Exam 10: Place and Development of Channel Systems

Use this information for question that refer to the World Tennis Ball (WTB) Company case. World Tennis Ball Co. (WTB) makes tennis balls and sells them only in the U.S. Raul Fernandez, the firm's marketing manager, is comparing his firm's distribution with two major competitors. 1) WTB sells its products through four regional distributors who then sell to 22 sporting goods wholesalers. The wholesalers sell to a total of 7,000 retail outlets. From its website, WTB also sells directly to any customer who will purchase a minimum quantity of 24 tennis balls. WTB cooperates with members of its channel, but maintains some control through its economic power and leadership. It helps to direct the activities of the whole channel and tries to avoid or resolve channel conflicts. 2) American Tennis Ball (ATB) is a competitor that sells through two distributors-each with half the country. The distributors then sell through 6 sporting goods wholesalers, and they, in turn, sell to 1,000 retail outlets (split between two national sporting goods chains and two general merchandise stores). ATB and its channel make little effort to work together. However, because of a relatively low level of competition between the distributors, the wholesalers, or the retail stores, each member of the channel gives the product special attention. 3) National Tennis Ball (NTB) sells its products through only three tennis specialty wholesalers that sell only to tennis clubs. NTB actually owns the wholesale firms that handle its products. NTB's balls are only available at certain tennis clubs and NTB limits coverage to only one club in a particular geographic area. If American Tennis Ball adds more retail outlets, which of the following would help it to manage channel conflict:

Intensive distribution is selling a product through all responsible and suitable wholesalers or retailers who will stock or sell the product.

Exporting is often the first step into international marketing.

Every morning, Sycamore Dairy picks up milk that farmers have "milked" that morning. The dairy processes the milk and separates the cream from the milk. Some of the cream is then made into butter and packaged in various size containers. The milk and remaining cream are blended into various products, sealed in pint, quart, and half-gallon containers, and then delivered to supermarkets in the quantities and assortments ordered. The dairy is providing what regrouping activity?

Channels used to retrieve products that customers no longer want are called collection channels.

A good "channel captain" knows that:

Accumulating involves collecting products from many small producers-often as a way to get lower transportation rates.

If a large furniture retailer were to purchase Drexel (a manufacturer of sofas and chairs), this would be an example of:

A manufacturer may be forced to use multichannel distribution because a big retail chain wants to deal directly with it instead of wholesalers.

Which of the following statements about Place is FALSE?

In a channel where retailers lead, intermediaries that gather, analyze, and interpret big data that generates insights about their customers' needs will:

A manager who helps direct the activities of a whole channel and tries to avoid or solve channel conflicts is a:

Firms that cooperate to build vertical marketing systems typically share a longer-term commitment.

Marketers need to foster cooperation with various members of a channel system to prevent:

Rizzo Shoes sells through ________ channel system. Rizzo has informal agreements with its wholesalers and retailers-they cooperate pretty well by placing orders, and sharing inventory and sales information over a computer network.

When McDonald's corporate headquarters offers a local McDonald's franchise to a franchisee on Bourbon Street in New Orleans, this is an example of ___________ distribution.

If a producer has a technically superior and expensive product-which has achieved brand preference-and wants retailers to provide aggressive promotion and maximum customer service, this producer should seek:

A firm would prefer an administered channel system to a corporate channel system for all the following reasons except:

Use this information for question that refer to the World Tennis Ball (WTB) Company case. World Tennis Ball Co. (WTB) makes tennis balls and sells them only in the U.S. Raul Fernandez, the firm's marketing manager, is comparing his firm's distribution with two major competitors. 1) WTB sells its products through four regional distributors who then sell to 22 sporting goods wholesalers. The wholesalers sell to a total of 7,000 retail outlets. From its website, WTB also sells directly to any customer who will purchase a minimum quantity of 24 tennis balls. WTB cooperates with members of its channel, but maintains some control through its economic power and leadership. It helps to direct the activities of the whole channel and tries to avoid or resolve channel conflicts. 2) American Tennis Ball (ATB) is a competitor that sells through two distributors-each with half the country. The distributors then sell through 6 sporting goods wholesalers, and they, in turn, sell to 1,000 retail outlets (split between two national sporting goods chains and two general merchandise stores). ATB and its channel make little effort to work together. However, because of a relatively low level of competition between the distributors, the wholesalers, or the retail stores, each member of the channel gives the product special attention. 3) National Tennis Ball (NTB) sells its products through only three tennis specialty wholesalers that sell only to tennis clubs. NTB actually owns the wholesale firms that handle its products. NTB's balls are only available at certain tennis clubs and NTB limits coverage to only one club in a particular geographic area. Which of the following describes WTB's channel arrangements?

Producers can positively manage channel conflict using all the following tactics except: