Merchandise and Inventory-Sales and Selling

Destination areas are positioned to take advantage of high-traffic corridors. (t/f)

true

If an item sells at the targeted markup, markup percentage and gross margin percentage will be the same. (t/f)

true

Markdown sales could be considered promotional events. (t/f)

true

The floor layout design of sales-oriented planogram will provide direct access to the point of sale area from the high-value destination areas within the retail environment. (t/f)

true

A presentation of the same color of golf shirts ranging in intensity from the palest to the deepest shade is employing the monochromatic color scheme. (t/f)

true- monochromatic color scheme consists of one color from deepest shade to palest.

According to the merchandising and inventory management course, every sign in a golf shop should be displayed in a sign holder. (t/f)

true-every sign should be displayed in a sign holder

What should be emphasized to close the sale?

up selling-create multiple purchases...remind customer of the value-added services and benefits

A golf shop has allocated 13% of its $325,000 retail sales forecast to woods. Based on a 70% COGS, what was the estimated cost of the woods?

0.13 x 325,000 = 42,250 x .7 = $29,575

What is the percent mark-up if the cost of an item is $75 and it sells for $120?

120-75= 45/75=0.6 60%

A discount of 20% was taken on a $15 event cap due to a logo placement error. What is the actual markup percentage if the cost of each cap was $8?

15(.2)=3 15-3= 12 8(0.5)=4 8+4=12 50%

What is the price of a driver when it costs the shop $160 and the mark-up is 80%?

160 x 0.8 = 128 + 160 = $288

If a shirt costs $30 and the mark-up percentage for the shirt is 50%, what would be the potential gross margin return on investment?

30 x .5 = 15 + 30 = 45 - 30 = $15

If the planned mark-up is 15%, what would be the price of a shirt that costs the shop $30 if the Mill River Plan is used?

30 x 0.15 = 4.50 + 30 = $34.50

Using the cost plus mark-up approach, what was the markup rate of a shirt that cost the shop $20 and is selling for $37.50?

37.50 - 20 = 17.50/20= 0.875 87.5%

A retail manager uses a cost plus 75% pricing strategy in its shoe department. The manager is planning a 25%-off retail promotional sale for a new model of golf shoe. If the shoe costs the shop $80, what will the promotional price be?

80 x .75 = 60 + 80 = 140(.25)= 35 140-35 = $105

A vendor gives a 30% discount on the cost of a shirt style that did not sell. What retail price will the shop manager assign to the shirt if the original cost from the vendor was $45 and his pricing strategy is to keystone and add $5?

90 x 0.30 = 27 90-27=63 +5 = $68

What is the most important consideration when allocating floor space?

allocating prime areas to high-selling products

What is the suggested distance for separating floor fixtures?

at least 3 feet of space to avoid accessibility issues and the appearance of clutter

What is the value of establishing "destination areas" in your golf shop?

browse other departments on the way to their destination

What is an example of a value-added strategy to stimulate sales?

club fitting or repairs, or products that customers generally intend to purchase before they enter the store

What kind of color scheme consists of two colors opposite each other on the color wheel?

complementary colors

Competitive pricing means charging the same as your competitors. (t/f)

false

Fluorescent lamps will provide the best accent lighting in a golf shop. (t/f)

false

Conventional floor fixtures include such items as cabinets and armoires. (t/f)

false- commonly used floor fixtures are four-ways, promotional tables, rounders, rectangular racks, tables, bins

The T-fixture is designed to show large quantities of hanging merchandise in a single style. (t/f)

false- rectangular racks are useful for displaying large quantities of hanging merchandise in a wide variety of colors and sizes

Wall fixtures offer the least display flexibility. (t/f)

false- when properly arranged, wall units can used to display and hold both hard goods and soft goods in exciting, colorful, and innovative ways that attract customers and drive sales

The rectangular rack is designed to show large quantities of hanging merchandise in a single style. (t/f)

false- wide variety of colors and sizes

An analogous color scheme consists of two sets of complementary colors. (t/f)

false-analogous color scheme are adjacent to each other on the wheel (like blue, blue-green, and blue-violet) are harmonious and tend to reinforce each other

End of month Inventory (EOMI) minus COGS equals Gross Margin. (t/f)

false: final retail sales price - cost of goods sold = gross margin in dollars

Given the following information, what is the gross margin in dollars? BOMI $2700 Sales $20,000 COGS $16,000 EOMI $24,500

final retail sales price (20,000)- cost of goods sold (16,000) = $4,000

Describe the primary purpose of a promotional table.

ideal for large quantities of markdown merchandise or special promotions. A single style is generally displayed per table

What is the main value of having annual special promotions?

increase value, internal marketing, customer loyalty

Using a keystone pricing strategy, what is the retail price of a shirt that has a cost of $30?

keystone pricing = doubling the item's cost 100%... $60

What is the recommended standard for displaying hanging merchandise?

left to right, grouped by color then size, face inward, smaller to large

What planning document outlines merchandising objectives for events scheduled throughout the year?

master calendar

What color scheme is being used when golf shirts have been arranged in a light to dark display?

monochromatic color scheme

Which is a reason, cited in the merchandising and inventory management course manual, for a golf shop to have annual or special promotional events?

more revenue, excitement, to increase interest and customer base

What color scheme is represented by a four-way display consisting of white, black, and gray pants?

neutral color scheme

What is the best course of action for USA flag caps that remain in stock on July 10th?

promotion/ markdowns

Which type of fixture gives the most presentation flexibility when floor space is extremely limited?

rectangular racks

What is the primary purpose of a rectangular display rack?

rectangular racks are useful for displaying large quantities of hanging merchandise in a wide variety of colors and sizes

What is the definition of a permanent markdown?

reductions in a product's list price, and are usually indicated on the merchandise tags

What is the recommended standard for displaying folded shirts?

smallest sizes on top, stacked by color and style, should be pulled to the front of the shelf

What advertising method is considered internal marketing?

staff members related marketing

What is the definition of mark-up?

the difference between wholesale price of an item and intended sales price

Cost of goods sold plus gross margin equals final retail sales price (t/f)

true