Retailing Management Fifth Canadian Edition Test Bank

Exam Name___________________________________ MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question. 1) Compared to other food retailers, convenience stores 1) _______ A) Have less than 30% of their store devoted to food B) Have higher food prices C) Benefit from the high margins of gasoline sales D) Are experiencing slow growth in Asia E) Have a wide breadth and depth of merchandise 2) NAICS: A) Is a classification scheme where every North American business is assigned a 2) _______ 6-digit code B) Is an on-package series of thick and thin lines readable by check-out scanners C) Is a classification scheme used by retailers in Canada to monitor after-tax profits D) Is a number used to identify an item in a company’s inventory E) None of these 3) To compete against intrusions by other food retailing formats, conventional 3) _______ supermarkets are: A) Offering more private-label products B) Providing a better in-store experience C) Emphasizing fresh perishables D) Targeting health-conscious consumers E) All answers provided are correct. 4) Mark’s Work Wearhouse (clothing retailer) carries sizes for small, average, and big men, 4) _______ but all sizes are not available in all their stores. What should Mark’s do to communicate this message to their customers? A) They should train their sales associates to mention this when closing sales with each customer B) Mark’s should actively advertise these assortments to competitors C) Mark’s should advertise this by featuring big men on their Holiday Catalogue D) They should advertise big men’s merchandise on all of their newspaper supplements and commercials E) A database should be developed of those who purchase merchandise for big men and then Mark’s should market specifically to those shoppers 5) Frank was shopping for electric fuses for his fuse box. Flash Hardware sold them for 5) _______ $3.99 for a box of six, but when he went to the same retailer’s website, he found the same set for $2.99. Flash Hardware has a problem with: A) depth of merchandise B) price consistency across channels C) a pricing mistake by the store manager D) product consistency E) a communication problem between channels 6) Which of the following trends are changing the retail industry? A) Discriminating consumers B) Blurring boundaries among channels and formats 6) _______ C) Growing retailer concentration and power D) Growth in consumer data E) All answers provided are correct. 7) The spawning of new categories and retailers from supercentres to the Internet best 7) _______ demonstrates the: A) necessity to focus on competition B) tremendous need for better customer services C) necessity to go global with domestic retailers D) need for training and development programs E) growing diversity of retail formats 8) The Canadian retail marketplace is dominated by a small number of large 8) _______ retailers–which term does this describe? A) globalization B) concentration C) diversity D) development E) Americanization 9) Because the only merchandise category at the Futon Shop is double-sized futons, the 9) _______ Futon Shop can be said to have no: A) need for customer service B) variety C) product depth D) inventory control E) shrinkage 10) Each different item of merchandise in a retail store is called a/an: A) consumer offering B) store counted item (SCI) C) economic unit D) stock keeping unit (SKU) E) stored and keyed unit (SKU) 10) ______ 11) Pinch-A-Penny sells a variety of pool maintenance supplies including filters, chemicals, 11) ______ lights, skimmers, and pool toys. Pinch-A-Penny can be said to have: A) breadth of merchandise B) retail mix C) complete retail offering D) depth of merchandise E) supply standard 12) Variety is often referred to as the: A) depth of merchandise B) complete retail offering C) store’s supply standard D) breadth of merchandise E) retail mix 12) ______ 13) Depth of merchandise is often referred to as the: 13) ______ A) complete retail offering B) variety C) number of items within each product line D) retail mix E) object of the buy 14) My Favourite Quilt Shop carries quilting thread of every brand, colour and strength in 14) ______ cotton and poly-cotton blends. With reference to quilting threads, My Favourite Quilt Shop has: A) deep assortment B) broad variety C) good customer base D) few SKU’s E) little shrinkage 15) Isaac’s Men’s Store stocks 322 different styles and colours of ties. This assortment of ties 15) ______ can be referred to as Isaac’s: A) breadth of merchandise B) store’s supply standard C) depth of merchandise D) complete retail offering E) retailer mix 16) The Home Depot offers customers a huge selection of home improvement merchandise. 16) ______ As a result inventory investment: A) increases because they have to carry backup stock for each SKU B) increases because of the value of the assortment C) decreases because of the introduction of backup stock D) increases because of the increase in demand in the home improvement industry E) decreases because of the increase of the customer base 17) Which of the following is a self-service food store offering groceries, meat, and produce 17) ______ with limited sales of nonfood items? A) Convenience store B) Conventional supermarket C) Superstore D) Big-box food retailer E) All answers provided are correct. 18) Which of the following can be purchased at a hypermarket? A) Hotdogs and luncheon meat B) Electronics C) Photographic film development D) Sports equipment E) All answers provided are correct. 18) ______ 19) Al is the office manager for a large travel agency. He is responsible for maintaining the 19) ______ office supplies and works within a budget. This month, he needs to restock the agency’s #10 envelopes, ball-point pens, coffee, sweetener and plastic spoons. Where’s the best place for him to shop? A) Loblaws B) Costco C) Office Depot D) 7-Eleven E) Both B and C 20) Warehouse clubs: A) spend on visual displays B) have low turnover C) sell merchandise in a no-frills atmosphere D) provide extensive customer service E) have deep assortment within it’s merchandise categories 20) ______ 21) The primary issue facing supermarket and convenience store retailers today is: A) downsizing of middle management B) expiration dates on perishables C) price wars D) increasing level of competition from other types of retailers E) corporate development racing to catch up to store level 21) ______ 22) What is one way a convenience store can develop a sustainable advantage against 22) ______ competition? A) Sell prepared meals B) Close less convenient locations C) Nothing: convenience stores are becoming extinct D) Open more stores E) Extend hours of operation 23) Target and Walmart are examples of: A) variety stores B) discount stores C) specialty stores D) department stores E) convenience stores 23) ______ 24) To respond to a competitive environment, discount retailers are fighting back by: A) developing more private-label merchandise programs B) offering better customer service on the floor C) focusing on a EDLP strategy D) increasing assortments E) All of these. 24) ______ 25) Which of the following statements about discount stores is true? A) They tend to offer a broad variety of merchandise. B) They typically carry more brands and sizes in each category than department stores. C) They have greater depth of merchandise than department stores. D) They do not carry private-label merchandise. E) All answers provided are true. 25) ______ 26) Zara, a specialty store, produces how much of its own clothing line? A) None B) greater than 50% 26) ______ C) less than 40% D) 100% E) less than 20% 27) Category specialists: A) compete directly with off-price retailers B) are limited to clothing, office supply, pet supplies, and toy retailing C) offer a narrow variety but deep assortment of merchandise D) have little customer service E) rely on warranty sales to promote loyalty 27) ______ 28) Category specialists are sometimes called category killers because they: A) are located at stand-alone sites. B) have a broad merchandise mix and shallow assortment. C) are often located in dying shopping malls. D) can destroy a category of merchandise for other retailers. E) carry mainly technologically obsolete merchandise. 28) ______ 29) Rona and Home Depot are both category specialists for the home improvement industry. 29) ______ This means the stores: A) offer their customers narrow breadth and depth B) have excellent after-the-sale service C) use quick-response inventory management systems D) offer a narrow but deep assortment of merchandise E) appeal to the mature consumers 30) Category specialists in direct competition with each other typically compete on the basis 30) ______ of: A) cost of goods/retail price B) advertising C) distribution strategies D) product variety and assortment E) in-store promotions 31) A retailer that carries a broad variety and deep assortment of stock, offers customer 31) ______ services, and are organized into separate departments for displaying merchandise is called a: A) category killer B) department store C) discount retailer D) specialty retailer E) home improvement centre 32) Which of the following is an example of a department store? A) Future Shop B) Hudson’s Bay C) Mark’s Work Wearhouse D) Home Hardware E) Chapters 32) ______ 33) Which of the following categories are department stores moving away from offering? 33) ______ A) Toys B) Women’s apparel C) Home furnishings D) Kitchenware E) Accessories 34) Specialty stores that concentrate on health and personal grooming merchandise are: A) drugstores B) off-price retailers C) discount stores D) direct-mail retailers E) closeout retailers 34) ______ 35) Which of the following offers drive-through windows as a response to competition from 35) ______ discounters and grocery stores? A) Category specialists B) Specialty shops C) Big-box retailers D) Kiosks E) Drugstores 36) Off-price retailers: A) require suppliers to give them a variety of allowances and discounts. B) offer a consistent assortment of soft goods at low prices. C) give cash refunds. D) offer gift wrapping services. E) sell brand-name and even designer-label merchandise at reduced prices. 36) ______ 37) The two types of off-price retailers are: A) value retailers and closeout stores B) closeout and value stores C) outlet and closeout stores D) outlet stores and warehouse clubs E) warehouse clubs and closeout stores 37) ______ 38) Manufacturers view their outlet stores as advantageous over selling to other off-price 38) ______ retailers because: A) they do not have to offer rock-bottom prices B) it allows them some control over where their branded merchandise is sold C) they do not have to work with buyers of other companies D) they are interested in by-passing traditional retailers and wholesalers and sell direct to the consumer E) All answers provided are correct. 39) Kelly is a primary school teacher. She needed some small gifts for her students. She was pleased when she went in A Buck or Two and found she could buy colouring books, plastic scissors, pencil bags, puzzles, and games all priced at $1.00 each. A Buck or Two is an example of a: A) general merchandise retailer B) specialty retailer C) value retailer 39) ______ D) price killer E) price specialist 40) The retail format in which the retailers communicate with customers and offer products 40) ______ and services for sale over the Internet is called: A) television home shopping B) computerized shopping C) catalogue retailing D) electronic retailing E) direct selling 41) The main difference between direct-mail retailers and catalogue retailers is that 41) ______ direct-mail retailers are: A) usually considered junk mail and are discarded B) consistent with catalogue retailers in that they maintain long-term relationships C) businesses that have low start-up costs D) highly involved in database management E) primarily interested in a single sale from a specific mailing while catalogue retailers maintain relationships with customers over time 42) Direct selling: A) can be done over the telephone B) most often takes place in the home C) is a highly interactive form of retailing D) is mainly performed by independent agents E) All answers provided are correct. 42) ______ 43) Where are most direct sales made? A) Face-to-face, in a home B) On the job site C) At street festivals and craft shows D) Via a computer connection E) Over the phone 43) ______ 44) A ________ develops when a firm’s marketing program is designed to sell merchandise 44) ______ and services to other distributors rather than to retail customers. A) multilevel network B) general merchandise retailer C) pyramid scheme D) commission E) party plan 45) In a multilevel network, master distributors: A) may receive a commission on all merchandise purchased by the distributors in their 45) ______ network B) recruit other people to become distributors in their network C) are responsible for training the salespeople they recruit D) sell to customers in their network E) All answers provided are correct. 46) When multilevel direct selling becomes a pyramid scheme: 46) ______ A) the selling format is usually franchised B) the salespeople are no longer independent agents C) typical annual sales of products often double D) little merchandise is sold to end users E) the use of the party plan becomes more commonplace 47) Infomercials: A) do not usually solicit orders B) are not shown on cable television C) use testimonials rather than demonstrations to sell products D) are 30-minutes commercials E) are 60-seconds commercials 47) ______ 48) Ben saw a half-hour TV show with George Foreman on it. During the show Foreman 48) ______ was showing how to prepare a variety of foods so that they would be totally fat-free. Each item was prepared using a special cooker. During the show the TV audience were given several opportunities to buy the cooker. Ben was watching: A) a sales promotion B) an infomercial C) interactive electronic retailing D) direct selling E) outbound telemarketing 49) Martina was watching a Made-for-Television Movie on the Life Channel when she saw 49) ______ an ad for a series of books for people who want to save money on home repairs. She called and ordered the book on plumbing that was first in the series. Martina responded to: A) outbound telemarketing B) direct selling C) direct-response advertising D) interactive electronic retailing E) an infomercial 50) The major advantage of TV home shopping compared to catalogue retailing is: A) its ability to create time and place utility B) the easy return policy for unsatisfactory products C) the lack of federal regulation of the medium D) its ability to schedule when certain types of merchandise will be shown E) customers can see the merchandise being demonstrated on TV 50) ______ 51) When compared to catalogue retailing, TV home shopping has which of the following 51) ______ disadvantages? A) The difficulty inherent in returning unsatisfactory products B) The customer’s inability to look at products when they want to C) The lack of federal regulation of the medium D) The customer’s ability to watch products being demonstrated E) The ability to schedule when certain types of merchandise will be sold 52) The most common purchases from vending machines are: A) ice B) beverages and snack food 52) ______ C) cigarettes D) airplane insurance E) condoms 53) What do WestJet (airline), Four Seasons (hotel chain), Century 21 (real estate company), 53) ______ and Rogers Video (video outlet) have in common? A) These retailers have established long-term relationships with their manufacturers. B) They are all examples of off-price retailers. C) They sell tangible products. D) They have high operating margins due to the size of their inventories. E) They are all examples of service retailers. 54) How can a service retailer best cope with the some of the problems associated with the 54) ______ intangibility of service? A) Emphasize quality control. B) Increase staffing at peak demand times. C) Use mass production. D) Use low prices during off-seasons to help match supply and demand. E) Solicit customer evaluations and complaints. 55) Due to the ________ of services, service retailers like Disney, Famous Players, and Air 55) ______ Canada sometimes find it difficult to match supply and demand. A) perishability B) consumability C) compatibility D) inconsistency E) intangibility 56) Why do movie theatres sell tickets for an afternoon showing at a lower price than the 7 56) ______ p.m. showing of the same movie? A) To deal with the incompatibility characteristic of services B) To make sure the service offered in consistent C) To minimize inventory losses D) To deal with the intangible characteristic of services E) To deal with the perishability of services 57) Which of the following describes an advantage that independent, single-store 57) ______ establishments have over other forms of ownership? A) Economies of scale B) Bureaucratic operation C) Ability to respond almost immediately to market changes D) Very low set-up costs E) Distribution efficiency 58) A company operating multiple retail units under common ownership and usually has centralized decision making for defining and implementing its strategy is called a: A) franchise B) single-store establishment C) retail chain D) full-line discount stores E) wholesale-sponsored voluntary cooperative group 58) ______ 59) In a franchise contract, the franchisee pays the franchisor a: A) bonus if the sales quota is achieved B) start-up costs plus a monthly predetermined cash amount C) commission on all sales D) lump sum plus a royalty on all sales E) salary plus a variety of employee benefits 59) ______ 60) A retailer that sells merchandise and/or services through more than one channel is called 60) ______ a/an: A) computerized retailer B) multichannel retailer C) single-channel retailer D) direct seller E) electronic retailer 61) A multichannel retailer is one that: A) channels all assortments through the stores B) buys merchandise from multiple channels to sell in the stores C) is a combination of single-channel retailers D) works with other retailers who are in the channel E) sells merchandise or services through more than one channel 61) ______ 62) Which of the following retailers is the best example of a multichannel retailer? A) Susan and Michael’s Hair Salon B) The Keg restaurant C) 7-Eleven convenience stores D) Sears E) eBay 62) ______ 63) Which of the following is not a benefit of retail store channel shopping? A) Personal safety B) Touch and feel products C) Cash payment D) Personal service E) Browsing 63) ______ 64) Which of the following is a benefit of store channel shopping? A) The ability to make cash payments B) The ability to browse C) The touch and feel of products D) Personal service E) All answers provided are correct. 64) ______ 65) Margaret went to the mall on her lunch hour. While she was there, she witnessed a 65) ______ back-to-school fashion show in Target, saw an old friend, took a walk and watched the children play in the centre arena. What benefit of store shopping was Margaret enjoying? A) Touch and feel products B) Convenience C) Personal service D) Entertainment and social interaction E) Detailed information 66) Mobile device and smartphone retail application research indicates that smartphones: A) influence is expected to grow over the next few years, driven by advertisers’ desire 66) ______ for greater market share B) are most likely to be used for store-related shopping when the customer is close to the point of making a purchase C) are rarely used in conjunction with retailer’s apps D) are used more in convenience stores than in any other retail format E) none of these answers are correct 67) Multichannel retailers: A) should avoid offering uniquely relevant information based on proprietary data that 67) ______ the retailer has collected about their customers B) want to encourage channel migration C) want to encourage consumers’ collecting information about products and pricing on their channels and then buying the product from a competitor D) should consider promoting private-label or exclusive merchandise that can be purchased only from them E) cannot respond to the challenge of differences in local competition 68) Consumers are using their mobile devices to help their retail buying decisions in the 68) ______ following way. A) Compare prices with competing firms B) Find location and hours of a retailer. C) Read reviews about products and services. D) Look up product information. E) All apply. 69) Choose the term that best fits the following: 69) ______ Consumers can make informed decisions with the increased access to product information, price comparisons, and user reviews, and then widely share their experiences with others. A) Ubiquitous connectivity B) New age of marketing C) Growing retailer power D) Buying local, going green E) Empowered, discriminating consumers 70) Choose the term that best fits the following: 70) ______ Consumers want to consume in a responsible, sustainable way. Retailers are responding by embracing the issues and helping customers and suppliers do the same. A) Buying local, going green B) New age of marketing C) Empowered, discriminating consumers D) Growing retailer power E) Ubiquitous connectivity 71) Choose the term that best fits the following: With increasi 71) ng amounts of data availabl e on custome rs, their online activitie s, and their purchasi ng patterns, retailers are able to create more targeted marketi ng campaig ns. ___ ___ A) Ubiquitous connectivity B) Empowered, discriminating consumers C) New age of marketing D) Growing retailer power E) Buying local, going green 72) Choose the term that best fits the following: 72) ______ It has never been more critical for retailers to integrate digital opportunities into the shopping experience, with the Internet available at work, at home, and on the go (mobile). Digital and physical experiences are converging, with shoppers expecting interactive, value-added experiences anytime, anywhere, and through any channel. A) Buying local, going green B) Ubiquitous connectivity C) Empowered, discriminating consumers D) New age of marketing E) Growing retailer power 73) Choose the term that best fits the following: The top five grocery stores in Canada now have 67 percent share of the market, with Loblaw Companies Ltd. dominating with 29.9 percent. A) New age of marketing B) Growing retailer power C) Empowered, discriminating consumers D) Buying local, going green E) Ubiquitous connectivity 73) ______ 74) Choose the term that best fits the following: 74) ______ Physical stores turning into showrooms in the minds of consumers and the rise of online buying are forcing retailers to rethink their costly real-estate assets and merchandising formats. A) Explosion of consumer data B) Scientific retailing C) Maturing retail technologies D) Blurring boundaries among channels, formats, and brands E) Challenged store economics 75) Choose the term that best fits the following: 75) ______ Shoppers Drug Mart is selling food; Loblaws has in-house bank branches; and Indigo has Starbucks cafés in stores. Retailers are evolving into a more integrated business model where all channels share a common strategy for profitable growth. A) Scientific retailing B) Maturing retail technologies C) Challenged store economics D) Blurring boundaries among channels, formats, and brands E) Explosion of consumer data 76) Choose the term that best fits the following: 76) ______ By applying smart algorithms and deep, data-driven analytics to the massive amounts of data, retailers are able to maximize all aspects of their business, including pricing, assortments, shelf displays, staffing, and warehouse space. A) Challenged store economics B) Maturing retail technologies C) Explosion of consumer data D) Scientific retailing E) Blurring boundaries among channels, formats, and brands 77) Choose the term that best fits the following: 77) ______ The enormous amount of data generated by points of sale, social media, corporate websites, and tracking URLs is greater than the ability of many retailers to exploit the potential value of this input. A) Scientific retailing B) Maturing retail technologies C) Blurring boundaries among channels, formats, and brands D) Explosion of consumer data E) Challenged store economics 78) Choose the term that best fits the following: A wide range of maturing technologies is allowing companies to streamline backroom functions and increase efficiency, helping to offset higher labour costs. A) Explosion of consumer data B) Scientific retailing 78) ______ C) Challenged store economics D) Blurring boundaries among channels, formats, and brands E) Maturing retail technologies 79) Choose the element of the retail mix that best applies to the following: 79) ______ The United States, Canada, and Mexico have developed a classification scheme, called the North American Industry Classification System (NAICS), to collect data on business activity in each country. A) Price of merchandise B) Breadth and depth of merchandise offered C) Type of merchandise/services offered D) Level of customer service E) None of these apply 80) Choose the element of the retail mix that best applies to the following: 80) ______ Retailers may appeal to different customer needs and offer different assortments and varieties of merchandise and services. A) Price of merchandise B) Breadth and depth of merchandise offered C) Level of customer service D) Type of merchandise/services offered E) None of these apply 81) Choose the element of the retail mix that best applies to the following: 81) ______ Accepting credit and debit payment, providing parking, and being open at convenient hours. A) Type of merchandise/services offered B) Breadth and depth of merchandise offered C) Price of merchandise D) Level of customer service E) None of these apply 82) Choose the element of the retail mix that best applies to the following: 82) ______ What the customer ultimately exchanges for the merchandise or service received. A) Breadth and depth of merchandise offered B) Level of customer service C) Price of merchandise D) Type of merchandise/services offered E) None of these apply 83) As retailers try to satisfy today’s ever-changing consumer, many are realizing that big is not always better. Choose what is influencing this change. A) the Web is having a significant impact on consumer in-store expectations and shopping processes B) real estate is not always available for big-box players C) populations are shifting D) None of these apply. 83) ______ E) All of these apply 84) A retailer that offers a limited assortment of food and general merchandise with little 84) ______ service at low prices to ultimate consumers (members) and small businesses A) Supercentres B) conventional supermarket C) limited-assortment supermarket D) hypermarkets E) Warehouse Club 85) 160 000 to 200 000 square feet in size and offer a wide variety of food (30-40 percent) 85) ______ and non-food merchandise (60-70 percent). They are the fastest-growing retail category. A) Warehouse Club B) conventional supermarket C) Supercentres D) limited-assortment supermarket E) hypermarkets 86) A marketing strategy in which the retailer offers multiple ways for shoppers to buy its 86) ______ products, but with a stronger focus on a seamless approach to the customer experience through all available shopping channels. A) Direct Selling B) M-Commerce C) Omni-Channel D) Multichannel E) None of these apply 87) Choose the appropriate Mobile Retail Sales “moment” that best fits the following 87) ______ “findings”. Seventy percent of consumers are now leading their own shopping journey (becoming aware of products through means outside of retailer or brand communications). A) Purchase and Pay B) Browse and Research C) Select and Validate D) Find Inspiration E) Return and Service F) None of these apply 88) Choose the appropriate Mobile Retail Sales “moment” that best fits the following: 88) ______ The customer begins to match the inspiration to a group of physical products that meet his/her need. He/she gathers additional information on the options available for sale. A) Browse and Research B) Purchase and Pay C) Select and Validate D) Return and Service E) Find Inspiration F) None of these apply 89) Choose the appropriate Mobile Retail Sales “moment” that best fits the following: The customer continues to narrow down his/her consideration set, eventually reducing the choices to only a few options. A) Return and Service B) Browse and Research C) Find Inspiration D) Select and Validate E) Purchase and Pay F) None of these apply 89) ______ 90) Choose the appropriate Mobile Retail Sales “moment” that best fits the following: 90) ______ Thirteen percent of shoppers use the “buy online, pick up in store” (or BOPUS) method to purchase and pay for their items. Twenty-five percent of consumers indicate that this is their preferred method for receiving their purchases in the future. A) Select and Validate B) Browse and Research C) Find Inspiration D) Purchase and Pay E) Return and Service F) None of these apply 91) Choose the appropriate Mobile Retail Sales “moment” that best fits the following: 91) ______ The customer returns to the original place or channel of purchase to seek follow-up related to the item. A) Browse and Research B) Find Inspiration C) Return and Service D) Purchase and Pay E) Select and Validate F) None of these apply 92) Conventional supermarkets are differentiating their offerings. Choose the one that fits 92) ______ the following: Grocery stores are increasingly incorporating “food as theatre” concepts, such as open-air market designs, cooking and nutrition classes, demonstrations, babysitting services, and food tasting. A) offering more promotions B) offering more private-label brands C) emphasizing fresh perishables D) targeting health-conscious and ethnic consumers E) providing better in-store experience F) None of these apply. 93) Conventional supermarkets are differentiating their offerings. Choose the one that fits 93) ______ the following: Conventional supermarkets are also offering more natural, organic, and fair-trade foods for the growing segment of consumers who are health and environmentally conscious. A) offering more private-label brands B) emphasizing fresh perishables C) providing better in-store experience D) offering more promotions E) targeting health-conscious and ethnic consumers F) None of these apply. 94) Conventional supermarkets are differentiating their offerings. Choose the one that fits the following: The benefits to customers include having more choices and finding the same ingredients and quality as in national brands at a lower price. A) targeting health-conscious and ethnic consumers B) offering more promotions C) offering more private-label brands 94) ______ D) providing better in-store experience E) emphasizing fresh perishables F) None of these apply. 95) Conventional supermarkets are differentiating their offerings. Choose the one that fits 95) ______ the following: Food items are located in the areas around the outer walls of a supermarket, known as the power perimeter, that include dairy, bakery, meat, florist, produce, deli, and coffee bar. A) emphasizing fresh perishables B) providing better in-store experience C) targeting health-conscious and ethnic consumers D) offering more private-label brands E) offering more promotions F) None of these apply. ESSAY. Write your answer in the space provided or on a separate sheet of paper. 96) Which type of store is the most intense competitor for the discount store? 97) Name and describe four important differences in the nature of the offering provided by services retailers compared with merchandise retailers. 98) Explain why category specialists call themselves “category killers”? 99) What are some benefits that consumers may experience that shop in traditional stores compared to other formats like catalogues or the Internet? 100) Explain the difference between breadth of merchandise and depth of merchandise. 101) What are three issues retailers face when they want to integrate across multiple channels? 102) Department stores are diverse and can be categorized into 3 tiers. Describe each tier and give an example of a retailer (for each tier). 103) What are some of the primary reasons why a traditional retailer would evolve into a multichannel retailer? 104) What does a franchisor offer its franchisees? 105) Many people believe that department store retailing is on the decline. What are department stores doing in response to this? 106) Explain why it is so difficult to be successful in catalogue retailing. 107) List and explain at least four trends that are rapidly changing the retail industry. 108) List the main elements of the retail mix that are particularly useful for classifying retailers. 109) As retailers try to satisfy today’s ever-changing consumer, many are realizing that big is not always better. Explain and give examples to what is influencing this. 110) The primary issue facing food retailers in general, and supermarket and convenience store retailers in particular, is the increasing level of competition from other types of retailers List type of retailers that are competing with them and give examples. Explain and give examples how food retailers are responding to this treat. 111) Describe two approaches that multichannel retailers can use to reduce channel migration. Give an example of a retailers that apply these approaches. 112) Banks have a problem–more and more customers are not coming into their branches. Banking online or by phone is now the norm. In addition, there is competition from retailers (including Loblaws and Canadian Tire) offering banking services that include mortgages and loans that extend the customer relationship. Explain and give examples of how Banks are responding to his competition. 113) Explain and give examples of retail trend of “Blurring boundaries among channels, formats and brands. 114) Describe and give examples how specialty stores tailor their retail strategy towards their specific market segments. 115) Department stores’ overall sales have stagnated and market share fallen in recent years due to increased competition from discount stores and specialty stores and a decline in perceived value for merchandise and services. Explain and give examples to how department stores are responding to this to attempt to capture more market share. 1) B 2) A 3) E 4) E 5) B 6) E 7) E 8) B 9) B 10) D 11) A 12) D 13) C 14) A 15) C 16) A 17) B 18) E 19) E 20) C 21) D 22) A 23) B 24) E 25) A 26) B 27) C 28) D 29) D 30) A 31) B 32) B 33) A 34) A 35) E 36) E 37) C 38) B 39) C 40) D 41) E 42) E 43) A 44) C 45) E 46) D 47) D 48) B 49) C 50) E 51) B 52) B 53) E 54) E 55) A 56) E 57) C 58) C 59) D 60) B 61) E 62) D 63) A 64) E 65) D 66) B 67) D 68) E 69) E 70) A 71) C 72) B 73) B 74) E 75) D 76) D 77) D 78) E 79) C 80) B 81) D 82) C 83) E 84) E 85) C 86) C 87) D 88) A 89) D 90) D 91) C 92) E 93) E 94) C 95) A 96) The category specialist. 97) Intangibility Services are generally intangible–customers cannot see, touch, or feel them. They are performances or actions rather than objects. Simultaneous Production and Consumption Products are typically made in a factory, stored and sold by a retailer, and then used by consumers in their homes. Service providers, on the other hand, create and deliver the service as the customer is consuming it. Perishability Because the creation and consumption of services are inseparable, services are perishable. They can’t be saved, stored, or resold. This is in contrast to merchandise that can be held in inventory until a y to buy it. cust Inconsistency Merchandise is often produced by machines with very tight quality control so that ome customers are reasonably assured that, for example, all boxes of a cereal will be identical. Because r is services are performances produced by people (employees and customers), no two services will be read identical. 98) By offering a complete assortment in a category at low prices, category specialists can “kill” a category of merchandise for other retailers. 99) Browsing; touching and feeling products; personal service; paying cash; immediate gratification; entertainment and social experience. 100) Breadth of merchandise refers to the number of different merchandise categories a retailer offers. Depth of merchandise refers to the number of different items in a merchandise category. 101) Centralized customer database, consistent brand image, merchandise assortment and pricing. 102) The first tier includes upscale, high-fashion chains with exclusive designer merchandise and excellent customer service, such as Holt Renfrew in Canada and Nordstrom in the United States. Hudson’s Bay represents the second tier of upscale department stores, in which retailers sell more modestly priced merchandise with less customer service. The value-oriented third tier–Sears Canada–caters to more price-conscious consumers. 103) Several reasons include: The Internet gives them an opportunity to reach new markets; they can leverage their skills and assets to grow revenues and profits; an e-tail site overcomes some limitations of their traditional formats; an e-tailing site enables retailers to gain valuable insights into their customers’ shopping behaviour; they have an opportunity for increasing their “share of wallet.” 104) The franchisor provides assistance in locating and building the store, developing the products and/or services that will be sold, management training, and advertising. Additionally, the franchisor makes sure all outlets provide the same quality of services and products to maintain the reputation of the franchise. 105) Many department stores are lowering prices on some merchandise. Most are investing in the development of private labels brands. Certain departments are getting progressive face-lifts and Internet access is being added. 106) Catalogue retailing appears easy to manage as start-up costs are lower than say traditional bricks and mortar retailing. The reality is that it is challenging because catalogue retailers are competing against retailers that are multi-channelled. Mailing and printing costs are high and increasing. The time it takes to design, develop and distribute catalogues is too lengthy catalogue retailers can’t respond to trends and fashions fast enough. 107) Empowered, discriminating consumers. Consumers can make informed decisions with the increased access to product information, price comparisons, and user reviews, and then widely share their experiences with others. Explosion of consumer data The enormous amount of data generated by points of sale, social media, corporate websites, and tracking URLs is greater than the ability of many retailers to exploit the potential value of this input. Scientific retailing By applying smart algorithms and deep, data-driven analytics to the massive amounts of data, retailers are able to maximize all aspects of their business, including pricing, assortments, shelf displays, staffing, and warehouse space. Ubiquitous connectivity It has never been more critical for retailers to integrate digital opportunities into the shopping experience, with the Internet available at work, at home, and on the go (mobile). Digital and physical experiences are converging, with shoppers expecting interactive, value-added experiences anytime, anywhere, and through any channel. 108) Four elements of the retail mix are particularly useful for classifying retailers: type ise/services offered of breadth and depth of merchandise offered merc level of customer service hand price of merchandise 109) More and more North American retailers are turning to the smaller format concepts that have been trending in Europe, Asia, and Latin America. Real estate is not always available for big-box players; populations are shifting; and the Web is having a significant impact on consumer in-store expectations and shopping processes. Rona is moving to reduce the number of its big-box locations from 80 to 57 and is focusing its expansion efforts on smaller-format neighbourhood stores. 110) Other retailers such as department stores, drugstores, convenience stores, gas stations, and even dollar stores are increasingly displaying food items on their shelves. In addition, fast-food restaurants such as Subway sandwich shops have positioned themselves as a healthy food alternative. In response to these competitive pressures, convenience stores are taking steps to decrease their dependency on gasoline sales, tailoring assortments to local markets, and making their stores even more convenient to shop. To get gasoline customers to spend more on other merchandise and services, convenience stores are offering more fresh food and healthy fast food that appeals to today’s on-the-go consumers, especially women and young adults. For example, Mac’s combines a convenience store and takeout restaurant. Mac’s has ready-to-heat meals, a sandwich bar, salads, and a ready-to-eat section. 111) Two approaches that multichannel retailers can use to reduce channel migration are to (1) offer uniquely relevant information based on proprietary data the retailer has collected about the customers, and (2) promote private-label or exclusive merchandise that can be purchased only from the retailer. 112) In response, progressive banks are luring customers with plasma TVs, iPads, and comfy chairs to attract more profitable clients to invest in financial advisory services. TD Bank 113) Drugstores moved to high-end cosmetics (Loblaws and Rexall); grocery stores invaded the pharmacy business. 114) Retailers tailor their strategy by offering deep but narrow assortments along with knowledgeable sales staff. For example, West 49 retails action sports clothing that had its origins with young skateboard enthusiasts. West 49 has very specific strategies to make sure that it appeals to the under-16 demographic. For example, the mall is a perfect location for this retailer because the target age group does not drive and usually relies on a parent to drop them off at the shopping centre. 115) To deal with eroding market share, department stores are (1) attempting to increase the amount of exclusive merchandise they sell, (2) undertaking marketing campaigns to develop strong images for their stores and brands, and (3) expanding their online presence.