Which of the following best explains why new retailers often squeeze out older retailers?
A) retail borrowing
B) the wheel-of-retailing hypothesis
C) shrinkage
D) pop-up retailing
E) pyramid schemes

Question

Quizplus · Accepted Answer

The wheel-of-retailing hypothesis suggests that new retailers often enter the market with low prices and low service levels, but over time, as they gain experience and build their reputation, they increase their prices and service levels. This creates opportunities for newer, low-price, low-service retailers to enter the market and attract customers away from older retailers who have already increased their prices and service levels. Essentially, the cycle continues, resulting in the "squeezing out" of older retailers.

Which of the Following Best Explains Why New Retailers Often