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239) An approach to managing the assortment of merchandise in which a manager is assigned
the responsibility for selecting all products that consumers in a market segment might view as
substitutes for each other, with the objective of maximizing sales and profits in the category, is
referred to as
A) category capacity.
B) product management.
C) retail inventory category.
D) category management.
E) automated inventory control.
240) The marketing metrics related to a retailer's customers include all of the following except
which?
A) the number of customers per day or per hour
B) the average length of a store visit
C) the turnover of inventory
D) the average transaction size per customer
E) the number of transactions per customer
241) The marketing metrics related to a retailer's products or merchandise include all of the
following except which?
A) the cost of carrying inventory
B) the inventory turnover
C) the average number of items per transaction
D) the number of returns
E) the average length of a store visit
242) The marketing metrics related to a retailer's finances include all of the following except
which?
A) the markdown percentage
B) inventory carrying costs
C) the return on sales
D) the gross margin
E) the sales per employee
243) A common financial indicator of how effectively retail space is used to generate revenue
can be calculated by determining
A) net sales.
B) markdown percentage.
C) market share.
D) sales per square foot.
E) transactions per customer.
244) Sales per square foot is calculated by dividing
A) profit margin by selling area in square feet.
B) gross profit by selling area in square feet.
C) total sales by selling area in square feet.
D) return on investment by selling area in square feet.
E) net sales by selling area in square feet.
245) Boston Pizza wants to determine how effective its retail space is compared to other pizza
establishments in the local area. The calculation for this indicator is arrived at by determining the
________ for its store and comparing it against the same indicator for all of the other local pizza
outlets.
A) same-store gross margin
B) same-store sales growth
C) sales per square foot
D) net profit
E) same-store net present value
246) A financial indicator used to compare the change in sales of stores that have been open for
the same period of time is referred to as
A) return on investment.
B) percentage of markup.
C) gross profit.
D) sales per square foot.
E) same-store sales growth.
247) The calculation for same-store sales growth is
A) Total sales ÷ Selling area in square feet.
B) (Store sales in year 3 ÷ Store sales in year 1).
C) Store sales in year 1 ÷ (Store sales in year 2 - Store sales in year 1).
D) (Store sales in year 2 - Store sales in year 1) ÷ Store sales in year 1.
E) Store 1 square feet ÷ Store 2 square feet.
248) The description of how new forms of retail outlets enter the market is referred to as the
A) retail life cycle.
B) product life cycle.
C) wheel of retailing.
D) retail life matrix.
E) retail continuum.
249) The wheel of retailing refers to
A) the life cycle of most consumer products sold by retailers.
B) the diffusion of types of retailers for a new product.
C) the progression of retail locations an outlet goes through.
D) the description of how new forms of retail outlets enter the market.
E) the description of retail management philosophies.
250) Many fast-food retailers, including McDonald's and Burger King, have followed a
predictable pattern of how new forms of retail outlets enter the marketplace. McDonald's has
evolved from a relatively simple restaurant with low margins, low prices, limited product
offerings, and low institutional status to a worldwide chain with higher margins, high status, and
a diverse menu of products. This evolution of McDonald's restaurants is consistent with the
A) slow to fast-food restaurant evolutionary cycle.
B) revolution of retailing.
C) retail life cycle.
D) fast-food retail sequence.
E) wheel of retailing.
251) According to Figure 16-9 above, Box A represents the stage in the wheel of retailing when
a retail outlet starts with
A) low prices, high margins, and high status.
B) mixed prices, mixed margins, and mixed status.
C) low prices, low margins, and low status.
D) moderate prices, high margins, and high status.
E) high prices, low margins, and mixed status.
252) Figure 16-9 above shows the wheel of retailing, which indicates that retail outlets typically
go through changes with the passage of time, starting at Box A. What characteristics in the wheel
of retailing does B represent?
A) low breadth of product, high depth of product, and high status.
B) higher prices, higher margins, and higher status.
C) low breadth of product, low depth of product, and low status.
D) moderate prices, low margins, and high status.
E) high depth of product, low margins, and mixed status.
253) According to Figure 16-9 above, if D represents the entry of new forms of the outlet into
categories where older ones exist, where would you typically find the highest prices, margins,
and status?
A) A
B) B
C) C
D) D
E) A & D
254) In initially competing with established burger chains, outlets such as Checkers Drive-In
Restaurants typically enter the wheel of retailing with
A) limited menus and limited service.
B) extensive menus and expansive service.
C) extensive menus and self-service.
D) high prices and novel menu items.
E) high prices and expansive service.
255) Retail outlets, like products, experience the process of growth and decline, which is referred
to as the
A) retail life cycle.
B) wheel of retailing.
C) product life cycle.
D) retail continuum.
E) retail life matrix.
256) The retail life cycle refers to
A) the distinct stages a product goes through before it becomes obsolete.
B) the process of growth and decline that retail outlets, like products, experience.
C) the cycle of a customer's buying behavior from awareness of a product to its ultimate
purchase.
D) the relationship between the tangible aspects of a product and the types of services that need
to accompany it.
E) the traditional management changes that take place as a retail outlet grows.
257) The four stages of the retail life cycle are
A) introduction, growth, maturity, and decline.
B) awareness, inquiry, alternative evaluation, and purchase.
C) early growth, accelerated development, maturity, and decline.
D) innovation, standardization, adaptation, and obsolescence.
E) innovation, adaptation, imitation, and obsolescence.
258) In the retail life cycle, ________ is the stage of emergence of a retail outlet, with a sharp
departure from existing competition.
A) retail innovation
B) maturity
C) introduction
D) early growth
E) accelerated development
259) According to the retail life cycle, in which stage would market share rise gradually,
although profits may be low because of start-up costs?
A) decline
B) maturity
C) introduction
D) accelerated development
E) early growth
260) Which type of outlet is most likely in its early growth stage of the retail life cycle?
A) single-price stores
B) online retailers
C) supermarkets
D) general stores
261) Both market share and profit achieve their greatest growth rates during which stage of the
retail life cycle?
A) decline
B) maturity
C) introduction
D) early growth
E) accelerated development
262) During which stage of the retail life cycle do companies establish multiple outlets?
A) decline
B) maturity
C) accelerated development
D) introduction
E) early growth
263) The key goal for retailers in the accelerated development phase of the retail life cycle is to
A) recover start-up costs.
B) establish a dominant position in the fight for market share.
C) delay entering the decline stage of the retail life cycle.
D) find ways of discouraging customers from moving to low-margin, mass-volume outlets.
E) establish a retail concept that is a sharp departure from existing competition.
264) Accelerated development in the retail life cycle is similar to which stage in the product life
cycle?
A) introduction
B) maturity
C) decline
D) growth
E) harvest
265) Which type of outlet is most likely in its accelerated development stage of the retail life
cycle?
A) single-price stores
B) online retailers
C) supermarkets
D) business-district retailers
E) convenience stores
266) The battle for market share is usually fought directly before the ________ stage, and some
competitors drop out of the market.
A) decline
B) growth
C) maturity
D) harvest
E) introduction phase
267) Discounting generally takes place during which stage of the retail life cycle?
A) early growth
B) accelerated development
C) decline
D) maturity
E) early growth and maturity
268) Which type of outlet is most likely in its maturity stage of the retail life cycle?
A) single-price stores
B) value retail centers
C) online retailers
D) business-district retailers
E) convenience stores
269) Which type of outlet is most likely in its decline stage of the retail life cycle?
A) single-price stores
B) value retail centers
C) online retailers
D) business district retailers
E) convenience stores
270) According to Figure 16-10 above, market share reaches its highest level during which stage
of the retail life cycle?
A) early growth
B) accelerated development
C) decline
D) maturity
E) either early growth or maturity
271) According to Figure 16-10 above, Stage A represents which stage of the retail life cycle?
A) early growth
B) introduction
C) initiation
D) maturity
E) accelerated development
272) According to Figure 16-10 above, B represents which stage of the retail life cycle?
A) growth
B) introduction
C) expansion
D) maturity
E) accelerated development
273) According to Figure 16-10 above, C represents which stage of the retail life cycle?
A) decline
B) stabilization
C) expansion
D) maturity
E) accelerated development
274) According to Figure 16-10 above, D represents which stage of the retail life cycle?
A) decline
B) stabilization
C) obsolescence
D) maturity
E) accelerated development
275) ________ retailers utilize and integrate a combination of traditional store formats and
nonstore formats.
A) Progressive
B) Opportunistic
C) Multichannel
D) Cluster
E) Power
