CH04 Retail Institutions by Ownership

Question 1

retail institution (p. 91)

Answer 1

the basic format or structure of a business

Question 2

independent (p. 92)

Answer 2

an independent retailer owns one retail unit

Question 3

ease of entry (p. 92)

Answer 3

your ability to start selling in a new market and get a return on your investment, without having to overcome any major barriers to trade
- many independent retailers due to low capital requirements and relative simply licensing provisions

Question 4

chain (p. 94)

Answer 4

a chain retailer operates multiple outlets (store units) under common ownership

Question 5

franchising (p. 96)

Answer 5

involves a contractual agreement between a franchisor (a manufacturer, wholesaler, or service sponsor) and a retail franchisee, which allows the franchisee to conduct business under an established name and according to a given pattern of business
eg. tim horton’s, mcdo’s

Question 6

product/trademark franchising (p. 96)

Answer 6

when a franchisee acquires the identity of a franchisor by agreeing to sell the latter’s products and/or operate under the latter’s name

Question 7

business format franchising (p. 96)

Answer 7

there is a more interactive relationship between a franchisor and a franchisee
- the franchisee receives assistance on site location, quality control, accounting systems, startup practices, management training, and responding to problems besides the right to sell G+S

Question 8

constrained decision making (p. 98)

Answer 8

where franchisors limit franchisee involvement in the strategic planning process

Question 9

leased department (p. 100)

Answer 9

a department in a retail store–usually a department, discount, or specialty store–that is rented to an outside party

Question 10

vertical marketing system (p. 101)

Answer 10

consists of all the levels of independently owned businesses along a channel of distribution

Question 11

dual marketing (p. 102)

Answer 11

• a form of multichannel marketing
• engages in more that one type of distribution arrangement
• appeals to different consumers, increase sales, share some costs, and retain a lot of strategic control
• eg. agolde and the other company suits for double the price (i can’t remember the name)

Question 12

channel control (p. 102)

Answer 12

one member of a distribution channel dominates the decisions made in that channel due to the power it possesses

Question 13

consumer cooperative (p. 103)

Answer 13

a retail firm owned by its customer members, where they will invest, elect officers, manage operations, and share the profits or savings that accrue