CRA CRA Merchandising & Category Management 2 — Questions and Answers
Question 1: What is a 'private label' product in retail?
- A nationally advertised brand sold exclusively at one retailer
- A product manufactured for and sold exclusively under the retailer's own brand (Correct answer)
- A premium import product with limited distribution
- A discontinued brand sold through clearance channels
Correct answer: A product manufactured for and sold exclusively under the retailer's own brand
Private label (store brand) products are manufactured by a third party but sold under the retailer's own brand, typically at higher margin.
Question 2: Which step in the category management process involves assessing the category's role within the overall store strategy?
- Category review
- Category definition
- Category role assessment (Correct answer)
- Scorecard development
Correct answer: Category role assessment
Category role assessment determines whether a category serves as a destination, routine, seasonal, or convenience category within the retailer's overall strategy.
Question 3: What metric measures the revenue generated per linear foot of shelf space?
- Sales per square foot
- Sales per linear foot (Correct answer)
- GMROI
- Inventory turnover
Correct answer: Sales per linear foot
Sales per linear foot measures how productively each foot of shelf space is contributing to revenue, guiding space allocation decisions.
Question 4: In a retail price ladder strategy, what is the purpose of a 'good-better-best' assortment?
- To confuse competitors about pricing strategy
- To offer tiered product options that trade consumers up toward higher-margin items (Correct answer)
- To eliminate mid-tier products from the assortment
- To comply with minimum advertised price policies
Correct answer: To offer tiered product options that trade consumers up toward higher-margin items
Good-better-best tiering provides entry, mid, and premium options, encouraging shoppers to trade up to higher-margin tiers while capturing all price-sensitivity levels.
Question 5: What is 'cross-merchandising' in retail store layout?
- Placing competing brands next to each other
- Displaying complementary products together to encourage add-on purchases (Correct answer)
- Rotating stock from back to front of shelves
- Advertising a product in multiple store circulars
Correct answer: Displaying complementary products together to encourage add-on purchases
Cross-merchandising groups complementary items across categories to prompt impulse purchases and increase basket size.
Question 6: Why is the 'power aisle' location valuable in retail merchandising?
- It is the widest aisle, reducing shopping cart congestion
- It receives the highest shopper traffic flow and provides maximum product visibility (Correct answer)
- It is closest to the loading dock for fast replenishment
- It is reserved for high-theft items with security packaging
Correct answer: It receives the highest shopper traffic flow and provides maximum product visibility
Power aisles are main throughways in a store that nearly all shoppers pass through, making them ideal for driving awareness of promoted products.
CRA CRA Merchandising & Category Management 2
What is a 'private label' product in retail?