Beauty Business FREE Beauty Business Inventory and Retail Strategy Questions and Answers 2

Question 1

A beauty supply store notices that a particular hair serum consistently sells out within days of restocking. Which inventory strategy should the owner implement?

Accepted Answer

Increase the reorder point and safety stock level for that item

Answer

Discontinue the product to avoid stockout complaints

Answer

Keep the same reorder schedule but raise the price

Answer

Order the same quantity but switch to a different supplier

Question 2

What is the primary purpose of conducting an ABC analysis in a beauty retail inventory?

Accepted Answer

To categorize products by sales value so high-revenue items receive the most attention

Answer

To alphabetically organize products on shelves for easier customer browsing

Answer

To determine which products should be advertised on social media

Answer

To calculate the exact profit margin of each individual SKU

Question 3

A salon owner wants to reduce dead stock of seasonal beauty products. Which approach is most effective?

Accepted Answer

Use historical sales data to forecast seasonal demand and adjust purchase quantities accordingly

Answer

Purchase extra seasonal inventory to guarantee availability throughout the year

Answer

Store seasonal items indefinitely until they eventually sell

Answer

Offer seasonal products only through online channels to reduce shelf space costs

Question 4

Which retail pricing strategy involves setting beauty products at a high initial price and gradually lowering it over time?

Accepted Answer

Price skimming

Answer

Penetration pricing

Answer

Loss leader pricing

Answer

Everyday low pricing

Question 5

What key metric should a beauty business owner track to determine how efficiently inventory is being sold and replaced?

Accepted Answer

Inventory turnover ratio

Answer

Customer acquisition cost

Answer

Net promoter score

Answer

Website bounce rate

Question 6

A beauty retailer is implementing a just-in-time inventory system. What is the biggest risk associated with this approach?

Accepted Answer

Supply chain disruptions can cause immediate stockouts since minimal backup inventory is kept

Answer

Excess warehouse space will go unused and increase overhead costs

Answer

Customers may perceive the business as having too many product options

Answer

The retailer will need to hire additional staff to manage larger shipments

A beauty supply store notices that a particular hair serum consistently sells out within days of restocking.Which inventory strategy should the owner implement?

A beauty supply store notices that a particular hair serum consistently sells out within days of restocking.
Which inventory strategy should the owner implement?