RETAIL MANAGEMENT FINAL EXAM
QUESTIONS & ACTUAL CORRECT
ANSWERS LATEST VERSION
stock turn over - Correct Answer ✔✔ # of times during a period that average Inventory
on hand is sold
assortment plan - Correct Answer ✔✔ a list of merchandise that indicates in very
general terms what should be carried in a particular merchandise category
open-to-buy - Correct Answer ✔✔ the plan that keeps track of how much is spent in
each month and how much is left to spend
staple merchandise - Correct Answer ✔✔ regular products carried by retailer
model stock plan - Correct Answer ✔✔ # of each SKU in the assortment plan that the
buyer wants to have available for purchase in each store
fashion merchandise - Correct Answer ✔✔ category of merchandise that typically lasts
several seasons, and sales can vary dramatically from one season to the next
manufactured brands - Correct Answer ✔✔ a line of products designed, produced, and
marketed by a vender (also called national brand)
private brands - Correct Answer ✔✔ products developed and marketed by a retailer and
only available for sale by that retailer (also called store brand)
generic brands - Correct Answer ✔✔ unbranded, unadvertised merchandise found
mainly in drug, grocery, and discount stores
merchandise category - Correct Answer ✔✔ an assortment of items that customers see
as subtitles for one another
category management - Correct Answer ✔✔ The process of managing a retail;
business with the objective of maximizing the sales and profits of a category
advantages of rapid turnover - Correct Answer ✔✔ -fresh merch encourages
consumers to buy more, sales go up and increases sales volume
-less risk of obsolescent and markdowns, value of merch goes down the minute its
displayed
-decreased operating expenses
, disadvantages rapid turnover - Correct Answer ✔✔ -lowered sales volume
-increase cost of goods sold
-rapid turnover is preferred to slow turnover
the category product life cycle - Correct Answer ✔✔ The target market, variety,
distribution, price, and promotion of a product based on where a product is in its
lifecycle (picture on laptop)
variations of the category life cycle - Correct Answer ✔✔ Fad, Fashion, Staple, and
Seasonal merchandise
Data sources for developing sales forecast - Correct Answer ✔✔ Published Sources-
Buying Power Index (BPI), Monthly Retail Trade Report, InfoScan, Claritas, general
retail trade publications like Stores, WWD and Chain Store Age
stock-outs - Correct Answer ✔✔ a situation occurring when an SKU that a customer
wants is not available
reorder points - Correct Answer ✔✔ the stock level at which a new order is placed
safety stocks - Correct Answer ✔✔ extra stock that protects against out of stock
condition like unexpected sales, transportation delays, damaged goods (also known as
buffer stock)
order lead time - Correct Answer ✔✔ the amount of time between the recognition that
an order needs to be placed and the point at which the merchandise arrives in the store
and is ready for sale
EOQ (economic order quantity) - Correct Answer ✔✔ # of units that a company should
add to inventory with each order to minimize the total costs of inventory
advantages of private brands - Correct Answer ✔✔ -exclusivity of merch builds store
loyalty
-about 20% cheaper than manufactured brands
disadvantages of private brands - Correct Answer ✔✔ -advertisement is expensive as
there are no vendors to split advertisement cost with
advantages of manufactured(national) brands - Correct Answer ✔✔ -can help store
image
-help build traffic flow
-selling/promotional expenses are shared
disadvantages of manufactured brands - Correct Answer ✔✔ -restrictions may be
placed on the merchandise by the vendor on advertisements and display in the stores
QUESTIONS & ACTUAL CORRECT
ANSWERS LATEST VERSION
stock turn over - Correct Answer ✔✔ # of times during a period that average Inventory
on hand is sold
assortment plan - Correct Answer ✔✔ a list of merchandise that indicates in very
general terms what should be carried in a particular merchandise category
open-to-buy - Correct Answer ✔✔ the plan that keeps track of how much is spent in
each month and how much is left to spend
staple merchandise - Correct Answer ✔✔ regular products carried by retailer
model stock plan - Correct Answer ✔✔ # of each SKU in the assortment plan that the
buyer wants to have available for purchase in each store
fashion merchandise - Correct Answer ✔✔ category of merchandise that typically lasts
several seasons, and sales can vary dramatically from one season to the next
manufactured brands - Correct Answer ✔✔ a line of products designed, produced, and
marketed by a vender (also called national brand)
private brands - Correct Answer ✔✔ products developed and marketed by a retailer and
only available for sale by that retailer (also called store brand)
generic brands - Correct Answer ✔✔ unbranded, unadvertised merchandise found
mainly in drug, grocery, and discount stores
merchandise category - Correct Answer ✔✔ an assortment of items that customers see
as subtitles for one another
category management - Correct Answer ✔✔ The process of managing a retail;
business with the objective of maximizing the sales and profits of a category
advantages of rapid turnover - Correct Answer ✔✔ -fresh merch encourages
consumers to buy more, sales go up and increases sales volume
-less risk of obsolescent and markdowns, value of merch goes down the minute its
displayed
-decreased operating expenses
, disadvantages rapid turnover - Correct Answer ✔✔ -lowered sales volume
-increase cost of goods sold
-rapid turnover is preferred to slow turnover
the category product life cycle - Correct Answer ✔✔ The target market, variety,
distribution, price, and promotion of a product based on where a product is in its
lifecycle (picture on laptop)
variations of the category life cycle - Correct Answer ✔✔ Fad, Fashion, Staple, and
Seasonal merchandise
Data sources for developing sales forecast - Correct Answer ✔✔ Published Sources-
Buying Power Index (BPI), Monthly Retail Trade Report, InfoScan, Claritas, general
retail trade publications like Stores, WWD and Chain Store Age
stock-outs - Correct Answer ✔✔ a situation occurring when an SKU that a customer
wants is not available
reorder points - Correct Answer ✔✔ the stock level at which a new order is placed
safety stocks - Correct Answer ✔✔ extra stock that protects against out of stock
condition like unexpected sales, transportation delays, damaged goods (also known as
buffer stock)
order lead time - Correct Answer ✔✔ the amount of time between the recognition that
an order needs to be placed and the point at which the merchandise arrives in the store
and is ready for sale
EOQ (economic order quantity) - Correct Answer ✔✔ # of units that a company should
add to inventory with each order to minimize the total costs of inventory
advantages of private brands - Correct Answer ✔✔ -exclusivity of merch builds store
loyalty
-about 20% cheaper than manufactured brands
disadvantages of private brands - Correct Answer ✔✔ -advertisement is expensive as
there are no vendors to split advertisement cost with
advantages of manufactured(national) brands - Correct Answer ✔✔ -can help store
image
-help build traffic flow
-selling/promotional expenses are shared
disadvantages of manufactured brands - Correct Answer ✔✔ -restrictions may be
placed on the merchandise by the vendor on advertisements and display in the stores
