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World of Fashion Merchandising Unit 4
Retail Business Fundamentals
100
Marketing
11th Grade
01/17/2011

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Term
Retail businesses try to _______ operating expenses and _______sales.
Definition
Minimize
Maximize
Term
What are the five functional areas of a retail company?
Definition
Merchandising,finance, store operations,personnel(human resources) and promotion.
Term
What is the function of merchandising?
Definition
planning,buying and selling merchandise.
Term
What is the function of the finance department?
Definition
Supervising teh budget and overseeing spending activities.
Term
What is the function of store operations?
Definition
Managing and maintaining the store, customer service,security.
Term
What is the function of human resources?
Definition
Hiring and training employees,benefits,performance evaluations (reviews).
Term
What is the function of promotion?
Definition
Advertising,display,public relations.
Term
What are "Mom and Pop stores?"
Definition
Small,often family owned,stores.
Term
What are general merchandisers?
Definition
Stores that sell all types of goods in multiple price ranges.Department and discount stores are general merchandisers.
Term
What are specialized merchandisers?
Definition
Stores that offer limited lines of related products to a defined customer.
Term
What is a flagship store?
Definition
The parent or main store that often houses the compoany offices.
Term
What is a branch store?
Definition
An individual unit of a company with many store locations.
Term
What is a chain store?
Definition
A company with 12 or more stores.
Term
What is the home office or central office?
Definition
The location of a retail companies executives-CEO, buyers,finance,human resources etc.
Term
What is an anchor store?
Definition
The large stores in a mall that serve to pull customers into the mall. (Macys,Penneys,Sears etc.)
Term
What is a discount store?
Definition
Stores with minimal services and low prices.Target,KMart,Walmart.
Term
What is an off price retailer?
Definition
Stores that sell brand names at lower prices buy purchasing products that the vendors need to clear out.TJ Maxx,Marshalls
Term
What is a factory outlet?
Definition
Stores owned by a brand,designer or manufacturer to sell off product they need to clear.
Term
What is a wholesale club?
Definition
Stores that charge a membership fee and sell basic products in bulk packaging.Costco,Sam's Club
Term
What are specialty stores?
Definition
Stores offering a specific type of product. Victoria's Secret, Forever 21.
Term
What are category killers?
Definition
Large discount specialty stores that destroy competition in their specialty area.Home Depot,Best Buy.
Term
What are boutique stores?
Definition
Small,unique stores that sell distinctive merchandise.
Term
What is non-store retailing?
Definition
All retail outlets that do not involve a physical store location- cataloge,online,tv.
Term
How do mail order retailers sell products to teh consumer?
Definition
Cataloges.
Term
What is direct mail retailing?
Definition
Cataloges.
Term
Name one television retailer.
Definition
QVC.
Term
What are two advantages to the consumer of on line retailing?
Definition
Products can be purchased any time of the day.The customer does not have to leave home.
Term
What types of retail format is located in teh hallways of malls?
Definition
Kiosks.
Term
What is a leased department?
Definition
A department within a store that is actually run by another company leasing (renting) teh space.Commonly done in shoes and fine jewelry.
Term
What is the name of the largest retail trade association?
Definition
National Retail Foundation (NRF)
Term
What is retail positioning?
Definition
A companies postition amoung other retailers in regards to products and prices.
Term
What are the four elements of the marketing mix (the 4 P's)?
Definition
Product,price place and promotion.
Term
What is the strategy of retail positioning? (3 steps)
Definition
Define target market and understand buying motives. Create a specific image to differentiate from competitors. Blend correct marketing mix (4 P's)
Term
What is purchasing behavior?
Definition
The way customers act in the market.
Term
What are buying motives?
Definition
The reasons people buy what they buy.
Term
What are rational buying motives?
Definition
Practical concerns such as quality,price,how badly an item is needed.
Term
What are emotional buying motives?
Definition
Buying based on feelings about the product-fashion,color,appeal.
Term
What are product buying motives?
Definition
Buying based on the image of the product.
Term
What are patronage buying motives?
Definition
Favoring purchasing from a particular store.
Term
What are the four types of retail competition?
Definition
Direct, indirect,vertical and lifestyle.
Term
What is direct competition?
Definition
Two retailers with the same format.Forever 21 and H&M
Term
What is indirect competition?
Definition
Competition between retailers with different formats selling teh same product.Target and Best Buy are indirect competitors in selling electronics.
Term
What is vertical competition?
Definition
Businesses at different levels of teh supply chain.Specifically factory outlet stores that compete with the retail stores that the factory sells products to.
Term
What is lifestyle competition?
Definition
Competition for the consumers time and money by other activities. Movies,DVD's,sports etc.
Term
What is meant by a store's image?
Definition
The way it is seen by the public in terms of it's identity.
Term
How is a store's image formed?
Definition
By it's merchandise, physical appearance,promotions,employees.
Term
What is product mix?
Definition
A store's selection of goods and services.
Term
What is the merchandise assortment?
Definition
The range of products a store carries.
Term
What is assortment breadth?
Definition
The number of styles a store carries. A broad assortment has alot of styles.A narrow assortment has few styles.
Term
Whatis assortment depth?
Definition
The quantity of an item available. A deep assortment has alot of the same item-many sizes and colors.A shallow assortment has a small amount of each style.
Term
What store is more likely to carry a narrow and deep assortment-Ralph Lauren or Target?
Definition
Target.
Term
What are some services stores might provide to customers?
Definition
Parking,gift wrapping,alterations,credit,personal shopper.
Term
What type of store would offer more services,a discount store or a department store?
Definition
A departments tore.
Term
What are price points?
Definition
Specific prices that a store utilizes,for instance pants at 20,30,and 40.Or pants at 9.99,14.99 and 19.99. or pants at 60,80 and 100.
Term
What is prestige pricing?
Definition
Setting high prices to attract customers who want staus or high quality.
Term
What is price promoting?
Definition
Advertising sale prices
Term
What is value pricing?
Definition
Selling prices below the manufacturers suggested price.
Term
What is a price war?
Definition
Stores lowering prices to compete with eachother.Sometimes they will loose money on teh product in order to hurt the competition.
Term
What is every day low pricing?
Definition
Products are priced at a low price every day instead of being on sale some times and other times at regular price.
Term
What is tenant mix?
Definition
The assortment of stores in a particular location.
Term
What is intensive market coverage?
Definition
Having many stores in a particular area.
Term
What is selective market coverage?
Definition
Locating stores in only a few places within an area.
Term
What is exclusive market coverage?
Definition
Having stores in very few,choice spots.
Term
What physical part of the store cretaes the first impression?
Definition
The exterior.
Term
What are the two parts of the store interior?
Definition
Selling areas and sales support areas.
Term
What are hardlines?
Definition
Products that are not made from textiles-furniture,electronics
Term
What are softgoods?
Definition
Clothing and other items made from textiles.
Term
What is the goal of a buyer?
Definition
To make a profit for teh company.
Term
What internal information does a buyer use to decide future purchases?
Definition
Past sales
Term
What external information does a buyer use to determine purchases?
Definition
Vendor and trade information.
Term
What is the formula for stock turnover based on six months of sales?
Definition
add the 7 months of inventory and divide by 7.This is average stock,Add up the six month sales. Formula is SALES/AVERAGE STOCK.
Term
What are the months in the spring season six month buying plan?
Definition
Feb,March,April,May,June and July
Term
What is open to buy?
Definition
The amount of money the buyer can spend.
Term
If you have a sales decrease,will your open to buy increase or decrease?
Definition
decrease.
Term
What is a basic stock plan?
Definition
A plan for predictable items that should always be in stock
Term
What are close out goods?
Definition
Goods the manufacturer needs to get rid of and therefore reduces the price.
Term
What is the difference between a manufacturer and a wholesaler?
Definition
A manufacturer makes products. A wholesaler buys products from a manufacturer and then sells them to a buyer. A manufacturer may also sell goods directly to buyers.
Term
What attributes should be considered before choosing a vendor?
Definition
Their products,prices,credit terms,shipping capabilities, what other stores they sell
Term
What is floor ready merchandise?
Definition
Products are ticketed and on hangers if needed,ready to go to the sales floor.
Term
What is vendor turnaround time?
Definition
How long it takes a vendor to ship after a product is ordered.
Term
What are key resources?
Definition
Preferred vendors that the store has had sucess with.
Term
What are the advatages of brand name vendors?
Definition
Brand recognition,vendor paid advertising.
Term
What are the disadvantages of brand name merchandise?
Definition
Identifable product restricts pricing options,requirements to stock certain amounts.
Term
What are teh advatages of private label merchandise?
Definition
Exclusive styles,lower prices.
Term
What is off shore sourcing?
Definition
Goods bought from over seas suppliers.
Term
What are some disadvantages of buying off shore?
Definition
Must be ordered far in advance. shipping problems and customs delays.
Term
What are market centers?What are the two most important US market centers?
Definition
Geographic areas where vendors show and sell products. New York and Los Angeles
Term
What is market week?
Definition
Specific weeks during teh year where vendors show new lines.
Term
What do buyers gain from attending market weeks?
Definition
See trends and entire lines of products during a short time.Looking for new vendors.Meeting with vendors management and working out favorable terms,networking with other buyers.
Term
What are trade shows?
Definition
Periodic temporary shows,often featuring new or smaller vendors.
Term
What are apparel marts?
Definition
Buildings around the country where vendors ahve showrooms.LA,Dallas,Atlanta,Miami
Term
What is an import agent?
Definition
They shop overseas for products the buyer wants.They are familiar with the foreign vendors and teh language
Term
What is a resident buying office?
Definition
A service that employs buyers to scout teh market and report to member store buyers.
Term
What is a PO? What is leaving paper?
Definition
Purchase order- the written document that is used to buy goods.Leaving paper means to give the vendor an order during your visit or during market week.
Term
What is teh completion date of an order?
Definition
The date the products must be delivered by.
Term
What is a reorder?What is a backorder?
Definition
A reorder is an additional order for goods that are selling well. A backorder means the vendor cannot ship teh product now,but may be able to ship later.
Term
What is dating?
Definition
An increased amount of time to pay.
Term
What does Net/30 mean?
Definition
Net-there is no additional discount.
30- you have 30 days to pay
Term
What does 8/10 EOM mean?
Definition
You have a discount of 8% if you pay within 10 days of the End Of the Month you recieved the goods.
Term
What are terms?
Definition
The terms of teh sale-discounts,time to pay,delivery date,shipping method, transfer of title
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