Off-price retailers D) Independent off-price retailers E) Power centers

A) Chain stores

20) ________ have filled the ultralow-priced, high-volume gap by buying at less-than-regular wholesale prices and charging consumers less than retail. A) Off-price retailers B) Discount stores C) Convenience stores D) Chain stores E) Limited-service retailers

A) Off-price retailers

24) ________ operate in warehouse-like facilities, sell a limited selection of items, and offer few frills. Customers pay annual membership fees and are able to purchase goods at deep discounts. A) Warehouse clubs B) Independent off-price retailers C) Factory outlets D) Discount stores E) Superstores

A) Warehouse clubs

58) ________ includes all activities involved in selling goods and services to those buying for resale or business use. A) Wholesaling B) Retailing C) Franchising D) Discounting E) Disintermediation

A) Wholesaling

89) You own an independent store in your neighborhood. You still like to offer fresh seafood in your meat display case. Which type of wholesaler might best serve you? A) cash-and-carry wholesaler B) rack jobber C) drop shipper D) mail-order wholesaler E) agents and brokers

A) cash-and-carry wholesaler

15) Which type of store carries a deep assortment, has knowledgeable staff, and might actually be viewed as a giant specialty store? A) category killer B) chain C) factory outlet D) shopping center E) independent

A) category killer

96) Which of the following is most likely the greatest factor in the increasingly short life cycle of new retail forms? A) changes in technology B) economic swings C) import and export regulations D) stagnating retail convergence E) global expansion of major retailers

A) changes in technology

43) A ________ contains between 15 and 40 retail stores, including a department or variety store, a supermarket, specialty stores, professional offices, and sometimes a bank. A) community shopping center B) neighborhood shopping center C) strip mall D) regional shopping center E) power center

A) community shopping center

13) Which type of small store carries a limited line of high-turnover convenience goods and makes most of its revenues from cigarette, beverage, and gasoline sales? A) convenience B) chain C) department D) supermarket E) hypermarket

A) convenience

70) Like retailers, wholesalers must ________ their target markets and ________ themselves effectively, for they cannot serve everyone. A) define; position B) position; define C) discount; franchise D) franchise; discount E) identify; compare

A) define; position

94) Which of the following types of retailers is most likely to practice everyday low pricing (EDLP)? A) discount stores B) convenience stores C) category killers D) full-service retailers E) department stores

A) discount stores

47) In response to a(n) ________, many retailers have cut costs, used price promotions, and added new value pitches to their positioning. A) down economy B) up economy C) dot-com meltdown D) dot-com boom E) shift in retail technology

A) down economy

91) Tony Pool Chemical Co. purchased 144 buckets of chlorine tablets over the Internet from Chemical, Inc., then placed the order with the manufacturer and arranged for its transportation by truck to the Tony Pool store. Chemical, Inc. took title to the pool chemicals but never actually took possession of them. Chemical, Inc. is an example of a ________. A) drop shipper B) truck jobber C) rack jobber D) mail-order wholesaler E) cash-and-carry wholesaler

A) drop shipper

79) In the battle for "share of stomachs," some supermarkets are cutting costs and attempting to compete more effectively with food discounters, while others are moving upscale, providing improved store environments and higher-quality food offerings. These two different strategies represent differences in ________. A) positioning B) place decisions C) retail convergence D) retail technology E) wholesaling

A) positioning

80) 7-Eleven has recently begun to redesign and restock its stores to offer a more upscale environment and products, such as house wines and fresh foods. 7-Eleven has changed its ________. A) positioning B) wholesaler C) service level D) size E) relative prices

A) positioning

34) Costco's surprise offerings of seconds, overstocks, and closeoutsoccasionally including diamondsis an example of how a retailer can differentiate itself through ________. A) product assortment B) services mix C) experiential retailing D) store atmosphere E) high-low pricing

A) product assortment

38) Press conferences, speeches, store openings, special events, newsletters, magazines, and public service activities are examples of ways retailers use ________. A) public relations B) sales promotions C) personal selling D) the wheel-of-retailing concept E) retail convergence

A) public relations

67) ________ and ________ do not take title to goods, and they perform only a few channel functions. A) Full-service wholesalers; limited-service wholesalers B) Brokers; agents C) Branches; offices D) Power centers; independent wholesalers E) Independent wholesalers; off-price retailers

B) Brokers; agents

18) ________ sell standard merchandise at lower prices by accepting lower margins and selling higher volume. A) Merchant wholesalers B) Discount stores C) Full-service retailers D) Limited-service retailers E) Factory outlets

B) Discount stores

23) ________ are sometimes several stores grouped together. These stores offer prices as low as 50 percent below retail on a wide range of mostly surplus, discounted, or irregular items. A) Category killers B) Factory outlets C) Specialty stores D) Superstores E) Power centers

B) Factory outlets

1) ________ includes all the activities involved in selling products or services directly to final consumers for their personal, nonbusiness use. A) Franchising B) Retailing C) Brokering D) Wholesaling E) Disintermediation

B) Retailing

3) ________ is the basis of all discount operations and is typically used by sellers of convenience goods. Retailers offering this level of service require customers to perform their own "locate-compare-select" process in order to save money. A) Limited-service B) Self-service C) Full-service D) Specialty-service E) Wholesaling

B) Self-service

8) ________ are flourishing due to increased use of market segmentation and market targeting. A) Chain stores B) Specialty stores C) Superstores D) Discount stores E) Off-price stores

B) Specialty stores

95) Which of the following is most likely true about shoppers who prefer to shop at "lifestyle centers"? A) They prefer inexpensive atmospheres. B) They prefer upscale stores. C) They prefer out-of-the-way locations. D) They rarely dine out. E) They are motivated by deals on last year's merchandise and seconds.

B) They prefer upscale stores.

68) A(n) ________ brings buyers and sellers together and assists in negotiations. A) agent B) broker C) retailer D) wholesaler E) retail convergence

B) broker

77) 7-Eleven, Stop-N-Go, and Circle K, small stores that traditionally have had a primary market of young, blue-collar men, are examples of ________. A) department stores B) convenience stores C) category killers D) specialty stores E) supermarkets

B) convenience stores

88) Nita can visit her local supermarket and buy a dozen roses, a gallon of milk, two birthday cards, a bag of cat litter, and a pan for roasting a turkey. This best illustrates how a wholesaler has added value through the channel function of ________. A) creating atmospherics B) creating assortments C) directing logistics D) market information E) management services

B) creating assortments

31) Service differentiation among retailers has ________. A) increased B) decreased C) stayed the same D) franchised E) tripled

B) decreased

10) Which type of store carries a wide variety of product lines and differentiates itself through service, but has been squeezed in recent years between more focused and flexible specialty stores on the one hand and more efficient, lower-priced discounters on the other? A) chain B) department C) factory outlet D) merchant wholesaler E) independents

B) department

81) Big and Tall Men's Shop carries goods in larger sizes; this allows the store to ________ other stores. A) align itself with B) differentiate itself from C) cluster with D) affect the store atmosphere of E) converge with

B) differentiate itself from

54) Retail convergence is a merging of all of the following EXCEPT ________. A) consumers B) employees C) products D) prices E) retailers

B) employees

7) Which of the following types of retailers likely requires their employees to focus most on assisting customers as they shop? A) self-service retailers B) full-service retailers C) off-price retailers D) limited-service retailers E) megaretailers

B) full-service retailers

75) In response to slow growth in their domestic markets, many wholesalers are ________. A) contracting their international business B) increasing their international business C) divesting themselves of costly technologies D) lengthening the marketing channel E) reducing elaborate promotional efforts

B) increasing their international business

78) Overstock.com, a Web seller that buys furniture, clothing, electronics, and more from a variety of producers at less-than-regular wholesale prices and then charges customers less than retail, is a(n) ________. A) discount store B) independent off-price retailer C) factory outlet D) wholesale club E) category killer

B) independent off-price retailer

72) Which type of wholesaler sells primarily to manufacturers rather than to retailers? A) wholesale merchants B) industrial distributors C) cash-and-carry wholesalers D) rack jobbers E) drop shippers

B) industrial distributors

73) Today's large, progressive wholesalers have successfully reacted to rising costs by ________. A) relocating in low-rent, low-tax areas B) investing in information technology systems C) investing less money in expensive machinery D) increasing their markup E) reducing promotional activities

B) investing in information technology systems

46) A ________ is a smaller mall with upscale stores, convenient locations, and an expensive atmosphere. It is typically located near affluent residential neighborhoods. A) regional shopping center B) lifestyle center C) community shopping center D) franchise E) power center

B) lifestyle center

9) Specialty stores carry ________ with ________ within them. A) convenience items; mostly staples B) narrow product lines; deep assortments C) narrow product lines; shallow assortments D) wide product lines; shallow assortments E) wide product lines; deep assortments

B) narrow product lines; deep assortments

29) Retail assortments are looking more and more alike because ________. A) customers today are more focused on service differentiation B) national-brand manufacturers have placed their products almost everywhere C) market segmentation has proved ineffective D) stores are clustered together to increase their customer pulling power E) more stores are practicing "experiential retailing"

B) national-brand manufacturers have placed their products almost everywhere

52) Mail-order, phone, and online shopping are all examples of ________. A) shopper marketing B) nonstore retailing C) off-price retailing D) full-service retailing E) wholesaling

B) nonstore retailing

86) Stan Clark, the owner of Eskimo Joe's bar, is considering closing the bar and selling the logo apparel with direct marketing through a catalog. Stan Clark is considering a(n) ________ option. A) wholesaling B) nonstore retailing C) shopper marketing D) experiential shopping E) self-service

B) nonstore retailing

45) Today's trend in retail clusters is toward ________, huge unenclosed shopping centers consisting of a long strip of retail stores, including at least one large, freestanding anchor store like Walmart. Each store has its own entrance with parking directly in front for shoppers who wish to visit only one store. A) shopping malls B) power centers C) superstores D) chain stores E) regional shopping centers

B) power centers

90) You own a neighborhood grocery store and would like to have non-food items delivered, priced, displayed and inventoried by a wholesaler. You do not want to purchase title to the goods. Which type of wholesaler best fits your needs? A) cash-and-carry wholesaler B) rack jobber C) drop shipper D) mail-order wholesaler E) agents and brokers

B) rack jobber

26) As a result of the great success of corporate chains, many independent stores choose to band together in either a voluntary chain or a(n) ________. A) factory outlet B) retailer cooperative C) independent off-price retailer D) warehouse club E) convenience cooperative

B) retailer cooperative

37) In-store demonstrations, displays, contests, and visiting celebrities are examples of ________. A) franchises B) sales promotions C) agent promotions D) broker promotions E) product life-cycling

B) sales promotions

60) Which wholesaler's channel function is demonstrated when a wholesaler's sales force helps a manufacturer to reach many small customers at a low cost? A) bulk-breaking B) selling and promoting C) buying and assortment building D) warehousing E) rackjobbing

B) selling and promoting

35) Home Depot offers "how-to" classes for do-it-yourselfers, featuring instructions on how to complete home improvement projects using products sold at its stores. This is an example of how Home Depot has differentiated itself through its ________. A) product assortment B) services mix C) segmentation D) atmosphere E) targeting

B) services mix

39) Why do stores cluster together? A) to decrease competition B) to increase their customer pulling power C) to take advantage of franchise agreements D) to create retailer cooperatives E) to standardize the service mix

B) to increase their customer pulling power

63) Which wholesaler's channel function is demonstrated when a buyer receives quicker delivery because wholesalers are located closer than producers? A) financing B) transportation C) buying and assortment building D) warehousing E) risk bearing

B) transportation

69) ________, or manufacturers' representatives, represent a buyer or seller on a more permanent basis. A) Brokers B) Franchises C) Agents D) Retailers E) Intermediaries

C) Agents

56) Most ________ retailers are significantly behind ________ retailers in global expansion. A) African; Peruvian B) European; American C) American; European and Asian D) Asian; American E) Asian; African

C) American; European and Asian

57) ________, the world's second largest retailer after Walmart, has embarked on an aggressive mission to extend its role as a leading international retailer. A) McDonald's B) Target C) Carrefour D) IKEA E) Costco

C) Carrefour

17) ________ retailers in the United States are growing faster than product retailers. A) Discount B) Merchant C) Service D) Specialty E) Off-price

C) Service

59) ________ buy mostly from producers and sell to retailers and industrial consumers. A) Independents B) Factory outlets C) Wholesalers D) Discount stores E) Megaretailers

C) Wholesalers

82) The lighting in Jake's Steak Restaurant is muted. The chairs are covered in leather and solid enough to last a lifetime, and each table is covered with a white linen cloth. The colors are limited to earth tones with an occasional splash of red. Patrons can not hear any kitchen noises, only a pleasant melody that seems familiar but unrecognizable. The smells are extraordinarily varied. This is a description of the restaurant's ________. A) promotions B) target C) atmosphere D) services mix E) product assortment

C) atmosphere

53) Which of the following has NOT contributed to the growth of online business? A) easier-to-use Web sites B) more interesting and attractive Web sites C) concerns about online privacy and security D) improved online service E) increasingly sophisticated search engines

C) concerns about online privacy and security

30) Until retailers ________ and ________ their markets, they cannot make consistent decisions about product assortment, services, pricing, advertising, store décor, or any of the other decisions that must support their positions. A) compete with; position B) target; compete with C) define; profile D) limit; serve E) divest; eliminate

C) define; profile

19) Early ________ cut expenses by offering few services and operating in warehouse-like facilities in low-rent, heavily traveled districts. A) chain stores B) factory outlet malls C) discount stores D) off-price retailers E) full-service retailers

C) discount stores

27) The main difference between ________ organizations and other contractual systems is that these systems are normally based on some unique product or service. A) voluntary chain B) retailer cooperative C) franchise D) agent E) warehouse-club

C) franchise

28) McDonald's, Subway, and Pizza Hut are all examples of a ________. A) voluntary chain B) retailer cooperative C) franchise D) full-service retailer E) power center

C) franchise

6) At Neiman Marcus, a first-class department store, customers shop for high-end products and have come to expect assistance in every phase of the shopping process. Neiman Marcus is a ________. A) self-service retailer B) limited-service retailer C) full-service retailer D) specialty store E) power center

C) full-service retailer

5) Which type of stores usually carry more specialty goods for which customers like to be "waited on" and have much higher operating costs, which are passed along to the customer? A) self-service stores B) category killer stores C) full-service stores D) independent stores E) specialty-service retailers

C) full-service stores

36) While all retailers would like to achieve ________ while charging ________, the two seldom happen together. A) low volume; high markups B) low volume; low markups C) high volume; high markups D) high volume; low markups E) high volume; cut-rate markups

C) high volume; high markups

84) Macy's department stores carry a wide range of product lines, including clothing, jewelry, kitchenware, and home furnishings. Macy's typically charges a relatively high markup, but also holds frequent sales and price promotions, in particular offering discounts to customers who use a Macy's credit card. Macy's uses ________. A) self-service retailing B) experiential retailing C) high-low pricing D) everyday low pricing E) retail convergence

C) high-low pricing

92) An independent hardware retail store 100 miles from the nearest city of more than 5,000 people but providing needed supplies for area ranchers would most likely buy its plumbing and electrical supplies through a ________. A) truck jobber B) commission merchant C) mail-order wholesaler D) rack jobber E) merchandise broker

C) mail-order wholesaler

55) Touch-screen kiosks, customer-loyalty cards, handheld shopping assistants, and self-scanning checkout systems are all examples of how retailers use technology to ________. A) maintain inventory costs B) send information between stores C) meet consumers' expectations D) produce more accurate forecasts E) interact with suppliers

C) meet consumers' expectations

51) The rise of huge mass merchandisers and specialty superstores, along with retail mergers and acquisitions, has created a core group of very large and very powerful ________. A) category killers B) franchises C) megaretailers D) power centers E) lifestyle centers

C) megaretailers

33) A retailer's ________ should differentiate the retailer while matching target shoppers' expectations. One strategy is to offer merchandise that no other competitor carries. A) agent B) broker C) product assortment D) environment E) distribution strategy

C) product assortment

41) A ________ is a group of retail businesses built on a site that is planned, developed, owned, and managed as a unit. A) merchant wholesaler B) franchise C) shopping center D) supermarket E) hypermarket

C) shopping center

44) Most shopping centers are ________ containing between 5 and 15 stores; they are close and convenient for consumers. A) community shopping centers B) power centers C) strip malls D) lifestyle centers E) factory outlets

C) strip malls

48) According to the ________ concept, new retailing forms often begin as low-margin, low-price, low-status operations to challenge established retailers, then become successful, and eventually take the place of the established retailers they had challenged. A) agent B) broker C) wheel-of-retailing D) warehousing E) product life cycle

C) wheel-of-retailing

83) Which of the following describes a way that Costco and Walmart are similar? A) Both are warehouse clubs. B) Both target the same affluent market. C) Both offer a similar assortment of products. D) Both use everyday low pricing. E) Both market a very limited number of generic-priced food, household, and apparel lines.

D) Both use everyday low pricing.

40) ________ were the main form of retail cluster until the 1950s. A) Department stores B) Discount stores C) Independent off-price retailers D) Central business districts E) Independent stores

D) Central business districts

22) ________, which buy at less-than-regular wholesale prices and charge consumers less than retail, are independently owned and run or are divisions of larger retail corporations. A) Discount stores B) Warehouse clubs C) Superstores D) Independent off-price retailers E) Full-service retailers

D) Independent off-price retailers

4) ________ such as Sears provide more sales assistance because they carry more shopping goods about which customers need information. Their increased operating costs result in higher prices. A) Self-service retailers B) Full-service retailers C) Off-price retailers D) Limited-service retailers E) Specialty-service retailers

D) Limited-service retailers

65) ________ are the largest group of wholesalers. The group can be divided into the two broad types of full-service and limited-service. A) Brokers B) Manufacturer sellers C) Agents D) Merchant wholesalers E) Specialty wholesalers

D) Merchant wholesalers

11) ________ are facing slow sales growth because of slower population growth, increased competition, and the rapid growth of out-of-home eating. A) Convenience stores B) Department stores C) Chain stores D) Supermarkets E) Hypermarkets

D) Supermarkets

66) In order to ________, wholesalers can propose automatic reordering systems, set up management-training and advising systems, or even sponsor a voluntary chain. A) define their target markets B) identify more profitable customers C) determine product and service assortments D) build better relationships with customers E) negotiate pricing

D) build better relationships with customers

21) Which of the following is NOT one of the main types of off-price retailers? A) independents B) factory outlets C) warehouse clubs D) category killers E) membership warehouses

D) category killers

50) Convergence means greater ________ for retailers and greater difficulty in ________ offerings. A) differentiating; pricing B) sales; differentiating C) profit margins; sales D) competition; differentiating E) branding; differentiating

D) competition; differentiating

32) A retailer may fail because it tries to provide "something for everyone" and ends up satisfying no market well. Successful retailers ________ their target markets well and position themselves strongly. A) increase B) franchise C) wholesale D) define E) position

D) define

2) In recent years, ________ has been growing fast. This includes selling to final consumers through direct mail, catalogs, telephone, and the Internet. A) social marketing B) shopper marketing C) franchising D) nonstore retailing E) e-commerce

D) nonstore retailing

61) Which of the following is NOT one of a wholesaler's channel functions? A) financing B) risk bearing C) providing market information D) off-price retailing E) bulk-breaking

D) off-price retailing

71) Which type of limited-service wholesaler is owned by farmers who assemble farm produce to sell in local markets? A) cash-and-carry wholesaler B) drop shipper C) rack jobber D) producer's cooperative E) truck jobber

D) producer's cooperative

42) A ________ contains from 40 to 200 stores, is like a covered mini-downtown, and attracts customers from a wide area. A) community shopping center B) neighborhood shopping center C) strip mall D) regional shopping center E) power center

D) regional shopping center

76) GameStop sells video games and systems, offering a narrow product line with a deep assortment within that line. GameStop is a(n) ________. A) department store B) convenience store C) category killer D) specialty store E) off-price retailer

D) specialty store

64) Which of the following is NOT one of the major classifications of wholesalers? A) merchant wholesalers B) agents C) manufacturers' sales branches and offices D) specialty wholesalers E) brokers

D) specialty wholesalers

12) Which type of retailer tends to be the most frequently shopped? A) convenience stores B) department stores C) superstores D) supermarkets E) off-price retailers

D) supermarkets

14) Which type of store is much larger than regular supermarkets and offers a large assortment of routinely purchased food products, nonfood items, and services? A) category killer B) chain C) factory outlet D) superstore E) off-price

D) superstore

85) The Home Depot entered the market as a store for professional and amateur plumbers, electricians, and carpenters. Then it introduced its garden centers. Next came its home design center that provides help with all kinds of interior decorating problems. Now it is enlarging its garden centers and hiring knowledgeable gardeners to staff these centers. The addition of more amenities and greater assortment can be best explained by which of the following? A) the interconnectedness of the retail life cycle B) the trend toward disintermediation C) the success of off-price retailers D) the wheel-of-retailing hypothesis E) the 80/20 rule of retailing

D) the wheel-of-retailing hypothesis

62) Which wholesaler's channel function is demonstrated when a wholesaler reduces inventory holding costs and risks to suppliers and customers? A) financing B) transporting C) buying and assortment building D) warehousing E) bulk breaking

D) warehousing

16) Service retailers include all of the following EXCEPT ________. A) hotels and motels B) airlines C) movie theaters D) bowling alleys E) convenience stores

E) convenience stores

74) Savvy wholesalers realize that their only reason for existence comes from increasing the efficiency and effectiveness of the ________. A) retailer B) industry C) distribution system D) end customer E) entire marketing channel

E) entire marketing channel

87) Carey David's wholesale company helps retailers train salesclerks, improve store layouts and displays, and set up inventory control systems. The channel function Cary David provides is ________. A) buying and assortment building B) selling and promotion services C) risk bearing services D) marketing information E) management services and advice

E) management services and advice

93) SuperValu, traditionally classified as a food wholesaler, has recently started or acquired several retail food chains of its own, including Albertsons, Jewel-Osco, and Cub Foods. Which of the following trends is this an example of? A) movement toward self-service retailing B) the growing domination of superstores C) the decline of the voluntary chain D) retail convergence E) the blurring of distinctions between retailers and wholesalers

E) the blurring of distinctions between retailers and wholesalers