Rcsc214 Exam 1

Chapter 1 retailing-consists of the final activities and steps needed to pose merchandise made elsewhere into the hands of the consumer or to provide work to the consumer. Last step in supply chain. Trends that affect Retailing like a shot * E-tailing- ie. The Internet accounts for less than 5% of retail gross sales hardly has changed consumer behavior. (speed, thingummy, defy, colossal info, wiped turn up(p)est prices) hasnt destroyed *Bricks-and-Mortar retail merchants Retailers that opereat out of a corporal building. but B & M retail merchants must give guests more control to combat E-tailing.Outshopping-when nodes get needed info (such(prenominal) as proper coat or how to assemble a overlap) in the store and then orders it online for a unkepter price and to avoid paying sales tax. * Price emulation Loss Leader-selling a mathematical product at or below its address Bottom Line-net profit on an income statement *Same-Store sales-compares an individual stores sales to its sales for the selfsame(prenominal) month in the previous grade. *mart Share-the retail merchants nub sales divided by total market sales *Scrambled Merchandising- exists when a retailer handles umteen polar and unrelated accompaniments.The result of the pressure being placed on many retailers to increase profits by carrying additional merchandise or work (with toweringer profit marges) that exit also increase store occupation ex. Convenience store that sells low margin gasoline but high margin bread, milk, beer, ciggs ETC. Supercenters, gift cards in grocery stores but causes cost increases in RENT, INVENTORY COSTS, LABOR COSTs *Category Killer-a retailer that carries such a large amount of merchandise in a single category at such good prices that it makes it impossible for guests to walkway out without purchasing that they need, thus KILLING the competitionCategorizing Retailers Census Bureau- NAICS formula yield of outlets- Chain? Or not? *Stand ard Stock list-a merchandising manner in which all stores in a retail chain run the same merchandise *Optional Stock List approach-merchandising method in which each store in a retail chain is effrontery the flexibility to adjust its merchandise mix to local tastes and demands. *Channel advisor or Captain-the institution (manufacturer, wholesaler, broker, or retailer) in the marketing channel that is equal to externalize for and get other channel institutions to engage in activities they magnate not otherwise engage in.Large store retailers are often satisfactory to perform the role of channel captain. *Private Label Branding- May be store branding, when a retailer fall ins its own brand name and contracts with a manufacturer to produce the product with the retailers brand, or causality lines, where a known designer develops a line exclusively for the retailer. coast/Turnover Gross margin percentage- measure of profitability GROSS gross profit margin/NET sales Gross tole rance-NET SALES COST OF GOODS SOLDOperating Expenses-expenses that a retailer incurs in ladder the business other than the cost of merchandise Inventory Turnover- refers to the number of measure per year, on average, that a retailer sells its inventory. High Performance retailers-retailers that produce pecuniary results substantially superior to the industry average. Low margin/low turnover-operates on a low gross margin percentage and a low rate of inventory turnover will not be open to generate sufficient profits to remain competitive and survive. High Margin/Low turnover-(bricks and mortar) high gross margin percentage and low ate of inventory turnover ( high end stores, mom and pop) Clicks and Mortar-instore and online Low margin High turnover- low gmp, high rate of inventory turnover (wal mart, amazon. com) High, High- convenience stores, 7 eleven, circle k, Location- new non traditional places. Size *Store management- the sell career path that involves responsibility for selecting, training, and evaluating somebodynel, as well as instore promotions, displays, customer wait on, building maintenance, and security *Buying-retailing career path whereby one uses quantitative tools to develop appropriate grease ones palmsing plans for the stores merchandise lines.Analytical method view finder and investigator of facts Creative Method- Idea person Two pronged approach- twain analytical and creative CHAPTER 2 Strategic planning- involves adapting the resources of the true to the opport building blockies and threats of an ever changing retail environment * Development of mission statement * Definition of peculiar(a)ised goals and objectives for the firm * Identification and analysis of the retailers strengths, weaknesses, opportunities and threats SWOT ANALYIS * Development of basic strategies that will enable the firm to reach its objectives and fulfill its missionMission statement- a basic verbal description of the fundamental nature, rationale, a nd direction of the firm. Market Share- retailers TOTAL SALES/ TOTAL MARKET SALES amplification-based Objectives-deal directly with the monetary return a retailer desires from its business ROI/RONW- Return on investment/ Return on Net Worth STRATIEGIC PROFIT MODEL (MEMORIZE) Net ProfitMargin Net Profit / supply Sales Return on Assets Net Profit* /Total Assets Financial Leverage Total Assets/Net Worth Return on Net WorthNet Profit*/Net Worth X = Asset Turnover Total Sales/Total Assets Stockouts- products that are out of stock and therefore un accessible to customers when they want them Productivity objectives- state how a good deal output the retailer desires for each unit of resource input blast space, labor, and inventory investment. * Sales prod net sales/ total whole feet of retail floor space * Labor prod net sales/of full time equivalent employees * Merchandise prod net sales/average dollar investment in inventorySocietal Objectives- those that reflect the retailers desire to help society fulfill some of its needs. * use objectives * Payment of Taxes * Consumer Choice * Equity * Being a benefactor RASM- (revenue per available seat mile) calculation use by airlines. Yield Management- the understanding, anticipating and reacting to changing customer needs in order to maximize the revenue from a obstinate capacity of available operate. (1)low marginal costs (2)fixed capacity (3) perishable product (4)fluctuation demand (5) diverse market segmentsPersonal Objectives-reflect the retailers desire to help individuals utilise in retailing fulfill some of their needs. * Self Gratification * positioning and respect * Power and authority Strategy- a carefully designed plan for achieving the retailers goals and objectives. 3 strategies Get shoppers into your store/ traffic strategy Convert these shoppers into customers by having them purchase merchandise (retailers conversion Do this at the lowest run cost possible that is consistent with the level of servi ce that your customers expectTarget market-the group of customers that the retailer is seeking to serve Location-geographic or cyber space where the retailer conducts business Retail mix- the combination of merchandise, price, advertising and promotion, locations, customer service and selling, and store layout and design survey proposition- clear statement of the tangible and/or intangible results a customer receives from shopping at and using the retailers products or services Operations Management- deals with activities directed at maximizing the efficiency of the retailers use of resources. It is frequently referred to as day to day management.CHAPTER 6 flat Price Fixing- occurs when a group of competing retailers (or other channel members operating at a given level of distribution) establishes a fixed price at which to sell original brands of products ILLEGAL violates Sherman Antitrust Sec 1 erect Price Fixing-occurs when a retailer collaborates with the manufacturer or whol esaler to sell an item at an agreed upon price Price discrimination- occurs when 2 retailers buy an identical amount of like grade and quality merchandise from the same supplier but pay different prices. Clayton act makes only certain forms illegal DEFENSESCost justification- differential in price could be accounted for on the root of differences in cost to the seller in the manufactur, sale, or delivery. Due to differences in quantity or method. Changing market differences-justifies based on the insecurity of imminent deterioration of perishable goods or on the obsolescence of seasonal goods. clashing Competition in good faith -lower price was made in good faith in order to meet an equally low price of a competitor Deceptive Pricing-occurs when an misleading price is used to lure customers into the store and then hidden charges are added or the item advertised may be unavailable.Predatory Pricing-exists when a retail chain charges different prices in different geographic areas to eliminate competition in selected geographic areas. Palming off-occurs when a retailer represents that merchandise is made by a firm other than the true manufacturer Deceptive advertising-when a retailer makes counterfeit of misleading advertising claims intimately the physical makeup of a product, the benefits to be gained by its use, or the appropriate uses for the product. Bait and switch- advertising or promoting a product at an unrealistically low rice to serve as bait and then trying to switch the customer to a higher(prenominal) priced product. Product liability laws-deal with the sellers responsibility to market golosh products. These laws invoke the forseeability doctrine, which states that a seller of a product must go about to foresee how a product may be misused and rebuke the consumer against hazards of misuse. Expressed warranties- are either written or verbalized agreements about the feat of a product and can cover all attributes of the merchandise or only o ne attributeImplied guarantee of merchantability- made by every retailer when the retailer sells goods and implies that the merchandise sold is fit for the ordinary determination for which such goods are typically used Implied warranty of fitness- a warranty that implies that the merchandise is fit for a circumstancesicular purpose and arises when the customer relies on the retailer to assist or make the selection of goods to serve a particular purpose Territorial restrictions-are attempts by the supplier, usually a manufacturer, to mark the geographic area in which a retailer may resell its merchandiseDual distribution- occurs when a manufacturer sells to independent retailers and also through its own retail outlets One way exclusive dealing arrangement-occurs when the supplier agrees to give the retailer the exclusive right to sell the suppliers product in a particular trade area Two way exclusive dealing arrangement- occurs when the supplier offers the retailer the exclusive distribution of a merchandise line or product in a particular trade area if in return the retailer will agree to do something or the manufacturer, such as heavily promote the suppliers products or not handle competing brands. ILLEGAL. binder agreement-exists when a seller with a strong product or service requires a buyer to purchase a weak product or service as a condition for buying the strong product or service Ethics-set of rules for human moral behavior Explicit code of ethics-consists of a written policy that states what is ethical and unethical behavior unsaid code of ethics- an unwritten but well understood set of rules or standards of moral responsibility Chapter 14Empowerment- occurs when employees are given the power in their jobs to do the things necessary to satisfy and make things right for customers. Servant leadership-an employees recognition that their base responsibility is to be of service to others. 20% of customers generate 80% of sales value proposition-the p romised benefits a retailer offers in relation to the cost the consumer incurs customer relationship management CRM-comprised of an integrated information system where the fundamental unit of data collection is the customer, supplemented by relevant information about the customer erformance appraisal and review- is the formal, systematic assessment of how well employees are performing their jobs in relation to established standards and the communication of that assessment to employees Motivation-is the drive that a person has to excel at activities, such as a job, that he or she undertakes Esprit de corps- occurs when a group of workers feel a common mission and a passion for that mission and a pride in being part of the groupFixed component- typically is composed of some base wage per hour, week, month, or year Variable component-is often composed if some bonus that is received if performance warrants Fringe benefit megabucks-is a part of the total compensation package offered to many retail employees and may include health insurance, disability benefits, brio insurance, retirement plans, child care, use of an auto, and financial counseling Job enrichment- the edge of enhancing the core job characteristics to improve the motivation, productivity, and job satisfaction of employees.