CRA Retail Industry Foundations 2

Question 1

Which retail format is characterized by a very broad product assortment and relatively shallow depth within each category?

Accepted Answer

Department store

Answer

Department stores offer wide breadth across many product categories but carry fewer SKUs per category than specialists.

Question 2

In retailing, the term 'shrinkage' refers to:

Accepted Answer

Inventory loss from theft, damage, or administrative error

Answer

Shrinkage is the difference between recorded inventory and actual on-hand inventory, caused by shoplifting, employee theft, vendor fraud, or errors.

Question 3

A retailer's 'private label' (store brand) strategy primarily aims to:

Accepted Answer

Increase vendor negotiating leverage and improve margins

Answer

Private labels allow retailers to capture higher margins and differentiate assortments while reducing dependence on national brand suppliers.

Question 4

The 'wheel of retailing' theory suggests that new retail formats enter the market by:

Accepted Answer

Entering as low-cost, low-margin operators and then trading up over time

Answer

The wheel of retailing posits that entrants compete on low price and minimal service, then gradually add services and raise prices, creating space for new low-cost competitors.

Question 5

Which of the following best describes 'omnichannel retailing'?

Accepted Answer

Providing a seamless, integrated shopping experience across all customer touchpoints

Answer

Omnichannel retailing integrates physical stores, e-commerce, mobile, and other channels so customers experience a consistent journey regardless of how they shop.

(CRA) Certified Retail Analyst Practice Test

(CRA) Certified Retail Analyst Practice Test

CRA Retail Industry Foundations 2