BMGT353 Exam #1 Review

BMGT353 Exam #1 Review - BMGT353: Retail Management Exam #1...

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BMGT353: Retail Management Exam #1 Review 1. Retailing a. The set of business activities involved in selling products directly to consumers for their personal or family use b. Products can be goods, services, or a combination 2. Channel of Distribution a. Set of firms/individuals who facilitate the movement of products from the point of production to the point of sale to the end consumer 3. Added Value by Retailers a. Provide assortment i. Allows consumers to buy a variety of products at the same time b. Breaking bulk i. Allows consumers to buy products at the quantities that they want c. Provide services i. Makes it easier to buy and use products 4. Retail Mix Decisions a. Store locations b. Store layout and design c. Services d. Pricing e. Promotion f. Merchandise assortment Types of Retailers 1. a. Specialty Stores i. b. Category Killers i. Best Buy, Staples, Home Depot c. Department Stores i. Nordstrom, Macy’s, Sears d. Supermarkets i. Safeway, Giant e. Drug Stores i. Walgreens, CVS, Rite Aid f. Convenience Stores i. 7-Eleven 1
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g. Mass Merchandisers i. Wal-Mart, Target h. Supercenters/Hypermarkets i. Wal-Mart Supercenter 2. Current Trends of Retailers a. Specialty Stores i. Performing well b. Category Killers i. Performing well c. Department Stores i. Lower tier stores struggling ii. Not as limber with assortment as specialty stores are iii. Must charge higher prices due to high rent iv. Service levels being cut back to reduce costs d. Supermarkets i. Facing strong competition with supercenters ii. Beginning to differentiate 1. High end: Whole Foods 2. Low end: Aldi e. Drug Stores i. Core business being threatened by supermarkets and Supercenters ii. Pharmacy’s make up 50% of revenue, and 70% of gross margin f. Convenience Stores i. Unique value proposition being lost by increased competition g. Mass Merchandisers i. Performing well h. Supercenters/Hypermarkets i. Performing well 3. Low Price Retailer a. Discounters i. Wal-Mart, Target b. Off-price Stores i. Independents 1. TJ Maxx ii. Factory Outlets iii. Warehouse Club iv. Dollar Stores 4. Non-store Retailing a. Direct Selling b. At home shopping via indirect contact i. TV, telephone, mail, internet c. Vending Machines 2
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i. Convenience ii. High-priced 5. Types of Retail Ownership a. Independent Single-Store Owners b. Retail Chains c. Franchising Retail Performance Measures 1. Return on Assets a. Combines two critical aspects of retail businesses: margin management and asset management b. Computed on an annual basis. c. Helps compare the profitability of two companies d. For each $1 that a company has in assets, the company makes X% in profit. e.
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BMGT353 Exam #1 Review - BMGT353: Retail Management Exam #1...

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