Why would a discount store have a lower gross margin percent than a jewelry store?
A) Discount stores are only beginning to explore gross margin in pricing decisions.
B) Jewelry stores cannot offer the variety that discount stores offer.
C) Discount stores traditionally do not profit as well as jewelry stores.
D) Discount stores have a lower priced merchandise strategy.
E) Discount stores have a higher cost of goods sold.

Question

Quizplus · Accepted Answer

A retailer's strategy differs based upon its target customer and merchandise strategy. A retailer that offers less customer service and ambiance needs less gross margin to cover operating expenses.

Why Would a Discount Store Have a Lower Gross Margin