Review 4.3

One reason why small entrepreneurs can compete successfully with large retailers is because large retail chains carry more than one product line.

False

To retain customers, you will need to occasionally ask them for their opinions about your business and respond to their feedback.

False

Your indirect competition are those businesses that make most of their money selling products or services that are the same as or similar to yours.

False

A competitor's strengths should be viewed as threats to your business.

True

Businesses typically enter into areas where there is competition.

True

Secondary data resources and observation methods can help you learn about your direct competition.

True

Superior service and frequent-buyer programs are strategies you can use to maintain customer loyalty.

True

Your analysis of competitors should include their prices, locations, and facilities.

True

Which of the following would be considered an indirect competitor of McDonald's?

a. Kentucky Fried Chicken b. Pizza Hut c. Subway d. all of these CORRECT

As an entrepreneur, you may find that indirect competitors

a. are more difficult to locate than direct competitors. CORRECT b. are usually located in malls or shopping centers. c. make most of their money selling the same or similar products or services that you sell. d. none of these

Small businesses may have difficulty competing with large retailers because large retailers

a. develop more complete customer profiles. b. have a larger target market. c. are able to keep larger quantities of products in stock. CORRECT d. offer superior service.

All of the following are strategies designed to maintain customer loyalty except

a. having more convenient hours than other businesses. b. locating in a city center. CORRECT c. having easy return policies. d. providing store-specific credit cards.

A competitive analysis does all of the following except

a. identify competitors. b. research a competitor's business plan. CORRECT c. identify threats from a competitor. d. summarize the products and prices offered by competitors.

The main purpose of customer loyalty strategies is to

a. obtain new customers. b. keep customers happy so that they return to the business. CORRECT c. save money. d. none of these

Competitors should be analyzed concerning their

a. prices. b. locations. c. strengths and weaknesses. d. all of these CORRECT

All of the following can provide information about direct competition except

a. the Internet. b. the U.S. Postal Service. CORRECT c. observation methods. d. your local chamber of commerce.