Questions you should be able to answer What is positioning The design and implementation of a retail mix to create an image in the customer s mind of a retailer relative to its competitors brand building What information is used to analyze a firms profit path Income statement What is cumulative attraction the principle that states that a cluster of similar and complementary retailing activities will generally have a greater drawing power than isolated stores that engage in the same retailing activities What is cross docking occurs when products are prepackaged for a specific store given a UPC label and then placed on a conveyor system that routes them from the unloading dock at which they were received to the loading dock for the truck going to their specific store Why would a retailer look at inventory turnover It is used to evaluate how effectively retailers utilize their investment in inventory Describe an example of customer loyalty a store that customer are reluctant to not shop at Which ratio would a retailer look at to compare their performance to another retailer Strategic profit model Which ratio is included as a key part of the strategic profit model net profit total assets What is centralization the degree to which authority for making retail decisions is delegated to corporate managers rather than to geographically dispersed regional district and store management Define CPFR Collaborative Planning Forecasting and Replenishment is the sharing of forecast and related usiness information and collaborative planning between retailers and vendors to improve supply chain efficiency and product replenishment What is the difference between a push and pull supply chain Push supply chain merchandise is allocated to stores on the basis of forecasted demand Pull Supply chain orders for merchandise are generated at the store level on the basis of POS sales data Define a primary trade area the geographic area from which the shopping center or store site derives 50 70 of its customers Define asset turnover assesses the productivity of a firm s investment in its assets net sales total assets What are the factors that enter into the calculation of net sales Gross Sales Promotional Allowances Return What retailers are typically in a power center big box retail stores Target off price Marshalls warehouse Costco specialists Lowes Best Buy Exam 2 Company names Bloomingdale s Bubba s Bar and Grille Home Depot Lowe s Rainforest Caf Rhode s Furniture Russell Athletic Silver Exchange Coin Shop Target Victoria Secret Western Track Exam 2 Terms Retail strategy a statement identifying 1 the retailers target market 2 the format the retailer plans to use to satisfy the target market s needs and 3 the bases on which the retailer plans to build a sustainable competitive advantage Vendor relations developed over a long time and may not be easily offset by a competitor Competitive advantage advantage the retailer has over its competition that is not easily copied by competitors and thus can be maintained over a long period of time Customer loyalty customers are committed to buying merchandise and services from a particular retailer Positioning the design and implementation of a retail mix to create an image of the retailer in the customer s mind relative to its competitors Market penetration growth opportunity directed toward existing customers using the retailer s present retailing format Vertical integration diversification by retailers into wholesaling or manufacturing Cross selling sales associates in one department attempt to sell complementary merchandise from other departments to their customers Diversification retailer introduces a new retail format directed toward a market segment that s not currently served by the retailer Strategic profit model method for summarizing the factors that affect a firm s financial performance as measure by return on assets Net sales total revenues received by a retailer that are related to selling merchandise during a given period Gross margin net sales minus the cost of the goods sold Income statement where the information used to examine the profit margin management path comes from Retail operating expenses include selling general and administrative expenses plus the depreciation of the retailer s assets Balance sheet where the information used to analyze a retailer s asset management path comes from Inventory turnover Cost Of Goods Sold during a time period divided by the average level of inventory at cost during that time period Asset turnover net sales divided by total assets Freestanding locations retail sites for an individual isolated store unconnected to other retailers might be near other freestanding retailers or a shopping center Gentrification the renewal and rebuilding of offices housing and retailers in deteriorating areas CBD the central business district is the traditional downtown business area in a city or town Power centers shopping centers that consist primarily of collections of big box retail stores such as full line discount stores Target off price stores Marshalls warehouse clubs Costco and category specialists Best Buy Lowes Lifestyle centers shopping centers that have an open air configuration of specialty stores entertainment and restaurants with design ambience and amenities such as fountains and street furniture Airport retailing stores in an airport have higher rent higher costs and inconvenient location for workers higher wages Destination store places where consumers will go even if it is inconvenient just like enclosed malls are destination locations for fashion apparel comparison shopping Pop up shop stores in temporary locations that focus on new products or a limited group of products Shopping malls enclosed climate controlled lighted shopping cemters with retail stores on one or both sides of an enclosed hallway Cumulative attraction principle that states a cluster of similar and complementary retailing activities will generally have greater drawing power than isolated stores that engage in the same retailing activities Parasite store a store that does not create it s own traffic and whose area is determined by the dominant retailer in the shopping center or retail area Traffic flow the number of vehicles and pedestrians that pass by the site Traffic count used to assess a site s attractiveness important for businesses that offer products bought on impulse or on frequent trips GIS the geographic information system is a