Berman Chapter1

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Retail Management: A Strategic Approach, 11e (Berman/Evans)

Chapter 1 An Introduction to Retailing

1) The largest company in the world based on sales is ________.A) ExxonMobil

B) Sears Roebc!") #al$Mart%) Mar!s & SpencerAnswer' "%i((' 1 age Re(' *S!ill' Terminology+"oncept

,) #hich o( the (ollowing acti-ities does not (it within the scope o( retailingA) medical ser-ices to (amiliesB) direct$to$home sales") -ending prchases by (actory wor!ers

%) sales to wholesalersAnswer' %%i((' , age Re(' *S!ill' Terminology+"oncept

/) #hich statement concerning retailing is correctA) Retailing acti-ities mst in-ol-e a store.B) Retailing acti-ities do not ha-e to inclde a retailer.") Retailing acti-ities cannot be per(ormed by a wholesaler.%) Retailing acti-ities in-ol-e goods0 not ser-ices.Answer' B

%i((' , age Re(' *S!ill' Terminology+"oncept

*) According to the %epartment o( "ommerce0 annal .S. retail store sales are abot ________.A) 2,33 billionB) 21.4 trillion") 2/.4 trillion%) 24.3 trillionAnswer' %%i((' 1 age Re(' 5S!ill' Terminology+"oncept

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4) Abot how many people are employed by traditional retailers in the nited StatesA) 11 millionB) 15 million") ,4 million%) /* million

Answer' "%i((' 1 age Re(' 9S!ill' Terminology+"oncept

5) %ata on .S. retail employment nderstates actal employment becase it does not inclde________.A) store or department managersB) part$time personnel") seasonal employees and nreported wor!ers in (amily bsinesses%) teenagers nder 1: who are (ll$time stdentsAnswer' "%i((' 1 age Re(' 9S!ill' Terminology+"oncept

9) 7n ,3390 the (or largest retailing companies ;in order o( siS "aremar!0 and ?roger") #al$Mart0 ?mart0 ?roger0 and @ederated %epartment Stores%) #al$Mart0 #oolworth0 ?roger0 and ?martAnswer' B%i((' 1 age Re(' 9S!ill' Terminology+"oncept

:) n the a-erage0 ________ percent o( e-ery sales dollar goes to grocery stores as payment (orthe acti-ities they per(orm.A) 1,B) 1:") ,:%) 43Answer' "%i((' 1 age Re(' 9S!ill' Terminology+"oncept

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1/) The sorting process helps (inal consmers throgh ________.A) allowing store creditB) pro-iding one$stop shopping con-enience") operating long hors%) pro-iding deli-ery ser-ices

Answer' B%i((' , age Re(' :S!ill' Terminology+"oncept

1*) The sorting process helps man(actrers by ________.A) paying on the basis o( when goods are shipped0 not soldB) o((ering an assortment o( goods that are collected (rom a large nmber o( sppliers") enabling one$stop shopping%) bying large orders at one timeAnswer' %%i((' , age Re(' :

S!ill' Terminology+"oncept

14) A retailer sells to cstomers throgh traditional retail stores0 mail$order catalogs0 and a #ebsite. This illstrates ________.A) -ertical integrationB) the sorting process") mlti$channel retailing%) the importance o( implse retailingAnswer' "%i((' 1 age Re(' :S!ill' Terminology+"oncept

15) Man(actrers can increase their power in a distribtion channel throgh ________.A) operating their own retail (acilitiesB) de-eloping dealer brands") expanding into (oreign mar!ets%) se o( intensi-e distribtionAnswer' A%i((' , age Re(' :$S!ill' Terminology+"oncept

19) Retailers ha-e increased their power in the channel o( distribtion de to ________.A) the growing nmber o( regional and national chains

B) the growth o( (ranchising as an alternati-e to independent ownership") the increased mar!et share o( national brands%) shopping center contract pro-isionsD limiting the range o( goods to be soldAnswer' A%i((' , age Re(' S!ill' Terminology+"oncept

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1:) "hannel relations tend to be the smoothest in ________ distribtion.A) exclsi-eB) selecti-e") intensi-e%) wide

Answer' A%i((' 1 age Re(' 13S!ill' Terminology+"oncept

1) 7n exclsi-e distribtion0 sppliers enter into agreements with ________.A) mltiple retailers that designate the latter as the only companies in speci(ied geographic areasthat are allowed to carry certain brands and+or prodct linesB) one or a (ew retailers that designate the latter as the only ones in speci(ied geographic areas tocarry certain brands or prodct lines") any retailer with ample credit that designates the latter to be allowed to carry certain brandsand+or prodct lines

%) a retailer stating that the retailer cannot carry any competing prodct lines as a precondition(or recei-ing (a-orable discontsAnswer' B%i((' , age Re(' 13S!ill' Terminology+"oncept

,3) A retailer o(ten mst limit its selection o( brands in ________ distribtion.A) wideB) intensi-e") selecti-e%) exclsi-eAnswer' %%i((' , age Re(' 13S!ill' Terminology+"oncept

,1) #hich (orm o( distribtion has the e((ect o( most se-erely limiting a man(actrerDs long$rnsales potentialA) intensi-e distribtionB) selecti-e distribtion") dal distribtion%) exclsi-e distribtionAnswer' %%i((' 1 age Re(' 13


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,9) The (irst stage in de-elopment o( a retail strategy shold be to ________.A) de-elop an o-erall long$rn planB) decide on the appropriate target mar!et") determine the type o( bsiness and speci(ic orientation o( the (irm%) implement an integrated strategy

Answer' "%i((' 1 age Re(' 13S!ill' Terminology+"oncept

,:) #hich (actor has had the greatest impact on the sccess o( Target StoresA) its low pricing strategyB) its de-elopment and se o( a retail strategic plan") its excellent physical distribtion systems%) its otstanding cstomer ser-iceAnswer' B%i((' 1 age Re(' 1,


,) #hich statement concerning Target StoresD retail strategy is not correctA) Target (ocses on consmers with middle incomes0 who are well edcated.B) Excellent cstomer ser-ice is an important part o( TargetDs sccess.") %espite its sccess0 Target has not done a good ob o( positioning itsel(.%) Target has ne-er lost sight o( its discont niche.Answer' "%i((' , age Re(' 1/S!ill' Terminology+"oncept

/3) The retailing concept is comprised o( ________.A) obecti-es0 implementable actions0 (eedbac!0 and strategy adstmentB) short$ and long$term obecti-es0 organi


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/,) #hich o( the (ollowing is not part o( the total retail experience (or a menDs clothing retailerA) o((ering store creditB) corporate (orm o( ownership") the storeDs atmosphere%) the brands carried

Answer' A%i((' , age Re(' 14S!ill' Terminology+"oncept

//) The identi(iable0 bt sometimes intangible0 acti-ities nderta!en by a retailer in connctionwith the basic goods and ser-ices it sells is re(erred to as ________.A) the retailing conceptB) the total retail experience") relationship retailing%) cstomer ser-iceAnswer' %

%i((' 1 age Re(' 15S!ill' Terminology+"oncept

/*) A characteristic o( relationship retailing isA) reliance on a data base o( crrent cstomersB) search (or new cstomers") constant bargaining between cstomers and sppliers%) low trst among channel membersAnswer' A%i((' , age Re(' 1:S!ill' Terminology+"oncept

/4) The nderlying principle o( a strategic approach to the stdy o( retailing is that a (irm needsto ________.A) be a low$cost pro-iderB) base all o( its decisions on retail research") be aware o( opportnities and constraints in decision ma!ing%) plan (or and adapt to a complex0 changing retail en-ironmentAnswer' %%i((' , age Re(' 1:$1S!ill' Terminology+"oncept

/5) #hich o( the (ollowing illstrates a retail transaction

A) a spermar!et prchasing a compter system to impro-e its in-entory managementB) a discont retailer signing a 13$year lease on a new store location") a wholesaler selling new windows to a home impro-ement center (or resale to homeowners%) an attorney prchasing a compter in connction with a hobbyAnswer' %%i((' , age Re(' *S!ill' Applied+"omprehensi-e+7ntegrati-e

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*,) A retailer is able to appeal to di((erent target mar!ets0 as well as reach consmers in mltipleplaces0 throgh engaging in ________.A) #eb salesB) mlti$channel retailing") relationship retailing

%) -ertical integrationAnswer' B%i((' 1 age Re(' :S!ill' Applied+"omprehensi-e+7ntegrati-e

*/) An example o( the contrasting -iewpoints o( retailers and man(actrers is a ________.A) man(actrer$sponsored cooperati-e ad-ertising programB) man(actrer attempting to increase national brand display space") man(actrer sponsoring training programs (or retail sales personnel%) man(actrer sponsoring point$o($prchase materialsAnswer' B

%i((' , age Re(' S!ill' Applied+"omprehensi-e+7ntegrati-e

**) "hannel cooperation and control is greatest when ________.A) intensi-e distribtion is tili


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*9) Retail price competition is generally lowest in ________ distribtion.A) dalB) exclsi-e") intensi-e%) selecti-e

Answer' B%i((' , age Re(' 13S!ill' Applied+"omprehensi-e+7ntegrati-e

*:) The greatest ad-antage to a man(actrerDs se o( exclsi-e distribtion is ________.A) a high le-el o( retail price competitionB) close channel cooperation") maximi


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4,) Geither channel cooperation nor long$term sales potential is maximi


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45) Retailers typically stdy prospecti-e locations in terms o( the characteristics o( shoppers0neighboring retailers0 pedestrian tra((ic conts by day o( wee! and hor0 and par!ing (acilities.This intensi-e analysis is de to the ________.A) importance o( implse sales to all retailersB) long$term natre o( retail leases

") high rent charged (or store locations%) need to attract consmers to a store locationAnswer' %%i((' , age Re(' 11S!ill' Applied+"omprehensi-e+7ntegrati-e

49) #hich statement concerning strategic planning is correctA) Strategic plans can be best sed by large retailers.B) Strategic planning shold be condcted on an annal basis.") Strategic plans shold emphasi


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53) The selection o( an appropriate target mar!et by a retailer relates to which element o( theretailing conceptA) goal orientationB) cstomer orientation") coordinated e((ort

%) -ale orientationAnswer' B%i((' , age Re(' 1*S!ill' Applied+"omprehensi-e+7ntegrati-e

51) An o(($price chain speciali


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5*) A maor disad-antage o( the retailing concept as applied to the de-elopment o( a retailstrategy is that it does not (ocs on ________.A) the de-elopment o( a coordinated strategyB) a (irmDs competiti-e ad-antages") speci(ic obecti-es sch as mar!et share or retrn on sales

%) the satis(action o( a (irmDs target mar!etAnswer' B%i((' , age Re(' 1*S!ill' Applied+"omprehensi-e+7ntegrati-e

54) A retailerDs (ocsing on store atmosphere0 cstomer ser-ice0 and exceeding a consmerDsexpectations is concerned with ________.A) the total retail experienceB) employee empowerment") relationship retailing%) a -ale orientationAnswer' A%i((' , age Re(' 14S!ill' Applied+"omprehensi-e+7ntegrati-e

55) #hich o( the (ollowing is not an important characteristic o( relationship retailingA) the continos monitoring o( cstomer satis(actionB) the de-elopment and maintenance o( a data base on all cstomers") the see!ing o( long$term bonds with existing cstomers%) the continos see!ing o( new cstomers to replace lost cstomersAnswer' %%i((' , age Re(' 1:S!ill' Applied+"omprehensi-e+7ntegrati-e

59) The se o( cstomer loyalty programs by a hotel chain that grants rewards0 sch as roompgrades and (ree rooms to loyal cstomers0 is an important part o( ________.A) the total retail experienceB) relationship retailing") cstomer ser-ice%) the retailing conceptAnswer' B%i((' , age Re(' 1:S!ill' Applied+"omprehensi-e+7ntegrati-e

5:) #hich retail strategy (ocses on existing cstomersA) the retail conceptB) the (nctional approach to retailing") relationship retailing%) transactional retailingAnswer' "%i((' , age Re(' 1:S!ill' Applied+"omprehensi-e+7ntegrati-e

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5) The (nctional orientation to the stdy o( retailing stresses ________.A) retail acti-itiesB) retail planning") adaptation o( retail strategy to match the retail en-ironment%) opportnities and constraints in decision ma!ing

Answer' A%i((' , age Re(' 1:S!ill' Applied+"omprehensi-e+7ntegrati-e

93) The strategic approach to the stdy o( retailing stresses ________.A) retail instittionsB) retail pro(its") legal isses%) retail planningAnswer' %%i((' , age Re(' 1:$1S!ill' Applied+"omprehensi-e+7ntegrati-e

91) Retailing is an intermediate stage in the channel o( distribtion.Answer' @AHSE%i((' 1 age Re(' *S!ill' Terminology+"oncept

9,) Mail and telephone orders0 direct selling0 and -ending machine sales are not part o( retailing.Answer' @AHSE%i((' , age Re(' 4S!ill' Terminology+"oncept

9/) The largest retailer in the nited States ;in terms o( sales) is Sears 8olding.Answer' @AHSE%i((' 1 age Re(' 9S!ill' Terminology+"oncept

9*) Throgh the sorting process0 a retailer collects an assortment o( goods and ser-ices (rom-arios sppliers and o((ers them to cstomers in small Cantities.Answer' TRE%i((' , age Re(' :S!ill' Terminology+"oncept

94) A retailer ses mltiple retail (ormats in mlti$channel retailing.Answer' TRE%i((' 1 age Re(' :S!ill' Terminology+"oncept

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95) Throgh the retail concept0 the retailer bridges the gap between the needs o( man(actrersand cstomers.Answer' @AHSE%i((' , age Re(' :S!ill' Terminology+"oncept

99) Retailers and their sppliers ha-e common -iewpoints relating to channel control0 theintensity o( distribtion0 and the setting o( (inal retail prices.Answer' @AHSE%i((' , age Re(' S!ill' Terminology+"oncept

9:) "hannel relations are generally smoothest when intensi-e distribtion is sed.Answer' @AHSE%i((' 1 age Re(' 13S!ill' Terminology+"oncept

9) Ienerally0 a man(actrer can maximi


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:*) Relationship retailing (ocses on the need (or continos attraction o( new cstomers.Answer' @AHSE%i((' 1 age Re(' 1:S!ill' Terminology+"oncept

:4) An instittional approach to the stdy o( retailing concentrates on the acti-ities that retailersmst per(orm.Answer' @AHSE%i((' 1 age Re(' 1:S!ill' Terminology+"oncept

:5) Man(actrers0 wholesalers0 and importers per(orm retail acti-ities when they sell goods andser-ices to (inal consmers.Answer' TRE%i((' , age Re(' *S!ill' Applied+"omprehensi-e+7ntegrati-e

:9) The sorting process allows man(actrers to speciali


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,) Exclsi-e distribtion decreases price competition among retailers.Answer' TRE%i((' 1 age Re(' 13S!ill' Applied+"omprehensi-e+7ntegrati-e

/) Retailer spport (or a man(actrer is greatest in exclsi-e distribtion.Answer' TRE%i((' , age Re(' 13S!ill' Applied+"omprehensi-e+7ntegrati-e

*) "hannel con(lict is minimi


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133) The nderlying principle o( a strategic approach to the stdy o( retailing is that a retail (irmneeds to plan and re-ise its plans continally in order to adapt to a changing en-ironment.Answer' TRE%i((' , age Re(' 1:$1S!ill' Applied+"omprehensi-e+7ntegrati-e

131) %escribe how a man(actrer and a wholesaler can each engage in retailing acti-ity.%i((' 1 age Re(' *

13,) E-alate the implications o( the sorting process (rom the perspecti-es o( the man(actrer0the retailer0 and the consmer.%i((' 1 age Re(' :

13/) 7denti(y the maor pros and cons o( the se o( mlti$channel retailing by a clothing retailerthat sells designer apparel throgh both in$store and #eb$based otlets.%i((' , age Re(' :

13*) a. nder what circmstances shold a man(actrer tili


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111) %e-elop a chec!list to determine i( a maor department store chain practices relationshipretailing.%i((' , age Re(' 1:

11,) %istingish among instittional0 (nctional0 and strategic approaches to the stdy o(

retailing.%i((' 1 age Re(' 1:

Berman Chapter1

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