A retailer has to carefully determine the direct retailing costs associated with stocking a given item in computing _____.

Question

Quizplus · Accepted Answer

Direct retailing costs are the costs associated with stocking a product, such as purchasing, transportation, storage, and handling costs. These costs are subtracted from the revenue generated by the product to determine its direct product profitability. Inventory turnover, return of inventory investment, and gross profit per linear foot of shelf space are all related to profitability, but they do not directly involve the direct retailing costs associated with stocking a product.

A Retailer Has to Carefully Determine the Direct Retailing Costs