New retailers enter the market by reducing services so they can offer lower prices. This is referred to as_____________________________________.

Question

Quizplus · Accepted Answer

The "wheel of retailing" theory states that new retailers enter the market by offering low prices and reduced services, then gradually add services and increase prices as they establish themselves in the market. This cycle repeats itself as newer retailers enter, perpetuating the "wheel." Choices A, C, and D are not accurate descriptions of this phenomenon.

New Retailers Enter the Market by Reducing Services So They