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Retail Management Exam 1 > Exam 1 > Flashcards

Exam 1 Flashcards

1
Q

Retailing

A

is the set of business activities that adds value to products and service sold to consumers
for their personal or family use.

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2
Q

How retailers add value?

A
  1. Provide assortment
  2. Break Bulk
  3. Hold inventory
  4. Offer services
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3
Q

Breaking bulk

A

offer products in smaller quantities tailored to individual consumers and household consumption patterns.

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4
Q

Holding inventory

A

consumers can keep a smaller inventory of products at home because they know local retailers will have the products available when they need them.

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5
Q

Forward integrations

A

manufacturers undertake wholesaling and retailing activities e,g,Nike

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6
Q

Backward integrations

A

when retailers perform some wholesaling and manufacturing activities E.g Macy

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7
Q

Providing service

A

make it easier for customer to buy and use products

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8
Q

Providing an assortment of products and services

A

enables customers to choose from a wide selection of products brands,sizes,and prices at one location

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9
Q

Vertical integration

A

firms performs more than one set of activities in the channel e.g Gap,Ralph Lauren, Nike,Macy

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10
Q

What is NAICS?

A

Six digit code assigned to every business .Codes developed by the U.S,Canada and Mexico

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11
Q

What is SEC?

A

A u.s government oversight agency responsible for regulating the
Securities markets and protecting investors. ( Four digital codes )

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12
Q

codes for retail

A

5600,5621,5651,5661

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13
Q

Variety (Breadth of merchandise)

A

the number of merchandise categories

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14
Q

Assortment(Depth of merchandise)

A

The number of items in a category (SKUs

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15
Q

Department stores

A

carry broad variety and deep assortment
Offer customer service
E.g neiman marcus,saks fifth ave

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16
Q

Discount Stores

A

Offer a broad variety of merchandise,limited service and lower prices
Offer both private labels and national brands
E.g walmart,target

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17
Q

Extreme Value Retailer

A

*Small discount stores that offer a limited merchandise assortment at very low prices
*offer a broad variety but shallow assortment of household goods,health and beauty
aids and groceries
*Dollar general,family dollars

18
Q

Specialty stores

A

focus on a limited number of complementary merchandise categories
Provides a high level of service
E.g. victoria secret,sephora,zara, and H&M

19
Q

Category Stores

A

offer Narrow but deep assortment
Barnes and noble,best buy,Ikea
Difficult to differentiate themselves (provide similar assortments)
Provide the same level of service

20
Q

Off-price retailer

A

aka closeout retailer
Offer inconsistent assortment of brand name merchandise at a significant discount off the
MSRP
*opportunistic buying
*T.J Maxx,Marshall,Home goods,Ross stores,Burlington

21
Q

Retail Strategy?

A

*types of merchandise
*variety and assortment of merchandise
*target market
*sustainable competitive advantage : an advantage over competition that can be maintained over a
long time

22
Q

Sustainable competitive advantage?

A

Sustainable competitive advantage?

23
Q

10-K

A

A corporate report to the shareholders documenting companies financial condition and operations
Over the previous year.

24
Q

10-Q

A

The standard calendar quarters that make up the year

25
Q

Income statement

A

summarize all income and expenses over given period (revenues,expenses,and profit)

26
Q

Balance sheet

A

reports company assets,liabilities and equity

27
Q

Cash flow

A

summarizes the amount of cash and cash equivalents entering and leaving a company

28
Q

ROI(Return on Investment)

A

appropriate financial performance (Investment & Profit)

29
Q

ROA(Return of Assets)

A

appropriate financial performance measure for retailers,profit return on all
The assets possessed by a firm (assets & Profit)

30
Q

What are the two integral parts of return on assets?

A

net profit margin
asset turnover

31
Q

Net Profit Margin %

A
  • The profits generated from each dollar of sales
  • If a retailer’s net profit margin is 5 percent, it generates income of $.05 (5 cents) for every dollar of merchandise or services it sells.
32
Q

Asset Turnover

A

This financial measure assesses the productivity of a firm’s investment in its assets and indicates how many sales dollars are generated by each dollar of assets.
*if a retailer’s asset turnover is 3.0, it generates $3 in sales for each dollar invested in the firm’s assets.

33
Q

What is strategic profit model?

A

Summarizes factors affecting a firms ROA

34
Q

Inventory turnover

A

*is a measure of the productivity of inventory:It is used to evaluate how effectively retailers utilize their investment in inventory
*Shows how many times, on average, inventory cycles through the store during a specific period of time(usually a year)

35
Q

Type input measures

A

assess the amount of resources or money used by the retailer to achieve outputs such as
Sales

36
Q

Type Output measures

A

assess the results of a retailers investment decisions
Ex. sales revenues,gross margin and net profit margin

37
Q

Type productivity measures

A

ratios of outputs to inputs
Determines hoe effectively retailers use their resources

38
Q

financial risk.

A

The ability to manage debt and fulfill it’s financial obligation

39
Q

How to assess the financial risks Of retailers?

A

*cash flow analysis
*current ratio
*quick ratio

40
Q

What is cash flow analysis?

A

= (cash and cash equivalents at end of period) reflects a company’s financial health- typically the more cash
that available for business operations the better.
*if the net income is much larger than cash flow the companies earnings quality is questionable,if cash
Flow exceeds the company and may be much healthier.

41
Q

current ratio

A

*Measure a company’s ability to pay short term obligations or those due within one year

42
Q

quick ratio

A

*Current assets less inventory divided by current liabilities

*The higher the ratio result the better financial health , the lower the ratio the more ikely the company
Will struggle with paying debts .

Retail Management Exam 1 (1 decks)

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