41.

When RedBox rents
DVD movies from vending machines at McDonald’s, it is acting as a channel
captain, not a retailer.

True False

42.

Automatic vending
accounts for 15 percent of total U.S. retail sales.

True False

43.

Door-to-door selling
now accounts for less than 1 percent of retail sales in the United
States.

True False

44.

Internationally,
door-to-door selling is growing in popularity and, in the U.S., it accounts
for more than 15 percent of all retail sales.

True False

45.

Electronic shopping,
which puts catalogs on cable TV or Internet websites, has not yet succeeded.

True False

46.

Home shopping
methods–like cable TV shopping channels and catalogs–now use a multichannel
approach by adding a website.

True False

47.

It’s best to think
of retailing on the Internet as just another example of how low-margin
mass-merchandisers appeal to large target markets with discount prices.

True False

48.

Many types of
retailers are now establishing a presence on the Internet.

True False

49.

Today, about half of
all computer hardware and software and a quarter of all books are sold
online.

True False

50.

Retail sales on the
Internet grew very rapidly at first, but now are expected to grow
slowly.

True False

51.

Retailing on the
Internet already accounts for about 25 percent of all retail sales.

True False

52.

It’s usually
possible for a consumer to get much more information about a product in a
retail store than on the Web.

True False

53.

To overcome the
limitation of not being able to physically inspect a product before
purchasing online, many online retailers now provide photos and videos that
demonstrate the product.

True False

54.

The Internet makes
it easy to do comparison shopping of products and prices.

True False

55.

A consumer’s total
cost of shopping on the Internet includes delivery costs in addition to
purchase price.

True False

56.

A large chain like
Kohl’s uses its website to supplement the product assortment in its
brick-and-mortar stores.

True False

57.

Ace Hardware is a
multichannel retailer that integrates online and brick-and-mortar stores
(because its customers gather information online and then buy in a store or
vice versa).

True False

58.

The “wheel of
retailing” theory says that new retailers enter the market as
high-status, high-margin, high-price operators and then evolve into discount
stores as competition becomes more intense.

True False

59.

The development of
department stores and supermarkets is explained by the “Wheel of
Retailing” theory.

True False

60.

The “wheel of
retailing” theory fails to explain some major retailing developments,
such as vending machines and convenience food stores, which did not enter the
market with a low-price emphasis.

True False

61.

The development of
vending machines and convenience food stores is not explained by the
“Wheel of Retailing” theory.

True False

62.

Scrambled
merchandising is carrying any product lines a store thinks it can sell
profitably.

True False

63.

“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.

True False

64.

Retailers who carry
any product line that will sell profitably are practicing “scrambled
merchandising.”

True False

65.

Scrambled
merchandising means mixing product lines for higher profits.

True False

66.

The product life
cycle concept applies to retailers as well as products.

True False

67.

Application of the
product life cycle concept to retailing suggests that all types of retailers
are in early market growth due to continually increasing family income.

True False

68.

The majority of all
retailers in the U.S. have annual average sales of less than $1
million.

True False

69.

Less than 6 percent
of all retail sales are made by smaller stores–those with sales of less than
$1 million a year.

True False

70.

Less than 15 percent
of retail stores in the U.S. have annual average sales of $5 million or
more.

True False

71.

Almost 75 percent of
all retail sales are made by the largest stores–those with sales of over $5
million a year.

True False

72.

The average retail
store is too small to gain economies of scale.

True False

73.

Corporate chains are
taking a smaller percentage of retail sales now that consumers are demanding
lower prices.

True False

74.

The growth of
cooperative chains of retail stores is due to the desire of small retailers
to achieve some of the benefits of large-scale corporate chains.

True False

75.

“Cooperative
chains” like True Value Hardware are retailer-sponsored groups formed by
independent retailers to run their own buying organizations.

True False

76.

Cooperative chains
tend to work with independent retailers, not corporate chain retailers.

True False

77.

“Voluntary
chains” are retailer-sponsored groups–and “cooperative
chains” are wholesaler-sponsored groups–that work together to better
compete with corporate chains.

True False

78.

Voluntary chains
like SuperValu in groceries are wholesaler-sponsored groups that work with
“independent” retailers.

True False

79.

In a franchise operation,
the franchisor develops a good marketing strategy, and the retail franchise
holders carry out the strategy in their own units.

True False

80.

Franchise
operations, such as Subway, Quiznos, Curves, The UPS Store, Jackson Hewitt
Tax Service, Dunkin’ Donuts, Jani-King, RE/MAX Int’l, 7-Eleven, and Liberty
Tax Service account for about a third of all retail sales.

True False