Podcast
Questions and Answers
Retailing is only concerned with selling goods and does not involve services.
Retailing is only concerned with selling goods and does not involve services.
False
The shift of people from urban to suburban settings led to the rise of shopping centers.
The shift of people from urban to suburban settings led to the rise of shopping centers.
True
Shopping malls emerged due to the growing preference for having multiple stores located in one place.
Shopping malls emerged due to the growing preference for having multiple stores located in one place.
True
Online shopping is not considered a major trend in the evolution of retailing.
Online shopping is not considered a major trend in the evolution of retailing.
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Political conflict has no impact on importing and exporting goods in retailing.
Political conflict has no impact on importing and exporting goods in retailing.
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By the end of 2001, Business-to-Business (B2B) e-commerce had around $500 billion in transactions.
By the end of 2001, Business-to-Business (B2B) e-commerce had around $500 billion in transactions.
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The concept of strip shopping centers refers to a long line of stores in a single location.
The concept of strip shopping centers refers to a long line of stores in a single location.
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The use of technology is the last new frontier in retailing.
The use of technology is the last new frontier in retailing.
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The service sector accounts for a majority of the gross domestic product in industrialized countries.
The service sector accounts for a majority of the gross domestic product in industrialized countries.
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Success in retailing does not require any specific career prerequisites.
Success in retailing does not require any specific career prerequisites.
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Covid-19 had no significant impact on the retail industry in 2020.
Covid-19 had no significant impact on the retail industry in 2020.
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Understanding customer needs is vital for success in the retail industry.
Understanding customer needs is vital for success in the retail industry.
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The retailing process only involves the advertising of products made elsewhere.
The retailing process only involves the advertising of products made elsewhere.
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Service firms need to recognize the static role of customers in service operations.
Service firms need to recognize the static role of customers in service operations.
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Changes in markets and competition require effective strategic leadership for success.
Changes in markets and competition require effective strategic leadership for success.
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The final activities in retailing are only applicable to physical goods.
The final activities in retailing are only applicable to physical goods.
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Gross margin percentage is calculated by dividing inventory turnover by gross margin.
Gross margin percentage is calculated by dividing inventory turnover by gross margin.
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High-performance retailers produce financial results that are better than the industry average.
High-performance retailers produce financial results that are better than the industry average.
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Operating expenses include the cost of goods sold.
Operating expenses include the cost of goods sold.
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A low-margin/high turnover retailer operates with a high gross margin percentage and a low rate of inventory turnover.
A low-margin/high turnover retailer operates with a high gross margin percentage and a low rate of inventory turnover.
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The classification of retailers by size is becoming clearer due to advances in technology.
The classification of retailers by size is becoming clearer due to advances in technology.
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Clicks and mortar retailers only sell products online.
Clicks and mortar retailers only sell products online.
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The optional stock list allows each store in a retail chain to tailor its merchandise to local tastes.
The optional stock list allows each store in a retail chain to tailor its merchandise to local tastes.
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A high-margin/high turnover retailer operates with a low rate of inventory turnover.
A high-margin/high turnover retailer operates with a low rate of inventory turnover.
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Private label branding involves a manufacturer developing a brand name for a retailer.
Private label branding involves a manufacturer developing a brand name for a retailer.
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Channel advisors can only be retailers within the marketing channel.
Channel advisors can only be retailers within the marketing channel.
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Single-unit retailers typically have a more dispersed and varied inventory.
Single-unit retailers typically have a more dispersed and varied inventory.
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Retailers are now looking for new traditional retail sites as their primary strategy.
Retailers are now looking for new traditional retail sites as their primary strategy.
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The standard stock list means all stores in a retail chain stock the same merchandise.
The standard stock list means all stores in a retail chain stock the same merchandise.
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The U.S. Bureau of the Census uses six-digit NAICS codes to classify all retailers.
The U.S. Bureau of the Census uses six-digit NAICS codes to classify all retailers.
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NAICS code 513 is used for broadcasting and telecommunications.
NAICS code 513 is used for broadcasting and telecommunications.
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The category for wireless telecommunication carriers is represented by NAICS code 51332.
The category for wireless telecommunication carriers is represented by NAICS code 51332.
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NAICS code 513322 is assigned to the information category.
NAICS code 513322 is assigned to the information category.
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Retailers can be categorized according to the Census Bureau's three-digit system.
Retailers can be categorized according to the Census Bureau's three-digit system.
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The primary purpose of the Census Bureau's classification system is to identify competitors and customers.
The primary purpose of the Census Bureau's classification system is to identify competitors and customers.
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NAICS codes provide a method for classifying various types of establishments.
NAICS codes provide a method for classifying various types of establishments.
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NAICS code 51 includes only information technology firms.
NAICS code 51 includes only information technology firms.
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Study Notes
Introduction to Retailing
- E-commerce gained momentum, with the Business-to-Business (B2B) model reaching approximately $700 billion in transactions by the end of 2001.
- The service sector is a dominant part of the economy, constituting a significant portion of gross domestic product (GDP) in industrialized nations and driving new job creation.
- The COVID-19 pandemic in 2020 catalyzed rapid changes in retail, affecting customer needs, market dynamics, and competition.
- Emphasizes strategic leadership to navigate challenges and utilize opportunities in the evolving service industry landscape.
- Retailing needs to focus on understanding customer expectations and their evolving role in services.
Evolution of Retail Locations
- The migration to suburban areas led to the development of shopping centers where diverse stores are located centrally for community access.
- Shopping malls emerged as larger centers offering convenience year-round, exemplifying the under-one-roof shopping experience.
- Technology represents the latest frontier in retailing, influencing operations and customer engagement.
Retail Categories and Classification
- The U.S. Census Bureau uses the North American Industry Classification System (NAICS) to classify retailers, using specific three-digit codes.
- Clicks & Mortar retailers operate both online and in physical stores, leveraging economies of scale.
- Key retailer categories include:
- Single-unit retailers, who can tailor their offerings to local demand and create motivated staff.
- High-margin/high turnover retailers, operating with substantial inventory turnover and profitability.
Retail Strategies
- Standard stock lists maintain uniformity across retail chains, while optional stock lists allow tailored product assortments based on regional preferences.
- Channel advisors (or captains) influence other entities in the marketing channel to engage in coordinated activities, with retailers often fulfilling this role.
- Private label branding allows retailers to introduce their own brand names, enhancing market presence.
Location and Non-traditional Retailing
- Retail strategies have expanded to include non-traditional retail spaces that combine cultural experiences with entertainment or shopping.
- The method of classifying retailers by the number of outlets may overlook innovative retail strategies outside traditional formats.
Financial Metrics in Retail
- Gross margin represents sales after deducting the cost of goods sold, while operating expenses include all non-merchandise costs.
- Inventory turnover measures how often inventory is sold throughout the year, distinguishing between:
- High-performance retailers, which yield above-average results.
- Low-margin/low turnover and low-margin/high turnover retailers, which operate on different financial models.
Retail Size Classification
- Retailers' operating performance often correlates with their size, although advancements in technology have blurred these classification lines.
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Description
This quiz covers the foundational concepts of retailing, including the evolution of electronic commerce and its impact on businesses. Explore key outcomes expected from understanding the retail sector, particularly focusing on Business-to-Business (B2B) commerce. Test your knowledge on the new trends and practices shaping the retail landscape.
