Deck 13: Retailers,wholesalers,and Their Strategy Planning

Question 1

Single-line stores that used to carry anything they could sell in reasonable volume were the main retailers in the United States.

Answer 1

False

Question 2

The mass-merchandising concept means that retailers can succeed by selling a large volume of merchandise to a target market at low prices.

Answer 2

True

Question 3

Department stores keep growing in numbers, sales, and market share.

Answer 3

False

Question 4

A consumer's choice of a retail store appears to be based almost entirely on emotional needs--economic needs have almost no influence.

Question 5

Department stores are larger stores that are organized into many separate departments and offer many product lines.

Question 6

Department stores are stores which usually try to serve customers seeking a variety of convenience products.

Question 7

A consumer's choice of a retail store appears to be based almost entirely on economic needs.

Question 8

Retailing includes all of the activities involved in reselling goods to final consumers, but it does not include the sale of services to final consumers since services must be produced in the presence of the consumer.

Question 9

Retailers who follow a policy of "buy low and sell high" are practicing the "mass-merchandising concept."

Question 10

Most "conventional" retailers are single-line or limited-line stores that have very low expenses relative to sales.

Question 11

The marketing strategies for the two shoe retailers Payless and Zappos are very different but both are successful.

Question 12

Retailers and their strategies can easily be classified based on the type of merchandise they sell.

Question 13

The marketing strategies for the two shoe retailers Payless and Zappos are very different, and Zappos' strategy is successful while Payless' strategy is not.

Question 14

Most single-line and limited-line stores apply the retailing philosophy of buying low and selling high.

Question 15

In most countries, small limited-line retailers still account for the majority of all retailers.

Question 16

It's oversimplified to classify retailers and their strategies on the basis of a single characteristic--such as sales volume, services, product assortment, etc.

Question 17

Mass-merchandisers have proved to be effective competitors in taking away department store customers.

Question 18

Specialty shops will continue to be a part of the retailing scene as long as customers have varied tastes and the money to satisfy them.

Question 19

In the U.S. about three-fourths of new retailing ventures fail during the first year.

Question 20

Specialty shops are limited-line stores which aim at a carefully defined target market with a unique product assortment, good service, and knowledgeable salespeople.

Question 21

In addition to food, warehouse clubs emphasize heterogeneous shopping goods.

Question 22

Super warehouse stores charge higher prices than supermarkets and focus on attracting customers who want better selections of perishables like meat and produce.

Question 23

"Supercenters" are very large stores that specialize in selling a big variety of infrequently purchased products that would otherwise be hard for consumers to find.

Question 24

Category killers is another name for single-line mass-merchandisers.

Question 25

A "supercenter" carries all the goods and services that a consumer might routinely purchase.

Question 26

Mass-merchandisers have become the primary place to shop for many frequently purchased consumer products.

Question 27

Today, discount houses are found in low-rent facilities, have poor images with customers, and offer few services and no guarantees.

Question 28

Mass-merchandisers emphasize "hard goods" while discount houses emphasize "soft goods."

Question 29

A discount house is trying to meet all the customer's routine needs at a low price.

Question 30

Warehouse clubs started the move to mass-merchandising.

Question 31

Convenience food stores now compete with supermarkets, gas stations, and fast-food outlets.

Question 32

In addition to food, warehouse clubs carry homogeneous shopping goods.

Question 33

The basic idea for supermarkets developed in the U.S. in the 1960s when consumers started to move from the cities to the suburbs.

Question 34

The major advantage of vending machine retailing is that the costs are low relative to the volume they sell.

Question 35

Discount stores offer "soft goods" at substantial price cuts to customers.

Question 36

The sale of candy from a vending machine at a bus station is not considered retailing since no store is involved.

Question 37

A consumer who went to shop at a "supercenter" would probably expect not only to be able to buy food and health care products, but also to leave dry-cleaning or have shoes repaired.

Question 38

Because of their higher margins, faster turnover, and narrower assortments, convenience food stores have the potential to be more profitable than supermarkets.

Question 39

Walmart, one of the largest mass-merchandisers in the U.S., handles 30 percent or more of the total national sales for whole categories of products.

Question 40

Large sales volume and efficient operation are usually very important for supermarkets, since net profits usually run 1 percent of sales or less.

Question 41

Many types of retailers are now establishing a presence on the Internet.

Question 42

It's usually possible for a consumer to get much more information about a product in a retail store than on the Web.

Question 43

Door-to-door selling now accounts for less than 1 percent of retail sales.

Question 44

Large chains like Target use their Web sites to supplement their stores (because their Web sites offer a much broader product assortment than their stores).

Question 45

More than 45 percent of all retail sales are in some way influenced by the Internet.

Question 46

Automatic vending accounts for 15 percent of total U.S. retail sales.

Question 47

Most catalog retailers now use a multichannel approach--with a catalog and sometimes physical stores, along with a Web site.

Question 48

Shoplifting is a big problem for direct-mail retailers.

Question 49

Electronic shopping, which puts catalogs on cable TV or Internet Web sites, has not yet succeeded.

Question 50

Internationally, door-to-door selling is growing in popularity and, in the U.S., it accounts for more than 15 percent of all retail sales.

Question 51

It is usually easier for a consumer to inspect a product in a retail store than on the Web.

Question 52

Retailing on the Internet already accounts for about 25 percent of all retail sales.

Question 53

The Internet makes it easy to do comparison shopping of products and prices.

Question 54

Retail sales on the Internet grew very rapidly at first, but now are expected to grow slowly.

Question 55

A prime target of home-shopping cable TV channels and direct-mail retailers is time-pressured, dual-career families.

Question 56

When RedBox rents DVD movies from vending machines at McDonald's, it is acting as a channel captain, not a retailer.

Question 57

Telephone selling (telemarketing) is still extremely popular despite the National Do Not Call Registry.

Question 58

It's best to think of retailing on the Internet as just another example of how low-margin mass-merchandisers appeal to large target markets with discount prices.

Question 59

Today, about half of all computer hardware and software and a quarter of all books are sold online.

Question 60

A consumer's total cost of shopping on the Internet includes delivery costs in addition to purchase price.

Question 61

Online retailers like Zappos or Amazon try to differentiate their offering primarily by being more efficient than competitors.

Question 62

The development of department stores and supermarkets is explained by the "Wheel of Retailing" theory.

Question 63

"Scrambled merchandising" refers to the practice of conventional retailers handling many products within a limited-line, even though many of these products have to be sold at a low profit.

Question 64

Application of the product life cycle concept to retailing suggests that all types of retailers are in early market growth due to continually increasing family income.

Question 65

Less than 8 percent of all retail sales are made by smaller stores--those with sales of less than $1 million a year.

Question 66

The majority of all retailers in the U.S. have annual average sales of less than $1 million.

Question 67

Only about 11 percent of retail stores in the U.S. have annual average sales of $5 million or more.

Question 68

Outdoor-gear seller L.L. Bean differentiates its offering by being very focused on the specific needs of its target customers.

Question 69

The average retail store is too small to gain economies of scale.

Question 70

Scrambled merchandising is carrying any product lines a store thinks it can sell profitably.

Question 71

Upscale multichannel retailers like Williams-Sonoma use their Web sites to complement their stores (by having the different channels focus on different benefits).

Question 72

Almost 70 percent of all retail sales are made by the largest stores--those with sales of over $5 million a year.

Question 73

Retailers who carry any product line that will sell profitably are practicing "scrambled merchandising."

Question 74

The "wheel of retailing" theory says that new retailers enter the market as high-status, high-margin, high-price operators and then evolve into discount stores as competition becomes more intense.

Question 75

The "wheel of retailing" theory fails to explain some major retailing developments, such as vending machines and convenience food stores, which did not enter the market with a low-price emphasis.

Question 76

Corporate chains are taking a smaller percentage of retail sales now that consumers are demanding lower prices.

Question 77

Ace Hardware is a multichannel retailer that integrates online and brick-and-mortar stores (because its customers gather information online and then buy in a store or vice versa).

Question 78

The product life cycle concept applies to retailers as well as products.

Question 79

Scrambled merchandising means mixing product lines for higher profits.

Question 80

The development of vending machines and convenience food stores is not explained by the "Wheel of Retailing" theory.