85) Lezos, a chain of international restaurants, has operations in more than 50 countries around the
world. The company has a practice of investing in projects long enough for them to become
successful. Which of the following is most likely a reason for the success of Lezos in international
markets?
A) A global culture
B) Adaptability
C) Human resources
D) Financial resources
E) Rigidity
86) ________ occurs when a retail firm invests in and owns a retail operation in a foreign country.
A) Inventory investment
B) Portfolio investment
C) Direct investment
D) Philatelic investment
E) Alternative investment
87) Toss, a chain of sports equipment retailers, plans to invest in a retail operation in a foreign
country. Which of the following categories of investments does this belong to?
A) Philatelic investment
B) Alternative investment
C) Inventory investment
D) Portfolio investment
E) Direct investment
88) Which of the following statements is a key advantage of direct investments?
A) The retailer has complete control of the operations.
B) The retailer is exempted from trade taxes.
C) The retailer is at freedom to choose which nation’s law they adhere to.
D) The retailer is exempted from local trade laws.
E) A loss is borne equally by all involved parties.
89) A(n) ________ is formed when the entering retailer pools its resources with a local retailer to
form a new company in which ownership, control, and profits are shared.
A) merger
B) joint venture
C) acquisition
D) strategic alliance
E) takeover
90) Flee, a chain of electronic stores, plans to grow geographically. It has tied up with local
retailers in international markets to form a new company in which ownership, control, and profits
are shared between all involved parties. Which of the following entry strategies is being followed
by Flee?
A) Acquisition
B) Merger
C) Takeover
D) Joint venture
E) Strategic alliance
91) Which of the following statements is an advantage of a joint venture?
A) The entering retailer is exempted from trade taxes.
B) Trade laws favor the entering retailer.
C) The entering retailer takes all the profits.
D) The entering retailer has complete control of the operations.
E) The local partner provides an understanding of the market.
92) Which of the following statements is a disadvantage of a joint venture?
A) The entering retailer must bear all the loss.
B) Only the local retailer is exempted from trade laws.
C) Government places restrictions on the repatriation of profits.
D) Only the local retailer is exempted from trade tax.
E) The local retailer is at freedom to choose which laws they adhere to.
93) A(n) ________ is a collaborative relationship between independent firms.
A) strategic alliance
B) joint venture
C) acquisition
D) merger
E) takeover
94) MarMa, a retailer of auto accessories, plans to grow geographically. It has tied up with
independent international firms to facilitate its local logistical activities. Which of the following
entry strategies is being followed by MarMa?
A) Takeover
B) Joint venture
C) Acquisition
D) Merger
E) Strategic alliance
95) Which of the following statements is true of franchising?
A) It offers the highest risk and requires the least investment but also has the highest potential
return on investment.
B) It offers the lowest risk and requires the least investment but also has the lowest potential return
on investment.
C) It offers the lowest risk and requires the most investment but also has the highest potential
return on investment.
D) It offers the highest risk and requires the most investment but also has the highest potential
return on investment.
E) It offers the highest risk and requires the most investment but also has the lowest potential
return on investment.
96) Which of the following statements is a disadvantage of franchising?
A) The retailer bears all the loss.
B) Heavy taxes are levied on the retailer.
C) Local laws favor the franchise.
D) The potential profit is reduced.
E) This is the most expensive method of entering a new market.
97) Which of the following steps is typically the first step in the strategic retail planning process?
A) Develop a retail mix to implement strategy.
B) Evaluate performance and make adjustments.
C) Define the business mission.
D) Evaluate strategic alternatives.
E) Identify strategic opportunities.
98) Dave is a part of the strategic retail planning process in his organization. He has defined the
business mission. Which of the following steps is most likely Dave’s next stage in the strategic
planning process?
A) Conduct a SWOT analysis.
B) Evaluate performance and make adjustments.
C) Develop a retail mix to implement strategy.
D) Establish specific objectives and allocate resources.
E) Evaluate strategic alternatives.
99) Which of the following factors is classified as a market factor?
A) Economic conditions
B) New technology
C) Barriers to entry
D) Competitive rivalry
E) Seasonality
100) Which of the following factors is classified as a competitive factor?
A) Social changes
B) Bargaining power of vendors
C) New technology
D) Economic conditions
E) Market growth
101) Which of the following is true of scale economies?
A) Scale economies are volume advantages due to a retailer’s cost.
B) Scale economies are volume advantages due to a retailer’s size.
C) Scale economies are cost advantages due to a retailer’s size.
D) Scale economies are size advantages due to a retailer’s cost.
E) Scale economies are size advantages due to a retailer’s volume.
102) Which of the following factors is classified as environmental dynamics?
A) Market size
B) Seasonality
C) Barriers to entry
D) Social changes
E) Competitive rivalry
103) Which of the following is a condition that may lead to competitive rivalry?
A) Large number of competitors of the same size
B) Presence of perceived differences between competing retailers
C) Fast growth
D) Low fixed costs
E) Lack of competition
104) Josh is responsible for the strategic retail planning process in his organization. He has defined
the business mission and conducted a SWOT analysis. Which of the following steps is most likely
his next stage in the strategic retail planning process?
A) Evaluate strategic opportunities.
B) Establish specific objectives and allocate resources.
C) Identify strategic opportunities.
D) Develop a retail mix to implement strategy.
E) Evaluate performance and make adjustments.
105) Luke is responsible for the strategic retail planning process in his organization. He is
currently identifying the strategic opportunities. Which of the following steps is most likely to
have been Luke’s previous step before identifying the strategic opportunities?
A) Evaluating performance
B) Developing a retail mix
C) Establishing specific objectives
D) Evaluating strategic opportunities
E) Conducting a SWOT analysis
106) Zara is responsible for the strategic retail planning process in her organization. She has
identified the strategic opportunities. Which of the following steps is most likely Zara’s next stage
in the strategic retail planning process?
A) Define the business mission.
B) Evaluate strategic opportunities.
C) Evaluate performance.
D) Develop a retail mix.
E) Establish specific objectives.
107) Which of the following steps is typically the next step after evaluating strategic opportunities
in the strategic retail planning process?
A) Establishing specific objectives
B) Developing a retail mix
C) Evaluating performance
D) Defining the business mission
E) Conducting a SWOT analysis
108) Which of the following steps is typically the previous step before evaluating the strategic
opportunities in the strategic retail planning process?
A) Defining the business mission
B) Establishing specific objectives
C) Identifying strategic opportunities
D) Developing a retail mix
E) Evaluating performance
109) Which of the following steps is typically the next step after establishing specific objectives
and allocating resources in the strategic retail planning process?
A) Identifying strategic opportunities
B) Developing a retail mix to implement the strategy
C) Evaluating performance and making adjustments
D) Defining the business mission
E) Conducting a SWOT analysis
110) Which of the following steps is typically the previous step before establishing specific
objectives and allocating resources in the strategic retail planning process?
A) Identifying strategic opportunities
B) Developing a retail mix to implement strategy
C) Evaluating performance and making adjustments
D) Defining the business mission
E) Evaluating strategic opportunities
111) Which of the following steps is typically the next step after developing a retail mix to
implement the strategy in the strategic retail planning process?
A) Establishing specific objectives and allocating resources
B) Evaluating strategic opportunities
C) Identifying strategic opportunities
D) Evaluating performance and making adjustments
E) Defining the business mission
112) Which of the following steps is typically the previous step before developing a retail mix to
implement the strategy in the strategic retail planning process?
A) Establishing specific objectives and allocating resources
B) Evaluating strategic opportunities
C) Identifying strategic opportunities
D) Evaluating performance and making adjustments
E) Defining the business mission
113) Which of the following steps is typically the last step in the strategic retail planning process?
A) Develop a retail mix to implement strategy.
B) Establish specific objectives and allocate resources.
C) Evaluate performance and make adjustments.
D) Identify strategic opportunities.
E) Define the business mission.
114) Which of the following steps is most likely to be the previous step before evaluating
performance and making adjustments in the strategic retail planning process?
A) Define the business mission.
B) Develop a retail mix to implement strategy.
C) Identify strategic opportunities.
D) Conduct a SWOT analysis.
E) Evaluate strategic opportunities.
115) Name five approaches for retailers to develop a sustainable competitive advantage.
116) Describe customer loyalty and the ways in which retailers can build customer loyalty.
117) Define positioning.
118) Why would a retailer desire to have private-label or store brands?
119) What are customer relationship management programs?
120) How can a retailer use the market penetration opportunity to foster growth?
121) Differentiate between related and unrelated diversification.
122) List the key opportunities for success in global retailing.
123) Describe franchising.
124) List the steps in the strategic retail planning process.