Intro to Marketing - Retailing

Intro to Marketing Retailing Question Review 1. Snow White Toys sells Disney based products to children for their own enjoyment. What would Snow White Toys be characterized as? a. a wholesaler b. a retailer c. a business d. a distributor ANSWER: b 2. Which of the following is the best example of a retailer? a. the public library b. a radio station c. a real estate company d. an advertising agency ANSWER: c 3. Which of the following is one way that a retail store can be classified? a. according to its distribution method b. according to its inventory control c. according to its product assortment d. according to its decor and atmosphere ANSWER: c 4. Around the world, most merchandisers operate one or a few stores in their community, owned by a single person or partnership and not operated as part of a larger retail institution. What are these operators called? a. independent retailers b. chain stores c. franchise outlets d. specialty clubs ANSWER: a 1 5. What types of operations are small neighbourhood florists, shoe stores, and ethnic food markets most likely to be? a. franchise outlets b. membership clubs c. chain stores d. independent retailers ANSWER: d 6. The Gap Inc. is an American multinational clothing company. All of its stores are owned and operated as a group by head office. All of its administrative and purchasing tasks are also handled by head office. What are Gap’s stores called? a. home base stores b. independent retailers c. franchisees d. chain stores ANSWER: d 7. Costco carries automotive supplies and other products. How would you describe Costco? a. It is a chain store. b. It is a shop with a large product assortment. c. It is an independent retailer. d. It is a licensor. ANSWER: b 8. As a general rule of thumb, what will a retailer with a high gross margin also have? a. an inventory management system b. low prices c. salespeople trained in cross-selling techniques d. high prices ANSWER: d 9. Long & McQuade sells only guitars by Fender and ukuleles by Kala. It makes large margins on its products and ensures that its customers are dealt with by highly trained staff. What would Long & McQuade be characterized as? a. a drugstore b. a warehouse club c. a convenience store d. a specialty store ANSWER: d 2 10. Which of the following houses several departments under one roof, carries a wide variety of shopping and specialty goods, and provides a high level of service? a. a supermarket b. a specialty store c. a convenience store d. a department store ANSWER: d 11. Applying what you have learned about retailing, which type of retail store would typically have the highest labour costs? a. a warehouse club b. a department store c. an off-price retailer d. a discount store ANSWER: b 12. What type of retailer is the Running Room? a. a franchisee b. a category store c. a department store d. a specialty store ANSWER: d 13. When a store offers a wide variety of nontraditional goods and services under one roof, what is this called? a. giving the customer lots of choices b. confusing the customer c. scrambled merchandising d. a store that has everything ANSWER: c 14. What is a full-line discount store? a. a store that offers consumers very limited service b. a store that offers groceries and general merchandise c. a store that competes only on price d. a store that consumers love to benefit by ANSWER: a 3 15. This type of retailer concentrates in a given type of merchandise with a deep but narrow assortment. It is not only a type of store, but also a method of retail operations. What is it? a. a warehouse club b. a convenience store c. a specialty store d. a general store ANSWER: c 16. Which of the following statements best describes specialty stores? a. Specialty stores focus only on three or four categories. b. Specialty stores are not concerned with the distinctiveness of the merchandise or the store’s physical appearance. c. Specialty stores typically avoid price wars. d. A typical specialty store carries a wider assortment of specialty merchandise than department stores. ANSWER: c 17. The Grape Vine Market is a nearly 1,700-square-metre store offering highly collectible food and wine —along with some other culinary experiences, including a cooking school—all in a setting crafted to make shoppers feel comfortable. It stocks more than 5,500 different kinds of wine. From this description, what is Grape Vine Market? a. a hypermarket b. a factory outlet c. a specialty store d. a department store ANSWER: c 18. Harry Rosen is a retail chain of 15 high-end men’s clothing stores. A privately owned company, Harry Rosen accounts for 40 percent of the Canadian market in high-end menswear. The Harry Rosen stores carry the best of the best in menswear in Canada. How is Harry Rosen differentiating itself from other clothing stores? a. through cultural positioning b. through specialty retailing c. through unique products d. through store location modelling ANSWER: b 19. A manufacturer wants to introduce a line of handmade children’s clothing to the growing number of 4 professional women who are now having babies. The least expensive of these outfits will be $75. Which of the following types of stores would most likely support an effective product launch? a. an off-price retailer b. a specialty store c. a full-discount store d. a warehouse club ANSWER: b 20. The Big House is a large, departmentalized, self-service retailer that specializes in a wide assortment of food and some nonfood items? What kind of retailer is it? a. a supermarket b. a convenience store c. a membership wholesale club d. a discount store ANSWER: a 21. Winners and Marshall’s sell a variety of products. What type of retailers are they? a. specialty discount stores b. category killers c. off-price retailers d. full-line discount stores ANSWER: c 22. Real Canadian Superstore is a chain of retail outlets in Canada that are described as large, departmentalized, self-service stores that specialize in wide assortments of foodstuffs and limited nonfood items. Real Canadian Superstores would be classified as which of the following? a. off-price retailers b. discount stores c. wholesale clubs d. supermarkets ANSWER: d 23. Spar is Ireland’s largest supermarket chain. Which of the following is the most likely reason that Spar supermarkets sell all types of foodstuffs as well as nonfood products including a wide range of firearms and gun accessories? a. Demand for one-stop shopping often leads to scrambled merchandising. b. Fulfillment of the wheel of retailing hypothesis is important to Spar. c. Buying in bulk helps Spar to operate as a discounter. d. Spar is taking advantage of the growth of convenience merchandising. 5 ANSWER: a 24. According to your textbook, what is one way supermarkets establish long-term relationships with their customers? a. by avoiding any obviously ethnic appeal b. by limiting the number of nonfood items carried by the stores c. by using loyalty marketing programs d. by creating customer correlation studies ANSWER: c 25. Walmart sells products that fall under many different categories. These include groceries, seasonal, toys, and sporting goods to mention a few. What are they involved in? a. cross-selling b. trading up c. scrambled merchandising d. cross-docking ANSWER: c 26. Costco, Safeway, Metro, and other supermarket chains offer a variety of nontraditional goods and services such as DVD rental, flower shops, dry cleaning, and banking. What is this practice called? a. convenience merchandising b. specialty service c. trade-up positioning d. scrambled merchandising ANSWER: d 27. For consumers, the initial attraction of drugstores was the pharmaceuticals they carried, but now consumers can have their prescriptions filled at mass merchandisers, at supermarkets, and through the mail. What have drugstores done to remain competitive? a. raised their prices b. taken legal steps to prevent the sale of prescription drugs at supermarkets c. provided customers with value-added services d. introduced generic prescription medicines ANSWER: c 28. These self-service stores carry a limited line of high-turnover, high-priced goods and resemble miniature supermarkets. They are typically located near residential areas and are open long hours, seven days a week. What are they? a. specialty stores 6 b. wholesale stores c. convenience stores d. factory outlets ANSWER: c 29. Home Depot Fuel is the name of a chain of convenience stores owned and operated by The Home Depot. These stores typically sell gas and are located just outside The Home Depot warehouse store. What else can you presume about the Home Depot Fuel convenience stores? a. They carry a wide assortment of products. b. They carry a limited line of high-turnover goods. c. They compete on the basis of low price. d. They carry the same merchandise found in The Home Depot. ANSWER: b 30. Why are prices usually higher in convenience stores than in supermarkets? a. Convenience stores offer a wider variety of products. b. Convenience stores offer a higher level of customer services. c. Convenience stores offer better location, longer hours, and faster service. d. Convenience stores offer higher quality goods. ANSWER: c 31. Which of the following retailers compete on the basis of low prices, high turnover, and high volume? a. specialty stores b. discount stores c. general stores d. department stores ANSWER: b 32. Which of the following best describes discount stores? a. They compete on the basis of low prices, high turnover, and high volume. b. They sell high-priced, low-turnover products. c. They provide their customers with full service. d. They compete on the basis of assortment and depth. ANSWER: a 33. Costco carries a broad assortment of nationally branded hard goods (broader than a department store) and offers customers very limited service. What would Costco be classed as? a. a full-line discount store 7 b. a factory outlet c. a price cut store d. a specialty supercentre ANSWER: a 34. What is the term for the retailing strategy of using moderate to low prices on large quantities of products and lower service to stimulate a high turnover of inventory? a. specialty store positioning b. merchandise positioning c. the wheel of retailing d. mass merchandising ANSWER: d 35. Walmart utilizes a strategy of moderate to low prices on large quantities of products and lower levels of service to stimulate a high turnover of inventory. Walmart offers a wide variety of different product lines. What is Walmart an example of? a. a mass merchandiser b. a convenience store c. a franchising operation d. a specialty store ANSWER: a 36. What is the term for a retail operation that has a 8,300-square-metre facility, houses a florist, baker, bank, craft shop, photo finisher, dry cleaner, and pharmacy under the same roof as grocery and household items? a. a membership warehouse club b. a wholesale outlet c. a supercenter d. a mass merchandiser ANSWER: c 37. Hudson’s Bay’s Home Outfitters sells furnishings and uses self-service, discount prices, high volume, and high turnover of merchandise to their advantage. What are they are? a. a specialty discount store b. a factory outlet c. a mass merchandiser d. a membership club ANSWER: a 38. Glen’s Safety First! sells a huge assortment of firefighting and other safety equipment at greatly reduced prices. It offers customers few services and competes on the basis of moderate to low prices on the large quantities of merchandise it stocks. What is Glen’s Safety First! an example of? a. a full-line discount store b. a specialty discount store c. a general store d. a wholesale store ANSWER: b 39. Last year, over two million people visited Wine.com and bought 14,000 different fine wines at discounted prices. Wine.com shipped wine to over 100,000 customers generating more than $30 million in sales. Wine.com has since become the most trafficked wine site in the world. As an online retail operation, how would Wine.com correctly be labelled? a. a full-line discount store b. a category killer c. a department store d. an off-price retailer ANSWER: b 40. Why are specialty stores such as Office Depot, Bed Bath & Beyond, and Staples often called category killers? a. They can destroy the profit potential for a grouping of merchandise for other retailers. b. They are located at stand-alone sites. c. They have a broad merchandise mix and shallow assortment. d. They offer an exclusive category of merchandise. ANSWER: a 41. Which of the following sell a limited selection of brand-name appliances, household items, and groceries, usually in bulk on a cash-and-carry basis to those who belong? a. factory outlets b. wholesale discounters c. off-price discount retailers d. warehouse membership clubs ANSWER: d 42. Costco is a warehouse membership club. Which of the following best describes it? a. It sells only to ultimate consumers. b. It is a type of category specialist. c. Its merchandise is displayed without any frills and inventory turns over quickly. d. It has extensive merchandise depth, which it uses to create demographic positioning. ANSWER: c 43. Laura buys supplies for her catering business at a retailer that stocks a limited selection of items, which are sold in bulk on a cash-and-carry basis to those who belong. As she browses through a huge store, she buys flour, a set of muffin pans, and a package of paper towels as well as an assortment of fresh produce. Where is Laura most likely shopping? a. at an off-price discount retailer b. at a factory outlet c. at an industrial supply warehouse d. at a warehouse membership club ANSWER: d 44. Which of the following best describes off-price retailers? a. They are often able to take advantage of manufacturers’ faulty sales forecasting. b. They seldom stock brand-name merchandise. c. They are owned by the manufacturer of the products they sell. d. They offer very deep assortments. ANSWER: a 45. A publisher of books on holiday decorating, cooking, and crafts has to find a way to dispose of its overrun and unsold end-of-season output. To whom should the firm sell the remaining merchandise? a. convenience stores b. department stores c. supermarkets d. off-price discount retailers ANSWER: d 46. What is the term for an off-price retailer that is owned and operated by a manufacturer and carries one line of merchandise—its own? a. mass merchandiser b. factory outlet c. wholesale club d. discount store ANSWER: b 47. Well-known manufacturers such as Nike and Polo Ralph Lauren have decided the most profitable way to dispose of out-of-season and irregular stock is to open stores and sell their own merchandise. What type of stores are these? a. seasonal outlets b. factory outlets c. discount stores d. bargain basements ANSWER: b 48. Sarah hates shopping at malls during the Christmas rush. She much prefers to use catalogues, the internet or even vending machines. In fact this type of shopping is currently growing faster than in-store shopping. What is this known as? a. nonstore retailing b. customerization c. hypershopping d. virtual buying ANSWER: a 49. Which of the following statements best describes nonstore retailing? a. The nature of the communications between the retailer and the customer is the same in all forms of nonstore retailing. b. Nonstore retailing is currently growing faster than in-store retailing. c. The high growth rate for nonstore retailing is due to the growth of TV home shopping. d. Nonstore retailing is increasing at a rate lower than in-store retailing. ANSWER: b 50. What is the term for a low-profile yet important form of retailing in which consumers get products out of machines, and that accounts for $60 million worth of sales each year in Canada? a. automatic vending b. machine retailing c. direct marketing d. robotic purchasing ANSWER: a