Chain stores achieve their efficiency in several ways. First, their size allows them to buy large quantities to take maximum advantage of quantity discounts and lower transportation costs. Second, the chains have been able to develop superior organizations by hiring good managers and developing special procedures in the areas of sales forecasting, inventorycontrol, pricing and promotion. Third, the chains are able to integrate wholesaling and retailing functions, while independent retailers have to deal with many wholesalers. Fourth, the chain get promotional economies by buying advertising that benefits all their stores and whose cost is spread over a large volume. And fifth, the chains permit their units some freedom to meet variations in consumer preferences and competition in local markets.
1 The defining feature of the corporate chain is common ownership and control.
A Right
B Wrong
C Not mentioned
2 Headquarters often play a role in training the staff for each unit.
A Right
B Wrong
C Not mentioned
3 The failures of independent stores are due to the chain stores.
A Right
B Wrong
C Not mentioned
4 Chain stores are designed in a similar architectural pattern for easy identification.
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