Deck 9: The Location Plan

Question 1

Customer accessibility is important in locating an electrical contracting firm.

Answer 1

False

Question 2

The site location is more important for a painting contractor than for a dress shop.

Answer 2

False

Question 3

Manufacturers are one type of business that must be located conveniently for customers.

Answer 3

False

Question 4

Sometimes an attorney can insert special clauses into a lease agreement that will allow the lessee to exit the agreement under certain circumstances.

Question 5

States establish enterprise zones in order to locate businesses where they can take advantage of the services of other businesses located in the same general area.

Question 6

In selecting a location, retailers are not all that concerned about customer accessibility.

Question 7

All other factors being equal, retail and services businesses will find little advantage in selecting a location near the center of the market.

Question 8

For many entrepreneurs, choosing a location for a small business is a one-time decision-made only when the business is first established or purchased.

Question 9

If the cost of shipping the finished product is high, the factory should probably be located near a source of raw materials.

Question 10

When criteria are evaluated in selecting the location for a new business, one factor may be more important in a given situation, but each factor always has an influence.

Question 11

Startups in any location will still get off the ground, but long-term performance of the business may be weakened if the location is a poor one.

Question 12

Unfortunately, choosing a hometown location for personal reasons is illogical.

Question 13

Customer accessibility is vital in industries in which the cost of shipping the final product is high relative to the product's value.

Question 14

From a practical business standpoint, choosing to locate a business in one's home community offers no advantages.

Question 15

The critical factor in locating factories is customer accessibility and convenience.

Question 16

Manufacturing equipment can be categorized as general-purpose and special-purpose.

Question 17

A building's functional attributes determine its suitability for the operation of a business.

Question 18

Recent observations have shown that most businesses are started in a new building.

Question 19

The primary factor in determining the location for a sawmill would probably be proximity to the market.

Question 20

Many entrepreneurs recognize the value of talking to local realtors to determine site availability and appropriateness.

Question 21

Juggling the needs of business clients and family members can be so stressful that the home business must be relocated.

Question 22

A brick-and-mortar store is actually a general term that refers to any retail outlet dealing in building supplies.

Question 23

It is possible for an entrepreneur to do business over the Internet without either a Web site or storefront.

Question 24

One of the advantages B2C businesses have over traditional retailers is that they can quickly change product mixes and prices, as well as the appearance of the store (that is, the Web site).

Question 25

E-commerce can provide a benefit to small firms by compressing the sales cycle and easing cash flow difficulties.

Question 26

B2B success stories generally receive more publicity than B2C ventures.

Question 27

If they are based in the owner's home, a business must conform to local zoning ordinances.

Question 28

Most of the time, customers go to a brick-and-mortar store with the intent of shopping or purchasing.

Question 29

All B2B firms are fairly much alike.

Question 30

To maximize sales and profits, a discount shoe store should create an atmosphere similar to that of better department stores, with thick carpets, indirect lighting, and big easy chairs.

Question 31

One of the ways that the Internet has impacted small firms is by bringing new life and technology to the management of customer service.

Question 32

Small retailers need merchandise display racks and other equipment, but these are usually less expensive than that which is required for a factory operation.

Question 33

A milking machine in a dairy is a type of general-purpose equipment.

Question 34

B2C startups offer only one main advantage over brick-and-mortar retailing-transaction speed.

Question 35

The technical nature of the Internet makes e-commerce too expensive for small firms.

Question 36

Recent business-application technologies that enable home-based businesses to compete are also contributing to an increase in the number of these firms.

Question 37

Bottling machines and auto assembly line machinery are examples of general-purpose equipment.

Question 38

E-commerce is really nothing more than a new way of taking orders, supplementing the capabilities of the phone or fax machine.

Question 39

Because of its complexity, modern technology has had no noticeable effect in expanding the number of home-based businesses.

Question 40

The role of a Web site can range from merely offering content and information to enabling complex business transactions.

Question 41

Roger Hemingway is analyzing regional differences in seeking a location for a new firm. He just read a Wall Street Journal article that ranked states according to the favorability of tax laws. Based on this information, he has decided to give further attention to one of the best states, which is

A) Wyoming.
B) Massachusetts.
C) Ohio.
D) New York.

Question 42

Personal reasons for choosing one's hometown as a location for a new business venture include the fact that

A) the entrepreneur knows the landmarks around his or her home community.
B) credit can be established more easily.
C) friends and relatives line up new customers.
D) this reduces the risk of operations.

Question 43

Basic considerations that enter into the selection of a location for a manufacturing business normally include

A) availability of raw materials.
B) customer accessibility.
C) neighborhood conditions.
D) federal income taxes.

Question 44

A good reason for relocating a typical manufacturing business is to

A) stabilize income taxes.
B) increase customer traffic.
C) get closer to raw materials.
D) provide free-flow space.

Question 45

If a brand's product, such as a snack food, is not located close enough to the target customer, the customer will most likely be inconvenienced by traveling further to get the product.

Question 46

Facilities that rent space only to new businesses and that provide services for them are called

A) industrial parks.
B) community development centers.
C) shopping centers.
D) business incubators.

Question 47

Which of the following is not a potential advantage of establishing a small business in one's home community?

A) Appreciation of the atmosphere of the community
B) More extensive knowledge of consumer tastes
C) Greater ability to establish favorable credit arrangements
D) Increased stability of operations

Question 48

Which of the following is a true statement about location decisions?

A) Franchisers never assist entrepreneurs with location decisions.
B) Location decisions have an enduring effect on business operations.
C) Location decisions should be made independently of consumer needs.
D) The location decision is equally critical to all types of businesses.

Question 49

Customer accessibility is the most critical factor in evaluating a specific site for a

A) clothing manufacturer.
B) drugstore.
C) plumber.
D) software development company.

Question 50

When selecting a good location for a business the personal preference of the entrepreneur is important, as it will determine their success.

Question 51

A new business might best begin

A) in a foreign country.
B) in a business incubator.
C) in the classroom setting.
D) at the start of a tax year.

Question 52

For small service or retail businesses, the top priority in location decisions is

A) personal preference.
B) resource availability.
C) customer accessibility.
D) environmental conditions.

Question 53

Enterprise zones are sponsored by local city or county governments; they offer new businesses exemption from property taxes on plant and equipment for the lifetime of the plant

Question 54

For manufacturers, which of the following is a top priority in location decisions?

A) Personal preference
B) Environmental conditions
C) Closeness to raw materials
D) Customer accessibility

Question 55

Site-related factors that should be taken into consideration when one is selecting a retail location include

A) future advertising costs.
B) the labor supply.
C) raw material availability.
D) customer accessibility.

Question 56

The primary advantage an entrepreneur gains by leasing rather than buying facilities is

A) receipt of an investment tax credit.
B) a decrease in investment risk.
C) a decrease in the amount of promotion required.
D) a customized layout.

Question 57

For many new firms, the most important reason to lease rather than buy a facility is

A) avoidance of a large cash outlay.
B) freedom in modifying the building.
C) avoidance of interest payments.
D) avoidance of liability lawsuits.

Question 58

In a location decision, the raw materials availability factor is particularly important for a

A) CPA.
B) manufacturer.
C) management consultant.
D) venture capitalist.

Question 59

One of the greatest contributions that incubator facilities provide to small businesses include

A) shared manufacturing space.
B) postal services.
C) management assistance.
D) university sponsorship.

Question 60

One of the extensions of the brick-and-mortar store is the contact-and-mortar strategy.

Question 61

Using special-purpose equipment in the manufacturing process typically results in

A) increased operator errors.
B) higher costs of processing.
C) a rise in accident rates.
D) greater output per machine-hour of operation.

Question 62

The heart of Electronic Customer Relationship Marketing is a

A) focus on customization.
B) conscientious work force.
C) flexible distribution system.
D) consumer-centric data warehouse.

Question 63

The Internet has brought new life and technology to the old-fashioned notion of

A) customer service.
B) the "push sell".
C) the firm's production orientation.
D) strategic management.

Question 64

In the B2B model, the customers can best be described as

A) businesses.
B) consumers.
C) franchisees.
D) auction participants.

Question 65

The functional requirements of a business should determine the

A) geographic location of the business.
B) suitability of a building.
C) labor requirements.
D) spatial requirements.

Question 66

E-commerce refers to

A) B2B models of doing business.
B) the facilitation of business by making initial contact by electronic means.
C) the paperless exchange of business information via the Internet.
D) a form of business that involves online trades and auctions.

Question 67

An example of special-purpose equipment is a

A) lathe.
B) bottling machine.
C) drill press.
D) ripsaw.

Question 68

Harry Hardwick is starting a job-order machine shop and is buying such used equipment as lathes, planing mills, and drill presses. The equipment he plans to use is

A) special-purpose equipment.
B) automated equipment.
C) general-purpose equipment.
D) product-layout equipment.

Question 69

The Internet provides an alternative to

A) bricks-and-mortar stores.
B) clicks-and-mortar strategies.
C) B2B businesses.
D) B2C businesses.

Question 70

A group of shared characteristics, behaviors, and goals that a firm follows in a particular business situation is known as a

A) business model.
B) strategic plan.
C) firm strategy.
D) business profile.

Question 71

For small businesses, the Internet tends to blur ____ boundaries.

A) industry
B) geographic
C) skill-dependent
D) technological

Question 72

Why does electronic commerce benefit small firms?

A) Small firms are often "tech savvy", which allows them to embrace innovations more quickly.
B) Large firms have complex business plans that fail to direct investment toward the Internet.
C) Without e-commerce, small firms often lack the resources to expand beyond local markets.
D) The government has committed significant resources to encourage small firms to go online.

Question 73

A home-based business is one located in

A) a local area of family-occupied houses.
B) the city of the business owner.
C) the city recognized as the industry home, where similar businesses are located.
D) the owner's personal residence.

Question 74

The traditional physical store is sometimes referred to as the ____ store.

A) classic commerce
B) real experience
C) tangible alternative
D) bricks-and-mortar

Question 75

Helen Artz is planning to open a high-fashion clothing store for young professional women. She knows that the fixtures she acquires for the store should be

A) economical.
B) elegant.
C) practical.
D) feminine.

Question 76

Dell Computer Corporation deals directly with corporate customers online and builds computers to specifications after an order is placed, which reduces the firm's storage and carrying costs. This illustrates that B2B firms can create

A) greater efficiency in their selling.
B) greater efficiency it their buying.
C) synergies between buying and selling.
D) market reach through e-commerce.

Question 77

Which of the following is not one of the major categories of e-commerce businesses?

A) Consumer-to-business
B) Business-to-consumer
C) Business-to-business
D) Auction sites

Question 78

John Pearson created Acme Online to allow paper suppliers to compete for manufacturers' orders over the Internet in live auctions. This model would best be described as

A) consumer-to-business.
B) business-to-consumer.
C) business-to-business.
D) consumer-to-consumer.

Question 79

Businesses that operate in the home

A) can increase profits by decreasing costs.
B) require customer traffic.
C) are called family businesses.
D) are less common today than they were 10 years ago.

Question 80

Special-purpose equipment is generally difficult for small manufacturers to use unless

A) the plant has mostly short production runs.
B) the plant produces a standardized product in a large enough volume.
C) the plant is set up in a process layout.
D) the plant can be used for multiple purposes.