Exam 11: Place and Development of Channel Systems

Direct _____ involves personal sales contact between a representative of the company and an individual consumer.

In international markets, a firm can sell its management and marketing know-how while letting locals own the production and distribution facilities by using

In Europe, auto manufacturers are required by law to allow owners of their brands to give the cars back to the manufacturers at the end of their useful life. The manufacturers must then recycle and reuse at least 85 percent of any vehicle made after 2004. This is an example of a(n):

Bulk-breaking

A channel system in which the various members agree by contract to cooperate with each other is called a(an) ______________ system.

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. -A wholesaler for American Tennis Ball is likely to perform which of the following regrouping activities:

"Regrouping activities" involve adjusting the quantities or assortments of products handled at each level in a channel of distribution.

______________ means selling a product only through those intermediaries who will give the product special attention.

A wine producer wants a supermarket manager to display its wines in a desirable end-of-aisle location, but the supermarket manager refuses to give that valuable real estate to this producer. This is an example of __________ conflict.

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

Many business products are sold direct, but hardly any services are.

Which of the following statements about ideal market exposure is TRUE?

All of the following are regrouping activities EXCEPT

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. -Which of these companies uses a corporate channel of distribution?

If Penn Hills Mfg. Corp. gives the Johnstown Distributing Co. the exclusive right to distribute Penn Hills' products in Ohio--with the understanding that Johnstown can't sell Penn Hills' products outside Ohio or to other wholesalers in Ohio, this arrangement:

Traditional channel systems are growing faster than vertical marketing systems.

Most traditional channel systems don't have a channel captain.

A producer using several competing channels to distribute its products to its target market is using ______________ distribution.

Exclusive distribution is more likely to involve a more formal arrangement than is selective or intensive distribution.

Costco is a warehouse store that sells groceries, household items, and business products. Purchase quantities tend to be larger than in traditional stores that serve final consumers. For example, soft drinks are only sold in 24-can cases, not in 6-packs. Coffee is sold in 3-pound cans instead of one-pound foil packs. Which regrouping activity is Costco shifting to the consumer?