TRUE/FALSE QUESTIONS Answer whether the following statements are true or false
1 Discuss the importance of retailing in the Canadian economy
2 Explain the dimensions by which retailers can be classified
2. Sales minus the cost of goods sold will give a retailer's net income. true false
3 Describe the major types of retail operations
3. Plingers is a retailing establishment. At Plingers, Mario is the buyer for ladies' shoes and develops promotions for the shoe lines as well as purchasing them. Tina is the buyer for all luggage products; she has similar promotional responsibilities and also is responsible for her personnel. Plingers is most likely a department store. true false 4. The Sock Stop is a retail store with a narrow assortment of merchandise (socks and hosiery) and with great depth in its product line. The Sock Stop is a specialty store. true false 5. Jon Schommer owns a neighborhood pharmacy. He is considering offering other profitable items that customer sometimes ask for, including snack foods, diapers, cosmetics, greeting cards, and magazines. This would be an example of multibrand merchandising. true false 6. Factory outlets are called "category killers" because they dominate the competition in their narrow merchandise segment. true false
3. Plingers is a retailing establishment. At Plingers, Mario is the buyer for ladies' shoes and develops promotions for the shoe lines as well as purchasing them. Tina is the buyer for all luggage products; she has similar promotional responsibilities and also is responsible for her personnel. Plingers is most likely a department store. true false
4. The Sock Stop is a retail store with a narrow assortment of merchandise (socks and hosiery) and with great depth in its product line. The Sock Stop is a specialty store. true false
5. Jon Schommer owns a neighborhood pharmacy. He is considering offering other profitable items that customer sometimes ask for, including snack foods, diapers, cosmetics, greeting cards, and magazines. This would be an example of multibrand merchandising. true false
6. Factory outlets are called "category killers" because they dominate the competition in their narrow merchandise segment. true false
4 Discuss nonstore retailing techniques
7. Cindee sells cosmetics through her web site and via a 1-800 number. Cindee practices direct-response marketing. true false
6 List the major tasks involved in developing a retail marketing strategy
8. The six Ps of retailing are product, price, promotion, place, packaging, and presentation. true false
8 Discuss future trends in retailing
9. In the future, the Swamp Supermarket can expect to focus on marketing produce items as part of a "solutions" package, because staple goods will be home-delivered rather than shopped for. true false
MULTIPLE-CHOICE QUESTIONS Select the response that best answers the question, and write the corresponding letter in the space provided.
11. A store's gross margin is: a. the final profit after all expenses are subtracted from revenue. b. the cost of merchandise from suppliers. c. the marketing expenses as a percentage of sales. d. the net sales as a percentage of gross sales. e. the percentage of sales after cost of goods is subtracted.
12. The Perfect Pet Parlor is a chain of stores selling a large selection of pet food and pet accessories at a high margin with excellent sales support. The store would most likely be classified as a: a. hypermarket b. convenience store c. warehouse membership club d. specialty store e. mass merchandiser 13. Waygro is a large, departmentalized, self-service retailer that specializes in wide assortments of foodstuffs and limited nonfood items. Waygro is a: a. mass merchandiser b. convenience store c. warehouse membership club d. discount store e. supermarket 14. Loblaws, Miracle Mart, and other supermarkets offer a variety of nontraditional goods and services such as video rental, flower shops, dry cleaning, and banking. This practice is called: a. convenience merchandising b. retail wheeling c. scrambled merchandising d. trade-up positioning e. specialty service 15. The Muffy Mart utilizes a strategy of setting low prices on large quantities of products and then uses daily television advertisements to stimulate a high turnover of inventory. Muffy Mart also offers a wide variety of product lines. Muffy Mart is a: a. mass merchandiser b. factory outlet c. convenience store d. wheel of retailing e. specialty store 16. Smart-Sam's has opened a new store, even larger than its largest supermarket. This new store is over 200,000 square feet and combines a supermarket and discount department store. The store must generate a volume of over $1,000,000 per week in sales just to break even. This new store is a: a. mass merchandiser b. warehouse membership club c. hypermarket d. discount store e. factory outlet 17. SoundSensation offers stereo equipment and accessories. It has a deep assortment and low prices. The store is operated on a self-service, no-frills concept. SoundSensation is a: a. specialty store b. factory outlet c. warehouse membership club d. discount specialty store e. discount store 18. Jill buys many of the office supplies for her income tax preparation business at a retailer that stocks a limited selection of items, which are sold in bulk on a cash-and-carry basis to members only. She browses through a huge store that has a warehouse atmosphere. She buys computer paper, pencils, a small copy machine, and a television for her waiting area. Jill is shopping at a(n): a. off-price discount retailer b. factory outlet c. warehouse membership club d. industrial supply warehouse e. hypermarket 19. The Waverly Wear clothing company has to find a way to dispose of its overrun and unsold end-of-season clothes. As a marketing consultant, you suggest that they either open a factory outlet store or sell the merchandise to a(n): a. off-price discount retailer b. hypermarket c. department store d. supermarket e. mass merchandiser 20. The American Tourister Luggage Company has decided that the most profitable way to dispose of out-of-season and irregular stock would be to open a store and sell its own merchandise in a remote location. This is the retail strategy of: a. hypermarkets b. mass merchandisers c. discount stores d. factory outlets e. bargain basements
12. The Perfect Pet Parlor is a chain of stores selling a large selection of pet food and pet accessories at a high margin with excellent sales support. The store would most likely be classified as a: a. hypermarket b. convenience store c. warehouse membership club d. specialty store e. mass merchandiser
13. Waygro is a large, departmentalized, self-service retailer that specializes in wide assortments of foodstuffs and limited nonfood items. Waygro is a: a. mass merchandiser b. convenience store c. warehouse membership club d. discount store e. supermarket
14. Loblaws, Miracle Mart, and other supermarkets offer a variety of nontraditional goods and services such as video rental, flower shops, dry cleaning, and banking. This practice is called: a. convenience merchandising b. retail wheeling c. scrambled merchandising d. trade-up positioning e. specialty service
15. The Muffy Mart utilizes a strategy of setting low prices on large quantities of products and then uses daily television advertisements to stimulate a high turnover of inventory. Muffy Mart also offers a wide variety of product lines. Muffy Mart is a: a. mass merchandiser b. factory outlet c. convenience store d. wheel of retailing e. specialty store
16. Smart-Sam's has opened a new store, even larger than its largest supermarket. This new store is over 200,000 square feet and combines a supermarket and discount department store. The store must generate a volume of over $1,000,000 per week in sales just to break even. This new store is a: a. mass merchandiser b. warehouse membership club c. hypermarket d. discount store e. factory outlet
17. SoundSensation offers stereo equipment and accessories. It has a deep assortment and low prices. The store is operated on a self-service, no-frills concept. SoundSensation is a: a. specialty store b. factory outlet c. warehouse membership club d. discount specialty store e. discount store
18. Jill buys many of the office supplies for her income tax preparation business at a retailer that stocks a limited selection of items, which are sold in bulk on a cash-and-carry basis to members only. She browses through a huge store that has a warehouse atmosphere. She buys computer paper, pencils, a small copy machine, and a television for her waiting area. Jill is shopping at a(n): a. off-price discount retailer b. factory outlet c. warehouse membership club d. industrial supply warehouse e. hypermarket
19. The Waverly Wear clothing company has to find a way to dispose of its overrun and unsold end-of-season clothes. As a marketing consultant, you suggest that they either open a factory outlet store or sell the merchandise to a(n): a. off-price discount retailer b. hypermarket c. department store d. supermarket e. mass merchandiser
20. The American Tourister Luggage Company has decided that the most profitable way to dispose of out-of-season and irregular stock would be to open a store and sell its own merchandise in a remote location. This is the retail strategy of: a. hypermarkets b. mass merchandisers c. discount stores d. factory outlets e. bargain basements
21. Which of the following is NOT an example of nonstore retailing? a. An Avon sales person sells cosmetics in an office setting. b. L.L. Bean sells clothing through catalogue sales. c. A famous chef sells her pasta sauce in her restaurant. d. The Shopping Network sells jewellery through television. e. PC Flowers sells flower arrangements on-line. 22. BigFoote sells its hunting and hiking boots through catalogues in the mail. This retailing technique is known as: a. online retailing b. direct marketing c. franchising d. vending e. in-home retailing 23. The Super Shoppe has decided to display products on a cable television channel and encourage shoppers to call a toll-free number to purchase the merchandise with a credit card. This form of retailing is called a(n): a. in-store electronic shopping technique b. online method c. electronic point of sale d. shop-at-home network e. catalogue viewing
21. Which of the following is NOT an example of nonstore retailing? a. An Avon sales person sells cosmetics in an office setting. b. L.L. Bean sells clothing through catalogue sales. c. A famous chef sells her pasta sauce in her restaurant. d. The Shopping Network sells jewellery through television. e. PC Flowers sells flower arrangements on-line.
22. BigFoote sells its hunting and hiking boots through catalogues in the mail. This retailing technique is known as: a. online retailing b. direct marketing c. franchising d. vending e. in-home retailing
23. The Super Shoppe has decided to display products on a cable television channel and encourage shoppers to call a toll-free number to purchase the merchandise with a credit card. This form of retailing is called a(n): a. in-store electronic shopping technique b. online method c. electronic point of sale d. shop-at-home network e. catalogue viewing
24. The retailing mix consists of all of the following EXCEPT: a. packaging b. product c. presentation d. place e. price 25. The Greenhouse Exotique has decided that consumers will be drawn to its offering of rare and specialty plants. The store's manager believes that consumers will be willing to drive out of their way to buy these plants. The company needs to keep its overhead costs (such as rent) low and wants to avoid locating near competing nurseries and plant stores. For a location the Greenhouse Exotique will probably choose a: a. factory outlet b. freestanding store c. strip centre d. shopping centre e. regional mall 26. Erich wants to open a small, specialty toy store and is considering locating it in a regional shopping mall. He should know that: a. parking is usually inadequate b. the leases required are usually inexpensive c. his store could be the mall anchor d. the mall atmosphere and other stores will help attract shoppers e. there is usually a problem with image because malls have no unified image, as a shopping centre does 27. Sears and The Bay are two anchor stores and therefore: a. are most likely large department stores that are located at opposite ends of a mall to create a heavy pedestrian traffic flow b. are the stores within the mall that sell services rather than products c. probably specialize in high-priced items like furniture d. are supermarkets that are located within shopping malls e. are retail stores that "drop off" to freestanding locations 28. Beach Bums is a new, trendy store that specializes in swimwear and beach accessories. The store is decorated in neon colours, is full of potted palm trees, has sand on the floor, and plays beach music in the background. These factors are used to create the store's: a. cultural impact b. merchandise mix c. target strategy d. atmosphere e. promotional strategy 29. Assume you are the manager of a retail store and you are currently deciding your store's service level. Which of the following is NOT an issue for you to consider for retail service level? a. browsing patterns of the consumers b. the service offered by the competition c. type of merchandise handled d. socioeconomic characteristics of the target market e. cost of providing the service
24. The retailing mix consists of all of the following EXCEPT: a. packaging b. product c. presentation d. place e. price
25. The Greenhouse Exotique has decided that consumers will be drawn to its offering of rare and specialty plants. The store's manager believes that consumers will be willing to drive out of their way to buy these plants. The company needs to keep its overhead costs (such as rent) low and wants to avoid locating near competing nurseries and plant stores. For a location the Greenhouse Exotique will probably choose a: a. factory outlet b. freestanding store c. strip centre d. shopping centre e. regional mall
26. Erich wants to open a small, specialty toy store and is considering locating it in a regional shopping mall. He should know that: a. parking is usually inadequate b. the leases required are usually inexpensive c. his store could be the mall anchor d. the mall atmosphere and other stores will help attract shoppers e. there is usually a problem with image because malls have no unified image, as a shopping centre does
27. Sears and The Bay are two anchor stores and therefore: a. are most likely large department stores that are located at opposite ends of a mall to create a heavy pedestrian traffic flow b. are the stores within the mall that sell services rather than products c. probably specialize in high-priced items like furniture d. are supermarkets that are located within shopping malls e. are retail stores that "drop off" to freestanding locations
28. Beach Bums is a new, trendy store that specializes in swimwear and beach accessories. The store is decorated in neon colours, is full of potted palm trees, has sand on the floor, and plays beach music in the background. These factors are used to create the store's: a. cultural impact b. merchandise mix c. target strategy d. atmosphere e. promotional strategy
29. Assume you are the manager of a retail store and you are currently deciding your store's service level. Which of the following is NOT an issue for you to consider for retail service level? a. browsing patterns of the consumers b. the service offered by the competition c. type of merchandise handled d. socioeconomic characteristics of the target market e. cost of providing the service
7 Discuss the challenges of expanding retailing operations into global markets
30. Which of the following statements would NOT explain why retailing has become global? a. Communication technology has homogenized tastes and preferences throughout the world. b. Trade barriers and tariffs have been lowered. c. Many markets in the underdeveloped world have vast sales potential. d. Retailers around the world have been merging and creating global retail chains. e. Marketers have become very savvy about how to conduct market research in other countries.
31. The Future Shop is interested in global retailing. The Future Shop is most likely to be successful in this endeavour with a: a. product and trade name franchise b. megamall with multiple department store anchors c. mail-order catalogue d. specialty store chain e. hypermart
