DECA Retail Merchandising Practice Exam

Which of the following is an example of intertype competition?

1. A boutique and a discount department store

2. Two grocery stores in the same area

3. A drug store and a specialty pharmacy

4. Two online retailers selling similar products

The correct answer is: A boutique and a discount department store

Intertype competition refers to competition between different types of retailers that sell similar goods or services but operate under different formats or categories. In the context of this question, a boutique and a discount department store fit this definition because they are fundamentally different types of retail establishments. A boutique typically focuses on unique, often higher-end merchandise and personalized customer service, while a discount department store offers a broader variety of products at lower prices, often in a more utilitarian shopping environment. Despite these differences in retail format and approach, both types of stores may cater to customers looking for clothing or fashion items, thereby competing for the same consumer dollars. Other options illustrate forms of intratype competition, where retailers of the same type compete against one another, such as two grocery stores or two online retailers. In these scenarios, the competition is more direct, as they typically offer similar products and target the same consumer base within the same retail format. The distinction of intertype competition emphasizes the diversity in retailing, recognizing that different types of stores can compete against each other for the same market segment.