Deck 16: Managing Retailing, wholesaling, and Logistics

Question 1

Intermediaries include retailers,________,and logistical organizations.

A)Internet companies
B)wholesalers
C)competitors
D)box stores
E)none of the above

Answer 1

B

Question 2

________ is the cornerstone of all discount operations.

A)Self-service
B)Self-selection
C)Limited service
D)Full service
E)Custom service

Answer 2

A

Question 3

One of the advantages of corporate retailing is that corporate retail organizations achieve economies of scale,greater purchasing power,and ________.

A)wider brand recognition
B)more locations
C)branded merchandise
D)"fresh" merchandise
E)more advertising

Answer 3

A

Question 4

Retailers must make marketing decisions in the areas of product assortment and procurement,services and store atmosphere,prices,communications,locations,and ________.

A)niche
B)style
C)shoppers
D)target market
E)procedures

Question 5

After deciding on the product-assortment strategy,the retailer must establish merchandise sources,________,and practices.

A)vendors
B)suppliers
C)lead times
D)policies
E)buyers

Question 6

High staffing costs,along with a higher proportion of specialty goods and slower-moving items and many services,result in the high cost structure of ________ retailing.

A)self-service
B)self-selection
C)limited service
D)full service
E)custom service

Question 7

Some intermediaries use strategic planning,advanced information systems,sophisticated marketing tools,measure performance on a return-on-investment basis,segment their markets,improve their target marketing and positioning,and ________.

A)contend with dwindling customer bases
B)aggressively "squeeze" manufacturer margins
C)aggressively pursue takeover strategies
D)dominant the manufacturers they do business with
E)aggressively pursue market expansion and diversification strategies

Question 8

Retailers are rapidly improving their skills in demand forecasting,merchandise selection,stock control,space allocation,and ________.

A)advertising
B)display
C)choosing the media mix
D)selecting the marketing channels
E)none of the above

Question 9

According to A.C.Nielsen Company,when considering whether to stock a new product,store mangers are most influenced by ________.

A)generous financial incentives to the trade
B)a well-designed advertising and sales promotion plan
C)attractive packaging that will catch consumers' attention
D)strong evidence of customer acceptance
E)none of the above

Question 10

Major retailer types include the following EXCEPT ________.

A)specialty store
B)discount store
C)catalog showroom
D)the Internet
E)superstore

Question 11

The first step to retail category management is to ________,which means deciding where to draw the line between product categories.

A)set goals
B)choose the audience
C)figure out tactics
D)define the category
E)figure out the category's role

Question 12

Retailers can position themselves as offering one of four service levels.Which of the following is NOT one of these levels?

A)Self-selection
B)Self-service
C)Limited service
D)Direct service
E)Full service

Question 13

Franchising accounts for more than $1 trillion of annual U.S.sales and nearly one-third of all retail transactions.Franchises are distinguished by three characteristics,which are: (1)The franchisee pays for the right to be part of the system: (2)the franchisor provides its franchisees with a system for doing business;and (3)________.

A)the franchisor controls all actions of the franchisee including hiring and marketing decisions
B)the franchisee has unlimited freedom to change the operation once he/she pays the upfront charges
C)the franchisor owns a trade or service mark and licenses it to franchisees in return for royalty payments
D)the franchisor receives a percentage of sales from the franchisee for the right to belong
E)none of the above

Question 14

The retailer must decide on product-assortment breadth and ________.

A)store location
B)layout
C)prices
D)selection
E)depth

Question 15

In a franchising system,individual franchisees are ________.

A)a tightly knit group of enterprises whose systematic operations are planned,directed,and controlled by the franchisor
B)regional managers of corporately owned facilities
C)employees working in front-line service roles for the entrepreneur
D)independent businesspeople who have the freedom to develop their own processes,brands,and images,facilitated by a retailing cooperative
E)none of the above

Question 16

A ________ is a storeless retailer serving a specific clientele-usually employees of large organizations-who are authorized to buy from a list of retailers that have agreed to give discounts in return for inclusion on the list.

A)direct-selling vendor
B)direct marketing vendor
C)buying service
D)automatic vendor
E)corporate retailer

Question 17

Nonstore retailing falls into four major categories.Which of the following is NOT one of the four nonstore retailing categories?

A)Buying service
B)Internet sales
C)Automatic vending
D)Direct marketing
E)Direct selling

Question 18

In the face of increased competition from discount houses and specialty stores,department stores are waging a comeback war.Two models for department stores' success seems to be emerging.The first is a store that has a strong retail brand approach,as demonstrated by Kohl's in the United States.The second model is the ________,typified by Galeries Lafayette in Paris.

A)tourist area store
B)single brand store
C)limited variety store
D)specialty store
E)showcase store

Question 19

An independent retailer using a central buying organization and joint promotion efforts is known as a ________.

A)corporate chain store
B)voluntary chain
C)retailer cooperative
D)merchandising conglomerate
E)franchise organization

Question 20

Recent trends in retailing includes which of the following?

A)Reduction in the level of global competition
B)Decline in the "shop at home" markets
C)Growth of the "smaller" boutique-type stores
D)Competition between Internet selling and store-based retailing
E)Competition between store-based and non-store-based retailing

Question 21

The functions that wholesalers perform include all of the following EXCEPT ________.

A)bulk breaking
B)buying and assortment building
C)financing
D)producing
E)market information

Question 22

Traditional brick-and-mortar retailers are responding to the growth of e-commerce by providing and emphasizing ________ as a strong differentiator.

A)celebrities on the premises
B)the shopping experience
C)expert advice in selecting merchandise
D)a wider selection of merchandise
E)the reputation of the retailer

Question 23

Besides the growing power of store brands,other factors weakening national brands include the fact that ________.

A)national brands' quality is superior to store brands
B)national manufacturers have increased advertising support for their brands
C)national brands have quality control problems not found in store brands
D)consumers are more price sensitive
E)consumers are more selective on purchases of national brands

Question 24

Distributors differ from retailers in a number of ways.One of these ways is that distributor transactions are usually ________ than retail transactions.

A)more concise
B)larger
C)more complicated
D)more involved
E)more limited

Question 25

A brand developed by a retailer and/or wholesaler that is available only in selected retail outlets is called a _________ brand.

A)national
B)household
C)premium
D)selective
E)private-label

Question 26

Every store has a "look" and a physical layout that makes it hard or easy to move around.These elements constitute a store's ________.

A)layout
B)transition zone
C)atmosphere
D)brands
E)none of the above

Question 27

Retailers can locate their stores in the central business district,a regional shopping center,________,a shopping strip,or within a larger store.

A)suburbia
B)town centers
C)strip malls
D)a freestanding location
E)a community shopping center

Question 28

________ refers to buying large carload lots and dividing them into smaller units before shipping them out to consumers.

A)Bulk breaking
B)Containerization
C)Wholesaling
D)Warehousing
E)Market logistics

Question 29

Retailers can assess a particular store's sales effectiveness by looking at (1)the number of people passing by on an average day; (2)the _________; (3)the percentage of those entering who buy;and (4)the average amount spent per sale.

A)percentage of customers who bought merchandise on "sale"
B)total units sold per day
C)total dollar sales per day
D)percentage of those who buy full-price merchandise
E)percentage who enter the store

Question 30

Most retailers will put low prices on some items to serve as traffic builders or _____________.

A)loss leaders
B)profit leaders
C)traffic leaders
D)ad items
E)none of the above

Question 31

________ measures a product's handling costs from the time the product reaches the warehouse until a customer buys it in the retail store.

A)Brand management
B)Shelf management
C)Profitability analysis
D)Direct product profitability analysis
E)Direct product performance analysis

Question 32

When retailers study the economics of buying and selling individual products,they typically find that ________ of their square footage is tied up in products that don't make an economic profit for them.

A)half
B)a quarter
C)almost all
D)none
E)a third

Question 33

Intermediaries sponsor their own brands because ________.

A)private-label brands sell at higher volumes
B)private-label brands are recognizable to the consumer as being widely available from many different retailers
C)private-label brands are always of better quality than national brands
D)private-label brands can be sold at lower prices yet generate a higher profit margin because of their lower cost structure
E)all of the above

Question 34

________ are unbranded,plainly packaged,less expensive versions of common products such as spaghetti,paper towels,and canned peaches.

A)Slotting fees
B)National products
C)Generics
D)Private labels
E)Shopping strips

Question 35

The three elements of the services mix for retailers includes ________.

A)target marketing
B)breath and depth
C)transition zone
D)direct product profitability
E)ancillary services

Question 36

________ is(are)a key positioning factor for retailers and must be decided in relation to the target market,the product-and-service assortment mix,and the competition.

A)Hours of operation
B)Advertisement
C)Locations
D)Prices
E)Assortment

Question 37

Fine specialty retailers most likely fall into the ________ group with respect to margins and volume.

A)mixed markup,high-volume
B)low-volume,mixed markup
C)low-volume,low-markup
D)high-volume,high-markup
E)high-markup,lower-volume

Question 38

In the pursuit of higher sales volume,retailers are studying their store environments for ways to improve the shopper's experience.According to Paco Underhill,one of his suggestions for fine-tuning retail space is to ________.

A)make the store "fun" and "interesting" but move the shoppers through it quickly
B)honor the "transition zone" and allow the shopper time to "sort out" the stimuli
C)place the checkouts in the rear of the store
D)make the store more receptive to "men" shoppers
E)make them "hunt" for it

Question 39

Major wholesaler types include all of the following EXCEPT ________.

A)full-service wholesalers
B)specialized wholesalers
C)cash and carry wholesalers
D)merchant wholesalers
E)direct-to-consumer wholesalers

Question 40

Because shelf space is scarce,many supermarkets now charge a ________ for accepting a new brand,to cover the cost of listing and stocking it.

A)generic
B)slotting fee
C)shopping strip
D)promotion allowance
E)none of the above

Question 41

The elapsed time between an order's receipt,delivery,and payment is called the ________.

A)variable-costs-to-payment cycle
B)product-to-payment cycle
C)inventory-to-sale cycle
D)order cycle
E)order-to-payment cycle

Question 42

________ are independently owned businesses that take title to the merchandise they handle.They are full-service and limited-service jobbers,distributors,and mill supply houses.

A)Brokers
B)Agents
C)Merchant wholesalers
D)Specialized wholesalers
E)Retailers' branches

Question 43

________ cost increases at an accelerating rate as the customer-service level approaches 100%.

A)Delivery
B)Promotion
C)Inventory
D)Merchandising
E)Storage

Question 44

Maximum customer service implies larger inventories,premium transportation,and multiple warehouses,all of which raise market-logistics costs.Market-logistics costs interact with marketing strategy and are often ________ related.

A)disproportionately
B)positively
C)negatively
D)complementarily
E)none of the above

Question 45

________ warehouses store goods for moderate to long periods of time.

A)Distribution
B)Automated
C)Storage
D)Company-owned
E)Local

Question 46

Inventory-carrying costs represent substantial dollars for manufacturers.These inventory-carrying costs include storage charges,cost of capital,taxes and insurance,and depreciation and obsolescence.Carrying costs might run as high as ________ of the value of the inventory.

A)70%
B)40%
C)25%
D)30%
E)50%

Question 47

Integrated logistics systems (ILS)involves materials management,________,and physical distribution,aided by information technology.

A)information flow systems
B)material flow systems
C)cash flow systems
D)product management systems
E)none of the above

Question 48

If the shipper owns its own truck or air fleet,it becomes a ________.

A)containerized carrier
B)private carrier
C)contract carrier
D)common carrier
E)diversified carrier

Question 49

Supply chain management (SCM)starts before physical distribution.It involves procuring the right inputs,_____ them efficiently into finished products,and then distributing them to the right customers.

A)using
B)converting
C)delivering
D)labeling
E)procuring

Question 50

Beyond the optimal order quantity,total cost per unit increases because ________.

A)inventory-carrying cost per unit increases
B)inventory-carrying cost per unit decreases
C)order-processing cost per unit rises
D)order-processing cost per unit falls more rapidly
E)order-processing cost per unit falls more slowly

Question 51

In deciding on the method or means of transportation,shippers consider such criteria as speed,frequency,________,capability,availability,traceability,and costs.

A)air versus ground
B)gypsy truckers
C)dependability
D)branded name truckers
E)costs per mile

Question 52

At some stock level point,management must reorder product to refill the inventory to an acceptable level.This point is called the ________.

A)order (reorder)point
B)inventory
C)minimum inventory level
D)inventory carrying costs
E)none of the above

Question 53

Wholesaler-distributors have faced mounting pressure in recent years.They have had to develop appropriate strategic responses.One major drive has been to increase ________ productivity by managing their inventories and receivables better.

A)product assortment
B)buying practices
C)personnel
D)asset
E)products

Question 54

________ consists of putting goods in boxes or trailers that are easy to transfer between two transportation modes.

A)Containerization
B)Private labeling
C)Inventory carrying
D)Order processing
E)Warehousing

Question 55

Today customers want more frequent deliveries,shorter order-cycle times,direct store deliveries,mixed pallets,tighter promised times,and ________ packaging,price tagging,and display building.

A)colorful
B)childproof
C)custom
D)easy opening
E)theftproof

Question 56

Companies are reducing their inventory costs by treating inventory items differently,positioning them according to risk and opportunity.High-risk,low-opportunity items are known as ________.

A)nuisance items
B)bottleneck items
C)commodities
D)critical items
E)containerized items

Question 57

Market-logistics strategies must be derived from ________,rather than solely from cost considerations.

A)competitive analysis
B)low-cost considerations
C)cost strategies
D)business strategies
E)marketing strategies

Question 58

Four major decisions must be made with regard to market logistics: order processing,warehousing,inventory,and ________.

A)transportation
B)purchases
C)pricing
D)information
E)none of the above

Question 59

________ involves planning the infrastructure to meet demand,then implementing and controlling the physical flows of materials and final goods from points of origin to points of use,to meet customer requirements at a profit.

A)Market logistics
B)Supply chain management
C)SCM
D)Integrated logistics systems
E)None of the above

Question 60

When considering competitors' service standards,companies normally want to match or exceed the competitors' service level while simultaneously maximizing ________.

A)profit
B)revenue
C)sales
D)costs
E)all of the above

Question 61

Prices are a key positioning factor to retailers and must be decided in relation to the target market.

Question 62

The retailer's product assortment does not need to match the target market's shopping expectations.

Question 63

A retailer's real challenge begins after defining the store's product assortment,and that is to develop a product-differentiation strategy.

Question 64

The amount of time shoppers spend in a store is perhaps the single most important factor in determining how much they will buy.

Question 65

Paco Underhill suggests that retailers,to increase sales volume,make their shoppers hunt for the merchandise.His logic is this: While "hunting," the shopper will be exposed to more and more products,thus the likelihood increases that the shopper will purchase "impulse" items,thus increasing their overall purchase total.

Question 66

An off-price retailer is one in which the retailer has a broad selection of high-markup,fast-moving,brand-name goods in stock.

Question 67

Today,growth in the retail market is centered firmly in the middle market,leaving luxury retailers and discounting specialists struggling.

Question 68

Retailers can position themselves as offering one of four levels of service.However,self-selection and self-service are the same in discount retailers.

Question 69

One of the up and coming trends in retailing is the growth of giant retailers,known as category killers and supercenters.

Question 70

The two models of the traditional department store's responses to competition is to develop a store with strong retail brand approaches and the "showcase" store.

Question 71

Corporate retail organizations achieve economies of scale,greater purchasing power,wider brand recognition,and better-trained employees.

Question 72

One of a retailer's most important decisions is "location,location,location."

Question 73

Retailing includes all the activities involved in selling goods or services directly to final consumers for personal,nonbusiness use.

Question 74

Nonstore retailing has not been growing as fast as traditional store retailing.

Question 75

Retailers are generally eager to stock new products,making it difficult for manufacturers to keep older,but proven brands on the shelves.

Question 76

Department stores today are exclusively worried about competition from other department stores.Other retailing forms are not a threat to department stores' sales and profitability.

Question 77

All of the benefits in a franchising system accrue to the franchisor because the franchisor is able to concentrate the risk and effort associated with running a store in the hands of the franchisee.

Question 78

Full service retailers have salespeople who are ready to assist the customers in every phase of their shopping trip.

Question 79

Because of the high cost of retail space,most retailers are highly attuned to which of the products they stock generate profit.

Question 80

Any organization selling to the final consumers is doing retailing.However,it matters how the goods or services are sold and where they are sold.