Deck 14: Retailing and Wholesaling

Question 1

Retailing's economic value is represented by the people employed in retailing as well as by

A)the total amount of money exchanged in retail sales.
B)price asked for any one item for sale.
C)the elimination of global boundaries.
D)the cost of goods sold.
E)the net return on capital.

Answer 1

A

Question 2

"Cyber Monday" takes place on

A)the Monday immediately before Thanksgiving when on-line stores get the jump on traditional retail stores' Black Friday.
B)the first Monday of each month when online retailers drop prices from the previous week.
C)the first Monday after Thanksgiving when consumers shop from their broadband connections at work on their first day back after the holiday.
D)New Years Day when traditional stores are all closed and online stores sell more than retail stores.
E)Labor Day in order to capitalize on shoppers who are on holiday and can take advantage of great sales without worrying about crowds or traffic.

Answer 2

C

Question 3

One of the best-run banks in the United States, Wells Fargo reaches retail customers through 3,339 branch banks, 561 in-store mini banks, a worldwide network of 6,960 ATMs, and its online banking service.The online service has millions of users.Which utility does Wells Fargo best provide in this example?

A)time
B)form
C)place
D)possession
E)performance

Answer 3

C

Question 4

The Sports Authority is a sporting goods superstore that provides year-round inventory of equipment for just about any sport you can name.Even during the "off season" of seasonal sports, equipment is available at the Sports Authority.Which utility does the Sports Authority best provide in this example?

A)time
B)form
C)convenience
D)possession
E)performance

Question 5

The ability to shop over the Internet 24/7 provides consumers with __________ utility.

A)form
B)time
C)convenience
D)possession
E)performance

Question 6

Retailing is an important marketing activity.Not only do producers and consumers meet through retailing actions, but retailing also creates __________ and has a significant impact on the economy.

A)the nation's largest source of tax revenues
B)a sense of local community
C)public service to charities
D)harvesting possibilities
E)customer value

Question 7

The purpose of the OfficeMax "Elf Yourself" program which allows visitors to e-mail an animated elf to friends is to

A)encourage computer users to drive traffic to the OfficeMax Web site.
B)subliminally connect their elves to Christmas elves, which would tempt customers to shop not just for themselves but for others.
C)encourage people to let their "elves" help them make their way through the OfficeMax web site.
D)create a more people-friendly connection to the OfficeMax name which is often tied to an image of a business supply store rather than a store for personal needs.
E)connect the diminutive size of elves to the "smaller" ticket items that can be used as "stocking stuffers."

Question 8

At the Christmas Tree Shop, customers can shop for Christmas gifts at any time of year.What type of utility does this store primarily create for its customers?

A)place and conformance
B)possession and form
C)performance
D)time
E)form

Question 9

All activities involved in selling, renting, and providing goods and services to ultimate consumers for personal, family, or household use are referred to as _________.

A)manufacturing
B)wholesaling
C)facilitating
D)retailing
E)logistics

Question 10

One reason for the growth of Cyber Monday and online shopping in general is

A)large retailers such as Amazon, Home Depot and Wal-Mart have given online shopping a lot of visibility.
B)Internet shopping is safer since no one can access your personal information.
C)people feel they won't be tempted to overspend online the way they do in traditional stores.
D)people know that if they purchase online they will automatically get tons of offers from similar online merchants.
E)online prices are traditionally lower since it is so easy to "shop the competition."

Question 11

One reason for the growth of Cyber Monday and online shopping in general is

A)Internet shopping is safer since no one can access your personal information.
B)people feel they won't be tempted to overspend online the way they do in traditional stores.
C)many retailers now move their Friday in-store sales and promotions to their Web sites on Monday.
D)people know that if they purchase online they will automatically get tons of offers from similar online merchants.
E)online prices are traditionally lower since it is so easy to "shop the competition."

Question 12

Retailing refers to

A)all activities involved in the selling of tangible goods to ultimate consumers for personal, family, or household use.
B)all activities involved in the selling of tangible goods to ultimate consumers for personal, household, or industrial use.
C)all activities involved in the selling, renting, leasing, or reselling of goods and services to ultimate consumers or small industrial users.
D)all activities involved in selling, renting, and providing goods and services to ultimate consumers for personal, family, or household use.
E)all activities involved in selling, renting, and providing goods and services without taking direct title to the goods.

Question 13

"Black Friday" originally, referred to

A)the day your salary exceeds the taxes owed and the remaining salary becomes "your own."
B)the first time the stock market dropped by more than ten percent (it occurred on a Friday, hence its name).
C)the first time the stock market crashed (it occurred on a Friday, hence its name).
D)an accounting term used to suggest when retailers finally became profitable.
E)the first time Friday's post-Thanksgiving sales failed to meet projected levels.

Question 14

Enterprise car rental agency differentiates itself from other similar agencies by providing a delivery service.This delivery service is particularly valuable to someone who has been left stranded without transportation.By making it easy to rent temporary transportation, Enterprise is emphasizing which utility?

A)form
B)product
C)service
D)possession
E)convenience

Question 15

The four utilities offered to consumers through retailing are

A)time, place, form, and possession.
B)product, price, place, and promotion.
C)form, possession, time, and performance.
D)convenience, consistency, competition, and choice.
E)convenience, performance, possession, and form.

Question 16

Mpire.com helps consumers by

A)tracking consumers' favorite purchases and alerting them by e-mail whenever something they're planning to buy goes on sale.
B)providing a visual search engine the finds products that are similar in appearance by allowing customers to draw a box around the product or part of the product they like.
C)tracking the price of products like TVs, clothing, and books to let consumers know if prices are increasing or decreasing.
D)immediately notifying collectors if anything in the collectors' "find" list is advertised for sale on the web.
E)calculating the value of used products, offering users a price for the product, and even sending a box to mail it.

Question 17

One reason for the growth of Cyber Monday and online shopping in general is

A)prices are almost always lower online since there is greater competition.
B)people feel they won't be tempted to overspend online the way they do in traditional stores.
C)Internet shopping is safer since no one can access personal information.
D)the number of fast Internet connections in homes and businesses has grown to about 100 million.
E)people know that if they purchase online they will automatically get tons of offers from similar online merchants.

Question 18

Retailing's economic value is represented by __________ as well as by the total amount of money exchanged in retail sales.

A)the price asked for any one item for sale
B)the elimination of global boundaries
C)the people employed in retailing
D)the net return on capital
E)the cost of goods sold

Question 19

The __________ provided by retailers create value for consumers.

A)utilities
B)logistics
C)synergies
D)format
E)service functions

Question 20

Gazelle.com helps consumers by

A)tracking consumers' favorite purchases and alerting them by e-mail whenever something they're planning to buy goes on sale.
B)providing a visual search engine the finds products that are similar in appearance by allowing customers to draw a box around the product or part of the product they like.
C)tracking the price of products like TVs, clothing, and books to let consumers know if prices are increasing or decreasing.
D)immediately notifying collectors if anything in the collectors' "find" list is advertised for sale on the Web.
E)calculating the value of used products, offering users a price for the product, and even sending a box to mail it.

Question 21

There are three general forms of retail ownership: individual, corporate chain, and _________.

A)dual ownership
B)contractual system
C)industry consortiums
D)multi-national cartel
E)non-binding cooperative

Question 22

Which method of classifying retail outlets would be most appropriate for describing all franchise operations?

A)form of ownership
B)level of service
C)merchandise line
D)method of operation
E)revenue generated

Question 23

Your local Safeway grocery store is likely to be categorized according to what type of retailer outlet?

A)form of ownership
B)level of service
C)merchandise line
D)method of operation
E)revenue generated

Question 24

Environmental consciousness among consumers has reached an all time high.Many retailers have responded not only out of concern for the environment, or their company image or reputation, but because

A)governmental mandates have required it.
B)sustainability has become a major element in competition between firms.
C)environmental initiatives save retailers money.
D)a consortium of environmental groups has created a non-compliant boycott list.
E)there is greater availability of green products and services.

Question 25

There are three key methods of classifying retail operations:

A)method of operation, revenue generated, and merchandise line.
B)form of ownership, method of operation, and merchandise line.
C)form of ownership, level of service, and merchandise line.
D)level of service, merchandise line, and revenue generated.
E)merchandise line, form of ownership, and revenue generated.

Question 26

Which of the following is a commonly used method of classifying retail outlets?

A)proportion of national brands carried
B)service versus product
C)form of ownership
D)revenue generated
E)profitability

Question 27

Four of the 28 largest businesses in the United States are retailers which include: Walmart, Costco, Home Depot, and _________.

A)Sears
B)Target
C)Best Buy
D)JCPenny
E)Bloomingdale

Question 28

Electronics retailer Best Buy recently began using __________ in some of its stores with the goal of reducing CO2 emissions by 8 percent by 2012.

A)wind power
B)solar energy
C)biodegradable fuel
D)lithium powered energy cells
E)biodegradable emissions filters

Question 29

Albertson's Supermarket accepts debit and credit cards as well as cash and checks for purchases.Its acceptance of various forms of payment provides its customers with __________ utility.

A)time
B)place
C)possession
D)form
E)public

Question 30

Walmart's $408 billion of sales in 2009 surpassed the gross domestic product of all but __________ countries for that same year.

A)5
B)12
C)18
D)27
E)50

Question 31

The degree of service provided to the customer from three types of retailers: self-, limited-, and full-service.This retail classification is referred to as _________.

A)involvement
B)level of service
C)service commitment
D)customer obligation
E)degree of commitment

Question 32

A method of classification that describes retail outlets based on whether individuals, corporate chains, or contractual systems possess the outlet is referred to as _________.

A)product involvement
B)service level
C)merchandise line
D)product assortment
E)form of ownership

Question 33

A restaurant that offers food made exactly to each customer's preference is providing its customers with __________ utility.

A)time
B)place
C)form
D)possession
E)product

Question 34

A method of classification that describes how many different types of products a store carries and in what assortment is referred to as _________.

A)product involvement
B)product assortment
C)merchandise line
D)service level
E)store design

Question 35

Outside the United States, large retailers include __________ in Japan, Carrefour in France, Metro Group in Germany, and Tesco in Britain.

A)Daiei
B)Seebi
C)Toshi
D)Toshei
E)Goshen

Question 36

Saturn dealers have adopted a "no-hassle, no-haggle" sales policy that eliminates the need for negotiating.Instead, all customers are offered the same price.Test drives, financing, trade-ins, and leasing are all offered to encourage customers to purchase a Saturn.Which utility does Saturn best provide in this example?

A)product
B)form
C)convenience
D)service
E)possession

Question 37

When Home Depot switched its in-store light fixture displays to compact fluorescent light bulbs it saved __________ per year.

A)$16 million
B)$24 million
C)$29 million
D)$31 million
E)$42 million

Question 38

When consumers learned that food packaging creates __________ percent of all household waste they added packaging to their purchase decision criteria.

A)30
B)35
C)40
D)45
E)50

Question 39

A method of classification that describes the degree of service provided to the customer is referred to as _________.

A)product involvement
B)product assortment
C)merchandise line
D)form of ownership
E)service level

Question 40

Level of service is used to describe the degree of service provided to the customer.Three levels of service provided by retailers include: self-, _________-, and full-service retailers.

A)commitment
B)involvement
C)limited
D)obligation
E)pledge

Question 41

Bon Marche, Lazurus, Burdines, Famous Barr, Filenes, Foleys, and now 40 Bloomingdale's are all part of __________ corporate chain.

A)Dillard's
B)Macy's
C)Target's
D)Walmart's
E)Saks Fifth Avenue

Question 42

One way neighborhood grocers can take advantage of volume discounts commonly available to chains is to

A)purchase a franchise membership.
B)become a subsidiary of a larger chain.
C)join a professional merchant association and hire legal counsel.
D)create a grocery networking system to exchange coupon vouchers.
E)participate in a retailer-sponsored cooperative with other independent grocers.

Question 43

The three basic types of contractual system are:

A)retailer-sponsored cooperatives, wholesaler-sponsored voluntary chains, and franchises.
B)dual ownership agreements, industry consortiums, and non-binding cooperatives.
C)wholesaler-sponsored voluntary chains, non-binding cooperatives, and franchises.
D)dual ownership agreements, industry consortiums, and multi-national cartels.
E)non-binding, binding, and in perpetuity.

Question 44

Neighborhood grocers that ban together with several other independent grocers who all agree to buy their goods directly from food manufacturers are a form of

A)contractual system.
B)consortium system.
C)administrative system.
D)conglomerate system.
E)collaborate chain.

Question 45

Your neighborhood dry cleaner or florist is likely to be categorized according to its form of retail ownership as an independent retailer.This means it is owned by a(n) _________.

A)individual
B)consortium
C)corporation
D)cooperative
E)conglomerate

Question 46

There are three general forms of retail ownership: contractual system, individual, and _________.

A)industry consortiums
B)non-binding cooperative
C)multi-national cartel
D)dual ownership
E)corporate chain

Question 47

In a(n) __________ system an individual or firm contracts with a parent company to set up a business or retail outlet.

A)administered system
B)franchise system
C)vertically integrated chain
D)retail-sponsored cooperative
E)corporate system

Question 48

There are three general forms of retail ownership: contractual system, corporate chain, and _________.

A)individual
B)dual ownership
C)industry consortiums
D)non-binding cooperative
E)multi-national cartel

Question 49

One of the most common forms of retail ownership is the __________ business owned by a person.

A)corporate chain
B)consumer cooperative
C)contractual system
D)independent retailer
E)administered system

Question 50

Franchising is a type of _________.

A)administered system
B)contractual system
C)corporate system
D)vertically integrated chain
E)retail-sponsored cooperative

Question 51

What type of contractual system describes a situation where assistance in selecting the location, setting up the store or facility, advertising, and training personnel is provided?

A)administered system
B)franchising system
C)conglomerate system
D)vertical integrated system
E)retail-sponsored cooperative

Question 52

Independently owned stores that band together to act like a chain is referred to as _________.

A)franchises
B)corporate chains
C)contractual systems
D)operative marketing systems
E)regional shopping centers

Question 53

A form of ownership that involves multiple outlets under common ownership is referred to as a(n)

A)corporate chain.
B)contractual system.
C)independent retailer.
D)administered system.
E)consumer cooperative.

Question 54

The acronym RFID stands for

A)retail franchise identification designation.
B)required financial identification.
C)real frequency identification.
D)radio frequency identification.
E)retail federation of independent department stores.

Question 55

Most of the 1.1 million retail establishments in the United States including hardware stores, convenience stores, clothing stores, and computer and software stores are owned by __________.

A)corporate chains
B)contractual systems
C)independent retailers
D)conglomerate
E)multinationals

Question 56

Which of the following statements regarding corporate chains is most accurate?

A)Corporate chains are multiple outlets under common ownership.
B)Corporate chains usually avoid using centralized decision making.
C)Corporate chains generally own most if not all of their suppliers so they do not have to negotiate for price.
D)Consumers have fewer choices in merchandise since all buying decisions are made unilaterally.
E)Corporate chains offer the least benefit to consumers since they are the farthest removed from the ultimate consumer.

Question 57

Consumers benefit in dealing with chains because

A)corporate chains have more experience than other forms of retailers.
B)they can own stock in the same company where they shop since corporate chain stock must be publically traded.
C)they can establish a credit history more easily that with other forms of retailers.
D)there are multiple outlets with similar merchandise and consistent management policies.
E)they have less stress in making decisions since merchandise is arranged and displayed by professional designers.

Question 58

More than __________ of all retail establishments have four or fewer employees.

A)10%
B)20%
C)30%
D)40%
E)50%

Question 59

Walmart has developed a sophisticated inventory management and cost control system that allows rapid price changes for each product in the store.They also use technologies such as __________ to improve the quality of information available about products.

A)radio frequency identification
B)encapsulation techniques
C)bar code scanners
D)nanotechnology
E)cookies

Question 60

In which form of retail outlet would customers most likely be offered convenience, quality personal service, and lifestyle compatibility?

A)corporate chain
B)administered system
C)contractual system
D)independent retailer
E)sole incorporation

Question 61

Organizations that decide to franchise (franchisors) have __________ expansion costs in opening new outlets accompanied by __________ control compared to owning their own retail outlets.

A)greater; greater
B)greater; reduced
C)reduced; greater
D)reduced; reduced
E)greater; about the same

Question 62

There are two general types of franchises:

A)product-format franchises and distribution franchise.
B)business-format franchise and manufacturing franchise.
C)business-format franchises and product-distribution franchises.
D)business-format franchises and general service franchise.
E)business-format franchises and venture franchise.

Question 63

The area of automotive franchises is a vast one - from glass repairs and painting to car rentals and auto maintenance franchises.Midas, Mister Transmission, Mr.Lube, RentAWreck, and Speedy Muffler are all examples of _________.

A)business-format franchises.
B)product-distribution franchises.
C)business franchise venture.
D)manufacturing franchises.
E)general service franchise.

Question 64

In this type of franchising, the company uses the agreement as a method for the distribution of its products.Chrysler, Ford, and Coca-Cola gives the franchisee the right to use the brand name of the franchisor to sells its products.

A)product-distribution franchise
B)business-format franchise
C)manufacturing franchise
D)general service franchise
E)business franchise venture

Question 65

Loehmann distinguishes themselves as preeminent, upscale, off-price specialty retailers for name band designer fashions.They offer in-season merchandise and frequent new arrivals at prices 30% to 65% less than department store prices.Loehamann retailers provide consumers with

A)full-service
B)limited service
C)self-serve
D)restricted serve
E)functional serve

Question 66

As a franchisor, Radio Shack would assist a franchisee in selecting the store location, setting up the store, advertising, and _________.

A)drawing in customers
B)training personnel
C)offering performance bonuses
D)ordering and restocking inventory
E)paying insurance and legal fees

Question 67

McDonald's, iHop, and Subway are all _________.

A)business-format franchises
B)product-distribution franchises
C)business franchise venture
D)manufacturing franchises
E)general service franchise

Question 68

FIGURE 14-1
Subway (see image in Figure 14.1 above) is a popular _________.

A)business-format franchises
B)product-distribution franchises
C)business franchise venture
D)manufacturing franchises
E)general service franchise

Question 69

General merchandise stores such as Walmart, Kmart, and Target are usually considered as _________ outlets.

A)exclusive service
B)minimal service
C)self-service
D)limited service
E)full-service

Question 70

Costco requires customers to perform many shopping functions themselves, and little is provided by the outlet.All nonessential customer services are eliminated.What level of service is being offered by Costco?

A)Limited service.
B)Full-service.
C)Customized service.
D)Self-serve.
E)Restricted.

Question 71

A franchise where the franchising company uses an agreement method for the distribution of its products is known as a

A)product-distribution franchise.
B)business-format franchise.
C)manufacturing franchise.
D)general service franchise.
E)business franchise venture.

Question 72

There are two general types of franchises: business-format franchises and __________ franchises.

A)product-format
B)general service
C)manufacturing
D)distribution
E)venture

Question 73

A franchise where the franchisor usually assists in selecting the location, setting up the store or facility, advertising, and training personnel is known as a

A)business-format franchises.
B)product-distribution franchises.
C)business franchise venture.
D)manufacturing franchises.
E)general service franchise.

Question 74

The three commonly used terms to describe levels of service are:

A)self-service, limited service, full service.
B)self-service, sales-service, customer service.
C)self-service, associate-directed, on-line service.
D)limited service, full service, computer directed service.
E)corporate service, retailer service, customer service.

Question 75

The level of service that requires that the customers perform many functions and little is provided by the outlet is _________.

A)full-service
B)self-serve
C)limited service
D)customized service
E)functional service

Question 76

Dominion is a Canadian supermarket.Recently, it began its Baby Club program, which mails members a $20 gift certificate when they purchase a certain dollar amount of infant products.By offering this and similar loyalty-type programs, Dominion is trying to

A)move from limited service to full-service.
B)move from self-service to full-service.
C)become more self-service.
D)move from self-service to limited service.
E)offer full-service at self-service prices.

Question 77

Off-price retailers, retail clubs, and grocery stores provide what level of retail service?

A)full-service
B)limited service
C)self-service
D)customized service
E)functional service

Question 78

The days of taking your groceries through the checkout yourself have arrived in the United States.A number of U.S.- based retail chains have begun using U-scan machines in their outlets.This is an example of what level of retail service?

A)full-service
B)limited service
C)self-service
D)customized service
E)functional service

Question 79

As a business-format franchisor, McDonald's provides step-by-step procedures for most aspects of the business and

A)provides an accounting system to pay the franchisee bills promptly.
B)shops for the best food values.
C)maintains the property.
D)guidelines for the most likely decisions a franchisee will face.
E)disciplines dishonest employees.

Question 80

When customers are responsible for most shopping activities at a retail outlet, these outlets would be classified as __________ outlets.

A)exclusive service
B)minimal service
C)self-service
D)limited service
E)full-service