Retail Study Guide – Exam 2
Levy and Weitz, Chapters 7-14
The exam covers chapters 7-14 in the text in addition to class discussions and our guest speakers.
Below are some areas on which to focus as you prepare.
What is a Trading Area?
Trading Area Analysis – How do retailers determine a trade area?
Site Selection – What factors should be considered?
Geographical Information Systems (GIS)
Types of Locations
Central business district (CBD)
Destination stores, anchor stores, kiosks, power center
Size and shape of trading areas
Primary, secondary, and fringe trading areas
Buying Power Index, Spending Potential Index
Index of Retail Saturation
Huff Gravity Model
Reilly’s Law of Retail Gravitation – point of indifference
Human Resource Management
Recruitment and Selection
Employee turnover
Training and Motivating Employees
Testing Methods
Compensation
Management styles, empowerment, mentoring
Procedural justice, distributive justice
Mystery Shoppers
Merchandise Planning and Management – Forecasting, planning investments in inventory,
reductions
Inventory turnover – managing and calculating
Discounts and dating
Stock-to-Sales ratio, Sales-to-Stock ratio
Open-to-Buy, Planned Purchases, Purchase Commitments
GMROI: Gross margin percentage X Sales-to-stock ratio
Stock-keeping unit
Category management
Model Stock Plan
Staple merchandise management – safety stock, backup stock, lead time, order point
Sell-through analysis, markdown money
National and private label brands
Wholesale market, trade shows
Co-op advertising
Negotiating with Vendors
MSRP, Resale price maintenance
Robinson-Patman Act – forbids vendors from offering different terms and conditions to different
retailers for the same merchandise and quantity
Slotting allowances, slotting fees
Exclusive dealing agreements – vendor restricts a retailer to carry only its products and nothing
from competing vendors; illegal if considered anticompetitive
Tying contract – vendor requires a retailer to take a product it doesn’t necessarily want to get a
product it does want; illegal if they lessen competition or create a monopoly
Reverse auctions
Support services for the buying process – Resident Buying Offices, Retail Exchanges
Information Systems and Supply Chain Management (Chapter 10)
Benefits to vendors and retailers of collaborating on supply chain management
Information technology (IT) developments that are facilitating vendor-retailer communications
RFID – What is it and what are its benefits? What is slowing its adoption?
Universal Product Code (UPC)
Data warehouse
Electronic Data Interchange (EDI) – How does it work? What are the benefits?
Customer Relationship Management
Customer Loyalty, Customer Retention, Frequent Shopper Programs
Cross-selling
Lifetime Value of a Customer
RFM Analysis (recency, frequency, monetary), data mining, market basket analysis
Customer pyramid and the 80-20 rule
Share of wallet