C HAPTER 11 RETAILING AND WHOLESALING CRS Questions & Answers

Copyright 2007, Prentice-Hall Inc.11-2 The Kwik-E-Mart, as featured in The Simpsons TV show, is open 24 hours a day and offers a limited line of frequently purchased products. This type of store is called a: 1.Specialty store 2.Convenience store 3.Superstore 4.Department store

Copyright 2007, Prentice-Hall Inc.11-3 The Kwik-E-Mart, as featured in The Simpsons TV show, is open 24 hours a day and offers a limited line of frequently purchased products. This type of store is called a: 1.Specialty store 2.Convenience store 3.Superstore 4.Department store Convenience stores are typically located near residential areas, open long hours every day of the week, and carry convenience products such as diapers, milk, beer, etc.

Copyright 2007, Prentice-Hall Inc.11-4 Kmart, Toys ‘R Us, and Circuit City are examples of stores that would be classified as: 1.Specialty retailers 2.Self-service retailers 3.Limited-service retailers 4.Full-service retailers

Copyright 2007, Prentice-Hall Inc.11-5 Kmart, Toys ‘R Us, and Circle K are examples of stores that would be classified as: 1.Specialty retailers 2.Self-service retailers 3.Limited-service retailers 4.Full-service retailers Discount and convenience stores are self-service retailers. Customers who shop at these locations perform their own “locate-compare-select” process to save money.

Copyright 2007, Prentice-Hall Inc.11-6 Kar Krazy, an auto parts category killer, has just opened in your home town. Which of the following types of stores would most likely survive Kar Krazy’s assault on the market? 1.An auto parts department store that offers a little of everything. 2.A small store that sells parts for less than Kar Krazy. 3.A small store that caters to owners of high- performance sports cars. 4.A small self-service parts shop.

Copyright 2007, Prentice-Hall Inc.11-7 Kar Krazy, an auto parts category killer, has just opened in your home town. Which of the following types of stores would most likely survive Kar Krazy’s assault on the market? 1.An auto parts department store that offers a little of everything. 2.A small store that sells parts for less than Kar Krazy. 3.A small store that caters to owners of high- performance sports cars. 4.A small self-service parts shop. Specialty retailers that serve the needs of niche markets have the best chance of survival.

Copyright 2007, Prentice-Hall Inc.11-8 The ________ concept suggests that many new forms of retailing begin as low-margin, low- price, low-status operations, which take the place of other such retailers who have, over time, added services and moved upscale. 1.retail life cycle 2.merchant wholesaling 3.scrambled merchandising 4.wheel-of-retailing

Copyright 2007, Prentice-Hall Inc.11-9 The ________ concept suggests that many new forms of retailing begin as low-margin, low- price, low-status operations, which take the place of other such retailers who have, over time, added services and moved upscale. 1.retail life cycle 2.merchant wholesaling 3.scrambled merchandising 4.wheel-of-retailing This concept explains the initial success and later problems of department stores and supermarkets.

Copyright 2007, Prentice-Hall Inc The fact that retailers are increasingly selling the same products at the same prices to the same customers as their competitors is attributable to which of the following trends? 1.Retail convergence 2.Growth of nonstore retailing 3.Global retailing by major retailers 4.The rise of megaretailers

Copyright 2007, Prentice-Hall Inc The fact that retailers are increasingly selling the same products at the same prices to the same customers as their competitors is attributable to which of the following trends? 1.Retail convergence 2.Growth of nonstore retailing 3.Global retailing by major retailers 4.The rise of megaretailers Retail convergence is the coming together of shoppers, goods, and prices. The distinctions between discount, specialty and department stores are losing significance.

Copyright 2007, Prentice-Hall Inc Bloomingdale’s is known for running spectacular shows featuring goods from a certain country, such as India or China. These shows are examples of: 1.Service mix 2.Store atmosphere 3.Product assortment 4.Country range

Copyright 2007, Prentice-Hall Inc Bloomingdale’s is known for running spectacular shows featuring goods from a certain country, such as India or China. These shows are examples of: 1.Service mix 2.Store atmosphere 3.Product assortment 4.Country range Merchandising events featuring goods from a particular country is one method of differentiating the retailer by means of the product assortment.

Copyright 2007, Prentice-Hall Inc You want to open a coffee shop to compete with Starbucks, and must consider product assortment and services. This process entails making all the following decisions EXCEPT: 1.What will be the general atmosphere of your establishment 2.Where and how much you will advertise 3.What customer service training you will provide for employees 4.The types and amounts of coffee you will serve

Copyright 2007, Prentice-Hall Inc You want to open a coffee shop to compete with Starbucks, and must consider product assortment and services. This process entails making all the following decisions EXCEPT: 1.What will be the general atmosphere of your establishment 2.Where and how much you will advertise 3.What customer service training you will provide for employees 4.The types and amounts of coffee you will serve Advertising is a promotional decision.

Copyright 2007, Prentice-Hall Inc Shawn Ferguson represents several small wineries in the Napa Valley. He has contractual authority to sell the wineries’ entire output but never takes title to the wines. Shawn is a(n): 1.Agent 2.Broker 3.Merchant wholesaler 4.Cash-and-carry wholesaler

Copyright 2007, Prentice-Hall Inc Shawn Fan represents several small wineries in the Napa Valley. He has contractual authority to sell the wineries’ entire line but never takes title to or possession of the wines. Shawn is a(n): 1.Agent 2.Broker 3.Merchant wholesaler 4.Cash-and-carry wholesaler Specifically, Shawn would most likely be considered a manufacturer’s agent. Contracts with each winery would dictate pricing, order-handling, commission rates, etc.

Copyright 2007, Prentice-Hall Inc Truck wholesalers (truck jobbers) are a type of limited service wholesaler that does NOT: 1.Assume title and risk 2.Warehouse or carry inventory 3.Buy or build assortments 4.Offer credit or financing

Copyright 2007, Prentice-Hall Inc Truck wholesalers (truck jobbers) are a type of limited service wholesaler that does NOT: 1.Assume title and risk 2.Warehouse products or carry inventory 3.Offer delivery and transportation 4.Offer credit or financing Truck wholesalers carry and deliver semi-perishable merchandise – often food-related – that they sell for cash.

Copyright 2007, Prentice-Hall Inc Which of the following is NOT a trend that’s likely to continue in the wholesaling industry? 1.Vertical integration 2.Increase in services 3.Increase in the number of wholesalers 4.Geographic expansion of operations to the global market

Copyright 2007, Prentice-Hall Inc Which of the following is NOT a trend that’s likely to continue in the wholesaling industry? 1.Vertical integration 2.Increase in services 3.Increase in the number of wholesalers 4.Geographic expansion of operations to the global market Fierce resistance to price increases has winnowed out suppliers who are not adding value based on cost and quality, thereby decreasing the number of wholesalers.