Retail Strategic Analysis Flashcards
7 cards from real CRA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Retail Strategic Analysis flashcards as text
Which scenario best illustrates 'retail cannibalization'?
Answer: A store's online sales increase while in-store sales decline by a similar amount
Retail cannibalization occurs when one channel (e.g., e-commerce) draws sales away from another channel (e.g., physical stores) within the same company.
A retailer with a high 'days inventory outstanding' (DIO) relative to peers likely faces:
Answer: Excess inventory levels and potential markdowns risk
High DIO means inventory sits longer before selling, signaling potential overstocking, slow-moving merchandise, and future markdown pressure.
A retailer's 'net promoter score' (NPS) is most strategically useful for predicting:
Answer: Long-term customer retention and organic growth
NPS measures customer loyalty and likelihood to recommend, which correlates with repeat purchase rates and word-of-mouth driven customer acquisition.
In a retail strategic planning context, 'white space analysis' identifies:
Answer: Unmet customer needs or underserved market segments the retailer could enter
White space analysis uncovers gaps in the market—customer needs or segments that competitors have not adequately addressed—representing growth opportunities.
A specialty retailer decides to enter grocery as a new category. According to the Ansoff Matrix, this is:
Answer: Diversification
Entering a new product category (grocery) in potentially new customer segments represents diversification—the highest-risk quadrant of the Ansoff Matrix.
Which metric measures the profitability generated per dollar of selling space and is a key KPI for store portfolio decisions?
Answer: Sales per square foot
Sales per square foot directly links revenue generation to physical space usage, enabling comparison across stores of different sizes and informing real estate decisions.
A retailer conducts a 'trade area analysis' primarily to:
Answer: Determine the geographic catchment zone and customer base for a store location
Trade area analysis defines the geographic zone from which a store draws most of its customers, informing site selection and competitive positioning decisions.