Deck 2: Types of Retailers

Question 1

Mark's Work Wearhouse (clothing retailer)carries sizes for small,average,and big men,but all sizes are not available in all their stores.What should Mark's do to communicate this message to their customers?

A) They should advertise big men's merchandise on all of their newspaper supplements and commercials
B) They should train their sales associates to mention this when closing sales with each customer
C) A database should be developed of those who purchase merchandise for big men and then Mark's should market specifically to those shoppers
D) Mark's should actively advertise these assortments to competitors
E) Mark's should advertise this by featuring big men on their Holiday Catalogue

Answer 1

C

Question 2

Because the only merchandise category at the Futon Shop is double-sized futons,the Futon Shop can be said to have no:

A) inventory control
B) need for customer service
C) product depth
D) shrinkage
E) variety

Answer 2

E

Question 3

An example of brand image would be:

A) Walmart's wide variety of merchandise
B) Holt Renfrew's focus on upper-class customers
C) Talbots' red doors saying "Always classic, never closed"
D) Sears men's casual apparel department
E) Old Navy's current fashion merchandise

Answer 3

C

Question 4

Each different item of merchandise in a retail store is called a/an:

A) consumer offering
B) store counted item (SCI)
C) stored and keyed unit (SKU)
D) stock keeping unit (SKU)
E) economic unit

Question 5

NAICS:

A) Is a number used to identify an item in a company's inventory
B) Is a classification scheme used by retailers in Canada to monitor after-tax profits
C) Is an on-package series of thick and thin lines readable by check-out scanners
D) Is a classification scheme where every North American business is assigned a 6-digit code
E) None of these

Question 6

Isaac's Men's Store stocks 322 different styles and colours of ties.This assortment of ties can be referred to as Isaac's:

A) store's supply standard
B) complete retail offering
C) breadth of merchandise
D) retailer mix
E) depth of merchandise

Question 7

The dominant department stores in Canada are:

A) Sears, Holt Renfrew, and Hudson's Bay
B) Hudson's Bay, Sears, and Loblaws
C) Sears, Holt Renfrew, and Future Shop
D) Target and Sears
E) Hudson's Bay, Target, and Walmart

Question 8

Retailers compete with each other on:

A) format
B) variety
C) assortment
D) customer services
E) All answers provided are correct.

Question 9

Which of the following trends are changing the retail industry?

A) Growing retailer concentration and power
B) Blurring boundaries among channels and formats
C) Growth in consumer data
D) Discriminating consumers
E) All answers provided are correct.

Question 10

Frank was shopping for electric fuses for his fuse box.Flash Hardware sold them for $3.99 for a box of six,but when he went to the same retailer's website,he found the same set for $2.99.Flash Hardware has a problem with:

A) price consistency across channels
B) a pricing mistake by the store manager
C) a communication problem between channels
D) product consistency
E) depth of merchandise

Question 11

The Canadian retail marketplace is dominated by a small number of large retailers-which term does this describe?

A) diversity
B) globalization
C) concentration
D) Americanization
E) development

Question 12

The spawning of new categories and retailers from supercentres to the Internet best demonstrates the:

A) growing diversity of retail formats
B) necessity to focus on competition
C) necessity to go global with domestic retailers
D) need for training and development programs
E) tremendous need for better customer services

Question 13

Variety is often referred to as the:

A) store's supply standard
B) complete retail offering
C) breadth of merchandise
D) retail mix
E) depth of merchandise

Question 14

The greater the diversity of retail formats,the greater the:

A) competition in the industry
B) level of service provided to customers
C) maturation in the domestic market
D) price points
E) variety within a format

Question 15

Pinch-A-Penny sells a variety of pool maintenance supplies including filters,chemicals,lights,skimmers,and pool toys.Pinch-A-Penny can be said to have:

A) supply standard
B) complete retail offering
C) breadth of merchandise
D) retail mix
E) depth of merchandise

Question 16

My Favourite Quilt Shop carries quilting thread of every brand,colour and strength in cotton and poly-cotton blends.With reference to quilting threads,My Favourite Quilt Shop has:

A) broad variety
B) deep assortment
C) good customer base
D) little shrinkage
E) few SKU's

Question 17

A fundamental way to describe and distinguish between retailers is their retail mix.Which of the following is an element of that retail mix?

A) The type of merchandise sold
B) The price of the merchandise
C) The level of service provided to customers
D) The assortment of merchandise sold
E) All answers provided are correct

Question 18

Compared to other food retailers,convenience stores

A) Have higher food prices
B) Have a wide breadth and depth of merchandise
C) Benefit from the high margins of gasoline sales
D) Have less than 30% of their store devoted to food
E) Are experiencing slow growth in Asia

Question 19

To compete against intrusions by other food retailing formats,conventional supermarkets are:

A) Targeting health-conscious consumers
B) Offering more private-label products
C) Emphasizing fresh perishables
D) Providing a better in-store experience
E) All answers provided are correct.

Question 20

Depth of merchandise is often referred to as the:

A) variety
B) complete retail offering
C) number of items within each product line
D) object of the buy
E) retail mix

Question 21

As a result of increased competition,the category specialist sector is:

A) closing stores.
B) differentiating on customer service.
C) opening stores on an as-per-needed basis.
D) re-evaluating management selection.
E) requiring suppliers to give them allowances until the economy improves.

Question 22

Which of the following is a self-service food store offering groceries,meat,and produce with limited sales of nonfood items?

A) Big-box food retailer
B) Convenience store
C) Conventional supermarket
D) Superstore
E) All answers provided are correct.

Question 23

Which of the following can be purchased at a hypermarket?

A) Electronics
B) Sports equipment
C) Photographic film development
D) Hotdogs and luncheon meat
E) All answers provided are correct.

Question 24

The Home Depot offers customers a huge selection of home improvement merchandise.As a result inventory investment:

A) increases because of the increase in demand in the home improvement industry
B) increases because they have to carry backup stock for each SKU
C) increases because of the value of the assortment
D) decreases because of the increase of the customer base
E) decreases because of the introduction of backup stock

Question 25

The primary issue facing supermarket and convenience store retailers today is:

A) corporate development racing to catch up to store level
B) downsizing of middle management
C) expiration dates on perishables
D) increasing level of competition from other types of retailers
E) price wars

Question 26

Warehouse clubs:

A) have high margins
B) spend on visual displays
C) sell merchandise in a no-frills atmosphere
D) have low turnover
E) provide extensive customer service

Question 27

To respond to a competitive environment,discount retailers are fighting back by:

A) developing more private-label merchandise programs
B) focusing on promotional pricing rather than the traditional EDLP strategy
C) increasing assortments
D) offering better customer service on the floor
E) reducing prices below wholesale

Question 28

Rona and Home Depot are both category specialists for the home improvement industry.This means the stores:

A) offer their customers narrow breadth and depth
B) use quick-response inventory management systems
C) have excellent after-the-sale service
D) appeal to the mature consumers
E) offer a narrow but deep assortment of merchandise

Question 29

Home improvement centres:

A) advertise like discounters using EDLP strategy
B) use quick-response inventory management systems
C) are a type of specialty store
D) offer equipment and material for the do-it-yourself projects
E) All answers provided are correct.

Question 30

H&M uses the philosophy of "disposable chic".This means:

A) Consumers can dispose of their income at H&M
B) The product line at H&M is recyclable.
C) Its merchandise is so inexpensive it doesn't matter if it goes out of style quickly.
D) It has a merchandise agreement with Gillette disposable razors.
E) Its merchandise is considered "chic" in Sweden

Question 31

Target and Walmart are examples of:

A) convenience stores
B) department stores
C) discount stores
D) specialty stores
E) variety stores

Question 32

What is one way a convenience store can develop a sustainable advantage against competition?

A) Close less convenient locations
B) Extend hours of operation
C) Nothing: convenience stores are becoming extinct
D) Open more stores
E) Sell prepared meals

Question 33

Category specialists in direct competition with each other typically compete on the basis of:

A) advertising
B) in-store promotions
C) distribution strategies
D) product variety and assortment
E) cost of goods/retail price

Question 34

Category specialists are sometimes called category killers because they:

A) can destroy a category of merchandise for other retailers.
B) are located at stand-alone sites.
C) have a broad merchandise mix and shallow assortment.
D) are often located in dying shopping malls.
E) carry mainly technologically obsolete merchandise.

Question 35

Zara,a specialty store,produces how much of its own clothing line?

A) less than 20%
B) greater than 50%
C) None
D) 100%
E) less than 40%

Question 36

Which of the following statements about warehouse clubs is true?

A) Warehouse clubs only sell to ultimate consumers.
B) Warehouse clubs have a category specialist format.
C) Warehouse clubs typically have high inventory holding costs.
D) Warehouse clubs have simple interiors and concrete floors.
E) Warehouse clubs have extensive merchandise depth.

Question 37

How did Target,in the U.S.,become a major competitor in the discount retailer area?

A) They developed the EDLP strategy.
B) They utilize promotions unlike Walmart.
C) Target researched and reacted to consumer trends by offering stylish merchandise, at low prices, that is unavailable elsewhere.
D) Target targets the stay-at-home-mom segment of the population.
E) All answers provided are correct.

Question 38

Al is the office manager for a large travel agency.He is responsible for maintaining the office supplies and works within a budget.This month,he needs to restock the agency's #10 envelopes,ball-point pens,coffee,sweetener and plastic spoons.Where's the best place for him to shop?

A) Loblaws
B) Office Depot
C) Costco
D) 7-Eleven
E) Zellers

Question 39

Which of the following statements about discount stores is true?

A) They do not carry private-label merchandise.
B) They have greater depth of merchandise than department stores.
C) They typically carry more brands and sizes in each category than department stores.
D) They tend to offer a broad variety of merchandise.
E) All answers provided are true.

Question 40

Category specialists:

A) have little customer service
B) are limited to clothing, office supply, pet supplies, and toy retailing
C) rely on warranty sales to promote loyalty
D) offer a narrow variety but deep assortment of merchandise
E) compete directly with off-price retailers

Question 41

Which of the following best describes the target market for catalogue and direct-mail retailers?

A) people who live in rural communities
B) members of a pyramid network
C) people who do not enjoy in-store shopping
D) people who enjoy the convenience of shopping by catalogue
E) people who mostly shop department stores

Question 42

In a multilevel network,master distributors:

A) recruit other people to become distributors in their network
B) are responsible for training the salespeople they recruit
C) may receive a commission on all merchandise purchased by the distributors in their network
D) sell to customers in their network
E) All answers provided are correct.

Question 43

Where are most direct sales made?

A) Via a computer connection
B) At street festivals and craft shows
C) Over the phone
D) On the job site
E) Face-to-face, in a home

Question 44

A ______ develops when a firm's marketing program is designed to sell merchandise and services to other distributors rather than to retail customers.

A) multilevel network
B) general merchandise retailer
C) party plan
D) pyramid scheme
E) commission

Question 45

The non-store retail format in which the retail offering is communicated to a customer through a catalogue is called:

A) catalogue retailing
B) electronic retailing
C) Internet marketing
D) media-oriented retailing
E) direct-mail retailing

Question 46

A retailer that carries a broad variety and deep assortment of stock,offers customer services,and are organized into separate departments for displaying merchandise is called a:

A) category killer
B) department store
C) discount retailer
D) home improvement centre
E) specialty retailer

Question 47

When multilevel direct selling becomes a pyramid scheme:

A) typical annual sales of products often double
B) the salespeople are no longer independent agents
C) little merchandise is sold to end users
D) the selling format is usually franchised
E) the use of the party plan becomes more commonplace

Question 48

Which of the following categories would you most likely not see in a department store?

A) Accessories
B) Home furnishings
C) Kitchenware
D) Toys
E) Women's apparel

Question 49

Which of the following is an example of a department store?

A) Chapters
B) Future Shop
C) Hudson's Bay
D) Mark's Work Wearhouse
E) Home Hardware

Question 50

Last March Julie went shopping at a _____ and found leather coats for $45,name-brand tubes of lipstick for $1,and 10 cans of cat food for $2.00.When she returned this week,there was no lipstick or cat food,but she did find a 10-gallon aquarium for $8.00 and a plastic lawn chairs for $12.

A) factory outlet
B) specialty price store
C) closeout retailer
D) warehouse retailer
E) wholesaler outlet

Question 51

The main difference between direct-mail retailers and catalogue retailers is that direct-mail retailers are:

A) businesses that have low start-up costs
B) consistent with catalogue retailers in that they maintain long-term relationships
C) highly involved in database management
D) primarily interested in a single sale from a specific mailing while catalogue retailers maintain relationships with customers over time
E) usually considered junk mail and are discarded

Question 52

Which of the following offers drive-through windows as a response to competition from discounters and grocery stores?

A) Big-box retailers
B) Category specialists
C) Drugstores
D) Kiosks
E) Specialty shops

Question 53

Direct selling:

A) is a highly interactive form of retailing
B) most often takes place in the home
C) is mainly performed by independent agents
D) can be done over the telephone
E) All answers provided are correct.

Question 54

The retail format in which the retailers communicate with customers and offer products and services for sale over the Internet is called:

A) catalogue retailing
B) computerized shopping
C) direct selling
D) electronic retailing
E) television home shopping

Question 55

All of the following are commonly leased departments in department stores except:

A) beauty salons
B) appliances
C) photography studios
D) jewellery
E) pharmacies

Question 56

Kelly is a primary school teacher.She needed some small gifts for her students.She was pleased when she went in A Buck or Two and found she could buy colouring books,plastic scissors,pencil bags,puzzles,and games all priced at $1.00 each.A Buck or Two is an example of a:

A) value retailer
B) general merchandise retailer
C) specialty retailer
D) price killer
E) price specialist

Question 57

Off-price retailers:

A) offer a consistent assortment of soft goods at low prices.
B) give cash refunds.
C) offer gift wrapping services.
D) sell brand-name and even designer-label merchandise at reduced prices.
E) require suppliers to give them a variety of allowances and discounts.

Question 58

Manufacturers view their outlet stores as advantageous over selling to other off-price retailers because:

A) it allows them some control over where their branded merchandise is sold
B) they do not have to work with buyers of other companies
C) they are interested in by-passing traditional retailers and wholesalers and sell direct to the consumer
D) they do not have to offer rock-bottom prices
E) All answers provided are correct.

Question 59

The two types of off-price retailers are:

A) outlet and closeout stores
B) value retailers and closeout stores
C) closeout and value stores
D) warehouse clubs and closeout stores
E) outlet stores and warehouse clubs

Question 60

Specialty stores that concentrate on health and personal grooming merchandise are:

A) closeout retailers
B) off-price retailers
C) direct-mail retailers
D) discount stores
E) drugstores

Question 61

Ben saw a half-hour TV show with George Foreman on it.During the show Foreman was showing how to prepare a variety of foods so that they would be totally fat-free.Each item was prepared using a special cooker.During the show the TV audience were given several opportunities to buy the cooker.Ben was watching:

A) direct selling
B) an infomercial
C) a sales promotion
D) outbound telemarketing
E) interactive electronic retailing

Question 62

The most common purchases from vending machines are:

A) ice
B) airplane insurance
C) condoms
D) beverages and snack food
E) cigarettes

Question 63

How can a service retailer best cope with the problems associated with the inconsistency of service?

A) Use low prices during off-seasons to help match supply and demand.
B) Use mass production.
C) Emphasize quality control.
D) Train, manage, and motivate service providers.
E) Increase staffing at peak demand times.

Question 64

Martina was watching a Made-for-Television Movie on the Life Channel when she saw an ad for a series of books for people who want to save money on home repairs.She called and ordered the book on plumbing that was first in the series.Martina responded to:

A) direct selling
B) an infomercial
C) direct-response advertising
D) outbound telemarketing
E) interactive electronic retailing

Question 65

A multichannel retailer is one that:

A) works with other retailers who are in the channel
B) channels all assortments through the stores
C) sells merchandise or services through more than one channel
D) buys merchandise from multiple channels to sell in the stores
E) is a combination of single-channel retailers

Question 66

Infomercials:

A) are 60-seconds commercials
B) do not usually solicit orders
C) use testimonials rather than demonstrations to sell products
D) are not shown on cable television
E) are 30-minutes commercials

Question 67

A company operating multiple retail units under common ownership and usually has centralized decision making for defining and implementing its strategy is called a:

A) franchise
B) full-line discount stores
C) retail chain
D) single-store establishment
E) wholesale-sponsored voluntary cooperative group

Question 68

Why do movie theatres sell tickets for an afternoon showing at a lower price than the 7 p.m.showing of the same movie?

A) To deal with the incompatibility characteristic of services
B) To make sure the service offered in consistent
C) To deal with the intangible characteristic of services
D) To deal with the perishability of services
E) To minimize inventory losses

Question 69

In a franchise contract,the franchisor:

A) makes sure all franchise outlets provide the same quality of service and products
B) agrees to operate a franchise outlet in accordance with procedures prescribed in the contract
C) agrees to pay a royalty to the franchisee
D) is given permission to use a franchise name and format
E) All answers provided are correct.

Question 70

Typically,large retail chains:

A) are completely decentralized
B) encourage their store managers to be flexible and creative
C) have efficient distribution systems
D) have lower total fixed costs than other forms of ownership
E) are very flexible in their responses to the unique needs of their local markets

Question 71

How can a service retailer best cope with the some of the problems associated with the intangibility of service?

A) Use low prices during off-seasons to help match supply and demand.
B) Use mass production.
C) Emphasize quality control.
D) Solicit customer evaluations and complaints.
E) Increase staffing at peak demand times.

Question 72

In a franchise contract,the franchisee pays the franchisor a:

A) bonus if the sales quota is achieved
B) lump sum plus a royalty on all sales
C) start-up costs plus a monthly predetermined cash amount
D) commission on all sales
E) salary plus a variety of employee benefits

Question 73

The major advantage of TV home shopping compared to catalogue retailing is:

A) its ability to create time and place utility
B) customers can see the merchandise being demonstrated on TV
C) the easy return policy for unsatisfactory products
D) its ability to schedule when certain types of merchandise will be shown
E) the lack of federal regulation of the medium

Question 74

Due to the _____ of services,service retailers like Disney,Famous Players,and Air Canada sometimes find it difficult to match supply and demand.

A) intangibility
B) perishability
C) inconsistency
D) consumability
E) compatibility

Question 75

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

A) Susan and Michael's Hair Salon
B) eBay
C) Sears
D) The Keg restaurant
E) 7-Eleven convenience stores

Question 76

What do WestJet (airline),Four Seasons (hotel chain),Century 21 (real estate company),and Rogers Video (video outlet)have in common?

A) These retailers have established long-term relationships with their manufacturers.
B) They are all examples of off-price retailers.
C) They sell tangible products.
D) They are all examples of service retailers.
E) They have high operating margins due to the size of their inventories.

Question 77

When compared to catalogue retailing,TV home shopping has which of the following disadvantages?

A) The customer's inability to look at products when they want to
B) The customer's ability to watch products being demonstrated
C) The difficulty inherent in returning unsatisfactory products
D) The ability to schedule when certain types of merchandise will be sold
E) The lack of federal regulation of the medium

Question 78

A retailer that sells merchandise and/or services through more than one channel is called a/an:

A) computerized retailer
B) direct seller
C) electronic retailer
D) multichannel retailer
E) single-channel retailer

Question 79

Which of the following is not a benefit of retail store channel shopping?

A) Browsing
B) Cash payment
C) Personal service
D) Personal safety
E) Touch and feel products

Question 80

Which of the following describes an advantage that independent,single-store establishments have over other forms of ownership?

A) Economies of scale
B) Very low set-up costs
C) Bureaucratic operation
D) Ability to respond almost immediately to market changes
E) Distribution efficiency