The trend away from personal salespeople to self-service in many retail outlets has caused firms to:

• A. increase the number of employees on the sales floor
• B. focus less on customer experience and more on product variety
• C. reduce labor costs and potentially lower prices for consumers
• D. decrease the use of technology in retail operations

Answer: (C)

Verified step by step guidance

1. Step 1: Understand the context of the problem, which involves a shift from personal salespeople to self-service in retail outlets. This means customers serve themselves rather than relying on sales staff.
2. Step 2: Identify the impact of this shift on labor costs. Since fewer salespeople are needed, firms can reduce the number of employees, leading to lower labor costs.
3. Step 3: Recognize that reducing labor costs can allow firms to lower prices for consumers, as the savings from fewer employees can be passed on in the form of lower prices.
4. Step 4: Consider the alternatives given, such as increasing employees or decreasing technology use, and evaluate why these do not align with the trend toward self-service.
5. Step 5: Conclude that the correct effect of moving to self-service is to reduce labor costs and potentially lower prices for consumers, as this matches the economic incentives and operational changes involved.