Deck 14: Developing Merchandise Plans

Question 1

Assortment planning for staple merchandise is accomplished by a _____.

A)want book
B)want slip
C)basic stock list
D)model stock plan

Answer 1

C

Question 2

A major disadvantage of a merchandising philosophy is that _____.

A)coordination of buying and selling may be impaired
B)responsibility for success or failure may be unclear
C)buying and selling functions require different skills
D)communication between selling and buying staff may be unclear

Answer 2

C

Question 3

A major disadvantage of centralized buying is _____.

A)disjointed planning
B)excessive uniformity
C)a quick order process
D)an inconsistent image

Answer 3

B

Question 4

Informal buying organizations are generally found in _____.

A)chains
B)department stores
C)independents
D)variety stores

Question 5

In a formal buying organization,_____.

A)existing personnel handle other functions
B)organization costs are low
C)the merchandising function is viewed as a distinct retail task
D)responsibility and authority are generally not clearly defined

Question 6

Cooperative buying is generally used by _____.

A)inside buying organizations
B)outside buying organizations
C)small,independent retailers
D)formal buying organizations

Question 7

Which type of buying organization generally serves noncompeting retailers,offers marketing research expertise,and sometimes sponsors private-label goods?

A)inside buying organization
B)outside buying organization
C)general buying organization
D)specialized buying organization

Question 8

The regular products carried by a retailer constitute _____ merchandise.

A)fashion
B)staple
C)assortment
D)fad

Question 9

Assortment planning for fashion merchandise is accomplished by a _____.

A)want book
B)basic stock list
C)want slip
D)model stock plan

Question 10

Which buying organization often operates in important merchandise centers?

A)general buying office
B)resident buying office
C)inside buying office
D)outside buying office

Question 11

What type of products generate high sales levels for a short time period?

A)fashion merchandise
B)assortment merchandise
C)seasonal merchandise
D)fad merchandise

Question 12

A major advantage of a merchandising philosophy is the _____.

A)specialization of functions
B)superior management of selling staff
C)higher morale for in-store personnel
D)integrated buying and selling effort

Question 13

In which strategy does a retailer adjust its self-space allocations to respond to customer and other differences among local markets?

A)micromerchandising
B)concentrated marketing
C)cross-merchandising
D)niche marketing

Question 14

The expected retail sales of a product or product category for given time periods is a _____.

A)sales expectation
B)sales perception
C)sales analysis
D)forecast

Question 15

What type of products may have cyclical sales due to changing tastes and lifestyles?

A)assortment merchandise
B)fashion merchandise
C)staple merchandise
D)fad merchandise

Question 16

Merchandising includes _____.

A)all the steps in the buying and selling of products
B)the purchasing of products but not the sale of them
C)pricing and product assortment decisions only
D)cooperative buying arrangements only

Question 17

A retailer specifically attempts to increase its average sale through carrying complementary goods and services in _____.

A)cross-merchandising
B)impulse sales
C)scrambled merchandising
D)merchandising

Question 18

All purchases originate from one office in a(n)_____ buying organization.

A)centralized
B)decentralized
C)informal
D)inside

Question 19

What type of products sell well over nonconsecutive time periods?

A)fashion merchandise
B)seasonal merchandise
C)assortment merchandise
D)fad merchandise

Question 20

Which merchandising position is responsible for selecting merchandise to ensure a focused continuity for a particular segment of business?

A)buyer
B)associate buyer
C)store manager
D)divisional merchandise manager

Question 21

Unbranded,no-frills goods are classified as _____.

A)generics
B)private brands
C)manufacturer brands
D)scrambled merchandising

Question 22

A major advantage to a retailer's use of private (dealer)brands is _____.

A)the generation of store loyalty
B)support by manufacturer advertising
C)less retailer investment
D)the extent to which they are pre-sold to customers

Question 23

Regional buying preferences are best served through which buying organization?

A)informal buying organization
B)formal buying organization
C)decentralized buying organization
D)centralized buying organization

Question 24

In the growth stage of the product life cycle,_____.

A)a wide variety of retailers offer a large range of prices,services,and quality
B)promotion must be explanatory in nature
C)a skimming price strategy is used
D)product sales reach their maximum

Question 25

The battle of the brands refers to the _____.

A)competition that occurs among manufacturer,private,and generic brands
B)price competition between domestic and foreign goods
C)increased competition for shelf space between private and generic brands
D)increased competition within a brand due to product line extensions

Question 26

Which productivity enhancement technique focuses on strategic business units?

A)category management
B)electronic data interchange
C)just-in-time inventory management
D)management by objectives

Question 27

A major retailer desires to use full-time specialized merchandisers.The most appropriate buying organization is a(n)_____ buying organization.

A)formal
B)informal
C)decentralized
D)inside

Question 28

A vertical fashion trend occurs when a fashion is _____

A)passed from the lower to the upper social classes
B)accepted by the general public while retaining its basic form
C)accepted by one market segment only
D)accepted by an upscale market segment,but undergoes basic changes before it is sold to the general public

Question 29

Which retail assortment strategy is characterized by one-stop shopping appeals,a broad market appeal,and a high inventory investment?

A)narrow and shallow
B)narrow and deep
C)wide and shallow
D)wide and deep

Question 30

A common difficulty in the handling of many substitute goods or services is that _____.

A)inventory turnover may increase
B)one-stop shopping may not be promoted
C)scrambled merchandising is achieved
D)overall sales may not increase

Question 31

In which product life-cycle stage do product sales reach their maximum?

A)growth
B)introduction
C)maturity
D)decline

Question 32

Centralized buying organizations,outside buying organizations,and cooperative buying are examples of _____.

A)merchandising organizations
B)formal buying organizations
C)diversified retailer-based buying organizations
D)retail chain-based buying organizations

Question 33

Variations of a basic product first appear and width and depth of assortment expand in which product life-cycle stage?

A)introduction
B)growth
C)maturity
D)decline

Question 34

A vertical fashion trend assumes that _____.

A)a fashion is passed from the upscale customers to the mass market
B)New York is the fashion capital of the world
C)innovative customers may come from any social class
D)merchandise must be sold across the social class spectrum

Question 35

Micromerchandising is most likely to be implemented through a(n)_____ buying organization.

A)formal
B)informal
C)decentralized
D)inside

Question 36

A retailer requires a merchandise management organization in which sales personnel are closely supervised.An appropriate organization focuses on _____.

A)merchandising
B)separate buying and selling functions and staff
C)a centralized buying organization
D)a decentralized buying organization

Question 37

Which of the following productivity measures would not be part of category management?

A)sales per capita
B)sales per linear foot of shelf space
C)direct product profitability
D)return on inventory investment

Question 38

Which retail assortment strategy is characterized by one-stop shopping appeals,an emphasis on convenience customers,and a limited variety?

A)wide and deep
B)wide and shallow
C)narrow and deep
D)narrow and shallow

Question 39

In general,as a retailer moves toward a wide and deep strategy,_____.

A)customer disappointment with selection increases
B)one-stop shopping appeals are lost
C)merchandise turnover decreases
D)a specialist image is received

Question 40

A limited target market consisting of high-income and innovative consumers exists in which stage of the product life cycle?

A)decline
B)growth
C)maturity
D)introduction

Question 41

Which retail assortment strategy is utilized by a convenience store?

A)wide and deep
B)deep and shallow
C)narrow and shallow
D)narrow and deep

Question 42

A U.S.-based apparel retailer can best keep in touch with developments in the leather accessories market based in Florence,Italy,through a(n)_____.

A)inside buying organization
B)resident buying office
C)informal buying organization
D)centralized buying organization

Question 43

Small retailers can obtain volume discounts and buying power similar to chain organizations through _____.

A)cooperative buying
B)resident buying offices
C)an inside buying organization
D)a centralized buying organization

Question 44

Generally,most products are in which traditional product life-cycle stage?

A)introduction
B)maturity
C)growth
D)competition

Question 45

Sheets,towels,and bedding for a department store are most accurately characterized as _____ merchandise.

A)seasonal
B)fashion
C)staple
D)fad

Question 46

One-stop shopping,no disappointment of customers,and appeal to a broad market are the advantages to which retail assortment strategy?

A)narrow and shallow
B)narrow and deep
C)wide and deep
D)wide and shallow

Question 47

A traditional pharmacy that adds a line of school supplies during August and September illustrates which merchandising strategy?

A)scrambled merchandising
B)trading up
C)selling complementary goods
D)handling substitute products

Question 48

An example of a modified centralized/decentralized buying organization is when _____.

A)local store managers can vary some of their orders
B)buying and selling have separate organizations
C)some orders are store-originated while others are conducted by external personnel
D)some orders are placed by retailers while others are placed by a retailer-based association

Question 49

The selling of both major appliances and extended warranties for them by an appliance dealer illustrates _____.

A)trading up
B)selling complementary goods
C)scrambled merchandising
D)selling substitute goods

Question 50

The major difference between the descriptions of goods in a basic stock list and in a model stock plan is the _____.

A)size distribution
B)amount of goods purchased
C)extent to which descriptions change period to period
D)seasonality inherent in a basic stock list

Question 51

A chain retailer can maximize its buying power advantages through use of a(n)_____.

A)informal buying organization
B)resident buying office
C)decentralized buying organization
D)centralized buying organization

Question 52

Which merchandising personnel position in a retail chain oversees the execution of merchandise selection and procurement for a particular segment of business?

A)buyer
B)associate buyer
C)store manager
D)divisional merchandise manager

Question 53

Retail price competition is generally greatest in which stage of the traditional product life cycle?

A)introduction
B)competition
C)growth
D)maturity

Question 54

The basic difference between a vertical and horizontal fashion trend is based on fashion acceptance _____.

A)for fads versus fashion items
B)versus product deletion
C)of staple versus innovative merchandise
D)between social classes versus within a social class

Question 55

Personnel in a retail chain are specialists overseeing either buying or selling.This firm has a _____ philosophy.

A)decentralized
B)centralized
C)merchandising
D)buying

Question 56

Which retail assortment strategy is used by a specialty store?

A)narrow and shallow
B)narrow and deep
C)wide and shallow
D)wide and deep

Question 57

Which retail assortment strategy is used by a traditional department store?

A)wide and deep
B)narrow and shallow
C)wide and shallow
D)narrow and deep

Question 58

Key-item merchandising is budgeted using a _____.

A)never-out list
B)basic stock list
C)model stock plan
D)merchandise assortment plan

Question 59

The major difference between vertical and horizontal fashion trends is based on _____.

A)the initial group which accepts the trend
B)whether the product changes form
C)the initial group which accepts the trend and whether the product changes form
D)the degree of fashion innovativeness

Question 60

Which inventory planning tool can be used for staple,fashion,or fad merchandise?

A)want slip
B)never-out list
C)model stock plan
D)basic stock list

Question 61

A major difference between the sale of complementary goods/services versus the sale of substitute goods is that the sale of substitute goods may _____.

A)have little impact on total retail sales
B)increase inventory turnover
C)give a retailer a one-stop shopping environment
D)provide a weak retail image

Question 62

In a horizontal fashion trend,a fashion is passed from the upper through lower classes through distinctive,emulation,and economic emulation stages.

Question 63

For staple merchandise,assortment planning is conducted with the use of a basic stock list.

Question 64

Which of these category management measures is most similar to inventory turnover?

A)return on inventory investment
B)gross profit per linear foot of shelf space
C)days supply
D)direct product profitability

Question 65

A retailer can purchase a private-label bread for 59ȼ a loaf.The bread sells for 89ȼ.Total direct retailing costs for the bread (warehouse costs,direct labor,and spoilage)equal 10ȼ per loaf.In addition,5ȼ per loaf is charged for administrative overhead.What is the direct product profitability per loaf?

A)20ȼ
B)30ȼ
C)45ȼ
D)The answer cannot be determined from the information provided.

Question 66

Market saturation and product obsolescence characterize the maturity stage of the product life cycle.

Question 67

A retailer seeks store loyalty,as well as greater channel control.Which branding philosophy should the retailer use?

A)manufacturer branding
B)generic branding
C)private branding
D)mixed branding

Question 68

A retailer takes 4 days to process an order and the supplier takes 12 days to deliver merchandise.The retailer should begin to order merchandise how many days before the old inventory runs out?

A)3 days
B)4 days
C)16 days
D)48 days

Question 69

In the emulation stage of a vertical trend,an original design is modified and then sold by fine department stores.

Question 70

Scrambled merchandising is an extension of cross-merchandising.

Question 71

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

A)direct product profitability
B)inventory turnover
C)return of inventory investment
D)gross profit per linear foot of shelf space

Question 72

Retail promotion in the growth stage of the product life cycle is geared to informing customers about product attributes.

Question 73

According to a category management classification,a product with high profitability but low unit sales would be classified as a _____.

A)traffic builder
B)problem child
C)sleeper
D)dog

Question 74

Category management is a strategy that is used to improve a retailer's _____.

A)shelf-space productivity
B)point-of-sale displays
C)capital costs
D)overall productivity through the use of computerization

Question 75

The goal in a never-out list is to maximize inventory turnover.

Question 76

Cross-merchandising is most effectively used in the sale of _____.

A)private brands
B)substitute goods
C)generic brands
D)complementary goods

Question 77

A major advantage of a centralized buying organization is low prices due to high bargaining power and quantity discounts.

Question 78

Direct product profitability equals an item's _____.

A)annual sales divided by the total linear footage devoted to a product category
B)gross profit less its direct retailing costs
C)annual gross profit divided by the total linear footage devoted to the item
D)number of days' supply that is on the shelf

Question 79

A merchandising philosophy is appropriate to a retailer that feels that buying and selling functions each require different skills.

Question 80

Formal buying organizations are most likely to be found in small independent retailers.