Retailing
Retailing institution that purchases brand name merchandise on an opportunistic basis, sells it well below the manufacturers suggested retail price, and seeks to attract department store shoppers
What are off-price chains?
A conceptual model that indicates what retailers need to do to provide high quality customer service
What is the Gap Model of Service Quality?
When a retailer grows their business by using a new format to attract new segments
What is diversification?
New types of retailers enter a market as low price, low status merchants
What is the Wheel of Retailing?
A model used to plan a retailer’s financial strategy based on margin management, asset management, and financial leverage
What is the Strategic Profit Model?
A function performed by retailers and wholesalers in which they receive large quantities of merchandise and sell them in smaller quantities
What is breaking bulk?
The difference between the actual service provided to customers and the service promised in the retailer’s promotion program
What is the communications gap?
Retail strategy that focuses on increasing sales to present customers using the present retailing format
What is market penetration?
When retailers mutually adapt in the face of competition from others; an example is a discount department store
What is the dialectic process?
Net profit margin X Asset turnover; Net profits after taxes divided by total assets
What is Return on Assets?
The set of business activities that adds value to the products and services sold to consumers for their personal use
What is retailing?
The difference between the retailer’s service standards and the actual service provided to customers
What is the delivery gap?
A distinct competency of a retailer relative to its competitors that can be maintained over a considerable period of time
What is a sustainable competitive advantage?
Seeking a long-term relationship with customers rather than viewing each sale as a new encounter
What is relationship retailing?
Return on Assets X Leverage Ratio
What is return on net worth (RONW)?
Competition between retailers that sell similar merchandise using different format, such as discount and department stores
What is intertype competition?
The difference between customers expectations and the retailer’s perception of customer expectations
What is the knowledge gap?
When sales associates in one department attempt to sell complementary merchandise in another department to their customers
What is cross-selling?
Type of distribution in which a retailer is required by a manufacturer to carry only its products and no competing vendor’s products
What is exclusive distribution?
Net sales divided by average inventory
What is inventory turnover?
The number of SKUs within a merchandise category – the depth of merchandise
What is assortment?
Professional shopper who shops a store to assess the service provided by store employees
What is a mystery shopper?
Diversification by retailers involving investments in wholesaling or manufacturing merchandise; An example is Zale’s designing jewelry as well as selling it
What is vertical integration?
The combination of factors used by a retailer to satisfy customer needs and influence their purchase decision; includes merchandise offered, service, pricing, advertising, store design and location
What is the Retail Mix?
How much profit each dollar of sales generates
What is Net Profit Margin?