Deck 1: Introduction to the World of Retailing

Question 1

A retailer that is vertically integrated:

A) concentrates on selling to businesses only
B) does not have frequent communication between buyers and managers
C) has an excellent vertical relationship between corporate headquarters and stores
D) performs more than one function in the chain from manufacturing to sales to end user
E) performs only the function to end user

Answer 1

D

Question 2

Which of the following would be considered a retailer?

A) A radio talk show
B) A university
C) The Better Business Bureau
D) The Red Cross
E) All of these

Answer 2

B
Explanation: Although it could be argued that they all can accept money in some way or offer a service in some way, a university is most likely to be engaged in accepting money and then providing a service to the ultimate customer for personal use.

Question 3

Grocers purchase bananas from several different tropical countries.When bananas arrive in the distribution centres across Canada,containers are reduced to amounts that are appropriate for store delivery.Once delivered to the stores,associates open the cartons and arrange the bananas for the consumer to select.Grocers are performing what function?

A) Holding inventory
B) Vertical integration
C) Breaking bulk
D) Distribution
E) Providing services

Answer 3

C

Question 4

Retailing is the nation's largest industry in terms of:

A) community involvement
B) competition
C) employment
D) promotions
E) variety

Question 5

Which of the following businesses would be considered a retailer?

A) Your local hair salon
B) Air Canada
C) Tim Hortons
D) Canadian Tire
E) Your local hair salon, Air Canada, Tim Hortons, and Canadian Tire

Question 6

What is retailing?

A) It is the set of business activities that adds value to the products and services sold to consumers for their personal or family use
B) It is the merchandising component of the retail mix
C) It is the strategy retailers and vendors use to get products into the stores
D) It is the process of offering products in smaller quantities for consumer consumption patterns
E) It is the ability to offer enough variety in a store to encourage one-stop shopping

Question 7

Provinces with the highest retail sales in order are:

A) Ontario, British Columbia, Quebec, and Alberta
B) Ontario, Alberta, Quebec, and British Columbia
C) Alberta, Atlantic Canada, Ontario, British Columbia, and Quebec
D) Ontario, Quebec, Alberta, and British Columbia
E) Quebec, British Columbia, Prairies, Ontario, and Atlantic Canada

Question 8

Retail managers must make complex decisions including all of the following except:

A) Target markets
B) Retail locations
C) Merchandise and services offerings
D) Mission statement
E) Training and motivating sales associates

Question 9

______________ is when a firm performs more than one set of activities in the channel.

A) Channel diversification
B) Distribution channel
C) Horizontal integration
D) Vertical development
E) Vertical integration

Question 10

A retailer's role in the distribution channel is to:

A) act as the liaison between manufacturers and wholesalers
B) buy merchandise exclusively from the manufacturers
C) negotiate with consumers through a series of focus groups
D) satisfy the needs of the consumers
E) sell to wholesalers

Question 11

Why is it advantageous for retailers to be vertically integrated?

A) Retailers can develop unique merchandise sold only in their stores
B) Retailers can expand their services easily to the Internet because they can direct orders to the manufacturer
C) Retailers have realized that to stay competitive, they must become vertically integrated
D) Customers prefer retailers who are vertically integrated
E) Retailers can develop unique merchandise sold only in their stores; retailers can expand their services easily to the Internet because they can direct orders to the manufacturer; retailers have realized that to stay competitive, they must become vertically integrated; and customers preferring retailers that are vertically integrated are all advantages.

Question 12

A credit union holds and maintains detailed records of the banking activities of its members.Each quarter,the credit union provides its members a printout of banking activities,information about low rate loans and pre-owned automobiles.By contacting its members on a regular basis,the credit union is engaging in the business function of:

A) breaking bulk
B) holding inventory
C) providing assortments
D) providing services
E) financing

Question 13

Prior Snowboards located in Whistler,B.C.manufactures many of the snowboards it sells in its retail outlet at its own factory in Canada.Prior Snowboards is practicing:

A)demographic marketing
B)globalization
C)product-related marketing
D)vertical integration
E)wholesaling

Question 14

If a chain of florist shops opened a plant nursery to provide gift plants and cut flowers to all of its outlets within a 300-mile radius,the chain would be practicing:

A) vertical integration
B) channel expansion
C) horizontal expansion
D) vertical retailing
E) service marketing

Question 15

One of the functions retailers undertake to increase the customer's perception of value is providing services.Which of the following would be an example of that activity?

A) Clean washrooms
B) Payment by debit cards
C) Trained salespeople to answer questions
D) Well-lit parking lots
E) Clean washrooms, payment by debit cards, trained salespeople, and well-lit parking lots are all appropriate examples.

Question 16

Which of the following statements about retailers holding inventory is false?

A) By having inventory held in the store, consumers can hold less merchandise at home
B) By holding inventory, retailers can decrease the visual merchandising expenditure
C) Holding inventory in a store helps serve the customer's needs
D) Retailers keep inventory so that products are available when consumers want them
E) Holding inventory reduces consumer's cost of storing products

Question 17

Providing assortments is an advantageous business activity because it:

A) enables the company to create a more informational and entertaining environment which would promote more sales
B) enables the company to reinvest savings
C) enables the customer to choose from a wide selection of brands, designs, sizes, and prices all in one store
D) enables the customer to save money by being able to shop in one store
E) enables the customer to stock up on the assortments because of their availability

Question 18

The largest sectors in terms of retail sales are:

A) General merchandise and Clothing
B) Pharmacies and Building supplies
C) Food, Beverage, and Automotive
D) Furniture and Pharmacies
E) Automotive and Building supplies

Question 19

One of the functions retailers undertake to increase the customer's perception of value is providing services.Which of the following would be an example of that activity?

A) Ignoring the competition
B) Increasing employee pilferage
C) Performing a situation analysis
D) Selling on the Internet as an additional channel
E) None of the available answers are correct.

Question 20

Consumers shop through multiple channels that include all of the following except:

A) Tablets
B) Computers
C) Web-enabled kiosks
D) Retail stores
E) Federal Express

Question 21

The offering of merchandise not typically associated with the store type is called:

A) channel conflict
B) intratype competition
C) product diversification
D) scrambled merchandising
E) vertical differentiation

Question 22

Once a retailer understands its environment,it needs to develop and implement a(n):

A) retail strategy
B) advertising plan
C) customer base
D) competitive strategy
E) functional strategy

Question 23

The intensity of competition is greatest among retailers when:

A) price dominates the retail mix
B) they are located near each other and offer similar retail offerings
C) they are located near each other and target the same customer
D) they are located far from each other and offer similar retail offerings
E) they are located far from each other and target the same customer

Question 24

When McDonald's opened its first restaurant,a hungry patron could order a hamburger,French fries and a shake.In those early years,McDonald's did not offer much:

A) assortment
B) product depth
C) quantity
D) value
E) variety

Question 25

What is Variety?

A) Variety is the number of different merchandise categories within a store
B) Variety is the number of different SKU's within a merchandise category
C) Variety is the number of different items in a category
D) Variety is another term for scrambled merchandising
E) Variety is the number of different facets of the business plan

Question 26

72 percent of all retail businesses employ fewer than ___________ persons.

A) 100
B) 50
C) 25
D) 10
E) 5

Question 27

Best Buy (electronics)and Future Shop (electronics)are what type of competitors?

A) indirect
B) intratype
C) intertype
D) vertical
E) horizontal

Question 28

Delia was delighted to see that the local Shoppers Drug Mart carried milk,bread,and snacking crackers.Her delight indicates she has never seen:

A) a deep product assortment
B) an acceptable merchandising mix
C) a retail mix
D) scrambled merchandising
E) this type of intratype competition

Question 29

The competition between the same types of retailers is called:

A) indirect competition
B) intertype competition
C) intratype competition
D) scrambled merchandising
E) vertical integration

Question 30

Chapters stores sell Godiva chocolates.By selling such products,Chapters is:

A) offering a good merchandise mix
B) offering what the market demands
C) offering deep product assortments
D) practicing intratype competition
E) practicing scrambled merchandising

Question 31

Increasing intertype competition has made it harder for retailers to identify their:

A) competition
B) target market
C) merchandise mix
D) retail mix
E) none of the answers provided are correct.

Question 32

Lydia owns the Shake Shack,a small ice cream shop on a busy beach boardwalk that specializes in a variety of milkshakes,malts and cones.She has identified her customer as a person walking on the boardwalk-mostly vacationers who want something cool and quick with no frills.She located herself close to parking for easy access,unlike some of her competitors.Lydia seems to have developed a strong:

A) business concept
B) business plan
C) location strategy
D) retail strategy
E) selling strategy

Question 33

Which business activities are undertaken by retailers?

A) Purchasing goods and services
B) Developing management information systems
C) Raising capital
D) Managing a sales force
E) All answers provided are correct.

Question 34

When developing the _________________ for his new salon,George decided to obtain a long-term competitive advantage over other salons by offering longer hours,better prices,a well trained staff and half-price perm day every Thursday to attract customers.

A) selling concept
B) business cycle
C) retail strategy
D) focal point orientation
E) marketing concept

Question 35

Scrambled merchandising increases:

A) vertical integration
B) intertype competition
C) concentric diversification
D) horizontal integration
E) intratype competition

Question 36

Walmart,Loblaws,and Future Shop are in what kind of competition?

A) channel
B) horizontal
C) indirect
D) intertype
E) intratype

Question 37

Which of the following would be an example of intertype competition?

A) A supermarket and a fresh flower stand
B) A specialty store and a department store
C) A department store and a pharmacy
D) A convenience store and a fast food restaurant
E) All answers provided are correct.

Question 38

Which of the following would be an intratype competitor for an IGA supermarket?

A) Walmart
B) Subway
C) Loblaws
D) Shoppers Drug Mart
E) Old Navy

Question 39

Which of the following would be an example of intratype competitors?

A) Walmart and Target
B) Sears and La Senza
C) IGA and Shoppers Drug Mart
D) Future Shop and eBay
E) Loblaws and Amazon.ca

Question 40

As part of a retailing strategy,a retailer looks to changes in demographics and responds to these changes with their retail mix.The following are examples of demographic trends except:

A) the growth of the elderly population
B) the increased emphasis on customer service
C) the growth of minority segments
D) the rising number of two-income families
E) the retirement of the Baby Boomers

Question 41

A video rental,the purchase of a book on Amazon.com,buying a George Foreman Grill after watching an infomercial and getting a pedicure are all examples of ________ activities-the sale of goods and services to the ultimate consumer.

Question 42

Which of the following parts of the retail mix can be utilized by a small hardware store?

A) Bright lighting in the store, which makes it easier to read the messages
B) A new ad campaign that uses both radio and newspaper media
C) Store location next door to a hospital
D) Attractive point-of-purchase displays at the ends of the store's aisles
E) All of these

Question 43

Once a well-articulated retail strategy has been developed,the next step is to:

A) override the control mechanism
B) evaluate the results of the strategy
C) forecast future environmental trends
D) implement the strategy
E) confirm that environmental conditions have not changed

Question 44

A business philosophy and set of strategies,programs,and systems that focus on identifying and building loyalty with a firm's most-valued customers is called:

A) customer decision area
B) customer loyalty
C) customer relationship management
D) intratype competition
E) strategizing

Question 45

How are retailers using point-of-sale (POS)terminals and Universal Product Codes (UPCs)affixed to merchandise? As a way to:

A) target the distribution plan
B) create an advertising plan
C) check its location strategy
D) gain a strategic advantage
E) set its retailing objectives

Question 46

Retailers are the final business in a distribution channel that link manufacturers to _______.

Question 47

A(n)_____ is a business that sells products and services to ultimate consumers.

Question 48

When a retailer like Roots designs merchandise as well as sells the merchandise,_________ is occurring.

Question 49

Which of the following is part of a retailer's retail mix?

A) Advertising
B) Displays
C) Trained salespeople
D) Services offered
E) All of these

Question 50

Retailers face ethical issues on a regular basis.The following are all TRUE except:

A) Offering bribes to overcome bureaucratic roadblocks is globally recognized as an unaccepted practice.
B) Some years ago, doctors and lawyers who advertised their services in Canada were considered unethical.
C) Offering bribes to overcome bureaucratic roadblocks is illegal in Canada.
D) Ethics are the principles governing the behaviour of individuals and companies to establish appropriate behaviour and indicate what is right and wrong.
E) Today, advertising by doctors and lawyers in Canada is considered legal.

Question 51

A(n)_____________ is a set of businesses that move products from the point of production to the point of sale to the ultimate consumer.

Question 52

Which of the following is not a part of the retail mix for a furniture store?

A) Competitive response
B) Furniture assortments
C) The location of the store
D) Store credit card
E) Television commercials

Question 53

To implement a retail strategy,management must:

A) develop a retail mix that satisfies the needs of its target market better than its competitors
B) locate the ideal location
C) develop budgets and acquire merchandise
D) set pricing strategies and determine promotions
E) determine its target market and set retail objectives

Question 54

As the owner of a store specializing in men's suits,Isabella can use a retail strategy statement to identify all of the following except:

A) the shop's target market
B) the advertising campaign developed to sell last season's merchandise
C) how the store will build a competitive advantage
D) what services the shop will offer its customers
E) what types of suits the store will stock

Question 55

Which of the following statements about location strategy is true?

A) Location is the second most important characteristic that consumers examine when selecting a store
B) Location offers an opportunity to gain a long-term advantage over competitors
C) Consumers do not use convenience as a basis for selecting where to shop
D) Location can never be used to gain any kind of long-term advantage over competitors due to retailing's low entry barriers
E) The only two characteristics more important than location in the selection process of where to shop are price and sales promotions

Question 56

The combination of factors retailers use to satisfy customer needs and influence their purchase decisions is called the firm's:

A) retailing concept
B) retail mix
C) marketing concept
D) target market
E) none of these

Question 57

The key strategic elements of the retail strategy are:

A) financial strategies
B) organizational structures
C) location strategies
D) market strategies
E) all of these

Question 58

To implement a retail strategy,a retailer must develop a _____ that satisfies the needs of its target market better than its competitors.

A) production orientation
B) horizontal integration
C) sales orientation
D) retail mix
E) situation analysis

Question 59

Which of the following is not an element in the retail mix?

A) Competitive response
B) Merchandise assortments
C) Location
D) Customer service
E) Advertising and promotion

Question 60

_________________________ means that a firm performs more than one set of activities in the channel,such as investments by retailers in wholesaling or manufacturing.

Question 61

List the four functions performed by retailers.

Question 62

How do retailers increase the value consumers receive from their purchases?

Question 63

When Austin saw pastries and coffee at his local bookstore,he knew it was an example of _______,which is the juxtaposition of unrelated merchandise in the store.

Question 64

Why do retailers use point-of-sale (POS)terminals to read Universal Product Codes (UPCs)and electronic data interchange (EDI)to send sales and inventory information from computer to computer?

Question 65

The philosophy,strategies,programs,and systems that focus on identifying and building loyalty with a retailer's most-valued customers are called ____________.

Question 66

Best Buy purchases many of the CDs,PlayStation 2 games,DVDs and DVD players by the truckload,then sells them in smaller quantities to its stores where consumers are allowed to buy them one at a time.What business function is Best Buy performing?

Question 67

By providing assortments,breaking bulk,holding inventory and providing services,retailers increase the ___________ consumers receive from their products and services.

Question 68

Distinguish between intratype competition and intertype competition.Give an example of each.

Question 69

A chef wants to open a Chinese restaurant in the suburbs of a large city.How should she identify the competition?

Question 70

What are the three things identified by a retail strategy statement?

Question 71

Why do retailers consider customers as important when developing a retail strategy?

Question 72

Scrambled merchandising increases _______ which occurs between retailers that sell similar merchandise using different formats,such as discount and department stores.

Question 73

When is the intensity of competition between retail stores the greatest?

Question 74

With manufacturers legally able to sell direct from the factories,why should retailers exist?

Question 75

The Reptile Shop is a pet shop that focuses on reptiles and their accoutrements for reptile lovers.The shop carries aquariums,warming rocks,toys and even live mice and crickets.It sponsors a reptile club where members can bring their pet to share with other reptile lovers.The store provides an inexpensive veterinary service.It even has a 3-month guarantee when you purchase a baby reptile.The Reptile Shop has created loyalty from its customers and continuously attracts new ones because of the services offered.What does this describe?

Question 76

Target and the Walmart are _________ (type of)competitors.

Question 77

What type of merchandising increases intertype competition?

Question 78

Why is location strategy important for both consumers and for competitive reasons?

Question 79

What is the retailer's role in the distribution channel?

Question 80

Why would a drug store add novelty gifts,fresh bread,pre-wrapped sandwiches and milk to its product mix?