Deck 15: Retailing

Question 1

As a general rule of thumb, what will a retailer with a high gross margin also have?

A)an inventory management system
B)low prices
C)salespeople trained in cross-selling techniques
D)high prices

Answer 1

D

Question 2

What is a full-line discount store?

A)a store that offers consumers very limited service
B)a store that offers groceries and general merchandise
C)a store that competes only on price
D)a store that consumers love to benefit by

Answer 2

A

Question 3

When a store offers a wide variety of nontraditional goods and services under one roof, what is this called?

A)giving the customer lots of choices
B)confusing the customer
C)scrambled merchandising
D)a store that has everything

Answer 3

C

Question 4

This type of retailer concentrates in a given type of merchandise with a deep but narrow assortment. It is not only a type of store, but also a method of retail operations. What is it?

A)a warehouse club
B)a convenience store
C)a specialty store
D)a general store

Question 5

Which of the following is one way that a retail store can be classified?

A)according to its distribution method
B)according to its inventory control
C)according to its product assortment
D)according to its decor and atmosphere

Question 6

The Big House is a large, departmentalized, self-service retailer that specializes in a wide assortment of food and some nonfood items? What kind of retailer is it?

A)a supermarket
B)a convenience store
C)a membership wholesale club
D)a discount store

Question 7

A manufacturer wants to introduce a line of handmade children's clothing to the growing number of professional women who are now having babies. The least expensive of these outfits will be $75. Which of the following types of stores would most likely support an effective product launch?

A)an off-price retailer
B)a specialty store
C)a full-discount store
D)a warehouse club

Question 8

The Gap Inc. is an American multinational clothing company. All of its stores are owned and operated as a group by head office. All of its administrative and purchasing tasks are also handled by head office. What are Gap's stores called?

A)home base stores
B)independent retailers
C)franchisees
D)chain stores

Question 9

What types of operations are small neighbourhood florists, shoe stores, and ethnic food markets most likely to be?

A)franchise outlets
B)membership clubs
C)chain stores
D)independent retailers

Question 10

Applying what you have learned about retailing, which type of retail store would typically have the highest labour costs?

A)a warehouse club
B)a department store
C)an off-price retailer
D)a discount store

Question 11

What type of retailer is the Running Room?

A)a franchisee
B)a category store
C)a department store
D)a specialty store

Question 12

Harry Rosen is a retail chain of 15 high-end men's clothing stores. A privately owned company, Harry Rosen accounts for 40 percent of the Canadian market in high-end menswear. The Harry Rosen stores carry the best of the best in menswear in Canada. How is Harry Rosen differentiating itself from other clothing stores?

A)through cultural positioning
B)through specialty retailing
C)through unique products
D)through store location modelling

Question 13

Snow White Toys sells Disney based products to children for their own enjoyment. What would Snow White Toys be characterized as?

A)a wholesaler
B)a retailer
C)a business
D)a distributor

Question 14

Long & McQuade sells only guitars by Fender and ukuleles by Kala. It makes large margins on its products and ensures that its customers are dealt with by highly trained staff. What would Long & McQuade be characterized as?

A)a drugstore
B)a warehouse club
C)a convenience store
D)a specialty store

Question 15

The Grape Vine Market is a nearly 1,700-square-metre store offering highly collectible food and wine-along with some other culinary experiences, including a cooking school-all in a setting crafted to make shoppers feel comfortable. It stocks more than 5,500 different kinds of wine. From this description, what is Grape Vine Market?

A)a hypermarket
B)a factory outlet
C)a specialty store
D)a department store

Question 16

Which of the following is the best example of a retailer?

A)the public library
B)a radio station
C)a real estate company
D)an advertising agency

Question 17

Which of the following statements best describes specialty stores?

A)Specialty stores focus only on three or four categories.
B)Specialty stores are not concerned with the distinctiveness of the merchandise or the store's physical appearance.
C)Specialty stores typically avoid price wars.
D)A typical specialty store carries a wider assortment of specialty merchandise than department stores.

Question 18

Which of the following houses several departments under one roof, carries a wide variety of shopping and specialty goods, and provides a high level of service?

A)a supermarket
B)a specialty store
C)a convenience store
D)a department store

Question 19

Costco carries automotive supplies and other products.How would you describe Costco?

A)It is a chain store.
B)It is a shop with a large product assortment.
C)It is an independent retailer.
D)It is a licensor.

Question 20

Around the world, most merchandisers operate one or a few stores in their community, owned by a single person or partnership and not operated as part of a larger retail institution. What are these operators called?

A)independent retailers
B)chain stores
C)franchise outlets
D)specialty clubs

Question 21

Real Canadian Superstore is a chain of retail outlets in Canada that are described as large, departmentalized, self-service stores that specialize in wide assortments of foodstuffs and limited nonfood items. Real Canadian Superstores would be classified as which of the following?

A)off-price retailers
B)discount stores
C)wholesale clubs
D)supermarkets

Question 22

Costco carries a broad assortment of nationally branded hard goods (broader than a department store) and offers customers very limited service. What would Costco be classed as?

A)a full-line discount store
B)a factory outlet
C)a price cut store
D)a specialty supercentre

Question 23

What is the term for a retail operation that has a 8,300-square-metre facility, houses a florist, baker, bank, craft shop, photo finisher, dry cleaner, and pharmacy under the same roof as grocery and household items?

A)a membership warehouse club
B)a wholesale outlet
C)a supercenter
D)a mass merchandiser

Question 24

Walmart sells products that fall under many different categories. These include groceries, seasonal, toys, and sporting goods to mention a few. What are they involved in?

A)cross-selling
B)trading up
C)scrambled merchandising
D)cross-docking

Question 25

These self-service stores carry a limited line of high-turnover, high-priced goods and resemble miniature supermarkets. They are typically located near residential areas and are open long hours, seven days a week. What are they?

A)specialty stores
B)wholesale stores
C)convenience stores
D)factory outlets

Question 26

For consumers, the initial attraction of drugstores was the pharmaceuticals they carried, but now consumers can have their prescriptions filled at mass merchandisers, at supermarkets, and through the mail. What have drugstores done to remain competitive?

A)raised their prices
B)taken legal steps to prevent the sale of prescription drugs at supermarkets
C)provided customers with value-added services
D)introduced generic prescription medicines

Question 27

Why are prices usually higher in convenience stores than in supermarkets?

A)Convenience stores offer a wider variety of products.
B)Convenience stores offer a higher level of customer services.
C)Convenience stores offer better location, longer hours, and faster service.
D)Convenience stores offer higher quality goods.

Question 28

Glen's Safety First! sells a huge assortment of firefighting and other safety equipment at greatly reduced prices. It offers customers few services and competes on the basis of moderate to low prices on the large quantities of merchandise it stocks. What is Glen's Safety First! an example of?

A)a full-line discount store
B)a specialty discount store
C)a general store
D)a wholesale store

Question 29

What is the term for the retailing strategy of using moderate to low prices on large quantities of products and lower service to stimulate a high turnover of inventory?

A)specialty store positioning
B)merchandise positioning
C)the wheel of retailing
D)mass merchandising

Question 30

According to your textbook, what is one way supermarkets establish long-term relationships with their customers?

A)by avoiding any obviously ethnic appeal
B)by limiting the number of nonfood items carried by the stores
C)by using loyalty marketing programs
D)by creating customer correlation studies

Question 31

Home Depot Fuel is the name of a chain of convenience stores owned and operated by The Home Depot. These stores typically sell gas and are located just outside The Home Depot warehouse store. What else can you presume about the Home Depot Fuel convenience stores?

A)They carry a wide assortment of products.
B)They carry a limited line of high-turnover goods.
C)They compete on the basis of low price.
D)They carry the same merchandise found in The Home Depot.

Question 32

Which of the following retailers compete on the basis of low prices, high turnover, and high volume?

A)specialty stores
B)discount stores
C)general stores
D)department stores

Question 33

Last year, over two million people visited Wine.com and bought 14,000 different fine wines at discounted prices. Wine.com shipped wine to over 100,000 customers generating more than $30 million in sales. Wine.com has since become the most trafficked wine site in the world. As an online retail operation, how would Wine.com correctly be labelled?

A)a full-line discount store
B)a category killer
C)a department store
D)an off-price retailer

Question 34

Why are specialty stores such as Office Depot, Bed Bath & Beyond, and Staples often called category killers?

A)They can destroy the profit potential for a grouping of merchandise for other retailers.
B)They are located at stand-alone sites.
C)They have a broad merchandise mix and shallow assortment.
D)They offer an exclusive category of merchandise.

Question 35

Walmart utilizes a strategy of moderate to low prices on large quantities of products and lower levels of service to stimulate a high turnover of inventory. Walmart offers a wide variety of different product lines. What is Walmart an example of?

A)a mass merchandiser
B)a convenience store
C)a franchising operation
D)a specialty store

Question 36

Spar is Ireland's largest supermarket chain. Which of the following is the most likely reason that Spar supermarkets sell all types of foodstuffs as well as nonfood products including a wide range of firearms and gun accessories?

A)Demand for one-stop shopping often leads to scrambled merchandising.
B)Fulfillment of the wheel of retailing hypothesis is important to Spar.
C)Buying in bulk helps Spar to operate as a discounter.
D)Spar is taking advantage of the growth of convenience merchandising.

Question 37

Costco, Safeway, Metro, and other supermarket chains offer a variety of nontraditional goods and services such as DVD rental, flower shops, dry cleaning, and banking. What is this practice called?

A)convenience merchandising
B)specialty service
C)trade-up positioning
D)scrambled merchandising

Question 38

Which of the following best describes discount stores?

A)They compete on the basis of low prices, high turnover, and high volume.
B)They sell high-priced, low-turnover products.
C)They provide their customers with full service.
D)They compete on the basis of assortment and depth.

Question 39

Hudson's Bay's Home Outfitters sells furnishings and uses self-service, discount prices, high volume, and high turnover of merchandise to their advantage. What are they are?

A)a specialty discount store
B)a factory outlet
C)a mass merchandiser
D)a membership club

Question 40

Winners and Marshall's sell a variety of products. What type of retailers are they?

A)specialty discount stores
B)category killers
C)off-price retailers
D)full-line discount stores

Question 41

Costco is a warehouse membership club. Which of the following best describes it?

A)It sells only to ultimate consumers.
B)It is a type of category specialist.
C)Its merchandise is displayed without any frills and inventory turns over quickly.
D)It has extensive merchandise depth, which it uses to create demographic positioning.

Question 42

The Mad Stencilist has decided to demonstrate how to use its products to create custom gift tags on a local television channel and to encourage shoppers to call a toll-free number to purchase the merchandise with a credit card. What is this form of retailing called?

A)an in-store electronic shopping experience
B)a shop-at-home network
C)an electronic point of sale
D)a catalogue viewing

Question 43

Jeanette Pelletier has decided to sell a sourcebook of French Canadian suppliers to businesses in French areas. She plans to call prospective customers and try to sell to them over the phone. Which of the following retailing techniques will Pelletier be using?

A)m-commerce
B)indirect retailing
C)franchising
D)direct marketing

Question 44

What is the term for a low-profile yet important form of retailing in which consumers get products out of machines, and that accounts for $60 million worth of sales each year in Canada?

A)automatic vending
B)machine retailing
C)direct marketing
D)robotic purchasing

Question 45

Chez Amie manufactures children's clothing for infants and toddlers. Its sales representatives set up parties at homes of mothers of preschool children so that its sales reps can demonstrate the quality and value of the Chez Amie products. What is Chez Amie using?

A)direct-response marketing
B)personal marketing
C)selling representation
D)direct retailing

Question 46

What is the term for the use of a telephone to sell directly to customers?

A)telemarketing
B)teleprompting
C)indirect marketing
D)phone vending

Question 47

Sunni received a phone call last night during supper. The caller wanted her to subscribe to a travel magazine. Since Sunni had never thought of purchasing this type of magazine before she received the call, this is obviously an example of what type of telemarketing?

A)outbound
B)qualifying
C)inbound
D)relationship

Question 48

Which of the following sell a limited selection of brand-name appliances, household items, and groceries, usually in bulk on a cash-and-carry basis to those who belong?

A)factory outlets
B)wholesale discounters
C)off-price discount retailers
D)warehouse membership clubs

Question 49

Surj is constantly called at dinner time by unsolicited telemarketers. What is the name for the opposite of these types of calls?

A)lead generation calling
B)response calling
C)outbound calling
D)inbound calling

Question 50

What is the term for an off-price retailer that is owned and operated by a manufacturer and carries one line of merchandise-its own?

A)mass merchandiser
B)factory outlet
C)wholesale club
D)discount store

Question 51

Manufacturers of Pampered Chef kitchen equipment and Longaberger baskets utilize party plan selling. The sales transactions usually occur in a home setting. What is the name for this form of nonstore retailing?

A)direct retailing
B)personal marketing
C)direct-response marketing
D)vending

Question 52

A publisher of books on holiday decorating, cooking, and crafts has to find a way to dispose of its overrun and unsold end-of-season output. To whom should the firm sell the remaining merchandise?

A)convenience stores
B)department stores
C)supermarkets
D)off-price discount retailers

Question 53

Laura buys supplies for her catering business at a retailer that stocks a limited selection of items, which are sold in bulk on a cash-and-carry basis to those who belong. As she browses through a huge store, she buys flour, a set of muffin pans, and a package of paper towels as well as an assortment of fresh produce. Where is Laura most likely shopping?

A)at an off-price discount retailer
B)at a factory outlet
C)at an industrial supply warehouse
D)at a warehouse membership club

Question 54

Well-known manufacturers such as Nike and Polo Ralph Lauren have decided the most profitable way to dispose of out-of-season and irregular stock is to open stores and sell their own merchandise. What type of stores are these?

A)seasonal outlets
B)factory outlets
C)discount stores
D)bargain basements

Question 55

The Cedar Store carries a full line of cedar swings, gliders, garden benches, and tables. All of its products can be purchased through its website. The site has done well since the Cedar Store's products do not need to be touched or smelled before purchase. What is The Cedar Store engaging in?

A)online retailing
B)mobile vending
C)franchising
D)electronic wholesaling

Question 56

Which of the following statements best describes nonstore retailing?

A)The nature of the communications between the retailer and the customer is the same in all forms of nonstore retailing.
B)Nonstore retailing is currently growing faster than in-store retailing.
C)The high growth rate for nonstore retailing is due to the growth of TV home shopping.
D)Nonstore retailing is increasing at a rate lower than in-store retailing.

Question 57

Sarah hates shopping at malls during the Christmas rush. She much prefers to use catalogues, the internet or even vending machines. In fact this type of shopping is currently growing faster than in-store shopping. What is this known as?

A)nonstore retailing
B)customerization
C)hypershopping
D)virtual buying

Question 58

Techniques used to get consumers to buy from their home include direct mail, catalogues and mail order, telemarketing, and electronic retailing. What is the term for this process?

A)in-home retailing
B)franchising
C)direct marketing
D)direct retailing

Question 59

Mr. Bilson, the owner of a new restaurant, wants to target customers based upon their gender, age, lifestyle, and values. Which method should he use?

A)direct mail
B)vending machines
C)specialty retail outlets
D)electronic selling

Question 60

Which of the following best describes off-price retailers?

A)They are often able to take advantage of manufacturers' faulty sales forecasting.
B)They seldom stock brand-name merchandise.
C)They are owned by the manufacturer of the products they sell.
D)They offer very deep assortments.

Question 61

Which of the following stores has embraced omni channel retailing?

A)Walmart
B)Holt Renfrew
C)Hudson's Bay
D)Loblaws

Question 62

What do large retailers such as Canadian Tire and Walmart and sellers of shopping goods such as automobiles and furniture often use for their locations?

A)remote rural locations
B)factory outlets
C)freestanding stores
D)regional malls

Question 63

Retailers such as Hudson's Bay and Saks are responding to consumer needs by changing product mixes, hours of operation, locations, and prices. Which aspects are these stores changing?

A)their merchandising groupings
B)their retailing mixes
C)their product offerings
D)their store positioning strategies

Question 64

With Arby's, Jiffy Lube, Baskin-Robbins, and Sylvan Learning Centres, the franchisee buys the right to use the franchisor's approach to doing business. These are examples of which of the following?

A)trade name franchising
B)product franchising
C)business format franchising
D)franchise wholesaling

Question 65

Which of the following statements about best describes online retailing?

A)Online retailing is also called e-merchandising.
B)After a rapid increase in sales, the popularity of online retailing has declined over the last decade.
C)Most traditional retailers are using online retailing to move merchandise that can be purchased at their stores.
D)The earliest use of online retailing was for Internet auctions.

Question 66

What is the first task of developing a retail strategy?

A)Decide what to buy.
B)Define the target market.
C)Create a promotional strategy.
D)Define the pricing policies.

Question 67

A new Mexican food retailer is currently granting business rights to individuals who want to use its logo and large buying advantage. What type of agreement is the retailer offering?

A)a leasing contract
B)a brokered partnership
C)a franchise
D)a countertrade

Question 68

Retailers control the six Ps of the retailing mix. The six Ps include the marketing mix plus which of the following?

A)personnel and presentation
B)production and people
C)personality and persuasion
D)positioning and purchasing

Question 69

Why is the selection of a retail location so critical to a store's success?

A)Customers will not drive out of their way to find a store.
B)A location decision ties up funds that will not appreciate or gain in value.
C)A location decision typically requires long-term commitment of resources.
D)Employee density is affected by the area in which the store is located.

Question 70

What is the first step in developing a retail strategy?

A)define the target market
B)set up a sales team
C)build a franchise network
D)decide on the product offerings

Question 71

Which of the following statements best describes a retailer's promotion strategy?

A)The design of the promotion strategy would be done separately from the creation of the retailing mix.
B)The goal of a retail store's promotion mix is to position the store in consumers' minds.
C)Most advertising for retailers is carried out at the national level.
D)Retail promotion strategy does not include public relations activities.

Question 72

What new trend in retailing does Best Buy suffer from?

A)omni retailing
B)e-tailing
C)showrooming
D)webrooming

Question 73

Gap Inc. opened its first freestanding Banana Republic store in Japan in the fall of 2006. Which of the following best describes its freestanding store?

A)It contains merchandise different from that offered in Banana Republic stores in shopping centres.
B)It is not a destination store.
C)It creates greater visibility for the store than it would have in a shopping centre.
D)It is an off-price retailing operation for the store chain.

Question 74

With General Nutrition Centers, Uniglobe Travel, and Wendy's the franchisee buys the right to use the franchisor's approach to doing business. Which of the following would these be categorized as?

A)product and trade name franchisors
B)redistributor franchisors
C)business format franchisors
D)licensed franchisors

Question 75

When opening a new retail operation, which of the following factors does the retailer NOT need to consider?

A)traffic flow
B)employee density
C)nature of the competition
D)land costs

Question 76

A retailer in Brandon, Manitoba, is licensed to sell Snapper lawn mowers. What type of retailer is it?

A)a product and trade name franchisee
B)a redistributor franchisor
C)a business format franchisee
D)a licensed franchisor

Question 77

Pam is under pressure. It's back-to-school time and her children need school supplies. Pam plans on visiting Staples, a stationery store. What is Staples also classed as?

A)a destination store
B)a drugstore
C)a department store
D)a lifestyle store

Question 78

Retailers combine the elements of the retailing mix to come up with a single retailing method to attract the target market. What does the retailing mix consist of?

A)product offerings
B)four Ps plus presentation and personnel
C)four Ps plus people
D)price, place, promotion, product

Question 79

Which of the following is NOT a reason that an individual may be tempted to buy a franchise rather than develop his or her own independent business?

A)The individual can try his or her own personal innovative product and service ideas in the business.
B)Purchasing a well-known product or service name helps to communicate the brands benefits.
C)Potential franchisees are asked to go through thorough management training.
D)The business's established image cuts down on the uncertainty inherent in operating a new venture.

Question 80

What do retail managers develop marketing strategies based on?

A)goals and the strategic plan
B)product name
C)target market they are serving
D)geographical market they are targeting