Store Management WASSCE (SC), 2021

Question 2

 

  1. Explain the following terms:
    1. Bonded warehouse;
    2. Mark-down pricing;
    3.  Re-order level;
    4.  Stock-taking.
  2. State three functions of ABC Stores to Kokoview Ltd
  3. State three functions of retailer of the TV set

Observation

  • Some of the candidates who attempted the (a) part of the question had difficulty listing correctly the features of a bond.

    (a)        Explanation of terms

    • Bonded warehouse: This is a warehouse where goods are kept until custom duty is paid on them.
    • Mark-down pricing: It is a deliberate reduction in the selling price of goods and services in order to increase sales.
    • Re-order level: This is the level at which order for replacement or replenishment of stock must be placed. It is above the minimum stock level.
    • Stocktaking: It is the physical counting of all items held in the store against stock records. This exercise can be done periodically or perpetually.

                           
    (b)       (i) Functions of ABC Stores to Kokoview Ltd

    • It provides warehousing facility for the product;
    • It advertises the product on behalf of the company;
    • It finances the company through advanced payments;
    • It provides market information about the product;
    • It carries out market research on behalf of the company;
    • It ensures price stability for the manufacturer’s product;
    • It provides transportation facilities for the product;
    • It bears the risk of losses and damages on the product during distribution;
    • It buys in bulk from the manufacturer.

     

    (ii)  Retailers of the TV sets

    • It breaks bulk and sell in small units to the retailer;
    • It allows retailer to buy on credit;
    • It provides variety of goods;
    • It renders after sale services to the retailer;
    • It provides technical information about the product;
    • It provides delivery services to the retailer;
    • It provides advice to the retailer.