Test Bank for Retailing Management 5th Canadian Edition by Levy A+

Test Bank for Retailing Management 5th Canadian Edition by Levy A+

Test Bank for Retailing Management 5th Canadian Edition by Levy A+

Test Bank for Retailing Management 5th Canadian Edition by Levy A+

) The largest sectors in terms of retail sales are:

A) General merchandise and Clothing

B) Food, Beverage, and Automotive

C) Furniture and Pharmacies

D) Automotive and Building supplies

E) Pharmacies and Building supplies


2) Retail managers must make complex decisions including all of the following except:

A) Mission statement

B) Target markets

C) Training and motivating sales associates

D) Merchandise and services offerings

E) Retail locations


3) What is retailing?

A) It is the merchandising component of the retail mix

B) It is the set of business activities that adds value to the products and services sold to consumers for their personal or family use

C) It is the process of offering products in smaller quantities for consumer consumption patterns

D) It is the strategy retailers and vendors use to get products into the stores

E) It is the ability to offer enough variety in a store to encourage one-stop shopping


4) Which of the following businesses would be considered a retailer?

A) Your local hair salon

B) Tim Hortons

C) Canadian Tire

D) Air Canada

E) Your local hair salon, Air Canada, Tim Hortons, and Canadian Tire


5) Which of the following is most likely to be considered a retailer?

A) The Red Cross

B) A university

C) A radio talk show

D) The Better Business Bureau

E) All of the choices.


6) A retailer's role in the distribution channel is to:

A) sell to wholesalers

B) act as the liaison between manufacturers and wholesalers

C) negotiate with consumers through a series of focus groups

D) buy merchandise exclusively from the manufacturers

E) satisfy the needs of the consumers


7) is when a firm performs more than one set of activities in the channel.

A) Distribution channel

B) Horizontal integration

C) Channel diversification

D) Vertical integration

E) Vertical development


8) Prior Snowboards located in Whistler, B.C. manufactures many of the snowboards it sells in its retail outlet at its own factory in Canada. Prior Snowboards is practicing:

A) product-related marketing

B) globalization

C) wholesaling

D) demographic marketing

E) vertical integration


9) If a chain of florist shops opened a plant nursery to provide gift plants and cut flowers to all of its outlets within a 300-mile radius, the chain would be practicing:

A) service marketing

B) channel expansion

C) vertical retailing

D) vertical integration

E) horizontal expansion


10) What is the primary advantage for retailers to be vertically integrated?

A) Retailers can develop unique merchandise sold only in their stores; retailers can expand their services easily to the Internet because they can direct orders to the manufacturer; retailers have realized that to stay competitive, they must become vertically integrated; and customers preferring retailers that are vertically integrated are all advantages.

B) Customers prefer retailers who are vertically integrated

C) Retailers can expand their services easily to the Internet because they can direct orders to the manufacturer

D) Retailers have realized that to stay competitive, they must become vertically integrated

E) Retailers can develop unique merchandise sold only in their stores


11) A retailer that is vertically integrated:

A) has an excellent vertical relationship between corporate headquarters and stores

B) performs more than one function in the chain from manufacturing to sales to end user

C) performs only the function to end user

D) does not have frequent communication between buyers and managers

E) concentrates on selling to businesses only


12) Which of the following statements about retailers holding inventory is false?

A) Holding inventory reduces consumer's cost of storing products

B) By holding inventory, retailers can decrease the visual merchandising expenditure

C) Holding inventory in a store helps serve the customer's needs

D) By having inventory held in the store, consumers can hold less merchandise at home

E) Retailers keep inventory so that products are available when consumers want them


13) Grocers purchase bananas from several different tropical countries. When bananas arrive in the distribution centres across Canada, containers are reduced to amounts that are appropriate for store delivery. Once delivered to the stores, associates open the cartons and arrange the bananas for the consumer to select. Grocers are performing what function?

A) Holding inventory

B) Breaking bulk

C) Vertical integration

D) Providing services

E) Distribution


14) Providing assortments is an advantageous business activity because it:

A) enables the company to create a more informational and entertaining environment which would promote more sales

B) enables the customer to choose from a wide selection of brands, designs, sizes, and prices all in one store

C) enables the company to reinvest savings

D) enables the customer to stock up on the assortments because of their availability

E) enables the customer to save money by being able to shop in one store


15) One of the functions retailers undertake to increase the customer's perception of value is providing services. Which of the following would be an example of that activity?

A) Payment by debit cards

B) Clean washrooms

C) Well-lit parking lots

D) Trained salespeople to answer questions

E) Clean washrooms, payment by debit cards, trained salespeople, and well-lit parking lots are all appropriate examples.


16) One of the functions retailers undertake to increase the customer's perception of value is providing services. Which of the following would be an example of that activity?

A) Increasing employee pilferage

B) Selling on the Internet as an additional channel

C) Ignoring the competition

D) Performing a situation analysis

E) None of the available answers are correct.


17) A credit union holds and maintains detailed records of the banking activities of its members. Each quarter, the credit union provides its members a printout of banking activities, information about low rate loans and pre-owned automobiles. By contacting its members on a regular basis, the credit union is engaging in the business function of:

A) breaking bulk

B) providing assortments

C) providing services

D) holding inventory

E) financing


18) Retailing is the nation's largest industry in terms of:

A) promotions

B) competition

C) variety

D) employment

E) community involvement


19) Provinces with the highest retail sales in order are:

A) Ontario, Alberta, Quebec, and British Columbia

B) Ontario, Quebec, Alberta, and British Columbia

C) Quebec, British Columbia, Prairies, Ontario, and Atlantic Canada

D) Alberta, Atlantic Canada, Ontario, British Columbia, and Quebec

E) Ontario, British Columbia, Quebec, and Alberta


20) 72 percent of all retail businesses employ fewer than persons.

A) 10 B) 100 C) 25 D) 50 E) 5


21) The competition between the same types of retailers is called:

A) vertical integration

B) scrambled merchandising

C) intratype competition

D) indirect competition

E) intertype competition


22) Which of the following would be an example of intratype competitors?

A) IGA and Shoppers Drug Mart

B) Sears and La Senza

C) Future Shop and eBay

D) Walmart and Target

E) Loblaws and Amazon.ca


23) Best Buy (electronics) and Future Shop (electronics) are what type of competitors?

A) intertype

B) intratype

C) vertical

D) horizontal

E) indirect


24) Which of the following would be an intratype competitor for an IGA supermarket?

A) Subway

B) Walmart

C) Loblaws

D) Old Navy

E) Shoppers Drug Mart


25) What is Variety?

A) Variety is the number of different facets of the business plan

B) Variety is another term for scrambled merchandising

C) Variety is the number of different SKU's within a merchandise category

D) Variety is the number of different merchandise categories within a store

E) Variety is the number of different items in a category


26) When McDonald's opened its first restaurant, a hungry patron could order a hamburger, French fries and a shake. In those early years, McDonald's did not offer much:

A) variety

B) product depth

C) assortment

D) quantity

E) value


27) Chapters stores sell Godiva chocolates. By selling such products, Chapters is:

A) practicing intratype competition

B) offering deep product assortments

C) offering a good merchandise mix

D) practicing scrambled merchandising

E) offering what the market demands


28) The offering of merchandise not typically associated with the store type is called:

A) intratype competition

B) channel conflict

C) scrambled merchandising

D) vertical differentiation

E) product diversification


29) Delia was delighted to see that the local Shoppers Drug Mart carried milk, bread, and snacking crackers. Her delight indicates she has never seen:

A) a retail mix

B) a deep product assortment

C) this type of intratype competition

D) an acceptable merchandising mix

E) scrambled merchandising


30) Scrambled merchandising increases:

A) intertype competition

B) intratype competition

C) concentric diversification

D) vertical integration

E) horizontal integration


31) Which of the following would be an example of intertype competition?

A) A convenience store and a fast food restaurant

B) A specialty store and a department store

C) A department store and a pharmacy

D) A supermarket and a fresh flower stand

E) All answers provided are correct.


32) Walmart, Loblaws, and Future Shop are in what kind of competition?

A) indirect

B) channel

C) intratype

D) intertype

E) horizontal


33) Increasing intertype competition has made it harder for retailers to identify their:

A) competition

B) retail mix

C) merchandise mix

D) target market

E) none of the answers provided are correct.


34) The intensity of competition is greatest among retailers when:

A) they are located far from each other and target the same customer

B) they are located near each other and target the same customer

C) they are located far from each other and offer similar retail offerings

D) price dominates the retail mix

E) they are located near each other and offer similar retail offerings


35) As part of a retailing strategy, a retailer looks to changes in demographics and responds to these changes with their retail mix. The following are examples of demographic trends except:

A) the retirement of the Baby Boomers

B) the increased emphasis on customer service

C) the growth of the elderly population

D) the rising number of two-income families

E) the growth of minority segments


36) Once a retailer understands its environment, it needs to develop and implement a(n):

A) advertising plan

B) customer base

C) retail strategy

D) competitive strategy

E) functional strategy


37) Lydia owns the Shake Shack, a small ice cream shop on a busy beach boardwalk that specializes in a variety of milkshakes, malts and cones. She has identified her customer as a person walking on the boardwalkmostly vacationers who want something cool and quick with no frills. She located herself close to parking for easy access, unlike some of her competitors. Lydia seems to have developed a strong:

A) business concept

B) retail strategy

C) business plan

D) location strategy

E) selling strategy


38) When developing the for his new salon, George decided to obtain a long-term competitive advantage over other salons by offering longer hours, better prices, a well trained staff and half-price perm day every Thursday to attract customers.

A) focal point orientation

B) business cycle

C) retail strategy

D) marketing concept

E) selling concept


39) As the owner of a store specializing in men's suits, Isabella can use a retail strategy statement to identify all of the following except:

A) what services the shop will offer its customers

B) what types of suits the store will stock

C) the shop's target market

D) how the store will build a competitive advantage

E) the advertising campaign developed to sell last season's merchandise


40) How are retailers using point-of-sale (POS) terminals and Universal Product Codes (UPCs) affixed to merchandise? As a way to:

A) target the distribution plan

B) check its location strategy

C) gain a strategic advantage

D) create an advertising plan

E) set its retailing objectives


41) A business philosophy and set of strategies, programs, and systems that focus on identifying and building loyalty with a firm's most-valued customers is called:

A) customer relationship management

B) strategizing

C) customer decision area

D) intratype competition

E) customer loyalty


42) Which of the following statements about location strategy is true?

A) Location is the second most important characteristic that consumers examine when selecting a store

B) Location offers an opportunity to gain a long-term advantage over competitors

C) Location can never be used to gain any kind of long-term advantage over competitors due to retailing's low entry barriers

D) Consumers do not use convenience as a basis for selecting where to shop

E) The only two characteristics more important than location in the selection process of where to shop are price and sales promotions


43) The key strategic elements of the retail strategy are:

A) organizational structures

B) financial strategies

C) market strategies

D) location strategies

E) all of these


44) To implement a retail strategy, a retailer must develop a that satisfies the needs of its target market better than its competitors.

A) sales orientation

B) production orientation

C) situation analysis

D) retail mix

E) horizontal integration


45) Once a well-articulated retail strategy has been developed, the next step is to:

A) forecast future environmental trends

B) evaluate the results of the strategy

C) override the control mechanism

D) implement the strategy

E) confirm that environmental conditions have not changed


46) To implement a retail strategy, management must:

A) develop a retail mix that satisfies the needs of its target market better than its competitors

B) locate the ideal location

C) set pricing strategies and determine promotions

D) determine its target market and set retail objectives

E) develop budgets and acquire merchandise


47) The combination of factors retailers use to satisfy customer needs and influence their purchase decisions is called the firm's:

A) target market

B) marketing concept

C) retailing concept

D) retail mix

E) none of these


48) Which of the following is part of a retailer's retail mix?

A) Trained salespeople

B) Advertising

C) Services offered

D) Displays

E) All of these


49) Which of the following is not an element in the retail mix?

A) Competitive response

B) Merchandise assortments

C) Advertising and promotion

D) Customer service

E) Location


50) Which of the following parts of the retail mix can be utilized by a small hardware store?

A) Store location next door to a hospital

B) Bright lighting in the store, which makes it easier to read the messages

C) A new ad campaign that uses both radio and newspaper media

D) Attractive point-of-purchase displays at the ends of the store's aisles

E) All of these


51) Which of the following is not a part of the retail mix for a furniture store?

A) Competitive response

B) Furniture assortments

C) Television commercials

D) The location of the store

E) Store credit card


52) Retailers face ethical issues on a regular basis. The following are all TRUE except:

A) Ethics are the principles governing the behaviour of individuals and companies to establish appropriate behaviour and indicate what is right and wrong.

B) Today, advertising by doctors and lawyers in Canada is considered legal.

C) Offering bribes to overcome bureaucratic roadblocks is globally recognized as an unaccepted practice.

D) Some years ago, doctors and lawyers who advertised their services in Canada were considered unethical.

E) Offering bribes to overcome bureaucratic roadblocks is illegal in Canada.


53) Retailing offers today's graduates opportunities for careers in management as well as entrepreneurial opportunities. The following are all Canadian entrepreneurs and their Canadian originated retail outlets except:

A) John Holt and G.R. Renfrew - Holt Renfrew

B) Tim Horton - Tim Hortons

C) John Forzani - Forzani Group - Sport Chek

D) Samuel Cost and Sharon Conner - Costco

E) Eddie Black - Black's Cameras


ESSAY. Write your answer in the space provided or on a separate sheet of paper.

54) Best Buy purchases many of the CDs, PlayStation 2 games, DVDs and DVD players by the truckload, then sells them in smaller quantities to its stores where consumers are allowed to buy them one at a time. What business function is Best Buy performing?

55) When is the intensity of competition between retail stores the greatest?

56) What type of merchandising increases intertype competition?

57) The Reptile Shop is a pet shop that focuses on reptiles and their accoutrements for reptile lovers. The shop carries aquariums, warming rocks, toys and even live mice and crickets. It sponsors a reptile club where members can bring their pet to share with other reptile lovers. The store provides an inexpensive veterinary service. It even has a 3-month guarantee when you purchase a baby reptile. The Reptile Shop has created loyalty from its customers and continuously attracts new ones because of the services offered. What does this describe?

58) Why do retailers use point-of-sale (POS) terminals to read Universal Product Codes (UPCs) and electronic data interchange (EDI) to send sales and inventory information from computer to computer?

59) What is the retailer's role in the distribution channel?

60) List the four functions performed by retailers.

61) How do retailers increase the value consumers receive from their purchases?

62) With manufacturers legally able to sell direct from the factories, why should retailers exist?

63) Distinguish between intratype competition and intertype competition. Give an example of each.

64) Why would a drug store add novelty gifts, fresh bread, pre-wrapped sandwiches and milk to its product mix?

65) A chef wants to open a Chinese restaurant in the suburbs of a large city. How should she identify the competition?

66) Why do retailers consider customers as important when developing a retail strategy?

67) What are the three things identified by a retail strategy statement?

68) Why is location strategy important for both consumers and for competitive reasons?

Answer Key

Testname: UNTITLED1

1) B

2) A

3) B

4) E

5) B

6) E

7) D

8) E

9) D

10) E

11) B

12) B

13) B

14) B

15) E

16) B

17) C

18) D

19) B

20) E

21) C

22) D

23) B

24) C

25) D

26) A

27) D

28) C

29) E

30) A

31) E

32) D

33) A

34) E

35) B

36) C

37) B

38) C

39) E

40) C

41) A

42) B

43) E

44) D

45) D

46) A

47) D

48) E

49) A

50) E

Answer Key

Testname: UNTITLED1

51) A

52) C

53) D

54) Breaking bulk

55) When they are involved in intratype competition that is close to each other with similar retail offerings, such as in a shopping mall.

56) Scrambled merchandising

57) The store's retailing strategy. The paragraph describes the target market, the merchandise and services offered, and how it maintains a strategic advantage over competitors

58) These technologies allow retailers to have a better idea of what is selling and a way to quickly communicate that information to vendors so that replenishment can quickly occur. Additionally it gives the retailer a competitive advantage over retailers that do not work with current supply chain management systems.

59) The retailer's role in the distribution channel is to link manufacturers to consumers by directing their efforts to satisfying the needs of the ultimate consumers.

60) The four functions performed by retailers are (1) providing an assortment of products and services, (2) breaking bulk, (3) holding inventory, and (4) providing service and services.

61) Retailers increase the value consumers receive by (1) offering assortments of products and services, (2) breaking bulk, (3) holding inventory, and (4) providing service and services

62) In the retailing distribution channel, there are occasions when manufacturers sell directly to the ultimate consumer. While occasionally doing so, manufacturers mainly exist to manufacture products to satisfy the needs of wholesalers or retailers. Retailers exist because they direct their efforts and specialize in satisfying only the customer's needs.

63) Intratype competition refers to the competition between retailers with the same format. An example would be the competition between Loblaws and Sobeys for sale of fresh salmon. Intertype competition refers to the competition between retailers that sell similar merchandise using different formats. An example would be the sale of Maybelline mascara between Walmart and Shoppers Drug Mart.

64) The drug store is engaging in scrambled merchandising and has added these products and more, to appeal to a broader group of customers and to provide one-stop shopping for our time-starved society.

65) This question can have a variety of responses, but she could first look at the obvious and identify other Chinese restaurants near her location. Is her location the best? She should consider frozen Chinese entrees at nearby grocery stores. She should also consider the prices of the entrees she offers and compare them to the prices of other types of restaurants.

66) Retailers need to understand customers and how they are changing so that they can better satisfy their needs. Retailers need to know and understand why customers shop, how they select a store, and how they select from that store's merchandise.

67) A retail strategy statement identifies (1) the target market toward which the retailer will direct its efforts,

(2) the nature of the merchandise and services the retailer will offer to satisfy the needs of the target market, and (3) how the retailer will build a long-term advantage over its competitors.

68) (1) Location is typically the most important characteristic consumers consider when selecting a store. (2) A good location creates a long-term advantage over the competition.

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