38.
Producers emphasize selling products through intermediaries to ultimate consumers.
39.
Service companies, which provide a service for customers, have some characteristics of
both retailers and producers.
40.
A small service business cannot be started out of the owner’s home because it is not
economical.
41.
Convenience goods stores are interested in a high flow of customer traffic.
42.
Convenience goods are high-priced items, which are bought infrequently, and for which
customers compare prices.
43.
Specialty goods are usually low-priced items that are purchased often, are sold in many
stores, are bought by habit, and lend themselves to self-service.
44.
Specialty goods are bought infrequently, often at exclusive outlets, after special effort by
the customer to drive to the store.
45.
Seasonal stores may remain open year-round or may only open seasonally.
46.
A low crime rate is an advantage of a downtown location for a small business.
47.
Governments and financial businesses provide most of the business for retail stores in
shopping centers.
48.
A disadvantage of shopping centers is the presence of anchor stores.
49.
Kiosks are an inexpensive way of setting up a small business.
50.
A disadvantage of locating a small business in a shopping center is the possibility of policy
changes due to the change in the owners of the center.
51.
Important factors in choosing a manufacturing location are nearness to customers and
vendors and availability and cost of transportation.
52.
In the context of small businesses, moving manufacturing plants off shore usually results
in higher operating costs.
53.
In a small business, facilities must be designed or selected to produce the desired product
at the lowest practical cost.
54.
In the United States, telecommuting leads to reduced stress since the workplace and
home become one.
55.
Telecommuters in the United States may suffer from the disadvantage of a lack of DSL
service.
56.
For a small business, the advantage of a product layout includes efficient scheduling of
equipment and workers.
12–33
57.
A product layout tends to improve efficiency and maximize sales, especially in the
automobile and fast-food industries.
58.
A product layout can use the same general-purpose machines and equipment for several
steps in the operation.
59.
In a process layout, the facilities are laid out according to the sequence of operations to be
performed.
60.
In a small business, the process layout requires more movement of material or people, and
requires a larger inventory than a product layout.
Essay Questions
61.
What is an operating system? What are the productive elements of an operating system?
62.
What are the factors that influence the location decisions of retailers and producers?
63.
What is the difference between a convenience goods store and a shopping goods store?
64.
What are freestanding stores?
65.
Why are shopping centers so popular?
66.
What are the drawbacks of locating a small business in a shopping center?
67.
What is telecommuting and what are its disadvantages?
68.
In the context of small businesses, what is the difference between a product layout and a
process layout?
69.
In the context of small businesses, how can the products and methods of operation be
improved?
70.
How can performance standards be set in small business firms?
