Exam 15: Distributing Products

The part of logistics that is most concerned with the flow of goods as well as work in process within the manufacturing firm is:

Denise Shipman works in the marketing department of a major manufacturing firm. She spends a great deal of time trying to coordinate the movement of materials, parts, finished goods, and information through all of the organizations involved in the distribution process. These activities suggest that Denise's job responsibilities focus on supply chain management.

The air freight industry is starting to focus on global distribution.

Exclusive distribution is the use of only one retail outlet in a given geographic area.

The process of managing the movement of raw materials, parts, work in progress, finished goods, and related information through all of the organizations involved in the supply chain in a timely manner is called multi-modal management.

Rodney Halpern works in the marketing department of a major manufacturing firm. Much of his job involves managing the movement of materials, parts, and information from suppliers to his firm. He tries to coordinate these flows with his firm's factory processes and assists with the efficient movement of finished goods to final consumers. These activities suggest that Rodney's job responsibilities focus on:

Suppose that eight bakeries each tried to sell their products directly to seven supermarkets. The total number of exchange relationships that would be established is:

What is logistics? Describe the types of issues you might deal with if you specialized in logistics.

Mini-Case "We've got a number of important issues to discuss today," began Dee Stribyute as she opened the weekly marketing manager's meeting for Lite Bite Foods. Lite Bite is a producer of low fat, low calorie snack foods. The other managers attending the meeting were her two top assistants, Mark Etter and Rhea Taylor. "First, sales were hurt last year when we had to recall our almond chocolate bars because of concerns about contaminated ingredients. We've got our work cut out for us to recover from that setback. Many stores quit carrying our products, and even the ones that continued to do so put less emphasis on displaying and promoting them. We've got to get our products into as many stores as possible. Consumers shouldn't have to go all over town trying to find our snacks. We also need to make sure that our products are displayed and promoted in a way that attracts attention." Dee looked at her assistants, and saw that they seemed ready to make some proposals. However, she decided to get another important issue out on the table before stopping to discuss solutions, so she continued with her comments. "The other big concern is the cost of moving our goods. Distribution costs are a major part of the overall cost of selling our goods. What can we do to make the flow of products from our kitchens to our ultimate consumers more efficient?" Having laid out her concerns, Dee sat down at the head of the table, saying to her assistants, "O.K. guys, I'm ready for suggestions." -After listening to all of the challenges and issues, Rhea said she wanted to propose a more sweeping change. "Mark has already suggested doing some of the retailer's job for them. I say go even further-let's just do away with all of the intermediaries. We can perform all of their functions ourselves," she said. She went on to explain that, "Since we won't have to deal with intermediaries, my suggestion is bound to simplify the distribution process and cut costs dramatically." Rhea's suggestion:

To marketers, the term utility refers to the value added to goods or services by organizations when they make the product more useful or accessible to consumers.

In the battle between electronic retailers and traditional "bricks and mortar" retailers, the electronic retailers seem to have all of the advantages needed to emerge as the clear winners.

__________ may represent several producers in a specific territory, as long as they do not represent competing products.

Marketing costs make up less than 25 percent of the total cost of the goods consumers buy.

Mall owners tend to like kiosks because they create a marketplace atmosphere.

Northern Lights Electronics just completed plans to distribute its new tablet. The product has several unique features that differentiate it from competitor products. The marketing team plans to begin a roll-out with ____________ to only one traditional retailer for the first two months. This strategy will give consumers the perception of the product's stand-out personality and increase demand. Marketing will proceed with _______________ for the next four months, where it plans to distribute to three other retailers, as well. For the last six months of the year, it will initiate distribution agreements with discount retailers and online retailers, and any other electronics store that wants to carry it. The marketing team is confident that the tablet will cycle through the first three stages of its product life cycle quickly. As the tablet reaches maturity during the second half of its first year in the market, it is good strategy to proceed with ______________, as described above.

Traditional retailers that have begun using the Internet to supplement their physical stores are finding that the Internet not only provides a new way to sell goods, it also requires a new system to distribute goods.

Producers of shopping goods such as furniture, appliances, and clothing usually rely on an exclusive distribution strategy.

Marcy and Liz developed a new jewelry design. They were fortunate to get the attention of a large online retailer who was willing to fund the production of the jewelry abroad, as long as the designers agreed to sell their design through its outlets for the first two years. The retailer was asking the designers to agree to __________________.

McDonald's, KFC, Baskin-Robbins, and AAMCO all make use of the __________ form of contractual distribution system.

A channel of distribution consists of the marketing intermediaries who join together to transport and store goods in their path from producers to consumers.