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Retailing > Final Exam > Flashcards

Final Exam Flashcards

1
Q

What is Site Selection?

A
  1. Investigate alternative trading

2. Determine what is desirable

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2
Q

Types of Locations

A
  • Isolated Store- free standing, no adjacent retailers
  • Unplanned business district- 2 or more stores situated together in such a way that total arrangement/mix of stores are not due to prior long range planning
  • Planned business district- allows establishment of commercial shopping centers which conform to overall development
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3
Q

Advantages of Isolated Stores

ex. Walmart, Costco, 7-Eleven

A
  • no competition
  • low rental cost
  • flexibility
  • no rules
  • stores and big box
  • adaptable
  • easy parking
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4
Q

Disadvantages of Isolated Stores

A
  • no adjacent retailers
  • difficult to attract money
  • travel distance requirement
  • lack of variety
  • high advertising expense
  • no cost sharing
  • restricted zoning laws
  • self-built, no renting
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5
Q

Types of business districts

A

central, secondary, and neighborhood business districts

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6
Q

What is a central business district?

A

exists in great density, downtown, hub of retailing!

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7
Q

Adv of central

A

prices, store types, customer service, trans access, proximity to facilities

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8
Q

Disadv of central

A

inadequate parking, travel time, poor image of central cities, high rent, traffic, congestion, discontinuity of offerings

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9
Q

What is a secondary business district?

A

unplanned shopping usually bound by the intersection of 2 major cities

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10
Q

What is a neighborhood business district?

ex. dry cleaners, barber, liquor store, supermarket

A

appeals to needs of shopping/service needs

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11
Q

Adv of neighborhood business

A

good location, convenient hours, parking, less hectic

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12
Q

Disadv of neighborhood business

A

limited goods & services

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13
Q

___% of retail sales still completed at a brick&mortar

A

90%

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14
Q

Steps of choosing a store location

A
  • Evaluate: alternative geographic locations
  • Determine: whether to locate as an isolated store
  • Select: the store type
  • Analyze: alternate sites contained in the specific goods of services
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15
Q

String

ex. car dealers, restaurants

A

group of retailer stores w a similar/compatible product lines located on a street or highway

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16
Q

Adv if string

A

similar to isolation

competition at location

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17
Q

Planned Shopping Centers

A
  • architecturally unified commercial establishments that is centrally owned or managed
  • accompanied by parking facilities
  • designed/operated as a unit w balance elements
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18
Q

Adv of malls

A
  • well-rounded assortments
  • strong suburban populations
  • one-stop-shop for families
  • cost sharing
  • transportation access
  • pedestrian traffic population
  • popularity
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19
Q

Disadv of malls

A
  • limited flexibility
  • higher rent
  • restricted offerings
  • management group may need approval
  • competition
  • requirements for association
  • too many malls- lose traffic
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20
Q

Types of Planned shopping centers

A

Regional, Community, and neighborhood

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21
Q

Regional mall

A
  • mega mall
  • 1 to 2 department
  • 50-100 smaller stores
  • recreating the shopping variety of a central city in suburbia
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22
Q

Community mall

A
  • strip malls
  • bunch of department stores
  • category killer
  • several small stores
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23
Q

Neighborhood

A
  • small plaza

- supermarket with smaller stores

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24
Q

Straight Traffic

A

Places displays and aisles in a rectangular or gridiron pattern

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25
Q

Curving Traffic

A

Places displays and aisles in a free-flowing pattern

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26
Q

Retail balance

A

-mix of stores within district or center

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27
Q

When does retail balance occur?

A

balance occurs when the number of stores for each merchandising or service category id equal to market potential, proper mix of stereotypes

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28
Q

lease types

A

-Straight lease, percentage lease, graduated lease

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29
Q

Straight lease

A

pay a determined amount of rent

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30
Q

Percentage lease

A

pay % of sales or profit for rent

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31
Q

Graduated lease

A

precise rent increase over stated period 3% on rent each year

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32
Q

Pricing

A

profitability, satisfy customers, image consistency, meet ROI (return on investment)

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33
Q

Factors affecting retail price strategy

A

consumers, government, manufactures, current and potential

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34
Q

Insurance issues

A
  • rising premiums
  • reduced scope of coverage by insurers
  • fewer insurers servicing retailers
  • greater needs for insurance against environmental risks
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35
Q

outsourcing

A
  • retailer pays outside party to undertake or more of its operating functions
  • more retailers have turned to outsourcing
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36
Q

Crisis Management

A
  • there should be contingency plans for as many different crisis situations as possible
  • essential info should be communicated to all affected parties as soon as a crisis occurs
  • cooperation not conflict among the parties involved
  • responses should be prompt
  • chain of command clear
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37
Q

Resource Allocation

A
  • capital expenditures: long-term assets in fixed assets
  • Operating Expenditures: short term & administrative costs in running a business
  • Opportunity costs- weighing the benefits investing in or retailer vs. another
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38
Q

Operations blueprint

A
  • systematically lists all the operating functions to be performed
  • the retailer specifies in detail every operating function in form the open to close
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39
Q

Store format size and allocation

A

Prototype stores, rationalized retailing program, Top-down space management, Bottom-up space management

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40
Q

Top-down space management

A

most common, retailer starts with it total available space

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41
Q

Bottom-up

A

retailer begins planning at the individuals product level & proceeds to the category, total store, and overall company levels.

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42
Q

Budgeting

A
  • outlines a retailers planned expenditures for a given time based on expected performance
  • costs are linked to satisfying to get market, employee, goals
  • who has authority of approving
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43
Q

Human Resource Management

A

the process of recruiting, selecting, training supervising and compensating personnel

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44
Q

Cost of employee turnover

A
  • recruiting and hiring new employees
  • training costs
  • management time
  • pricing errors
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45
Q

Specific HR environment of retailing

A

-often a “1st job” for people, little experience
-retail personnel are visible to customer
grooming attitudes are important
now do you not discriminate
-a very diverse workforce is often in retail
-finalizing retail personnel can be challenging
-retail requires lots of HR help
-open long shifts- varying schedules
-willingness to work retail hours
-days, evenings, weekends, holidays

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46
Q

HR management process

A
  • recruitment
  • selection
  • training
  • compensation
  • supervisor
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47
Q

Keep in mind what in HR

A

diversity and labor loss, employee pricing

48
Q

Training

A

pertaining- company history, culture, chain of demand, job duties, on boarding, training programs

49
Q

Compensation

A

Direct- salary and common

Indirect- health care, profit sharing, paid time off, employee discounts, clothing allowance

50
Q

Supervision

A

the manner of providing a job environment that encourages employee accomplishment

51
Q

Job motivation

A

drive within people to attain work related goals
minimum expectations
desired goals

52
Q

Operation Management

A

efficient and effective implementation of policies/tasks necessary to satisfy firms

53
Q

Profit & Loss Statement

A

income statement, summary of retailers’ revenues expenses in time review of overall, specific costs, analyze profit

54
Q

Major components of profit law statement

A

Net sales- revenues received by retailer during given period
Cost of Goods Sold- amount a retailer pays to acquire the merchandising sold
Gross Profit Margin
Operating Cost- cost of running a business
Taxes
Net Profit After

55
Q

Balance Sheet

A

itemizes a retailers asset, liabilities and net worth at specific time

56
Q

Assets

A

liability + net worth

57
Q

Assets

A

any items a retailer owns w monetary value

58
Q

Liabilities

A

financial obligations a retailer incurs in operating a business

59
Q

Net worth

A

represents the value of a business after dedicating all financial obligations

60
Q

Funding Sources

A
  • mortgage refinance due to low interest rates
  • REIT (Retail-Estate-Investment, Trust) to fund construction
  • Company dedicated to owning and operating income- producing real estate
  • Initial Public Offerings (IPO)
  • Bankruptcy and Liquidations: allow retailers to safeguard against mounting debt and continue in business
  • Liquidation: firms ultimately go out of business
61
Q

Overall Pricing Objective

A

Market Penetration- sets low prices, in order to sell many units, seeks the price-oriented consumer

62
Q

Market Skimming

A

sets premium prices, attracts consumers less concerned w price

63
Q

Demand oriented pricing

A

prices set based on consumer decisions

64
Q

Price quality association

A

high price = high quality

low price = low quality

65
Q

Prestige pricing

A

assumes customers will not buy goods and services priced too low

66
Q

Cost oriented pricing

A

retailer sets a price floor, the minimum price acceptable so it can reach profit goals

67
Q

Customary pricing

A

establish pricing and have customers take them for granted
EDLP- Everyday Low Prices
EDV- Everyday Value
low prices offered everyday, usually excluded from additional sales

68
Q

Setting up a retail organization involves..

A

-tasks
-policies
-resources
-authority
-responsibilities
-rewards
to effectively and efficiently satisfy the needs of their target market, employees, and management

69
Q

Small independent retailers

A

owner/manager oversees

70
Q

Mazor plan of organization

A
  • developed by Paul Mazor in 1927

- divides all tasks into 4 basic functions

71
Q

What are Mazors 4 basic functions?

A
  1. Merchandising- buying, selling, ect..
  2. Publicity- PR, advertising, visual merchandising
  3. Store Management- operations
  4. Accountability- inventory, finance
72
Q

What is Mazor’s plan derivative

A
  • main store control
  • separate store organization
  • equal store organization
73
Q

Main store control

A

Head quarters oversees and operates different bunches

  • everything is centralized, managed, bunch managers hire, supervise employees
  • this format is best when there are only a few bunches
  • differences tend to be overlooked
74
Q

Separate store control

A
  • each branch has its own buying responsibilities
  • merch managers are placed directly in the bunches
  • coordination can be a problem among staff
  • this format is best if stores are large, dispersal, wide customer tasks
75
Q

Equal store organizations

A

-centralized buying= brunch units w status
-buying functions managed locally
-selling functions managed locally
-money department stores and chains today use this format
many functional divisions
central authority
standardized operations
limited decentralization allows branch to adapt to localities
GMM= Woman’s Apparel + Acc.
DMM= Designer Apparel Buyers/American

76
Q

Price Elasticity of Demand

A

the sensitivity of customers to price charges in terms of the quantities they will buy

77
Q

Price Inelastic

A

Large price change results in little change in amount purchased

78
Q

Market segments and their price sensitivity

A

Economic Consumers- usually seek lowest price
Status-Oriented- will pay more for things of status/prestige
Assortment oriented consumers- will shop retailers w the biggest assortment, not necessarily the lowest price
Personalized consumers- seek customer service above price
Convenience oriented- will shop retailers most convenient to them over service price

79
Q

The Gov. and Retail Pricing

A

Horizontal Price Fixing: agree to set prices

Vertical Price Fixing: manufactures control retail prices

80
Q

What does MSRP stand for?

A

Manufactured Suggested Retail Price

81
Q

Types of pricing

A

one price policy, flexible pricing, odd pricing, leader pricing, multiple unit pricing, and price lining

82
Q

odd pricing

A
  • retail pricing are set at levels below even dollar values

- type of psychological pricing for customer

83
Q

leader pricing “doorbuster sales”

A

-retailer advertises and sells selected items in their assortment at less than usual profit margins to increase customer traffic

84
Q

Retail Promotion

A

any communication by retailer that informs persuades and or reminds the target market about any aspect of that firm

85
Q

elements of a promotional mix

A

advertising
public relations
sales promotion
digital marketing

86
Q

objectives of advertising

A
  • lifting short-term sales
  • increasing customer traffic
  • developing, reinforcing, a retail image
  • informing customer about goods/services our company attributes
  • developing demand for private brands
87
Q

advantages of advertising

A

-attracts large audiences
-low cost per contact
-many alternatives available
-control over message contact
-message study possible
-editorial content surrounds ad
self service operations available

88
Q

disadvantages of advertising

A
  • standard messages lack flex
  • some media requires large investments
  • geographic flex limited
  • some media requires long lasting time
  • some media has high
  • message can be standardized
  • some media limit availability to provide detailed info
89
Q

advantages of media

A
  • legacy (papers, radio, tv)
  • outdoor media (bill boards, transit)
  • digital media (pay per click, affiliate marketing, native advertising)
90
Q

disadvantages of media

A
  • can only handle so much
  • high cost
  • doesnt get customers in store
  • self-service discouraged
91
Q

Types of sales positions

A
  • order taker: sales person performs sales functions

- order getter: actively involved with informing and persuading the customer

92
Q

Personal sales functions

A

greet - customer wants - show research - give presentation - demonstrate - questions - close

93
Q

Sales promotion

A

encompasses the paid communication activities other than advertising “everything else”

94
Q

Obj of sales promotion

A
  • increasing long term sales volume
  • maintaining customer loyalty
  • emphasizing novelty
95
Q

Adv of sales promotion

A
  • eye catching appeal
  • distinctive themes and tools
  • additional value for customer
  • draws in traffic
  • maintain customer loyalty
  • fun for customers
96
Q

Disadv. of sales promotion

A
  • difficult to terminate
  • possible damage retailers image
  • more stress on frivolous selling points
  • short term effects only
  • used as a supplement
97
Q

Public relations

A

any communication that fosters a favorable for a retailer

  • non-personal or personal
  • paid or non paid
  • sponsor controlled or not
98
Q

Publicity

A

any non personal form of relations whereby messages are transmitted through mass media, the time or space provided by the media
ex. model poses for brand, read an article

99
Q

PR obj.

A
  • increase awareness of the retailer
  • maintain or improve company image
  • show the retailer as a contributor to the publics quality of life
  • demonstrate innovativeness
  • presenting a favorable message believable
  • minimize total promotional costs
100
Q

PR adv.

A
  • image presented can be enhanced
  • more credible source
  • no cost
  • mass audience addressed
  • carry over effects
  • people pay more attention to articles to clearly identify
101
Q

PR disadvantages.

A
  • some retailers don’t believe in spending money on an image related company
  • little control over publicity image
  • more suitable for short run
  • costs for PR staff, planning activities and events
102
Q

Personal selling

A

oral communication with 1 or more prospective customers for the purpose of sale

103
Q

Personal selling obj.

A
  • persuade customer to buy
  • stimulate sales of impulse items or products related to customer basic purchases
  • complete customer transaction
  • feedback info to company decision making
  • improve and maintain customer satisfaction
104
Q

Adv. of personal selling

A
  • message can be adapted
  • high attention span
  • many ways to meet needs
  • better response
  • media feedback
105
Q

Disadv. of personal selling

A
  • can only handle so much
  • high cost
  • doesnt get customers in store
  • self-service discouraged
106
Q

Cut-case Displays

A

Inexpensive display in which merchandise is left in the original carton

107
Q

Dump bins

A

A case display that houses piles of sale clothing, marked-down books, or other products

108
Q

Types of Digital Marketing-

A

Search Engine Optimization (SEO)- the process of optimizing your website to “rank” higher in search engine results pages, thereby increasing the amount of organic (or free) traffic your website receives.

Content Marketing- creation and promotion of content assets for the purpose of generating brand awareness, traffic growth, lead generation, and customers, blog posts, infographics

Social Media Marketing- promotes your brand and your content on social media channels to increase brand awareness, drive traffic, and generate leads for your business.

Email Marketing- communicating with your audiences via email to promote content, discounts and events, as well as to direct people toward the business’s website.

109
Q

Digital Marketing

A

Encompasses all marketing efforts that use an electronic device or the internet. Businesses leverage digital channels such as search engines, social media, email, and other websites to connect with current and prospective customers.

110
Q

Point-of-Purchase Displays (POP)

A

Interior display that provides shoppers with information, adds to store atmosphere, and serves a substantial promotional role

111
Q

Atmosphere

A

The psychological feeling a customer gets when visiting a retailer

112
Q

Visual Merch

A

Proactive, integrated atmospherics approach to create a certain look, properly display products, stimulate shopping behavior, and enhance physical behavior

113
Q

Retail image

A

How a retailer is perceived by customers and consumers

114
Q

Gray Market Goods:

A

brand name products bought in foreign market or good store shipping from other retailers, low prices

115
Q

Prototype stores

A

multi outlets conform to relativity uniform construction, layout, and operators

Retailing (1 decks)

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