Exam 11: Place and Development of Channel Systems

______________ (as a way to enter foreign markets) means selling the right to use some process, trademark, patent, or other right for a fee.

Direct marketing is primarily concerned with Promotion, not Place.

Vertical marketing systems account for a majority of U.S. retail sales.

Multichannel distribution:

The desirability of a common "product-market commitment" is based on the idea that:

Legal concerns about channel of distribution arrangements are most likely to arise when:

Use this information for questions 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. -National Tennis Ball's channel arrangement:

Sunkist sells foreign companies the right to use the Sunkist brand on soft drinks and citrus juices sold outside the United States. Sunkist gets both an initial fee and a royalty on the sale of goods bearing its brand name. Sunkist is engaged in:

A joint venture is:

Ideally, a "channel captain":

Vertical agreements to limit sales by customer or territory are always illegal, while horizontal agreements may be legal sometimes.

Oceanside Tools, Inc. of Newport, Rhode Island has agreed to work with a Thai company to produce and sell chemicals in Thailand. The U.S. firm will provide technical and marketing know-how, while its Thai partner will provide knowledge of Thai markets and political connections. The partners will share the costs and profits 50/50. This type of international involvement is called:

In a joint venture, a domestic firm enters into a partnership with a foreign firm.

_____ means selling the right to use some process, trademark, patent, or other right for a fee or royalty.

Discrepancies of quantity occur because individual producers want to produce large quantities of products while individual consumers prefer to buy products in small quantities.

Place decisions make goods and services available in the right quantities and locations, when customers want them.

If a producer agrees to enter into a management contracting arrangement with a zinc mining operation in Chile,

A publisher of photography books finds that it is cost-effective to print 10,000 or more at a time. But a bookstore orders only a few copies of each book since its customers want to select from a wide variety. This example shows

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

Strategy "Place" decisions would NOT include: