Deck 13: Small Business Marketing: Place

Question 1

Cities that provide stable housing markets and low crime rates also see the strongest economic growth.

Answer 1

True

Question 2

An intermediary who sells products to the ultimate consumer is referred to as a broker.

Answer 2

False

Question 3

A disadvantage of locating in a central business district is that it is expensive and hard to obtain parking.

Answer 3

True

Question 4

Selecting a location for a business is one of the most important decisions made by a small business owner.

Question 5

Anchor stores are small retail shops located within large department stores that draw people to the store.

Question 6

Figure 13.2 shows that choosing the right location for a business is a process of expanding the region, beginning with neighborhood, then city, then state, and finally region.

Question 7

Neighborhoods tend to have residents that are very different.

Question 8

It is possible to eliminate the middleman intermediaries and the functions they perform.

Question 9

Neither brokers nor agents take title, or ownership, to the goods sold.

Question 10

People will go out of their way to find a business.

Question 11

The economic condition of a city, state, or region can be much different than the national economic condition.

Question 12

The type of traffic passing a business is just as important as the volume of traffic that is passing the business.

Question 13

Adding intermediaries to the distribution channel usually increases the cost to the consumer.

Question 14

T F For service businesses that visit the customer (like plumbers and landscapers), location becomes even more critical than for other service businesses.

Question 15

Since the SCI is difficult to calculate, business consultants must be hired to figure the index and interpret the data.

Question 16

If a small business owner chooses a stand-alone location, the competitive advantage of the business must be very clear.

Question 17

The choice for distribution channel becomes less significant when entering international markets.

Question 18

Intermediaries include agents, brokers, wholesalers, and retailers.

Question 19

The volume of automobile and foot traffic, the speed of vehicles, and the presence of turning lanes and parking areas are important factors to consider when choosing a location for a business.

Question 20

A disadvantage of locating a business in a shopping center is the inflexibility of the hours that the business must be open.

Question 21

Sandra visits the local farmer's market every Friday during the summer, where she picks up fresh produce that was grown by the same farmers who are there to sell the goods. The farmer's market where Sandra likes to shop illustrates what type of distribution channel?

A) Direct
B) Closed system
C) Indirect
D) Non-linear

Question 22

In a process layout, the product stays in one spot, and equipment, materials, and labor are brought to the product.

Question 23

Of the Four Ps of the marketing, _________ is especially significant for business because an effective distribution system can make or save a small business.

A) Product
B) Place
C) Price
D) Promotion

Question 24

The Americans with Disabilities Act (ADA) of 1990 requires businesses to be accessible to disabled customers and employees.

Question 25

The biggest advantage of leasing is the property tax that the lessee does not have to pay.

Question 26

Before a site is selected, a business owner must first lay out the interior of the business.

Question 27

An incubator offers support services and equipment, professional assistance, and networking to new small businesses.

Question 28

The use of two or more channels to distribute the same product to the same target market is referred to as

A) Direct channel distribution
B) Indirect channel distribution
C) Multi-purpose distribution
D) Dual distribution

Question 29

A product layout is inflexible because it is costly and difficult to change the product that is being made.

Question 30

The series of intermediaries a product passes through when going from producer to supplier is known as

A) Direct channels
B) Distribution channels
C) Warehousing
D) Shelf life

Question 31

Lease payments are deductible business expenses, while if a building is owned, only depreciation is deductible for tax purposes.

Question 32

The recognition clause in a lease allows landlords to adjust rent according to the Consumer Price Index or some other economic scale.

Question 33

A restaurant that makes items like bagels, pizzas, or cookies could use a fixed layout design very efficiently.

Question 34

A lease in which the tenant pays a base monthly rent plus some or all real estate taxes of the building is called a gross lease.

Question 35

Through a/an ________ distribution channel, products pass through various intermediaries before reaching the consumer.

A) Direct
B) Linear
C) Indirect
D) Non-linear

Question 36

__________ cause the product to go directly from producers to consumers.

A) Direct channels
B) Indirect channels
C) Distribution channels
D) Streamline channels

Question 37

If a service business is visited by the customer, location is not critical. The customer will find the business.

Question 38

A disadvantage of a lease agreement is that it may prevent a business owners from altering a building to fit the business's needs.

Question 39

Small manufacturers use the process layout primarily due to its flexibility.

Question 40

Aircraft and shipbuilders use the process layout in order to manufacture their product.

Question 41

Of the options listed, the most important decision that a small business owner makes is the choice of

A) The hours to be open
B) The location of the business
C) The decor of the building
D) The paint color for the walls

Question 42

The _____________ is the amount of personal income after taxes and deductibles made by people in a specific geographic area.

A) Buying power index
B) Effective buying power index
C) Gross income
D) Net income

Question 43

The following criteria are essential to analyze when evaluating a potential ________ for a business: price and availability of land and water, the labor pool, access to customers, and proximity of suppliers.

A) Target market
B) Location
C) Trademark
D) Brand name

Question 44

The effect of more consumers leaving a town to purchase goods rather than entering it to buy the same product is known as

A) Inshopping
B) Outshopping
C) Outsourcing
D) Inhouse shopping

Question 45

The effect of more consumers coming into a town to purchase goods rather than leaving it to buy the same products is known as

A) Inshopping
B) Outshopping
C) Outsourcing
D) Inhouse shopping

Question 46

The SMM Survey of Buying Power combines data on population, income, and retail sales by assigning a weight to each factor to calculate a/an

A) Effective consumer index
B) Buying power index
C) Consumer confidence index
D) Sales conversion index

Question 47

An intermediary who brings buyers and sellers together and facilitates the exchange is known as a/an

A) Wholesaler
B) Broker
C) Agent
D) Retailer

Question 48

You can do away with distribution intermediaries, but you cannot do away with their ______.

A) Transportation
B) Channel
C) Profit
D) Function

Question 49

If a business is selling a luxury good, the business would want to locate where the effective buying income (EBI) was in which of the following ranges?

A) High
B) Low
C) Average
D) Adequate

Question 50

Comparative information on ___________ can be found in the annual Metro Report by Inc. and the Sales and Marketing Management Survey of Buying Power.

A) Products
B) Advertising
C) Economic performance
D) Competitors

Question 51

Which of the following are not included on the charts published by Sales and Marketing Management Survey of Buying Power that were illustrated in the chapter?

A) Retail sales by region
B) Retail sales by store group
C) Per capita effective buying income (EBI)
D) Outshopping by product category

Question 52

Which of the following represents clients who buy or sell specialized goods or seasonal products and do not take title to the goods sold?

A) Agents
B) Brokers
C) Wholesalers
D) Retailers

Question 53

The United States is a collection of ____________ markets rather than one big market.

A) Local
B) Regional
C) Local and regional
D) National

Question 54

The effective buying income (EBI) is figured by subtracting _________ and nontax payments from personal income.

A) Personal taxes
B) Medical expenses
C) Rent/housing allowances
D) Food expenses

Question 55

Which of the following questions is the last question that should be asked when determining the best location for a business?

A) What region would be best?
B) What state within the region would be best?
C) What city within that region would be best?
D) What specific site within that city will work for the business?

Question 56

In the Entrepreneurial Snapshot, Buck Knives found itself in the situation that the only way to save the three-generation family business was to

A) Move the company to another state
B) Create a new channel of distribution
C) Relocate to a business incubator.
D) Bring in a nonfamily CEO

Question 57

A small business owner should begin the site selection process by asking which of the following questions?

A) What region would be best?
B) What state within the region would be best?
C) What city within that region would be best?
D) What specific site within that city will work for the business?

Question 58

The key word in evaluating a channel of distribution is

A) Location
B) Plastics
C) Competition
D) Efficiency

Question 59

A technique for comparing different locations based on residents' ability to convert personal income into retail purchases is known as the

A) SBa
B) SIc
C) SCI
D) SAb

Question 60

Wytt Foods Inc. buys food products in bulk from various producers and resells them to foodservice businesses across the region. Wytt Foods can best be described as a/an

A) Wholesaler
B) Manufacturer
C) Agent
D) Retailer

Question 61

The number of _____________ and ____________ passing a site strongly affects its potential retail sales.

A) Cars, people
B) Tour busses, people
C) Cars, tour busses
D) Policemen, people

Question 62

What is the first step in calculating the sales conversion index?

A) Calculate the SCI for the benchmark area
B) Divide retail sales by the EBI
C) Establish a benchmark area for comparison
D) Determine the area or county to be examined

Question 63

An essential component to the SCI is which of the following?

A) Health care expenses to be used for comparison
B) Operating expenses to be used for comparison
C) Profit margin to be used for comparison
D) A benchmark area to be used for comparison

Question 64

A business using the SCI to evaluate location sites looks for an SCI of

A) 20
B) 30
C) -10
D) +100

Question 65

Denver's Larimar Square and Chicago's Water Tower Place are examples of

A) The gentrification process
B) Urban blight
C) Areas with high crime rates
D) Areas with old, dilapidated buildings

Question 66

William has determined that he needs to expand parking at his bookstore, so he decides to purchase the empty lot across the street. This constitutes which site location consideration?

A) Economic factors
B) Type of site
C) Legal considerations
D) Accessibility

Question 67

_________ involves restoring old buildings or replacing them with new offices, retail shops, or housing.

A) Gentrification
B) Site selection
C) Diversification
D) Displacement

Question 68

Road patterns and condition, obstructive barriers, site visibility, traffic flow, and parking convenience are all questions to address when looking at _______________ in site selection.

A) Legal considerations
B) Economic factors
C) Type of site
D) Accessibility

Question 69

An SCI of above 100 indicates which of the following?

A) Outshopping
B) Inshopping
C) Outsourcing
D) An error made in the calculation

Question 70

In addition to conducting research on the country, a businessperson should consider __________ before going global with a business.

A) Meeting with businesspeople from that country
B) Talking to the U.S. State Department
C) Talking to the chamber of commerce in that country
D) Visiting the country personally

Question 71

The central business district is usually the __________ section of town.

A) Newest
B) Most expensive
C) Oldest
D) Safest

Question 72

Auto dealerships are often located close together because

A) They can share lot expenses
B) They can share salespeople
C) It is easier for customers to comparison shop
D) They can keep close watch on the competition

Question 73

Service and retail businesses have three basic choices for types of locations; central business districts, shopping centers, and ___________.

A) Main street areas
B) Manufacturing areas
C) Suburban areas
D) Stand-alone locations

Question 74

Neighborhoods are typically comprised of people who are

A) Very similar
B) Very different
C) A mixture of types of people
D) Different in their religious beliefs

Question 75

Types of sites, accessibility, legal considerations, and economic factors are all issues to address when choosing

A) A potential product
B) A potential advertising campaign
C) A potential management team
D) A potential business location

Question 76

Robert is opening a new bar and grill, and he is currently negotiating with the city's liquor board to obtain a liquor license before he can open. This constitutes which site location consideration?

A) Economic factors
B) Type of site
C) Legal considerations
D) Accessibility

Question 77

Occupancy costs, the cost of amenities, and all one-time costs and leasehold improvements are all questions to address when looking at _______________ in site selection.

A) Legal considerations
B) Economic factors
C) Type of site
D) Accessibility

Question 78

An SCI below 100 indicates which of the following?

A) Outshopping
B) Inshopping
C) Outsourcing
D) An error was made in the calculation

Question 79

A database that distinguishes differing neighborhood types by accurate geodemographic segmentation is known as

A) Neighborhood Type Inventory
B) Potential Rating Index for Zip Marketers
C) Geodemographic Database System
D) Neighborhood Segmentation Database

Question 80

The conversion factor of the SCI is determined by dividing total sales by which of the following?

A) Total expenses
B) Total profit
C) Effective buying income
D) The gross profit margin