A store with the largest trading area in a shopping center is a(n) _____.
a. parasite store
b. destination store
c. independent retailer
d. leased department
If selling expenses equal 40 percent of a retailer’s annual sales, its selling efficiency
would be _____.
a. 20 percent
b. 40 percent
c. 60 percent
d. 80 percent
A retailer’s success in reaching particular performance standards is best measured by
_____.
a. several key business ratios
b. the strategic profit model
c. asset turnover
d. the profit-and-loss statement
The information needs of retail managers are collected, organized, and stored on a
continuous basis in _____.
a. observation
b. retail research
c. an experiment
d. a retail information system
Capital and operating expenditure budgets do not reflect which cost?
a. insurance
b. opportunity costs
c. employee fringe benefits
d. mortgage interest
A stationery retailer generally prices portable copiers using a 30 percent markup. The
retailer expects to sell 125 portable copiers at the 30 percent markup. How many units
would it have to sell at a 25 percent markup to maintain the same gross profit?
a. 150
b. 175
c. 200
d. The answer cannot be determined from the information provided.
A retailer attempting to improve its selling efficiency from 60 percent to 70 percent
reduced its selling expense budget from $400,000 to $300,000. However, its new
selling efficiency was reduced to 50 percent. What happened?
a. Sales decreased from $1,000,000 to $500,000.
b. Sales decreased from $1,000,000 to $600,000.
c. Sales decreased from $1,000,000 to $700,000.
d. Sales increased from $1,000,000 to $1,250,000.
With the sales-productivity ratio, a retailer determines space needs by _____.
a. dividing merchandise into impulse and specific intent categories
b. assigning space on the basis of sales or profit per foot
c. calculating the amount of floor space necessary to carry and display a proper
assortment of merchandise
d. assigning goods into complementary and substitute categories
A retailer operates different store formats to appeal to different groups of customers.
This strategy illustrates _____ marketing.
a. target
b. concentrated
c. mass
d. differentiated
Franchisors can exclude franchisees from or limit their involvement in the strategic
planning process through _____.
a. franchisor training
b. franchisor troubleshooting
c. limiting purchases to the franchisor or approved vendors
d. quantity purchases
A retailer typically has half of its sales on credit; the balance of sales are by cash, check,
or debit card. Credit sales are payable in full in 30 days. The retailer’s collection period
is 25 days. The retailer has _____.
a. slow-turning accounts receivable
b. fast-turning accounts receivable
c. average-turning accounts receivable
d. high financial leverage
The U.S. retailer with the highest annual dollar advertising expenditure is _____.
a. Wal-Mart
b. Home Depot
c. Sears
d. Kmart
An example of an uncontrollable variable to a chain supermarket owner/manager is
_____.
a. legal restrictions relating to price advertising
b. store cleanliness
c. choice of an upscale target market
d. width and depth of assortment
Blocks and census tracts are important units in the Census of Population to small
retailers since _____.
a. this data is free
b. this data is timely
c. retailers can combine blocks and tracts to resemble their trading area
d. online computer tapes are available
Franchisors generally receive revenues from franchisees from all of the following
except _____.
a. initial franchise fee
b. quality control fee
c. percent of gross sales royalty fee
d. sale of goods and services to franchisee
A retailer selling fine pens can be positioned as a pen specialty store, an office supply
store, a stationery store, or a novelty store.
Leveraged buyouts are initially financed through the sale of common stock.
Lifestyles are easily identifiable and measurable population statistics.
Available secondary data are almost always adequate in solving a retailer’s data needs.
A retailer can buy a calculator for $2.50 and wants to obtain a 50 percent markup at
retail. The retailer should charge a $3.75 retail price.
In a dual vertical marketing system, manufacturers can cater to multiple target markets
with different distribution systems.
A significant benefit to independents (as compared to chains) is increased labor
productivity due to freedom from union work rules and seniority regulations.
Store location and operations, product and/or service offerings, store image and
promotion, and pricing are all controllable variables to a retailer.