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CHAPTER 4—EVALUATING THE COMPETITION IN RETAILING
MULTIPLE CHOICE
1. To be successful in retailing today, given the slower population growth rate, retailers will grow by:
a. taking away sales from competitors.
b. reducing the number of stores they have.
c. having their industry legislated as a monopoly.
d. accusing their competitors of unfair competition.
e. reducing customer services.
ANS: A PTS: 1 REF: p. 114 OBJ: LO 4-1
2. High-profit performance retailers must always be on the offensive in their study of the changing
competitive environment, especially its _____ competition.
a. local
b. statewide
c. nationwide
d. worldwide
e. industry
3. A retailer who has already done a great job of developing a strategy:

a. should also be aware of changes on the national retailing scene, but need not concern itself
with local changes.
b. need not worry what competitors are doing.
c. should never be seen visiting a competitor's store.
d. must make sure that its fixed costs exceed its variable costs.
e. must always remember that no retailer can ever design a strategy that will totally insulate
it from the actions of competitors.
ANS: E PTS: 1 REF: p. 115 OBJ: LO 4-1
4. A market offers rows of exotic produce, fresh prime meats, seafood flown in fresh, a bakery filled with
artisan breads and over 220 cheeses. This market is competing for customers on which major front?
a. The price for the value offered
b. Service level
c. Product selection
d. Location or access
e. Employee compensation
ANS: C PTS: 1 REF: p. 116 OBJ: LO 4-1
5. Retailers compete for customers on five major fronts or factors. Which of the following is NOT one of
the major fronts retailers compete for target customers?
a. The price for the value offered
b. Service level
c. Product selection
d. Customer experience
e. Employee compensation
© 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in
whole or in part.
6. What type of competitive environment is characterized by a horizontal demand curve, where the
retailer must sell all of its merchandise at the going "market" or equilibrium price?
a. Perfect competition
b. Oligopolistic competition
c. Pure competition
d. Pure monopoly
e. Monopolistic competition
7. _____ is marked by many retailers, all selling very similar products with ease of entry for both buyers
and sellers.
a. Pure competition
b. Oligopolistic competition
c. Fair competition
d. Level competition
e. Pure profit competition
8. _____ describes a situation where consumers already have one unit of an item and as a result place a
lower value on an additional unit.
a. Decreasing marginal revenue
b. Leveling product usage
c. Monopolistic decline
d. Declining marginal utility
e. The law of diminishing markets
ANS: D PTS: 1 REF: p. 117 OBJ: LO 4-1
9. Which of the following factors is NOT characteristic of a market experiencing pure competition?
a. Ease of entry into the market
b. Many buyers
c. Many sellers
d. Similar products
e. Differentiated products
10. When Gap Stores get an exclusive contract to sell uniforms to your old high school, it is an example
of:
a. monopolistic competition.
b. oligopolistic competition.
c. pure monopoly.
d. pure competition.
e. perfect competition.
11. _____ occurs when there is only one seller for a product or service.
a. Pure competition
b. Pure monopoly
c. Monopolistic competition
d. Oligopolistic competition
e. Perfect competition
whole or in part.
ANS: B PTS: 1 REF: p. 117 OBJ: LO 4-1
12. Retailing is often characterized as:

b. vertical competition.
c. pure monopoly.
13. If the top four firms of an industry account for more than 60 percent to 80 percent of the market, which
of the following occurs?
a. Monopolistic competition
b. Oligopoly
c. Pure monopoly
d. Pure competition
14. _____ occurs when the products offered are different, yet viewed as substitutable for each other, and
the sellers recognize that they compete with sellers of these different products.
a. Pure competition
b. Pure monopoly
15. The competition between American Airlines and Delta Airlines is an example of:
b. oligopolistic competition.
c. pure monopoly.
16. _____ occurs when relatively few sellers, or many small firms who follow the lead of a few larger
firms, offer essentially homogeneous products and any action by one seller is expected to be noticed
and reacted to by the other sellers.
a. Pure competition
b. Pure monopoly
17. Which of the following is a key characteristic of monopolistic competition?

a. Few sellers
b. Substitutable products
whole or in part.
c. Horizontal demand curve
d. One seller
e. Lack of government regulation
18. Customers can “self-inflict” this type of competition when a brand name is perceived as unique and
highly valued, and a retailer controls its sale.
a. Pure competition
b. Pure monopoly
19. _____ occurs when a household leaves their community of residence to shop in another community; it
usually occurs when people leave a smaller community to shop in a larger community.
a. Outshopping
b. Piggybacking
c. Social shopping
d. Nonstore shopping
e. Bricks-and-mortar retailing
20. Which of the following is NOT an example of a nonprice demand strategy that a retailer could employ
as a means of increasing its demand?
a. Increasing the width of the store's aisles, so the customer can freely move around in the
store.
b. Providing "out-of-town" customers with free gasoline.
c. Offering a 30-day guarantee to customers if they find the same product for a cheaper price.
d. Providing customers using public transportation with complimentary "ride and shop"
coupons.
e. Developing an advertising campaign aimed at persuading consumers to make more of
their purchases at its stores.
ANS: C PTS: 1 REF: p. 120-122 OBJ: LO 4-1
21. Because many retailers have access to the same merchandise, high-profit performing retailers have
sought to use _____ in order to develop a protected niche in the marketplace so that they cannot be
easily copied by the competition.
a. revenue management
b. yield management
c. asset management
d. store positioning
e. category killers
22. Retail experts would agree that a certain marketplace is _____ if the number of stores in relation to the
number of households is so large that to engage in retailing is unprofitable or marginally profitable.
a. over-spaced
b. saturated
c. overstored
whole or in part.
d. overmarketed
e. too price-competitive
23. Retailers would like to compete in _____ since many retailers in such markets achieve an above-
average return on investment due to the low level of competition in the marketplace.
a. intratype markets
b. overstored markets
c. understored markets
d. pure monopolies
e. divertive markets
24. What type of competition is it when Avon competes with Mary Kay?
a. Intertype competition
b. Pure monopoly
c. Vertical competition
d. Intratype competition
e. Foreign analysis
25. Intratype competition is competition between _____ for the same customer.
a. different types of retail operations (as classified by the NAICS)
b. two retailers of the same type (as defined by NAICS)
c. bricks-and-mortar retailers and Internet retailers
d. discount and full-price retail outlets
e. retailers and wholesalers (regardless of the NAICS)
26. When two discount department stores such as Sears and JCPenney compete for the same customer,
what type of competition is occurring?
a. Intertype
b. Conceptual
c. Divertive
d. Intercept
e. Intratype
27. Albertson's Supermarkets recently began offering DVD rentals to compete with Blockbuster. What
type of competition is this?
a. Intertype
b. Intratype
c. Scrambled
d. Mixed share
e. Mixed location
28. When gasoline stations, convenience stores, and supermarkets all sell milk, bread and oil, this is an
example of what type of competition?
whole or in part.
a. Perfect competition
b. Vertical competition
c. Intratype competition
d. Monopolistic competition
e. Intertype competition
29. Dawn needed to drop off a few garments at the dry cleaners. On her way to work, she stopped at the
local SuperCenter to pick up pastries for her staff at work. While at the SuperCenter, Dawn noticed
that they now offer dry cleaning services. So, instead of going to the dry cleaner’s on the corner, Dawn
dropped off her garments at the SuperCenter. By offering dry cleaning, SuperCenter successfully
engaged in what form of competition?
a. Perfect monopoly
b. Mixed-share
c. Divertive
d. Intratype
e. Interactive
30. Divertive competition occurs when:

a. retailer A sends its customer to retailer B to purchase any products that A had "out-of-
stock."
b. the customer buys product A rather than product B, which was the one he/she was
shopping for.
c. a retailer intercepts and makes a sale to a customer that normally would have purchased
the product at another retail store.
d. the retailer tries to entice the customer to buy a more expensive model or brand than
wanted.
e. the customer buys a private label instead of his/her usual brand.
31. _____ competition occurs when retailers intercept customers from competing retailers.
a. Intertype
b. Intratype
c. Monopolistic
d. Divertive
e. Cross-shopping
32. The _____ is the point where total revenues equal total expanses.
a. break-even point
b. matched point
c. stabilization point
d. profit maximization point
e. point of highest revenue
33. The wheel of retailing theory:

a. only relates to the evolution of automobile dealers.
b. describes the evolution of a retailer's price and service strategies over time.
whole or in part.
c. is another name for the retail life cycle.
d. describes how retailers tailor their product offering to various economic segments.
e. explains why all retail formats must be updated at least once a decade.
34. The theory of retail competition that states that new retail institutions enter the marketplace as low-
price, low-margin operations and eventually begin to offer more services and charge higher prices is
the:
a. retail accordion theory.
b. high/low theory.
c. natural selection theory.
d. retail life cycle theory.
e. wheel of retailing theory.
35. In 2000, Samantha Toller started a small fast-food restaurant. In order to gain a competitive foothold,
Samantha offered low prices with very few extras. As her business grew, Samantha started adding
services and gradually had to increase prices to cover the costs of these services. Today, Samantha is
vulnerable to new, low-price competitors. This is an example of what theory of retail evolution?
a. High price jinx
b. High/low
c. Retail life cycle
d. Wheel of retailing
e. Retail accordion
36. The _____ contends that a "new" retailer enters the market as a low-status, low-margin, low-price
operator, then changes to a higher-status, higher-margin, higher-price retailer which then has market
share taken away by a new low-status, low-margin, low-price retailer.
a. retail accordion theory
b. wheel of retailing theory
c. natural selection theory
d. the dialectic process
e. retail life-cycle theory
37. The wheel of retailing theory suggests that retailers move from the _____ phase to the _____ phase
and finally to the _____ phase.
a. exit; decline; experienced
b. entry; trading-up; vulnerability
c. entry; expansion; decline
d. general stores; specialty stores; general stores
e. supply; demand; profit
38. According to the wheel of retailing theory, _____ currently appear to be in the vulnerability phase of
their evolution.
a. outlet malls
b. warehouse clubs
c. health spas
whole or in part.
d. The Internet
e. discount department stores
39. The _____ theory of retail evolution describes retail institutions as evolving from outlets that offer
wide assortments to specialized stores that offer narrow assortments, and then return to the wide
assortment stores, continuing this pattern again and again.
a. wheel of retailing
b. retail life cycle
c. retail accordion
d. dialectic
e. natural selection
40. Retail historians have observed that, in the United States, retail trade was dominated by _____ until
1860; this type of store carried a broad assortment of merchandise ranging from farm implements to
textiles to food.
a. mail order
b. general stores
c. door-to-door sales
d. discount stores
e. department stores
41. Some have argued that Walmart's current move to Neighborhood Market grocery stores, which are
significantly smaller than their superstores, is an indication that the retailer is moving from general to
specific to general. If this is true, this would be an example of the _____ theory of retail evolution.
b. retail life cycle
c. retail accordion
d. market equilibrium
e. cyclical
42. The last stage of the retail life cycle is:

a. re-invention.
b. realignment.
c. decline.
d. maturity.
e. disengagement.
43. The retail life cycle suggests that firms move from the _____ stage to the _____ stage to the _____ to
_____ stage.
a. introduction; growth; maturity; decline
b. introduction; development; maturity; decline
c. entry; development; maturity; decline
d. entry; trading-up; vulnerability; decline
e. innovation; growth; development; decline
whole or in part.
44. Which stage of the retail life cycle is characterized by the entrance of many new competitors and
tremendous growth in sales and profits?
a. Vulnerability
b. Maturity
c. Growth
d. Entry
e. Introduction
45. As a warehouse club manager, you have noticed that this format's market share has stabilized. As such,
you fear severe profit declines as warehouse clubs are now in the _____ stage of the retail life cycle.
a. introduction
b. growth
c. maturity
d. decline
e. vulnerability
46. The _____ theory suggests that all firms seek superior financial performance in an ever-changing
environment, and as a result, firms are forced to change the elements of their retail mix to match
changing consumer preferences.
b. retail accordion
c. retail life cycle
d. resource-advantage
e. monopolistic competitive
ANS: D PTS: 1 REF: p. 131-132 OBJ: LO 4-3
47. Which of the following is NOT a trend shaping the retail landscape today?
a. Decrease in competition from nonstore retailers
b. The advent of new retailing formats
c. Heightened global competition
d. The integration of technology into current operations
e. The increasing use of private labels
48. According to most retail analysts, as a result of several key forces at work today, which of the
following forms of nonstore retailing will experience significant growth over the next decade while the
other forms will remain steady or decline?
a. Telemarketing
b. Vending machines
c. Catalog sales
d. Direct selling
e. Internet shopping
49. Which of the following factors will NOT contribute to the growth of nonstore retailing?
a. Consumers' desire to save time
whole or in part.
b. The tremendous development of the computer industry, telecommunications industry, and
the transaction processing industry.
c. The erosion of the fun in the shopping experience
d. The rapid growth of qualified sales help in bricks-and-mortar stores
e. The consumers' desire to eliminate the middleman's profit
50. _____ sell products at a discount but do not carry certain brands on a continuous basis and carry those
brands they can buy from manufacturers at closeout or deep one-time discount prices.
a. Full-price stores
b. Department stores
c. Specialty retailers
d. Discounters
e. Off-price retailers
51. According to the text, what is the one important difference between off-price retailers and discounters?
a. Discounters carry only brands that they are able to get on special deals from the
manufacturer.
b. Off-price retailers offer better prices
c. Discounters offer greater selection
d. Off-price retailers offer more convenient locations
e. Discounters offer continuity of brands
52. Which of the following is an off-price retailer that is owned and operated by the manufacturer, and
stocks the manufacturers’ surplus, discontinued, or irregular products?
a. Warehouse club
b. Factory outlet
c. Supermarket
d. Supercenter
e. Independent carrier
53. Identify the incorrect statement about warehouse clubs.

a. They charge patrons an annual membership fee.
b. They sell a limited selection of brand-name grocery items, appliances, and clothing.
c. These mature-stage retailers operate out of enormous, low-cost facilities.
d. They sell a vast, unlimited selection of miscellaneous items at a deep discount.
e. Warehouse stores, which have low costs because they buy products at huge quantity
discounts and use limited labor, usually have low gross margins.
54. This retail format combines a discount store and grocery store to carry 80,000 to 100,000 products in
order to offer one-stop shopping.
a. Hypermarket
b. Off-price retailer
c. Supercenter
d. Recycled merchandise retailer
e. Liquidator
whole or in part.
55. Which of the following statements about supercenters is true?

a. They do not have a competitive advantage in the overstored American retail landscape.
b. They are capable of drawing customers from a 100-mile radius in most rural areas.
c. These stores charge patrons an annual membership fee.
d. They increase the customer’s total cost in terms of time and miles traveled.
e. They are a combination of supermarkets and discount department stores.
56. Most retail experts agree that _____ will NOT be one of the four new retail formats to be successful in
the near future.
a. liquidators
b. recyclers
c. off-pricers
d. supercenters
e. rental operations
57. What do the formats of stores such as those that recycle usable merchandise in good condition,
liquidators, and rental operations have in common?
a. They offer convenient locations
b. They offer the consumer value in an untraditional manner
c. They offer the customer one-stop shopping
d. They carry an ever-changing assortment of higher-quality merchandise
e. The growth for these formats appears to be limited
58. _____ are establishments that sell used and reconditioned products.
a. Liquidators
b. Diverters
c. Recycled merchandise retailers
d. Targeted refurbishment retailers
e. Supercenters
59. Which of the following statements about liquidators is false?

a. Liquidators do more than $15 billion in sales annually and earn between 3 percent and 7
percent of the sales.
b. Liquidators have a talent for pricing merchandise and estimating the expense of everything
from ad budgets and payrolls to utility bills.
c. They are often called retailing’s undertakers or vultures.
d. Most liquidators pay through credit for the merchandise—a plus for the strapped retailer—
and then take all the risks and gain the rewards.
e. They assume responsibility for a retailer’s leases, payroll, and other costs and agree either
to take a percentage of what they sell or agree in advance to purchase the existing
inventory.
whole or in part.
60. The rate of change in retailing around the world appears to be directly related to:
a. the internationalization of U.S. franchises such as McDonald's.
b. the internationalization of Walmart.
c. the use of discount stores as a retail format.
d. the stage and speed of economic development in the countries concerned.
e. the development of warehouse clubs.
61. The late Michael O'Connor, former president of the Super Market Institute, suggested that the failure
of many U.S. retailers to succeed in international markets was due to:
a. retailers from larger countries having operated in successful economies and therefore
tending to be less involved in the small details when going international.
b. customers from other countries not understanding how retailers should operate.
c. the competitive intensity in international markets being too high.
d. increased distribution costs making U.S. retailers uncompetitive when they expanded
internationally.
e. executives being sure of themselves, and not seeking more counsel or listening to more
opinions before developing strategic plans.
62. Technological innovations in retailing can best be viewed under three main areas:
a. Internet, order processing, and order taking.
b. Internet, supply chain management, and order processing.
c. Internet, customer management, and order processing.
d. supply chain management, customer management, and order processing.
e. supply chain management, customer management, and customer satisfaction.
63. _____ is a term used to refer to brands that are owned by the retailer.
a. Single brand
b. Retail brand
c. House brand
d. Private label brand
e. Manufacturer brand
64. Today, retailers typically view private label brands as:

a. secondary to national brands.
b. leading brands that serve as a destination draw.
c. too high cost to maintain effectively.
d. lower margin offerings of the retailer when compared to national brands.
e. throwaway brands.
65. Target has recently introduced Archer Farms Market as a separate department in its stores. This is an
example of:
a. two different independently owned retailers operating within one retail store.
b. Target allowing a national food manufacturer to set up its operations within Target's store.
c. leveraging of a famous national brand from France to operate in the U.S.
d. a private label branding strategy extended to a department.
whole or in part.
e. reintroducing products that have strong name recognition but that have fallen from the
retail scene.
TRUE/FALSE
1. Competition at the local level is often more complex than at the national or regional level.
ANS: T PTS: 1 REF: p. 114 OBJ: LO 4-1
2. Retailers today can achieve an above-average growth rate by maintaining their market share, since the
country's population is growing so fast.
ANS: F PTS: 1 REF: p. 114 OBJ: LO 4-1
3. Strategic plans that provide a differential advantage lead to high profit only if competitors need large
amounts of time or money to overcome them.
4. Local retailers cannot expect to compete with large discount stores such as Walmart and Target.
5. Clever strategies that differentiate the retailer cannot totally insulate it from competition.
6. A vending machine would be considered a primary competitor of a grocery store.
7. Market structures characterized as pure competition have heterogeneous products, few buyers and few
sellers, and ease of entry for both buyers and sellers.
8. Pure competition is common in retailing.
9. In pure competition, each retailer faces a horizontal demand curve and must sell its products at the
going “market” or equilibrium price.
10. The law of diminishing returns suggests that consumer demand for a specific product will increase
once a consumer has already purchased one unit of that product.
whole or in part.
11. While a chocolate-covered donut would taste great right now, the second, third, or tenth one,
purchased and consumed today, would be less desirable. This is an example of declining marginal
utility.
12. Situations of near monopoly do not exist
13. The distinction between monopolistic competition and oligopolistic competition is that in monopolistic
competition there are fewer sellers than in oligopolistic competition.
14. Under conventional economic thought, oligopolies occur when the top four firms account for over 60
to 80 percent of the market.
15. Outshopping occurs when customers go "out" and patronize the retailer's store rather than using other
methods of shopping such as telephone and mail order.
16. In a monopolistically competitive market, the retailer will be confronted with a negatively sloping
demand curve.
17. Most retailers face monopolistic competition.
18. Consumers will demand a lower quantity of a product as its price is raised.
19. Retailers must always match or be lower than the competitor’s price.
20. Nonprice strategies cannot be used to improve profit performance.
21. When all other factors are held constant, if one retailer offers superior service, it will have the net
effect of increasing the maximum quantity demanded by customers.
22. Many e-tailers require minimum-purchase requirements to qualify for free shipping and other price-
oriented benefits.
whole or in part.
23. Private label branding is an example of using nonprice competition to achieve a protected niche.
24. While most price decisions are directed at influencing demand, the retailer's use of nonprice strategies
seldom seeks to increase demand.
25. A market is in equilibrium in terms of number of retail establishments if the ROI is high enough to
justify keeping capital invested in retailing, but not so high as to invite more competition.
26. A market is considered "understored" when the number of stores is less than the current demand of the
market.
27. The early exit of many e-tailers was the result of the Internet being overstored given the demand at the
time, as well as many e-tailers’ inability to control back-office costs.
28. Competition is most intense in understored markets since many retailers are operating in stores too
small to carry all the merchandise demanded by customers.
29. Intratype competition is the most common type of retail competition.
30. Avon and Sears are engaged in intratype competition for cosmetics.
31. Intertype competition is increasingly seen as many retailers compete using a scrambled merchandising
strategy.
32. Family Dollar competing with Dollar General is an example of intertype competition.
33. Every time different types of retail outlets sell the same lines of merchandise and compete for the same
limited amount of consumer dollars available, intertype competition occurs.
whole or in part.
34. When a supermarket sells HMRs (home-meal-replacements), thus competing with nearby fast-food
retailers, the retailer is engaged in intertype competition.
35. When a discounter offers "on premises" dry cleaning service that competes with several other local dry
cleaners, this type of competition could be both intertype competition and divertive.
ANS: T PTS: 1 REF: p. 127-128 OBJ: LO 4-2
36. Divertive competition can be intratype, but not intertype.
37. The break-even point is where total revenues equal total expenses.
38. The wheel of retailing theory is an attempt to explain how retailers have reacted to the demands of
consumers in this "wheeling and dealing" competitive economic system.
39. According to the wheel of retailing hypothesis, retailers will earn significant profits during the
"maximizing phase".
40. The retail accordion theory can be used to understand why Hyatt developed four distinctive
hotel/motel formats.
41. The retail accordion theory proposes that transportation costs determine the size of a store's trading
area.
42. Today specialization in merchandise categories has once again become a dominant competitive
strategy.
43. The retail accordion theory has been used to explain Walmart's recent introduction of its 40,000
square-foot Neighborhood Markets grocery stores.
44. The retail life cycle has five stages: idea generation, introduction, growth, maturity, and death.
whole or in part.
45. Grocery stores are currently in the growth stage of the retail life cycle.
ANS: F PTS: 1 REF: p. 130-131 OBJ: LO 4-3
46. During the maturity stage of the retail life cycle, retailers will achieve the highest level of profits.
47. It takes a long time for a retail format to move through the introduction stage of the RLC; however,
after it reaches the growth stage, the new format will move rapidly through the next five stages.
48. It is possible to delay the decline stage of a retail life cycle by changing the firm's retail mix.
49. The resource-advantage theory teaches that all retailers are able to achieve superior results at the same
time.
50. Superior performance at any point in time is the result of achieving a competitive advantage in the
marketplace as a result of some tangible or intangible entity.
51. All retailers can and do achieve superior results at the same time.
52. Retailers today can expect an increase in competition from both nonstore retailers and the introduction
of new retailing formats that will change the way retailing currently occurs.
53. The growth of nonstore retailing is based on accelerated communication technology and changing
consumer lifestyles.
54. The only prerequisite needed for the Internet’s success is having enough consumers with access.
55. Experts predict that e-tailing will soon make up 75 percent of the retail marketplace.
56. The Internet will increase overall consumer demand.
whole or in part.
57. Bricks-and-click strategies that integrate a single message and seamless operations will be more
powerful than a pure e-tailing strategy.
58. E-tailers must pay better attention to customer service.
59. The most successful new retailing format introduced in the United States during the last decade was
the hypermarket.
60. The major advantage held by off-price retailers over discounters is that they provide consumers with a
consistent selection of top brands at reduced prices, whereas discounters’ selections are more volatile.
61. The birth of recycled merchandise retailers can be traced to the great depression.
62. The closure of more than 300,000 retail stores between 2008 and 2009 as a result of bankruptcy
provided a new retail growth format: liquidators.
63. Running closeout sales for a retailer is the easiest job in retailing because the goods are so cheap.
64. The rate of change in retailing around the world appears to be directly related to the stage and speed of
economic development in the countries concerned.
65. Inflation has recently been outstripping price increases.
66. Retailing in other countries exhibits less diversity in its structure than retailing in the United States.
67. Retailers from large countries are often better suited to expand internationally than retailers from
smaller countries.
68. Several apparel retailers have recently entered the American market due to the weak dollar.
whole or in part.
69. The United States is a low-growth market in which retailers have long had to fight for market share.
70. The United States remains the world’s largest consumer market.
71. Technological integration in retailing can be viewed under the areas of supply chain management,
customer management, and customer satisfaction.
72. Retailers who continue to use technology in innovative ways within the supply chain will achieve
greater efficiency in their operations.
73. Activity-based costing analyses demonstrate that, in categories with mixed distribution, products just
going through the warehouse consistently outperform DSD products.
74. Retailers believe that the use of national brands offers greater opportunities than private branding
strategies.
75. Retailers must remember that most department store shoppers value a product’s brand name more than
the product’s style.
76. Retailers have found private label branding strategies so successful that they are using private label
brands for entire departments.
ESSAY
1. Discuss how the four different market structures influence retailing.
ANS:
The four different market structures that influence retailing are pure competition, pure monopoly,
monopolistic competition, and oligopolistic competition.
In pure competition, each retailer faces a horizontal demand curve and must sell its products at the
going “market” or equilibrium price. The retailer could not sell merchandise at a higher price because
customers know they can buy the item for less. Pure competition is rare in retailing.
whole or in part.
In a pure monopoly, the seller is the only one selling a particular product and will set its selling price
accordingly. However, as the retailer seeks to sell more units, it must lower the selling price. This is
because consumers who already have one unit will tend to place a lower value on an additional unit.
This is called the law of diminishing returns or declining marginal utility.
Monopolistic competition occurs when the products offered are different, yet viewed as substitutable
for each other and the sellers recognize that they compete with sellers of these different products.
Oligopolistic competition occurs when relatively few sellers, or many small firms who follow the lead
of a few larger firms, offer essentially homogeneous products and any action by one seller is expected
to be noticed and reacted to by the other sellers. Nonprice competition is extremely difficult since
consumers view the products and services as essentially the same.
PTS: 1 REF: p. 117-119 OBJ: LO 4-1
2. What factors (other than price) do customers place a value on? How can a retailer use these factors to
create a differential advantage?
ANS:
Many customers place a high value on attributes other than price when selecting a place to shop.
Retailers must understand that nonprice elements of the retail mix—merchandise mix, advertising and
promotion, customer services and selling, and store layout and design—can have a significant impact
on the quantity of merchandise they sell and the profit levels they achieve. Retailers must be aware
that certain nonprice variables will be more successful than others given the market segments they
choose to target.
Some of the ways a retailer could use nonprice variables to achieve a protected niche are:
• The retailer could position itself as different from the competition by altering its
merchandise mix to offer higher-quality goods, greater personal service, special-orders
handling, or a better selection of large sizes.
• Store positioning is when a retailer identifies a well-defined market segment using
demographic or lifestyle variables and appeals to this segment with a clearly differentiated
approach.
• The retailer can offer private-label merchandise that has unique features or offers better
value than do competitors.
• The retailer could master stockkeeping with its basic merchandise assortment.
A variation of nonprice competition is to become a “destination” store for certain products.
PTS: 1 REF: p. 120-125 OBJ: LO 4-1
3. Why is competition so intense in overstored markets?
ANS:
A good measure of competitive activity in a market is the number of retail establishments of a given
type per thousand households. When the number of stores per thousand households gets too large, the
market is considered overstored. These retailers face a major performance imperative because often
their return on investment is below their cost of capital. As a result, they will implement both price and
nonprice actions in an attempt to increase both sales and profits. This highly competitive situation
reduces the average return on investment and lowers the profitability of all retailers. Some will
eventually exit the market.
PTS: 1 REF: p. 125 OBJ: LO 4-1
whole or in part.
4. Given the various types of competition, why is it so important for a retailer to develop a protected
niche?
ANS:
To comprehend the significance of divertive competition, which can be intertype or intratype
competition, one needs to recognize that most retailers operate very close to their breakeven point. Due
to the changing nature of retailing, retailers are often forced to alter their strategy as their competition
changes. The retailer has to position itself as different from the competition by altering its merchandise
mix to offer higher-quality goods, greater personal service, special-orders handling, or a better
selection of large sizes and distinguish itself from competitors in specific ways in order to be the
preferred provider for certain market segment. Such features may increase the maximum price
consumers are willing to pay or the distance consumers are willing to travel to shop for these goods,
thereby enlarging the retailer’s trade area. The retailer has to offer private-label merchandise that has
unique features or offers better value than do competitors. The retailer has to become a destination
store in order to protect its niche clientele. Most retail decision variables, whether price or nonprice,
are directed at influencing demand.
PTS: 1 REF: p. 123-128 OBJ: LO 4-1 | LO 4-2
5. How does the wheel of retailing theory explain the patterns of change in a retailer's operations?
ANS:
The wheel of retailing theory states that new types of retailers enter the market as low-status, low-
margin, and low-price operators. This entry phase allows retailers to compete effectively and take
market share away from traditional retailers. However, as they meet with success, these new retailers
gradually enter a trading-up phase and acquire more sophisticated and elaborate facilities, often
becoming less efficient. This creates both a higher investment and a subsequent rise in operating costs.
This stage is referred to as the “Big Middle,” a market space where the largest numbers of potential
customers reside. Predictably, these retailers will eventually enter the vulnerability phase and must
raise prices and margins to cover rising costs. In doing so, they become vulnerable to new types of
low-margin retail competitors who progress through the same pattern. While the wheel of retailing
may explain the evolution of some retail forms, it is less clear about the success of some new niche
retailers; retailers that successfully compete on nonprice factors, such as luxury retailers or
convenience stores; and the role of cost control in improving customer satisfaction as well as
competitiveness.
PTS: 1 REF: p. 128-129 OBJ: LO 4-3
6. Compare and contrast the four theories of retail evolution.
ANS:
The wheel of retailing theory states that new types of retailers enter the market as low-status, low-
margin, and low-price operators. This entry phase allows retailers to compete effectively and take
market share away from traditional retailers. However, these new retailers enter a trading-up phase and
acquire more sophisticated and elaborate facilities, often becoming less efficient, which creates a
higher investment and a subsequent rise in operating costs. The theory is not clear about the success of
some new niche retailers; retailers that successfully compete on nonprice factors; and the role of cost
control in improving customer satisfaction and competitiveness.
whole or in part.
The retail accordion describes how retail institutions evolve from outlets that offer wide assortments to
specialized stores and continue repeatedly through the pattern. The theory is vague about the
competitive importance of providing wide assortments for various target customer groups. A major
criticism of this theory is its implication that there is one “right” direction for successful retailing,
when many are possible if well executed.
The retail life cycle describes four distinct stages that a retail institution progresses through:
introduction, growth, maturity, and decline.
• The introduction stage begins with an entrepreneur who is able to develop a different
approach to the retailing of certain products. Most often the approach is oriented toward a
simpler method of distribution and passing the savings on to the customer. Profits are low
due to amortizing developmental costs and not yet achieving sufficient scale economies.
• During the growth stage, sales and usually profits explode, and new retailers enter the
market and begin to copy the idea. Cost pressures arise from the need for a larger staff,
more complex internal systems, increased management controls, and other requirements of
operating large, multiunit organizations. Consequently, both market share and profitability
tend to reach their maximum level.
• In maturity, several factors cause market share to stabilize and profits to decline. Managers
have become accustomed to managing a high-growth firm that was simple and small, yet
now they must manage a large, complex firm in a nongrowing market; the industry has
typically overexpanded; competitive assaults increase as firms with new retailing formats
enter the industry.
• Although decline is inevitable for some formats, retail managers will try to postpone it by
changing the retail mix. These attempts can postpone the decline stage, but a return to
earlier, attractive levels of operating performance is unlikely. A major loss of market share
will occur and profits will fall.
The resource-advantage theory argues that firms gain competitive advantage by offering superior value
to customers and/or having lower costs of operating. According to this theory, (a) superior
performance is the result of achieving a competitive advantage in the marketplace as a result of some
tangible or intangible entity; (b) all retailers cannot achieve superior results at the same time.
PTS: 1 REF: p. 128-133 OBJ: LO 4-3
7. Explain the changes in the grocery industry using one of the four retail evolution theories.
ANS:
The four theories used to explain the evolution of retail competition are the wheel of retailing theory,
retail accordion, the retail life cycle, and the resource-advantage theory. Student answers would vary
depending on the choice of theory they opt for.
According to retail accordion, retail institutions tend to evolve from outlets that offer wide
merchandise assortments to specialized stores that offer narrow assortments and then return to the
wide assortment stores, continuing this pattern again and again. Retail trade in the United States was
dominated by the general store until 1860. The general store carried a broad assortment of
merchandise ranging from farm implements to textiles and food. After 1860, retail trade became more
specialized and was concentrated in the central business districts of cities. By 1880 to 1890,
department and specialty stores were the dominant competitive force; both carried more specialized
assortments than the general store. In the 1950s, retailing began to move again to wider merchandise
lines. Typical was the supermarket, which added produce and dairy products and nonfood items.
Today, specialization in merchandise categories has once again become a dominant competitive
strategy. An example is the success of Walmart which is heeding this trend by building freestanding
40,000-square-foot Neighborhood Market grocery stores in selected cities.
whole or in part.
PTS: 1 REF: p. 128-130 OBJ: LO 4-3
8. Discuss the underlying factors stimulating nonstore retailing.
ANS:
The growth of the nonstore retailing form of selling is based on accelerated communication technology
and changing consumer lifestyles. Retailers need to continuously monitor developments in nonstore
retailing. The general belief among retail experts is that electronic, interactive, at-home shopping is
definitely the place to be. Every major player in the retail, computer, telecommunications, and the
transaction processing industries is committed to this growth. The only prerequisite needed for the
Internet’s success is having enough consumers with access, via a personal computer, cell phone, or
BlackBerry. More than 80 percent of American households are connected either at home or at work,
and more people now use cell phones and not landline phones as their primary means of phone
communication. Americans will make increasing use of the Internet as a shopping method because of
its convenience and broad selection. Browsing will be easier and the choices more extensive. The most
significant contribution of the Internet to retailing is that it has enabled everyone to be a retailer, albeit
a microretailer, by using eBay. This tremendous impact on individuals of all ages is best seen by the
number of training seminars, community colleges, senior centers, and so on, offering classes on how to
buy and sell on eBay.
PTS: 1 REF: p. 134-137 OBJ: LO 4-4
9. Explain how eBay changed the opportunities available to microretailers.
ANS:
The most significant contribution of the Internet to retailing is that it has enabled everyone to be a
retailer, albeit a microretailer, by using eBay. eBay has enabled individuals working from their homes
to become microretailers who can reach a global marketplace and compete with the world’s best-
known retailers. In the past, their relatively small trade area and merchandise assortment limited their
competitive threat to more traditional retailers. However, the retail world is changing, and eBay—with
merchandise covering 4,300 categories—is one of the catalysts. eBay can be credited with
reinvigorating retailing in the world economy. There is tremendous potential for financial freedom and
work flexibility.
PTS: 1 REF: p. 136-137 OBJ: LO 4-4
10. What new retail formats are currently developing, and how are these formats changing the retail
environment?
ANS:
Three successful formats developed over the last decade and that are expected to continue are stores
that recycle merchandise retailers, liquidators, and rentals. All three formats offer the consumer value
in an untraditional manner.
• Recycled Merchandise Retailers: As a result of the economic slowdown, recycled
merchandise retailers have experienced significant growth. As a record number of retailers
were seeking bankruptcy protection in 2009, these stores saw a growth rate approaching 20
percent. Recyclers have developed to serve specific markets.
whole or in part.
• Liquidators: These firms purchase the entire inventory of the existing retailer and run its
‘going-out-of-business” sale. They assume responsibility for a retailer’s leases, payroll, and
other costs and agree either to take a percentage of what they sell or agree in advance to
purchase the existing inventory. Retailers do not do this job themselves for the following
reasons: The retailers in question usually have problems that require the liquidator’s service
in the first place. Second, most liquidators pay cash for the merchandise and then take all
the risks and gain the rewards. Finally, by having outsiders run the closeouts, management
can focus on operating the continuing stores and moving on to more successful
merchandising. Liquidators sometimes augment sales by bringing in new merchandise or
by adding leftovers from previous liquidations. Liquidators are considered experts at
pricing merchandise and estimating the expense of everything from ad budgets and payrolls
to utility bills. Liquidators also have to develop special incentive plans to make it more
profitable for store personnel to stay and work rather than quit or walk off with
merchandise.
• Rentals: Renting has been popular for a limited number of items for decades. the recent
slumping economy has generated a renewed interest in this format for an expanded
category of products. Retailers are coming up with innovative schemes in rentals to cater to
the renewed interest in rentals. An example of innovative rentals caters to the following
needs of students: cars by the hour, fashion items, and textbooks. An hourly rental scheme
for cars is attractive to customers who make only occasional use of a vehicle. Similarly,
after paying a small monthly fee, college students can rent a great looking stylish handbag
by the month. The typical college student spends slightly more than $500 a term for
textbooks and gets around $200 when selling them back at semester’s end. Today, more
than two dozen e-tailers offer students millions of texts to choose from and allow them to
rent books for a set period, anywhere from a month to a semester or summer—the rental
term determines the cost.
PTS: 1 REF: p. 138-142 OBJ: LO 4-4
11. Why are retailers from larger countries less successful when expanding internationally than retailers
from smaller countries?
ANS:
The rate of change in retailing around the world appears to be directly related to the stage and speed of
economic development in the countries concerned, but even the least-developed countries are
experiencing dramatic changes. New types of changing retailing formats can be attributed to a variety
of economic and social factors that are the same worldwide. Many new retail concepts and formats
have emerged and spread. Still, retailers from larger countries often do not have the same success,
compared to that of retailers from smaller countries, when entering a new country. Retail experts
attribute this failure by large-country retailers to two factors. Some think it is a lack of understanding
of the new country’s culture. According to Michael O’Connor, former president of the Super Market
Institute and retail consultant, the failure of many retailers to succeed in international markets was the
result of larger countries having successful economies and retailers becoming accustomed to success;
whereas, retailers in smaller countries do not take success for granted and tend to take more time and
be more careful with key decisions.
PTS: 1 REF: p. 142-143 OBJ: LO 4-4
12. In what three areas, discussed in the textbook, are retailers beginning to integrate technology to
increase their chances of providing value in the market?
ANS:
whole or in part.
Technological innovations can be grouped under three main areas: supply-chain management,
customer management, and customer satisfaction.
The plethora of supply-chain management techniques such as quick response, just-in-time, and
efficient consumer response are being enhanced by new initiatives such as direct store delivery (DSD)
and collaborative planning, forecasting, and replenishment (CPFR) systems. DSD systems can fully
automate all retail inventory operations from tracking vendor and item authorization to pricing and
order taking. These systems provide greater accuracy and increased administrative efficiency, allowing
retailers to achieve cost advantages. CPFR systems have the potential to move retailers and
manufacturers far beyond continuous-replenishment models in terms of reducing excess inventory
levels, cutting out of stocks at retail, and efficiently meeting consumer demand. Retailers who continue
to use technology in innovative ways within the supply chain will achieve greater efficiency in their
operations and higher levels of effectiveness. One cause of long lines at supermarket checkouts is that
each item has to be taken out of a shopper’s cart, individually scanned, and then bagged. Recent
testing of radio frequency identifiers (RFIDs) on products might eliminate the item-by-item process
completely. Although still too expensive for all but high-priced items, advancements in technology
will soon be available, making this system affordable to implement.
PTS: 1 REF: p. 143-145 OBJ: LO 4-4
13. Explain why a retailer may wish to engage in a private label branding strategy.
ANS:
As retailing continues to change, the increased use of private labels has emerged as a key business
asset in developing a differential advantage for retailers. Private labels can set the retailer apart from
the competition, get customers into their store or website and bring them back. Today retailers are
shifting their emphasis on the development of private-label brands into high gear by using a variety of
strategies to build the image of their brands, expand brand recognition, and raise their brand images in
the marketplace. Private-label brands often have lower wholesale and marketing costs, resulting in
higher levels of profit compared to manufacturers’ brands. Retailers must remember that most
department store shoppers value a product’s style more than the product’s brand name.
In the past, retailers believed that national brands drew customers into their stores, set the standard,
and lent credibility to the retailers. At the same time, retailers felt private-label brands could help
retailers differentiate their offerings, reach customers seeking lower prices, and boost margins due to
the lower costs of private-label merchandise. However, over the past decade, many retailers have
started focusing on developing strong, proprietary private-label brands as their leading brand and
supporting them with major advertising and promotional programs. Private brands are now effectively
serving as destination draws in their own right while still providing many of the same benefits of
traditional private-label programs. Today, it is not uncommon for major retail chains to generate a
third or more of their sales from private labels.
PTS: 1 REF: p. 145 OBJ: LO 4-4
14. A local retailer has asked for your help in developing a private branding strategy for their firm. What
specific strategies would you suggest the retailer employ? Why?
ANS:
The following are some of the private-label branding strategies that can be used by retailers.
• Develop a partnership with well-known celebrities, noted experts, and institutional
authorities. Celebrity partnerships allow retailers to align with an individual whose personal
reputation creates immediate brand recognition, image, or credibility.
whole or in part.
• Develop a partnership with traditionally higher-end suppliers to bring an exclusive

variation on their highly regarded brand name to market. The retailer gets an exclusive
private label and the opportunity to expand customer appeal, ratchet up price points, and
raise margins. The manufacturer builds volume and gains access to a broad new market
spectrum.
• Reintroduce products that have strong name recognition but that have fallen from the retail
scene. Old brand names get recycled. Retailers can add cachet to their store image by
resurrecting former up-market brands that have been discontinued but have not lost their
image. Recycled brands can help a retailer achieve differentiation through exclusivity and
attract consumers unwilling to risk buying an unknown brand name. By reviving a well-
known brand, the retailer is able to leverage the brand’s equity while still having a
proprietary line.
• Brand an entire department or business; not just a product line.
PTS: 1 REF: p. 145-147 OBJ: LO 4-4
whole or in part.
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tell him that I'm a woman and he's a man, and so the cases is very
differential. And what is he starving himself for, now? As I says to him,
while there was a chance of righting the business and keeping his
connection together, it was all very well to be miserly; but now that he's
broke, and had to retire to this place, which others that expected it as
little, though never keeping a carriage nor having a viller at 'Ackney,
mightn't he as well make use of the comforts provided for him, and not
go on pinch, pinch, and look at a friendly neighbour as if he'd like to bid
her to mind her own business? But there! A hard man Ralph Trulock
ever was—hard to his son, and hard to all, and hard he'll be, to his dying
day."
"He does not look like a hard man, exactly," said May Cloudesley.
"Ah, but if you knew his story, ma'am, which I can tell it to you, for I know
it well. I've known him all my life."
May by no means wished to listen to gossip of this kind; but she found
she must listen to Mrs. Short, or abruptly say good-bye, and this she did
not like to do. She was not one of those who have one manner for the
rich and another for the poor; so it was as impossible for her to interrupt
Mrs. Short rudely, as if she had been my Lady Short, and the vulgar little
crowded parlour a spacious reception room; so she heard her perforce.
"Ralph and me were married in the same year, and his shop—it was a
shop then, afterwards an establishment, if you please—was in our
street. My Matthew was a baker,—I ain't ashamed of it,—Ralph Trulock
was a master tailor, what they call a milingtery tailor, uniforms and the
like, and officers always going in and out, going to India and sich. He got
on wonderful—often I said to my poor Matthew that's dead and buried,
that pride will have fall, and a 'aughty sperrit goes before bankruptcy,
which is as true a word as any other Solomon ever said. And yet it
lasted a long time, too. Mrs. Trulock had her carriage, and Fred his
pony, and afterwards his horse, and they lived in a viller like the gentry,
and Ralph looked down on Matthew and me, as if we were no more than
a couple of our own penny rolls. The boy grew up—and a fine young
man to look at—but got into fine company through knowing the officers
that came to the shop, and it was he could spend faster than Ralph
could save. And his father was terrible hard on him—Ah! A hard man
Trulock was, even then, and—"
Here the welcome sound of a knock at the door reached May's ears.
She sprang from her chair, saying, "That is Mr. Cloudesley; he promised
to come for me."
"I'll let him in, ma'am—what, you must go? Well, I must finish my story.
Fred spent everything, and then ran away because the father was so
hard on him, and left Trulock in debt awful—he's never got before the
world since, and had to pay half a crown in the pound, and the wife died
—"
"I beg your pardon, Mrs. Short, but Mr. Cloudesley must find it very
cold."
"Yes, ma'am, I must let the dear gentleman in. And Ralph, ma'am—I
have my own suspicions about the way things went at the last; but that's
neither here nor there, and certain it is his behaviour killed his wife; and
when Fred ventured back, he cursed him frightful, and has always sent
back his letters, just tore up, and—"
"I really must not keep Mr. Cloudesley waiting any longer; that is the
third time he has knocked," cried May in desperation; and going quickly
to the door, she opened it herself.
Mrs. Short followed her as fast as she could, and began at once:
"Well, sir, you must not think me unmannerly for letting your good lady
open the door for you, for we were so interested in what we were
saying, that we quite forgot that you had knocked, and then when you
knocked again she ran like a hare, and I hadn't a chance with her. Must
you go at once, sir? Well, ma'am, call again soon, and I'll tell you plenty
more about him; but you may take my word for it, he brought that boy up
very badly, and then turned on him, broke his wife's heart, and owes a
mint o' money, leastways did, but went through the courts, you know,
and got himself whitewashed; and what he's starving himself for now I
don't know, and I'd give my ears to find out, though not curious by
nater."
"Good evening, Mrs. Short," said May gravely, as she took her
husband's arm and turned away.
"Oh, Gilbert, I do not like Mrs. Short; and if what she has been telling me
is true, we shall not like Mr. Trulock either."
"What has she told you? You look half dead, May."
"Nothing tries me like having to listen to talk like that; but she told me—"
and May repeated the substance of Mrs. Short's story.
"Well, I know nothing of the man myself, but this is certain," said Mr.
Cloudesley in reply. "Mrs. Short may abandon her suspicion that he
behaved dishonourably in any way; for if he had, he would not have
been admitted here. I fancy he is very unhappy, poor old fellow; you
must make friends with him, May."
"But, Gilbert, if he really turned his son out of doors and cursed him?"
"If that is true, he must be a miserable man, May."
"You are right. Yes, Gilbert, I'll go and see him again."
May Cloudesley went several times to visit Mr. Trulock before she found
him at home; and her ineffectual knock at his door never failed to bring
Mrs. Short to hers, urging her to come in and "have a chat." Sometimes
May escaped, but more often she was obliged to go in and listen
unwillingly to much gossip, principally about poor old Ralph, but many of
the other neighbours were also discussed. Still Ralph was plainly a
mystery to her, and (of course in the most good-natured spirit) Mrs.
Short talked incessantly about him. At last Mrs. Cloudesley determined
to go quite early some day, and try if she could catch Trulock; before he
was off on his wanderings. It was not quite ten o'clock when she raised
her hand to knock at his door, and before she had reached the knocker
the door opened, and Ralph, in a worn great-coat and shabby muffler,
stood before her. He looked even more depressed than when she had
seen him last.
"Good morning, Mr. Trulock. I am a very early visitor, but later in the day
you are never at home, and I wanted so much to see you."
"You are very good, madam. I don't know why any one should trouble
themselves about such as I am now. Will you walk in, madam?—though
I fear you will find it cold."
"Oh, I am very well wrapped up; I don't mind the cold."
"I sit in the kitchen, madam, in order to keep but one fire," said Ralph,
leading the way to that very melancholy apartment, where he placed her
in a chair near the grate; she perceived that the fire was raked out, and
the dismal chill of the room was most depressing.
May looked round, and then up into the face of the old man, and
wondered if she could venture to beg him to allow himself the comforts
he so sadly needed. He was watching her with a strange, sad smile.
"I know what you are thinking, madam," he said. "My neighbour, Mrs.
Short, has been telling me that she informed you that I am starving
myself to death; and I have no doubt she told you more than that. She
would not spare me. I was a fool to come here—but truly I had little
choice. She has given me a bad name with every one."
May could not deny this, so she said:
"I wish you would make yourself a little more comfortable, Mr. Trulock. I
cannot bear to think of the life you seem to lead. This place, you know,
was meant to make those who live here comfortable."
"I am as comfortable as I—wish to be," Ralph replied.
"But—please forgive me for speaking plainly—you know this place—the

money here—was meant to be used to make you comfortable; don't you
think you ought to use it as it was intended?"
"Comfort, Mrs. Cloudesley, is a matter of feeling; if I do what I wish to

do, I am more comfortable than I should be if I were doing what I don't
wish."
He sat down as he spoke, for hitherto he had been standing, and said:
"Madam, you are very kind to me, and I should not wish you to think
worse of me than I deserve. I don't know what you may have heard from
Mrs. Short, nor even what you may conclude from my own words and
conduct. May I briefly tell you the truth concerning myself, madam, and
then at least I shall know that you are not misled about me."
"Indeed, I will listen with great interest," said May. "I fear you have had
many trials."
"I have, indeed; but people say I brought them on myself."
"That, even if true, does not lighten them."
"No," he replied, with his slow, grave smile; "that is true; but it hinders
sympathy, I find. You know, perhaps, that I began life as an apprentice in
a great military outfitting shop in London? I was hard-working and
careful, and got on well. I set up for myself when I married, as my wife
had a little money, and I had saved. I prospered greatly. My business
grew and grew; I was soon a rich man. I had the best wife, madam, that
ever man was blessed with, and a fine boy—only the one child. I said I
would make a gentleman of him. I gave him every advantage—I never
said No to him—I—"
His voice trembled, and he was silent for a minute.
"Madam, I find that I cannot speak much of him, even now. I do not
believe he ever knew what he was to me. I ruined him by over-
indulgence—letting him have too much money; and then, when I began
to fear he was going astray, I pulled him up too short. Then—I see it now
—I went as much too far the other way—would give him no money, and
wanted to part him from all his acquaintance, because I thought they
helped to make him idle. He was idle—that I know—but he was good
and affectionate until—Well, he rebelled; got into debt; borrowed money
right and left. My business went down, for I was forced to make my
customers pay up their bills, and that makes discomfort. People
naturally go where they get credit. All went wrong with me; and my poor
Annie took the boy's misdoing so much to heart that she lost her health."
"Poor thing—oh, poor mother!" whispered May.
"The boy went from bad to worse. At last—I never told this to mortal
before except my poor Annie, and she guessed it. I had a large sum of
money coming to me, and I depended on it, as I had a great payment to
make. He knew it; he went the day before I was to receive it, and got it,
saying I had a sudden need for it, and had sent him. And then he
disappeared. I concealed his—theft—from every one except my wife—
she guessed it, and it finished what his wild doings had begun. She
never held her head up again, madam. She pined away, longing for her
boy, that she might try to bring him to a sense of his faults; but he never
came. I put advertisements in the paper, begging him to come home,
and that all should be forgiven; but he never saw them. He was abroad,
I believe. At last—she died; and the night before her funeral, Fred,
knowing nothing of this, came home. He came in on me suddenly, and I
had no heart to speak. He said he had seen the advertisement at last,
and had come home to confess that he was married,—and he told me
who the girl was. A good girl, I believe; but she belonged to bad people
—low, dishonest folk, in a small way of trade—and my heart rose up
against the thought of her bearing my Annie's name, and she lying in
her coffin. I got up—" Ralph straightened himself and spoke louder, "I
opened the door; I said, 'Your mother lies dead upstairs, murdered by
you. You have brought her to the grave, and me to ruin. Go to the wife
you have chosen—never let me see your face again.'"
"Oh, Mr. Trulock! Surely he did not take you at your word? Surely he
saw that you were speaking wildly?"
"He had his faults, madam, but want of affection was never one of them.
He tried again and again—he both wrote and came to the house; but I
would neither see him nor read his letters. I was mad, I think; mad with
sorrow and anger. At last he got a friend to trick me into reading one
letter, the last he ever wrote to me. He said he saw that I could not
forgive him, although he hoped I would believe that he had not meant to
leave his mother to die without seeing him; that he was going to
emigrate, and that he would repay the money he had taken from me as
soon as he could. I have never heard of him since—not a word."
"He will come yet," said May; but Trulock shook his head.
"I think he must be dead," he said in a low voice. "Then I began to try to
pay my creditors, and retrieve my business. I struggled on alone,
madam, for twelve weary years, during which I never spent an
unnecessary penny—only to fail at last. I paid seventeen and sixpence
in the pound, and—I must pay the other half-crown before I die. That is
what I am saving for, Mrs. Cloudesley. I can allow myself no comforts
until that is done."
May was crying, and made no answer.
"God bless you, madam, for those tears!" said Trulock, earnestly. "You're
sorry for Annie;—yes, and you would have learned to love her—you
would have loved Annie."
"I'm crying for you, not for her," May said, looking up. "I'm so sorry; yours
has been a sad, sad life. Annie is at rest."
"Yes," he answered, "Annie is in heaven; she was a saint, if ever there

was one."
"Ah!" said May, smiling. "How that takes the sting out of the sorrow! But
will you let me tell my husband what you have told me? And I will try to
see you soon again, and tell you if he thinks that you are doing right
now. Gilbert is so upright—he would know."
"You may tell him, but no one else, madam, if you please. I do not care
to defend myself; let people believe Mrs. Short if they like. I care nothing
for their opinion."
"Yet you must be very lonely."
"I don't care for company; I feel as if every one was a stranger, and must
always be so—and I think I don't wish it otherwise."
"Mr. Trulock, that is not the way to grow Christmas roses."
"But I told you none would grow for me, madam."
"They won't grow except in their own soil. Good-bye,—when shall I have
a chance of seeing you again?"
"I cannot have you troubled to come out so early on my account," Ralph
answered. "If you will leave word at the gate, appointing your own time, I
will be here. You have been very kind, madam, and I feel it deeply; but
do not mistake me, I do not promise to be ruled by what you and Mr.
Cloudesley may advise."
"Yet we may talk it over with you. Good-bye then, Mr. Trulock. I will leave
a message for you."
As May hurried away, she heard Mrs. Short calling her. She stopped,
and that worthy dame actually followed her, cold as it was.
"You've sat a long time with Trulock," said she. "I hope, ma'am, that he
was civil?"
"Civil!" said May, laughing. "Oh dear, yes, Mrs. Short. I like Mr. Trulock
very much indeed. Good morning, for I have sat so long with him that I
must hurry home now."
Mrs. Short retired to her house, much disgusted.
"After all I've told her, not to tell me one word of what passed between
'em! I could see that she cried,—but the winders is so small! It's very ill-
natured of her; and if I did right I'd never tell her another thing!"
CHAPTER III.
MAY CLOUDESLEY SPEAKS HER MIND.
SEVERAL engagements prevented Mrs. Cloudesley going to Lady

Mabel's Rest as soon as she had intended, but at last she succeeded in
keeping an hour or two clear for her visit, so she sent a message to Mr.
Trulock very early, to say that she would be with him at one o'clock, if
convenient to him. She was such a punctual little body, that she ran past
Mrs. Short's windows just as that lady's gorgeous clock struck one, and
for a wonder she got by unperceived, for it was Mrs. Short's dinner hour,
and she had no eyes for the passers-by. Mr. Trulock took her at once
into the kitchen, where he had a good fire burning, and for the first time
May saw what a snug room that kitchen could be.
"Well, Mr. Trulock, did you think I had forgotten you? You don't know
how busy we have been."
"I had no fear that you would forget me," Trulock answered, quietly.
"Mr. Cloudesley would have come with me—for he is so much interested

in what you told me; but he fancied that as you had spoken to me
before, you might like to talk to me this time also."
"Well, I think Mr. Cloudesley is right," said Trulock with a smile. "I don't
know that I could talk to any one else as I did that day to you. I
wondered at myself when you were gone, for I had not meant to trouble
you with so long a story."
"But you did not trouble me, except that I was sorry for you. Well, it
seems that my husband saw a letter, written by a Mr. Arnott, and signed
by all your other creditors, which was sent to Mr. Barton when you were
named for this place; in which they say that your conduct had been so
honourable as to command their admiration; that they had had dealings
with you for many years, and felt that in spite of your failure they had lost
nothing by the connection."
"I saw the letter," said Trulock, shortly.
"And they said that they were all most anxious to secure your election;
that they could quite afford to lose the very trifling sums you had not
paid, and that they had written to you to that effect."
"So they did. But, young lady, I could not rest in my grave knowing that I
owed any one a penny."
"Your creditors were all rich men, I think?"

"All of them. Except in the way of business I never owed a penny, and I
dealt only with the best houses."
"Suppose you had not been elected to the Rest, I think they meant to
have made a subscription for you, Mr. Trulock."
"Madam!" said the old man almost fiercely, "I would have gone to the
poorhouse before I accepted their charity!"
"Ah, Mr. Trulock! That is what Gilbert bid me say to you!"
"What?" cried Ralph, with a start. "That I ought to have done that—gone
to the poorhouse?"
"No, no,—but that you must look well to it that in this matter you are not
governed by pride rather than by any better feeling."
"I have always been a proud man," Ralph answered, drawing himself
up. "Mrs. Cloudesley, in living on the barest necessaries of life—and that
I do, for bread and water are my usual food, and I roam the country to
keep myself warm, to save firing,—I am doing the only thing that can
reconcile me to life. People talk of me now as a beaten man, glad to
hide my head in an almshouse, because ill-health, sorrow, and age
made it impossible for me to begin life again. But before I die, I will
prove to these proud, successful men, that I was not so utterly beaten;
that, in spite of age, and failing health, and sorrow to boot, I fought the
battle and kept my honourable name. When I have paid the money, I
may be able to feel grateful to Arnott and the rest for what they said and
did—as it is, I can only just keep from hating them."
May looked at him with a deep sorrow in her sweet eyes.
"Oh, Mr. Trulock," she said, "do forgive me if I speak my mind—and

Gilbert's, for he thinks as I do about it. Is that a Christian spirit? Your
creditors wished to forgive you this debt, they felt kindly towards you,
and were glad that you should not be left in poverty. You are in an
asylum planned to make those who have been unfortunate forget their
difficulties and pass a peaceful life, with every comfort, even to the
power of doing something for others. But you refuse to accept anything,
either from your old friends or from poor dead Lady Mabel; you shut-up
your heart, and will admit no happiness, no kind feeling,—but just fight
on, doggedly, to do what no one wants you to do—to pay back money
which no one needs (for the sums are too small to make any difference
to prosperous men), and all because you are too proud to accept a
kindness from any one, living or dead."
"The money may make no difference to them," said Ralph; "but it makes
all the difference in the world to me."
"But only because you are proud. Why should you not allow men who
think well of you to show you a kindness? Why not submit to the failure
of your business, and try to find peace here, where there are so many
who would be friendly if you would allow them? And Lady Mabel didn't
mean her bequest to be used except for the benefit of those to whom
she left it."
"I asked Mr. Barton if there was any rule obliging me to spend the
money, and he said certainly I might do as I liked," Ralph replied.
"Madam, I warned you that I could not promise to be guided by you. You
were kind to me, and I thought I should like you to know the plain truth
from my own lips; and then you listened so kindly that I was led on to
say more than I intended. But I could not change my nature at this time
of day, madam. A proud man and a hard man I have always been;
giving nothing for nothing, accepting no favours. I've lived so, and I
could live no other way. What good would the money do me? I don't
want to sink into a mere eating machine, like Mrs. Short. I don't care to
seek the company of my neighbours. All I ask is, to be left in peace to go
my own way."
"Yet it does not make you happy."
"Happy! How could I be happy? I have lost all I ever loved,—I loved but
two, and they are gone. I don't look for happiness, madam,—not in this
world."
"Nor in the next," said May Cloudesley, in her soft, sorrowful voice; "for
you are not going the way that leads to it."
"Mrs. Cloudesley!" cried Ralph, half startled, half angry. "I am a

Christian, madam, I believe. I have never doubted the religion I learned
from my mother, the religion that my Annie loved so well."
"You have never doubted it," said May; "but you have never lived it.
'Love is the fulfilling of the law,'—'If any man have not the Spirit of
Christ, he is none of His.' I have only your own word to go upon, but you
say yourself that you have been a proud man and a hard man, keeping
far from you all the charities of life. Oh, don't fancy for a moment that
your belief is Faith. Faith means Obedience,—Obedience is Love in
action. I am not able to make my meaning plain, but my husband will if
you will talk to him. Dear Mr. Trulock, do think over what you have told
me, and then compare your own life with that of our one perfect
Example, who lived on charity, and spent His life in doing good, without
return. I have angered you, but indeed I did not mean to do so."
And poor May, overcome both by a feeling of pity and by a sense of

inability to make her meaning clear, burst into tears.
Trulock looked very much disturbed. He rose quickly and brought some
water, and watched anxiously until she was quite composed. Then he
said:
"I should prefer not to speak to Mr. Cloudesley, madam; but I will think of
what you have said. I am not vexed that you should speak plainly; I like
plain speaking. I don't see that you are right, though; and if I did, I doubt
that I could change now."
"Shall I tell you how to begin?" said May.
He shook his head; but she went on: "Help some one, be kind to some
one who needs kindness; use some of your money to relieve those who
need relief; say kind words to some one in sorrow. That's the soil in
which you must grow your Christmas roses," she concluded with a
smile.
Trulock looked argumentative.
"Madam," said he; "you will say I am no judge, but I have heard so many
sermons against that kind of thing. It seems to me that you imply that I
can be saved by works."
"There is no question here of being saved," said May, quickly. "You must
be saved by the Lord Jesus Christ, or not at all. But you say you have
faith, and I say with St. James—'Show me thy faith by thy works'; for I
think that a faith which leaves us just what nature made us, must be a
dead faith, don't you? We all have our besetting sin to conquer, and it
seems to me that pride is yours; but if you had love in your heart it would
turn out pride. And I think that though we cannot make ourselves feel
love all at once, yet we can do kind things, and then our hearts will grow
soft and warm. And I am sure that if you were doing kind things for
others, you would not dislike so much to accept kindness from others; at
least, I think so. But I am very young and ignorant, and, I'm afraid, very
presumptuous too, to talk to you like this. You'll forgive me, though,
won't you, Mr. Trulock?"
She looked up so sweetly, that he found himself assuring her that he

had nothing to forgive, which a moment before had not been his opinion
at all.
May went home and told her husband all that had passed.
"Well," said he, "you told him some plain truths, May; but you were quite
right. Now we must let him alone a bit. I fancy he will not stand too much
good advice; we'll wait and see how things go."
In May's opinion, things did not go well. Mr. Trulock changed none of his
habits, and was always out when she called. Mrs. Short assured her that
he was living like a slave or a wild Indian, just bread and water on week
days, and a morsel of meat on Sundays only, and a cup of tea once in a
way—not regular at all. Miss Jones said she had invited him to dine with
her, and that he had refused, not very courteously. And May had no
choice but to follow her husband's advice and "let him alone," for the
simple but sufficient reason that she could by no means get at him.
CHAPTER IV.
A SMALL SEAMSTRESS.
RALPH TRULOCK had never been a very happy man. Even when his
worldly affairs prospered, and his wife, whom he tenderly loved, and
who deserved his love, was with him; even before his son's behaviour
gave him cause for anxiety,—he had not been a happy man. He had
had all that the world could give him, and if you had asked him what
more he wanted, he would probably have said, "Nothing;" and yet he did
want something, and want it so badly that his heart was never at rest for
the lack of it.
The truth is, he was trying to satisfy an immortal spirit with mortal things,
and no one ever yet succeeded in doing that, excepting those who are
too dull to look beyond mere eating and drinking, warmth and comfort.
Of this class, Mrs. Short was a tolerable specimen; but Ralph cared little
for these things. His idol was of a higher order: it was his own opinion of
himself. He did not greatly care for other people's admiration, but he
must satisfy himself. His notion was, that a man should be perfectly just,
utterly truthful and upright, fulfil all his engagements honourably, and
never ask or accept a favour. He did not add, consciously, "and never
give any one anything except what they earn," but he acted on that
principle, though he never interfered with his wife's charities. He
believed that if he lived thus, perfectly righteous in all his dealings, he
should certainly go to heaven, even if he never felt any of those warmer
religious feelings of which his wife sometimes spoke. She had quite a
different kind of religion; but that was all right: she was a woman, and
humility and dependence become a woman, but men should be made of
sterner stuff.
Mrs. Trulock was a timid, gentle creature, far too humble even to think
that Ralph could need to be taught anything. She taught her boy
carefully, and when he went astray her loving heart broke, and she died,
expressing with her last breath a belief that "Fred would remember what
she had taught him, yet." I don't suppose she had ever heard the story
of the mother of St. Augustine, but she might have said with her, "He
must be saved, for he is the child of many tears and many prayers."
But if Ralph Trulock had never been a thoroughly happy man, he was
certainly a very miserable man now. He had never been idle in his life;
and here he was with nothing to do but to see on how little he could
keep body and soul together, that he might rid himself of the hated
obligation he now lay under, to men whose equal he had once been.
May Cloudesley's sweet face and sympathetic manner had thrown him
off his guard, and he had spoken to her more freely than he had ever
spoken before, even to himself, for he hardly knew that he had it in him
to feel and speak thus until he found himself doing it. And then that little
traitor, May, having stolen softly within his guard of proud silence, had
used her opportunity to stick a little dagger into his very heart!
Twenty times a day he told himself that she was only a silly young
woman, and that he knew better than she did; twenty times a day he
resolved to think no more of her words. But they kept coming back to
him, and would not be forgotten. He had always read a small portion of
the Bible on Sundays, and he found himself now, sorely against his will,
remembering that the spirit of the words he read agreed with what May
had said, more than with his own opinions. He could not keep his mind
from trying to make out a case for himself, and he could not help
knowing that he failed; that no text bore him out in his opinions. Still he
was haunted by one text which he could not remember exactly, but in
which the words, "What doth the Lord require of thee, but to do justly?"
certainly occurred; and he imagined that if he could only find that verse,
he could return to his old way of thinking comfortably, and forget May's
little dagger.
After much searching, he found the text at last; but it did not turn out a
comfort to him. "He hath showed thee, O man, what is good; and what
doth the Lord require of thee, but to do justly—" oh that it had stopped
there! But it went on—"and to love mercy, and to walk humbly with thy
God?" So not even this solitary text, on which he had built so much,
would bear the meaning he wished to find in it. Nay, might not May have
used it against him?
"To love mercy!" How could he set about that? He need not relax his
stern self-denial much,—not at all, in fact; but he might give a small
portion of what he saved, and it would only delay his hoped-for payment
a little.
Though Ralph looked so old, he was only sixty-five, so he hoped he had

time enough before him to permit of a little delay. And his conscience
would not let him go on without making some effort to walk by the new
light which May had let in upon him. He began to look about for some
one whom he might help, and one seldom looks long for that!
One afternoon in June—it was June now, for it took him a long time to
arrive at this point in his mental struggle—he went into Fairford to buy
himself some new shirts; his old ones had gone beyond even his not
unskilful repairs. There was a good shop in High Fairford. Price's, and to
that shop he betook himself. The young man at the shirt counter told him
that he had not a shirt of the particular size he asked for in the house,
but that there were a number actually in hand, and if he would sit down
and wait a few minutes, one of the workwomen had promised him four
that very day, "and she is always punctual," concluded the young man.
Not caring to return next day, Ralph took a seat and waited. Presently a
girl—a child rather, though there was a staid, responsible air about her
that was wondrous womanly—came quickly up the shop, and laying a
parcel on the counter, said to the young shopman,—
"Please, sir, I have brought home the four shirts."
"I told you she was punctual, Mr. Trulock!" said the shopman.
"Why, you don't mean to say that this child is one of your workers!" said
Ralph.
"And a very handy worker too! No need to look over these shirts—
there's never any scamped stitches in Miss Garland's work," added the
young man pleasantly, as he opened the parcel and took out the four
shirts. They were wonderfully well-made—you must remember that
Ralph's trade had made him a good judge of needlework—every part
was as well done as the girl could do it, the button-holes were well
worked, and the buttons conscientiously sewed on. It was all so clean,
too. Ralph conceived a good opinion of the girl at once. He bought the
shirts, and paid for them: he saw the girl cast a quick glance upon the
sixteen shillings he laid down, and give her head a little shake. She was
paid for her work at once—three shillings. Ralph lingered near the door:
something in the girl's face pleased and yet puzzled him, and he wanted
to see more of her. She came out in a moment, but was passing him
without notice, when he said to her,—
"Do you get only ninepence a piece for making these shirts?"
"That is all," she answered with a sigh; "but, sir, it is better than nothing."
"How long does it take you to make one?" he asked.
"One whole day and most of another. Now I have got petticoats to make
—with braid on them; like doing that, I get on quicker."
"Your mother should not let you sew so much," said Ralph. "It is bad for
a growing girl."
"I have no mother, sir, and neither has poor Ollie."
"Neither has who?"
"Ollie—Oliver, my little brother, sir."
Ralph thought she said the name oddly.
"Oliver?" he repeated. "Is that what you said?"
"That is the same name, but Ollie's mother was French, and we have
lived in France, where they say it as I do."
"You and Ollie lived in France?" Mr. Trulock said. He felt strangely
interested in the child. She was a rather pretty little girl, with a pale
round face and very soft dark eyes: she wore her short dark hair tucked
away behind her little ears, and she was dressed in a plain and scanty
black cotton frock, her straw hat being trimmed with a morsel of fresh
black crape. Something in her look, her voice, and above all her smile,
interested him: they reminded him of some one, he could not think of
whom—the slight foreign accent puzzled him, perhaps.
She answered his question after a momentary hesitation,—
"Yes; me and Ollie and our father."
Two great tears slowly welled up and then ran down her cheeks: she put
up her small right hand to rub them away, and he saw how the forefinger
was seamed with needle marks.
"And now there are only me and Ollie," she added quietly.
"You are here with friends I suppose?"
"No, sir; we have no friends here. Father was on his way here when his
illness came on—he bid me come here. I expected to find his people
here, but no one even knows the name. I suppose they lived here long
ago, and are all gone away now."
"Do you mean to tell me, child," said old Ralph half angrily, "that you and
this boy are alone in the world?"
"Indeed we are—quite, quite alone," the girl answered, with that quiet
sadness which was so like some one, if he could only remember who it
was.
"But you have money?" he said, turning to look at her.
"Oh yes, I have a little money. When my father died; he had some
money,—I do not know exactly how much—they took some to pay the
doctor, and the bill at the hotel, and—for his funeral. Oh, I don't want to
speak about it, sir!" and again the big tears rolled down, and the poor
little hard-working hand went up to her face. But after a moment she
went on again: "I am keeping all I have left very carefully. I work as hard
as I can, and so does Ollie, though he can only run with messages, of
course. I want to keep the little I have until winter."
"How long have you been here?" asked Ralph.

"I forget exactly. Oh, there's Ollie!"
A beautiful boy of about seven years sprang up from his game of

marbles,—he was playing with a lot of young urchins on the pavement.
They were about half-way down the steep hill now, and Ollie had not
seen his sister until she called out his name; how his black eyes danced
when he saw her! And with what glee he held up a fourpenny piece,
crying,—
"See what I have here! A monsieur gave me this for picking up his
whip!"
"Why, you've been very fortunate to-day, Ollie—twopence in the morning

for carrying a parcel, and now this; how much is it—fourpence? Well
done, Ollie!"
"Take it, Ruthie; I may lose it," the boy said gravely, and then returned to
his marbles.
"We live here, sir," said Ruth, stopping at the door of a small bakery.
"Good-bye, and I hope you will like your shirts."
Mr. Trulock shook hands with her—a mode of saying good-bye which
seemed to puzzle her not a little. He lingered until she had passed
through the shop. She paused and bought a fourpenny loaf, and he
heard her ask for:
"A stale one, if you please, ma'am;" then she vanished through a door
behind the counter, and Ralph entered the shop.
"Plain or fancy, sir?" said the old woman who stood behind the counter.
"I don't want any bread, thank you," Ralph answered; "I want to ask a
question about the child who has just passed through your shop."
"Do you know anything about her, sir?" asked the woman eagerly.
"Why, I wanted to know if you do?" replied Ralph.

"Not much, sir; she and the boy, Ollie she calls him, came here more
than a month ago. I had been to Derby on business, and they came in
the same train, and came on by the omnibus from the Forest station,
and Ruth began to talk to me. She asked me if I knew people of the
name of Garland in Fairford; and I said there never was a Garland in the
place since I could remember, and that is sixty years and more. It isn't a
Fairford name at all, as I told her. She looked so frightened and
downcast, that I began to ask questions; then she told me that her
father, who had brought the two children from France to Southampton,
had died there, sudden-like; and that he had told her his father lived in
Fairford, and she was to come here to him; he'd been coming here
himself, poor man. I took the children in for the night, and made inquiry
next day; but it was as I thought, no Garland was ever known here."
"It would be some other Fairford, perhaps—there are places of the same
name in other counties," suggested Ralph, much interested.
"No, sir; Fairford, —shire was written on the box the children brought
with them, in the poor man's own writing."
"But have they no means of living, ma'am, except by what they can
earn?"
"None; there's a box with good, comfortable clothes for both of them,
and the same belonging to the poor father; and Ruth has a little money
laid by, but only a few pounds. And that's all. I advised Ruth to save it up
and work hard, and she's a wise little creature, used to manage things
and to be busy. She pays me nothing for the little room they sleep in,
and I am glad to help them so far; but I'm too poor to do more. My
business is not what it used to be, nor what it ought to be," she added
with a sigh, and a look round the dingy little shop, into which indeed no
one had come since Ralph's own arrival. "I got her work from Price's;
she's a handy worker."
"Will you give the child this, ma'am, and tell her it is from the old man to
whom she was talking?" said Ralph, giving her half a crown.
"Indeed I will, sir, gladly, and very kind it is of you sir. Good evening."

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3. A retailer who has already done a great job of developing a strategy:

12. Retailing is often characterized as:

17. Which of the following is a key characteristic of monopolistic competition?

30. Divertive competition occurs when:

33. The wheel of retailing theory:

42. The last stage of the retail life cycle is:

53. Identify the incorrect statement about warehouse clubs.

55. Which of the following statements about supercenters is true?

59. Which of the following statements about liquidators is false?

64. Today, retailers typically view private label brands as:

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6. A vending machine would be considered a primary competitor of a grocery store.

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8. Pure competition is common in retailing.

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12. Situations of near monopoly do not exist

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17. Most retailers face monopolistic competition.

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20. Nonprice strategies cannot be used to improve profit performance.

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29. Intratype competition is the most common type of retail competition.

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36. Divertive competition can be intratype, but not intertype.