Chapter 12: International Retailing
TRUE/FALSE
1. Wal-Mart’s primary focus is on Latin American expansion.
2. Although some of this growth can be attributed to its Latin American operations, Wal-Mart’s primary
expansion focus remains on Europe.
3. Carrefour is the largest retailer in the world.
4. Carrefour has bought out the Asda Group in the United Kingdom.
5. The top European grocery retailers command a forty percent market share in Europe.
6. In the process of internationalization, many retailers are subscribing to the current trend of
consolidation in the food and general merchandise sectors.
7. Specialty stores offer a narrow product line and limited assortment.
8. In most low-income countries, general merchandise stores represent the main retail format.
9. Outside the United States, department stores typically also have a large supermarket section.
10. In Canada, department stores have enjoyed substantial gains in the past decade.
11. Department stores are numerous in Central and Eastern Europe.
12. Central European department stores have a substantial presence of leased departments that offer
noncompeting products.
13. Japanese department stores started out as electronics shops.
14. American department stores have expanded in China and Hong Kong where they control 50% of the
market.
15. While department stores remain a dominant retail outlet in Asia, they are currently displaying
symptoms of decline.
16. “Category killers” carry a wide variety of merchandise and offer a deep assortment.
17. The “all-purpose” general merchandise discount store tends to draw a substantial portion of profits
from its supermarket section.
18. Category specialists are large department stores that carry a narrow variety of merchandise and a deep
assortment.
19. While off-price retailers are popular in the United States and Canada, there are limited opportunities in
the rest of the world for purchasing brand names at a discount.
20. Factory outlet stores are examples of general discount retailers.
21. A typical format for a catalog showroom would be one where customers order from a catalog in the
showroom where the product is only displayed, and then picks up the merchandise at a designated
location.
22. Regarding superstores, hypermarkets have been more successful than combination stores in the United
States.
23. Hypermarkets combine supermarket and specialty store principles.
24. K-Mart is expanding internationally using mainly a combination store format.
25. Sam’s Club’s most important operations are in Germany.
26. Convenience stores abound in both low- and high-income countries.
27. With the advent of the Smart Card, convenience stores have become more popular than ever.
28. Vending machines in Japan sell eggs, cameras, and even life insurance.
29. Direct selling is in the mature stage in most of the developing world.
30. In South Africa, the poor transportation infrastructure presents a challenge to network marketing.
31. In Japan and Korea, Saturday is a major shopping day.
32. In Argentina and Saudi Arabia ,consumers prefer to purchase food products at supermarkets, while in
Mexico, consumers prefer to go to farmer’s markets for fresh produce.
33. Consumers in the Philippines prefer to purchase fruit with bugs on it.
34. In China, the sales staff tend to be overly conscientious: If a customer forgets to pick up the change
after a sale is complete, the salesperson will most likely follow him or her into the street to return the
change.
35. In some countries, salespeople keep the change and sell only those products that are priced under an
even amount so that they can claim they do not have the change if a customer dares challenge them.
36. In countries where there may be shortages of certain products, salespeople are bribed with money and
other goods such as coffee, cigarettes, and perfume.
37. In many low-income countries, not dressing well in upscale stores could easily result in denial of
service.
MULTIPLE CHOICE
1. Which of the following is the largest retailer worldwide?
a.
Bon Marché
c.
Carrefour
b.
Intermarché
d.
Wal-Mart
2. Which country dominates in terms of the retail sales market share?
a.
France
c.
Japan
b.
United Kingdom
d.
United States
3. Wal-Mart’s primary focus of international expansion is on which region?
a.
Latin America
c.
Asia
b.
Europe
d.
Africa
4. Which company is not in the list of the five leading European retailers?
a.
Carrefour
c.
Intermarché
b.
Metro
d.
Edeka
5. In the process of internationalization, many retailers are subscribing to the current trend of:
a.
category specialization.
b.
consolidation in the food and general merchandise sectors.
c.
distribution center development.
d.
diversification.
6. Which type of offering is common for specialty stores?
a.
Narrow product line and limited assortment
b.
Broad product line and deep assortment
c.
Narrow product line and deep assortment
d.
Broad product line and limited assortment
7. In low-income countries, which type of store represents the main retail format?
a.
Specialty stores
c.
General merchandise discount stores
b.
Department stores
d.
Off-price retailers
8. Which of the following is not an example of a specialized market?
a.
The Cairo Gold Market
b.
The Jade Market in Hong Kong
c.
The Spice Market in Turkey
d.
All of the above are examples of specialized markets.
9. Which type of offering is characteristic of department stores?
a.
Broad variety of goods and limited assortment
b.
Broad variety of goods and deep assortments
c.
Limited variety of goods and limited assortment
d.
Limited variety of goods and deep assortments
10. Japanese department stores started out as which type of specialty store?
a.
Kimono shops
c.
Cosmetics kiosks
b.
Electronic shops
d.
Grocery stores
11. Which of the following is not characteristic of general merchandise discount stores?
a.
High volumes of merchandise
b.
Full service
c.
Lower prices
d.
All of the above are characteristic of general merchandise discount stores.
12. Which type of offering is characteristic of category killers?
a.
High variety of merchandise and limited assortment
b.
High variety of merchandise and deep assortment
c.
Narrow variety of merchandise and deep assortment
d.
Narrow variety of merchandise and limited assortment
13. Which of the following is not an example of a category specialist?
a.
Ikea
c.
Toys ‘R’ Us
b.
Office Max
d.
Wal-Mart
14. ____ sell brand name and designer merchandise below regular retail.
a.
Hypermarkets
c.
Specialty stores
b.
Off-price retailers
d.
All of the above
15. Factory outlet stores and close-out retailers are examples of
a.
Hypermarkets
c.
Specialty stores
b.
Off-price retailers
d.
All of the above
16. This type of retailing is popular in the United States and Canada, but not in the rest of the world.
a.
Hypermarkets
c.
Specialty stores
b.
Off-price retailers
d.
Discount stores
17. Single-price retailers, such as the dollar store, are examples of
a.
Discount stores
c.
Specialty stores
b.
Off-price retailers
d.
All of the above
18. IKEA is an example of what kind of store?
a.
Off-Price retailer
c.
Category specialist
b.
Catalog showroom
d.
Wholesale club
19. Which retail category is not included in the “superstore” classification?
a.
Combination stores
b.
Hypermarkets
c.
Catalog showrooms
d.
Each of the above is included in the “superstore” classification.
20. Which of the following are examples of superstores?
a.
Specialty stores
c.
Hypermarkets
b.
Off-price retailers
d.
All of the above
21. ____ combine supermarket, discount and warehouse retailing principles.
a.
Specialty stores
c.
Hypermarkets
b.
Off-price retailers
d.
All of the above
22. Hypermarkets use which of the following retailing principles?
a.
Supermarket retailing principles
c.
Warehouse retailing principles
b.
Discount store retailing principles
d.
All of the above
23. Which company is the largest retailer in France?
a.
Bon Marché
c.
Carrefour
b.
Intermarché
d.
Wal-Mart
24. Which of the following statements is not true regarding Internet retailing?
a.
In developed, high-income countries, Internet purchasing is experience-driven.
b.
Shopping via the Internet is quite different for consumers in developed countries
compared to consumers in developing countries.
c.
The Internet presents dilemmas with regard to customer service.
d.
Each of the above statements is true.
25. According to the text, which innovation has caused vending machine retailing to become more popular
than ever?
a.
Refrigeration
c.
Smart cards
b.
Interactive videos
d.
The Internet
26. Which of the following is not likely to be sold in a Japanese vending machine?
a.
Insurance
b.
Cola
c.
Cameras
d.
All of the above are likely to be sold in a Japanese vending machine.
27. Neckermann and Quelle are examples of
a.
Specialty stores
c.
catalog showrooms
b.
Catalog retailers
d.
b and c only
28. Catalog and Internet retailers found that consumers in Japan expect:
a.
to pay after receiving the product.
b.
a lifetime warranty.
c.
products to be delivered within two days.
d.
free shipping and handling.
29. In most of the developing world, direct selling is in which stage?
a.
Introduction
c.
Maturity
b.
Growth
d.
Decline
30. According to the text, which country has serious restrictions on direct selling?
a.
Saudi Arabia
c.
Vietnam
b.
China
d.
Egypt
31. Which form of retailing is currently experiencing rapid growth in South Africa despite infrastructure
problems?
a.
Specialty stores
c.
General merchandise discount stores
b.
Vending machines
d.
Network marketing
32. Which company is not an example of a network marketing firm that has gone international?
a.
Amway
c.
Equinox International
b.
Herbalife International
d.
Ikea
33. Which of the following is not a regulation discussed in the text?
a.
Germany requires stores to locate in downtown areas.
b.
France limits the use of promotional pricing.
c.
Belgium restricts the expansion of superstores and hypermarkets.
d.
All of the above are regulations discussed in the text.
34. Why do French companies rarely offer an extra product for free as a promotion?
a.
French consumers are suspicious of “free” items.
b.
Legal reasons make it difficult to offer high quality free items.
c.
European Union policies discourage the use of free promotions.
d.
Because demand exceeds supply for most consumer nondurables, promotions are
unnecessary.
35. Which regulation is not found in Germany?
a.
Retail stores must locate in downtown areas.
b.
Promotional pricing is limited.
c.
It is illegal to offer three products for the price of two.
d.
Hypermarket store hours are limited to protect smaller stores.
36. Why are bugs on fruit important to consumers in the Philippines?
a.
Fruit with bugs is cheaper, which is important for lower income consumers.
b.
Bugs indicate the absence of dangerous pesticides.
c.
Bugs indicate that the fruit is ripe.
d.
Bugs are believed to increase the “positive energy” of fruit.
37. Why do certain stores, for example an antique store selling masterpieces, charge an admission price?
a.
The admission price serves as another source of revenue.
b.
In some countries, it is a legal requirement for stores selling masterpieces and national
treasures.
c.
It adds to the prestigious image of the store.
d.
The admission price ensures that individuals permitted to enter can actually afford the
products sold there.
COMPLETION
1. In the process of internationalization, many retailers are subscribing to the current trend of
consolidation in the ____________________ and general merchandise sectors.
2. _________________________ is defined as all the activities involved in selling products and services
to final international consumers for their personal consumption.
3. ____________________ stores offer a narrow product line and deep assortment.
4. Mango, Zara, and Marks & Spencer are examples of ____________________ stores.
5. ____________________ stores offer a broad variety of goods and deep assortments.
6. _________________________ stores sell high volumes of merchandise, offer limited service, and
charge lower prices.
7. The all-purpose category is dominated by stores such as Wal-Mart and K-Mart in the U.S.
Internationally, this retailer category tends to draw a substantial portion of profits from its
____________________ section.
8. _________________________ are large specialty stores that carry a narrow variety of merchandise
and a deep assortment.
9. ____________________ retailers sell brand-name and designer merchandise below regular retail.
10. ____________________ retailers sell overruns, irregular products, as well as products from previous
seasons.
11. _________________________ usually offer high-turnover, brand-name goods at discount prices.
12. Neckermann and Quelle are well-known German ____________________ retailers
13. The ____________________ category includes combination stores and hypermarkets.
14. Unlike Kmart, Wal-Mart is expanding internationally using mainly a ____________________ format
15. The shockwaves sent by Wal-Mart’s extensive presence in Europe have led to substantial competitive
and ____________________ activity in the hypermarket category.
16. _________________________ require members to pay an annual fee and operate in low-overhead
facilities.
17. _________________________ carry limited lines of higher-turnover necessities.
18. _________________________ offer the possibility of a one-stop shopping experience.
19. Internet retailing, also known as interactive home shopping or ____________________ retailing, is
quickly becoming an important retail format.
20. ____________________ retailing allows local retailers to become international retailers without
having to make investments in store leases, aesthetics, or atmospherics.
21. In ____________________, there are so many vending machines that they interfere with pedestrian
traffic.
22. Regulations allow foreign retail joint ventures to operate in most cities throughout
____________________, but most rural areas are off-limits to international retailers.
ESSAY
1. Discuss the similarities and differences between U.S. and international department stores.
2. Discuss the trends in superstores.
3. Describe some of the obstacles that affect catalog retailing in developing countries.
4. Describe some of the legislation and regulations affecting international retailers.
5. How does taxation affect international retailers?