Question 1

Featuring exclusive national brands that are not available at competing retailers is a way of generating consumer interest in a retailer.

Accepted Answer

Featuring unique national brands that cannot be found in other stores can create a sense of exclusivity and differentiation for the retailer, making it more attractive to consumers.

Question 2

The network marketing sales system works by recruiting independent businesspeople who act as distributors.

Accepted Answer

The network marketing sales system relies on recruiting individuals to become independent distributors of products or services, who then sell those products and recruit more distributors to expand their network and increase their earnings.

Question 3

A superstore is a storeless retailer serving a specific clientele who are entitled to buy from a list of retailers that have agreed to give discounts in return for membership.

Accepted Answer

The definition provided in the statement does not match the common understanding of a superstore, which is a large physical store selling a wide variety of products at high volume and low prices. The definition provided in the statement more closely matches a buying club or discount club.

Question 4

Electronic shelf labeling allows retailers to check inventory levels instantaneously.

Accepted Answer

Electronic shelf labeling primarily allows for the automatic updating of product prices and information on shelves, but it does not directly enable the instantaneous checking of inventory levels.

Question 5

In order to clearly differentiate themselves from competitors, retailers must keep merchandise and prices always consistent.

Accepted Answer

Differentiation from competitors can also come from unique product offerings, exceptional customer service, store layout and design, marketing strategies, and value-added services. Consistency in merchandise and prices can still be important, but it does not necessarily guarantee differentiation.

Question 6

A franchise organization is a corporate retail organization.

Accepted Answer

The answer of A franchise organization is a corporate retail...

Question 7

Electronic shopping is a form of direct marketing.

Accepted Answer

Electronic shopping involves buying products directly from an online or digital platform, making it a form of direct marketing.

Question 8

Larger Asian department stores have established their own hypermarkets and discount outlets as a defensive strategy against foreign chains.

Accepted Answer

This statement is true. Larger Asian department stores can see foreign chains as a threat to their business and may establish their own hypermarkets and discount outlets to attract customers and compete with these foreign chains.

Question 9

Modern retailers use technology to produce better forecasts, control inventory costs, and order electronically from suppliers. Technology is also affecting what happens inside the store.

Accepted Answer

Modern retailers are indeed using technology to improve their forecasting abilities, manage inventory costs, and streamline the ordering process from suppliers. Additionally, technology is being used to enhance the overall in-store experience, whether through interactive displays, mobile checkout options, or personalized promotions based on customer data.

Question 10

Department stores only face competition from other department stores as other retailing forms are not a threat to their sales and profitability.

Accepted Answer

Department stores face competition from various forms of retailing such as e-commerce, discount stores, specialty stores, and others. These alternative forms of retailing offer customers a wider range of products, competitive pricing, and convenience which can impact the sales and profitability of department stores.

Question 11

Mass merchandisers are usually high-markup, lower-volume stores.

Accepted Answer

Mass merchandisers are typically low-markup, high-volume stores.

Question 12

A retailer cooperative is a retail firm that is owned by its customers.

Accepted Answer

A retailer cooperative is a type of cooperative that is owned and operated by its members, who are usually independent retailers, rather than its customers.

Question 13

The gross margin on a product bears a direct relation to the direct product profit.

Accepted Answer

The answer of The gross margin on a product bears...

Question 14

A retailer or retail store is any business enterprise whose sales volume comes primarily from wholesaling.

Accepted Answer

A retailer or retail store is a business enterprise whose sales volume comes primarily from selling goods or services directly to the end consumer, rather than through wholesale transactions to other businesses.

Question 15

"Pop-up" stores let retailers promote brands to seasonal shoppers for a limited time.

Accepted Answer

Pop-up stores are temporary retail spaces that can be used to promote a brand or sell products for a limited time, often during a particular season or for a special event. They allow retailers to create a sense of urgency and exclusivity among consumers, and can generate buzz and customer engagement.

Question 16

The franchisor owns a trade or service mark and licenses it to franchisees in return for royalty payments.

Accepted Answer

This is the basic model of franchising where the franchisor owns the rights to a trade or service mark and grants its use to franchisees in exchange for ongoing royalty fees.

Question 17

Consumers now receive sales offers through direct-mail letters and catalogs, television, cell phones, and the Internet. The non-store based retailers are taking business away from store-based retailers.

Accepted Answer

This statement is true as non-store based retailers have multiple channels to reach out to consumers and are able to offer a more convenient and personalized shopping experience, which has led to increased competition for store-based retailers.

Question 18

Some high-volume products may have such high handling costs that they are less profitable and deserve less shelf space than low-volume products.

Accepted Answer

High-volume products may have higher handling costs due to the need for constant restocking and upkeep, whereas low-volume products may require minimal handling but still contribute to profitability through higher profit margins. It is important for retailers to consider all costs and profitability factors when deciding how much shelf space to allocate to each product.

Question 19

Supercenters retail grocery items as well as a huge selection of nonfood merchandise.

Accepted Answer

Supercenters, such as Walmart and Target, are known for selling both grocery items and nonfood merchandise under one roof.

Question 20

Some retailers have not only defined their target markets quite well, but are also slicing the market into finer segments and introducing new lines of stores to provide a more relevant set of offerings to exploit niche markets.

Accepted Answer

This statement is true as some retailers have adopted a strategy of segmenting their target markets even further to better cater to specific niche groups with their products and services. They may introduce new lines of stores or brands to better appeal to these segments.

Quiz 16: Managing Retailing, Wholesaling, and Logistics