Theory question 102
Retail TradeCommerce 2 (essay)
(a) Define a multiple shop.
(b) State three features of a multiple shop.
(c) Explain three advantages and three disadvantages of a multiple shop.
Show the model answer
(a) A multiple (chain) shop is one of many branches owned by one firm in different towns, selling similar goods and controlled from a head office.
(b) Any three: many branches in different places; similar shop fronts/layout; uniform prices; same line of goods; central buying by head office; branch managers controlled by head office; usually cash sales.
(c) Advantages (any three, explained): bulk buying lowers costs and prices; risk spread over many branches; goods can be moved from branch to branch; well known name attracts customers; can afford specialist staff and advertising.
Disadvantages (any three, explained): little personal service/no credit; branch managers lack initiative; uniform prices ignore local conditions; high running costs; slow decisions through head office; staff may be dishonest because owners are far away.
Multiple shop = chain store.