Retailing.
1. Over the past year and half you worked at your church’s not-for-profit resale shop. Over this period, while the economic downturn has hurt sales at the nearby shopping center, it has really benefited your shop. In fact, sales have soared as cash-strapped consumers sought out bargains and donors wanted tax deductions. For example, shop prices for blouses and shirts range from $1 to $15 and designer jeans sold for $5 to $25 a pair compared with regular retail prices that were at least triple those amounts. Actually, the shop attracted a wide range of customers ranging from white collar workers who needed work clothes to bargain shoppers who enjoyed the thrill of the hunt. As a matter of fact, the shop’s consumers had a wide range in income and age, except for the students at the nearby college. As you prepared to return to school to graduate, your boss asked you to prepare a report with your ideas on how to attract college students to the shop. As she sees the problem, students only come to the shop in mid- to late-October seeking polyester suits and wide ties to wear to Halloween parties. They fail to realize what good merchandise the shop is actually selling. What can be done to get them to purchase home furnishings from the shop when they decorate their apartments and dorms in the fall and to seek out clothing that is only gently used instead of going to the shopping center? After all, she added, ‘‘We have labels like Old Navy, the Gap, Arizona Jeans, and Ann Taylor. It doesn’t make any sense to me why students on a limited budget would want to buy anything brand new if the clothes we sell are well taken care of.’’ a. Prepare a report with your ideas on how to attract college students to the shop. Think about how the recycled merchandise retail format is gaining market share as a result of recent economic slowdown. Discus how the not-for-profit resale shop can compete head-to-head with other retail-stores. Also discuss how various differentiation strategies can be used to attract college students. 2. You are thinking about buying a Ford Focus after you graduate this quarter. Use the Internet to see if you can get a better deal than the traditional auto retailers’ offer. All you will have to do is make three on-line connections, all free. a. Start by using DealerNet (www.dealernet.com), created by Reynolds & Reynolds, which provides computer services to dealers. You can see a picture of the Ford Focus and find out how it compares with competitors like the Chevrolet Cruze in such key areas as trunk space, fuel economy, and price. Suppose you decide on the four-door Titanium Model because you really want 17” sport aluminum wheels and the SYNC voice activated system. Write a description about how the car compares with the competitors’ cars. b. Key over to the prices posted by Edmund Publications (http://www.edmunds.com), a longtime compiler of such information. There you discover what the current sticker price is for the Titanium Model as well as what the dealer pays. You can also explore the Edmunds site to find out what special discounts and financing are available for the car you want. These facts may help you in evaluating the price your local dealer quotes. List the current sticker prices, any special discounts and what financing is available. c. When you’re ready to order, type in “http://www.autobytel.com.” There are several buying services on the Web, but AutoByTel is free. From here you can buy the car using AutoByTel directly or placing your order, and you’ll get a call from a nearby dealer. The dealer will charge you a fixed amount over the invoice and deliver the car. Describe the process at AutoByTel. (Don’t actually click to purchase the car, unless you want to receive phone calls from local dealers.) d. How did this process differ from what you would do if you only visited local dealers? Describe those differences.