Chapter 11 | Retailing and Wholesaling

narrow product lines with deep assortments

Specialty stores are characterized by ________.

the blurring of distinctions between retailers and wholesalers

JP Wholesalers is one of the largest wholesalers of wooden furnishings in the country. Recently, the company opened a chain of stores called JP Designer Homes that has become popular due to the good reputation the company has as a wholesaler. The company has now started acquiring smaller retail chains and consolidating its position in the market. Which of the following trends is reflected in this scenario? A) the shift toward self-service retailing B) the decline of superstores and megastores C) the decline of the voluntary chain distribution method D) the rise of franchise organizations and joint partnerships E) the blurring of distinctions between retailers and wholesalers

Jacob represents his company but is not liable for any damaged or low-quality goods.

Jacob Kendler works in a wholesale business which specializes in industrial goods needed in automobile industries. Jacob's job involves locating and contacting potential buyers and sellers and facilitating the negotiation process. Which of the following, if true, would strengthen the argument that Jacob works as an agent and not as a merchant wholesaler? A) Jacob runs an independently-owned business. B) Jacob is an employee of an organization producing automobiles. C) Jacob represents his company but is not liable for any damaged or low-quality goods. D) Jacob works in a highly specialized market and does not venture into other product categories. E) Jacob provides a full set of services ranging from locating sellers to delivering goods.

Services like hotels, banks, airlines, restaurants, colleges, and hospitals can be retailed.

17) Which of the following statements is true of retailing? A) All retail stores are full-service retail stores. B) A department store has a narrow product line with a deep assortment. C) The largest type of retail outlet is a supermarket. D) Services like hotels, banks, airlines, restaurants, colleges, and hospitals can be retailed. E) A feature common to all types of retail stores is the use of the everyday low pricing strategy.

broker

A ________ brings buyers and sellers together and assists in negotiations.

community shopping center

A ________ contains between 15 and 50 retail stores, including a department or variety store, a supermarket, specialty stores, professional offices, and sometimes a bank.

lifestyle center

A ________ is a small open-air mall with upscale stores, convenient locations, and nonretail activities such as a playground, dining establishments, and a movie theater.

shopping center

A ________ refers to a group of retail businesses built on a site that is planned, developed, owned, and managed as a unit.

carries a limited line of high-turnover goods for consumer self-service

A convenience store ________. A) markets to segments comprised mostly of white-collar workers B) stocks narrow product lines that have wide, deep assortments C) carries a limited line of high-turnover goods for consumer self-service D) involves high operation costs due to full-service customer assistance E) is a multi-channel food and discount retailer that targets niche markets

investing in information technology systems

According to the text, today's large and progressive wholesalers have successfully reacted to rising costs by ________. A) relocating to low-rent, low-tax areas B) investing in information technology systems C) eliminating the need for brokers and agents D) increasing customer service responsibilities E) reducing promotional and personal selling activities

independent off-price retailer

Allstocks.com is an online retailer that buys furniture, clothing, electronics, and more from a variety of producers at less-than-regular wholesale prices. Allstocks then charges customers less than retail. Allstocks is an example of a(n) ________.

factory outlet

An off-price retailing operation that is owned and operated by a manufacturer and normally carries the manufacturer's surplus, discontinued, or irregular goods is called a ________.

offer numerous sales or discounts

Barry's is a chain of retail stores that stocks a large variety of goods and practices high-low pricing. This means that Barry's is likely to ________.

manufacturers' offices

C & G Retail, a chain of local supermarkets, procures all its goods directly from the producers' factories. This type of wholesaling is usually done in ________.

Posco better utilizes the services mix to differentiate itself from Campbell

Campbell is one of the oldest retailers in the country. While the service offered at Campbell is fairly mediocre, the retailer is famous for its surprise offerings of seconds, overstocks, and closeouts-occasionally including expensive gadgets and jewelry. Posco, a new chain of retail stores, offers products that are similar to Campbell's offerings; however, Posco is known for encouraging customers to ask questions and for providing service representatives to assist customers in the purchasing decision process. From this scenario, which of the following statements is most likely true? A) Posco fails to differentiate itself from Campbell through the services mix. B) Posco's product assortment helps differentiate it from Campbell. C) Both Campbell and Posco fail to identify the needs and wants of target markets. D) Campbell has not been able to differentiate itself on the basis of product assortment. E) Posco better utilizes the services mix to differentiate itself from Campbell.

pop-up stores

Carleese, a leading fashion brand, sets up small temporary boutiques across numerous locations during its year-end sale, promoting its outdated products at half the price. These temporary boutiques are referred to as ________.

showrooming

Checking out products in traditional stores and purchasing them online is referred to as ________.

full-service retailer

Customers at Carat, a premium jewelry store, are encouraged to make an appointment before a visit so that a customer service representative is assigned to them. These representatives help every customer make a purchase that meets his or her needs and budget after considering numerous options. The different styles and special features of the jewelry are explained to each customer to aid the purchase decision. In this case, Carat is an example of a(n) ________.

wide varieties of product lines

Department stores are most likely characterized by ________.

factory outlet

Dina loves branded apparel and accessories but cannot afford to buy them too often. Fortunately, Dina lives close to an off-price retail store that is owned and operated by a famous brand. The company utilizes this store to sell its surplus, discontinued, or irregular goods at significantly lower costs. The retail store is best referred to as a ________.

full-service retailer

Flax is a chain of stores that carries several product lines including clothing, home furnishings, and household appliances. Each line is operated as a separate department, and employees are available to assist and advise customers in every phase of the shopping process. Flax is most likely a ________.

constituted by national brands on which the store holds exclusive rights

For a retailer to be able to differentiate from competitors and match target shoppers' expectations, the retailer's product assortment should most likely be ________. A) identical to the product assortment offered by competitors B) devoid of any blockbuster goods since they distract most consumers C) targeted at all consumers in the global market irrespective of local needs D) constituted by national brands on which the store holds exclusive rights E) devoid of any seconds, overstocks, and closeouts that damage the retailer's image

specialty store

GameStop, a video game retailer, offers a deep assortment of video games and video game consoles. GameStop is best described as a(n) ________.

merchant wholesaler

Hamilton Wholesaling, an electronics wholesaling firm, provides many services to customers including buying, storing, and transporting expensive and delicate electronics equipment. Hamilton takes title of ownership to all goods that the firm handles. Hamilton is most likely a(n) ________.

department store

Jones & Company, a major retail chain across the United States, offers a wide range of consumer goods such as clothing, furniture, home appliances, cosmetics, jewelry, and food. Jones & Company is best described as a ________.

franchise organization

McPherson's, an ice cream retailer, recently entered into an agreement that allows independent businesspeople at select stores and locations across the country to sell its famous ice creams and milk shakes for a monetary consideration. Which type of contractual retail association is described in the above example?

category killer

Pawz is a larger retailer that specializes in pet products and services such as pet food, accessories, grooming, toys, and medical treatment. Pawz also has animals available for adoption at all of its many stores located across the nation. Pawz is most likely an example of a ________.

provision of individual entrances to each store

Power centers are characterized by the ________. A) lack of an anchor store B) sale of exclusive brands only C) provision of individual entrances to each store D) provision for nonretail activities, such as playgrounds E) absence of any pricing strategies for differentiation

reduced differentiation

Retail convergence most likely leads to ________.

franchise

Rhonda recently entered into a contractual agreement with StellarCutz, a national chain of affordable, walk-in hair salons. Under the agreement, Rhonda uses the StellarCutz trade name and receives support from StellarCutz in terms of business methods and processes. Rhonda paid a start-up fee to StellarCutz and will pay annual licensing fees for the use of the StellarCutz brand. Which of the following best describes Rhonda's business?

limited-service

Stores that provide moderate sales assistance because they carry shopping goods about which customers need a moderate level of information are called ________ retailers.

high-low pricing

The Toby's chain of first-class department stores carries a wide range of product lines, including clothing, jewelry, kitchenware, and home furnishings. Toby's typically charge higher prices on an everyday basis and then holds frequent sales and price promotions to increase store traffic. Toby's most likely uses ________.

experiential retailing

Venture Zone, a hiking and climbing equipment retailer, has a rock climbing wall inside the store so that consumers can test products prior to purchase. Venture Zone most likely differentiates itself from its competitors through ________.

management services and advice

Wayne Wholesaling fulfills many channel functions for its customers. The company mainly focuses on helping retailers to train their salespeople, improve store layouts, and set up inventory control systems. Based on this description, which channel function is provided by Wayne Wholesaling? A) buying and assortment building B) selling and promoting C) risk bearing services D) market information services E) management services and advice

segmentation

What is most likely the first major marketing decision that a retailer must take?

do not take title to goods

When compared to merchant wholesalers, brokers and agents ________. A) perform greater functions B) do not take title to goods C) deal only in services and not products D) do not engage in any negotiation of wholesale deals E) rarely specialize in one product category or customer type

franchise

Which contractual system is distinguished by the fact that it is normally based on some unique product or service? A) voluntary chain B) retailer cooperative C) franchise D) corporate chain E) warehouse club

transportation

Which of the following channel functions of wholesalers is demonstrated when a buyer receives quicker delivery because wholesalers are located closer than are producers? A) buying and assortment building B) financing C) transportation D) risk bearing E) warehousing

when customers are willing to conduct their own locate-compare-select process

Which of the following conditions increases the chances of a retailer opting to be categorized as a self-service retailer? A) when consumers need warranty information about shopping goods B) when customers are willing to conduct their own locate-compare-select process C) when the store offers luxury products at highly affordable prices D) when customers are looking for a narrow product line with a deep assortment E) when the store has been converted into a designer shop from a department store

warehouse club

Which of the following is a type of off-price retailer? A) specialty store B) full-service retailer C) discount store D) warehouse club E) supermarket

tighter consumer spending patterns

Which of the following is an impact of the Great Recession on retailing trends? A) economic shift toward higher prices B) lower costs for retailers C) tighter consumer spending patterns D) longer retail life cycles E) prohibition on new retail forms

The demand for lower prices and higher quality has increased.

Which of the following is true about trends in wholesaling? A) New laws prevent wholesalers from having their own retailing operations. B) Value-added customer relationships have been replaced by control systems. C) Merchant wholesalers are decreasing in number and relevance. D) The demand for lower prices and higher quality has increased. E) Bulk breaking is increasingly popular and necessary.

Shopping centers are groups of retail businesses built on a site that is planned, developed, owned, and managed as a unit.

Which of the following statements is true of shopping centers? A) Most shopping centers function at the regional level rather than at the neighborhood level. B) Shopping centers typically contain only those stores that target a niche market segment of high income groups. C) Shopping centers are groups of retail businesses built on a site that is planned, developed, owned, and managed as a unit. D) Shopping centers usually contain exclusive brands and specialty stores rather than convenience stores or department stores. E) Shopping centers are huge superstores that offer a deep assortment of a particular product line.

category killer

Which term refers to a giant specialty store with a very deep assortment of a particular product line?

voluntary chain

Which term refers to a wholesaler-sponsored group of independent retailers that engages in group buying and common merchandising? A) factory outlet mall B) retailer cooperative C) corporate chain D) warehouse club E) voluntary chain

specialty stores

Which type of retailer typically carries deep product assortments of narrow product lines?

superstores

Which type of store is much larger than a regular supermarket and offers a large assortment of routinely purchased food products, nonfood items, and services?

full-service stores

Which types of stores are characterized by specialty goods for which customers need assistance and higher operating costs that are passed along to customers as higher prices?

warehousing

Which wholesaler channel function helps reduce the inventory holding costs and risks of suppliers and customers?

selling and promoting

Which wholesaler channel function is demonstrated when a wholesaler's sales force helps a manufacturer reach many small customers at a low cost?

adding service charges to small purchase orders

Wholesalers most likely discourage less-profitable customers by ________. A) increasing product promotions B) carrying exclusive product lines C) overseeing inventory control systems D) adding service charges to small purchase orders E) requiring smaller orders to lower transportation costs

Warehouse clubs

________ are off-price retailers that operate in huge facilities offering few frills but ultra-low prices and surprise deals on selected branded merchandise.

Merchant wholesalers

________ are the largest group of wholesalers and can be divided into two broad types of wholesalers: full-service and limited-service.

Off-price retailers

________ have filled the ultralow-price, high-volume gap by buying at less-than-regular wholesale prices and charging consumers less than retail.

Wholesaling

________ includes all the activities involved in selling goods and services to those buying them for resale or business use.

Discount stores

________ refer to retailers that sell standard merchandise at lower prices by accepting lower margins and selling higher volume.

Corporate chains

________ refer to two or more outlets that are commonly owned and controlled.

Retailing

________ refers to the activities involved in selling products or services directly to final consumers for their personal, nonbusiness use.

Shopper marketing

________ refers to using point-of-purchase promotions and advertising to extend brand equity to "the last mile" and encourage favorable point-of-purchase decisions.

Retailers

________ represent buyers or sellers on a more permanent basis than brokers.