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Exam 14: Retailers, Wholesalers, and Their Strategy Planning

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Question 101

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In most countries,small limited-line retailers still account for the majority of all retailers.

A) True
B) False

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Question 102

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Limited-function wholesalers provide only some of the wholesaling functions.

A) True
B) False

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Question 103

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Warehouse clubs started the move to mass-merchandising.

Use this information for question that refer to the Centerville Retailers and Wholesalers case. Carol Lamb has lived in Centerville all her life.She owns a retail store that sells hobby and craft supplies.She bought the store after working there for 7 years.Carol has just been asked to head up the Retailers and Wholesaler Group of the Centerville Chamber of Commerce.The most active chamber members in her group are described below: Walden's Leather is part of a regional chain of stores that sells leather goods-mostly men's and women's clothing-with the upscale Walden's brand name.Walden's primarily relies on its own stores where knowledgeable salespeople offer great service.Walden products are also sold,on a limited basis,in some fine department stores. Publisher's Helper is a small business started by Audrey Yang that provides and stocks display racks for paperback books and magazines.Most retailers welcome the service Audrey provides,in part because she does her own research to determine which paperback books and magazines sell best in Centerville. Cuzco's is Centerville's alternative to Walmart.The store sells a wide variety of merchandise.The company used to concentrate its product mix on small appliances-but now Cuzco's carries any product that it can sell profitably.Its low prices stimulate faster turnovers and higher sales volumes. Games Unlimited sells video games.Jamie Carraway,who owns the local store,signed a contract with Games Unlimited and follows strict rules covering her store's operations and the Games Unlimited marketing strategy.She pays that company a fee for promotion it provides as well as commissions on her sales. Johnson's Health and Beauty Supplies sells cosmetics and other health and beauty products to retailers and salons throughout the greater Centerville area.It owns the goods it sells to these retailer customers,and it provides all the wholesaling functions they need. Valu Grocer is an independent grocery store that belongs to an organization sponsored by a large food wholesaler.The fifty stores grocery stores that share the Valu Grocer name are linked by contracts that include basic operating procedures,storefront designs,and joint promotion efforts. Reddy and Sons sells equipment for several different manufacturers of plastic molding in the Centerville area.It earns a commission from each manufacturer on the products it sells for that manufacturer,but it does not take ownership of the equipment it sells nor does it install the equipment. Katrina's Salon started out as a low-status,low-price,low-margin hair salon 15 years ago.After some success,the company moved into a nicer storefront,raised prices,and now operates in the middle of the market. Which of these businesses best fits the definition of a limited-function merchant wholesaler?

Mass-merchandisers have proved to be effective competitors in taking away department store customers.

Regarding retail sales in the U.S.,it is true that

A broker's "product" is market information.

______ take over the whole marketing job of producers,not just the selling function.

______ covers all of the activities involved in the sale of products to final consumers.

Retailers who follow a policy of "buy low and sell high" are practicing the "mass-merchandising concept."

Truck wholesalers may provide almost the same services as full service wholesalers,but they usually specialize in perishable products that regular wholesalers prefer not to carry.

The major function of auction companies is to

A discount house is trying to meet all the customer's routine needs at a low price.

Most conventional retailers in the U.S.are ______.

Capitol Periodical Distributors is a wholesaler providing assistance to retailers that want to carry books and magazines.A retailer provides Capitol with a certain amount of floor space,and Capitol uses the space to install display racks.Capitol fills the racks with magazines and books that would be suitable for the retailer's target market.Every week a representative from Capitol comes in to remove any outdated publications and refill the racks.This practice helps the retailer serve its customers better than if the retailer tried to manage the books and magazines itself.Capitol Periodical Distributors is a

Will Bishop sells a wide assortment (in small quantities) of "emergency" home repair items (fuses,electrical tape,small packets of nails) to grocery and convenience stores.He owns the products he handles,and displays them for his customers.Bishop is a

Expanded assortment and/or reduced margins and service are characteristic of ______.

______ are basically manufacturers' agents who specialize in international trade.

"Scrambled merchandising" refers to the practice of conventional retailers handling many products within a limited-line,even though many of these products have to be sold at a low profit.

Which of the following statements about wholesaling is NOT true?