Retail Entrepreneurship Exam Preparation Guide
Course Introduction
Retail Entrepreneurship explores the strategies and skills required to launch, manage, and grow a retail business in todays dynamic marketplace. The course covers critical topics such as identifying retail opportunities, developing business models, customer experience management, merchandising, and digital transformation in retail. Students will analyze case studies of successful retailers, learn about sourcing and supply chain fundamentals, and examine the impact of emerging technologies and consumer trends. Emphasis is placed on practical applications, from creating a comprehensive business plan to marketing and financial management, equipping aspiring entrepreneurs with the tools needed to thrive in the retail sector.
Recommended Textbook
Retail Management A Strategic Approach 13th Edition by Barry R. Berman
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20 Chapters
2240 Verified Questions
2240 Flashcards
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Chapter 1: An Introduction to Retailing
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Sample Questions
Q1) Mail and telephone orders,direct selling,and vending machine sales are not part of retailing.
A)True
B)False
Answer: False
Q2) Neither channel cooperation nor long-term sales potential is maximized in ________ distribution.
A) vertical
B) exclusive
C) intensive
D) selective
Answer: D
Q3) Retailers have increased their power in the channel of distribution due to ________.
A) the growing number of regional and national chains
B) the growth of franchising as an alternative to independent ownership
C) the increased market share of national brands
D) shopping center contract provisions' limiting the range of goods to be sold
Answer: A
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Page 3
Chapter 2: Building and Sustaining Relationships in Retailing
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Sample Questions
Q1) Retailers can quickly complete customer transactions,amass sales data,and adjust inventory through ________.
A) electronic data interchange
B) data warehousing
C) computer-assisted ordering system
D) point-of-sale scanning equipment
Answer: D
Q2) A customer is billed monthly on the basis of his/her outstanding cumulative balance in a(n)________.
A) debit account
B) open credit account
C) revolving credit account
D) option credit account
Answer: C
Q3) A retailer can reward its best customers through ________.
A) everyday low pricing
B) manufacturer-sponsored coupons
C) customer loyalty programs
D) contests and sweepstakes
Answer: C
Page 4
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Chapter 3: Strategic Planning in Retailing
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Sample Questions
Q1) Decision making relating to a retailer's daily and short-term operations involve
A) tactics
B) target market determination
C) competitive advantage determination
D) strategies
Answer: A
Q2) Intensive owner participation in a business is most likely to occur when ________.
A) a firm has strong financial controls
B) store hours are long
C) a business cannot be easily automated or mechanized
D) a retailer is well capitalized
Answer: C
Q3) Which characteristic is shared by both sole proprietorships and partnerships?
A) depersonalization
B) management succession
C) single taxation
D) complexity and costs in setting up
Answer: B
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Page 5
Chapter 4: Retail Institutions by Ownership
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Sample Questions
Q1) Hotels,carpet cleaning,and fast-food franchises are examples of a service sponsor-retailer franchise structural arrangement.
A)True
B)False
Q2) Chain store efficiency in multiple-store operations can be significantly reduced by
A) centralized buying that does not reflect regional and local preferences
B) a chain's performing wholesale functions
C) the use of computerized ordering and inventory management
D) use of national and regional media
Q3) A manufacturer with low company resources which seeks intensive distribution should utilize which vertical marketing system?
A) a retail cooperative
B) independent vertical marketing system
C) partially integrated system
D) fully integrated system
Q4) a.Develop a series of steps to organize a consumer cooperative.
b.What factors account for the lack of consumer cooperatives?
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Chapter 5: Retail Institutions by Store-Based Strategy Mix
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112 Flashcards
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Sample Questions
Q1) According to the wheel of retailing theory,retail innovators have what major advantage over traditional retailers?
A) being a low-cost provider
B) a more convenient location
C) superior service
D) exclusive merchandise lines
Q2) The retail life cycle stage characterized by market saturation is ________.
A) introduction
B) growth
C) maturity
D) decline
Q3) An advantage of the self-service concept as applied to both food-oriented and general merchandise retailers is ________.
A) increased impulse purchases
B) lower space requirements
C) improved pilferage control
D) lower fixturing expenses
Q4) Membership clubs sell merchandise to both wholesale and final consumers.
A)True
B)False
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Chapter 6: Web, nonstore-Based, and Other Forms of Nontraditional Retailing
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Sample Questions
Q1) Sales productivity in direct selling is comparatively low,due to the difficulty of reaching prospects.
A)True
B)False
Q2) a.Outline the strategic business advantages of a retailer's use of direct marketing.
b.What are the major limitations to direct marketing?
Q3) Direct marketing is increasingly used by store-based retailers.This illustrates ________.
A) multichannel retailing
B) downsizing
C) diversification
D) vertical integration
Q4) Outline the steps in conducting a direct marketing strategy.
Q5) Multichannel and omnichannel channel retailing both engage in ________.
A) nonstore retailing
B) store-based retailing
C) vertically integrated marketing
D) channel control retailing
Q6) Differentiate between the Internet and the World Wide Web.
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Chapter 7: Identifying and Understanding Consumers
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Sample Questions
Q1) Which statement concerning cross-shopping is correct?
A) Cross-shopping refers to consumers purchasing related items on the same shopping trip.
B) Cross-shopping refers to shoppers visiting multiple retail formats for a product category.
C) Cross-shopping refers to consumers visiting multiple retailers on the same shopping trip.
D) Cross-shopping refers to shoppers visiting either multiple retail formats for a product category or visiting multiple retailers on the same shopping trip.
Q2) Price,brand name,or store name are often used as cues in the ________ stage of the consumer decision process.
A) information search
B) purchase
C) evaluation of alternatives
D) problem awareness
Q3) a.Provide a demographic snapshot of the United States.
b.Identify its implications for an independent bookstore.
Q4) a.Differentiate among the three types of impulse purchasing.
b.Evaluate the retail opportunities from each type of impulse purchasing.
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Chapter 8: Information Gathering and Processing in Retailing
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Sample Questions
Q1) Marketing research in retailing involves ________.
A) primary data collection and analysis
B) secondary data collection and analysis
C) the collection and analysis of information relating to specific issues or problems facing a retailer
D) the gathering, storing, and retrieval of data in an orderly manner
Q2) The potential for interviewer bias is greatest in which survey technique?
A) mail survey
B) observation
C) telephone survey
D) personal survey
Q3) An example of internal secondary data is ________.
A) a new market research study conducted by an independent market research company
B) a new market research study conducted by the firm's market research department
C) a retailer's profit-and-loss statements
D) annual reports of competitors
Q4) Develop a semantic differential scale to determine Starbuck's retail image.
Page 10
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Chapter 9: Trading-Area Analysis
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Sample Questions
Q1) Under what condition would it be rational for the trading areas of two branch locations to completely overlap?
A) when each store has the same target market
B) when the retailer desires cost economics in promotion
C) when a retailer pursues a mass marketing strategy
D) when the retailer decides to switch store locations due to loss of a lease on the first store location
Q2) A newspaper stand in a hotel lobby can best be described as a ________ store.
A) fringe
B) parasite
C) destination
D) convenience
Q3) a.Differentiate among a primary,secondary,and fringe trading area.
b.What are the benefits of having a large fringe trading area? ...the limitations?
Q4) What type of retailer has a very large primary trading area?
A) impulse retailer
B) convenience retailer
C) destination retailer
D) parasite store
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Chapter 10: Site Selection
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Sample Questions
Q1) Which unplanned shopping district has at least one department store and a number of specialty and convenience stores?
A) string
B) central business district
C) secondary business district
D) regional shopping center
Q2) What factors need to be considered in the computation of pedestrian traffic counts for a children's clothing chain? ...vehicular traffic counts?
Q3) Planned shopping centers are characterized by ________.
A) low rental costs
B) central ownership and management and balanced tenancy
C) no adjacent retailers
D) a high concentration of office buildings and retail stores
Q4) A one-hundred percent location for an off-price retail chain is a(n)________.
A) isolated location
B) corner store location in a regional shopping center
C) location adjacent to a department store in a megamall
D) location adjacent to a used car lot in a string
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Chapter 11: Retail Organization and Human Resource Management
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Sample Questions
Q1) A firm determines that job candidates for part-time cashier positions that have B or better averages are three times more likely to successfully complete six months with a firm than those with averages less than C.Where in the human resource management process should the firm use this information?
A) job description
B) goal-oriented job description
C) application blank
D) weighted application blank
Q2) The minimum expectations/desired goals concept is most closely in accord with
A) the notion that only economic inducements really motivate employees
B) the notion that employees can be self-managers and assigned authority
C) high-task specialization
D) a tall organization
Q3) A buyer is responsible for purchases in a branch location.This illustrates a product classification method of classifying jobs.
A)True
B)False
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Chapter 12: Operations Management: Financial Dimensions
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112 Flashcards
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Sample Questions
Q1) a.Differentiate between zero-based and incremental budgeting.
b.Under what conditions would you use each technique?
Q2) A retailer that can double its asset turnover,while keeping its profit margin constant,doubles its return on assets.
A)True
B)False
Q3) All expenditure levels are questioned in ________ budgeting.
A) bottom-up
B) top-down
C) incremental
D) zero-based
Q4) A firm has accounts receivable of $400,000 and net sales of $2,000,000.Its collection period is five days.
A)True
B)False
Q5) A disadvantage associated with the use of leveraged buyouts is ________.
A) a high collection period
B) low asset turnover
C) the high debt-to-assets ratio
D) low return on net assets
14
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Chapter 13: Operations Management: Operational Dimensions
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Sample Questions
Q1) Rationalized retailing is often used in conjunction with ________.
A) micromerchandising
B) prototype stores
C) a top-down space management approach
D) a bottom-up space management approach
Q2) A characteristic of rationalized retailing programs is the ________.
A) encouragement of manufacturers to finance inventories
B) use of low-cost rental locations
C) use of used equipment and fixtures
D) high degree of centralized management control
Q3) A major difficulty with the use of prototype stores is the ________.
A) inconsistent store image
B) higher purchase costs for fixtures
C) inflexibility in dealing with special site characteristics
D) difficulty in applying standardized operating cost controls to different locations
Q4) Develop an energy management checklist for an off-price independent retailer which utilizes an isolated retail location.Be sure to focus on lighting,heating,and air-conditioning.
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Q5) What are the advantages and disadvantages of rationalized retailing programs?
Chapter 14: Developing Merchandise Plans
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Sample Questions
Q1) Distinctive,emulation,and economic emulation are three stages in the ________.
A) diffusion of innovation theory
B) fashion emulation theory
C) vertical trend theory
D) horizontal trend theory
Q2) The store type with the greatest depth of assortment is a specialty store.
A)True
B)False
Q3) The traditional product life cycle curve is bell-shaped.
A)True
B)False
Q4) What are the advantages and disadvantages of micromerchandising programs?
Q5) Product obsolescence characterizes the decline stage of the traditional product life cycle.
A)True
B)False
Q6) Decentralized buying organizations generally secure the best merchandise fit with each specific geographic area where a retailer has stores.
A)True
B)False
Page 16
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Chapter 15: Implementing Merchandise Plans
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Sample Questions
Q1) Some retailers excessively use chargebacks as a means of getting price reductions from vendors.
A)True
B)False
Q2) In a civil restitution law,________.
A) shoplifters cannot plea bargain the minimum state sentence for their crime
B) shoplifters must undertake community service as restitution for their crime
C) shoplifters must pay for stolen merchandise or face arrests and criminal trials
D) employees convicted of stealing merchandise must be registered with local police departments
Q3) Efficient consumer response (ECR)seeks to reduce inventory levels at manufacturers,wholesalers,and retailers using collaboration among these channel members.
A)True
B)False
Q4) A supermarket's developing a system to handle returnable bottles is an example of reverse logistics.
A)True
B)False
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Chapter 16: Financial Merchandise Management
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Sample Questions
Q1) The ending book value of inventory less ________ or plus ________ equals adjusted ending retail book value.
A) stock shortages at cost; stock overages at cost
B) stock shortages at retail; stock overages at retail
C) purchases; sales
D) markdowns; markups
Q2) If a firm's sales index in January is 128 and average monthly sales are $300,000,what is the January sales level?
A) $128,000
B) $300,000
C) $384,000
D) $428,000
Q3) A sales cushion is added to planned monthly sales in determining beginning-of-month planned inventory in the ________ method of inventory-level planning.
A) stock-to-sales
B) weeks' supply
C) percentage variation
D) basic stock
Q4) Explain the advantages and disadvantages of cost-based inventory systems.
Page 18
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Chapter 17: Pricing in Retailing
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Sample Questions
Q1) Some of the legal difficulties associated with the Robinson-Patman Act can be avoided through use of ________.
A) a one-price policy
B) variable markup pricing
C) the price-quality association
D) customary pricing
Q2) A retailer sells men's suits for $179,$229,$309,and $359.This illustrates ________.
A) price lining
B) leader pricing
C) odd pricing
D) bait advertising
Q3) A market penetration strategy should be used when a retailer ________.
A) believes in the price-quality association
B) seeks to maximize profits
C) seeks to maximize sales
D) seeks to differentiate its offerings through superior customer service
Q4) How do the price-quality association,prestige pricing,customary pricing,and odd pricing impact the price elasticity of demand?
Q5) Explain how markup pricing can include a demand and a cost component.
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Chapter 18: Establishing and Maintaining a Retail Image
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Sample Questions
Q1) Ensemble displays are commonly used in a ________ product grouping.
A) storability
B) market segment
C) purchase motivation
D) functional
Q2) The aim of experiential shopping is to ________.
A) increase impulse sales
B) convert shopping from a passive activity to a more interactive activity
C) simplify the purchase process
D) increase the percent of Web-based consumers who complete the transaction on a checkout counter
Q3) a.Describe the atmospherics-related advantages of Web-based retailers in comparison to traditional store retailers.
b.Describe the atmospherics-related disadvantages of Web-based retailers in comparison to traditional store retailers.
Q4) Discuss the advantages and disadvantages of the use of assortment displays,theme-setting displays,and rack displays for a men's clothing retailer.
Q5) a.Distinguish between retail image and atmosphere.
b.Explain how retail image is generated for a direct marketer.
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Chapter 19: Promotional Strategy
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Sample Questions
Q1) Develop a promotional budget for a family-oriented Italian restaurant located three blocks from your college/university.Use the all-you-can afford approach,the incremental method,and the objective-and-task method.While the restaurant is very popular for phone orders over the weekend,sales are comparatively slow on weekday evenings and during lunch times.
Q2) The short space and long lead time make outdoor advertising least appropriate for what form of advertisements?
A) institutional
B) pioneer
C) reminder
D) competitive
Q3) The major distinction between the canned sales presentation and the need-satisfaction approach is based on ________.
A) whether the salesperson tries to close the sale
B) the total time spent with a prospect
C) the method and amount of compensation
D) flexibility demonstrated by the salesperson in his or her sales presentation
Q4) Under what circumstances would a retailer utilize a massed advertising effort? ...a distributed advertising effort? Explain your answers.
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Chapter 20: Integrating and Controlling the Retail Strategy
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Sample Questions
Q1) Which of the following is not a fundamental factor in developing and implementing an integrated retail strategy?
A) reducing costs
B) scenario analysis
C) performance measures
D) defining productivity
Q2) Slotting allowance fees for a new product can be assessed through ________.
A) computation of a product's markup
B) use of a sales opportunity grid
C) assessing a product's sales potential
D) estimating holding costs
Q3) A horizontal retail audit ________.
A) evaluates the interrelationship of each retail strategy element
B) is specialized in nature
C) evaluates the overall environment facing a retailer
D) specializes in evaluating support services such as retail information systems
Q4) Major advantages in the use of outside auditors are objectivity and lack of time pressures.
A)True
B)False
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