The first decision the retailer must make in planning a store is:
a. deciding what graphics to use.
b. how to allocate the store’s space.
c. deciding what type of fixtures to use.
d. deciding what type of lighting to use.
e. designing the logo.
According to Reilly, the _____ is the breaking point at which customers would be
indifferent to shopping at either of two cities.
a. point of inflection
b. point of gravitational pull
c. point of indifference
d. point of equal case
e. point of saturation
Publicity offers retailers all of the following advantages EXCEPT:
a. appeals to a mass audience.
b. is considered to objective.
c. is easy to manage and plan.
d. provides a high level of credibility.
e. is typically free.
Which of the following conditions does NOT allow a retailer to price above the market?
a. Offering an exclusive merchandise line
b. Maintaining extended hours of operation
c. Having a competitor with similar merchandise lines located next door
d. Having outlets in accessible and convenient locations
e. Providing ‘extra’ services
GIS can be used by the retailer for all of the following EXCEPT:
a. market selection.
b. site analysis.
c. analyzing the sales of competitors.
d. advertising management.
e. evaluation of store managers.
An attempt by a wholesaler to preserve a market for its products by strengthening the
retailers that it sells to is an example of what type of channel arrangement?
a. Retailer-owned cooperative
b. Wholesaler-sponsored voluntary group
c. Corporate system
d. Retail-sponsored marketing system
e. Franchised retail program
An important trend that has resulted in a shift to more collaborative relationships with
suppliers, employees, and customers is:
a. a whole system approach.
b. increased one-on-one conflict resolution.
c. increased distribution of handbooks/manuals.
d. expansion of the one-to-many model.
e. improved and lower cost of telecommunication.
The most familiar example of the grid layout is a(n):
a. automobile showroom.
b. jewelry store.
c. drugstore.
d. apparel shop.
e. furniture store.
Which of following is a reason why the promotion activities of the retailer’s channel
partners may sometimes conflict with the retailer’s goals?
a. Manufacturers expect the retailer to pay for all advertising.
b. Manufacturers want to promote the price and not the features of their products.
c. Manufacturers tend to be more short-term oriented than retailers with their ads.
d. Retailers are interested in telling the customers that they have the product available
for purchase at a convenient location, not what the product’s features are.
e. Manufacturers carry a larger variety and breadth of products than do retailers.
The dominance of Walmart can be attributed to Sam Walton’s realization that:
a. most of any product’s cost gets added after the item is produced.
b. consumers desire great selection and are willing to pay higher prices to obtain that
selection.
c. most consumers prefer to complete all of their shopping in one store to minimize
their overall shopping time.
d. most consumers would prefer to shop in large stores rather than small stores as they
believe that larger stores offer higher customer service.
e. the company’s primary focus should be on its profits.
The total cost valuation of a retailer’s inventory is $75,000 and the total retail valuation
is $130,000. Approximately how much of every retail sales dollar is made up of
merchandise cost?
a. 36.6 cents
b. 42.3 cents
c. 57.7 cents
d. 73.3 cents
e. $1.73
The primary problem with the pegging method of merchandise presentation is that it:
a. can be labor intensive to display and maintain.
b. makes small merchandise appear disorderly and haphazard.
c. cannot be incorporated into a wall system.
d. gives a low-cost, low-quality image to a store.
e. cannot work with gondolas.
The Card Shoppe had a gross margin last year of $2,000,000 and a net profit of
$300,000, while net sales were $2,500,000. What was The Card Shoppe’s net profit
margin for last year?
a. 12.0 percent
b. 15.0 percent
c. 20.0 percent
d. 68.0 percent
e. 80.0 percent
Last week, the Card Shop had 600 shoppers enter the store. Of those 600 shoppers, 120
actually made purchases. What would be the conversion rate for the store’s sales staff?
a. 2.0 percent
b. 20 percent
c. 25 percent
d. 200 percent
e. 250 percent
_____ are pallets of merchandise set out on the floor in front of the main shelves.
a. Endcaps
b. Secondary shelves
c. Circulators
d. Spine racks
e. Stack-outs
As a general rule, a retailer should strive to have its financial leverage between 3.0 and
4.0 times.
Power is the ability of one channel member to influence the decisions of the other
channel members.
Clerical error probably accounts for more stock shortages than theft.
Target market refers to the group of consumers that a retailer is seeking to serve.
Retailers that are not part of a contractual channel or corporate channel will probably
participate in different channels since they will need to acquire merchandise from many
suppliers.